MANAGING INNOVATION IN MULTITECHNOLOGY CORPORATIONS

This paper introduces the concept of a multi-technology corporation (MTC) and elaborates upon some critical problems in managing innovation in such a context. A model that may aid in conceptualizing various technology strategies is presented. Two generic management of technology problems, technology transition and technology transfer, are presented and analysed. Two empirical case illustrations are given. One case analyzes how the Swedish telecommunications company Ericsson managed its successful technological transition from old, electro-mechanical switching technology to new telephone exchanges based on SPC (stored program control) and digital signal processing. The other case analyzes how the Swedish auto-and aerospace company Saab-Scania has attempted to manage technology transfer internally. From each case a number of managerial lessons could be learnt regarding each of the two generic problems in managing technology in multi-technology corporations. In addition, some implications for the theory of firm and industrial organization could be drawn, based on the assumption that managerial development (or learning) takes place regarding technological development. Thereby the conventional view on innovation by invasion and creative destruction is challenged and the old Schumpeter view is qualified. Finally, in the appendix, the empirical relevance of MTCs are discussed. Based on data from the 24 biggest R&D spenders in Sweden, the association between growth, product diversification and technological diversification has been analyzed. © 1990.