Chapter 6: Mechanism of Technology Transfer and its

Effectiveness

"If we continue to develop our technology without wisdom or

prudence, our servant may prove to be our executioner." Omar

Bradley

Dairy development depends to a great extent on how successful knowledge is

generated and applied. Investment in knowledge, especially in the form of science and

technology has featured prominently and consistently in most strategies to promote

sustainable and equitable dairy development at national level. Although many of these

investments have been quite successful i.e. development of technology in dairy

(World Bank, 2006), the context for dairy is changing rapidly in the process of

technology knowledge management. It is increasingly recognized that value of

traditional dairy science and technology investment such as research, innovation and

extension, although necessary, is not adequate to enable dairy development.

Moreover, the changing needs and demands of end users i.e. farming community,

industry and other value added customer needs are not entirely met by technology

generated under national dairy development programme (Swaminathan, 2004).

The present chapter deals, in first section, with the conceptual issues around terms

such as technology and technology transfer from University. In second section, the

chapter identifies, from literature, major mechanism of technology transfers which are

used for transfer of technologies from research institutes and university. Further, an

attempt is made to identify the mechanisms of transfers of technologies employed by

CFTRI and NDRI? Additionally, the relative importance of the technology transfer

mechanisms for concerned Institute is assessed. It also identifies the factors that play

important role in technology transfer from the institutes to Users. The endeavour of

this chapter is to highlight the barriers to commercialisation of technology and find

the possible solutions through gaining a better understanding of technology transfer

professionals' perceptions about TT.

151

It is an accepted fact that modem dairy innovations emerge from the university

system such as CFTRI and NDRI, and are adopted by industry as a process referred to

as 'bench to bedside'. As government supported institutions, a need is felt to meet the

expectations of the public, through new technologies and new improved processes and

methods. The process through which these expectations are met is called 'technology

transfer'. These advancements are persistently correlated to economic progress and

social benefits of end users. Therefore, advancing technologies also form much of the

business of university scientific research. often, however, university research is not

easily, or even successfully, transferred to industry (Markham et al., 1999).

Though, new scientific discoveries have flourished in these institutions, it has been

argued that there is a lack of direction when it came to transferring these discoveries

to the market. Though, in recent past, in the new life sciences era that is marked by

the convergence of scientific disciplines such as computer sciences, engineering, life

sciences, mathematics and statistics, technology transfer becomes an interesting

challenge.

The 11th five year plan has also stressed on strengthening academic-industry interface

and public-private partnership effectiveness in dairy sector. The plan has setup

priorities such as movement of technologies from the laboratories to market place

through technology transfer and new venture creation, and enhancing mobility of

science and technology professionals. For the reason the government needs to extend

all benefits and conditions along sufficient funding for R&D institutes. Therefore, it

is expected that front runner public R&D institutes might need to establish early

linkages with industry in developing new technologies. This helps to prevent

developing unrealistic expectations about the market potential and the success of

technology transfer process. As an assumption, ifboth of them partner in developing a

technology, then there may be greater possibility for developing dairy technology

with having better socio-economic impact.

152

6.1 Conceptual issues

6.1.1 Technology

There are various definition of technology transfer adopted by different organisation

and institutions. In many instances, definitional controversies can be quickly resolved

by simply relying on dictionaries. Here in the chapter, this is not one of those

instances. Works on technology transfer generally focus on technology as an entity,

not a study and certainly not any specific applied science. The most common view of

technology is "a tool", and then discussions proceed as to just what type of tool

qualifies as technology (Bozeman, 2000). As Webster's dictionary offers just three

definitions of technology, none of which sets all definitional controversies to rest.

According to Merriam-Webster Online Dictionary the technology word originates

from Greek word technologia which means systematic treatment of an art,

(etymology: techne art, skill + -o- + -logia -logy). Therefore, technology is

1. A: the practical application of knowledge especially in a particular area:

engineering and medical technology; B: a capability given by the practical

application ofknowledge e.g. a car's fuel-saving technology

2. a manner of accomplishing a task especially using technical processes,

methods, or knowledge e. g. new technologies for information storage

3. the specialized aspects of a particular field of endeavour e.g. educational

technology

The technology is also defined as (a) the application of science, especially to

industrial or commercial objectives. (b) The scientific method and material used to

achieve a commercial or industrial objective (American Heritage Dictionary, 2006).

This definition is more inclusive then what it was in Webster's 1989.

Further, technology is considered as "the systematic knowledge for product

manufacture and service provision in industry, farming and commercial fields," and

knowledge is reflected in inventions, utility models, designs, and in data forms.

153

Knowledge is also shown in industrial plants, design, installation, operation, and

maintenance of equipment, management of industrial & commercial corporations, and

the technical skill & experience of experts for those activities. In this definition, it

must be noted that technology comes from knowledge. However, not all knowledge is

included. Therefore, fundamentally, a technology is an idea, practice, or object

resulting from research as well as a tool that embodies the technology (Mark Wang,

2003). Similarly, technology as a set of knowledge contained in technical ideas,

information or data; personal technical skills and expertise, and equipment,

prototypes, designs or computer codes Gee (1993). In addition, the technology refers

more to new tools, methodology, processes, and· products and as such, is primarily an

instrument used for changing the environment (Gopalkrishanan S., 2004).

This implies abandoning the preoccupation with technology as 'equipment' alone

(process and product development technologies). Instead, it require a schema which

acknowledges all those institutions, artefacts and arrangements within which the

adoption, configuration and use of those technologies takes place - including the

knowledge and expertise which have created technologies and are embedded within

them (Dosi, 1982), and the processes of learning and experience which inform

innovatory activity (Sahal, 1981 ). Technologies, therefore, are inclusive phenomena.

The 'technology' 'society' and 'insitutions' cannot be treated as entirely separate

categories in dairy sector. Their social settings shape technologies just as much as

vice versa: the mutual relationship among becomes more apparent (MacKenzie and

Wajcman, 1985; Edge, 1988, Bozeman, 2000, Jogerson,etal, 2009, ). It is therefore

clearly unhelpful to treat technologies and their social contexts as separate phenomena

in the way that traditional conceptions have tended to do; the definition of technology

itself must incorporate the social arrangements within which it emerges and becomes

embedded (Hill, 1981; Clark et al., 1988). Therefore, to create understanding about

technology and implications of technological transfer in dairy sector, this is often

named as the social shaping of technology (SST) approach, for technology foresight.

154

6.1.2 Technology transfer

Therefore, the technology sets up a relationship between man and material or nature

wherein man applies science for making use of naturally available and unavailable

resources to fulfil its biological, social, psychological, economical, political,

environmental, and spiritual needs. The man creates and develops such technologies

in laboratories, research institutes and universities. These technologies must be

transferred to appropriate application in right setting with suitable society and

consumers. When it comes to Transfer of Technology (TT) what does it mean? How

it is viewed and defined?

The definition of technology transfer differs substantially from one discipline to the

next (Zhao and Reisman, 1992). The economists prefer to define technology on the

basis of the properties of generic knowledge, focusing particularly on variables that

relate to production and design (Arrow, 1969; Johnson, 1970; Dosi, 1988). On the

other hand, sociologists tend to link technology transfer to innovation and to view

technology, including social technology, as "a design for instrumental action that

reduces the uncertainty of cause effect relationships involved in achieving a desired

outcome" (Rogers, 1962; Rogers and Shoemaker, 1971). Anthropologists tend to

view technology transfer broadly within the context of cultural change and the ways

in which technology affects change (Foster, 1962; Service, 1971; Merrill, 1972).

Technology transfer is the movement of new technology from its creator or researcher

to a user, especially as products or publications; also, the movement of new

technology from developed areas to less-developed areas. Further, technology transfer

is 1) assignment of technological intellectual property, developed and generated in

one place, to another through legal means such as technology licensing or franchising.

2) Process of converting scientific and technological advances into marketable goods

or services (Business dictionary, 2008). Technology transfer is the process of

developing practical applications for the results of scientific research. Technology

transfer includes, but is not limited to, the disclosure of results from research and

development, the licensing or assignment of intellectual property rights related to such

155

results, exchange of information, education and training, and joint ventures. The end

result, in meaningful terms, is the making available to a recipient of industrial and

agricultural processes and products and the relevant enabling technology for practical

realisation.

All the respondents from CFTRI and NDRI have responded with full agreement on

the definition of technology transfer presented to them for their response. The

presented definition of technology transfer supplemented with some additional views

by certain respondents. The most comprehensive definition of technology transfer

emerged through the study and followed in the thesis is as follows.

Technology transfer is

- Informal discussions of research results and techniques between individuals

supported by government funds (transferors) and individuals working in the

private or public sector (transferees)

- Formal dissemination of research results, for example, at conferences,

workshops

- Licensing of university and national laboratory patents to the private or public

sector

Cooperative or collaborative Research and Development (R&D) between a

university or laboratory and the private or public sector

A. Informal: work initiated out of mutual interest without generation of written

agreements

B. Formal: joint grants or agreements to perform collaborative work

- Startup of small company based on government funded research

- Technical assistance from transferors to the private or Public sector, farmers,

workers

I 56

- Innovations, Scaling up and commercialization.

Personnel exchange or loan (professor or student on visit or temporary

assignment to company or company technologist on visit or temporary

assignment to university)

- Private and Public-sector use of government funded facilities

- Formal exchange (written agreement, e.g., consultant) of non-patented

intellectual property--techniques, skills, the "art" of the practice, food

compositions, ingredients etc.

Technology transfer is crucial for the innovation that drives a healthy economy, the

development of new technologies for humanitarian and public benefit, and to generate

revenues to support the university's core teaching mission (Humboldt State

University, 2007). The purpose of technology transfer is to make the results of its

research available for public use and benefit by enabling inventions to be developed

into useful products in the commercial marketplace; disseminate new and useful

knowledge resulting from University research through the use of the patent system;

raise revenue to support research and education; offer meaningful incentives to spur

research, invention, and the entrepreneurial-spirit. The technology can be transferred

horizontally and vertically as evidence suggests.

Horizontal and Vertical Technology Transfer

A difference is commonly made between vertical and horizontal transfer. Horizontal

transfer refers to an established technology being transferred from one operational

environment to another. The technology is already commercialised and the intention

is to disseminate the technology and broaden its application into other contexts. This

type of transfer is used by companies wishing to maximise the return from their

technology, but being unable to do this by direct selling of end products in a market.

Horizontal transfer is more common when technology is being transferred from

industrialised to developing countries (Wang, Metal, 2003).

157

Vertical transfer refers to technology being transferred from research to development

to production. Therefore it follows the progressive stages of invention, innovation and

development, with the technology becoming more commercialised as it proceeds

through each stage. Vertical transfer can be within one organisation or a transaction

between, say, a research institute and a manufacturing company.

The research institutes, CFTRI and NDRI, in India follow the vertical transfer path of

technology transfer. The vertical technology transfer follows certain TT mechanisms.

The chapter further focuses on study of mechanisms of technology transfers applied

by the CFTRI and NDRI to transfer technologies developed by them. Thus,

technology transfer occurs in many ways-through the simple spoken word, through

the physical transfer of a tangible product of research or through the relative

complexity of an intellectual property licensing program.

6.2 Mechanisms of Transfer of Technologies

University-Industry technology transfer can occur in many different forms (Ups till &

Symington, 2002), such as, through the publication of research results in scientific

journals, books and articles, through industry sponsored research, through strategic

research partnerships between universities and industries, licensing, new start ups or

spin offs, consultancy etc. Some of the views (Parker & Zilberman, 1993; Parker et

al., 1998; Thursby et al., 2001) underscore, the transfer of technology from a

university setting to industry or farmers or users is not discrete event, rather

encompasses of a number of distinct stages. Even as the policies and procedures

governing the university-industry/users technology transfer differ from one university

to another, the basic processes seem to be quite similar (Rogers et al., 2000; Graff et

al., 2002; Friedman & Silberman, 2003; Kumar U et al, 2006).

There are different mechanisms of transfer of technology from University to users and

industry. In US Universities certain TT mechanism preferred such as the graduated

Student, Publications and presentations, informal & collegial networking, sponsored

158

research-Government & Industry, Faculty consulting, and Sharing of Biological

materials (Young, 2000).

6.2.1 Major TT Mechanisms

The literature on technology transfer from University or publically funded research

institutes to users such as industry, fanners and other stakeholders have identified a

range of mechanism of technology transfer (Abramson, 1999; Young T, 2000; Lee J

and Win H N, 2004). Therefore, different mechanisms are identified for technology

transfer between university research centres and industry as under mentioned.

6.2.1.1 Collegial interchange, conference, publication

It is informal and free exchange of information among colleagues, which includes

presentation at professional and technical conferences and publication in professional

magazines. It is widely used and the first step of linkage between academic institutes,

their research centres and industry.

6.2.1.2 Consultancy and technical services provision

One or more parties from the university or research centre provide advice,

information or technical services. They have formal written contract, generally short

term and specific. Faculty members or senior researchers can be hired to consult

during the time they are allowed to work outside (OECD, 1990). It can be of different

forms such as advisory committee, informal grouping of companies, university centre

or industrial liaison units, and management foundation.

Advisory committee consists of faculty members and practitioners to examine

curriculum in detail, to help place students in jobs, to assist witfi faculty development

and to provide some kind of feedback for evaluation (UN, 1974). Informal grouping

of companies are identified where member companies can involve more closely with

the university. Further, University center or industrial liaison units are usually

established to encourage more linkages between the academia and industry. Finally,

the management foundation expresses the commitment and the involvement of

practitioners in the task of improving the quality of management.

159

6.2.1.3 Exchange program

A transfer of personnel can be used to exchange expertise and information either from

industry to laboratory or from laboratory to industry. In this mechanism, conflicts of

each party's interest must be avoided and laboratory must approve of the lab

personnel consulting arrangements.

6.2.1.4 Joint venture of R&D and joint research projects

A contract or agreement is drawn between university/publically funded research

institute and a contractor in which costs associated with the work are shared according

to conditions as specified in the contract. The two or more than two partners can work

together from the stage of R&D to commercialization. It must be of mutual benefit to

industry and the research institutes or University, and commercially valuable data

may be protected for a limited period of time. It provides some assurance that the best

brain in the business will be brought together to bear on the problem, and that there

will be a balance between long term, high risk research and short-term work which

can be promptly commercialized (Moses, 1985). Joint venture and joint project have

higher probability of successful technology transfer. It can be said that the ideal

transfer mode/mechanism seems to be the joint projects among the University or

research institutes and industry to compliment each organization facilities and

expertise. With the knowledge and experience gained from these projects, the

research institutes can improve their capabilities and help the local firms through

licensing and contract research programs and ultimately the joint projects with them.

This TT mechanism encourages to industry and university use it for reducing the risk

(Lee J and Win H N, 2004).

6.2.1.5 Cooperative R&D agreement

This is an agreement between one or more university research laboratories and one or

more firms under which the university side provides personnel, facilities, or other

resources with or without reimbursement. The industrial parties provide funds,

personnel, services, facilities, equipment, and other resources to conduct specific

research or development efforts that are consistent with the university or laboratory's

160

mission (Lee J and Win H N, 2004). American modal of university-industry

cooperative research centres program, which is co-funded by National Science

Foundation and a group of industrial enterprises through grants. This is a remarkable

mechanism of technology transfer. In contrast, Germany and some other European

countries do not have such appealing mechanisms. Consequently, the US model of

industrial grants to the universities encourages creativity in research and technology

transfer (Abramson, 1999).

6.2.1.6 Licensing

Licensing is the transfer of less-than-ownership rights in intellectual property to a

third party, to permit the third party to use intellectual property. It can be exclusive or

non-exclusive and is preferred by small business. The industry as a potential licensee

must present plans to commercialize the invention. Therefore, it is a kind of contract

between university and company. It includes terms for commercial exploration on

University owned technology.

6.2.1.7 Contract research

It is a contract between a research centre and a firm for contract R&D to be performed

by the research centre. Industry usually provides funds on the other hand the

university provides brains with the time frame ranging from a few months to years

(NEDC, 1989). Through contract research, the industry wants to utilize the unique

capability of the research centres that works for commercial benefit.

6.2.1.8 Science Park, Research Park, Technology Park or incubators

These are installations on a given site area, normally close to a university which

collaborate with a member of high-tech firms that receive official assistance in the

early stage (Quintas et al., 1992). The main fund providers would be the participating

commercial firms and the researchers include both from the university research

centres and the industry. This is a kind of form especially adopted by the high-tech

firms.

161

6.2.1.9 Training

Technology transfer through training could be in the form of practical training

wherein students are exposed to the working methods and requirements of jobs at

industry or at the institutions. The capability of staff in the particular field is improved

by further training. Special training is also useful where potential managers are given

lectures on administrative issues and the employees are trained for adoption of a new

technology (Gander, 1987). Many university research centres have training programs

to transfer the research results. It is also a way of reducing risk for the research

centres. It sometimes accompanies the licensing or contract research projects.

6.2.1.10 New start-up or spinoffs

Technology transfer takes place through the creation of university spinoffs (USOs),

where spinoffs (SO) means a new firm created to exploit commercially some

knowledge, technology or research results developed within a university.

6.2.1.11 Extension programmes

The essence of agricultural extension is to facilitate interplay and nurture synergies

within a total information system involving agricultural research, agricultural

education and a vast complex of information-providing businesses. Therefore

extension is a series of embedded communicative interventions that are meant, among

others, to develop and/or induce innovations which supposedly help to resolve

(usually multi-actor) problematic situations. Universities and publically funded

institutes are engaged in transfer of technology through extension in dairy sector in

India. The roots of the extension education originate in US Land Grant Pattern of

Education where state universities have tbe full responsibility for extension education.

The technology channelled from university through extension agents, as a group, who

were first publically funded technology transfer agents in US. The pattern of

integrated functioning of education, research and extension was introduced in India in

1960 when the establishment of agricultural universities was launched on the model

ofthe USA (Nath, NCB and Mishra L, 1992).

162

6.2.1.12 Technology donations

It is the process of offering technology as a charity or gift and providing grant or

giving for a cause to any organisation, farmers or group of farmers, industry, institute

and country.

Technology transfer is highly industry and technology specific. The preferred

mechanisms of technology transfer vary depending on the characteristics of the

technology being transferred, the industry involved, and the rate of technological

change affecting the industry at a time. For example, patent licensing is a critical

instrument of technology transfer in sectors where time to commercialisation is longer

(e.g., Biotechnology). However, patent licensing is relatively I~ss important in

microelectronics where current technology life cycle is short (Abramson, 1999).

Research publications, conferences, and movement of research personnel from

academic institutions and university to industrial research institutes and organisation

are important technology transfer mechanisms in biotechnology (Food, Agriculture,

Dairy) industry.

6.3 Mechanisms of technology transfer in CFTRI and NDRI

The separate surveys from each institute have revealed that the CFTRI has been

transferring technology through using following mechanisms to industry, institutions

and other users.

• Technical assistance from transferor to the private/public sector

• New Start-up ventures based on government funded research

• Extension programmes

• Formal exchange (written agreement) of non-patented intellectual property­

techniques, skills, the 'art' of the practice, food compositions and ingredients.

163

• Cooperative and/or collaborative R&D between institute and the private/public

sector firms. In informal process the work is initiated out of mutual interest

without written agreements

• Formal dissemination of research results (e.g., conferences, semmars,

publications, trainings)

• Licensing of institute patents to the private or public sector

• Informal discussions and sharing .of research results and/or techniques with

transferees

• Sponsored Research projects

• Consultancy services and projects

Certain TTM such as science park, research park, technology park or incubators,

technology donations, and use of government funded facilities by Private-sector are

never adopted by CFTRI. Technology parks and incubator are proved to be good

mechanisms of technology transfer in literature on technology transfer from research

institute. In addition, a TTM like Personnel exchange or loan (researcher or faculty or

student on visit or temporary assignment to company or company technologist on visit

or temporary assignment to institute university}, which could have enhanced the

commercialisation of technology, is not applied.

The survey results suggest that NDRI has adhered to following TT mechanisms for

transferring technologies to users.

Formal dissemination of research results (e.g., conferences, semmars,

publications, trainings)

Extension Programs

164

- Formal exchange (written agreement, e.g., consultant) of non patented

intellectual property-- techniques, skills, the "art" of the practice, food

compositions and ingredients, etc

- Licensing of institute patents to the private or public sector

- Technical assistance from transferors to the private/public sector

- Science park, research park, technology park or incubators

- Cooperative and/or collaborative R&D between your institute and the

private/public sector firms: Formal: joint grants or agreements to perform

collaborative work

- New Startup venture based on government funded research.

The formal dissemination of results through training, extension programs, consultancy

and licensing are the most prominent among all mechanisms of TT. Agriculture

Technology Information Center (ATIC) has been developed which works as a single

window disposal system for all queries from farmers regarding scientific dairy

farming and milk processing. The institute follows the Customers approach in

Consultancy Cell as per their requirement. On the other hand, technical assistance to

public or private sector, incubators, and cooperative or collaborative research are the

sparingly used mechanism of TT in NDRI. However, there are certain mechanisms of

TT which are not in use by the institute, as following.

- Informal discussions and sharing of research results and/or techniques with

transferees

- Technology Donations

Cooperative and/or collaborative R&D between institute and the

private/public sector firms: Informal: work initiated out of mutual interest

without written agreements

165

Private-sector uses government funded facilities

Personnel exchange or loan (researcher or faculty or student on visit or

temporary assignment to company or company technologist on visit or

temporary assignment to institute university)

The mechanisms of TT are institute specific, as interviews and survey results suggest,

which have their origin in institutional structure, mandate, objective, area of research,

controlling rules and laws on TT, institutional culture, leadership in the institute,

attitude of scientists and researchers, opportunity for involvement of technology

developer and transferrer, firm's behaviour towards institute and it's technology,

available expertise on TT with institute, IPR policy, structure ofTTO, overall national

science and technology policy and available funding. The TT mechanism also

depends on interactions and communication between research institutes and

technology consumers. Technology transfer has good scope when both parties have

mutual beneficial situation. The TT is symbol of benefits to the parties engaged in

interaction, but after all it depends on effectiveness of TTM.

6.4 Effectiveness of Mechanisms of technology transfer

So far it is established that CFTRI and NDRI engaged in applying different TT

mechanism, which are mutually beneficial to institute and industry. When one turns to

study the relative effectiveness of various TTM then there is direct relationship of

effectiveness of mechanisms of TT with university, types of technology, nature of

sector, country, IPR and legal system, science and technology policies, and perception

of industry. According toM. Dalziel (1994), based on studies he has conducted, the

least effective (in order of descending effectiveness) TT mechanisms in universities in

Canada are university research chairs, licensing, seminars and workshops, "member"

company programs, and newsletters. Industry respondents consider licensing the

single least effective technology transfer mechanism. On the other hand, the most

effective mechanisms (in order of descending effectiveness) for TT are collaborative

research, university sabbaticals in industry, contract research, and industry visits to

166

universities, consulting, student projects and work terms in industry. Therefore, what

is the relative effectiveness of TTM in CFTRI and NDRI, based on analysis of survey

results?

6.4.1 CFTRI

The results of the study have reflected clear the effectiveness of the TTM on a scale of

5 relative ranks. The scientists, technologists and managers who are involved in

inventions, innovations, technology development, technology transfer and

commercialisation in CFTRI consider consultancy and technical services, contract

research and licensing most effective or excellent mechanisms of technology transfer.

These, three, methods are ranked on five scale, as results are shown in table 6.1.

Out of the twelve mechanisms presented to respondents from CFTRI, three are the

least effective mechanisms of TT (in CFTRI), which are, in descending orders,

university/institute research chairs, science parks, research parks, technology parks or

incubators, and technology donations. However, three TT mechanisms, such as

Contract research, Licensing, and Consultancy and technical services, are most

effective and excellent mechanisms, as supported by 100% respondents. They are

ranked most effective with weighted average 5 on effectiveness scale of 5. In

addition, collaborative research is also highly effective TTM with weighted average

4.67 on scale of 5. The remaining, mechanisms of TT, in descending order of

effectiveness, are Training, Extension Programs, Seminars, Workshops, Conferences

and Publication, Students Projects and Work Terms in Industry, and Exchange

program. The reasons and factors responsible for this relative effectiveness are

discussed later in section 6.5.

167

Table 6. I: Effectiveness of Technology transfer mechanisms in CFTRI

Ranked average summary Weighted Average Opinion/views

Consultancy and Technical Services 5.00 Excellent 100%

Contract research 5.00 Excellent 100%

Licensing 5.00 Excellent I 00%

Collaborative/] oint Research 4.67 Excellent 66.7%

Training 3.67 Good 66.7%

Extension Programs 3.33 Very good 66.7%

Seminars, Workshops, Conferences 3.00 Very good 33.3%

and Publication Good 33.3%

Fair 33.3%

Students Projects and Work Terms 2.67 Fair 66.7%

in Industry Excellent 33.3%

Exchange program 2.67 Very good 33.3%

Good 33.3%

Fair 33.3%

University/Institute Research Chairs 2.50 Good 50%

Fair 50%

Science park, research park, 2.00 Fair 100%

technology park or incubators

Technology Donations 1.50 Poor 50%

Fair 50%

Source: Survey analys1s by the author

Majority of the respondents are of the view that the student projects and work terms in

industry and university/institute research chairs are good TTM with weighted average

2.67 and 2.50 respectively. On other hand, I 00% respondents consider Science parks,

168

technology parks or incubators as fair mechanisms. The extension programs,

workshops, seminars, and publications are good TTM.

The evidence shows that the experience and area of expertise influences the views

about effectiveness of the mechanisms of technology transfer from the institute. The

respondents, who are scientists and working in TTO, view the exchange program,

extension programs, students projects and work terms in industry as very good

mechanisms for successful technology transfer. Whereas, management background

experts, who are involved in TT process and office, consider extension programs and

students projects and work terms in industry as not very good but fair mechanisms.

Further, exchange program perceived as poor technology transfer mechanism. The

CFTRI has less focus on dairy farmers. Therefore, it does not apply extensively the

extension program as TTM for transferring technology developed by its scientists. In

spite of that technology transfer office finds this mechanism very good mechanism of

technology transfer in the institute as opined by respondents.

6.4.2 NDRI

The same set of 12 TT mechanisms were presented to a sample of respondents which

was consist of scientists, business consultancy board members, administrators and

researchers from NDRI. The result revealed that the institute has not used some of the

TTM at all; the results are shown in table 6.2.

The most effective TT mechanisms among all for the NDRI are Collaborative/Joint

Research, Consultancy and Technical Services, Students Projects and Work Terms in

Industry, and Seminars, Workshops, Conferences and Publication. These four

mechanisms of TT are very good for successfully transferring the technologies to

industry and other users. However, out of the four, one TTM, collaborative or joint

research proved as excellent mechanism for NDRI with weighted average of 4.33 on

effectiveness scale of 5.

169

Table 6.2: Effectiveness ofTechnology transfer mechanisms in NDRI

Ranked average summary Weighted Average Opinion/views

Collaborative/Joint Research 4.33 Excellent 66.7%

Good 33.3%

Consultancy and Technical Services 3.67 Very good 66.7%

Students Projects and Work Terms 3.50 Good 50%

in Industry Very good 50%

Seminars, Workshops, Conferences 3.33 Very good 66.7%

and Publication

Science park, research park, 3.00 Very good 50%

technology park or incubators Fair 50%

Contract research 3.00 Fair 66.7%

Excellent 33.3%

University/Institute Research Chairs 3.00 Fair 50%

Training 2.67 Good66.7%

Fair 33.3%

Licensing 2.67 Very good 33.3%

Good 33.3%

Poor33.3%

Exchange program 2.67 Fair 66.7%

Very good 33.3%

Extension Programs 2.33 Fair 66.7%

Good 33.3%

Technology Donations 1.00 Poor 100%

Source: Survey analysis by the Author

Whereas other three out of four most effective TI mechanisms have effective

weighted average in range of 3.33 to 3.67 on effectiveness scale of 5. This view is

expressed by more than 66% of the respondents.

170

Similar to the case of CFTRI, the technology donation is a poor mechanism for TT.

This result emerged as a consensus view ofthe entire respondent from NDRI.

Extension Programs is a mechanism to transfer knowhow and knowledge to farmers

that is proved as a fair TT mechanism as believed by majority views. On the other,

minority 33.3% believe that it is good TTM with weighted average 2.33 on

effectiveness scale of 5. However, this has been second weakest TT mechanism

among all the twelve. In addition, exchange programme too considered as fair by

majority views with weighted average of effectiveness, 2.67.

The TT mechanisms such as Science Park, Research Park, Technology Park or

Incubators and Contract research have good effectiveness with weighted average of 3

on scale of 5. University/Institute Research Chairs is found to be fair mechanism

whereas remaining Training and Licensing are ranked as good mechanisms with

average effectiveness of 2.67. However, the licensing has not been very effective

mechanisms of technology transfer in NDRI, in contrast to CFTRI, as evidence

suggest.

The analysis of the survey results suggests that both institutes have been applying

different TTM at different preferences level according to their convenience and

available expertise. The certain TIM are not much successful and effective in both

the institutes-CFTRI & NDRI because of certain factors which are critical in

successful technology transfer. Further, the factors, which are important for effective

TT and commercialisation, as evident in literature and survey results, are discussed

hereafter.

6.5 Factors for successful Technology Transfer/Commercialisation

Technology commercialisation, in the context of the chapter, refers to the process

whereby inventions or IP from academic research is licensed or conveyed through use

of rights to a "for profit entity" and eventually commercialized (Friedman &

Silberman, 2003). The Successful commercialization requires significantly more than

a good idea or new technology. Developing a successful product requires, among

171

other things, effective management, strategy, timing, and marketing. In addition,

Coordinating among many organizations, some with widely varying missions, is a

significant challenge (Wang et al, 2003). Many countries in the world are embarking

on university reforms with a vision to augment the commercialization of the results of

publicly funded research (Slaughter and Leslie, 1997; Lehrer and Asakawa, 2004a;

Zhao, 2004) as India too a case. For example, many discoveries and inventions from

Australian universities have been lost offshore because they were not transferred

effectively to Australian industry (Zhao F, 2004). Policy makers are introducing these

reforms both through changes in the academic system and instruments for research

funding (Slaughter and Leslie, 1997; Benner and Sandstrom, 2000), as well as by

setting up structures to support such activities (Mian, 1997; Guston, 1999; Jacob and

Hellstrom , 2003). Policies are induced both top-down from the government and its

agencies, while other initiatives are emerging bottom-up from individuals and entities

inside the universities (Goldfarb and Henrekson, 2002).

For instance, the university systems in both Gennany and Japan have traditionally

been divorced from commercial interests and, indeed, relatively divorced from other

sectors of society (Lehrer M, 2004b ). It is argued, based on evidences that the success

of commercialization depends largely on general economic conditions and a culture of

innovation. The university affiliated incubators and university venture capital funds

are insignificant as far as their influence on the university technology

commercialisation process is concerned (Kumar U et al 2006). In the study of the

success of Stanford University in technology commercialization, Fisher (1998), points

out that success in university technology commercialisation is not solely dependent

upon the availability of funds or the university policies and strategies, but also on the

university's surrounding community's entrepreneurial climate and its own inherent

fertility. It is found that the two issues are significant to enhance the technology

commercialisation in Australian universities. The first is adequate financial support

from governments, industry and other stakeholders. The second is effective

innovation management with academic entrepreneurship. Academic entrepreneurship

means that academia takes the role of entrepreneurs to accelerate the generation,

172

dissemination and application of innovative ideas. Academic entrepreneurship is a

necessary practice and principle to tum scientific breakthroughs and technological

achievements into industrial and commercial successes (Zhao F, 2004). Further,

Flannery et al (2006) have added that university/business collaboration, general

university business practices, organisational characteristics, resource networks,

innovation speed, and technology selectivity and support processes are the key factor

in commercialisation efforts in universities.

There are certain factor identified as crucial during the interviews with scientists&

technology transfer officials and survey of literature for successful commercialisation

of technology. In addition, the major factors which affect to successful Technology

commercialisation (TC) in both the institutes-NDRI and CFTRI, are deliberated

henceforth.

6.5.1 Institutes-Industry Partnership

Public-private partnership and industry involvement is particularly important with

regard to applied R&D, wherein there has to be a focus on reaching the outputs and

technologies developed to the marketplace in India (Strengthening academic industry

interface working group report, 11th Five year plan, 2006). Strong incentives for

industry-university research collaborations resulted m successful product

development and technology transfer (Young, 2000). An increasing number of

strategic partnerships/relationships, as a factor, with industry have firmly placed the

universities or publically funded Institutes at the centre of commercial technology

development and transfer (Siegel et al., 2003)

The partnership between industry and R&D institutes is significant for successful

commercialisation of developed Technology and determining about kind of

technologies required by users. Public R&D institutes have to establish early linkages

with industry in developing new technologies in order to prevent from emergence of

unrealistic expectations about the market potential and the success of technology

transfer process. Ifboth of the partners are involved in developing the technology then

there is a greater possibility for developing the technology which is having good

173

commercial impact (Katz and Martin, 1997). In India, technology development in

public R&D institutes is pursued for its inherent scientific value and is investigator

driven. Its research mainly focuses on long-term radical innovation processes.

Commercial success and market needs have traditionally been of little concern

(Mohan R S and Rao R A, 2005).

The three models, as suggested in literature, of interaction of R&D institutes and

industry are Classical, Market, and Partnership Model, as presented in table 6.3. The

model for successful commercialisation and efficient technology transfer can be

arrange in ascending order of their successful results as Classical, Market and

Partnership Modal.

Table 6.3: Classification of institute-industry interaction

Model Vision Strategy Management Relationship

Industry

Classic acquires Technology Researcher defines Researcher

model developed push research lines

technology

Planned

Market needs Researcher. programme was Market

guide Market pull Gets feedback established model

research from industry knowing market

requirements

Balance

between Partnership

Strategic industry needs Both partners Symbiotic model

and market

needs

Source: Mohan R S and Rao R A, 2005.

174

The publically funded research institutes- CFTRI and NDRl have a different kind of

partnership with industry for development and transfer of technology.

NDRI often follows the classical model of interaction with industry where Industry

tries to get access to know how and technology in non-partnership mode without

paying any cost to such knowledge or technology. The technology development

projects and research plans are devised and undertaken by researchers without

comprehensive involvement of the industry. Researchers define the research line and

do not strive for or expect any feedback from industry or marketplace. However, the

consultancy board at NDRl has been involved in consultancy and it gets feedback

only from those who come for service to the institute. NDRl has been involved in

'technology push' strategy for partnership between institute and industry. Evidence.

and response from experts and researchers suggest that it has affected the capability of

NDRI to transfer the technologies it has developed.

CFTRI usually follows a mix strategy of interaction with the industry to sell its

technologies developed by the scientists without much involvement of industry in

planning and managing the technology projects. Scientists do not have any visiting

postings in the industry; therefore, they do not have any direct face to face experience.

But CFTRI has more professional approach making any kind of interaction with

industry only through technology transfer and business development department.

6.5.2 Stake Holder Involvement

The stakeholders of technology have varied role in transfer (commercialisation) of

technology from University to users. The technology transfer process typically

involves a variety of players, from transferors who create the technology and prove

the concept, to those who embed the technology in a useful product, service, tool, or

practice, and finally to transferees, who embrace it, further develop it, commercialize

it, and ultimately use it.

The Ama Drum project clearly shows that many factors affect whether a new

technology is accepted and used, not just the technology itself. Selecting a partner

175

with the right capacity and training is crucial. So is involving the right local

stakeholders from the start. These should include a local government structure or non­

government organisation that knows the social dynamics and that can help make the

technology sustainable (Khungeka, N, 2009).

The evidences suggest that stake holder involvement is not at encouraging level in

both the institutes-NDRI and CFTRI, on all issue related to technology needs

assessment, technological planning, technological development, prototype

development, and product development. The low level of participation of the industry

in research and development in partnership with the researcher from the concerned

institute has resulted in a gap in technological needs of the industry and supply

capability of the institutes. Therefore, the argument that level of stakeholder

involvement with the R&D institutes funded by the government has a significant

impact on level of commercialisation of technology is approved.

6.5.3 Technology transfer office (TTO)

The TTO is a major factor in successful technology commercialisation from research

institutes or universities. The TTO is established to reward, recruit and retain

faculties, to facilitate closure ties with industry, to promote economic growth, to

commercialise the research for public good- the product that may not otherwise exist,

and in the process, generate resources for additional research and education (Hsu &

Bernstein, 1997; Rogers et al., 2000; Allan, 2001).

The establishment of more than 200 technology licensing offices in US universities

have been factors for successful technology transfer and presently every major

research university in US has a TTO (Rogers et al, 2000; Allan, 2001 ). In the UK,

technology transfer has attained success through making availability of early stage

(seed com) funding and financing of university technology transfer staff staff in some

UK university technology transfer offices. Besides this, other aspects such as the

structure of TTOs, management and skill of the employees of the TTO are important

for commercialising the technologies. (Deeter M et al 2007).

176

Indian university system does not have their own TTO and trained skilled manpower

that can make successful to technology commercialisation from concerned institutes

or universities, as the evidence suggest. For instance, URDIP's Patestate is the

window into CSIR for access to its technology and skills. The Patestate team works

with the CFTRI and other CSIR laboratories to develop technology development

contracts, licenses or sell these intellectual assets. Patestate team assists in finding

best commercial use of the technology, in selecting potential customers and

negotiating agreements.

Where as, in case of NDRI, consultancy servtces board has been established in

pursuance of the technology policy of Govt. of India. The policy lays stress on the

development of indigenous technologies and their effective transfer to industry. The

Board facilitates transfer of technologies developed the researchers and scientists in

NDRI. The institute has signed a memorandum of understanding (MOU) with

national research development corporation (NRDC) for patenting and

commercialisation of its technologies.

Further, as evidences suggest that the TTO or consultancy board have crucial role in

commercialisation of technologies. Lack of strong TTO in NDRI affects the level of

technology commercialisation. There is strong view among researchers that NDRI

should develop this office with best talent in technology transfer, commercialisation

and technology management.

On the other hand, CFTRI has a Technology Transfer and Business Development

Department (TTBD) headed by a management background person. It consists of other

scientists who deal with different aspects. TTBD is proved to be strong factor in all

the technologies commercialised in recent time by the CFTRI. TTBD help the

technology developers to shape the technology for the market needs. It communicates

all needs and concerns of the food industry and available technologies for

commercialisation with institute to respective enteritis. Therefore, TTO ts very

important factor for commercialising technologies from the R&D institutes.

177

6.5.4 Sharing of Royalty

The sharing of royalty with creator of technology has been a maJor factor for

successful technology transfer world over. It is argued here that sharing of royalty

with creator in research institute is a factor in commercialisation of technology. Under

the provision of the Bayh-Dole act, a percentage of royalty income must be shared

with the investor(s). Each university can set its own royalty sharing arrangements. At

Stanford, after 15% is set aside for the operations of the licensing office and for

certain programmes, the balance is shared 1!3rd with inventor(s), l/3rd with inventor(s)

department, and 1/3rd with the inventor(s) school. There is no upper limit on the

amount shared with Stanford inventor(s), and a few have received millions of dollars

from licensing of their inventions. Some universities have the percentage given to the

inventor(s) change as the total amount reaches certain levels, or may set at threshold

amount after which no payments are made to the inventor(s).

The government of India has taken initiative, after realising necessity of royalty

sharing, to bring out a law on intellectual property generated out of publically funding

and publically funded research universities and institutes. The government has

prepared a bill to introduce in Rajya sabha, named as "the protection and utilisation of

public funded intellectual property bill, 2008". A bill to provide for the protection and

utilisation of intellectual property originating from public funded research and for

matters connected therewith or incidental thereto. The proposed bill has the provision

under section 11 subsections! for sharing the income or royalty arising out of

publically funded intellectual property as, not less then thirty per cent (30%) of

income or royalties, after deducting the expenses incurred in protection and utilisation

such intellectual property, shall be given to the creator21 of intellectual property.

The provision for sharing of income, with creator, generated out of licensing the

technology will help in enhanced level of technology transfer in India. When such law

was formulated in US the critique of the law had argued against it and its objective.

21 "Intellectual property creator" means the person employed or engaged by the recipient for research and development and who created the public funded intellectual property.

178

However, the law has been proved highly successful in US. At present the existing

gap in sharing of royalty provision in India will be filled by the protection and

utilisation of public funded intellectual property bill, 2008.

In India it has been realised this fact that sharing of royalty certainly affects the

commercialisation of the technology. The survey on NDRI and CFTRI, specifically

pointed out that sharing of royalty or license fee with the intellectual property or

technology creator affect the TT. Presently, both the institutes do not have a clear

formula, as in US universities, for sharing such royalty with faculties or researchers.

Therefore, majority of scientists, who are researchers and involved some point of time

in research, have responded that provision of sharing of such royalty with creators

could enhance technology transfer. Whereas, the management background

individuals, who are not involved directly in research, are of the opposite view.

6.5.5 University top management and academia

The top management and academia along with culture of the university determines the

level of commercialisation of technology. The knowledge and skills of Academia

have key role to foster a supportive structure to commercialize innovative research. It

is further determined by the required commitment from the top management of

universities, the alignment of a university's strategic plan with research

commercialization, the enhancement of an entrepreneurial culture in universities, and

reform in reward systems in universities (Zhao F., 2004). The culture within Indian

universities for commercialization has not developed to a level that is necessary to

stimulate and facilitate increased transfer of knowledge to business and society.

The evidence suggests that culture of the institute and top management affect the

technology commercialisation in both the institutes-CFTRI and NDRI. The CFTRI

proved to be more professional in approach for technology transfer or interaction

between industry and scientists or TTBD. There, in CFTRI, all information is

considered important as an intellectual property whereas in NDRI the industry gets

information as well as knowhow on resolving certain technology related problem

through personalised relationship. There is a culture of personalised relationship and

179

old students' affiliation or closeness to scientists and faculties, to get access to

technologies and information, which is crucial for problem solving, in NDRI. This

culture affects negatively to create importance of institute and consequently, institute

is taken as granted. Therefore, the industry is not ready to pay the cost of the

technology when it gets some important inputs in informal ways rather in business

professionalism.

6.5.6 Policy and Regulatory Scenario/Environment

The regulatory system is significant for technology transfer. The policy regimes for

technology transfer got stimulus with the legislation of US Bayh-Dole Act of 1980. It

entitles to inventions, made with US Gov't funding, by Universities to those inventing

entities (University/Institutes). Linear model of technology transfer confirmed

through the new law, as shown in figure below.

Figure 6.1: Linear Model of Technology Transfer

I .. Intellectual Research Disclosure ..

Asset 'I .,

Development

"" ,..

Intellectual 4..,_ Commercia liz

""' Property ation

censes & start ups i...--- Strategy , Protection Li

Source; Louis P. Berneman, 2000

University policies revised to assert ownership in all faculty inventions. In contrast, in

the UK, university to business technology transfer has only recently been the focus of

The Bayh- Dole act has significantly contributed in the university patenting and

licensing activity during, it essentially clarified the nature of the processes that need to

be in place to bring university technology into the marketplace (Kumar U. et al,

180

2006). It fostered the TTOs, hence realise the objective of Technology Transfer

(Rogers et al., 2000; Allan, 2001 ). On other hand, Bayh-Dole act may actually have

had a negative influence on the academic researchers' commitment to open science by

making them hold back their results (Mowery & Sampat 2005), but there is emerging

consensus on its remarkable results of the US act.

It is suggest by certain views that 1) while the Bayh-Dole act may have influenced the

propensity to patent; it has not resulted in any fundamental shifts in the underlying

generation of commercially significant inventions in the universities (Henderson et al,

1998). 2) Impressive rise in patenting post Bayh-Dole act can not be simply attributed

to the passing of the act alone, since other factors such as the maturing of new

research areas like molecular biology, microelectronics also contributed to this

significant shift (Colyvas et al. 2002)

In USA, it is largely accepted that this legislation has resulted in a widespread

involvement of universities in technology transfer (Deeter M. et al, 2006). Further, the

law has formed a basis for similar policy development across the whole world and is

widely treated as the defacto technology transfer legislation in the University or

publically funded research institute literature (Mowery & Sampat, 2005; Kumar U. et

al, 2006).

According to Japanese law, inventions arising under government-sponsored research

projects belonged to the nation; researchers had little incentive to see their discoveries

classified as National Inventions, which in practice was often "equivalent to the

technology slipping into a black hole" (Kneller, 2003). Therefore, the policy has

affected adversely to personal interests in technology transfer, hence whole

technology transfer. In Germany the intellectual property rights situation was not

much better, as the government was entitled to a varying share of revenues generated

from publicly funded research. Just as importantly, little infrastructure existed to help

scientists or their research institutions explore patenting options (Abramson et al.,

1997).

181

However, in case of India, government has prepared a bill to introduce in Rajya

sabha, named as "the protection and utilisation of public funded intellectual property

bill, 2008". This bill is meant to provide for the protection and utilisation of

intellectual property originating from public funded research and for matters

connected therewith or incidental thereto. This policy initiative on pattern of Bayh­

Dole act has to be judged by its performance over the time. But, the prevailing

provisions in the service rules do not give freedom to scientists to set up commercial

entities while in professional employment with universities/public funded institutions.

Hence, the current condition discourages the hundreds of academicians, in India, to

become technopreneurs which could accelerate the process and speed of technology

transfer and commercialisation (Report of Working group on strengthening academia

industry interface, 2006).

The survey results suggest that present unfavourable service condition and lack of

legal environment and incentives always affect the TT in CFTRI and NDRI. Even the

existing regulatory system for patenting has motivated researchers to go for patenting

the findings and technologies, but that is not enough for acceleration of technology

transfer. Until the Bayh-Dole act patterned bill "the protection and utilisation of

public funded intellectual property bill, 2008" is passed by Indian parliament and

turned to an act, the process of IT continues to be slower and less effective.

6.5.7 Intellectual property rights

Bayh-Dole Act of 1980 has created a uniform IP Policy in US for the publically

funded research and its transfer. Bayh-Dole conclusion by Congress {US) that

Creativity is truly a national asset. The Bayh- Dole act is often credited with the

significant increase in the university patenting and licensing activity during the last

two decades as it essentially clarified the nature of the processes that need to be in

place to bring university technology into the marketplace (Kumar U. et al, 2006). The

patent system in US is the vehicle, which permits delivery of the resource to the

public. It is in the public interest to place stewardship of research results in the hands

of Universities. The existing US IPR laws were ineffective at a time when intellectual

182

property and innovation were becoming preferred global currency. Similarly, India

also has it own intellectual property laws.

India has strong patents system under TRIPS agreement obligations which consist of

Patents Act, 1970, Patent Rule, 1972, Patents (Amendment) Act, 2002, Patent Rule,

2003, Patent (Amendment) Rules 2005. The provisions for granting product patent in

all fields of Technology including chemicals, food, drugs & agrochemicals and the

Ordinance is replaced by the Patents (Amendment) Act 2005. The patent filing by the

institute has increased due to these laws but commercialisation could not be so much

successful. Therefore, a new law, as discussed in preceding section become apparent

to accelerate the process of TT from publically funded institutes as main factor.

Thereafter it protects and utilise the intellectual property created out of public funded

research and development for promoting creativity and innovation in India.

Over the years, the Government has invested large funds in research and

development. To provide incentives for creativity and innovation, it is necessary to

develop a framework in which the protection and utilisation of intellectual property is

put in place. The ultimate objective, however, is to ensure access to such innovation

by all stakeholders for public good. Further, the proposed legislation imposes

obligations and creates rights to optimise the potential of public funded research and

development, provides incentive to create intellectual property and the mechanism for

its protection and utilisation, encourages innovation in small and medium enterprises,

promotes collaboration between Government, private enterprises and non­

Government organisations, commercialisation of intellectual property created out of

public funded research and development and the culture of innovation in the country.

Therefore, a vibrant IPR system affects the level of technological commercialisation

by research institutes in India. The survey results suggest that IPR system is an

important factor in the process of commercialisation of technology from CFTRI and

NDRI.

183

6.5.8 Spin-offs

Traditionally, the universities have looked at TC as essentially a licensing activity and

the standard practice ofTTOs (Kumar, U. et al2006, Siegel et al., 2003a, Siegel et al.,

2003b; Thursby & Kemp, 2002). The recognition being given to university SOs as

vehicles of TC is a more recent phenomenon (Di Gregorio & Shane, 2003). Di

Gregorio & Shane (2003) make a case that University Spin Offs are fast turn out to be

important medium for research commercialization. They account for roughly 12% of

the transfer of the university assigned inventions to the industry, and are highly

successful in it. In India an the oldest 5 IITs have institutionalised incubation and

entrepreneurship programmes. For instance, the Telecommunication Network Group

at the liT, Madras, which specialises in ICT-based telecommunications for

development, has incubated over 22 start-ups and liT Bombay incubated about 17

start-ups in the last five years (INNO-Policy TrendChart - Policy Trends and

Appraisal Report, 2008).

Society for Innovation and Entrepreneurship in Dairying (SINED) a Technology

Business Incubator is set up at NDRI, Kamal, funded by DST, ministry of science &

technology, Government of India. The SINED has potential for incubation and spin

offs in future. It has recently advertised to recruit the competent leader who must have

management background and experience in dairy industry along transfer of

technologies. One can not find the scenario of spin offs like IITs in NDRI because of

late realisation about the importance of incubator for an important institute in dairy

sector in India.

The survey results suggest that incubator is critical in commercialisation and transfer

of technology from NDRI to technology receivers. Therefore, the SINED is fulfilment

of this essentiality of the successful TC.

6.5.9 University venture capital funds:

University venture capital funds are not much significant as far as their influence on

the university technology transfer process is concerned. In their analyses of the

success of Stanford University in technology commercialization, Fisher (1998), points

184

out that success in university technology commercialisation or TT is not solely

dependent upon the availability of funds or the university policies and strategies, but

also on the university's surrounding community's entrepreneurial climate and its own

inherent fertility. However, university venture capital fund has important role in

setting up new companies by its students. The results of the survey suggest about the

importance of university venture capital funds in transfer of technology, but it is not

provided by the both the institutes-CFTRI and NDRI. Both the institute do not have

much experience in such provisions. Therefore, respondents are not sure about extent

of success and contribution to TT.

6.5.1 0 Financing and risk

The financial risk is the critical factor to be considered in technology transfer and it

can be decreased by sharing R&D cost and facilities. The conservative research

centers or university provide only low risk services such as constancy, technical

services and training courses, seminars and workshops for the industry personnel(Lee

J ·and Win H N, 2004). A number of researchers have highlighted the importance of

financial resources or assistance in securing access to sources of funding (Kumar, U.

et al 2006; Shane & Stuart, 2002; Samsom & Gurdon, 1993; Souder et al., 1990;

Goldhor & Lund, 1983). The academics suggest that the universities rarely provide

funds to the researchers to develop and commercialize their technology (Kumar, U. et

al 2006, Etzkowitz, 1998; Lee, 1996; Matkin, 1990). Therefore, researchers unable to

deal with issue of financial risk involved in TT and TC from university.

6.5.11 Attitude/interest/expectation of Firms

An interview with NDRI director revealed that most of Indian dairy firms employed

NDRI alumni who have regular interaction with the institute and its researchers. They

get to know solution and knowledge about technology through informal channel

rather through Technology Office or systematic technology transfer process.

Incremental innovations in certain Indigenous Dairy products are attained through

such mode of technology transfer. Personalised relationship plays key role in

accessing technological knowledge and free consultancy. There is deficit of

185

professionalism on part of faculties and researchers who expect least in exchange of

their knowledge with their own former students who are infact clients of their

intellectual property and innovations as representatives and employees of firms and

industry. Here the subject of concern is publically funded research out comes and

hand over that to right client at suitable cost within appropriate time in appropriate

context and shape.

Firms in Indian dairy sector try to get consultancy through personalised relationship

rather through institutionalised channels. There is dearth of confidence among Indian •

firms on Indian research institutes and their capabilities to provide solution when it

comes to the question of paid consultancies and transfer of know how and

technologies. Where as the scenario of CFTRI is just reverse, as discussed in earlier

sections.

The above discussed factors have varied role in transfer of technology. In addition,

the barriers of also are important to decide the success of technology transfer from the

research institutes. The barriers are discussed further in next section.

6.6 Barriers in transfer of technology by publicaiJy funded R&D

institutes

According to F. Zhao (2004) Australian Universities were unable to attain desired

outcomes in technology commercialisation due to shortage of funding, lack of venture

capital, adverse current taxation laws for start-ups, unwilling industry to collaborate

with universities, lack of entrepreneurial expertise and culture within universities,

insufficient time available for researchers to acquire such skills, lack of management

skills and efficiency. Further, in India, through interview of head and senior scientists

from technology transfer division of NDRI, it is revealed that scientists are not good

marketers and seller of technologies which they have developed. In addition, they are

deprived of skills and expertise on various ways of costing the technology means how

much they can charge from receivers of the technologies. They are good researchers

but lack salesman skills appropriate for TT at appropriate price to appropriate firm or

186

customer of technologies. They face lack of experience in negotiating the licensing

agreements, conditions, prices of technologies or prototypes, and consultancy services

at competitive level.

On the other hand, CFTRI has a different scenario and has advantage of being

supported by CSIR system. But while one see the results of survey that what CFTRI

scientists and management view about it.

6.6.1 CFTRI

The CFTRI confronts a number of TT barriers which become apparent through the

responses from respondents and analysis of such response pattern. There are, under

mentioned, certain TT barriers in descending order of gravity.

- absence of rewards/incentives for technology transfer activities

- More focus on patenting, not on commercialisation and licensing of the

technology

- Perception of University research being "too academic" or not readily usable

by the company

- Confidence level of the firm in the technology generated by the Institute

- No involvement of technology transfer officers in product development

No freedom to negotiate/price fixation /project identification etc and too many

procedures in project approvals

- information gap between potential buyers of technologies to technology

transfer office

- Lack of risk taking abilities in firm

- University research is not ;synchronised with industry's needs, either too early

to too late

187

- Lack of appropriate access of Industry to developed technological information

- Lack of legal permission/provision to allow inventor or researcher to exploit

invention/innovations privately

- Existence of grace period between invention and patent application by the

inventor or any one else on behalf of inventor

- Lack of expertise in transfer of technology

- Lack of appropriate legal environment and incentives

The table 6.4 presents weighted average of five point Likert scale and response

pattern of respondents to different barriers ofTT in CFTRI. The 100% of respondents

are of the view that lack of rewards/incentives for technology transfer activities

critically impinge on TT as crucial barrier. One very important fact emerged in the

survey is that the more focus on patenting, not on commercialisation and licensing of

the technology, has dampened the scope for TT. It is proved by the 33.3%

respondents, who are scientists or do research in laboratory and remaining 66.7%

agree and strongly agree respectively. Indian scientists prefer to patent, but

commercialisation of such technologies is always secondary task.

Table 6.4: Barriers of technology transfer from CFTRI and its relative ranking of weighted average Ranked average summary Weighted average Respondents'

responses

Lack of rewards/incentives for 4.33 Agree 66.7%

technology transfer activities Strongly

33.3%

agree

More focus on patenting, not on 4.33 Agree 66.7%

commercialisation and licensing of the Strongly agree

technology 33.3%

Perception of University research being 4.33 Agree 66.7%

"too academic" or not readily usable by

188

Ranked average summary Weighted average Respondents'

responses

the company Strongly agree

33.3%

lack of information about potential 4.00 Strongly agree

buyers of technologies to technology 33.3%

transfer office Agree33.3% Agree nor disagree 33.3%

lack of risk taking abilities in firm 4.00 Strongly agree

50% Agree nor disagree

50% University research is not synchronised 4.00 Agree 100%

with industry's needs, either too early to

too late

lack of appropriate access of Industry to 3.67 Agree 66.7%

developed technological information Agree nor disagree 33.3%

lack of legal permission/provision to 3.00 Agree 33.3%

allow inventor or researcher to exploit Agree nor disagree 33.3%

invention/innovations privately Disagree 33.3% Existence of grace period between 2.67 Agree nor disagree

invention and patent application by the 66.7%

inventor or any one else on behalf of Disagree 33.3

inventor

lack of expertise m transfer of 2.67 Agree 33.3%

technology Disagree 66.7%

lack of appropriate legal environment 2.00 Agree 33.3%

and incentives Strongly disagree

66.7%

Confidence level of the firm m the Scientists/researchers

189

Ranked average summary Weighted average Respondents'

responses

technology generated by the Institute identified

No involvement of tech transfer officers TTO

in product development managers/officers

No freedom to negotiate/price fixation -do-

/project identification etc

Too many procedures m project

approvals

Source: Survey analysts by author

The Indian firms who are prospective customers of the technologies developed by the

CFTRI have their own perception about such technologies. Perception of University

research being "too academic" or not readily usable by the companies creates hurdle

in successful commercialisation of such developed technologies. These technologies

are not appropriately transferred to right customer at right place in right context

within right time. This hurdle has been ranked at weighted average of 4.33 on five

point Iikert scale which supports strongly to the stated position.

The scientists and researchers in TTO and laboratory have identified confidence level

of the firm in the technology generated by the Institute as an influence that upset

technology commercialisation. On other hand, individuals who are involved in TTO

as managers or officers strongly believe that they should be involved in product

development because they assume that they know better about the needs and demands

of the customers e.g. firms. Non involvement of technology transfer officers in

product development becomes strong barrier in successful TT.

There is consensus among all the respondents that University research is not

synchronised with industrial needs, either too early to too late. Therefore, there is

always gap between demand and supply. Equally, respondents have supported that

there is lack of information about potential buyers of technologies to TTO. The TTO

is unable to bridge the gape of such critical information between institute and

190

industry. It clearly indicates the shortage of capability of TTO for efficient TT and

TC.

The TTO has crucial role in TT and technology commercialisation (TC). The

independence of the TTO management in negotiating prices and project identification

shape the process TT. No freedom to negotiate/price fixation /project identification

has an effect on TT in CFTRI, as revealed by TTO. This condition in institute is an

indication of less contribution of technology transfer and management skills to realise

the objectives of TT and TC.

The bureaucratic system makes the whole process of TT and TC much less effective

because of its lack of flexibility, transparency and adoptability to innovations in the

system. As experts in TTO believe that too many procedures in project approvals in

CFTRI under CSIR considered as a major barrier in TT. But how many of these are

the barriers for TT in NDRI?

6.6.2 NDRI

The results of the study show that some of the TT barriers in NDRI are similar to

what CFTRI has been facing where as some other are different with degree of

effectiveness and severity. The table 6.5 has demonstrated the results of the study on

barriers in TT and their relative effectiveness.

Table 6.5: Barriers of technology transfer from NDRI and its relative ranking of weighted average Ranked average summary Weighted average Respondents'

responses

Lack of rewards/incentives for 4.67 Strongly agree

technology transfer activities 66.7%

Agree 33.3%

lack of appropriate legal environment 4.33 Agree 66.7%

and incentives Strongly agree

33.3%

191

Ranked average summary Weighted average

Perception of University research 4.33

being "too academic" or not readily

usable by the company

lack of risk taking abilities in firm 4.00

lack of legal permission/provision to 4.00

allow inventor or researcher to exploit

invention/innovations privately

More focus on patenting, not on 4.00

commercialisation and licensing of the

technology

lack of information about potential 3.67

buyers of technologies to technology

transfer office

University research IS not 3.67

synchronised with industry's needs,

either too early to too late

lack of expertise m transfer of 3.67

technology

192

Respondents'

responses

Strongly

66.7%

agree

Agree nor disagree

33.3%

Strongly agree

33.3%

Agree33.3%

Agree nor disagree

33.3%

Agree 100%

Strongly

33.3%

Agree33.3%

agree

Agree nor disagree

33.3%

Agree 66.7%

Agree nor disagree

33.3%

Agree 66.7%

Agree nor disagree

33.3%

Strongly agree

33.3%

Agree33.3%

Ranked average summary Weighted average Respondents'

responses

Disagree 33.3%

lack of appropriate access of Industry 2.33 Strongly agree

to developed technological 33.3%

infonnation Agree nor disagree

33.3%

Disagree 33.3%

Existence of grace period between 2.33 Agree 33.3%

invention and patent application by the Agree nor disagree

inventor or any one else on behalf of 66.7%

inventor

Less practicality of technology Scientists/administrator. -

developed to the user's situation. identified

Industry is not than keen in buying the Scientists/researchers -

technology but want all kinds of know identified

how without judicious spending.

Lack of willingness on the part of the -do- -

industry to spend money on

technology

Inadequate refinement of technology -do- -

to meet the needs/expectations of the

user industry

Source: Survey analys1s by author

The outcomes of the survey administered on scientists, researchers and technology

management experts in NDRI has revealed following barriers in TT by NDRI.

- Lack of rewards/incentives for technology transfer activities

- lack of appropriate legal environment and incentives

193

Perception of University research being "too academic" or not readily usable

by the company

lack of risk taking abilities in firm

- lack of legal permission/provision to allow inventor or researcher to exploit

invention/innovations privately

More focus on patenting, not on commercialisation and licensing of the

technology

lack of information about potential buyers of technologies to technology

transfer office

University research is not synchronised with industry's needs, either too early

to or too late

- lack of expertise in transfer of technology

lack of appropriate access of Industry to developed technological information

- Existence of grace period between invention and patent application by the

inventor or any one else on behalf of inventor

Gap between the technologies developed and demand of users.

Industry is not than keen in buying the technology but want all kinds of know

how without judicious spending.

- Lack of willingness on the part of the industry to spend money on technology

- Inadequate refinement of technology to meet the needs/expectations of the

user industry

The lack of rewards/incentives for technology transfer activities, lack of appropriate

legal environment and incentives, and Perception of university research being "too

194

academic" or not readily usable by the company are the strongest barriers as felt and

agreed by the respondents. These barriers have weighted average between 4.33 and

4.67 on scale of 5 which is supported by 66.7% of respondents. It implies that

institute has faced a gap between industry's perception and expectation about the

technologies developed by the institute and real deliverance by the NDRI. The

industry has lack of willingness to spend on technologies developed by the institute's

scientists and readily available with consultancy board for transferring.

On the other hand, some TT barriers are of moderate to slightly stronger level which

consist of, in descending order of severity of constraints, lack of risk taking abilities in

firm, lack of legal permission/provision to allow inventor or researcher to exploit

invention/innovations privately, and more focus on patenting rather than

commercialisation and licensing of the technology. All the three barriers have

weighted average 4.00, supported by more than 66% respondents.

The fact has come out that NDRI does not have expertise in TT due to lack of skilled

and trained man power with consultancy board which is responsible for TT.

Therefore, lack of expertise in transfer of technology in the institute is a major barrier;

the fact is supported by more than 66% of responses. In addition, lack of appropriate

access of Industry to developed technological information has created a gap between

industry and institute. Low level of interaction with industry has further adds the

severity to this TT barrier. The industry is not timely informed of the technologies

under development and developed by the scientists of NDRL This further makes

industry disinterested in such technology because they never participate in

improvement of any technology which is being used by the industry at that time. Until

the industry participate in sharing and developing information and knowledge source

about technology, the technologies are likely to get delayed in transfer or remained

non-transferred.

The scientists, at NDRI, who develop technology as well as individuals who are

responsible for technology transfer in ITO are incompetent in calculating cost of

technology, fixing price and valuing the innovations. The questions like: How much

195

charge/cost of the innovation, invention, technology, prototype etc? , are most

difficult to answer.

The consultancy business board (CBB) is headed by, most of the time, the head of

dairy technology division of NDRI or some time by Head Dairy Engineering who do

not have any fonnal training in technology transfer and technology management. The

job of technology transfer needs a comprehensive training and experience m

technology transfer and management. Therefore, it becomes barrier for TC.

CBB in NDRI do not have any training programmes for scientists and researcher on

issues related to successful commercialisation of technology. Further, even, it does

not have skilled trainers who can plan for such programmes for future successful

technology transfer. Such dearth of competencies posed as an obstacle to successful

technology transfer.

6. 7 Requirement for successful technology transfer

The successful transfer of technology requires certain conditions to be presented in

the scenario of the technology transfer. University-Industry interaction is desirable for

TT, as all strongly agreed on it. Technology Transfer requires continuous

communication between technology developer (institute) and receiver (firm,

individual, organisation, and farmer). 100% respondents from CFTRI have strongly

agreed with this view wherein communication decides the level and success of the

technology transferred.

Technologies developed through joint projects and partnerships have highest

probability and success rate of technology transfer from CFTRI. The joint projects

have involvement of partners and work on principle of sharing of responsibility,

profit, and risk. This position was taken by 100% respondents from CFTRI that the

technologies should be developed through partnerships and joint projects so that they

can be transferred with maximum success. Equally supported, Interaction of

universi~ researchers/ academics and industry enhance the success of technology

196

transfer. The technologies, developed by the research institute and information about

them, are transferred through interactions among academics and industry.

Further, Researchers need to increase contact and interaction with technology clients

(industry, farmers etc) for enhancement of technology transfer. It has received

consensus that higher level of contact and interaction with clients of technology help

in understanding about their needs. 66.7% of the 'total respondents strongly agree

with this view.

Successful processes and mechanisms of technology transfer vary from one sector to

other sector as well as from one institute to other. The institutional culture and setting

plays crucial role in deciding efficiency of mechanisms ofTT. Administration ofTTO

and its openness to discussion about the disclosures of innovations and inventions

varies from one institute to other. Dissemination and TI strategies are different in

NDRI and CFTRI, which can be differentiated at first interaction and approach to TT.

The licensing of technology depends on interaction of technology developer and

receiver. Therefore, the Geographical proximity of firms to university/institute

stimulates corporate patent/licensing activities, 100% respondents from CFTRI

agreed, in context ofTT by CFTRI.

The licensing activity generates revenue that is shared, in some cases, not shared in

other cases, among funding agencies, research institute, innovator/inventor/researcher,

and university. Sharing of royalty/license fee with researcher/faculty is essential for

attaining higher level of TT, as perceived and agreed by 66.7% of individuals from

the CFTRI. This majority consists of scientists who are involved in research and

technology transfer whereas minority opinion/views consist of management

background individuals. Hence, this finding assumes importance because, some how,

non-sharing of royalty/license fee, such provisions, discourage the researcher to take

up more activities ofTT. In other words, it may be argued that monetary inducements

are necessary to accelerate TT process.

197

The research institute- NDRI has to overcome to its aloofness and isolation with

industry on sharing of information, partnership, creating confidence in industry about

its capabilities, marketing itself to industry and taking development of technology in

synergetic manner. The industry and publically funded research institutes need to

develop a strong interactive and communication channel through building a system of

technology transfer and incubation in terms of organisation. The information on

technology underdevelopment, developed, ready for transfer and commercialisation

and available capabilities and expertise must be made available through such office.

The industry needs to get motivated through serious efforts at part of institute.

6.8 Summary

Effective technology transfer is greatly facilitated by the close interaction of

individuals involved in the development, transfer, and/or application of technology. In

spite of communication revolution, technology transfer remains contact sports,

involving close interaction among individuals from universities, firms and

organsiations. Mobility of technical individuals among institutions is an important

facilitator of technology transfer.

Technology transfer is highly industry and technology specific. The preferred

mechanisms of technology transfer vary depending on the characteristics of the

technology being transferred, the industry involved, and the rate technological change

affecting the industry at a time. Research publications, conferences, and movement of

research personnel from academic institutions and University to industrial research

institutes and organisation are important technology transfer mechanisms in Dairy

industry. However, CFTRI has been using some these TTM.

Further, the mechanisms of transfers of technologies employed by CFTRI are

Licensing, technical assistance, Sponsored Research projects, Consultancy, New

Start-up ventures, Extension, Formal exchange, Cooperative and/or collaborative

R&D, Formal dissemination of research results (e.g., conferences, seminars,

publications, trainings), and Informal discussions and sharing of research results.

198

Certain TTM such as science park, research park, technology park or incubators,

technology donations, Personnel exchange, and Private-sector uses government

funded facilities are never adopted by CFTRI.

On the other hand, formal dissemination of research results (e.g., conferences,

seminars, publications, training), extension, Jicensing, technical assistance, incubators,

cooperative and/or collaborative R&D between NDRI and the private/public, and

New Startup venture are some of the important TTM employed by the NDRI.

However, certain TTM are not used by the institute such as Infonnal discussions and

sharing of research result, Technology Donations, Private-sector uses government

funded facilities, and Personnel exchange.

The mechanisms of TT are institute specific, as interviews and survey results suggest,

which have their origin in institutional structure, mandate, objectives, area of

research, contro1ling rules and laws on TT, institutional culture, leadership in the

institute, attitude of scientists and researchers, opportunity for involvement of

technology developer and transferrer, firm's behaviour towards institute and it's

technology, available expertise on TT with institute, IPR policy, structure of TTO,

overall national science and technology policy and available funding.

The relative effectiveness of various TTM was measured in terms of relative ranking

on scale of 5. Contract research, Licensing, and Consultancy and technical services,

are most effective and excellent TTM for CFTRI. Additiona1ly, collaborative research

and Training are two more TIM which are highly effective for the institute. Final1y,

extension programs, seminars, workshops, conferences and publication are good

TTM.

The most effective TTM among all for the NDRI are Co1laborative/Joint Research,

Consultancy and Technical Services, Students Projects and Work Terms in Industry,

and Seminars, Workshops, Conferences and Publication. However, licensing is a

TTM with an average effectiveness.

199

There are certain factors which have important role in transfer of technology, in case

of CFTRI and NDRI. There are some specific factors such as institute industry

interaction and partnership, stakeholder involvement, technology transfer office,

sharing of royalty, top management and institutional culture, policy and regulatory

system, spin offs, and attitude of firms toward research results.

Both the institute have been facing barriers for technology commercialisation. Some

of the important barriers for the CFTRI are absence of incentives for TT activities,

more focus on patenting and less on commercialisation and licensing, perception of

research as too academic, non risk taking behaviour of firms, constraints to negotiate

price, terms and condition of project, and information gap between technology buyer

and developer. NDRI has been facing some important barriers in TT like technology

transfer activities with no incentives, inappropriate laws and policy, low risk taking

ability of firms, patenting more focussed rather technology commercialisation,

information gap between buyers and supplier, and lack expertise in TT.

Technology transfer can be enhanced in both the institutes through more industry

institute interaction, sharing of royalty, taking up more joint projects and partnerships

and constant communication.

200