Techmanagement - Forecasting- WiWi Module SoSe2018.pptx ...

Institut für

betriebswirtschaftliches

Management im Fachbereich

Chemie und Pharmazie

Technology Forecasting

Marius Chofor Asaba

Marius Chofor Asaba I

Expected Knowledge Stack

Technology Management

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What is technology Forecasting (TF)?

What importance does TF have in Technlology Management?

What methods can I use for forecasting?

When is it best to use TF?

What are the strengths and weaknesses of TF?


Agenda

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1 Introduction

2 Methods

3 Case Study on Delphi

Anticipation of industry convergence


Introduction: How Tech Forecast defined?


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• Forecast: a probabilistic statement, highly confident about the future

• TF: probabilistic assessment, on a high confidence level of future technology transfer

• Provides information about the direction and rate of technological changes

• Note: it does not predict the precise for technology will take in respect to a future

date


Introduction: Why is Tech Forecasting Important?


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It uses logical processes to generate explicit information to help industry and

government anticipate practical, ecological, political and socual consequences of

developments in technology


Introduction: Why is Tech Forecasting needed?


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• To orient future R&D

• To prevent the import of obsolete technologies

• To anticipate technical innovation

• To assist the shift towards appropriate technology

• For effective technology transfer and Development of exportable technologies

• Rapidity of innovations and to avoid surprises


Introduction: Elements of forecasting


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A time horizon

A specific technology (Qualitative)

Some parameters to the technology (Quantitative)

A probability statement about the outcome


Introduction: Elements of forecasting


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Time:

Resource-time relationship

Qualitative:

Identification of factors likely to

change the activities/tech trends in

areas of interest

Quantitative:

Measurement and Assessement of

level of performance of various

technologies

Propability of occurence:

Prediction of different alternatives

and their level of confidence


Introduction: TF Background


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After WW2 there was technological explosion in growth

Following the radical growth in technological development, competition became intense

and unpredictable

US space and defence industries implemented TF in the 1940s and 50s

The US used TF as a tool to keep its technology ahead of the Russians during the Cold War

Technology change -> modification of government policy | loss of market share | loss of a

market


Introduction: Strategic Rationale and Implications


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The products a firm markets, the processes a firm uses or the equipment it use may be

superseded (outdated)

Competitors have an advantage

Can gain a price advantage over competitors by investing in more efficient technological

processes

Internal functioning of a business relies on technology

Technological forecasting predicts the future developments by anticipating the probable

characteristics and timing of technology


Introduction: What can be predicted?!?


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Misconception: technology is a quite specific physical entity | it has no variable

characteristics dependent on probability statements

Meaning precise technologies will exist in a specific given situation only

Truth: Technology is not am immutable piece of hardware or a bit of chemistry | It is simply

„knowledge of physical relationships“

It can range from initial basic ideas of how to apply a solution to a practical problem up to

an end product, device, or production machine

Basically any technology has a wide and relatively continuos range of characteristics in

various applications over a give time period




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Agenda

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1 Introduction

2 Methods




TF methods


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Exploratory forecasting:

Delphi method

Analytic method

Multivariante analysis

Trend extrapolation

Growth models

Brainstorming

Scenario writing

Substitution analysis

Input-output models

Monitoring

Normative forecasting:

Operations research models

Network techniques

Cross-impact analysis

Relevance trees

SEER

Morphological analysis

Dynamic modeling


TF methods


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Qualitative methods:

- Are subjective, based on the

opinion and judgement of

consumers/experts

- They are appropriate when past

data are not available.

- They are usually applied to

intermediate- or long-range

decisions

- e.g. Delphi, market research

Quantitative methodes:

- Used to forecast future data as

a function of past data

- Appropriate to use when past

numerical data is available and

when it is reasonable to assume

that some of the patterns in the

data are expected to continue

into the future.

- These methods are usually

applied to short- or

intermediate-range decisions

- E.g. poisson process model-

based


TF methods: Exporatory methods


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Starts with the present state of technology and quantitatively projects future possibilities

Provides a means for exploring the shape of tomorrow given the state, trends, and

promises of today

Applicable in systems which grow under a specific environment

Methods

Intuitive Extrapolative Growth curvesTechnological

monitoring

Technological

monitoring


Based on the ability of one or more experts to assess the future



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Intuitive methods

• Individual forecasting: experts in specific fields prepare forecasts in their field

Lacks multidisciplinary interaction and is often biased (High probability to failure)

• Opinion polls: opinions are gotten from several individuals and combined

Minority opinion is drowned by majority opinion irrespective of significance

• Panels: Group of experts interact across a table (multidiciplinary advantage)

Extreme views are eliminated | Dominance influence | Stuborness | Hierachical fear

• Brainstorming: Frank and free unconventional alternative search technique (mostly

used in situations where unconventional alternatives are needed)

• Scenario writing: creative method of deriving possible composite scenario


DELPHI Method: Expert opinion



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Intuitive methods

• The delphi is a group process technique for eliciting, collating and generally directing

expert judgment towards a consensus on a particular topic.

• If the general questions are asked then the panel should have representatives from a

variety of disciplines

• Experts are expected to have specific experience

• A facilitator is needed to co-ordinate the process and send a questionnaire or survey

to each of the experts (anonymously)

• Facilitator collects and combines responses, and clarifies any issues leading towards

finding a consensus


• HOW?

- Consider change over a period of time

- Understand the factors that have driven that change

- Predict the future change from this knowledge

• Generally statistics are plotted onto a graph against time

• Limit analysis may be used to check the utility of a trend extrpolation plot

• May be used to forecast future technology that has a precursor technology with a

known path of change

• The shape of the curve for the presursor is used as a guide

• May also predict future ones on the basis of judment



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Extrapolative

methods

Extrapolative

methods




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Extrapolative

methods

Extrapolative

methods


„S“ shaped fashion curves with a finite limit showing technology capabilities growth



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Growth Curves

Can be used to assess future profitability of a product

Most commonly used models of growth curves:

• Pearl curve

• Gompertz Curve

• Fisher-pry curve

Inflection

point

Upper limit of sales


Example of future estimation using Pearl curve



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Growth Curves




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Technological

monitoring

Technological

monitoring

• Monitoring of technological growth through the early signals of innovation

• Achieved by searching patents, radical alternatives and literature for the embryo of

new technology

• Software programs are available which facilitate this process

Multivariante analysis: Used in cases where the cause and effect of a relationship is not

obvious

- Dependent variable and the independent variable are analyzed

- Results gotten can be used in forecasting


TF methods: Normative methods


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Begin with an objective/goal and work backwards to the present to find the best approach

to realize the predetermined objective

Need-based: needed capabilities are identified for the achievement of the goals

Methods

Network

techniques

Network

techniquesSEER

Cross-impact

analysis

Cross-impact

analysis

Morphological

analysis

Morphological

analysis

Relevance

trees

Relevance

trees

Dynamic

modeling

Dynamic

modeling

Some methods are simple variants of techniques used in other areas and are mainly used

to eliminate subjective errors associated with intuitive forecasting techniques.




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• This is a method for structured thinking identifying all possible system alternatives

• The main idea is not to miss any options

• HOW?

- Starts with a goal you wish to achieve

- Gather information about technologies that may achieve a particular purpose

- List attributes you seek

- Display information in graphical form which highlights any gaps (gaps may represent

opportunities for developments)

• To make this process work, all possibilities must be considered

• Time and patience is required

Morphological

analysis

Morphological

analysis




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• Used to evaluated multiple choices where a number of steps may be available to

achieve a certain goal

Steps may be different in effectiveness in terms of cost, profit or probability of success

• Detailed hierarchies of methods for achieving a particular outcome

• This outcome is the question to answer a specific forecast

• It divides a broad subject/problem into increasingly smaller and more detailed

subjects

• Ideally there should be no overlap between items in the tree

Relevance

Trees

Relevance

Trees




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• Example for Pollution control

Relevance

Trees

Relevance

Trees

Develop

alternatives

to internal

combustion

engines

Develop

Petroleum

Tech. to

eliminate

pollution

causing

constituents

Develop external

combustion systems

Develop Batteries

Develop sulphur

removal process

Hybrid Car

Performance

Alternatives

Air

Pollution

control

Level 1

General

Objective

Level 2

Broad

Alternative

Methods

Level 3

Process &

Methods

Level 4

Performance

& cost

Level 5

Applied research

alternatives




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• Network techniques: Used for mission-orriented planning exercises, mainly to

analyse road blocks to achieve final target of objective (SOON: Sequence of

oportunities and negatives)

• System for Event Evaluation and Review (SEER): Modified variance of DELPHI, ideal

for corporate exercises | consist of a single round evaluation of events

• Cross-impact analysis: Different events interact with different strengths towards

other course of events | Interactions and random numbers are used to derive

combined forecast

• Dynamic modeling: computer aided structural modeling with time varying effects

Others


TF methods: Strengths and Advantages


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• Can inform current and future investment decisions throughout a business

• Provides Flexible process that can be tailored to a business

• Makes a variety of methods available to a firm

• Individual methods all have their own particular strengths:

- Delphi: Allows a firm to tap into the expertise of experts across a range of fields

- Trend extrapolation: uses statistical data to assist in the development of indicators

- Growth curves: usefully predict when a technology has reached maturity

- Relevance trees: identify the relationships between parts of a tech/process and its

potential development

- Monitoring: of patents and general research trends can give a firm warning of new

inventions


TF methods: Weaknesses and Limitations


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• TF is heavily dependent on the quality of the information and the validity of the

assumptions upon which it is based

• Firm‘s own staff may not be able to determine which factors are most important

• Personality of individual on project may infect the message

• TFs do not provide conclusive results and predicting probability is difficult to do

• Individual analytical methods all have their own weaknesses:

- Delphi method: Qualified experts are crucial

- Trend extrapolation /growth curves: future does not always follow the patterns of

the past, and dependent on the limits chosen for the analysis

- Relevance trees/morphological analysis: subject to human error, vulnerable to lack

of insight, and difficult to construct


TF methods: Criteria for Applying the techniques


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• Make use of searching questions relevant for applying the TF method:

- Is the system ready to absorb/contribute to arising technology needs of the society?

- Does the system have any mechanism to;

anticipate changes?

assess needed technologies?

assign strategies to implement the technologies?


TF methods: Criteria for Selection of the techniques


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• This is quite complex and depends on following factors:

- Purpose for which the forecast is being made

- Reliability needed

- Precision of the data

- Time period and resources are available

- Ability to combine various interacting factors

• Cost varies per method used (Modelling is the most expensive) and accuracy also

greatly influences this


TF methods: Criteria for Selection of the techniques


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The TF Techniques which can be used for

Problem

identification

Relevant factors Trends of

parameters

Relationships

among

parameters

Implications for

action


TF methods: Brain Teaser


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The TF Techniques which can be used for

Problem

identification

Relevant factors Trends of

parameters

Relationships

among

parameters

Implications for

action

Brainstorming Brainstorming Extrapolation Relationships

among

parameters

Expert opinion

Delphi Delphi Growth curves Dynamic

modelling

Scenario writing

Expert Opinion -Expert opinion

-Monitoring

-Scenario writing

Substitution -Cross-impact

analysis

-Relevance trees

Modelling and

simulation


TF methods: Application of technology forecasting


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Technique Questions it tries to answer Applications

Trend extrapolation Past versus future | Is there a rate change? | Why is the rating declining?

| Future performance levels | Total market size

R&D Market planning |

Corporate planning

Growth curves Is there a limit? | Sales growth of new product | Setting up new plant

capacity

New product identification |

Production

Delphi When can, will or should certain events occur? | Setting up goals | What

are the elements of future

R&D | Market research | New

product identification

Morphology Can we have a new way? | Did we consider all alternatives? | Listing

diversification alternatives

Value engineering design

Cross-impact analysis Can interaction of events delay or accelerate the growth? LRP R&D

Relevance tree Target-oriented planning | Problem solution convergence R&D

Mathematical modelling Thought provocation R&D of new products | How to assess alternative

policies? | How to change course of action to achieve a desired result

Policy analysis | R&D |

Production

Scenario writing Innovation stimulation | Consideration of all interactions Policy planning

Technology monitoring What are the new areas? | What are the likely new products? |

Prediction of break through threats to existing products

R&D | Production

Production demand /

replacement decisions

R&D marketing New product


Agenda

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1 Introduction

2 Methods




Delphi: Case Study


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Literature

• Business and Competitive Analysis; C. Fleisher & B. Bensoussan (FT Press

2007)

• 105th FoCARS, Foundation Course For Agricultural Research Service; D.

Rama Rao (NAARM, 2017)


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Techmanagement - Forecasting- WiWi Module SoSe2018.pptx ...

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