Lecture 3: ACQUISITION
Lecture notes
Acquisition relates to how the company will obtain the technologies needed for it
business. There are two types of technology sourcing approaches internal (R&D) and
external.
There are two types of acquisition:
INTERNAL ACQUISITION (R&D)
It is a process of creating a firm’s technologies in-house or thorough collaborations.
There are two main goals of R&D:
A- To generate new knowledge and technical ideas aimed at new and enhanced product,
manufacturing processes and services.
B- Development activities where ideas are transformed into working models and
embodied in new products and services including (manufacturing and distribution and
use)
In open innovation systems, firms organize both in-house and collaboration with
external partners for their internal and external activities. Open innovation systems the
role of R&D departments.
Absorptive Capacity – Measure a firm ability to value, assimilate and apply new
knowledge on multiple levels-individual, group, firm and national level.
R&D projects devoted to ensuring that production and other operational systems
continue to function and improve. These sustaining or technical service projects are
required to solve unexpected problems or enable equipment maintenance. R&D projects
are identified and possible projects selected.
Three main processes within the R&D context:
• R&D portfolio management
• New product/service development
• New process development
R&D portfolio management:
The main challenge of R&D portfolio management:
• the uncertainty and the complexity of a multi project decision model
• changing information about technology
• the existence of dynamic opportunities
• high interdependence among projects
• multiple decision makers from different management units
Strategic decisions about R&D projects are tied in with management to intellectual
property right (IPR). Intellectual Property (IP) is an umbrella term for various legal
entitlements that attach to certain names, written, and recorded media and inventions.
New Product Development
New Product development is to describe the complete process of bringing a new
product or service to market.
Some products are completely new products, since they are new not only to the
company but also to the market but not to the company. The new product development
process aim to capture the exploitable knowledge .It generated by R&D activities and
divided into six phases/stages.
1- Idea generation – Capture and rank the idea against strategic priorities
2- Preliminary investigation- Evaluate readily available data or recheck for arrangement
with strategic objectives and relative priority against other projects.
3- Detailed investigation – Select the product concept based on customers’ needs,
competitive solution, product cost, product quality and technical risk.
4- Development – Develop the product and manufacturing or services process (detailed
design)
5. Tested / validation – Verify the manufacturing or service process and introduce the
product
6- Production/development – Upgrade up production volumes and improve
manufacturing process to achieve cost and quality goals.
The phases of new product development are represented as development funnel (idea/
project funnel). It illustrates the new products development process where the idea
generation development and product launch/ commercialization activities are
conducted.
There are two parallel paths:
. 1- Idea generation, product design and detailed engineering
. 2- Market research and market analysis
Market research aims to supply information to what, where, when, how and why
questions about a company’s business.
New Process Development
Certain product strategies may necessitate a corresponding process technology.
Products and processes evolve together depending on the life cycle stages as well as the
