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Technological Capability And Technology Management

Weiwei Wu, Tan Li, Bo Yu, Jiliang Wang

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Purpose – The purpose of this paper is to investigate the impacts of technological capability (TC) and technology management (TM) on the development of China’s telecommunications industry by examining two interrelated questions: Which is the order parameter for China’s telecommunications industry? and What are the relationships between TC and TM? The paper will develop models to analyze TC, TM and the development of China’s telecommunications industry quantitatively. Design/methodology/approach – The paper reviews literature related to TC and TM and investigates the technical features of China’s telecommunications industry. Then, the paper makes a theoretical analysis of the relationships among them. First, it analyzes the effects of TC and TM on the industry and tries to explore the order parameter. Second, the paper analyzes the interaction between TC and TM. Then, the paper applies the Haken model to construct an analysis model. It also constructs models for measuring TC and TM. Using the data of China’s telecommunications industry from 1991 to 2010, the paper identifies the order parameter for the industry and tests the relationships between TC and TM. Findings – The paper finds that TC plays a dominant role in the development of China’s telecommunications industry. The paper also finds that TC promotes the development of TM. However, TM fails to promote the development of TC. The paper presents two other important findings. The first one is that China’s telecommunications industry has constructed a positive feedback mechanism for continuous development of TC, which provides an impetus for industry upgrades and development. The second one is that there is no positive feedback growth mechanism for TM capability, which has increased the lag between TM and TC and has become one of the important reasons why TM does not promote TC. Research limitations/implications – Theoretical and managerial implications are put forward. Thus, TC must be improved to propel the development of China’s telecommunications industry; TM should be greatly improved and an effective growth mechanism for TM should be constructed; the synergy between TM and TC should be achieved. Research limitations are also pointed out. Thus, the results in this paper probably cannot be generalized to other industries; it does go on to discuss the synergetic mode of TM and TC that can best compel industrial development, and it does not explain what the growth mechanisms for TM and TC should be. Originality/value – The paper is original, as it provides new perspectives of TM and TC for analyzing industrial development, and it provides the method and model for quantitatively analyzing TC and TM at an industry level. It discovers the order parameter and new problems of China’s telecommunications industry, which no one has identified before. The paper also offers references for analyzing other industries from the perspectives of TM and TC.