Technology Acquisition Decisions Research Articles

UNISON framework of system dynamics-based technology acquisition decision for semiconductor manufacturing and an empirical study

Semiconductor industry is technology-intensive and capital-intensive, in which semiconductor manufacturing companies strive to continuously migrate to advanced process technologies with productivity and quality to maintain competitive advantages effectively and efficiently. Since technology acquisition and capacity expansion take a long lead time, the present problem is a strategic decision under uncertainties that needs both human judgments and analytical approaches. Limitations of the existing studies can be traced in part to the lack of a framework within which different strategies can be evaluated while considering dynamic and uncertain market condition with systematic decision approaches. Focusing on realistic needs, this study aims to propose a framework for analyzing technology acquisition decisions with analytics based on historical data and conduct an empirical study for semiconductor manufacturing to reduce the risks and optimize the expected benefits. A system dynamic-based model was employed to clarify the dynamic interactions to evaluate the expected outcomes of the technology acquisition strategies. Moreover, sensitivity analysis is conducted to investigate the impacts of key factors to provide insights into different market scenarios for the decision-makers. The results of the empirical study have shown the practical viability of the proposed approach.

What Decision-Makers Want and What They Have Been Getting

I believe we would all agree that the only reason we produce health technology assessments (HTAs) is to inform health policy decisions, and when they fail to do so they are a waste of time and effort. Nevertheless, at the present time it seems that HTAs often have little impact [1–4]. My first objective will be to consider some of the factors that cause HTAs to fail to influence policy. My second will be to report on an ongoing experiment in HTA development that attempts to minimize these factors, and has resulted in an extremely high impact of HTA reports on health policy decisions. Before I start, I have two caveats. First, my remarks are not evidence-based. They are reflections resulting from my reading and my personal experience both as an HTA producer and as a health-care decision-maker. Second, my experience is mostly Canadian, so some of my reflections may not be completely relevant to other countries. Furthermore, the decision-makers I will be referring to are the meso-level policymakers, the people who make technology acquisition decisions at the hospital or regional level. In our Canadian system of universal health insurance, top-level policy, such as decisions on what programs will be funded, are taken at government level. Increasing the impact of HTAs on such decisions has been discussed elsewhere [5]. But hospitals or regions mostly take meso-decisions, such as those on the acquisition and use of new technologies. These organizations are usually given a capped budget and expected to conform to the Canada Health Act, according to which they must to give all “necessary” treatments to all Canadians, a feat that clearly requires careful prioritization. Sound prioritization decisions require well-prepared, objective evidence such as is found in HTAs. So if HTAs are not influencing these decisions it is urgent that we consider what to do about it. Our options are limited. I believe the UK solution to this problem is not an option for us in Canada. In the UK the final path of all HTAs is the National Institute of Clinical Excellence (NICE), and their policy “recommendations” are now virtually mandatory, and Regional Authorities are required to follow them. North America is probably too big and regional differences too great for such a solution to be accepted. So we must consider the other option. We must ask why many HTAs lack impact and what we can do about it.

An integrated process for forming manufacturing technology acquisition decisions

The right manufacturing technology at the right time can enable an organisation to produce products that are cheaper, better, and made faster than those of the competition. Paradoxically, the wrong technology, or even the right technology poorly implemented, can be disastrous. The decision process through which practitioners acquire manufacturing technologies can significantly impact on their eventual capabilities and performance. This complete process has unfortunately received limited attention in previous studies. Therefore, the work presented in this paper has investigated leading research and industrial practices to create a formal and rational decision process, and then evaluated this through an extended and in‐depth case study of a manufacturing technology acquisition. An analysis of previous literature, industrial practices, and the resulting decision process are all presented in this paper.

A Product and Process Model of the Technology‐Sourcing Decision

The technology‐sourcing decision traditionally has examined the choice either to innovate internally or to acquire technology from outside sources. The increasing complexity of this decision requires a move beyond the simple “make‐versus‐buy” dichotomy. We seek to test factors that influence the technology decision of subsidiaries for product and process technology across the continuum of options from internal development to outsourcing. We also explore concordance between the research streams of new product development and technology sourcing.Regression models are used to analyze data from 187 subsidiaries that suggest product and process technology development decisions sometimes are associated with similar factors and at other times they diverge. In particular, we find that external product and process technology acquisition decisions are associated negatively with differentiation goals and associated positively with product dynamism. While external product acquisition is associated negatively with a low cost goal and positively with increasing distance between primary marketing and R&D operations, external process technology acquisition is associated positively with high competitive intensity.Implications include the following: (1) While external product technology acquisition may provide quicker or even less expensive initial solutions, external reliance makes it difficult to maintain a long‐term positional advantage; (2) When greater distances separate key functional activities, external partners may provide solutions that are more responsive to local consumer needs, and the potential for improved communication may allow for quicker adaptation and increased flexibility; (3) In highly dynamic product situations, internal development, while providing greater control, can be expensive and can result in technologies that are not accepted by the marketplace; and (4) As competitive intensity increases, strategic imperatives may reduce the focus on product design and development and may require increasing concentration on manufacturing costs and efficiencies.

The Timing of Medical Technology Acquisition: Strategic Decision Making in Turbulent Environments

Healthcare decision makers and researchers have long been interested in the factors behind medical technology acquisition. The rate of environmental change in recent years has dramatically affected technology acquisition decision making in acute care hospitals. This study examines the relative role of decision-maker influence and environmental factors on the timing of MRI acquisition in hospitals operating in three western states with different levels of environmental uncertainty. The results suggest that the relative influence of decision makers and environmental factors on innovation acquisition timing varies depending on environmental turbulence, and that hospitals acquire new technology as one way of controlling the turbulence in their environments.

Mixed Motives and Ethical Decisions in Business

Discerning the motives that lead businesspeople to make ethical decisions in economic contexts is important, for it aids the moral evaluation of such decisions. But conventional economic theory has for too long assumed an egoist model of motivation, to which many contrast an altruist view of ethical choices. The result is to see business decision making as implying dilemmas. On the other hand, we argue, if one assumes multiple motives, economic and ethical, in ordinary business decisions, a more fruitful model of ethical motivation in such decisions emerges. In this paper multiple motives are assumed to be the norm in a world of large organizations, complex decisions and stakeholder management. An example of a technology acquisition decision, with environmental overtones is presented in illustration of this approach. A method for discerning motives, primarily in terms of behavioural efficacy is presented. On this basis a two step approach to morally evaluating mixed motives in business decisions is proposed. First, the fit of motives with substantive ethical values should be ascertained, and then the efficacy of moral motives in yielding ethical behaviour and outcomes should be determined. This approach, we conclude, offers a much more concrete model of the actual role of moral motives in business decision making. It also signals the importance of moral learning in organizations.

Technology acquisition decision making revisited: lessons learned in an age of environmental uncertainty

High technology medical innovation remains implicated as one of the most significant driving forces behind the high costs of health care in the USA. In addition, health care organisations are faced with an increasingly complex and uncertain environment. How do these factors interrelate to affect decisions made to acquire high cost medical technology? Data was collected from hospitals in three states attempting to assess how environmental variables affect technology acquisition decision making. Among the important criteria are physician recruitment and retention and perceived competitive pressure. An analysis of the data reveals that technology is acquired as one means of reducing environmental uncertainty. Within a growing number of integrated health systems, collaboration acts to both control costs and reduce duplicative technology. In order for collaboration to be successful, a strong bond of trust must exist between decision makers in addition to any economic benefit derived from the union.

Capacity expansion with alternative technology choices

This paper considers the problem of determining the amount of capacity of a technology to be acquired to meet demand increments over time, when there are alternative technology choices. For example, different technologies may have varying levels of automation, with different fixed and variable costs of acquisition and usage. First, a mathematical programming formulation of the problem is presented and certain properties of the model are exploited to develop an efficient forward solution procedure. This procedure, which exploits duality, is then used to derive a number of planning horizon results. These results help in determining initial capacity and technology acquisition decisions, that are infinite horizon optimal, with less forecast information. Finally, the results of a computational study are presented. This study enables us to understand the impact of demand patterns, demand variance and, fixed and variable costs on: (i) type of technology and the amount of capacity of that technology acquired, and (ii) forecast horizon values.

A knowledge-based expert system for technology acquisition in small and medium scale manufacturing organizations

Abstract Consistent and reliable decision making for technology acquisition in small and medium scale manufacturing organizations is vitally important since these firms are the backbone of national economies, both in developed and developing countries. Because of their flexibility, small and medium scale firms are successful in adopting new technologies. However, a careful analysis should be conducted in technology acquisition decisions. Since these decisions require special type of knowledge and expertise, expert system, as an important tool of computerized decision making, can overcome these multidimensional difficulties. This paper proposes a knowledge-based approach making use of issues such as sales, processes, costs and general policies, in decision processes for technology acquisition by small and medium scale manufacturing organizations in the developing environments.

New imaging technology and cost containment.

New diagnostic imaging technologies have borne unusual scrutiny in considerations of health care cost containment. This scrutiny derives from a history of relatively poor technologic assessment, questions about the extent to which technologic innovations promulgate improvements in patients' health, and observations that economic concerns often take precedence over medical ones in technology acquisition decisions. Current and future legislative and market-driven health care reform initiatives will require providers thinking of acquiring new imaging technologies to assess their costs and benefits more rigorously.