Technology acquisition
Technology Management
Activities and Tools
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Discuss:
What are the decision criteria for
technology acquisition?
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Acquisition channels (1)
BUY
 Sponsoring university research
 External R&D centers
 Consultants
 Licensing agreements
 Vendors/ suppliers
 Acquiring machinery or the firm
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Acquisition channels (2)
MAKE
 R&D
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Acquisition channels (3)
COLLABORATE
 Consortia
 Joint ventures
 Sub-contracting
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Make or buy or collaborate decision
depends on: (Chiesa and Manzini, 1998)
1) strength of the organization’s own capabilities
(relative costs)
2) respective transaction and governance costs
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contract price, cost of information, monitoring
performance, committing specific assets, handling
complexity in reaching agreements
3) dynamic transaction costs
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costs of persuading, negotiating, coordinating, and teaching
outside suppliers
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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There is no ONE best organizational form!
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The firm is not only “profit maker” but
innovator so it should have profits and scale
necessary to finance the overhead expenditures
requried to anticipate change and create “future
values”.
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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BUY option
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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The reasons behind technology
acquisition
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Limited resources
Time pressure
Complementary assets
Protecting image
Diversification
Supporting internal technologies
Avoid development risks
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Expected resulting impacts of
technology acquisition
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productivity
quality
product development cycle
labor-management relations
accuracy of the information flows
production costs
flexibility (volume, machine, process,..)
maintenance costs
service performance
sales
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Steps in technology acquisition
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Goal setting
 Technology & Impact assessment
Finding technology suppliers
 Acquisition channel
Choosing acquisition method
Contract preparation and negotiation
Technology transfer
Managing long-term collaboration
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Collaboration option
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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The content of the collaboration (Chiesa
and Manzini, 1998):
1) Definition of the content
2) Firm’s familiarity
3) Relevance for the firm’s competitive adv.
4) Technology life cycle
5) Level of risk
6) Appropriability of the innovation
7) Phase of the innovation process
8) Level of assets specialization
9) Divisibility of assets
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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What are the issues when
managing external suppliers and
alliance partners?
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Issues in Collaboration network design:
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Aim
Partners
Duration
Contract
Management
Investment / Re-engineering
Division of labour
Strategy
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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How to decide on the type of Collaboration
network?
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The objective of the collaboration
The content of the collaboration
The type&structure of partners involved
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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R&D
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Open Innovation
Research
Development
Commercialisation
IP in-licensing
Products in-sourced
(e.g. Co-branding)
Company
Boundaries
Core Market Focus
Technology
Spin-outs
IP out-licensing
Ideas &
Technologies
Source: Chesborough 2003 and Docherty 2006
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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The key tasks in designing new process are as
follows (tushman and andersen (2004)
1)
2)
3)
4)
5)
6)
Identifying process for innovation
Identifying change elements
Developing process visions
Defining business strategy and process vision
Understanding existing processes
Understanding the structure and flow of the
current process
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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The key tasks in designing new process are as
follows (tushman and andersen (2004) cont.
7)
8)
9)
10)
Measuring the performance of the current
process
Designing and prototyping the new process
Implementing and operating the process and
associated systems
Communicating results and building
commitment
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Tools for new product
development
1)
2)
3)
4)
5)
6)
7)
Design for asembly
Design for manufactring
Design for serviceability
Design for testability
Design for environment
System engineering
Value analysis and value engineering
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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New ProcessDevelopment
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Procter&Gamble Case (1)
Collaborations: Open Innovation
(Sakkab, 2002)
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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P&G Case (2)
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P&G is a technology-rich company: 27000
patents, 4000 unique titles and 3000 new patents
each year.
It invests $1.8 billion annually on R&D.
Even though P&G use less than 10 per cent of
its own technologies in company products
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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P&G Case (3)
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Internal website, 18000 innovators across R&D, Engineering,
Market Research, Purchasing, and Patent Divisions.
600 websites for Global Project Teams
Individual problem-solving and connection-making websites for 20
Communities of Practice.
Nearly 9 million documents on line, growing daily.
Automation and artificial intelligence
the latest in webcasting and satellite technology to create an internal
Innovation News Network
Conducting a deal-making/technology trading expo
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over 2200 ideas for new products and important new uses of P&G and
external technologies
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
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Identification
Selection
Business
strategy
Acquisition
Internal acquisition:
R&D
External acquisition
Collaborative R&D
New product
dev.
Purchase
New process
dev.
M&A
Other projects
Outputs
new product / service equipment / solutions
Protection
Exploitation
Asst. Prof. Dr. Yavuz Selim ÖZDEMİR
Learning
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