Wednesday, February 04, 2015

Technology Scouting for Fun & Profit

The rapid pace of technological change has technology managers in all industries concerned with how they can keep abreast of developments in related – and unrelated – fields that may create new opportunities or pose threats to their business.  No longer can a manager simply look to the firm’s internal R&D effort or its business partners to provide access to all of the technologies and skills the company needs.  For one thing, over the last 30 years, much scientific research and radical innovation has been pushed upstream into academia and government research centers as corporate R&D centers focus their efforts on supporting current and next generation products.  Furthermore, innovation is increasingly the product of the fusion of two technologies – think bioinformatics, for example – or the application of a known concept to a new field (such as laser printers which were developed from existing copier technology).  No internal effort could possibly hope to master it all – not even in the largest of companies.  So how do these businesses maintain an awareness of emerging technologies and the opportunities (or threats) they may portend?

One approach is to maintain a high enough profile and hope that tech transfer managers, entrepreneurs, and other developers of new technology come to you with their developments.  This may work in some cases, but no business can afford to sit back and hope that important components of its technology portfolio will just walk in the door. Maintaining an awareness of new technological developments has traditionally been the purview of scientists and engineers in the lab whom, it was believed, lived on the front line of S&T development and thus would be familiar with new technologies.  This is a bad assumption.  The short comings of this approach are the same as those noted above that afflict the business more generally – that is, no one can know it all.  Besides, that is not their job.  They have their own projects to look after.  Today, leading technology companies resort to a systematic process of Technology Scouting to proactively search out and acquire new technologies.

Technology scouting doesn’t require a massive effort, but it does call for thoughtful organization.  And, it is not competitive intelligence per se though there is some overlap in research skills. (Competitive intelligence seeks to maintain an early warning system of competitors’ actions while scouting seeks out new technological developments for incorporation into the firm’s technology portfolio.)  Today, technology intensive firms from virtually all industrial sectors including IT, pharmaceuticals, automotive, electronics, chemicals, oil& gas, and more rely on a variety of sources to keep abreast of new developments of interest to the firm.  Even businesses that we seldom think of as technology companies have climbed on board.  For example, low-tech products from toys to food increasingly rely on a variety of technology intensive processes to manufacture them and which impact their competitive position.

So now you’ve decided that your firm needs to scout for new technologies – in self-defense if nothing else.  Where do you start?  The figure below shows the basic elements of a technology scouting program.

First, you must determine precisely what you want this scouting effort to achieve.  And, as we’ve said, this often comes under the general heading of finding opportunities and identifying threats.  In this effort, do not fail to consider the possible societal responses to new technology (Monsanto and Unilever, to name just two, now wish that they had more carefully considered the potential societal resistance in Europe to genetically modified crops). 

Next comes the scouting plan which details the various roles and responsibilities of those in the group.  Who will be responsible for which sets of technologies?  While the focus is clearly on emerging technologies, be careful to ensure a proper alignment between scouting activities and corporate goals and objectives.  To what extent will you manage this effort with in-house resources and will there be a need to go outside the organization for additional expertise? And, as shown, it is often just as important to be aware of what is not happening in the environment as what is happening.

Third, a complete listing of data sources – both secondary and primary – to support the effort must then be developed.  Obviously it is less costly to comb through previously published materials, but figure on obtaining the real nuggets from discussions with other people – internal and external.  There is a skill to doing this.  And don’t fall into the trap of assuming that patent searches will completely reveal the technological landscape.  

Fourth, consider the methods of observation that you expect to employ.  Although the three categories of surveillance are often used interchangeably, I regard scanning as a broad look at the technological landscape to identify areas for more detailed study, monitoring as a continuous look at a specific field or technology to identify new developments of interest, and tracking as a detailed look at advancements in a specific technology or technological approach.  Often, tracking provides the time series data that you will use to conduct a trend analysis (such as Moore’s Law, for example). 

Finally, not to be overlooked are the mechanisms that you will use to convey the results of your scouting activities to senior management and other decision makers.  There are roles for both reports and alerts that the group may issue as well as monitoring databases that may be accessed by employees when they need information on a topic.  But then, the really hard work begins – due diligence on the target technologies of interest and assessing the strategic and operational fit will be critical to moving forward and must not be taken lightly.  But, if done well, the benefits can be enormous.

Ready to get started?  Emerging technologies are everywhere and only a systematic effort will help ensure that you keep abreast of those of most interest to you.  If you need help, contact me at