People, groups, and organizations can share technology, knowledge, skills, and ways of making things with each other through a process called technology transfer. It is very important for new ideas, economic growth, industrial development, and getting scientific discoveries around the world. In addition to increasing productivity, this process also aids in bridging the technological divide between various sectors or nations. There are different ways to transfer technology, and each one is used for different things depending on the source, the recipient, and the type of technology involved. We'll talk more about the main types of technology transfer below.
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1. Horizontal Technology Transfer
When companies at the same level in the production process or industry chain share technology with each other, this is called horizontal technology transfer. This kind of agreement is common between businesses or research centers in the same sector that are in different parts of the world.
Example:
A pharmaceutical company in India might let another pharmaceutical company in Brazil use a technology for making drugs.
Characteristics:
Most of the time, it involves joint ventures, licensing agreements, or strategic partnerships.
Helps countries compete and get goods from other countries.
It is common for multinational companies and universities to share the results of their research with other researchers.
2. Vertical Technology Transfer
When technology is moved from one part of a company's production process to another, or from one part of a supply chain to another, this is called vertical technology transfer.
Example:
A company develops a new production process in its R&D department and transfers it to its manufacturing unit for implementation.
Characteristics:
Common in internal organizational processes.
Helps streamline production and improve quality.
Encourages innovation dissemination from R&D to operations.
3. Internal Technology Transfer
When people move within the same company, usually from the R&D department to other areas like marketing, production, or customer service, this kind of transfer takes place.
Example:
A software development company creating a new algorithm in its R&D department and implementing it across product teams.
Characteristics:
Controlled and confidential.
Streamlined implementation and quality control.
Helps maintain competitive advantage within the company.
4. External Technology Transfer
When one organization gives technology to a completely different one, this is called external technology transfer. It happens a lot between businesses and universities or between research institutions and private companies.
Example:
A university develops a new biodegradable material and licenses it to a packaging company for commercial production.
Characteristics:
Requires legal frameworks like patents and licensing agreements.
Facilitates commercialization of research.
Often supported by government and innovation policy initiatives.
5. Formal Technology Transfer
Legal agreements, contracts, licenses, and partnerships are all ways that technology is transferred in a formal way. It is closely controlled and well-documented, and it usually involves talks about intellectual property (IP) rights and royalties.
Example:
A patent license agreement between a tech startup and a manufacturing corporation to use proprietary software.
Characteristics:
Involves legal frameworks.
Ensures IP protection and commercialization.
Essential in high-tech industries like biotechnology, aerospace and software.
6. Informal Technology Transfer
Casual or non-contractual means, like training sessions, publications, conferences, or job mobility, can lead to an informal transfer. Even though it is less regulated, it can be a very good way to share unspoken knowledge.
Example:
A researcher attending a global conference shares experimental findings that inspire further innovation by another researcher.
Characteristics:
Difficult to track and quantify.
Encourages open collaboration and academic growth.
Crucial in knowledge-based industries.
7. Voluntary Technology Transfer
For technology to be transferred, the person who owns it must agree to it. Most of the time, people do this because they want to help each other, make money or share an interest.
Example:
An electronics company voluntarily licenses its battery technology to a green energy startup.
Characteristics:
Usually involves partnerships or licensing.
Encourages innovation and market expansion.
Reduces duplication of R&D efforts.
8. Involuntary or Compulsory Technology Transfer
As part of trade agreements or investment requirements, governments sometimes require foreign companies to transfer technology to local businesses. Even though it's controversial it's done to improve local skills.
Example:
A foreign automaker is required to partner with a domestic manufacturer and share technology to operate in a specific country.
Characteristics:
Often driven by government policy.
Common in developing economies seeking self-reliance.
Can cause disputes over IP rights.
9. Commercial Technology Transfer
This type is all about making technology available to the public. Universities and research labs usually work on this to turn theoretical discoveries into products or services that can be sold.
Example:
A research institute develops a medical device prototype and licenses it to a health-tech startup for production.
Characteristics:
Encourages innovation ecosystems.
Connects academia with industry.
Involves tech incubators and transfer offices.
10. Cross-National Technology Transfer
This entails the transfer of technology across international boundaries, typically from developed to developing nations. It is a big part of industrialization and growth around the world.
Example:
A European wind turbine manufacturer sets up operations and transfers production technology to an African country.
Characteristics:
Influenced by foreign direct investment (FDI) and international aid.
Promotes global equity and sustainability.
Involves cultural and regulatory challenges.
Summary
Different kinds of technology transfer are important for new ideas, economic growth, and globalization. Each type of transfer helps spread information and technology in its own way, whether it's within an organization, between businesses, or between countries. Stakeholders can choose the best ways to work together, make money, and build capacity when they know about the different types. As the world becomes more linked, it will remain important to transfer technology in a way that solves problems and promotes growth for everyone.
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Types of Technology Transfer: FAQs
Q1: What is the difference between formal and informal technology transfer?
Formal transfer is done through legal agreements and contracts, while informal transfer happens through informal interactions like workshops or publications.
Q2: Can technology transfer happen between countries?
Yes, cross-national technology transfer occurs when technology moves from one country to another, often to support development.
Q3: What is involuntary or compulsory technology transfer?
It is mandated by governments, requiring foreign firms to share their technology with local companies to operate in the country.
Q4: Why is commercial technology transfer important?
It helps convert research innovations into marketable products, boosting industry growth and public access to new technologies.
Q5: What are common channels for technology transfer?
Common channels include licensing, joint ventures, research collaborations, technical training, and consultancy.
