Technological Forecasting and Assessment

1
Technological Forecasting and Assessment

• Dr. Steve Walsh
• Cell phone 681 - 4835

2
Mgt. 513 Week 1

• Introduction
• Objectives
• Style
• Etc

3
Outline

• Course Objectives
• Instructor background
• Student background
• Ch. 1 2 Porter
• E-mail your presentation preference

4
COURSE OBJECTIVES

• To develop an understanding of the issues of, and
  methods afforded managers furcating the future
  of sustaining and disruptive technologies.
• To gain an understanding of the management arenas
  that technological forecasting and Assessment
  provides value
• To provide a clinical approach to understanding
  technological forecasting Assessment

5
Course Evaluation

• 20 Article Homework
• 40 Weekly Take Home Quizzes
• 20 Assessing the Market
• 30 Technology and Market forecast paper
  or agreed upon project
• 10 Class Participation

6
Week 1 Introduction of Course Syllabus - August
24th

• Introduction of student background (focus on
  technology)
• Ch. 1 2 Porter
• First quiz handout

7
Week 2 August 31st

• Porter, Chapters 3-5 Guest speaker Randy Burge
  former Economic development Professional for the
  state Discussion of some potential projects
• Handout quiz 2
• Video

8
Week 3 September 7th Vacation
9
Week 4 September 14th

• Guest speaker to be announced
• Three eras of Technology Foresight (handout)
• Porter chapter 5
• Handout quiz 3

10
Week 5 - September 21st

• Porter, Chapters 6-8
• Reading Van Wyk, R, Management of Technology
  New Frameworks, Technovation, Vol. 7 (1988), pp.
  341-351.
• Handout quiz 4

11
Week 6 - October 5th

• Porter, Chapter 9-10
• Reading Anne Henriksen, A technology assessment
  primer for management of technology, Int. J of
  Technology Management, Vo. 13 (1997), pp.
  615-638.
• Handout quiz 5

12
Week 7

• Guest Speaker
• Project Discussion

13
Week 8 October 12th

• first assignment on Assessment or technology
  forecast of industrial or Corporate area on
  which you are working.
• Presentations in class about these descriptions.

14
Week 9 October 19th

• Porter 11-12
• Quiz 6

15
Week 10- October 26th

• Porter, Chapter 13-14
• Take home quiz 7

16
Week 11 November 2nd

• Guest Speaker 2

17
Week 12 November 9th

• Assignment due assessment of the technology, its
  feasibility, what will it do and how can it
  penetrate the market
• Presentations

18
Week 13 November 19th

• 1. Marie Garcia and Olin Bray, Fundamentals of
  Technology Roadmapping Sandia report 97-0665.
• 2.Sibylle Breiner, Kerstin Cuhls and Harioff
  Grupp, Technology Foresight using a Delphi
  Approach RD Management, 1994.
• 3. Maj Saren, Technology Diagnosis and
  Forecasting for Strategic Development, Omega,
  1991.
• 4. Richard Foster and Robert Rea, An Integrated
  Technological Forecasting and RD Planning
  System, Futures, 1970.
• Quiz 8

19
Week 14- November 23rd

• Porter 15-19
• Quiz no. 9

20
Week 15 November 30th

• Final Projects and Presentations

21
Week 16 December 7th

• Final Projects and Presentations

22
Chapter 1 Management, Technology, and the Future
23
What is Technology?

• The physical things - tools, machines, and
  materials that mankind uses for all activities
• The software aspects of technology
• Technical processes and procedures,
• Specific Technology groupings such as
• Biomedical etc.

24
Why Technology is of Increasing Significance

• More people do more things
• Interface of the technologies
• Work at the interface

25
Why Technology is of Increasing Significance

• The rapidity of introduction of technical
  successors is increasing
• Sustaining technology results in shorter
  marketplace life
• Because of increasing challenges from a new and
  superior technology.
• Because of rapid progress along current tech life
  cycle

26

• Technological change is a fact of organizations
  life
• Increasing pace of technological advances
• Increasing rapidity of technical successors
  introduction
• Shorter product life cycles
• Continuing challenge from new and superior
  technologies
• business organizations are challenged with
  changing present and uncertain future!

27
Why Technology is of Increasing Significance

• The size of resources required is often so great
  that the RD funding capacity of individual firms
  and even an entire industry is exhausted.

28
Why Technology is of Increasing Significance

• Source of competitive advantage
• Technologist
• Policy Makers
• Industrialists
• Management academics

29

• Knowledge of future impacts of todays decisions
  is limited uncertainty of future
• But companys future will be certainly shaped by
  todays decisions
• The challenge (of technology managers) lies in
  managing the present from the future (Smits,
  Rossini, and Davis (1987))
• Technology managers must develop
• organizational and planning tools to deal
• with this uncertainty

30

• Technology is the systematized knowledge applied
  to alter, control, or order elements of our
  physical or social environment (page 57)
• Technology is a key of productivity and source of
  competitiveness
• A nations competitiveness depends on the
  capacity of its industry to innovate, M. Porter,
  1990
• Investment in technology implies a better
  competitive strategy (ex GE dishwashers)

31
Result of Technologys Increasing Significance

• Technology assessment
• originally driven by concern regarding the
  negative effects of technology on the environment
  and society.
• now much more encompassing
• Technology forecasting
• assessment requires anticipation, therefore a
  need for technology forecasting.

32
Technology and Its Environmental Interactions
Political Environment
Technical Environment
Competitive
The Institution Management Technical Resources
and Facilities
The
Institutions
Economic Environment
Social Environment
Ecological Environment
33
Categories of Technology Management Decisions

• Those affecting the organization immediately
• Require modest extensions of existing knowledge
• Are based on internal factors to the firm and the
  technology involved

34
Technology Mgt Decisions

• Others will affect the positioning of the
  organization relative to broader market or social
  factors in the future
• Require long term uncertain extensions of
  knowledge
• Take consideration of variety of external factors
• Require forecasting and assessment techniques

35
Technology in the 21st Century
36
Chapter 2 Principles of Sociotechnical Change
37
Sociotechnical Change

• Sociotechnical change can be looked upon as a
  spiral process in which an open systems changes
  under the mutual causal influences of its
  elements
• Technologies cause societies to change by
  restructuring institutions and behaviors
• Societies cause technological changes by
  investment or by institutionalizing the processes
  of innovation

38
Sociotechnical Change

• Technology forecasting
• It provides a perspective on the dynamics of
  technological change
• Effects of interest
• New technologies
• Incremental and /or discontinuous changes in
  existing technologies
• End processes
• Development of technological principles and/or
  prototypes
• Diffusion of technological devices
• Some of the techniques trend extrapolation,
  Delphi, scenarios.

39
Sociotechnical Change

• Impacts assessment
• It consists of assessing the impacts of changes
  caused by the diffusion of forecasted technology
  (ies)
• The most challenging aspects in the impact
  assessment process are the interlinked causes and
  effects that extend over long periods, example
  unforeseen air pollution caused by a widespread
  use of automobile
• The two most common ways of classifying impacts
• By impacted group
• By class of impact (economic, social,
  technological)

40
Sociotechnical Change

• Technology management
• It functions within the framework of a single
  organization
• Its objectives are to benefit the organization in
  both its internal functioning and its external
  relationships

41
Technology Deliver System (TDS)

• It addresses sociotechnical changes in a limited
  environment and it has four main components
• Inputs capital, natural resources, human values,
  knowledge, manpower
• Institutions and organizations both public and
  private
• System processes by which institutions interact
• System outcomes both direct (intended) and
  indirect (unintended)

42
(No Transcript)
43
Technology Foresight

• Foresight involves systematic attempts to look
  into the longer-term future of science,
  technology, the economy, the environment and
  society with a view to identifying the emerging
  generic technologies and the underpinning areas
  of strategic research likely to yield the
  greatest economic, environmental and social
  benefits

44
Technology Foresight

• Attempts to look into the future must be
  systematic to come under the heading of
  Foresight
• Attempts must be concerned with the longer-term,
  typically 10 years and possibly 5-30 years

45
Technology Foresight

• A process rather than a set of techniques
• Involves consultation and interaction between
• the scientific community
• research users
• policymakers

46
Technology Foresight

• One focus on prompt identification of emerging
  generic technologies
• technologies whose exploitation will yield
  benefits for several sectors of the economy or
  society
• still at pre-competitive stage and can be
  targeted for selective funding to ensure rapid
  development

47
Technology Foresight

• Another focus is on strategic research
• basic research carried out with the expectation
  that it will produce a broad base of knowledge
  likely to form the background to the solution of
  recognized current or future practical problems

48
Technologies Rise and Fall

• According to understandable processes.
• According to reasonably predictable patterns.
• Technology forecasting is a function of
  understanding the processes and knowing the
  typical patterns.

49
Cycles of Innovation and Obsolescence

• Product life cycle
• Product line life cycle
• Technology life cycle
• Kondratieff/ Schumpeter life cycles

50
Product Life Cycle

• A product lifetime is the time between
  introduction of a new product into the
  marketplace and its withdrawal from the market.
• Five principal reasons why products have finite
  lifetimes
• Technical performance obsolescence
• Technical feature obsolescence
• Cost obsolescence
• Safety obsolescence
• Fashion changes

51
Product Life Cycle
Withdrawn from market
Maximum Profit
Maximum Sales Volume
Profit Revenue (x100,000)
Sales Revenue (x1,000,000)
4
Maturity
Innovation
Growth
4
Decline
Profit
3
3
2
2
Sales Volume
1
1
Commercial launch
Years from Launch
52
Technology Lifecycle
Natural limit to technology
Slow finish, nearing limit
Critical Dimension
Region of Maximum Rate of Progress
Critical dimension necessary for functionality
Slow start, No Knowledge
Time
53
Competitive Technology Lifecycle
Critical Dimension
Traditional technology
Emergent technology
Time
Ex Vacuum tubes v. transistors Sail v.
steamships
54
Industry Life Cycle
Sources of Distinctive Competence at Different
Stages of Industry Evolution
Growth rate lt 0
Unit sales
Takeoff
Market growth rate Population growth rate
Profit
Maturity
Growth
Emergence
Decline
55
Long Wave Business Cycles

• Nikolai Kondratieff
• Joseph Schumpeter

56
Kondratieff Wave
57
Schumpeters Wave
58
Technology Adoption Processes

• Technology-driven adoption
• more economical or technologically superior to
  existing.
• Diffusion
• penetrates the market of leaders and followers
  according to their acceptance of change.
• Mortality
• adopted when old technology wears out or breaks.

59
Diffusion Process

• Concentrates on characteristics of the adopters/
  communication among them.

13.5
34
2.5
16
34
_ x-2?
_ x-?
_ x?
_ x
Late Majority
Early Adopters
Early Majority
Laggards
Innovators
Source Everett Rogers
60
Technologically-Driven Adoption Process

• Technology substitution
• S-shaped curve
• New technology initially expensive, unfamiliar,
  unproven, and imperfect, ? old technology
  superior from business perspective

80 to 90 Market Penetration Decreasing Rate of
Adoption
Increasing Applications Increasing Market
Penetration
Niche Applications 10 to 20 Market Penetration
61
Mortality Process

• Breakdown of old technology drives adoption of
  new technology.
• Models based on age distribution of existing
  technology base/ projections on retirement.
• S-shaped adoption curve
• pronounced s-shape when existing technology base
  is relatively new.
• early slow part of the S-shape will be missing
  when new technology used for all replacements of
  old.

62
Factors Affecting Technology Adoption

• Relative Advantage
• Compatibility
• Complexity
• Trialability
• Observability
• Re-invention

63
Theorems of the Digital Age

• Moores Law
• The power of computing for a given price doubles
  every 18 months. In ten years, the power of the
  technology increases by a factor of 100.
• Metcalfs law
• The usefulness of a network increases as the
  square of the number of users.
• Moores Second Law
• The cost of the manufacturing facility for chip
  production also doubles every 18 months.