Unit 5 Technological Environment Concept and nature: Technology means the skills, knowledge and procedure of making things

systematically and scientifically. Technology is defined as application of science to produce goods and services. Science is theoretical and technology is practical. Technological environment includes all the technology factors that can help a business to increase its productivity, profitability and performance. Technology is mainly used in production and it is also applied in marketing, finance management, labour etc. Elements of Technological Environment: The main elements or features of technological environment are as follows: 1. Changing Nature: Technological forces change and go on changing on people whether they like it or not or whether they are prepared for it or not. In the modern society, technology has brought so much change that it creates what is called future shock, which means that change comes fast and furiously. 2. Widespread Effects: Another important element of technology is that its effects are widespread, far-reaching i.e. reaching far beyond the imm9idiate point of technological impact. Technology ripples through society until it affects every community. 3. Self-reinforcing: As remarked by Alvin Toffler, Technology feeds on itself. Technology makes more technology possible. This self-reinforcing principle implies that technology acts as a multiplier. It acts with other parts of the society in such a way that an invention in one place leads to a sequence of inventions in other places. Linkage between Technological Environment and Business: Performance of a business in the areas of production, management, organization, marketing and finance all are dependent on use of technology. Benefits of technology are multiple. It reduces cost and increases profitability. Workers will get better working conditions and wages. Customers get the better quality products at reasonable price and it also ensures economic use of natural resources. The effects of technology are universal and global, although its benefits may reach at different stages and at different times. Every firm has to function under prevailing technological environment. Firms that do not adapt themselves to existing environment will become outdated and their product obsolete. Technology and Society: Technology touches every person in the society. Socio, economic, political conditions in the society are dependent on level of technological advancement. Impacts of technology on society are following: (1) Social transformation: Technology will bring new social order in the society. Old, traditional, rural oriented, backward society may be replaced by new and modern society. A new social awakening can be experienced in the society with people becoming more modern in their thought and outlook.
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Improved standard of living: Technology helps to better standard of living. Technological progress provides more job opportunities and better income. It also floods market with variety of goods and services. People have capacity and opportunity to buy goods and services of their choice. This will increase their standard of living. Develops human capabilities: Adoption of latest technology requires competitive personnel who pose required skill and knowledge to handle technology. Industry itself may provide training to the staff to update of its workers knowledge. Refresher and orientation courses are conducted to give latest knowledge. Workers are motivated to learn new skills. Capabilities of people are developed to manage the new technology. High expecting of consumers: Growth in technology has increased wealth and prosperity in society. It has resulted in demand for new and variety in product and services. Modern technology is designed to meet the customer expectations by designing and delivering goods of their choice. Role of education: In the present technological era the purpose of education is specific, to create and manage technology. Technology based education receives more importance. College and universities cannot remain factories to produce degree certificates. Degrees which do not have practical or technological content will not be accepted by the industry.

Economic Effects of Technology: Technology plays an important role in increasing economic activities and ensuring economic prosperity. Economic effects of technology are as follows: (1) Increase in Productivity: Technology helps to achieve productivity. Application of technology results in decreases in cost of production by reducing wastages, improving speed and quality. Productivity benefits everyone. Organization is benefited due to increased profits. Workers get better wages and working conditions, customers are benefited by better products at reasonable price. Insatiable demand for capital: Technology demands uninterrupted flow of capital. Capital is needed to install technology; further capital is needed to replace the old technology with new technology. Economy must have well developed capital market that can supply necessary capital for installation of replacement of technology. R&D activities: There are various options for developing technology. There can be technology transfer or outsourcing i.e. it can be borrowed from other firms or other countries. Outsourcing is undertaken when it is not possible to develop ones own technology or technology developing is costly. It can be outsourced or borrowed from outside. Technology can also be developing domestically. Developing own technology requires huge and continuous expenditure in R&D activities. Techno structure: Installation of latest technology makes it inevitable to an organization that technical staff should manage such technology. Experts like scientists, engineers, management experts, marketing wizards and other experts occupy top level of management. Decision making process in the organization i.e. planning, policy formulation, directing etc. will be decided by these technical people. Innovation as key to development: Dynamic entrepreneur exploits new business ideas and products that satisfy needs of customer. Innovation is dependent on R&D activities that are conducted in laboratories. Such innovation has no meaning unless the innovative idea is put into practical use through technology.

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Role of Government: Government plays an important role in the growth of technology. The role government can be identified the two ways. 1) It provides incentives and facilities for technological development (R&D) activities. 2) It introduces regulations and restrictions to ensure use of technology for the welfare of society. Government is passing legislations and creating legal bodies to ensure that technology is developed keeping in the interest of consumers, workers, nature and society. Economy and Government will interfere in the development and application of technology. Government has been passing policies to give clear direction for technology progress.

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E-Governance: Technology helps to undertake e-governance. The spread of internet, revolution in communication technology, Tele-conferencing technique, and advancement in computer technology have contributed of the growth of egovernance. Sitting at Head-office, the CEOs (Chief Executive Officers) can direct and control affairs of their organization, which are spread over in different countries. Rise and decline of products and organizations: Technology will keep on continuously updating itself. New technology replaces the old technology. Due to this new products replace old product. Firms, which develop new technology and introduce new products will survive otherwise they have to make way for new firms.

Technology and plant level changes: The following are the important issues to be considered in respect of plant level implications. 1. Technology and organization structure: Technology has a great influence on organization structure, length of the line of command and span of control of the chief executive. Where the technology is fast changing, the firms use matrix structures. 2. Resistance to change: Any change in the organization is generally resisted or opposed either by the management or by the work-force or by both. This is also applicable to a change in technology i.e. new technology poses new problems which may not be liked by the people of the organization. 3. Fear of risk and uncertainty: There is always the fear of risk and uncertainty in the new venture. Many businessmen do not like to adopt any new technology because of the fear of risk and uncertainty about the success of the new technology. 4. Total Quality Management (TQM): Maintenance of quality of product or services is a must for every organization which has to take such measures that every step in the manufacturing process is subjected to intense and regular scrutiny for ways to improve it. 5. Business Process Re-engineering (BPRE): Business process re-engineering is a process which involves considering how things would be done in case the organization has to start all over from scratch. BPRE is being considered qui9te essential in the modern competitive world. If the organization is to survive such competition, it must cut down its costs, eliminate waste, give up what is irrelevant and unnecessary and improve the quality of its product or service. BPRE helps the organization to achieve its objectives. 6. Flexible Manufacturing System (FMS): Another by-product of technology is the Flexible Manufacturing System (FMS), under which machines are designed to produce batches of different products. It can produce dozens or hundreds of different parts in any order as desired by the management.
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Management of Technology: Management of technology means maintaining a system of technology that has compatibility with various aspects like cost, finance, implication; suitability etc. management of technology involves taking decisions regarding installation of a system that is beneficial to the organization. The decision making process in selection of appropriate technology or management of technology has following element. 1. Financial evaluation of technology: Adoption of technology requires its financial evaluation, i.e., its costs and benefits analysis. Future is uncertain, that is receipts of income in future are risky as it is difficult to predict to future happening. Firm has considered those technology proposals where degree of risk is within the control and income can be estimated. 2. Appropriate technology: Technology to be selected must be appropriate to the business and its environment i.e.: 1) It must match the product specification. 2) Firm must have adequate know how or knowledge of its installation and maintenance. 3) Workers must be adequately trained to handle the technology. 3. Legal formalities: The technology must satisfy the legal norms and restrictions of the government. a) Firm should ensure that it can qualify the environment and pollution standards fixed by the government. b) If the said technology is going to be imported, it should get the import clearance. 4. Suitability to the market: Technology must be suitable to the existing marketing conditions. If the technology is too advanced or sophisticated, it is useless. On the other hand if the technology is old and outdated it will not be competitive. 5. Future looking: The change i8n preferences, tastes, fashion and technology itself must be considered before deciding to install a particular technology. It must not be immediately become outdated. Technology must have durability and sustainability to recover the cost that is incurred on its installation. Technology Policy: Science & Technology Policy 2003 This policy was based on following objectives. 1) 2) 3) 4) 5) 6) To ensure that the message of S&T reaches every citizen of India. To vigorously foster scientific research in universities and other institutions. To provide necessary autonomy in functioning of academic bodies and R&D centers. To encourage close interaction between private and public institution in S&T. To establish and IPR regime, which gives protection and incentives for generation of patents of new inventions. To encourage R &D activities in the areas of social problems faced by the society like hunger, malnutrition, generation of employment, regional imbalance etc. 7) To encourage research in the area of natural calamities like flood, cyclones, draughts, earthquakes their prevention, and precaution. 8) To provide international co-operation in S&T. To achieve these objectives, government formulated following strategies.
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Strengthening the infrastructure and ensuring its optimum utilization. New funding mechanism for basic research. Technology development, transfer and diffusion. Interaction between industry and scientific laboratories. Utilization of indigenous and traditional knowledge. Development of technologies for mitigation and management of natural hazards. Generation and management intellectual property. Creation of awareness among public about S&T. Achieving international S&T co-operation.

Critical evaluation of S&T environment in India: With all their policies and initiatives India is ranked 8th in technology, some of the major problems faced by Indian technology environment are as follows: 1) Expenditure by private sector companies and non government sector is minimum. 2) R&D expenditure by government is annual 1% of GDP compared to 2 to 3% in developed countries. R&D expenditure by government is in strategic areas like defense, space technology etc. 3) Research undertaken by scientific institution is not marketable, it do does not have commercial value. 4) Lack of adequate and suitable infrastructure for research activities. 5) In spite of policy initiatives, there is no co-operation and co-ordination between industry and laboratory. 6) Science and engineering colleges, universities are mere academic bodies; research carried by these organizations is not fruitful to the society. 7) Growth of indigenous technology is affected due to liberalization process which has allowed for import foreign technology.

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