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Sessions VII & VIII

Impact of Global Technical Changes

Technology is the engine that drives the
economies of nations. Technological
capabilities constitute the cutting edge of
business strategies of enterprises that
excel in the intensely competitive global
marketplace. Firms which have mastered
the management of technology are
rewriting the rules of global industrial
Technology absorption, incremental innovation,
research and development, technovision and
technology fusion dominate contemporary world
industry. They are simultaneously the cause and
consequences of the increasingly turbulent and
volatile environment of trade and technology
across the world. An industrial firm under these
conditions cannot afford to stand technologically
still. To do so would imply stagnation and failure.
Continuous development of technology and
technovation underlie the competitive success of
excellent companies the world over.
Global Technical Change
Major changes are :
 Shorter product life cycle
 Higher rate of new product development
 Company wide TQM
 Zero defect product – six sigma
 Training of employees – multiskilling
 Increasing use of automated decision aids like
Decision Support System (DSS) and Expert
Systems (ES)
Impact of these changes
 Global competition
 Automation
 Knowledge intensive nature of production
and service related activities
 Fast-responsive organization based on IT,
particularly in production and marketing
 Transnational strategic alliance between
firms / organization networks and inter-
organization structures
Changes, Uncertainties and
complexities of Globalistion
 Overcapacity of production facilities
 Changing customer value
 Emphasis on product cost, quality & performance
 Lower margin
 Reduction in labour content in the products
 Flexible automation – small lot sizes, model / design
 Fluctuating exchange values
 Faster product renewal, higher quality customized
product, rich market
Components of Technology

 Technoware –
manual tools,
powered equipment,
general purpose machines,
automatic machines,
computerized machines and integrated facilities

 Humanware –
operational abilities / skills,
setting abilities / skills,
repairing abilities / skills,
producing abilities / skills,
adapting , improving and innovating abilities / skills
 Infoware –
familiarizing facts,
describing facts,
utilizing facts,
comprehending facts,
generalizing facts,
assessing facts

 Orgaware –
individual linkages,
collective linkages,
departmental linkages,
enterprise linkages,
industrial linkages,
national and global linkages
Benefits of Changed

High quality products
 Product development at low cost
 Reduced production cost
 Waste reductithon
 High flexibility to changing market conditions
 Economics of scale
 Reduction in cycle time - production and distribution
 Increase in manufacturing capacity
 Flexibility in design & manufacturing operation
 Improved management control
 Data based decision making
 Higher productivity of individuals
 Reduction of inventory
 Higher safety standards / better environment
management– ISO 14000, OSHA (Occupational Health
& Safety Administration)
Technological Foci of Product –
Market Positions
Existing New

(1) (3)
Existin Improve value Adapt know-how

and cost to new markets

(2) (4)
Achieve major Radically

gains in value diversify
and cost: product(s) and
introduce new market(s)