1. BPT 3113 – Management of Technology
Technology Transfer
BPT 3113 – Management of Technology

2. Chapter Outline Definition Classification & Categories Significance
Elements of Transfer Process
Package
Modes of Transfer
Channels of Technology Flow
Effective Technology Transfer
Pricing of Technology Transfer
Summary

3. Lesson Outcomes
Explain the concept & significance of technology transfer
Identify the different types of technology transfer
Describe the modes of transfer

4. Definition
A process by which science and technology are transferred from one individual or group to another that incorporates this into new knowledge
Technology transfer is defined as the acquisition and use of technology
There is no transfer of technology unless and until the technical knowledge is put to use
Technology transfer occurs because of existence of ‘buyers’ and ‘sellers’ of technology

5. Definition
It is the process of providing the technology developed for one organization for other potentially useful purposes
Technology Transfer is a process that permits the flow of technology from a source to a receiver.
Source : the owner or holder of the knowledge that could be an individual, a company or a country
Receiver : The beneficiary of such knowledge

6. Classification Horizontal
Implies transfer of technology from one firm to another
Such transfers take place generally between the firms located in different countries – due to competition and maturity of technologies
Vertical
Means transfer of technology from an R&D organization to a firm
Such transfers are mostly within the country and the technologies are new and may often require further efforts in terms of establishing commercial viability

7. Categories International Technology Transfer
Transfer is across national boundaries
Eg. : industrialized countries to developing countries
Regional Technology Transfer
Transferred from one region of the country to another
Eg.: Florida to Alaska
Cross-Industry / Cross-Sector Technology Transfer
Transferred from one industrial sector to another
Eg.: space program to commercial applications

8. Inter-firm Technology Transfer
Transferred from one firm to another
Eg.: transfer of CAD expertise and CAM machines from a machine tool manufacturing firm to a furniture producing firm
Intra-firm Technology Transfer
Transferred within a firm from one location to another
Can also be made from one department to another within the same facility
Eg.: one department uses sophisticated computer technology and another relies on manual work

9. Significance Buyer / Recipient Seller
As a solution to someone else’s problem
Avoiding ‘reinventing the wheel’
Helps the firm catch up with latest technological and market trends
Provides return on investment mode on technology development
Builds the image of technopreneur
Encourages the innovators to find new areas of application of the technology

10. Elements of Transfer Process
Seller capabilities and motivations
Buyer
Technology gap
Technology package
Bridging agencies
Operational environment
Mechanisms of transfer
Mode of transfer
Price

11. Package
Technology package consists of 4 principal elements – product design, production technique, service facilities and management systems
Categories of technical information or know-how inherent in technological systems are:
General knowledge – blueprint reading
System specific knowledge – special solutions / procedures acquire from the experience
Firm specific knowledge – results from the firm’s overall activities

12. Modes of Transfer The Passive Mode
Also called dissemination mode; published literature is used as form of technology transfer
No direct communication or assistance from the originator of the technology to the producer or finished consumer item
Technical information
Technology base
User
Primary innovator for application of technology
Publications
Computerized data base
Personal contacts

13. Modes of Transfer The Semi-Active Mode
The technology transfer agent screens available pertinent information for product development
The role technology transfer agent is somewhat limited – as an interpreter or communicator not actively participate in the application of the technology
Technology
base
Technical
information
Technology transfer agent
User
Secondary innovator for application of technology
Primary innovator for application of technology
Publications
Computerized data base
Personal contacts

14. Modes of Transfer The Active Mode
Carries the process through to an actual demonstration
The technology transfer agent or consultant will be fully involved and acts as a bridge in technology transfer from technology source to entrepreneur or implementing agency
Technology
base
Technical
information
Champion and his team
User
Publications
Computerized data base
Personal contacts
Primary innovator for application of technology
Secondary innovator for application of technology

15. Channels of Technology Flow
General Channels
Done unintentionally and may proceed without the continued involvement of the source
Information is made available in the public domain with limited / no restrictions on its use
Information is harnessed by users and applied to their purposes
Channels of this type of transfer include education, training, publications, conferences, study missions and exchange of visits.

16. Channels of Technology Flow
Reverse-Engineering Channels
No active contribution from a source
A host / receiver is capable of breaking the code of a technology and developing the capability to duplicate it in some fashion - no legal violation of property rights
Example : a product that is put on the market by company A can be purchased by company B, reverse- engineered and introduced to the market as a competitor to company A’s product
Such knowledge is usually gained during the product development process

17. Channels of Technology Flow
Planned Channels
Is done intentionally, according to a planned process and with the consent of the technology owner
There are several types of agreements that are used to effect planned transfers; they permit access to and use of technological know-how
Suppliers
Licensing
Franchise
Joint Venture
Turnkey Project
Foreign Direct Investment (FDI)
Technical Consortium and Joint R&D Project

18. Effective Technology Transfer
To be successful requires the existence of infrastructure including facilities, equipment and personnel and a transfer team
Guidelines for setting up a transfer team:
Small team members
Trust and healthy competition
Building teamwork
Command and communication channels should be well understood
Quality of the people selected to perform the tasks

19. Pricing of Technology Lump Sum Payment Fees Royalties
Appropriate where it is desired to obtain the technology by outright purchase
Calculated in advance
Agreed sum may be paid in installments
Fees
The reward for technical and managerial expertise provided by the supplier
Technical fee – training, set-up R&D
Management fee – any fees payable for the management of the plant
Royalties
Can be considered a lease payment, not an outright payment
May be paid as a percentage of sales value

20. Summary
Transfer of technology is a process essential for the wide application and utilization of technology by one or more users
There are nine key factors in technology transfer process
Payments for the technology may be divided into 3 broad categories, although in practice an agreement may involve