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The Commercialization of Technology Dr. Michael Stankosky.

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Presentation on theme: "The Commercialization of Technology Dr. Michael Stankosky."— Presentation transcript:

1 The Commercialization of Technology Dr. Michael Stankosky

2 Peace and Prosperity Through Science and Collaboration OVERVIEW ENTREPRENEURSHIP ENVIRONMENTAL ASSESSMENT GLOBAL OPPORTUNITIES FOR ENTREPRENEURS INNOVATION ECO-SYSTEM QUESTIONS 2

3 Peace and Prosperity Through Science and Collaboration ENTREPRENEURSHIP 3

4 Peace and Prosperity Through Science and Collaboration Good work, but I think we might need just a little more detail right here. Yet so far! 4

5 Peace and Prosperity Through Science and Collaboration Entrepreneurship: An Evolving Concept entre prendre - meaning to undertake The Entrepreneur: Characteristics –Personal initiative –Ability to consolidate resources –Management skills –Tendency towards autonomy –Risk taker –Competitive –Goal-oriented –Aggressive –Ability to employ HR Definition and History –No specific definition –History dates back to the 1700s in France –Linked to free enterprise and capitalism 5

6 Peace and Prosperity Through Science and Collaboration The Entrepreneurial Revolution Entrepreneurs: Challenging the unknown –Recognize opportunities –Athletes, Top Gun Pilots, Symphony Conductors Entrepreneurship: A Perspective –Dynamic perspective –More than just starting a business –Attitudes An Entrepreneurial Economy –Predominance of small firms and new ventures –10 years - 600,000 new businesses incorporated –90% of the business population –Provides net new jobs –Key to the US success economically 6

7 Peace and Prosperity Through Science and Collaboration Understanding the Entrepreneurial Perspective in Individuals We need a person, in whose mind all of the possibilities come together, who believes innovation is possible, and who has the motivation to persist until the job is done. Entrepreneurs as the cornerstone of the American enterprise system - Frank Carey of Pizza Hut –Driven by commitment –Determined perseverance –Work very hard –Optimist –Strive for integrity –Competitive desire to excel –Failure is tool for learning –Confidence in themselves 7

8 Peace and Prosperity Through Science and Collaboration Major Themes that Characterize Entrepreneurship Entrepreneurial and managerial domains overlap to a high degree Venture financing has emerged since 1980 Entrepreneurship within large enterprises has gained much attention There are key entry patterns and strategies to successful business start-ups Great variety of methods to start a new business Women and minority entrepreneurs have emerged in unprecedented numbers Worldwide entrepreneur growth Slow economic and social contributions Entrepreneurship education is in high demand 8

9 Peace and Prosperity Through Science and Collaboration ENVIRONMENTAL ASSESSMENT Market Assessment/ Evaluation of Entrepreneurial Opportunities 9

10 Peace and Prosperity Through Science and Collaboration Commercialization and Marketing Strategy A Framework for Marketing Management –Corporate Missions and Objectives –Assessment of Market Opportunities –Market Segments Targeted –Marketing Objectives –Strategy Development –Marketing Mix Formulated –Marketing Program Established –Tracking System –Evaluation and Control 10

11 Peace and Prosperity Through Science and Collaboration Environmental Assessment: Preparation for a New Venture Coping with the constantly changing environment is probably the most important determinant of a companys success or failure in a free enterprise system. Alan J. Rowe Environmental Scanning –Efforts of the entrepreneur for examining the external and internal environments before making a decision –External Environment - opportunities and threats outside the organization –Internal Environment - structure, culture, resources –Task Environment 11

12 Peace and Prosperity Through Science and Collaboration Macro View Assessing the Economic Environment –Questions to answer to avoid pitfalls Examples? –Attitudes and skills needed for a proper assessment Examples? –Understanding the regulatory environment A business must comply with governmental rules and regulations Government effect on small business –Tends in policy formation i.e., Small Business Regulatory Enforcement Fairness Act 12

13 Peace and Prosperity Through Science and Collaboration Marketing Research for New Ventures Marketing Research –What is it? Specific Objectives of Marketing Research –Six objectives Secondary Data –Information already compiled - Inexpensive - Sources? Primary Data –New information accumulated through observation and questioning –Surveys - Day to day data accumulation –Interpreting and Reporting the Information –Summaries, tables, charts –EIS? - KM system? 13

14 Peace and Prosperity Through Science and Collaboration Marketing Stages for Growing Ventures Entrepreneurial Marketing –Obtaining niche and credibility Opportunistic marketing –Market penetration Responsive Marketing –Develop the product market and create customer satisfaction Diversification Marketing –New business development and managing the product life cycle 14

15 Peace and Prosperity Through Science and Collaboration Marketing Planning Marketing Research –Process of determining who the clients are, what they need or want, how they buy Sales Research Marketing Information System –Compiles and organizes data relating to cost, revenue, and profit from the customer base –Effects strategies and decisions Sales Forecasting –Process of projecting future sales through historical data and statistical analysis Marketing Plans –Five Areas Evaluation 15

16 Peace and Prosperity Through Science and Collaboration Assessment and Evaluation of Entrepreneurial Opportunities Pitfalls in Selecting New Ventures –Lack of objective evaluation –No real insight into the market –Inadequate understanding of technical requirements –Poor financial understanding –Lack of venture uniqueness –Ignorance of legal issues 16

17 Peace and Prosperity Through Science and Collaboration GLOBAL MARKETS 17

18 Peace and Prosperity Through Science and Collaboration Global Marketing Objectives Exploiting market potential and growth Gaining scale and scope returns at home Learning from a leading market Pressuring competitors Diversifying markets Learning how to do business abroad 18

19 Peace and Prosperity Through Science and Collaboration Driving Forces Affecting Global Marketing Driving –Common Customer Needs (Market Needs and Wants) –Technology –Regional Economic Agreements –Transportation and Communication Improvements –Product Development Costs –Quality –World Economic Trends –Transferable Marketing (Leverage) –Global Channels 19

20 Peace and Prosperity Through Science and Collaboration Restraining Forces Affecting Global Marketing Restraining –Industry Factors –Internal Resources –Different Mixes –Global Turmoil –Management Myopia and Organizational Culture –National Controls and Barriers 20

21 Peace and Prosperity Through Science and Collaboration Global Opportunities for Entrepreneurs The International Environment Entering the International Marketplace –Conduct research –Prepare a feasibility study –Secure adequate financing –File proper documents –Draw up and implement the plan 21

22 Peace and Prosperity Through Science and Collaboration International Market-Entry Options Exporting Contracting –Licensing –Franchising –Contract manufacturing –Management contracts Strategic alliances Joint ventures –Advantages Provide path of entry into many foreign markets May open new market opportunities May provide relationship establishment with foreign authority figures 22

23 Peace and Prosperity Through Science and Collaboration Import Barriers Defined: –Any obstacle making it difficult for a firm to enter a product market Classification of Barriers –Tariff Barriers –Non tariff Barriers slow customs bureaucratic inertia in processing import licenses Government regulations Manufacturing access (suppliers, distribution channels) Natural barriers –Brand loyalty, promotional factors Advanced versus Developing Nations Exit Barriers 23

24 Peace and Prosperity Through Science and Collaboration The Exporting Option Exporting option often is the most attractive mode of entry to the global marketing newcomer Indirect Exporting –Hire a specialist to handle all of your export requirements –Export Management Company (EMC) Direct Exporting –Direct influence of the foreign marketing opportunity –Learn how to operate abroad –Develops a strategic involvement with the foreign market –Avoid extra agent fees Direct Exporting Functions –Review and Discuss the Functions listed in Exhibit 5.2 on page 136 Export Expansion Strategy –Waterfall Strategy - an orderly expansion of exporting –Sprinkler Strategy - quick penetration, preemptive first mover strategy Higher Risk - major commitments without the research and understanding of the market 24

25 Peace and Prosperity Through Science and Collaboration INNOVATION ECO-SYSTEM Management & Commercialization 25

26 Peace and Prosperity Through Science and Collaboration The Management of Technology Innovation Why do we innovate????? Patterns of strategic behavior –Induced strategic behavior From the corporate perspective Major investment –Autonomous strategic behavior Conceptually equivalent to entrepreneurial activity and introduces new categories of opportunity into the firms planning process Product championing and the informal network Product champion –Organization member who creates, defines, or adopts an idea for an innovation and is willing to assume significant risk to make possible the successful implementation of the innovation 26

27 Peace and Prosperity Through Science and Collaboration The Management of Innovation Igniting entrepreneurial spirit –Market for ideas Pursuing fresh ideas (resource attraction) that will create new business opportunities –Bringing in new voices into the opportunity seeking process, radically changing the believe that strategy is solely for senior managers Cross-functional barriers –Turf – areas of expertise –Interpretive – management opinions of tech project –Communication – interdepartmental 27

28 Peace and Prosperity Through Science and Collaboration Managing Technology Classifying development projects Derivative projects –Centers on incremental enhancements Platform projects –Design the design and components shared by a set of products Breakthrough projects –New core products, processes and services Research and development –Creation of knowledge that leads to new developments 28

29 Peace and Prosperity Through Science and Collaboration New Product Development Process New product strategy –Clearly defined strategy – particular product, market, and technology domains Anticipating competitive reactions Sources of Innovation (new product ideas) Lead users –Small numbers of highly influential buying organizations who are consistent early adopters of new technologies –Designed to unearth new product ideas and to identify a revolutionary approach to infection control –Staying ahead of customers –Proactively leading customers 29

30 Peace and Prosperity Through Science and Collaboration Evolutionary Forces Shaping Technology Strategy How a firms technology strategy changes over time Technology Evolution –S-curve trajectories Industry Context –structure, regime, assets to commercialize, emergence of designs, adoption of technologies, industry standards, social aspects, competitive effects Organizational Context –Ability to exploit opportunities –Spontaneous and flexible response –Ability to prioritize and balance challenges 30

31 Peace and Prosperity Through Science and Collaboration Taking Technology (Innovation) to Market Corporate management of technology requires –Careful planning of the relationships between Technologies (competencies) Markets Development Activities Levels of R&D depend on Available resources Competitive pressures Market requirements Process technologies - efficient product development Maximize R&D ROI –Fullest market exploitation of the technology Technology - From idea stage to direct sells 31

32 Peace and Prosperity Through Science and Collaboration The Technology Life Cycle (TLC) A firm needs to understand the TLC to get the most ROI on its technology Stage 1: Technology Development –3 reasons for development Obvious application Sufficient financial resources Projected ROI –Other considerations Partnership? Sell the technology? Staff sophisticated enough to market the technology 32

33 Peace and Prosperity Through Science and Collaboration The Technology Life Cycle (TLC) Stage 2: Technology Application –Decision to continue to develop or sell the technology –Cost and risk assessment –Consider the potential returns from the technology as a whole - not just immediate sells Stage 3: Application Launch - Performance Maximizing –Problems with licensing application of technology may not be refined sufficiently delayed due to long lead times ownership problems - not developed here problems associated with buyer and changes required –Delay of launch may be an alternative –Skim the market to recover costs 33

34 Peace and Prosperity Through Science and Collaboration The Technology Life Cycle (TLC) Stage 4: Application Growth - Sales Maximization –Market penetration considerations market size technology leadership Standardization Stage 5: Technology Maturity - Cost Reduction Phase –Now in full competitive stage –Production has leveled off for the originator –Transfer to third world countries - turnkey deals Stage 6: Degraded Technology –Reached a point of saturation and virtually universal exploitation –License has expired –Low commercial value 34

35 Peace and Prosperity Through Science and Collaboration Some Final Thoughts on Managing Technology Innovation and Commercialization Strategy Market-Goal Orientation – Keep it real! –Innovative companies consciously anchor their visions to the practical realities of the marketplace Know that you are Managing Chaos! –Innovation is a process that is rarely planned and controlled –Not analytical - intuitive, tumultuous process –Innovation is probabilistic Possible Solution? –Form small, flexible teams to enhance motivation, interactivity, and accelerate progress –Use determined champions 35

36 Peace and Prosperity Through Science and Collaboration SUMMARY POINTS DO YOU HAVE WHAT IT TAKES?? WHAT DO YOU HAVE TO OFFER THAT IS OF VALUE?? HAVE YOU DONE YOUR RESEARCH?? DO YOU HAVE A COMPLETE BUSINESS PLAN?? HAVE YOU GARNERED TEAM AND FINANCIAL SUPPORT?? ARE YOU A LUCKY PERSON?? 36

37 Peace and Prosperity Through Science and Collaboration Q U E S T I O N S Michael Stankosky, DSc George Washington University (202)


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