A spiral process model of technological innovation in a developing country: The case of Samsung

Abstract

This article presents a spiral process model of indigenous technological innovation capabilities (ITICs) that shows how firms in a developing country initiate, imitate, improve and make innovative technologies. Any technological innovation passes through four stages: (1) technological innovation (TI), (2) transfer of technology (imitation), (3) adaptive technological innovation (improvement), and finally (4) indigenous technological innovation (local innovation). This paper reviews models and frameworks related to technological innovation capabilities (TICs) which are proposed in the context of developing countries. It then analyzes the Late-Starter, Samsung Electronics as a case in point to illustrate how Korean firms have built their ITICs. The model shows four developmental stages at Samsung Electronics as: (a) Entrance of foreign companies into the Korean market and their refusal to transfer their technologies to Samsung initiating its ITICs, (b) Samsung started TICs by means of reversing the engineering of imported foreign technologies and transfer of technology, (c) it improved TI by means of adaptive technological innovation strategy and finally (4) the capability to establish their own ITICs, to become one of the leading companies in the world which challenges firms from advanced countries in the global market. The paper also highlights the developmental changes in the semiconductor (DRAM technology) of Korea. Keeping past experiences in consideration, we conclude that this model provides useful implications for newly industrializing countries (NICs) following the same pattern of technological development.