BM050-3.5.

3 Innovation Management and New

Product Development (IMNPD)

An introduction to New Product

Development (NPD)

New products Development:

Open Innovation and Technology
Transfer
 New Product Development- Open
Innovation and Technology Transfer

Learning Objectives
1. Recognize the importance of the concept of technology/knowledge
transfer with respect to innovation management
2. Provide a summary of the process of technology/knowledge
transfer
3. Examine the various models of technology transfer
4. Assess the importance of itnernal organization factors and how
they affect inward technology transfer
5. Explain why a ‘receptive’ environment is necessary for technology
transfer
6. Identify the different barriers to technology transfer
7. Recognize how tacit knowledge links technology transfer and
innovation

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 Background
Overview
 Paradigm shift from labor and capital intensive
industries to knowledge and technology
 Internal development too uncertain, too
expensive and too slow for the rapid
technological changes in the market
 ‘Corporations trade in technology in world
markets just as they do in other goods and
services’ (DFI International, 1998:93)

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 The Economic Perspective of
Technology Transfer

Can be transferred to

Existing R&D projects and Industry and private

developed technology which enterprise
has already been paid for

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 Open Innovation

 Trend of shifting away from closed systems to

new mode of open systems involving a range of
players distributed up and down the supply
chain
 Strong linkage within the innovation process
between the external environment of the firm
and internal environment

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 Technology Transfer

“Technology transfer is the application of technology to a

new use or user. It is the process by which technology
developed from one purpose is employed either in a
different application or by a new user. The activity
principally involves the increased utilization of the existing
science/technology base in new areas of application as
opposed to its expansion by means of research and
development”
(Langrish et al., 1982)

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 Information Transfer and
Knowledge Transfer

 Information is central to the operation of

firms
 Stimulus for knowledge, know-how, skills
and expertise
 The application of these knowledge then
leads to actions and skills

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 Models of Technology Transfer

Licensing – Involves the technology owner receiving a

license fee in return for access to the technology
Science Park Model – academic scientists will have the
opportunity to take laboratory ideas and develop them into
real product e.g. Silicon valley
Intermediary Agency Model – act as the intermediary
between companies seeking and companies offering
technology
Directory Model – The produced directories of technology
available from the university’s own research laboratories
e.g. www.patentexplorer.com

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 Models of Technology Transfer
Knowledge Transfer Partnership Model – “teaching
company scheme” studies part time for 2 days a week and 3
days working on the project”
Ferret Model – qualified scientists and engineers who would
ferret around for interesting defense technology that could
have wider commercial opportunities
Hiring Skilled Employees – Hiring people with the necessary
skills and knowledge
Research Clubs – Funded program which tries to bring
companies together with common interest in particular
research area
Consultancy – Consultants are able to offer help, advise and
useful contacts to get the research project to a flying start
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 Limitations and Barriers to
Technology Transfer
 The difficulty of applying other people’s
technology and the need for this technology to
be in such a form that organization can reap
some benefits
NIH Syndrome
 Not invented here syndrome
 Tendency for project group of stable position to
believe that it possesses the monopoly of
knowledge in its field

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 Internal Organizational Factors and
Inward Technology Transfer

Types of companies
 Innovators: The first company to adopt a new
idea
 Initiators: The firms that adopted the idea soon
after the innovators
 Fabians: The firms who adopted the idea only
after its utility was widely acknowledged in the
industry
 Drones: The last firms to adopt new ideas

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 Internal Organizational Factors and
Inward Technology Transfer

Factors leading to technology transfer

 High quality of incoming communications
 A readiness to look outside the firm
 A willingness to share knowledge
 A willingness to take on new knowledge, to
license and to enter joint ventures
 Effective internal communication and
coordination mechanism

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 Internal Organizational Factors and
Inward Technology Transfer
Factors leading to technology transfer
 An awareness of costs and profits in R&D
departments
 Identification of the outcomes of investment
decisions
 Good quality intermediate management
 High status of science and technology on the
board of directors
 High quality chief executives
 High rate of expansion
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 Conceptual Framework of Technology
Transfer
Activity Process
Awareness Describes the processes by which an organization
scans for an discovers what information on
technology is available
Association Describes the processes by which an organization
recognizes the value of technology(ideas) for the
organization
Assimilation Describes the processes by which the organization
communicates these ideas within the organization
and creates genuine business opportunities
Application Describes the processes by which the organization
applies this technology for competitive advantage
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 Identifying External Technology

The Importance of Scanning and Networking

 Scanning and networking as an informal and unassigned
activity
 Key characteristic of technically progressive firms is high
quality of their incoming information
 For the purpose of maintaining order and knowledge
base
 Each organization research activity represents a fraction
of the worlds total scientific and technological activity
 Important to ensure they are aware of technology around

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 Managing the Inward Transfer of
Technology

 The final stage of application of the

business opportunity for competitive
advantage
 Organization brings about commercial
benefits from the launch of a new product,
improved product or manufacturing
process

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 Organization Context- Open
innovation and technology transfer
Acquisition of
technology from
outside Level of Learning

Individual

Continual flow of
tacit and explicit Group
knowledge

Organization

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 Tutorial

1. Explain the importance of tacit knowledge

to the technology transfer process
2. Explain how a firm’s internal activities
affect its ability to acquire external
technology

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