Factors Affecting Technology Transfer

Technology transfer implies the movement of physical structure, knowledge, skills, organization, values, and capital from the site of generation to the receiving site ( Mittelman & Pasha, 1997 ). The invisible aspects of technology, such as knowledge, skills, and organization, might be much more critical than the physical aspects for the successful transfer of technology. The case of the “Green Revolution” in India shows that technology is a form of knowledge created by humans, and knowledge transfer occurs as the outcome of a set of learning experiences ( Parayil, 1992 ). This illustration implies that education and training play an important role in facilitating the movement of invisible aspects of technology. In other words, the capacity to assimilate, adapt, modify, and generate technology could be obtained through education and training.

The significance of education and training is also found in the cases of Japanese industrialization and Indonesian farm mechanization. In the early stage of Japanese industrialization, science and engineering universities and company schools contributed to facilitating the transfer of a marine steam turbine generator by providing capabilities for learning the new technology ( Matsumoto, 1999 ). The capability of Japanese companies, acquired through education, made it possible to actively seek out new technology for the purpose of gaining competitive advantages, despite the economic risks.

On the contrary, Indonesian farmers failed to transfer agricultural machines for farm mechanization because of the lack of education, training, and other political and compatibility issues ( Moon, 1998 ). Technology transfer should almost always involve modifications to suit new conditions. This implies that the unsuccessful transfer of agricultural machines in Indonesia resulted from the recipients’ lack of absorptive capacity to assimilate and modify it rather than the donors’ lack of sensitivity to local context for fitting the needs of end users. Technology is a passive resource whose effectiveness depends on humans. Consequently, one of the most critical components for effective technology transfer is a person’s ability to learn new technology, which can be gained through extended education.

Although education is regarded as a critical and necessary factor for facilitating the transfer of technology, it is not sole factor for successful technology transfer. Another important factor could be effective planning for facilitating that transfer of technology. The plan should include concrete ways that recipients and donors can collaborate during the technology transfer process. Collaboration might be based on willingness for technology transfer from both the recipient and the donor. Without a strong willingness for technology transfer on both sides, it is impossible to assimilate, adopt, and generate new technology.

In the international technology transfer context, most technology transfers are primarily guided by the profit motive. A donor country seems reluctant to transfer knowledge or capacity to a recipient country without the hope for profit. The article entitled “Technology Transfer: A Third World Perspective” provides a great implication about the issue. Third World countries embarked on a massive but passive importation of technology ( Akubue, 2002 ). Many recipient countries in the Third World adopted these innovations without modification. Akubue (2002) further notes that arrangements like this could be the result of a strategy of the donor countries aimed at making Third World countries continuously rely on them for maintaining the new technology. Through this strategy of technology transfer, the donor country might also gain an additional advantage over purchasing raw material, such as oil or gaining political influence in the recipient country, in addition to profiting from technology maintenance.

A critical test of technology transfers is whether they stimulate further innovations within the recipient country. Third World countries should be able to achieve technology transfer that stimulates further innovations through an elaborate plan. The plan should include the best ways to benefit both a recipient country and a donor country equally. This plan might prompt willingness of both the recipient and donor sides, which would result in strengthening collaboration for facilitating technology transfer.