Technology Forecasting - Essay Example

March 14, 2009 Technology Forecasting Introduction Technology has always been the main driver of business, and business concerns thathave been able to foresee technology changes before the competition have always had the advantages both in terms of early market entry and in being the pioneer in the particular field, service or product. Technology advantage along with proper strategic approaches for sustainability translates into huge commercial benefits and, more often than not, the unassailable position of being the market leader. Being able to forecast impending technology changes in the horizon and even beyond, has therefore always been a priority in business management. Technological forecasting has been defined as “the prediction of the invention, characteristics, dimensions, or performance of a machine serving some useful purpose” (Lenz, cited by Lemos & Porto, 1998, p: 330). In other words Technology Forecasting Techniques (TFTs) have been used to determine the future evolution of the technological aspects of materials, products, processes, equipment or services Martínez (1993, p: 513). Initially applied to “the prediction of the invention, characteristics, dimensions, or performance of a machine serving some useful purpose…” (Lenz, cited by Slocum & Lundberg, 2001, p: 2), Technology Forecasting itself has evolved to adapt itself to fast changing circumstances. Adapting to the Changing Role of Technology Conventionally technology forecasting has been based on the application of mathematical tools of modest sophistication to the analysis of trends that have been discernible from the past to deduce future development of the particular technology. However, as technology changed at a very fast rate, the kind of stability that was inherent in technology development till the end of World War II began to give way to an onslaught of technologies since the late sixties (Coates, 1999, p: 62). The coming of Information and Communication Technology (ICT) added an entirely new dimension to the effect and impact of technology on business and heir management. The unprecedented development of ICT, and the accompanying proliferation of computers, peripherals and communication equipment not only in all aspects of business but also in all walks of life and fields of work and activity resulted in technology playing a critical and determining role in business and business strategy. “Now we are at the early stages of another revolution – a revolution in business… New information technologies make this revolution possible.” (Malone, 2004, p: 4) Such rapid and radical changes also meant that the assumptions that could be made on the stable technology trends of the pre-ICT era were no longer possible as the technology trends themselves became very unstable and transient in nature. The high range of available technology choices and the growing complexity in business led to a complexity of the overall environment to which Technology Forecasting had to adapt itself. Thus we see the emergence of Technology Forecasting Technologies such as the Delphi replacing hardcore mathematical and quantitative forecasting. Developed by Ted Gordon and his associates at the Rand Corporation, Delphi addressed the need to collate intellectual information or knowledge from people dispersed over different geographical locations, in an approach very similar to what could be termed as knowledge management to provide technology inputs for strategic planning in resonance with the future and its inevitable changes. Delphi too has evolved over time resulting in a decrease in the number of query rounds and increase in the number of people queried. The development of normative forecasting has also been a response to changing times. Normative forecasting first sets the objectives and then, in a very quantitative manner, specifies the order of activities that is required to meet the proposed schedule. The gaps in terms of capabilities or resources along the way are identified. These gaps can be in any area of science, technology, engineering or organization (Coates, 1999, p: 62). Normative forecasting therefore forecasts a technology change and then splits up the path to achieve the required level of technology advancement into achievable incremental steps to be reached by plugging the identified gaps. Normative forecasting was used in the plan to put man on the moon. General frameworks or propositions have also been applied in place of traditional technological forecasting to cover a wider spectrum of technology impacts. The Moore’s Law is often cited as a prime example of a general framework or proposition. The co-founder of Intel Corp, Gordon Moore had made an observation in the initial years of the ICT revolution that in every 18 months the capacity of computer chip would double while its size would decrease by half. Moore’s law was almost universal in its acceptance and it gave a already galvanized ICT industry the drive and the spurt that was required to usher in a revolution. Conclusion: Into the Realm of Business Strategy Technology changes have been so rapid and so all-encompassing that technology forecasting in its new avatar is becoming more and more an integral part of business strategy development and implementation. “Nowadays, technological forecasting is related to the survival of firms, and even, of whole industries. It is being linked more and more with strategic approaches. Technological forecasting started to play an important role in the strategic planning of firms as well as in their battle in the competitive advantage arena.” (Lemos & Porto, 1998, p: 333) So much so that the distinction between what is known as Competitive Intelligence (CI) and the output information of Technology Forecasting is increasingly getting blurred. Competitive Intelligence can be viewed as value-added business information that provides an edge or advantage to a business over its competitors. Competitive intelligence provides the decision makers in a business organization with systematized data and analysis of publicly available information on competitors and the market for employment in the decision-making process (Lemos & Porto, 1998, p: 333). CI transforms information into intelligence through value addition. Information transforms into intelligence and thence to applicable knowledge. And it is an accepted fact that Technology Forecasting exists because there are people who are better informed than others or more knowledgeable than others; people who can extrapolate that knowledge to foresee events, technological or otherwise, and enable businesses to take advantage of the pre-conceived scenarios. It is because of such reasons that Lemos & Porto (1998) consider Technology Forecasting Techniques to have evolved into Competitive Intelligence with a more holistic approach that covers the entire range of organizational activity, and the results of which can be applied not only to the business organization concerned but also to the domain industry as a whole. “TFTs are today intimately linked with market reality. They not only forecast the evolution of technological dimensions, but forecast trends through the prospected information related to many other strategic variables. That is, the scope of the TFTs has been greatly enlarged and, nowadays, CI is the answer for firms which are striving to innovate and compete in this new and turbulent global market.” (Lemos & Porto, 1998, p: 336). References-01 1. Coates, J., 1999, Boom Time in Forecasting, Technological Forecasting and Change, Elsevier Science Inc. New York 2. Lemos, A., D., Porto, A., C., 1998, Technology forecasting techniques and competitive intelligence: tools for improving the innovative process, Industrial Management and Data Systems, 330-337, MCB University Press. 3. Malone, T., W., 2004, The Future of Work How the New Order of Business Will Shape Your Organization, Your Management Style, and Your Life, Harvard Business School Press. 4. Martínez, E. (Ed.) (1993), Estrategias, planificación y gestión de ciencia y tecnología, Nueva Sociedad, Caracas in Lemos, A., D., Porto, A., C., 1998, “Technology forecasting techniques and competitive intelligence: tools for improving the innovative process”, Industrial Management and Data Systems, 330-337, MCB University Press. 5. Slocum, M., S., Lundberg, C., O., 2001, Technology Forecasting: From Emotional to Empirical, Creativity and Innovation Management, Volume 10, Number 2. Read More