Sources of IT technologies

Author Author:
Innokrea Team
Date of publication: 2021-06-14
Caterogies: Management Strategy

Technologies (including IT technologies) used by production and service companies come from three main sources:

  • internal, when the company carries out research and development’s activities on its own, or in co-operation in a group of companies, as a result of which new technologies are created,
  • external, when the company uses technologies developed by other entities, becoming their owner through the purchase of licenses, ownership rights or the acquisition of the company along with the technology,
  • combined, when the emerging technologies are the result of activities inside and outside the company, with mutual penetration and complementation of both sources.

 The main sources of technology from the company’s point of view are presented in Fig. 1.

Obtaining technologies from internal sources of the enterprise is possible when it conducts research and development (R&D) works, aimed at solving problems in its products, production processes, provision of services, service, etc.

The most important advantages of creating technology with the company’s own resources include:

  • originality of solutions created by own cells with relative freedom, limited only by the goals set by the management and the available potential,
  • mastering the created and used technologies and acquiring know-how that remain entirely in the enterprise and building the potential to take on challenges faced by the enterprise as a result of market and internal changes.

Creating technology with the company’s own resources also has disadvantages. These include, among others:

  • incurring the necessary costs for research and development activities throughout the entire period of operation of research and development units or teams (fixed costs),
  • bearing the risk of failure related to wrong decisions regarding the directions of research and development works and the implementation of their results,
  • often longer time to develop satisfactory solutions and implement them into practice.

Despite the numerous disadvantages and threats, without its own functioning infrastructure creating new technologies, it is difficult for a company to shape its own individuality and originality in order to help it build a strong global market position. In market practice, only the strongest players are able to build new IT technologies.

External sources of technology, adopted in the company’s policy as the basic way of supplying new technical and technological solutions and innovations, mean that it must be focused on constant monitoring of the environment in order to identify the sources of technologies and solutions useful in the enterprise and master the art of obtaining and adapting them for their own purposes. Technology transfer plays a huge role in this activity.

The advantages of external sources of technology are:

  • faster preparation of external solutions for implementation in the enterprise, often without additional unexpected expenditures or after minor adaptations, which in a short time allows you to achieve the intended implementation results,
  • reducing the risk of failure when the experience of technology developers can be used,
  • usually lower costs of obtaining the intended solutions.

The disadvantages of external sources of technology include:

  • relatively superficial knowledge of technology,
  • wide, in some cases, scope of adaptation works that hinder implementation,
  • the need to build relationships with creators and owners of adapted technologies, which may require time and various activities.

The advantages and disadvantages of combined technology sources, as the name suggests, are a combination of advantages and disadvantages of internal and external sources and must be considered individually.

Among combined sources, the most common practice in the IT sphere is the use of technologies made available on the basis of open source licenses and their adaptation to own IT projects. Often, such solutions are relatively the cheapest and ensure the fastest time to prepare the final solution.

At INNOKREA, for several years we have been developing our own product (in the broader sense IT technology), i.e. an auction system for a closed group of users. For its construction, we use combined technologies consisting of stable frameworks developed by global companies and communities (e.g. React, React Native) and ready-made components based on open source licenses and modules developed by our own programmers (e.g. using Python). In a similar way, we implement dedicated IT projects tailored to the individual needs of customers (using various IT technologies).

To summarize, a comparison of selected features of the main categories of the company’s technology sources is presented in Table 1.

 
As it results, depending on their potential and capabilities, enterprises interested in building a competitive advantage on the market through technology development can be recommended the following sources of acquiring IT technologies:
  • enterprises with strong human resources, technology and economy: mainly using internal sources of technology transfer,
  • enterprises in an average situation in terms of development potential: where possible, using their own technology transfer sources, supported by technologies from combined sources,
  • enterprises with no development potential: using technologies from external sources, where possible, supported by technologies from combined sources.

 

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