TM -1

Technology Management & Competitive Advantage

Jason C. H. Chen, Ph.D.Professor of MIS

School of Business AdministrationGonzaga UniversitySpokane, WA 99223chen@gonzaga.edu

TM -2

Environmental Drivers

EnvironmentalDrivers

Timecompression

TechnologyIntegration

Globalization

TM -3

Management Decision and Competitive Advantage

Value Drivers

ManagementDecision

Speed

Value

to learn, adapt,innovate

( )

Technology

Innovation

Competitive Advantage

Revenue generation

Costreduction

Costavoidance

Creating Value & Agent of Change

TM -4

Views on Technology andTechnology Management

Technology(forefront of the change)

(productivity gains)Technology Management

1. accomplish goals of an organization2. development of technological capability and its implementation or deployment in products and processes3. link to other management activities, e.g., marketing or manufacturing

Definition: Technology management focuses on the principles of strategy and organization involved in technology choices, guided by the purpose of creating value for investors.

1.Opportunity2. Appropriability3. Transferability4. Resources

TM -5

Views on Technology andTechnology Management (cont’d)

Technology(forefront of the change)

(productivity gains)Technology Management

1. Market-based2. Resource-based

1. Value chain2. Industries as competitive domain3. Forms of technological change4. Value creation

ComplementaryPerspectives

KeyConcepts

TM -6

Views on Technology andTechnology Management (cont’d)

Technology(forefront of the change)

(productivity gains)Technology Management

ComplementaryPerspectives

KeyConcepts

Value

TM -7

Table 1.1 Market-based and Resource-Based Views

Dimension Resource-BasedMarket-Based

Drivers of strategy Customers and competitors

Unique resources

Derivatives Resources Market opportunities

Strategy profile Positional Core competencies

Appropriate context Mature markets Dynamic markets

TM -8

Figure. Evolution of Management of Technology

1950 1970 1980 1990s & Beyond

R&DManagement

New venturedivisions

Linking tobusiness

Broader visionof technology

Outsourcing

Tools to assessvalue

Internal markets

Allocation of Funds to projects

Scientists &engineers

Leadership

Innovation Management

Differentorganizational arrangements

Managementof

Innovation

TechnologyStrategy

Value-BasedManagement

Era of Plentiful Resources Era of Accountability

Chief Technology Officer/Chief Information Officer/Chief Value Officer

R&D Manager

TM -9

Figure. Management of Technology

WHY

HOWWHAT

Management of Technology

TechnologyStrategy

Organization &Management

Purpose: value-driven

TechnologyChoices

principle principle

guided by

guided byguided by

Deployment in Products/Services

focus

Development of Technological Capability

focus

TM -10

Figure: Levels of Knowledge/Development

Intuitive/Tacit

Codify,Verify

Develop

Physically EmbodiedProducts, Services and Processes

ScienceFormalized Knowledge

TM -11

FIVE COMPETITIVE FORCES MODEL

THE FIRM TRADITIONAL COMPETITORS

NEW MARKET ENTRANTS

SUPPLIERS

SUBSTITUTE PRODUCTS & SERVICES

CUSTOMERS

Threats

Bargaining power

N

TM -12

Value Chain Model and its Activities

Inbound Logistics Operations

Outbound

Logistics

Marketingand Sales

Services

Administrative and Other Indirect Value Added

Primary Activities

Support Activities

TM -13

Manufacturing Industry Value Chain Product and Service Flow

Research and Development

EngineeringProduction

and Manufacturing

Marketing Sales and

Distribution Service

Primary ActivitiesDr. Chen, The Trends of the Information Systems Technology

Administrative and Other Indirect Value Added

Support Activities

N

TM -14

Manufacturing Industry Value Chain Product and Service Flow

Research and Development

EngineeringProduction

and Manufacturing

Marketing Sales and

Distribution Service

Primary ActivitiesDr. Chen, The Trends of the Information Systems Technology

Administrative and Other Indirect Value Added

Support Activities

N

TM -15

The Value Chain

Competitive

Adva

ntag

e

(Value)

N

TM -16

Examples of the Value Chain

NDr. Chen, The Trends of the Information Systems Technology

TM -17

Views on Technology andTechnology Management (cont’d)

Technology(forefront of the change)

(productivity gains)Technology Management

ComplementaryPerspectives

KeyConcepts

Value

IT Planning: The Relationship Between Business, IS, and IT Strategies

TM -19

Project Management and the Role of CTO/CIO

Value Drivers

ManagementDecision

Speed

Value

to learn, adapt,innovate

( )

Technology

Innovation

Competitive Advantage

Revenue generation

Costreduction

Costavoidance

Creating Value & Agent of Change