FRAMEWORK FOR STRATEGIC TECHNOLOGY MANAGEMENT IN
HIGH-TECHNOLOGY ENTERPRISE CONTEXT
Dr. Kari Sahlman*, Nokia Siemens Networks, Finland
kari.sahlman@nsn.com
*corresponding author
Prof. Harri Haapasalo, University of Oulu, Finland
harri.haapasalo@oulu.fi
ABSTRACT
Strategic technology management is an important practice for enterprises in an increasingly
complex economic and social environment. In technology-based global competition
advancements of technology proliferate rapidly. Companies have to manage their
technological capabilities for business model development, product innovations, and for
maintaining their productivity and competitiveness.
Entire field of strategic technology management is ambiguous and literature on theoretical
frameworks is diverse. Practitioners in companies are lacking a comprehensive frame of
reference for strategic technology management. In this paper a framework is discovered to
describe elements of strategic technology management in high-technology enterprise context.
The framework is developed based on literature findings and by obtaining qualitative
information on enterprise practices. The empirical research was conducted in 2008 – 2009 in
the context of 45 large and small to medium-sized high-technology product companies and
involved some 70 informants. Mainly abductive reasoning is used to infer explanation for the
framework. Integrated management theory is applied to consider technology management in
strategic dimension, categorized as structures, objectives and impacts.
Strategic management, organizational management, and technology management concepts
are united in the framework as the main theoretical contribution. The paper provisions an
outline to assist practitioners in definition and development of the practices in enterprises. As
managerial implication, it is suggested that companies should consider establishing strategic
technology management as an own managerial function amongst other organizational
management disciplines.
In summary, the framework provides for scholars and practitioners a logically structured
framework for strategic technology management.
Keywords: Strategic management, technology management, framework, MoT, technology
management framework, enterprise, enterprise development.
INTRODUCTION
In technology-based global competitive environment companies have to manage their
technological capabilities to maintain their competitiveness. Strategic technology
management is an important practice for enterprises in an increasingly complex economic
and social environment. The field of strategic technology management is related to several
management disciplines, and literature on theoretical frameworks is diverse (see e.g. Khalil,
2000; Tidd, 2001; Phaal et al., 2004; Pilkington & Teichert, 2006; Cetindamar et al., 2009).
For practitioners in companies the problem is that there is no comprehensive frame of
reference for strategic technology management. In this paper a framework for strategic
technology management in high-technology enterprise context is synthesized from based on
findings from four individual research phases. The research question is:
RQ What are the elements of strategic technology management in high-technology
enterprise context?
The framework was developed during 2008-2009 based on literature findings and by
obtaining qualitative information on enterprise practices. The empirical research was
conducted in the context of 45 large and small to medium-sized high-technology product
companies. In the interviews and workshops some 70 experiences informants who knew the
topic well were involved for structures and impacts category study, and technology
management decision making material from a large company was used to gather information
for the objectives category. Mainly abductive reasoning was used to derive some 250 classes
and sub-classes for the 18 main elements of the framework. Integrated management theory of
Bleicher (2004) was applied to consider technology management in strategic dimension
categorized as structures, objectives and impacts. For each of the category a complete
research phase was conducted, the results were documented and an article was written. In
each of the articles the research process is presented and discussed in detail. The overview of
the research proceeding is presented in Figure 1. The 5th research phase is in the scope of this
paper.
1. PHASE
INITIAL
FRAMEWORK
Research problem,
literature study,
research questions
Industry
Workshops
Analysis,
abduction
Initial
Entire
Framework
2. PHASE
STRUCTURES
Questionnaire
Interviews
Analysis,
abduction,
reporting
Refined
Structures
Category
3. PHASE
OBJECTIVES
Open coding,
analysis,
note taking
Axial coding,
relations
comparison
Selective coding,
memoing,
sorting
Refined
Objectives
Category
4. PHASE
IMPACTS
Questionnaire
Interviews
Analysis,
abduction,
reporting
Refined
Impacts
Category
5. PHASE
ENTIRE
FRAMEWORK
Strategic technology management
framework
Figure 1: Proceeding of the research.
Validation of the entire framework
TYPES OF TECHNOLOGY MANAGEMENT FRAMEWORKS
Linking business to technology is a managerial challenge in enterprises. Strategic technology
management is assumed to provide a solution to manage complexity caused by technology in
dynamic environment (e.g. Burgelman et al., 2001; Dodgson et al., 2008). Technology
management is often conducted as part of R&D management or innovation management
(Drejer, 1997; Edler et al.; 2002, Tidd, 2001). Drejer (1997) have described four schools of
technology management that emphasize R&D management, innovation management,
technology planning or strategic technology management. According to Edler et al. (2002) so
called 4th generation R&D management sees R&D and technology as strategic instruments
for competitiveness and innovations, and emphasizes formulation of explicit technology
strategy and integration of technology with business strategy. Current themes in R&D
management are open innovation, networked R&D and knowledge management
(Chesbrough, 2006; Lichtenthaler, 2008). In innovation management school the emphasis is
on anticipation of technological changes and incubation of innovative products for
commercialization, whereas in technology planning school the scope is to manage technology
across the company using specific management methods like road mapping and portfolio
management (e.g. Cooper et al., 1998; Tidd, 2001). Strategic technology management school
combines technology and business aspects through management of technology activities (e.g.
Drejer, 2004; Phaal et al., 2004; Lichtenthaler, 2008).
Positioning of strategic technology management is difficult due to the intertwined nature of
technology in enterprise management. Multiple theoretical and practical frameworks for
describing elements of technology management have evolved, but still the entire field is
confusing and boundaries of concepts are blurred, and there are no commonly accepted
frameworks (Phaal et al., 2004; Brent and Pretorius, 2008; Cetindamar et al., 2009). In table 1
is presented main types of technology management frameworks. Each of the framework types
emphasize particular aspects of technology management i.e. processes, routines,
methodology, need to integrate technology management with core business and strategic
processes, or technology management as management of knowledge flows. Integrated
management approach introduced by Tschirky (1991) sees technology management as a task
of general management and divides the tasks into normative, strategic and operative
dimensions.
Table 1: Main types of technology management frameworks.
Technology management framework type
Generic process model
Technology management functions
Technology management routines
Technology strategy approach
Innovation funnel
Knowledge management
Methods and tools approach
Integration into core business processes
Integrated management concept
Example reference
Gregory,1995; Cetindamar et al. 2009
Kropsu-Vehkaperä et al. 2009
Levin and Barnard 2008
Burgelman et al. 2001
Wheelwright and Clark 1992
Nonaka 1995
See e.g. Phaal et al. 2006
Metz 1996; Phaal et al. 2004
Tschirky 1991
FRAMEWORK FOR STRATEGIC TECHNOLOGY MANAGEMENT
For the framework development concepts from strategic management, technology
management and organizational management theories are used. The essential concepts and
key references are presented in dissertation of the author. From strategic management
perspective the role of technology in value creation, business model definition and as a
source of productivity is emphasized. Moreover, technological capabilities affect on
company’s success in formulation and execution of company’s business strategy. In external
socio-economic context technology has a major impact for sustained development and wealth
creation. For the framework creation integrated management concept is used as the basis
from organizational management theories. (Sahlman and Haapasalo, 2009a; Sahlman, 2010)
Elements of strategic technology management are described in strategic dimension in three
categories: structures, objectives and impacts. The framework is a reference model that
describes the categories, their main elements and contents to provide viewpoints on strategic
technology management. The strategic technology management framework is presented in
Figure 2.
NORMATIVE MANAGEMENT
STRATEGIC
MANAGEMENT
STRUCTURES
OBJECTIVES
IMPACTS
ARTIFACTS
PRODUCT OFFERING
OBJECTIVES
TANGIBLE
IMPACTS
PROCESSES
VALUE CHAIN
OBJECTIVES
BUSINESS MODEL
IMPACTS
METHODS, TOOLS,
IT SYSTEMS
OBJECTIVES FOR
TECHNOLOGY ASSETS
KNOWLEDGE BASED
IMPACTS
ORGANIZATIONAL
FUNCTIONS
PRODUCTIVITY
OBJECTIVES
TRANSITIONAL AND
DYNAMIC IMPACTS
GOVERNANCE
STRUCTURES
OBJECTIVES FOR
INTERNAL POLICIES
SOCIO-ECONOMIC
IMPACTS
COLLABORATION
NETWORKS
OBJECTIVES FOR
INDUSTRY RELATIONS
ENVIRONMENTAL
IMPACTS
OPERATIVE MANAGEMENT
Figure 2: Strategic technology management framework (Sahlman, 2010; published by
permission of ACTA Universitatis Ouluensis)
Structures category of the framework
The structures category contains the main classes of artifacts; processes; methods, tools and
IT systems; governance; organizational functions and collaboration networks. The category
contains a logical process view to a company considering methods, tools and IT systems that
are needed to produce artifacts by procedures and practices. The operative work is governed
and performed by organizational functions that are making decisions and managing the
activities. Furthermore collaborative networks represent stakeholders that are involved in the
activities and form a part of the technology infrastructure for the company. The structures
category of the framework is presented in Table 2.
Table 2: Structures category of strategic technology management framework (Sahlman and
Haapasalo 2009b, published by permission of PICMET conference organization).
Main element
ARTIFACTS
Definition
Information, documents, reports, plans, prescriptions as the
outcomes of the performed processes of technology management.
PROCESSES
Procedures and practices performed to transform inputs into artifacts
of technology management.
METHODS, TOOLS, IT SYSTEMS Techniques and tools to perform tasks of the procedures and
practices of technology management. Information systems for
processing and storing artifacts generated in the processes of
technology management.
GOVERNANCE
Management structure, definition of authorization and policies for
decision-making of technology management topics.
ORGANIZATIONAL FUNCTIONS Managerial disciplines of an organization for planning, organizing,
leading and monitoring technology management functions.
COLLABORATION NETWORKS
Stakeholder organizations involved in the company's processes of
technology management.
Objectives category of the framework
The objectives category’s main elements consist of product offering, value chain, technology
assets, productivity, internal policies and industry relations. The objectives category of the
framework is presented in Table 3.
Table 3: Objectives category of strategic technology management framework (Sahlman and
Haapasalo, 2011b, published by permission of Inderscience).
Main element
Definition
PRODUCT OFFERING
Objectives for product offering enabled by technology e.g. cost,
performance, capacity, quality, reliability, availability, maintainability,
and commonality.
Value chain related objectives for technology supply e.g. business
scope and scale of technology use, position in value chain, revenue
logic, supplier lock-in, technology change cost.
Objectives for technology assets e.g. scope, scale of deployment,
lead time for products, life-cycle state, performance, and compliancy
to internal and external standards.
Objectives for productivity enabled by technology e.g. technology
portfolio scope and scale, life-cycle position, operating expenses,
capital expenses, scope and scale of competence and resources to
develop and maintain the technology base.
Objectives for internal policies, standards, processes and practices
e.g. policies and internal standards definition and deployment, best
practices dissemination, harmonization of practices, agility and
adaptability of technology creation.
Objectives for industry relations e.g. compliancy to regulations,
standards, de-facto standards, standardization strategy and policy,
IPR, licensing, supplier strategy, extend of supplier base, publications,
collaboration with institutes, creation and support of technology
ecosystems.
VALUE CHAIN
TECHNOLOGY ASSETS
PRODUCTIVITY
INTERNAL POLICIES
INDUSTRY RELATIONS
Properties of product technologies must satisfy qualitatively and quantitatively the product
offering objectives of a company. Company’s business model defines technology related
objectives concerning revenue logic, business scope and scale, value chain aspects and
supplier base. For example technology selections affect on potential technology supply,
supplier lock-in and change costs. Furthermore decisions and objectives on technology
assets’ lifecycle, proprietary ness, standards compliancy, scope and scale reflect product
offering targets and aspects of value chain objectives. Technology asset base determines also
productivity of a company in terms of product development speed, cost, competence and
resource needs, and lifetime costs due reusability and maintainability. Productivity is
influenced by existence of internal policies, commonality of operational processes and
practices, and agility of technology creation and use enabled by technology. Also objectives
for industry relations concerning standardization, regulation, intellectual property
management and collaboration with industry eco-systems, suppliers, competitors and
institutes are needed.
Impacts category of the framework
In the impacts category the main elements are tangible outcomes, business model, knowledge
based, transitional and dynamic, socio-economic and environmental impacts. The impacts
category of the framework is presented in Table 4.
Technology embedded in products and services cause tangible impacts when delivered by a
company. Management of technology has a significant consequential effect on the company’s
business model which is enabled by technology, investments and position of the company in
value chains and industry eco-systems. A company also creates and accumulates knowledge
through its activities that are directed by strategic technology management. On the other hand
tangible outcomes and company’s business model cause impacts in the market place,
diffusion of innovations, technology and industry evolution which can be observed over
technology lifecycles and trajectories. Finally, technology management causes social,
economic and environmental impacts through utilization of technology in tangible outcomes.
Table 4: Impacts category of strategic technology management framework (Sahlman and
Haapasalo 2011a, published by permission of Inderscience).
Main element
TANGIBLE OUTCOMES
BUSINESS MODEL IMPACTS
KNOWLEDGE BASED IMPACTS
TRANSITIONAL AND DYNAMIC
IMPACTS
SOCIO-ECONOMIC IMPACTS
ENVIRONMENTAL IMPACTS
Definition
Impacts of technology management by technology manifested in
delivered products and services.
Impacts of technology management to the company’s offering, value
creation system, industry clusters, revenue logic, value creation and
productivity.
Impacts of technology management on skills, competence, data,
information, knowledge and wisdom embodied in people and
enterprise capabilities.
Impacts of technology management that can be observed as
phenomena in the market and environment.
Impacts of technology management on social welfare and people’s
behavior.
Impacts of technology management to natural resources
consumption, materials exploitation and waste.
Validation of the framework
The entire framework was validated after completion of the categories by interviewing five
experienced industry practitioners who all had at least 25 years of experience in hightechnology companies. The validation was conducted as evaluation of the relevance and
current state of the framework elements in scale from 1 to 10. Evaluation results are
presented in Appendix 1.
Relevance of the elements was evaluated on average from 8.0 to 9.4. Methods, tools and IT
systems element scored 7.0 being seen as least relevant in structures category, and socioeconomic and environmental impacts in impacts category scored 7.2 and 6.0. Nevertheless
methods and tools were stated to be relevant in large companies and role socio-economic and
environmental impacts were seen to be increasing. The current state of the elements was
evaluated by the interviewees on average from 6.2 to 7.6 indicating that the practices are not
systematic in companies, especially artifacts element in structures category scored 5.2.
Collaboration networks got the highest score at 8.0, reflecting the necessity of networked
mode of operation in global high-technology companies.
On average all the elements were seen relevant and their substance was understood by the
interviewees. They also were able to associate and link the elements with business
management and enterprise strategy. Interviewees stated that it is important to see the whole
picture related to strategic technology management for which the framework was seen to
provide a logical structure. Also positioning technology management in strategic dimension
was seen right. Distinguishing strategic technology management clearly from R&D
management was seen beneficial to improve visibility to technology matters, decision making
and to technology strategy execution.
THEORETICAL CONTRIBUTION
The research problem i.e. lack of comprehensive frame of reference for strategic technology
management was approached by developing a conceptual framework that describes the
elements of strategic technology management in strategic dimension. The main theoretical
contribution of this paper is the synthesized logical framework model for strategic technology
management. Thus, knowledge of strategic technology management school (see Drejer, 2004;
Phaal et al., 2004; Lichtenthaler, 2008) is enhanced.
The framework is built on the integrated management theory of Bleicher (2004) and enhances
previous technology management models (e.g. Gregory, 1995; Luggen and Tschirky, 1991)
that are typically focusing on specific aspects of technology management like processes,
functions, routines or methods and tools (see Table 1). In the framework, Gregory’s (1995)
five process model, identification, selection, acquisition, exploitation, protection, is
suggested to be enhanced by strategic planning, technology development and technology
disposal. Cetindamar et al. (2009) suggests that learning should also be included in the
process framework for technology management.
In addition, contemporary thinking on challenges of strategy execution high lights
management of strategic initiatives and objective setting for organizational entities (e.g.
Kaplan and Norton, 2005; Mankins and Steele, 2006). Instead, for applying the framework,
transformation of business objectives into strategic objectives for technology is proposed.
The framework also connects aspects of the company’s internal and external influence of
strategic technology management with socio-economic environment.
For the creation of the framework, organizational management, technology management and
strategic management theories were applied. The framework unites socio-economic and
environmental context with enterprise management concerning technology aspects, which is
useful for theoretical consideration of technology management as an own managerial
discipline in a multifunctional organization.
MANAGERIAL IMPLICATIONS
The purpose of this research was to outline a conceptual framework on strategic technology
management to assist practitioners in definition and development of the practices in
enterprises. The substance of the framework is reflecting conceptions of scholars and
practitioners in the field. The framework presents essential topics, viewpoints and
interrelations of strategic technology management issues in enterprises. It also considers
technology management in larger socio-economic context, thus increasing awareness of the
impacts of strategic technology management.
Enterprises should consider technology management as an own managerial discipline in
strategic dimension together with e.g. business and product portfolio management. Typically
technology management is seen as an implicit function, most often embedded in R&D
management. For the purpose of developing strategic technology management as an explicit
practice the framework provides a frame of reference for the necessary structures i.e.
artifacts, processes, methods, organizational functions and governance, and collaboration
networks.
The framework also highlights importance of strategic objectives setting for technology.
Typically, strategic objectives are related to business topics and they are targeted for
organizational functions and activities, market positioning and key performance indicators of
the business. Instead, strategic technology management objectives should be directed on
properties and attributes of technologies used in a company. Therefore a transformation of
business objectives to technology objectives is needed through strategic technology
management activities. In this respect, the main considerations are related to managing
technology over product life-cycles and assessing technology gaps versus business
objectives. Thus creation, deployment, maintenance, reconfiguration and fusion of
technological capabilities of a firm are in the focus as industries, markets, products and
technologies evolve over time.
Along the logic of the framework model, the objectives of strategic technology management
to technology are related to product offering, value chain, technology assets, productivity,
internal policies and industry relations. When the objectives are realized in industry and
socio-economic context of the company through structures and operational activities, the
activities influence on technology infrastructure of the company and create external impacts
and have an influence on technological capabilities. Consequently, the generated capabilities
and impacts cause technology and industry evolution, and creates wealth and social change.
The developed framework is intended to assist practitioners for identification, discussion,
communication and presentation the complex managerial field of strategic technology
management.
CONCLUSIONS
In this paper, the results of the four research phases are concluded as synthesized framework
for strategic technology management in high-technology enterprise context. In an
increasingly complex and dynamic environment practitioners in enterprises are facing a
challenge how to strategically manage technology to sustain the company’s competitiveness.
While companies have evolved to multifunctional strategic orientation where technology has
a significant role, there still is no comprehensive frame of reference for strategic technology
management. The synthesized framework for strategic technology management answers to
the RQ ‘What are the elements of strategic technology management in high-technology
enterprise context’.
The research was conducted in large and small to medium-sized enterprise high-technology
enterprise context. The framework was developed based on literature findings and using
questionnaires and documents to acquire data for analysis and abductive reasoning to
describe a possible solution to the research problem. The entire framework was validated by
interviewing experienced practitioners in high-technology companies.
The framework for strategic technology management consist categories of structures,
objectives and impacts in strategic dimension. The categories are formed from six main
elements each containing several sub-classes.
The main theoretical contribution of the research is the framework that provides a logical
structure to elements of strategic technology management. The framework unites strategic
management, organizational management and technology management viewpoints to
enterprise management, and enhances knowledge in strategic technology management.
As the main managerial implication it is proposed that companies should define systematic
practices for strategic technology management, and integrate it with other managerial
disciplines as an own managerial function. For practitioners the framework provides a frame
of reference for conceptualization and organizational development of strategic technology
management.
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APPENDIX 1 Framework validation results
Table 1: Evaluation results of the framework validation: relevance of the element. Scale for
evaluation: Not relevant 1, extremely relevant 10.
ELEMENT
Evaluation results
Average
Structures
Artifacts
9
6
8
10
8
8.2
Processes
8
7
10
9
9
8.6
Methods, tools, IT systems
3
8
8
8
8
7.0
Governance
8
9
9
10
8
8.8
Organizational functions
8
8
10
10
9
9.0
Collaboration networks
9
10
10
10
8
9.4
Product offering
9
10
9
10
9
9.4
Value chain
9
10
2
10
9
8.0
Technology assets
9
9
9
9
9
9.0
Productivity
8
9
5
10
8
8.0
Internal policies
7
7
9
9
8
8.0
Industry relations
10
8
4
10
9
8.2
Tangible outcomes
5
10
10
8
10
8.6
Business model impacts
9
8
9
10
8
8.8
Knowledge based impacts
9
7
9
10
8
8.6
Transitional and dynamic impacts
9
9
6
10
8
8.4
Socio-economic impacts
3
10
7
10
6
7.2
Environmental impacts
2
10
1
10
7
6.0
Objectives
Impacts
Table 2: Evaluation results of the framework validation: current state of practice. Scale for
evaluation: Not established 1 - Well established 10.
ELEMENT
Evaluation results
Average
Structures
Artifacts
5
6
3
7
6
5.4
Processes
5
7
7
5
7
6.2
Methods, tools, IT systems
9
8
8
6
5
7.2
Governance
8
7
10
7
6
7.6
Organizational functions
8
8
8
6
8
7.6
Collaboration networks
8
9
10
6
7
8.0
Product offering
6
8
8
7
8
7.4
Value chain
9
8
1
7
7
6.4
Technology assets
7
8
8
7
6
7.2
Productivity
6
8
5
8
7
6.8
Internal policies
4
7
8
7
6
6.4
Industry relations
8
8
5
8
8
7.4
Tangible outcomes
8
7
8
8
7
7.6
Business model impacts
9
8
9
6
6
7.6
Knowledge based impacts
7
7
7
8
6
7.0
Transitional and dynamic impacts
5
7
6
7
6
6.2
Socio-economic impacts
5
8
7
6
6
6.4
Environmental impacts
9
8
2
8
7
6.8
Objectives
Impacts