2.3.1 What are technology, technological capability and technological capability audit tool?

What do we mean when we speak about technology? The many descriptions include:

Technology is:

  • a mean for accomplishing a task;
  • conversion of resources into products and services;
  • knowledge and resources needed to achieve a goal;
  • scientific and engineering knowledge that can be applied to the design of new products.

Technology is the knowledge embedded in products and processes, and the knowledge of creating, producing, reproducing, and using these products and processes.1

Innovators need to understand the level of technological knowledge and expertise available both within and outside the firm and in parallel the range of technologies within the firm and the level of expertise available to them.

Accessible technologies are the main resource for the firm's economic growth and welfare. Is it also important for the managers or owners of the firm to know where to find the new technologies - know-how

Technological capability is the capacity to gain an overview of the technological components on the market, assess their value, select which specific technology is needed, use it, adapt and improve it and finally develop technologies. This is a skill possessed both by direct producers (farmers, workers) and also decision-makers (in companies, in state agencies).2

Technological capability involves more than the technologies required for developing a product that meets certain specific requirements. The term Technological capability refers to those activities, which enable firms to choose and use technology to create competitive advantage.3

These are nine main activities, involved in assessing a firm's particular strengths and weakness or Technological capability:

  1. Awareness of the need to improve technologies;
  2. Search ability in relation to external threats and opportunities;
  3. The building of distinctive core capabilities;
  4. The development of a technology strategy to support the business;
  5. The ability to assess and select the appropriate technological solutions;
  6. The acquisition and absorption of the technologies;
  7. The implementation and effective use of the technologies;
  8. The ability to learn from experience in order to improve technology;
  9. The ability to form and exploit linkages with a network of suppliers, researchers and collaborating firms.

Technological capability audit tool is the measurement tool, developed by Professor John Bessant4, for an assessment of individual firm according to nine key technology activity areas described above.

The tool provides a mechanism for:

  • quick auditing of technological capability in firm;
  • identification of the strengths and weaknesses in the firm;
  • benchmarking with other firms or with a "good practice" model.

1 http://en.wikipedia.org/wiki/Technology  
World Bank, 2001, Innovation Capacity Tool: Firm level innovation in the Korean economy, p10