Marcel Dissel

Value Roadmapping: A Structured Approach for Early Stage Technology Investment Decisions

Deciding to invest in early stage technologies is one of the most important tasks of technology management and arguably also the most uncertain. It assumes a particular significance in the rise of technology companies in emerging economies, which have to make appropriate investment decisions. Technology managers already have a wide range of methods and tools at their disposal, but these are mostly focused on quantitative measures such as discounted cash flow and real options techniques. However, in the early stages of technology development there seems to be a lot of dissatisfaction with these techniques as there appears to be a lack of accuracy with respect to the underlying assumptions that these models require. In order to complement these models this paper will discuss an alternative approach that we call value road-mapping. By adapting roadmapping techniques the potential value streams of early stages technologies can be plotted and hence a clearer consensus based picture of the future potential of new technologies emerges. Roadmapping is a workshop-based process bringing together multifunctional perspectives, and supporting communication in particular between technical and commercial groups. The study is work in progress and is based on a growing number of cases

Evaluating early stage technology valuation methods; what is available and what really matters

This paper reviews methods to value technology in an industrial context. Decisions on early stage technologies are ill- supported and need to be seen as part of an iterative process including more qualitative techniques. overview of some widely applied methods and tools will be provided. Based on this overview we will then evaluate these methods and techniques on their practical merits. Initial results are taken from three ongoing case studies in technology-based companies, in terms of the limitations and constraints with respect to these existing methods and techniques. The paper will conclude by providing recommendations for future research in development of methods and techniques for early stage technology valuation.

Multiple Perspectives On Appraisal Techniques For New Technologies: Examples From The Aerospace Industry

Appraising the benefits of new technologies is a commonly accepted challenge for any organization and is a prime area for technology management research. A wide variety of methods are available that intend to service this need, such as discounted cash-flow, real options, portfolio methods, roadmapping, etc. However, little evidence exists on who applies these techniques and how they are used in practice. This paper will evaluate the techniques from literature and compare the results with cases from the Aerospace industry. The paper will show that there are two distinct perspectives that can be taken when looking at the valuation process and these perspectives change in the course of the technologys life cycle.

An interdisciplinary perspective on business appraisals for technology potentials

Appraising the benefits of new technologies is a commonly accepted challenge for any organisation and is a prime area for technology management research. As the future potential of any technology is always associated with some level of uncertainty it is thus important to either reduce or better understand this uncertainty in order to make appropriate business decisions. A wide variety of methods are available that intend to service this need, such as net present value calculations, real options, portfolio methods, road-mapping, expert systems, etc. Technology companies often use a selection of or hybrid models. The problem is thus inherently interdisciplinary. The techniques used to appraise new technologies range from “hard” mathematics, often taken from the finance sector, to more “softer” techniques that enable people to systematically structure the potential outcomes and their underlying uncertainty. Furthermore, the use or purpose of the techniques can vary as well. Methods can be applied to justify decisions and judgements made, but also to support the process of shaping this judgement, or to provide boundary conditions and hence enable the decision making process. This paper aims to provide an overview of prevailing methods and tools and evaluate their relative value in the process of business appraisals. We will elaborate on the overlaps and gaps and conclude with recommendations for future research.

Selling new technologies; making a convincing business case

Convincing someone to invest in new technologies is one of the most important tasks of technology management and arguably also the most uncertain. Despite the fact that technology managers having a wide range of methods and tools at their disposal to value technologies, the actual process of getting the buy-in and subsequent funds of the board, business units, or external customer is often an unsatisfactory process. In fact very little has been written on the sales process for new technologies. This paper argues that to complement this gap technology managers can learn from existing sales practices and processes by applying consultative sales concepts. The paper reports on an ongoing study and reviews literature on current technology development processes. There appears to be a disconnection in the communication between seller and buyer and the process of establishing what we refer to as a technology-problem combination. This notion is supported using two illustrative cases in the automotive and aerospace industry. The paper concludes by proposing a process to integrate a consultative sales approach for new technologies.

From gut feel to educated approximations: Towards an integrated approach for technology valuation

To understand the potential value of a technology a wide range of techniques is available. Examples are quantitative techniques such as discounted cash-flow, real options and decision trees and qualitative techniques such as roadmaps and scoring cards. However, very little has been written about their integrated use and more particularly over the life cycle of a technology. Whereas many companies have their own processes in place often combining qualitative and quantitative techniques, very few empirical studies have been performed to learn from these industry practices and provide an overall view on the process of valuing technologies. In this paper we propose an integrated approach, combining both qualitative and quantitative techniques. Based on ongoing case study research we will elaborate on the use of both qualitative and quantitative methods, and will provide a conceptual basis for integrating these techniques. By seamlessly integrating the qualitative foundations with quantitative projections, judgements can be turned into justification models (using for example decision trees and real options thinking), and scoring mechanisms can turn the collected gut feel into educated approximations for probabilities and financial projections. Although we do not assume a generic decision making process can be defined, the integrated logic provides a more consistent guide for R&D managers and adds to the body of literature, more particularly empirical studies, on the selection and use of a diverse set of valuation tools.

Sustaining product innovation in the new economy: the case of Siemens Switzerland

Today innovation is considered the main driver for growth in the new economy and it therefore follows that to sustain any competitive advantage, continuous innovation is a pre-requisite in most industries. However, innovation is by no means straightforward and for large firms, this situation is further exacerbated when small, entrepreneurial firms react to changing market conditions quicker than the often slower incumbent. This paper examines and analyses the steps taken by Siemens Switzerland to meet the threat posed by such firms and the influx of disruptive technologies. In particular, attention is paid to the firms development of a new dynamic innovation capability. The paper concludes with a model of activities that the firm have assimilated into proven processes for dynamic front-end innovation.