1-1Management of Technology

Taking Technology to Market

Commercializing Technology:

What the Best Companies Do

1-2Management of Technology

Taking Technology to Market

Develop or Sell Maximize Return on

Technology Investment Plan for Fullest Market

Exploitation of All Technologies– Sell for Lump Sum or Royalty

• Direct Sale• License

1-3Management of Technology

Exploiting TechnologiesKey Questions

Problems Involved in Selling Giving Away its “Seed Corn” ?

– Jeopardizing the Future How, To Whom, and When ? Relationship Between Sale of

Technology and Sale of Product Based on that Technology ?

1-4Management of Technology

Selling TechnologiesWhy ?

Costs and Risks of R&D Strategic Fit Limited Protection By Patents Control Technology Diffusion Financial or Production

Limitations Import Restrictions Antitrust Legislation

1-5Management of Technology

Technology Life CycleStage 1: Technology

Development Further Development

– Strategic Fit; Identifiable Market ?

– Financial Resources; Production/Marketing Capabilities

– Rate of Return ? Alternatives

– Partnership – Sell

1-6Management of Technology

Technology Life CycleStage 2: Technology

Application Technology To Be Applied To a

New Product High Costs --- New Processes Produce, Sell, or License ?

– Development Costs– Projected Revenues– Cash Position– Perception of Importance

1-7Management of Technology

Technology Life CycleStage 3: Application Launch

Factors Against Licensing– Lack of Skilled Buyers Could Damage Technology’s Reputation

– Long Lead Times– Government Restrictions– “Not Invented Here”– Purchaser’s Resistance to Change– Greater Market Acceptance (Seller)

1-8Management of Technology

Technology Life CycleStage 4: Application Growth

Market Value of Technology at Maximum

Timing is Crucial Factors to Consider

– Market Size– Technological Leadership– Standardization

1-9Management of Technology

Technology Life Cycle

Stage 5: Technology Maturity– Timing Not Crucial– Production Costs Key

Stage 6: Degraded Technology– Third World Markets (not only technology but also experience)

– Technology Middlemen

1-10Management of Technology

Technology SalesMarketing of Technology

Coherent Strategy for Full Portfolio of Technologies

Acquisition/Divestment of Individual Technologies

Value of Direct Sale License/Product Sales

Relationship Reliance on Technology

Marketers

1-11Management of Technology

Technology SalesThe Best Strategy

“To seek both wide application

and standardization of a technology while discouraging other companies from producing substitute technologies”

1-12Management of Technology

Commercializing Technology:

What the Best Companies Do

Commercialization of Technology/ New Product Development; Battleground of the 90s and beyond

Leading Companies – More New Products and Processes– More New Technology– Fast to Market– More Markets

1-13Management of Technology

Commercializing Technology

The Commercial Imperative Proliferation of New Technologies

Rapid Obsolescence of Existing Technologies

Shrinking Product Life Cycles Technology Diffusion Cost of Technology Development Fragmentation of Markets

1-14Management of Technology

Commercializing Technology:

Measuring Commercialization Capability

Time to Market

Range of Markets

Number of Products

Breadth of Technologies

1-15Management of Technology

Introduced six month late

-31.8%

-14.9%

-3.8%

-3.8%

-2.3%

Loss of Profits

Quality problems -> 10% price discount

Comparability problem -> 10% volume reductionProduct cost goal exceeded by 10%

R&D budget overrun by 10%

1-16Management of Technology

Commercializing Technology:

Building Commercialization Capability

The Commercialization Process Make Commercialization a

Priority Set Goals and Benchmarks Build Cross-Functional Skills Promote Hands-On

Management to Speed Action and Decisions