Technology models help entrepreneurs in technology acquisitions

The word "technology" includes different things we use to solve the problems we face. Technology can mean many things. For example, it can mean various physical devices, processes, and digital software. When we discuss about technology with someone else, their perception of technology is likely different from ours due to the complexity of the topic. This mismatch of thoughts may lead to misunderstanding and further errors in technology-related decision-making.
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These misunderstandings can be unpleasant for entrepreneurs. They can for example accidentally end up acquiring technology that has little benefit for them or technology whose high costs put their company in to difficult financial situation.

So what one can do to alleviate this situation? Well, like with many other things, modeling and breaking technology into smaller topics can help us to understand it better and to discuss constructively about it with others. There are different approaches to breaking technology into topics that help us to understand the so-called “technology environment”. These approaches can help entrepreneurs to ponder more constructively about technologies and to have more informative discussions with technology providers. In this blog, I delve deeper into one of these approaches, a model presented by Talavera et al. (2017) which describes the technology environment in the agricultural sector. Their approach is practical and can be also adapted to other sectors.

In their model, the agricultural sector´s technology environment is divided into four levels: physical, communication, service, and application level. Technologies act either on one of these levels or on multiple levels. Each level contains certain type of topics:

  • Physical level includes physical devices that perceive or control the environment.
  • Communication level includes data transmission technologies such as WiFi and Bluetooth, which are used to transfer data from physical devices to the Internet.
  • Service level includes solutions such as databases where information transmitted to the Internet is stored.
  • Application level includes user interfaces such as applications that allow the end users to utilize technologies.

These four levels are logically built on top of each other. When entrepreneurs plan to acquire technology, they should use this model to identify how the planned technology will work and to convey their needs clearly to technology providers.

Best practices for each of the levels can also be identified when technology acquisition is planned. These include e.g.:

  • At the physical level, the energy efficiency of technology and renewable energy sources, as well as the precision, coverage, and sustainability of technology
  • At the communication level, the reliability, cost-effectiveness, and security of data transfer technology
  • At the service level, data management system interoperability, and scalability
  • At the application level, the usability and adaptability of the user interface and the compliance of the user interface with regulations

Multi-level best practices for technology acquisitions can also be identified. These include e.g.:

  • Interoperability and security between individual levels and scalability of the overall solution

More information and ideas for the usage of the model can be found in Talavera et al. (2017) publication.

Sources:
Talavera, JM, Tobón, LE, Gómez, JA, Culman, MA, Aranda, JM, Parra, DT, ... & Garreta, LE (2017). Review of IoT applications in agro-industrial and environmental fields. Computers and Electronics in Agriculture, 142, 283-297.

Author:
Peetu Virkkala, DI (Industrial Engineering and Management), PhD student, University of Oulu Kerttu Saalasti Institute, Micro-enterprise research unit MicroENTRE