Technology Sourcing

1
Technology Sourcing
2
The Rising Interest in External Sources of
Technology

• Demand side
• Shorter product and service life cycles
• Short of technical expertise due to downsizing
• Risk-sharing manner
• Industry peers on technology sourcing successes
• Supply side
• Scientific and engineering knowledge is growing
  rapidly
• Formation of numerous start-up companies
• Increasing pool of displaced professionals

3
Forms of Technology Sourcing

• Outright acquisition
• Exclusive license
• Joint venture
• Minority equity
• Option for future license
• Joint development
• RD contract
• Exploratory research funding

4
Forms of Technology Sourcing
5
Forms of Technology Sourcing
6
Forms of Technology Sourcing
7
Problems Encountered (I)

• Unclear strategic objectives and priorities.
• Fluctuating commitment and resources.
• Unclear organizational structure and
  responsibilities.
• Limited overseas presence or contacts.
• Finding promising targets.
• Properly evaluating technical and commercial
  merits of identified targets.

8
Problems Encountered (II)

• Coordinating needed cross-functional team
  efforts.
• Negotiating mutually satisfactory agreements.
• Generating or maintaining sufficient business
  management interest in opportunities identified
  by RD.
• Overcoming the "not-invented-here" (NIH) attitude
  of staff or the risk-averse culture of management.

9
Model of the Sourcing Process
10
Market/Technology Analysis
11
RDs Role in Sourcing Efforts