Management of Technology –Theory and Practice

Abstract

Successful companies often link engineering, science, and management disciplines to develop and enhance their technological capabilities to achieve their strategic objectives besides giving competitive advantage to themselves on the basis of proprietary knowledge and know-how. As a result, they are making judicious use of technologies in launching their products in the market. This study is based on the theory of technological change process, which was developed by the ideas of Josef Schumpeter (1942), who saw innovation as a precursor to the present-age capitalist system. Schumpeter, listed three stages through which a new, and superior technology driven product is introduced in the marketplace. These three stages of new technology are invention, innovation, and diffusion, whose cumulative economic impact is collectively referred to as a technological change. The importance of an invention increases the probability of a new firm formation by commercializing the invention and exploiting the financial benefits to derive higher economic value for the entrepreneur. Technological change in small measure happens by undertaking incremental improvement of existing technology as opposed to introducing radical improvement, which is a new approach to a technical practice. While an incremental improvement supports the position of established firms, a radical improvement may undermine the position and activities of established firms. Therefore, established firms often choose not to pursue radical opportunities, leaving them to independent entrepreneurs, which give the latter a greater impetus to create new firms. Technological opportunities via new inventions which offer more intellectual property protection are more likely to be commercialized by a new firm creation. The paper discusses the role of funding for starting new business ventures, or small firms. In this context, the role of venture capital for funding new start-ups is discussed in detail. The use of S-Curves is analysed to highlight the technology performance, product comparisons, and to illustrate the introduction, growth and maturation of innovations as well as the technological cycles. Further, adoption of a new technology and replacement of old technology and the concept of technological obsolescence is also discussed.