Technovation 23 (2003) 719735 www.elsevier.

com/locate/technovation

Managerial perceptions of factors inuencing technology management in South Africa

Ian Hipkin a, David Bennett b,
a

School of Business and Economics, University of Exeter, Exeter EX4 4PU, UK b Aston Business School, Aston University, Birmingham B4 7ET, UK

Abstract A challenge for developing countries is to become part of the global economy. Their economic well being is dependent on their ability to attain the levels of technological development which could make them globally competitive. Infrastructural and educational problems pose immediate barriers which should be addressed as these countries embark on projects to enhance their technological base. The technology selected should be appropriate for the countrys level of development and expertise. The implementation of that technology will place a new set of demands on managers and workers. This paper describes an investigation of perceptions of technology management in South Africa, a country which is developed in certain areas, but which remains desperately poor in other respects. South Africas politics and history have always confronted managers with unique demands. The paper examines the perceptions of 132 South African managers regarding technology management by studying the relationship between the importance of different factors in managing new technology, and the extent to which a manager can control them. An importance-control grid framework is used to isolate individual parameters and to assess these in relation to the complexity of a managers environment. The research highlights imbalances between importance and control, and suggests reasons therefor. Some broader implications for managers are also discussed. 2002 Elsevier Science Ltd. All rights reserved.
Keywords: Technology; Technology transfer; Developing countries; South Africa; Management

1. Introduction The role of technology in the advancement of developing countries (DCs) is complex and controversial. There is wide acceptance that technological knowledge and competence are essential for global competitiveness (Barbosa and Vaidya, 1997; Husain and Sushil, 1997), but forces promoting global integration may conict with creating and sustaining local autonomy. This struggle is not against globalisation; rather, efforts must be made to establish the terms under which participation in globalisation can take place (Marcus, 1992). A more sanguine view of the dominant and irreversible role of technology in DC development is taken by Kahn (1995: 139) who maintains, it is an article of faith that the application of science and of industrial

Corresponding author. Tel.: +44-121-359-3611; fax: +44-121359-5271. E-mail address: d.j.bennett@aston.ac.uk (D. Bennett).

organisation would bring untold material benets to the modern world. Kuper (1999: 210) provides further support as civilisation advances, it will impose sacrices. There is no guarantee that it will promote individual happiness or advance the common good ... but the capital of humanity increases. The technological world is characterised by rapid changes in resource utilisation, increasing levels of decision complexity and intense competition (Sharif, 1997). Reduced development cycles and the pace of technological change place greater urgency on the need to adopt new technology if DCs are to begin to compete globally (Jegathesan et al., 1997), although DCs will not nd it easy to beat the hard-won technological advantage of the developed world. The extent to which DCs participate in the global economy will therefore depend on their ability to invest in and utilise technology. The management of knowledge and technical information, equipment and software comprising the physical technology itself (Wang, 1997) are areas of interest in technology transfer (TT) in general. In DCs other issues assume even greater

0166-4972/02/$ - see front matter 2002 Elsevier Science Ltd. All rights reserved. doi:10.1016/S0166-4972(02)00031-7

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importance, typically including human resources, skills and training, unique organisational issues, and lore (Adjibolosoo, 1994). This paper describes part of a broader study into the management of technology in DCs. The approach uses an importance-control grid to reect the perceptions of a sample of South African managers regarding the management of technology. The following section reviews some of the literature relating to technology in DCs. The sample and the importance-control grid are then described, and the results are analysed and their implications are discussed.

2. Literature review on factors inuencing technology management Technology transforms operations, facilitates the emergence of new industries, and creates new sets of economic activities. Low cost, low level technologies, which produce low value items only for their home markets no longer meet the broadening needs of DCs (Moor, 1994). Although innovation and technology development are concentrated in relatively few countries and organisations, corporate and political technology policies are now based on global considerations (Lall, 1993: 104). It may be argued that efforts in DCs should be directed at the provision of basic services to impoverished populations, but it is unlikely that adequate economic growth can be generated solely by internal demand. For example, more than 30% of South Africas exports are from manufactured goods competing in the global marketplace (South African Reserve Bank Quarterly Review, March (2001). Even if countries gave priority to issues, such as Aids, they would still need technology and expertise from the developed world. In order to gain signicant entry to world markets, the technology strategies of private enterprises in DCs will have to reect the trends, and meet the priorities found in the developed world: shorter product life-cycles, greater product diversity, more rigorous quality standards and demanding customers, fragmented markets and environmental consciousness (Sharif, 1997). New technology, whether imported or developed at home, is a key requirement for expanding the export base of a developing country. The TT literature discusses a range of factors, such as culture, economic and political issues, knowledge, and strategic, operational and supply chain arrangements (Eldred and McGrath, 1997; Gupta et al., 1997; Tyre, 1991). The literature deals extensively with the sociocultural dimension, and cultural proximity between supplier and adopter (Hemais, 1997). Kuper (1999: 210) suggests that cultural differences persist in a changing world: distinct ways of life once destined to merge into the modern world reassert their difference, in novel ways. Gergen and Whitney (1996: 333) see technology

as a mechanism for transformation, creating new forms of social construction arising from the adoption of alien beliefs, values and practices...undermining of traditions, colonisation of perceptions, attitudes and actions by the dominant party in a business relationship. Bowmaker Falconer et al (1998: 225) believe that a failure to understand cultural and other differences can lead to misguided assumptions, poor working relations, underperformance and discrimination. Mbigi and Maree (1995: 106) agree that cultural dimensions seem to have a signicant impact on the management of transformation. In considering the transformation brought about by technology in DCs, Lessem (1996: 86) refers to crossing the north-side divide, where the three interrelated facets of society, namely authority, economy and community, form an interrelated whole...the authority pole stands for the rationality of the north, and the community pole for the humanism of the south, the economy represents a force of pragmatic integration. Pragmatism would accommodate competing cultural identities in their quest for dominance (Oliver, 1998), and supportive distinctiveness, where, for example, African modernity complements the European and the new world modernity, yet it cannot be identied with it (Matustik, 1998: 112). There is a balance between ignoring culture and allowing the study of technology management to be subsumed by it (Kuper, 1999: 212). Peppard (1996) ascribes the divergent ndings of researchers to the different contexts in which research is conducted, and claims that wide differences in opinion do not permit simple and denitive conclusions to be drawn. Differences in cultures, industries and individuals are compounded by diverse political and economic systems, requiring the transfer of core techniques as well as business and management philosophies. Several authors (Adjibolosoo, 1994; Kahen, 1997; Kim, 1998; Lado and Vozikis, 1996) emphasise the inuence in technology planning of social and political factors, government policies, the acquiring countrys level of economic development, the absorptive capacity of local rms, the lack of research and test centres, IT infrastructure, and other industry linkages. Lall (1993) includes further barriers such as a lack of acquirer skills and education, inadequate technical and managerial know-how, poor infrastructure, inadequate intellectual property rights, government requirements and commercial habits (Grant and Gregory, 1997: 2). TT is an interorganisational process with multiple outcomes (Spann et al., 1995), requiring an assessment of costs, benets, and tangible improvements, (Hackman and Wageman, 1995; Wilkinson and Wilmott, 1995; Wilson, 1991). Assessments of success vary because objectives are ambiguous and inconsistent measurement standards render evaluation difcult (Armistead et al., 1995; Dixon et al., 1994). Less directly measurable are

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the non-quantiable merits of TT, such as compatibility features of the technology, and the technical and commercial effectiveness of the TT (Bennett et al., 1999: 511). Proactive individuals and technology champions in carefully designed and well-managed organisational structures advance TT through innovative ideas (Irwin et al., 1998). In accommodating interactions that result from new technology, managers need to rethink organisational processes that affect or are affected by the technology (Hart and Schlesinger, 1991; Sitkin et al., 1994; Tuckman, 1994). Lall (1993:100) sees many implicit elements in technology that need a long period of learning to master. These are a function of experience, but are enhanced by investment in training by the technology owner1 and acquirer, the search for new technical and knowledge solutions, and developing organisational capacities to create, communicate and diffuse knowledge internally. Successful TT depends on the cumulative experiences of key personnel. Explicit knowledge, in the form of hardware, procedures, and practices may form only a small part of the sum of knowledge to be transferred (Nonaka and Takeuchi, 1995), since the transfer of some technologies requires subtle skills and knowledge that are difcult to codify (von Hippel, 1994). The overall technological characteristics are the easiest to transfer (the explicit issues), with operational ne-tuning presenting the greatest challenges (Katz et al., 1996). Knowledge creation requires an understanding of all products and processes. The technology owner is frequently reluctant to reveal all about a technology, whereas the acquirer is keen to gain as much understanding as possible. The result is described by Marcus (1992) as an uncompromising sense of paradox between resistance and accommodation, with the sophisticated acquirer demanding greater access to codied knowledge and insisting that the owner makes tacit knowledge more explicit. Knowledge transfer depends on the ability to evaluate and learn all aspects of a technology. One functional discipline where this is particularly important is maintenance, which now demands greater attention for a number of reasons: intensied competition requires strict cost control, with maintenance accounting for an increasing share of operational costs (Paz and Leigh, 1994); safety and environmental disasters are increasingly attributable to equipment failure; maintenance itself is changing, with substantially different ways of understanding the nature of failure (Moubray, 2001); automated facilities operating in a just-in-time regime require higher avail-

Following the terminology of Bennett et al. (1999), a technology supplier is referred to as the owner of the technology, and the recipient is the acquirer.

ability and reliability from plant and equipment; new technology has introduced equipment and systems where no operating and maintenance experience exists. High levels of production competence and an understanding of equipment failure patterns are essential before maintenance requirements can be determined (Jaikumar, 1986; Cleveland et al., 1989; Ferdows and De Meyer (1990). The importance of appropriate technology, contextual adaptation, and developing technological capabilities and core technologies in TT to DCs is addressed by a number of authors (Barbosa and Vaidya, 1997; Grant, 1996; Husain and Sushil, 1997; Kim, 1998; Plenert, 1994; Virasa and Tang, 1999). Leonard-Barton (1995) sees technology activity between countries as a ow of technological capabilities, or knowledge-creating activities. Along a continuum of technological capability Leonard-Barton (1995: 221) identies four levels in a technology capability ladder: (1) assembly or turnkey operations, (2) adaptation and localisation of components, (3) product redesign, and (4) independent design of products. In DCs the rst two levels are more likely to predominate. The rst level is a process of converting or transferring scientic or technological knowledge directly into the satisfaction of a customer need; the product...(is) the carrier of the technology (Twiss, 1986: 4). For example, an automated system installed as a turnkey project may obviate the need for skilled operators and ensure consistently high quality, although it may not necessarily be suitable in a DC environment. Since it is not always possible to capture and describe all activities in procedures, and the appropriate degree of proceduralisation (and hence automation) depends on the level of knowledge of a process (Bohn, 1994), too high a level of technology can be extravagant and may render the process unworkable or worthless as intricate operational procedures cannot be followed or breakdowns become irreparable. The challenge at Leonard-Bartons second level is to identify appropriate technology and to assess the extent to which an owners technology needs to be modied for adaptation to local situations (Platt and Wilson, 1999). A 3-bridge mechanism for co-ordination (Katz et al., 1996) creates a structure for addressing problems of appropriateness for TT. The procedural bridge involves joint planning and stafng, and transferring know-how. The second bridge is the human bridge relying on establishing direct interaction between people from different organisations. Thirdly, organisational bridges use specially constituted transfer teams and processes to formalise TT. A facilitating feature of TT is the robustness of the technology, where transfer to any environment takes place without adaptation to local conditions: robustness is recipient-independent (Grant and Gregory, 1997: 4). Incorporating technological considerations in strategic decisions requires a balanced assessment of product complexity (for value maximisation) and process com-

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plexity (for cost minimisation) (Sharif, 1997: 314), but resources, and nancial and competency-based constraints will restrict DCs in their selection of technologies. Lennon (1997) discusses the need for continuous updating of equipment and processes, and the relevance for developing countries of attaining technological parity, achieved in part, by skills and infrastructural development, research, and education in a knowledge context (Davies, 1993). A resource-based view of knowledge management identies distinct capabilities and knowledge as the basis of differential rm performance. Helfat and Raubitschek (2000: 961) speak of the coevolution of knowledge, capabilities and products. As supply chain management becomes part of technology policy, local adaptation of technology invariably means greater involvement with networks and sourcing at second or third tiers in the local supply chain, requiring a network of capabilities, rather than networks of facilities (Leonard-Barton, 1995: 242). The transformation of collaborative agreements into productive and strategically effective relationships will be the real challenge of strategic alliance management in the 21st century (Irwin et al., 1998). The way in which technology is transferred depends on the technology, the strategy of the owner and the capabilities of the acquirer. South Africa exhibits some favourable attributes of a developed economy as well as the negative characteristics of the poorest countries. This study investigates perceptions of technology issues in South Africa, a country in a dual world (Wang, 1993). The management of technology in this study includes an investigation of factors discussed in the literature as well as others that may be peculiar to South Africa, such as afrmative action, employment equity, empowerment and stakeholder relationships (Pycraft and Bawden, 1996).

wished to convey in naming these. The authors then eliminated overlapping items, resulting in a list of 60 items. The managers in the rst and subsequent groups were then asked to score how important these items were in TT, and then to what extent they could control them. Prior to the scoring, an explanation of each factor was given to managers to ensure a consistent interpretation of all items. We explained to managers that importance referred to signicant issues in the workplace, where errors and lack of adherence to desired performance requirements might potentially carry serious consequences. Control related to a managers power to direct, regulate and inuence. The scoring was on a Likert scale of one (not important/no control) to ve (most important/much control) for the following criteria: How important this item is now, in so far as it affects your working environment How much control can be exercised over this item now How important this item will be in three years time How much control can be exercised over this item in three years time Table 2 shows the items and their groupings under factor headings (discussed later), with the average scores from the 132 participants for each item. Factor scores are weighted according to factor loadings derived from a factor analysis of current importance scores, and unweighted averages of the item averages are also shown. The purpose of this study was to obtain the opinions of, and insight into the perceptions of a strategically important sample of managers. As Linz (1988) has pointed out, in such situations sample size is less important than are experience, competency and objectivity of participants...the testimony of even a single expert informant on a particular topic is still valuable if treated with caution. Follow-up interviews of about 30 minutes duration, structured around the factors, were held with 42 managers in order to clarify and explain emerging results. The purpose of the interviews was to understand and interpret quantitative data through a qualitative assessment. It is of course unrealistic to expect verication or falsication to be absolutely certain and conclusive.

3. The study The paper examines the perceptions of 132 South African managers who were attending business school management development and executive management programmes at the University of Cape Town in 2000. The breakdown of the sample by industry sector is shown in Table 1. Although Table 1 gives racial and gender details, analysis of results by race and gender did not produce statistically signicant differences. In later discussions comments have been attributed to black or to white managers, as these can assist in explaining some individual differences in viewpoints otherwise disguised by averaged scores. The 30 managers attending the rst in a series of programmes were rst asked to list the issues that they believed were important in managing technology in their organisations. The responses produced 96 items. Where necessary, the authors claried what the managers had

4. The importance-control grid The research follows the methodology of Naude et al. (1990), and Naude and Hipkin (1998) in studying the relationship between the importance of different factors in a managers operational environment, and the extent to which a manager can control them. Managers tasks

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Table 1 Breakdown of sample of South African managers, N=132 Sector Construction Consumer goods manufacture Financial institutions Heavy manufacturing IT Mining Automotive Retailing Males Black males White males Females Black females White females Number of respondents 14 20 19 28 8 21 13 9 Number of respondents 74 51 23 58 41 17 Percentage 11 15 14 21 6 16 10 7 Percentage 56 39 17 44 31 13

demand attention to important issues, but Naude et al. (1990) show that, particularly in transitional environments, managers frequently nd themselves without sufcient control of these factors. The framework enables the researcher to isolate individual parameters and to study these in relation to the complexity of a managers environment. By plotting the scores on a grid, the following distinct areas may be identied: core issues, which managers see as the most important and over which they can exercise the most control; these issues require the greatest management time, effort and planning complex issues, which are perceived as being important but over which managers can exercise limited control simple issues, which are of lesser importance and which are easily controlled by management peripheral issues, which are generally of limited importance and over which little control can be exercised. The grid provides a useful methodology for identifying such problems, and can be extended to suggest action for improving technology adoption. The terms core, complex, simple and peripheral are labels for easy reference to the quadrants. Such labels cannot fully describe all possible combinations of complexity, importance, frustration, control and other challenges in managerial decision-making. The form of the importance-control grid is shown in Fig. 1 on which the current and future factor scores (see next section) have also been plotted. Figs. 2 and 3 contain the current and future item scores. Using factor analysis on the current importance scores, the items were grouped into ten factors: technology and operations strategy, political and economic issues, knowledge and human resources, maintenance,

planning and infrastructure, supply chain partnerships, nancial, technology and technology transfer, technology management interface, resistance to new technology. The importance-control grid depicts the degree of alignment between importance and control: the greater the distance of a factor from the diagonal, the larger the degree of imbalance. This is likely to lead to frustration or inappropriate managerial intervention. The frustrating extremes for managers occur in quadrants two and four. Spending disproportionate time on simple issues (quadrant two) represents poor utilisation of managerial resources. The deemed importance of complex issues (quadrant four) cannot be matched by a managers ability to control, since complex issues defy understanding and manipulation, and can be expected to frus trate those dealing with them (Naude et al., 1990: 524). In using the framework to analyse managerial perceptions, these authors speak of an underlying dynamic nature to strategic issues implying a migration around the grid (p. 524). Peripheral issues representing a balance between importance and control are expected to be relatively stable. Factors in other quadrants may respond to long-term trends or unexpected events, which result in repositioning, particularly in the complex quadrant, where high importance is not associated with commensurate control. The resulting misalignment will require conscious management efforts to increase control over these. Once balance has been achieved, importance recedes, and managers need merely to maintain these issues, rather than concentrate on their control. Movement is towards the simple issue quadrant. The challenge is then to address those issues that, over time, move from the diagonal into the complex quadrant. The discussion below concentrates on those factors that reect greater degrees of imbalance, and signicant differences between present and future scores.

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Table 2 Factors inuencing the management of technology Factor loading Code Import Control ance now now Importance Control 3 z-score z-score 3 years years importance control

FACTORS AND ITEMS

TECHNOLOGY AND OPERATIONS STRATEGY Weighted factor score Unweighted factor average Assimilation of technology Technology as strategic resource for competitive advantage/business success and defence core competences Technology implemented because of market demand (demand-pull) The internet Greater output through technology Lead time to acquire technology/spares Better quality through technology Alignment of business goals, systems and technology 0.918 0.850 0.841 0.830 0.816 0.758 0.613 0.563 S S1 S2 S3 S4 S5 S6 S7 S8 26.7 4.3 4.3 4.4 4.3 4.1 4.6 3.9 4.6 4.4 22.3 3.6 3.1 4.2 3.9 4.0 3.5 2.5 3.4 4.4 28.1 4.5 4.5 4.7 4.6 4.7 4.6 4.0 4.6 4.6 25.2 4.1 3.5 4.5 4.2 4.2 4.1 3.8 3.8 4.6

1.79 2.31 2.02 3.45 0.53a 1.04 0.54 1.80

2.02 2.09 2.06 1.67 3.45 7.09 2.45 1.77

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POLITICAL AND ECONOMIC ISSUES Weighted factor score Unweighted factor average Crime levels in South Africa Government regulations and bureaucracy (planning permission, work permits, etc.) Low educational levels of labour Overall level of economic development and infrastructure Pressure from labour unions, afrmative action and employment equity policies The brain drainskilled people leaving the country Effects of globalisation 0.757 0.517 0.840 0.705 0.799 0.910 0.727 P P1 P2 P3 P4 P5 P6 P7 23.7 4.5 4.8 4.0 4.8 4.2 4.7 4.6 4.2 9.1 1.7 1.4 1.2 1.7 1.4 2.0 1.3 3.0

24.6 4.7 5.0 4.4 4.9 4.5 4.4 4.9 4.5

9.6 1.8 1.4 1.3 1.6 1.3 2.4 1.4 3.3

2.62 2.24 1.70 2.06 1.99 2.15 2.01

0.52 1.25 1.09 1.34 2.50 1.34 2.02

KNOWLEDGE AND HUMAN RESOURCES Weighted factor score Unweighted factor average Lack of labour commitment and productivity/ability to take responsibility Communications and IT systems for data analysis Understanding complex technology through direct interaction and observation Empowerment The learning organisation Understanding hardware and software Cost of training and developing local workforce

0.589 0.583 0.925 0.565 0.816 0.788 0.483

K K1 K2 K3 K4 K5 K6 K7

19.7 4.2 4.6 4.3 4.4 3.7 3.5 4.2 4.5

15.1 3.2 2.0 3.9 3.5 3.8 2.2 3.8 3.0

20.8 4.4 4.8 4.3 4.6 3.9 4.1 4.4 4.5

17.0 3.6 3.0 4.2 3.2 4.2 2.9 4.0 3.9

1.81 0.53 1.75 1.65 3.99 1.73 0.00

6.42 1.97 1.85 2.36 4.04 1.19 5.32 (continued on next page)

Table 2 (continued) Factor loading Code Import Control ance now now Importance Control 3 z-score z-score 3 years years importance control

FACTORS AND ITEMS

MAINTENANCE Weighted factor score Unweighted factor average Availability and reliability of equipment Understanding of how technology works and how it fails Failure data Effects of failure on process Appropriate maintenance action (time/condition based) 0.677 0.781 0.826 0.885 0.795 M M1 M2 M3 M4 M5 17.6 4.5 4.8 4.2 4.4 4.3 4.6 0.31 0.88 1.88 2.07 1.88 12.5 3.2 3.6 3.1 3.1 2.6 3.5 18.4 4.6 4.8 4.4 4.6 4.6 4.8 14.2 3.6 4.2 3.5 3.6 3.0 3.8

3.33 2.36 3.16 2.00 1.84

PLANNING AND INFRASTRUCTURE Weighted factor score Unweighted factor average Promoters/champions of the technology Belief in need for and commitment to technology, and establishing clear objectives for technology Establishing supplier networks and accessing local infrastructure Internal infrastructure to integrate/formalise technology throughout org; create feedback mechanisms Process optimisation systems to support technology 0.922 0.704 0.833 0.668 0.743 PI PI1 Pl2 Pl3 Pl4 Pl5 15.8 4.1 3.8 4.7 3.8 4.5 3.8 14.6 3.8 4.3 4.0 3.1 3.7 3.7 16.7 4.3 4.1 4.8 4.1 4.5 4.2

15.9 4.1 4.3 4.3 3.6 4.0 4.3

1.96 0.74 1.99 0.51 2.28

0.55 2.39 2.53 1.82 3.52

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SUPPLY CHAIN AND PARTNERSHIPS Weighted factor score Unweighted factor average Assistance from technology partners Contractual arrangements Compatibility between supplier and user Appropriate technology base established from partnership 0.866 0.875 0.894 0.896 Sc Sc1 Sc2 Sc3 Sc4

15.5 4.4 4.6 4.7 4.0 4.3

13.5 3.8 3.9 4.4 3.2 3.8

16.1 4.6 4.7 4.6 4.5 4.4

14.1 4.0 4.1 4.5 3.4 4.0

0.57 0.42 2.92 1.15

1.73 0.53 1.76 1.65

FINANCIAL Weighted factor score Unweighted factor average Cost of technology acquisition Short term protability required from technology Hidden costs of technology (including TT, HR development, environmental, etc) Justication of technology on a cost/benet basis (lower production costs)

0.855 0.725 0.535 0.775

F F1 F2 F3 F4

12.6 4.4 4.6 3.5 4.6 4.7

6.0 2.1 1.9 2.3 2.4 1.9

12.8 4.5 4.7 3.6 4.8 4.7

8.1 2.9 2.1 3.0 3.6 2.8

0.58 0.47 1.70 0.15

1.68 4.29 7.30 5.21

725

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Table 2 (continued) Factor loading Code Import Control ance now now Importance Control 3 z-score z-score 3 years years importance control

FACTORS AND ITEMS

TECHNOLOGY AND TECHNOLOGY TRANSFER Weighted factor score Unweighted factor average Adaptability of technology to local conditions Use of expert systems/intelligent machines Robustness of technology: installation without adaptation Sensitivity of technology in terms of design, fabrication, operation and maintenance 0.558 0.713 0.798 0.849 T T1 T2 T3 T4 11.6 4.0 4.3 3.5 3.9 4.2 2.06 3.48 0.66 0.00 6.7 2.4 3.5 3.1 1.6 1.5 11.7 4.0 3.9 4.1 3.8 4.2 6.7 2.4 3.3 3.4 1.3 1.7

1.83 1.77 1.83 -1.72

TECHNOLOGY MANAGEMENT INTERFACE Weighted factor score Unweighted factor average Capacity of recipient company to manage change and new technology with technology partners Complexity of technology Shortage of skilled personnel 0.538 0.450 0.538 TI TI1 TI2 TI3 7.0 4.6 4.2 4.6 5.0 4.0 2.6 3.8 2.4 1.7 7.2 4.7 4.4 4.8 5.0

4.2 2.7 4.1 2.0 2.0

1.66 0.95 0.00

1.77 2.49 2.01

RESISTANCE TO NEW TECHNOLOGY Weighted factor score Unweighted factor average Difcult to accept other ways of working Resistance to technology because it is not local 0.844 0.750 R R1 R2 2.7 1.7 1.7 1.7

5.1 3.2 3.0 3.4

2.0 1.3 1.3 1.2

5.3 3.3 3.4 3.2

2.36 3.30

2.31 0.96

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z-scores in italics: difference between importance or control now and in the future is not statistically signicant at 95% signicance level.

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Fig. 1.

The importance-control grid: current and future perceptions (factor scores).

Fig. 2.

Current perceptions of importance and controlitem scores.

5. Factor analysis results Factor analysis was used to group the items into a number of factors that would indicate the most signicant components in technology management. In this discussion factors (or components, which is the term frequently encountered in factor analysis) will refer to clusters...that could be measuring aspects of the same underlying dimension (Field, 2000: 423). Details of the factor analysis are not included here, but some of the signicant ndings are summarised. Using the current importance scores, 16 eigenvectors with eigenvalues greater than one gave 16 factors that explain 85% of the total variance. A scree plot revealed a point of inexion after ten factors (with eigenvalues, which happen to be greater than two, explaining 71% of the variance). Relatively high communality values after extraction (ranging

from 0.682 (Contractual arrangements) to 0.952 (Technology as a strategic resource) indicate that the variance associated with each item has a high common variance. From the rotated component matrix calculations, 16 factors are identied where variables load highly onto these components (Field, 2000: 463). Ten of these have been selected as the remaining six have only one or two variables associated with them, with low factor loading scores. The items and factors with factor loadings are shown in Table 2. Although respondents scored 60 items, the rotated component matrix results do not include 11 of these items in the 10 factors selected, so these items have been excluded from further analysis and discussion (with one exception, Aids, which this will be mentioned later).

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Fig. 3. Perceptions of importance and control in 3 years timeitem scores. Key to abbreviations: S, Technology and operations strategy; P, Political and economic issues; K, Knowledge and human resources; M, Maintenance; PI, Planning and infrastructure; Sc, Supply chain and partnerships; F, Financial; T, Technology and technology transfer; TI, Technology management interface; R, Resistance to new technology; current perceptions; + future perceptions.

6. Results and discussion The rst group of managers was asked to list issues important to them, so it is expected that most factors here would lie on the right hand side of the grid (quadrants three and four). This section discusses the scores and suggests explanations therefor. While the statistical analysis was useful in determining the factors and providing an indication of their relative importance, reference is also made to the interviews conducted with 42 managers during the research. 6.1. Technology and operations strategy The current weighted importance score for this factor is the highest (26.7), indicating that the items included in this factor are statistically the most signicant in technology management. Apart from the item relating to the current lead-time to acquire spares, all other technology and operations strategy items are in the core quadrant in the importance-control grid. It is also estimated that the items will become more important, and more control will be possible in the future. In the interviews, managers indicated that control of spares availability and leadtime was limited because of South Africas geographical position. This situation would improve as business-tobusiness transactions and the internet became more widespread. The high scores for better quality and greater output, strategic alignment of business goals and technology, the use of technology as a strategic resource, and a general desire to achieve customer sovereignty (Baines et al., 1999), all support ndings in the literature (see, for example, Bolden et al. (1997).

6.2. Political and economic issues Political and economic items lie rmly in the complex quadrant, all receiving high importance, but low control scores. These issues potentially constitute the greatest cause of frustration to managers who see an increase in the importance of these items, but envisage only a marginal improvement in control in the next three years. The scepticism on the part of business and commerce towards much of the South African governments labour legislation has been widely reported (for example, von Holdt, 2000). Most managers saw little chance of this changing in the next three years (although changes to some labour legislation have been announced (Government Gazette, 27 July (2000)). The frustration expressed by managers conrms what has been said in many instances regarding the relationship between business and the government (Business Day, 30 August, 2000). Much of the business community has a different socio-economic perspective to that of the government whose constituency lies to a large extent with workers and poorer sections of the community (Sunday Times, 6 August, 2000). Some white managers noted that afrmative action and employment equity policies compounded their difculties in controlling the work environment. The only individual factor appearing in quadrant three relates to the effects of globalisation (P7). Managers explained that they could control this by directing their businesses to be part of the global business environment. During the interviews there was divided opinion between black and white managers regarding political and economic items. Black managers viewed govern-

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ment regulations and bureaucracy, levels of economic development and pressure from unions as having limited signicance, whereas white managers saw these as important. Neither group of managers saw that much could be achieved through discussions with the government. Low education levels were of concern to black managers at present and would become more important in the future. Yet, some control of this factor was considered possible through better schooling, bursaries, and education programmes funded by business, particularly as the legacy of apartheid education worked its way out of the education system. In contrast, white managers considered education important, but envisaged little control over this item, particularly as the governments limited resources would not be able to improve the education system in the foreseeable future. They did not see a role for business in education. There was unanimity from blacks and whites regarding the serious effects that crime is having in South Africa. While there was consensus that little could be done about the brain drain, opinions about its importance varied. Black managers recognised the problem of losing skilled people, but also saw greater opportunities for younger blacks to take up the positions of those who had left the country. White managers saw the loss of this expertise as irreplaceable. As with certain other items, black managers viewed these issues as being of lesser importance, but something could be done to control them (quadrant two, simple issues), whereas white managers considered them of great importance, about which little could be done (quadrant four, complex issues). 6.3. Knowledge and human resources

largely beyond control. It was clear that not all managers fully grasped the concept of the learning organisation as a path to knowledge, although some did appreciate its potential contribution. Most respondents gave South Africas poorly educated labour force and weak education systems as further reasons for not being able to create a learning organisation2. Empowerment received a moderate importance score (3.7). Controlling empowerment was interesting as it is a bargaining tool to persuade unions to agree to new technology in return for promises of empowerment. Some managers recognised the contradictions in an empowerment process: implementing and operating a new technology do not readily lead to participation as employees actions are dened almost entirely by the technology, meaning that behaviour cannot be empowering and liberating (Argyris, 1998: 101). We did not interview employees to establish their feelings on the subject. Managers believed that empowerment could be controlled, with employees reluctantly toeing the line (Argyris, 1998: 101) in accordance with welldened processes and procedures. During the interviews the small increase in the factor control score was explained by managers predictions that some knowledge could be documented, transmitted and utilised, although they were vague on the mechanisms for achieving this. Several respondents saw that middle managers would be an essential interface between islands of information (Dutta, 1997), yet recent downsizing exercises had reduced their number, thus diminishing the extent to which the learning organisation could be expanded. 6.4. Maintenance

From the factor analysis, items relating to knowledge and human resources are grouped as one factor. While we did not initially expect this, it is perhaps not surprising as managers perceived the skills of the workforce, training and knowledge to be closely related. All items lie in the core quadrant except K1 (lack of labour commitment, scored highest in importance) and K5 (the learning organisation, scored lowest in importance). Differences on a racial basis emerged regarding control of commitment and productivity: black managers saw better training and labour relations as the solution, whereas white managers envisaged that mechanisation would reduce dependency on militant trade unions and workers. Managers appreciated the importance of understanding technology, but only some respondents recognised that the deeper benets of technology depend on the exploitation of knowledge. Managers saw the relevance of tangible knowledge factors such as communication and understanding hardware and software, but as indicated in the literature (Inkpen, 1998; Nonaka and Takeuchi, 1995), the learning organisation remains elusive and

The unweighted factor average for maintenance was scored the second highest in importance (4.5). With one exception (effects of failure on the process), all items are in quadrant three, but well below the diagonal. Managers were unanimous that maintenance is growing in importance, particularly as maintenance costs increase (this concurs with Moubray (2001)). Lower control scores illustrated managers problems with new equipment, lack of experience and little or no failure data. Understanding the functionality of equipment (present control score of 3.1) could be controlled to some extent by training, but lack of control over the effects of failure meant that knowledge of true functionality was some way off.
2 Our study was undertaken shortly after the publication of a study which showed that South Africas grade four pupils (1011 year olds) rank lowest in numeracy, literacy and life skills compared with their African counterparts. A Unesco report on global basic education found that at least 13% of 614 year olds in South Africa do not attend school (Finance Week, 21 July, 2000).

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Several managers pointed to the link between knowledge and maintenance: knowledge and documentation, and understanding complex technology were essential for good maintenance. The type of statement frequently made was: you cannot x something if you dont know exactly how it works, and what the machine is required to do. You are not going to put that much effort into maintaining something if you dont know how important it is, and what really happens when it breaks down. One manager clearly saw that extending learning and knowledge concepts to maintenance would improve the performance of equipment and would reduce the effects of failure. She emphasised the importance of this way of thinking, but was unsure of how to achieve it (the control aspect). This is supported by the ndings of Hipkin and Lockett (1995) on the importance for maintenance of understanding equipment functionality and achieving desired performance targets. From our interviews it became clear that some managers were unaware of the importance of knowledge in a maintenance context. Further, they could do little to improve availability and reliability, their failure data records were of limited use, and the scope for appropriate maintenance action was restricted. Some future maintenance control scores are a little higher than current scores, indicating limited improvement in maintenance performance in the future (unless maintenance management information systems could be implemented to address uncertainties confronting the maintenance function). 6.5. Planning and infrastructure The unweighted factor average scores for planning and infrastructure show the greatest alignment between importance and control with both the present and future factor scores lying near or on the diagonal: a perfect balance for management. This is not surprising, as managers should be able to control the planning issues they have identied as being important. Item scores reveal some deviation from the diagonal. Establishing supplier networks is important but presently difcult to control. Managers ascribed this to a lack of a network culture in South Africa, in that suppliers were still instinctively seen as adversaries, rather than partners. The importance scores for commitment to, and objectives for, technology (PI2) and internal infrastructure (PI4) were by far the highest. Several managers recounted previous experiences where technology had been introduced for technologys sake without clear objectives, and such instances had been expensive failures. There was a strong feeling that technology should not be introduced just to be fashionable, and it would only be useful if local infrastructure were capable of accommodating the new technology. Often this referred to IT and communications, but other instances such as

internal reporting and performance measurement systems were cited. 6.6. Supply chain and technology partners The current and future importance scores indicate that some form of technology partnership is essential for new technology implementation, and that can be controlled through good supply chain selection and contractual agreements (the highest control score in this grouping). Managers did not see signicant benets from a simple contractual agreement whereby, say, a machine was purchased. The challenge was to transform collaborative agreements into productive and strategically effective relationships. The importance of user and supplier compatibility (average scores increase from 4.0 to 4.5) is supported by Inkpen (1998) who claims that as users gain experience in using partnerships, they became more adept at using technology partners for learning and knowledge acquisition. One respondent believed that South African managers were still learning how to deal with (and control) technology partners, and did not fully appreciate the signicance of compatibility between user and supplier (Sc3). Some managers felt that control effectively meant obtaining assistance from technology partners, as greater input from them would ultimately result in better control of technology. 6.7. Finance The present and future importance scores for nancial items are consistently high. Low control scores show nance to be a complex issue in quadrant four. Frustration derives from the inability to do anything about the cost of imported technology, aggravated by a declining currency. The future control score is higher as respondents felt that greater choices of technology would permit multi-sourcing of new technology. Through a greater understanding of the technology, managers felt they would better be able to control the hidden costs of technology implementation, which had so far bedevilled their use of imported technology. While justifying new technology would become more important as costs continued to rise, some managers remained sceptical about the reliability of certain cost justications. This is reinforced by Jelinek (1996: 810) who claims that traditional measures can be inappropriate or wildly dysfunctional, and in the extreme case old measures do not work on new technology. In the interviews, some managers were condent that prudent management would result in better cost control in the future.

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6.8. Technology and technology transfer The importance scores relating to the technology itself are relatively high, but control is low, as managers feel rather powerless in relation to the adaptability, complexity or robustness of a technology. This is somewhat of a contradiction as managers also believed they have a wide variety of technology suppliers to choose from, could select the supplier that best suits the acquiring rm, and thus exercise some control over the technology that is nally installed. Adaptability of technology (T1) is scored highest in importance in this category, followed by sensitivity of the technology in terms of design and operation (T4). This is in line with the general comments of Grant and Gregory (1997) regarding adaptability to local conditions. Managers felt that they could exercise some control over the adaptability of technology through specications at the design stage, but they have no control over technology design and fabrication. Managers perceived lack of control over operation and maintenance means that they have no inuence over how the designer intended the equipment to operate and how it should be maintained. Expert systems and intelligent machines were seen as important future developments, although control of these would remain limited. Managers saw the intelligent machine as a device which can store information and permit retrieval for utilisation as knowledge, thus allowing non-experts to solve problems beyond their present expertise: using the machine to solve know-how and know-why problems (Bohn, 1994). They acknowledged this was some way off, and that such technology may be prohibitively expensive. 6.9. Technology management interface Only three items are included in this factor, and these have amongst the highest current and future importance scores. Shortage of skilled personnel was the most frustrating item (importance score 5), but little could be done in terms of controlling this. Complexity of technology is also a complex item (in quadrant four). In the interviews this item was linked to knowledge acquisition and maintenance. Managers were concerned that overly complex equipment would be thrust upon them as fashionable in a global environment. Their concern was that they would not be able to use the technology to its maximum potential (if at all), and if they did, they would remain totally dependent on the technology supplier for support. 6.10. Resistance Two items appear under this heading. They have extremely low importance scores, and higher control

scores, placing them in the simple quadrant. Managers paid little heed to these in practice, as none of the interviewees had encountered serious resistance to new technology. The importance weighted factor score for this factor is by far the lowest, and this is intuitively supported by the managers lack of interest in the factor. 6.11. Aids In the scoring process, Aids received an importance score of 5. This does not appear in Table 2 as low correlations in the factor analysis eliminated this variable. Aids-related illness and death were matters about which managers could do little, but Aids was having a signicant impact on succession planning and training. One manager claimed that for every craftsman or skilled operator that was required, three were trained, but even with the additional people trained, he foresaw a shortage of craftsmen because of aids-related illnesses and death. The report of the South African Medical Research Council (Dorrington et al., 2001) revealed that in 2000 40% of all deaths in the age group 1549 were Aids related, and this is precisely the age group that would receive technical training.

7. Implications in a broader context The ndings corroborate some of the research studies cited in the literature, but question others. An understanding of TT in South Africa was sought from the interviews, the purpose of which was to interpret responses and to give some impressions a meaning (Alvesson and Deetz, 2000: 21). Yet, drawing conclusions from a single individual can provide a distorted view, so attention should shift to the shared cognitive reality experienced by organisational members (Jelinek, 1996: 808). We were not in a position to seek the opinions of other organisational members, nor did we interview anyone other than managers, so our conclusions are limited to managerial perceptions. Technology has the best chance of being transferred successfully if it is co-ordinated at strategic level and aligned with corporate goals and internal capabilities with the purpose of achieving competitive advantage (Leonard-Barton and Deschamps, 1988; Martinsons and Schindler, 1995). The results further support authors such as Burcher et al. (1999) and Grant and Gregory (1997) that technical interface management requires integration of systems and human resources with the technology itself. An interesting nding relates to culture, which frequently appears in the literature on TT to DCs. The original list of important issues for TT from the rst group of managers contained several items pertaining to culture. The factor analysis revealed that these did not cor-

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relate with other variables, so they were eliminated. Some interviews were held before all data had been collected and the factor analysis was performed when all data had been collected. This meant that we discussed cultural matters in the interviews. Our ndings concerning the relationship between cultural factors and technology management showed the greatest divergence with some of the literature. We found little evidence that cultural variables in South Africa are signicant in the management of technology. One interviewee pointed out that African culture is different from, say, European culture at a social anthropological level, but in the business world, any such differences play no part. A black manager commented: We downplay the importance of culture, as its not fashionable in business to talk about culture. Its not western or modern. One of the previous governments justications for apartheid was cultural difference between blacks and blacks, and between blacks and whites. We do not want to talk about those things. A second respondent claimed that the South African business climate is based on market-driven western values (comparable to the cultural homogeneity discussed by Phillips et al., 1994), so no cultural barriers arise. This corresponds to Lessems (1996: 36) contention that South African economic and educational institutions are modelled on Anglo-Saxon heritage more than any other(and that) business has drawn on a pragmatic western-ness for its material body and upon a rational northern-ness for its organisational mind. A third manager commented, The outside world is not interested in our culture. We may pride ourselves that we are a rainbow nation, but that is an internal matter which we can practise at home. If we want to compete, which we must, we must accept the outside worlds way of doing business. This indicates apparent acceptance of the western way and illustrates how local actions experience t with a global perspective (Marcus, 1992: 311). With the current mood of Afro-pessimism, one black manager commented that it would be expected to nd managers who are frustrated by political and economic matters. The wide divergence between importance and control scores demonstrates this, supporting the contention of Heald and Rakusin (1996: 37) that economic and political indicators of deep-rooted conict can lead to impotency and powerlessness. Managers accepted that throughout the world businesses have been subject to a degree of government legislation, and this is not a new phenomenon since businesses were required to implement the apartheid legislation of the previous South African government for more than four decades. Several white managers complained that the international trend was to have less regulatory interference. Yet, in the South African context, afrmative action and employment equity requirements were placing an unfair

burden on South African business, limiting even further its international competitiveness. Technology can play a valuable role in knowledge management as it becomes increasingly important at a strategic and operational level, but managers were despondent at the dearth of managerial and technological skill available from a poor educational system, and low levels of commitment by the workforce. Heald and Rakusin (1996: 37) predict that the consequences of inappropriate or non-existent education and training are further ignorance, incompetence and rolelessnesswith a very real sense of (being) frightened into doing nothing through ineptitude. A shortage of skilled personnel remains one of the issues that shows the greatest imbalance between importance and control scores. Herein lies one of South Africas most formidable challenges. Jegathesan et al. (1997) see technological systems as networks of agents, interacting in a specic economic zone, and operating within certain infrastructural parameters. The relatively low importance attached to networking by South African managers may lead to suboptimal TT, particularly from a knowledge acquisition point of view. From the interviews it was clear that networking is a relatively new concept for South African managers as they were denied access to many external contacts in the apartheid years. One manager commented that the result was a drive for self-sufciency, and to demonstrate this, almost as a matter of pride. Others warned of over-dependence on imported technology, leading to what Fohrbeck and Wiesand (1981) refer to as over-development. Where managers do network, force of habit makes them look within the country rst. They must learn to look beyond its borders. This pride also manifests itself as a form of arrogance. The majority of managers interviewed claimed that no adaptation of technology to South African conditions was necessary. A few managers pointed to the folly of such misguided boasting, and were adamant that South Africans must recognise that they are incapable of implementing technology of the most complex type. The extent to which ndings from this study can be generalised is pertinent, as social phenomena relating to one situation may change too much in another to permit meaningful generalisation (Patton, 1990). Findings may therefore be construed as localised, and may apply only in a limited social context. Generalising from a specic situation becomes a working hypothesis, not a conclusion (Cronbach, quoted in Patton, 1990: 280). It is thus not possible to replicate precisely the models which are applicable in one country to another, but technology management in one setting can offer useful guidance to others for policy formulation and implementation (Salami and Reavill, 1997). Both the methodology and the ndings of this study may prove useful to managers in developing countries. The statistical results generally corroborate the senti-

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ments expressed in the interviews and the ndings from the importance-control grid plots. While the importancecontrol framework provides no formal ranking of the factors, the factor analysis results provide a useful summary of the most signicant issues in TT. The factor in Table 2 which we have labelled Technology and operations strategy (weighted factor score 26.7) appears to be the most critical, followed by Political and economic issues (score 23.7), Knowledge and human resources (score 19.7), Maintenance (score 17.6) Planning and infrastructure (score 15.8), and Supply chain and partnerships (score 15.5). These were the issues managers preferred to discuss in the interviews. Other factors (Financial, Technology and technology transfer, Technology management interface and Resistance to new technology) included fewer items and had lower weighted factor scores. This concurs with Samli et al. (1992) who argue that managing technology in DCs has more to do with macro conditions than micro issues. No commonality can be detected in the items scored by managers, but eliminated in the factor analysis: cultural issues, Aids, intellectual property rights, technology implemented because of supplier pressure (technology push), back-up or diversity of suppliers, explicit (codied) knowledge and documentation. Table 2 also contains z-scores for testing whether the differences between present and future importance and present and future control scores are statistically signicant. The z-scores in italics (less than 1.645) indicate that for =0.05 there is no signicant difference. There is no clear pattern to indicate which items are signicant, but 29 out of 49 importance scores, and 38 out of 49 control scores demonstrate a signicant difference between present and future scores.

Africas history it is perhaps not surprising that managers are divided on the role of the government and politics in business. Those who mistrust political motives seem resigned to accept that the political agenda will not go away. The ndings in this study suggest areas for further research into TT in DCs. The high importance scores for maintenance support Leonard-Bartons (1995) assertion that maintenance is one of the most problematic issues in technology management. The results of this study provide a basis for more detailed investigation of the relationship between the maintenance function and TT, particularly as skills and knowledge deciencies in DCs have a signicant impact on maintenance policies and practice. The role of technology in strategic decisions is still ill dened in South Africa, but global forces are likely to pressurise managers to introduce new technologies wherever possible. For the foreseeable future, South Africa will import technology with limited local technical and operational input. This is to be expected in a developing country where research and innovation initiatives are limited, and whose economy is still greatly dependent on technical expertise from abroad. References
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Ian Hipkin teaches in the School of Business and Economics at the University of Exeter. Prior to this he taught Operations Management at the University of Cape Town, South Africa, and Manchester Business School. He has consulted in engineering management to rms in Europe, North America and Africa, with specic emphasis on asset management and knowledge transference. His research interests include the strategic use of technology and its transfer to less developed countries, and the problems of using and maintaining new technology. He is currently doing his PhD at Aston University studying technology transfer to developing countries. David Bennett is Professor of Technology Management at the Aston Business School, Birmingham, UK, and Deputy Head of School for External Affairs. His research interests include the transfer of technology between industrialised and developing countries, especially in the Asian region. He is also an Adjunct Professor with the University of South Australia involved in the universitys offshore doctoral programme in Singapore and Hong Kong. Previously he has been a faculty member at the China-Europe Management Institute in Beijing and the China-Europe International Business School in Shanghai. His industrial experience periods in the automotive components and electrical equipment industries. He holds MSc and PhD degrees from the University of Birmingham.