In following 30 minutes you will be introduced to two Technology Capability Audit Tools, which are effective tools to assess the technology capability in your firm.
Two audit tools:
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The common feature of both audit tools is that the audit assessment is based on the characterization of nine categories of technological capability.
Be patient and you will receive detailed explanation about each characteristic and applications of both Technological Capability Audit Tools!
Figure 1: Nine categories for technological capability assessment
The answer to each of the questionnaire's question has a fixed score - from 1 to 4. Firms can use the total score in each dimension to give an indication of where the firm has strengths and weaknesses in its technological capability and where further development is needed. |
Step 1: Calculation of your firm's overall capability level1
Simple questionnaire tool consists of 24 questions, which have to be answered. The advantage is speed, as the questions can be answered quickly. The main disadvantage is that it does not explore technological capability dimensions deeply and can only provide an overview assessment.
Now it's time to start to evaluate your firm's technological capability and ascertain strength and weaknesses in your firm! Answer the questions and calculate the total score. Find out to which category of technological capability your firm qualifies. |
Table 1 is the simple questionnaire tool, which will allow you to determine your technological capability by answering the following 24 questions by assessing each question from 1 to 4 points. Let us assume that firm "Styx" has filled the questionnaire.
Table 1: Simple questionnaire2
Please stop and think: | |
The technology capability level of a firm is represented by four categories: from 1 to 4 or from Type A to Type D. Capability level 1 or A is the score for the weakest firm and the score 4 or D stands for high-tech firm. You will learn about the types of firms a bit later! |
Table 2 gives a short explanation of each technological capability levels and the score achieved in the questionnaire above will help you asses your firm's capability level.
Table 2: Four categories of technological capability3
Now we can find out where firm stands on the "staircase" of technological capability level. Now let us have a look at the following Flash presentation, where a description of each type of firm is given.
Professor John Bessant developed this model.4 However, as with many things in life a firm's category can change over time! That means the firm can be placed in Category "A" for some time, when they don't have their own free financial resources or outside strategic investment partner. After investment in technology advancements a firm can reach the category "D" in quite a short time. The crucial factor is a manager's or owner's knowledge and understanding of the importance of having high-tech technologies and equipment. Nowadays most firms belong to the type "C" level. However, within this level there is a considerable difference among firms, ranging from the 'barely strategic' to 'extremely capable' in all strategic matters. Our example the firm "Styx" is also situated within Type C level.
For example, Nokia, the Finnish company, moved from pulp and paper into electronics and eventually became a world leader in mobile telecommunications, showing that it was possible to make very high margins in the production of handsets within the developed countries, when most competitors believed it was impossible to achieve this goal (e.g. Ericsson and Motorola viewed handsets as low margin commodity products).
Step 2: Practical Assessment of a firm's particular strengths and weaknesses5
Now it's time to find out the particular strengths and weaknesses of your firm! You have already answered 24 questions (Table 1) by giving a score from 1 to 4 to each question. Now your answers on each question will be analysed in more detail in order to evaluate your firm's strengths and weaknesses. You haven't done this before? - Then let's do it together! | |
Your firm's strengths and weaknesses will be determined by analysing your scores from the questionnaire (Table 1) against each of 9 categories for technological capability assessment (Figure1). | |
Sounds complicated? Not at all - just follow the instructions and read the explanations carefully, and soon you will be aware of the technological capability situation in your firm! |
A practical example6 you can find in this PDF.
Step 3: Draw the table in Excel with your score results for each of nine categories of the technological capability assessment and compare with the best practice model.
The scores of the best practice model are 1 in each category. | |
Let's draw the picture for the firm "Styx" and see, which are the weakest and strongest points in the technological capability. |
Firm's profile of capabilities7
In Figure 3 we can see, that the weakest points are "Awareness", which means the lack of ability of senior management to recognize the role of technology in competitiveness and "Search", which means the lack of ability to monitor external technology events and trends. These are the crucial points for further growth of the firm and significant questions for the management of the firm "Styx". Meanwhile, the strongest points are "Technology strategy", "Assessing and selecting technology" and "Technology acquisition", but for the continuous development of the firm "Styx", the management shouldn't ignore theses 3 categories!
Stop and think: | |
For each category of the technological capability, look at how well you compare with best practice (i.e. the total possible score). You may wish to identify the lowest three scores (technology weakness areas) and the top three scores (technology strengths). This information can direct you in the development of an improvement plan. |
2.3.3.2 Interview tool
The interview tool9 is more a complex and detailed method to assess technological capability in the firm, based on nine sections of questions. The targeted audience for interviews are senior and strategic / technical management and minimum you should allow at least one hour for conducting interviews. Sections of questions are based on the same nine categories of technological capability assessment, with which you are now familiar: Awareness, Searching, Building a core technological competence, Technology strategy, Assessing and selecting technology, Technology acquisition, Implementation and absorbing technology, Learning and Exploiting external linkages and incentives. This tool provides opportunity to explore issues in greater depth and to follow-up on particular themes. |
If you are interested to learn about the Interview tool and applying it in your firm, we suggest you to study the amendment 2.3.A and go to the following web site:
http://info.worldbank.org/etools/docs/library/86442/ses1.2_innovationcaptool.pdf
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