Conceptual Development of Technological Opportunities - Essay Example

? Exploitation of Technological Opportunities by Organizations s: EXPLOITATION OF TECHNOLOGICAL OPPORTUNITIES BY ORGANIZATIONS Introduction This paper examines the manner in which organizations exploit technological opportunities and the importance of possessing the ability to exploit these opportunities. In particular, the paper studies two major characteristics inherent in technological opportunities. One is the short opportunity window and the various perceptions concerning the value of the opportunity to the organization, both in the promotion of the opportunity and the prolonging of its exploitation. A distinguished characteristic of these opportunities is the fact that they are temporary that is, the organization that discovers them needs to exploit the technological opportunity swiftly before it gets to the organization’s competitors (Andersen, 2011: p54). They also need to do this because the opportunity could be quickly replaced by a technology that is more advanced. The organization, therefore, must hurry before the opportunity window ends. Research has shown that organizations, which come up with technological discoveries, in most cases, do not have the resources required to exploit them quickly. In this case, the organization is encouraged to collaborate as an efficient means of accessing complementary or additional information that could help speed up the exploitation process. The importance of exploiting these opportunities as fast as possible as opposed to simply being in their possession cannot be overemphasized. The importance of technological opportunities lies in the ability to exploit it rather than the technology itself. Collaboration in Exploitation of Technological Opportunities Beginning in the mid 70s, the biotechnological industry has seen tremendous growth with increased innovations and new technologies. Several hundred firms with intensive Research and Development programs have entered the industry in the last forty or so years. Pharmaceutical companies have also been highly involved in the pursuit of biotechnological opportunities, for instance, through entering into collaborations on biotechnological advances with the new organizations. These collaborations are meant to exploit the opportunities in biotechnology that were discovered previously by the new biotechnological organizations (Archibugi & Michie, 2012: p34). An interesting feature in the exploitation of these collaborations is that their set up is widely varied in whether these opportunities are utilized at all and at what stage their utilization takes place, if at all. The timing of collaboration to exploit the biotechnological opportunity between the discoverer and the pharmaceutical firm is vital. Studies have shown that new biotechnological organizations vary in when they time their collaborations to exploit their opportunities when compared to pharmaceutical firms (Antonelli, 2010: p21). Biotechnological organizations that have rigid research and development programs that apply for patents in their projects or that possess earlier experience in research and development, exploit their opportunities sooner through collaboration. Collaboration is also accelerated by the establishment of industry infrastructure, for instance, national biotechnological centers, as well as increased protection of intellectual property. It was found that the project’s characteristics do not have a profound effect on the collaboration’s timing. While many biotechnological opportunities were initially focused on the phase of discovery, the exploitation phase has become more important as new technologies are discovered that replace previous ones (European Commission, 2010: p149). Identification of opportunity is now viewed as only being necessary, but not adequate for the actual technological exploitation. Because most of the start-up biotechnological firms do not have the required capital to exploit these opportunities, it is vital that they collaborate, with larger organizations, to make the most out of the opportunity. Governments have also come to the realization that the exploitation of these opportunities is vital to the development of the health sector, rather than just possessing the knowledge and as such, have collaborated, with these companies, to exploit their technological discoveries (European Commission, 2010: p151). Conceptual Development of technological Opportunities For organizations, the right timing of when to exploit an opportunity is vital. While the organization may discover the opportunity before its competitors do, the window for this opportunity has a short self-life (DeGeeter, 2012: p31). These opportunities decrease in their lucrative value as other organizations discover the potential uses of the new technological discovery and begin its exploitation. Alternatively, the competitors could promote an alternative but similar technology parallel to the previous one that may act as a substitute for it. These technological advances may also be replaced by more recent technological discoveries if they are not exploited fast enough. Therefore, in this highly competitive industries where opportunity windows pass quickly, attaining access, to technological know-how and resources to exploit them quickly can be the difference between improving the organization’s bottom line significantly or totally missing out on the opportunity (DeGeeter, 2012: p34). The best way for these organizations with new technological discoveries to exploit them as quickly as possible is through collaborative efforts (Ford, & Saren, 2011: p39). Organizations that elect to collaborate early in the technological opportunity cycle have the ability to secure access to essential resources from external sources. Early exploitation of the opportunity also frees the resources that the discovering organization has to focus on new technological research. However, collaboration can be problematic, especially since knowledge; tacit is high during the technology’s early stages and decreases as development of the technological knowledge is expanded. This tacit makes collaborative efforts difficult in exploitation of technological discoveries because it limits the ability, which the organization has to articulate its discovered knowledge concerning the opportunity for efficient reception and transmission. Therefore, value inherent in tacit knowledge usually appears ambiguous to those looking at it from the outside. In addition, the technological opportunity discoverer’s perspective shows that tacitness can alter the knowledge to become vulnerable for use by its competitors. It is difficult to protect expertise that has yet to be articulated (Ford, & Saren, 2011: p40). The argument on appropriation of technological knowledge is important, especially in the case of technological opportunities discoverers since the core asset of most organizations, especially those in the biotechnological industry, lies in the tacit knowledge that they develop (Dosi, 2009: p76). It has been demonstrated that development of products is essential in the reduction of appropriation articulation uncertainties, which may make early exploitation of opportunities, for instance through collaboration, difficult. This process can be described as expertise codification or deliberate un-sticking, in which case tacit knowledge is altered to more defendable and explicit forms, for example, blue prints and formulas. Therefore, one way to cause a reduction in this tacitness is to wait for the project to develop further (Dosi, 2009: p76). However, those discoverers who do not have enough resources to exploit their technological discoveries cannot afford to wait until their project is further developed due to the dangers discussed. This is especially so because most technological opportunities and discoveries are time sensitive (Hillson, 2009: p22). Unless there is a way to access these resources quickly, there is every chance that this opportunity may become significantly less attractive to the market or vanish altogether. Therefore, those organizations who find themselves in the ownership of new technological discoveries must speed up its exploitation, preferably in the earlier stages of product development. Exploiting Technological Opportunity’s Business value A common role, which modern organizations that deal in technology have, is the discovery and introduction of new discoveries in technology. This, in turn, enhances the business objectives of its parent organization (Lennon, 2011: p19). When this role is executed properly, it enables the organization to use its technology to enhance real bottom line value via the enhancement of breakthroughs in competitive differentiation, operational effectiveness, services, and products. In order for the organization to be successful in the stated role, it must have the ability to think extensively, outside the box, in the application of technological opportunities in creative and new ways. Additionally, it should have a working knowledge of technologies, which are in the embryonic stage and others that are available, and a strong comprehension of its business to recognize the emergence of an opportunity that can be served by technological advances. Considering the potential benefits that new technological opportunities offer to organizations, most of them can raise their value significantly through the enhancement of their capabilities in enhancing their technological evaluation (Pavitt, 2011: p55). Organizations must gain new perspectives on the evaluation of technology. They should look at new technology from the perspective of business as opposed to technology delivery. For instance, every breakthrough in capabilities of wireless technology provides various business functions with new mobility. The organization needs to evaluate the functions of its business that would most benefit from the offered mobility. On top of monitoring unforeseen and new advances, the organization must also seek ideas proactively that will be possible to pull off in the future through yet to come advances. For example, when wireless technology of the third generation arrives, its increased bandwidth will enhance the capability of organizations to offer real time access to its sales team on customer information during calls on sales. Planning for the capability to do this before it becomes reality will enable a faster roll out when the expected increase in bandwidth becomes reality, which will enable the organization to reap the benefits before its competitors get in on the act (Pavitt, 2011: p56). Organizations also need to create research groups for applied technology. This is because the ability of the organization to capitalize on the capabilities that are offered by the emerging technology is too vital to be assigned as a part time indulgence (Porter & Cunningham, 2008: p61). Although most organizations that deal in technology already have dedicated resources for examination of the technology’s implications on development processes, formal architectures, and standards, these groups tend to be focused on technology and driven by technical aspects. A separate group needs to be launched whose focus is on research into the implications that the technology will have on the business. The group also needs to be staffed with employees who are open-minded technical and business people. This group needs to be unafraid of rising up to challenge the status quo. Combining good business skills with technical expertise enhances the likelihood of the organization identifying those opportunities that add major value to the organization. These individuals are required to be of high thinking level (Wiley, 2011: p52). Finally, organizations are required to invest in research. In the current era of high-tech complexities tied to an overload of information, the magnitude of difficultly in looking through all the opportunities available to an organization has increased (Roberts, 2011: p71). Too frequently, hype behind a technological opportunity overshadows the actual capabilities that these technologies hold, which presents a challenge to the organization in finding opportunities that work in actuality. In order to ensure that the organization has covered all bases, it is vital to invest in a collaboration of development of analytical skills within the organization, conference attendance, and analyst research. The potential value that applied technology has on the business side of an organization cannot be overstated. For instance, Barnes and Noble had the technological opportunity to launch online bookstores before Amazon while the New York Times was in possession of a portal before the development of Yahoo (Roberts, 2011: p72). It is clear that simply possessing a technology has little or no value. It is what the organization does with this technology that will impact on its business side. How Eastman Kodak and Fujifilm Differed in Exploiting Technological Opportunities….and the Results One example of a company that was in the possession of a technological opportunity but failed to utilize it was Eastman Kodak Company. The criticism levelled at Kodak for the slow manner in which they responded to the advent of the digital age was blamed on the company’s complacent nature of monopoly. This was coupled to its conservative culture, which had a negative impact on the company’s ability to embrave technology that it invented, such as the digital camera that it invented in the 70’s (Baron, 2010: p40). The Company’s CEO during this period, Clay Chandler was supportive of a divestive and innovative culture at Kodak. The in-coming CEO, however, benched the policy and stopped various promising ventures aimed at the future, instead decidinmg to follow a policy of resource selection, as well as concentration. Through the adamant decision of continuing to use film, Kodak ignored the technological opportunity present at the company in digital printers and cameras, preferring to categorize the company as an “image company”. Kodak, therefore, was forced to file for bankruptcy because it concentrated its resources on a narrow business field, which stood in the way of exploiting its own technological opportunities (Baron, 2010: p47). Another company that faced the same dilemma was Fujifilm, which, in many aspects, possessed a business trajectory that was comparable to Kodak during its founding. The major changes, which were steered in by the digital age and the threat projected onto the film indusrty by the digital revolution saw Fujifilm attempt to diversify its business. The company decided to exploit the digital camera and printer innovations that were still in their nascent age. Because the company was vertically oriented, unlike the horizontal orientation utilized by Kodak, Fujifilm was able to incubate the technological opportunities (Baron, 2010: p48). In 2001, the company merged, with Xerox, to develop digital appliances in an inspired move that soon supported the company’s financial standing. By exploiting the opportunity afforded by digital technology, Fujifilm was able to maintain a share of the market, different from Kodak. Conclusion It is fine for an organization to come up with innovative technology. However, if the organization does not see the opportunity and exploit it to increase its business, then the technology becomes a figurehead with no advantages for the company. For start-up companies that do not have the resources or expertise concerning how to exploit technological opportunities, collaborations are the best way to go. The technology will have to be exploited for it to add value to the organization. Failure to do this could see a competitor exploit the technology and improve on its business at the expense of the pioneering organization, or even come up with substitute products before the original opportunity is exploited, rendering it redundant. The strength of organizations that deal in technology is their evaluation and exploitation of opportunities, rather than coming up with the technology. References Andersen, B., 2011. Technological change and the evolution of corporate innovation. Cheltenham: Elgar. Antonelli, C., 2010. Handbook on the economic complexity of technological change. Cheltenham : Edward Elgar. Archibugi, D. & Michie, J., 2012. Technology, globalisation and economic performance. New York : Cambridge University Press. Baron, D., 2010. The Kodak-Fuji film trade dispute. Stanford: Stanford Junior University Butler, J., 2011. Opportunity identification and entrepreneurial behavior. Greenwich : Information Age Publ. DeGeeter, M., 2012. Technology commercialization manual : strategy, tactics, and economics for business success. Champaign : Med-Launch, Inc. Dosi, G., 2009. Innovation, organization and economic dynamics. Northampton : Edward Elgar. European Commission. (2010). 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