RDP Technonationalism & MOT_Final

7/30/2019 RDP Technonationalism & MOT_Final

1/31

1

TECHNONATIONALISM AND TECHNOLOGY MANAGEMENT

FOR BUILDING A RICH NATION AND A STRONG MILITARY*

by

Roger D. Posadas, Ph.D.**

1. INTRODUCTION

Good morning, distinguished officers and personnel, ladies and gentlemen of the

Philippine Navy and other branches of the AFP. I would like to express my

appreciation to the Philippine Navy through its Center for Naval Leadership and

Excellence for inviting to give a talk during the Eighth Leg of the Philippine Navys

Governance Forum Series. It is truly a distinct honor and privilege to be able to talk

to some of the top brass of the AFP on an advocacy that I have been writing and

lecturing about for thirty years now the need for technonationalism and technology

management for building a rich Philippine nation and a strong Armed Forces of the

Philippines.

_____________________________________________

* Invited talk delivered on 09 November 2012 for the Ninth Leg of the Philippine Navys

Governance Forum Series under the auspices of the Center for Naval Leadership and Excellence,

Philippine Navy.

** Professor of Technology Management, Technology Management Center, University of the

Philippines-Diliman, Quezon City.


2/31

2

It has become a consensus that the Philippines was second only to Japan in East

Asia in industrial, technological, and economic development in the 1950s. Since

then, however, the Philippines has been overtaken by its neighbors in East Asia with

the exception of Vietnam, Myanmar, Laos, and Cambodia.

So why has the Philippines been left behind by its East Asian neighbors? Why

has the country remained underdeveloped scientifically, technologically,

economically, and militarily? Why has it failed to become a newly industrialized

country like South Korea, Taiwan, and China up to now? Why has the Philippines

ended up as a poor nation with a weak military? Is it because our country has been

implementing protectionist, nationalist policies for too long and has failed to adopt

open, liberal policies soon enough, as most mainstream liberal economists have been

declaring? Or is it because our country has failed to emulate the East Asian model of

technonationalist catch-up industrialization as exemplified by the economic miracles

of Japan, South Korea, Taiwan, and China?

In this talk I will try to explain why the Philippines has remained backward and

dependent scientifically, technologically, economically, and militarily up to now and

what must be done to enable our country to catch up scientifically, technologically,

economically, and militarily. Section 2 first gives a brief overview of the extent to

which the Philippines has been left behind in terms of per capita GDP from 1950 to

2008. Then Section 3 presents an updated review of the weak and dependent state of

Philippine technological capabilities. Next Section 4 traces the colonial-cultural

roots of Philippine underdevelopment by contrasting Filipino attitude toward

Western technology with Japanese and other East Asian attitudes. Then Section 5

discusses how Philippine underdevelopment has been given economic ideological

reinforcement by the liberal economic ideology and technoliberal thinking that have


3/31

3

held sway in our country since 1986. Section 6then discusses how the technoliberal

policies of successive Philippine governments have entrapped our economy in a

vicious circle of technological laggardness and dependence. Then Section 7

proposes a way out of this vicious circle through the pursuit of a "technonationalist,

catch-up oriented", and "capability-based approach that draws from the

successful national catch-up experiences of East Asian newly industrialized

countries and seeks to achieve rapid national economic and technological catch-up

for the purpose of transforming our country into a rich nation with a strong military.

Next Section 8 explains how this technonationalist approach can be successfully

implemented through the use oftechnology management. Finally, Section 9 will

close my talk with some concluding remarks.

2. Overview of the Extent to Which the Philippines Has Been Left Behind

Based on GDP per capita (PPP dollars), the Philippines was actually No. 4 in

1950 among East Asian countries, ranking below Singapore, Japan, and Malaysia as

shown in Table 1. Nevertheless, in 1950 the per capita GDP of the Philippines was

slightly higher than those of South Korea and Taiwan, about 1.5 times those of

Thailand and Indonesia, and more than 2.5 times that of China.

The Philippines, however, was overtaken by Taiwan in 1960, by South Korea

in late 1960s, by Thailand in the early 1980s, by Indonesia in the late 1990s, and by

China in 2000, and it is about to be overtaken in the next five years by Vietnam as

indicated in Table 1 and shown dramatically in Figure 1.

These facts and figures cannot be disputed; they imply very clearly that there is

something drastically wrong with the development strategies and economic

policies of the Philippine government. Since there is now a consensus that


4/31

4

economic development is a catch-up process and that catching up requires building

up technological capabilities, it follows that the Philippine economy has been left

behind because it has failed to upgrade its technological capabilities to globally

competitive standards. So we now examine the technological capabilities of the

Philippines.

TABLE 1: THE GROWTH IN GDP PER CAPITA BY PPP$ OF THEPHILIPPINES AND OF ITS NEIGHBORS

2,5761,577894660641696579Vietnam

3,2792,5982,3862,5491,8931,5841,149Philippines

3,7082,7152,0971,549986834704Indonesia

5,5202,5641,465868665592418China

7,7765,5784,0392,2271,477940712Thailand

12,79410,1616,3864,5502,5871,9041,940Malaysia

23,82417,54310,7395,0762,6741,5131,054Korea, Rep.

28,56023,09413,3616,9953,3001,6791,064Taiwan

31,82328,55925,87018,48813,3755,4892,645Japan

45,29536,83523,14314,1046,9943,4263,533Singapore

2008200019901980197019601950Country

Source: Gapminder(2010)

3. Overview of Philippine Technological Capabilities

The extent of technological development of a firm, industry, or country can be

gauged in terms of two dimensions:


5/31

5

1. Technological Capability -- the level of technological skills and know-how

of a firm, industry, or country

2. Technological Sophistication measure of proximity to the state-of the-art

of the key technologies being used by a firm, industry, or country.

0

5000

10000

15000

20000

25000

30000

1950 1960 1970 1980 1990 2000 2008

Taiwan

Korea, Rep.

Malaysia

ThailandChina

Indonesia

Philippines

Vietnam

Figure 1Graph of the Growth in GDP per Capita by PPP$

of the Philippines and of its Neighbors

The most important gauge of a firm's, industry's, or country's level of technolo-

gical competitiveness is its level of technological capability. Depending on what

it is capable of doing with products and processes, a firm's technological capability

can be identified with one of the rungs in the following ladder of technological

capabilities from the lowest to the highest level:


6/31

6

Acquisitional Capabilitythe ability to assess, select, and acquire appro-

priate technologies from external sources.

Operative Capability the ability to implement, operationalize, and repairan externally acquired technology.

Adaptive Capability the ability to adapt an external technology to local

conditions through the modification of its scale, capacity, inputs, and peri-

pheral components.

Integrative or Investment Capability the ability to assemble a complextechnological system or commission a production facility on a self-reliant

basis.

Duplicative Capability the ability to reverse engineer and make a dupli-

cate of an externally acquired product or process technology.

Improved-Design Capability the ability to improve the design of anexisting product in terms of performance, architecture, or aesthetics without

changing the existing technology.

Reproductive Capability the ability to reproduce the core component(s)

of an externally acquired product technology.

Innovative Capability the ability to design and commercialize an

incremental but significant improvement of the core or basic technology of

an existing product or process.


7/31

7

Creative Capability the ability to create a radically novel, breakthrough

technology through endogenous research and development and to

commercialize it into a new-to-the-world product or process.

On the other hand, the levels of technological sophistication can becategorized roughly into

1. First-Wave Technologies the pre-industrial, craft or artisan technologies

which are based on empirical know-how rather than scientific knowledge

2. Second-Wave Technologies the industrial technologies which are based onthe classical scientific knowledge of the bulk or macroscopic properties,

structures, behaviors, and interactions of matter.

3. Third-Wave Technologies the post-industrial or high technologies which are

based on the latest scientific knowledge of the structure, properties, behaviors, and

interactions of molecules, atoms, nuclei, and fundamental particles.

Examples of these three broad levels of technological sophistication for various types

of technologies are shown in Table 2.


8/31

8

TYPES OFTECHNOLOGY

FIRST WAVETECHNOLOGIES

SECOND WAVETECHNOLOGIES

THIRD WAVETECHNOLOGIES

MATERIALSTECHNOLOGIES

Copper, Bronze,Iron, Ceramic

Steel, Aluminum,Petrochemicals

Semiconductors,Composites

INSTRUMENT

TECHNOLOGIES

Plow, Saw, Spinning

Wheel

Engines, Motors,

Machine Tools

Lasers, Robots,

MicromachinesENERGYTECHNOLOGIES

Firewood, Watermill,Windmill

Steam Engine,Turbogenerator

Photovoltaics, NuclearFusion

INFORMATIONTECHNOLOGIES

Printing Press,Pens, Books

Typewriter, Radio,Telephone, TV

Computers, Internet,Mobile Phone

MEDICALTECHNOLOGIES

Traditional Medicine,Herbal Medicine

Immunization, ModernSurgery

MRI, Biotech Medicine,Smart Drugs

AGRICULTURALTECHNOLOGIES

TraditionalAgriculture

Mechanized Agriculture,Green Revolution

Biotech Agriculture,Precision Smart Farming

MANUFACTURINGTECHNOLOGIES

Craft-Based and

Guild Manufacturing

Factory-Based, Mass

Production

CAD/CAE/CAM, FMS

Robotic FactoriesMILITARYTECHNOLOGIES

Sword-and-Shield,Bow-and-Arrow

Guns and ExplosivesTanks and Airplanes

Space Wars, ElectronicBattlefield

Table 2. Examples of Levels of Technology

Our countrys level of technological capabilities can be gauged roughly fromour economys exports and imports:

The Philippines exports mostly low value added products such as garments;

assembled integrated circuits or ICs; fashion accessories; gifts, toys, and

houseware; fresh and processed fruits; tuna, shrimp, and seaweed; furniture;

and low-end software; and contract workers.

Our country, in turn, imports high-tech products such as power-generating

machineries, specialized machines, heavy equipment, transport engines and

equipment, telecommunications equipment, computing equipment, machine

tools, chemicals, bulk pharmaceuticals, IC wafers, etc.


9/31

9

Although the Philippines today is one of the major exporters of high technology

products (principally, electronic products) from the developing world, it is a well

known fact that it is able to achieve this high electronic export performance by

importing the core components (the IC wafers) and other raw materials from

abroad and then assembling them into finished electronic products with the use of

cheap labor but with very little value added (Mani, 2002; Salazar, 1998).

Based on the personal observations and assessments of Posadas and Roque

(1994), Philippine domestic firms, except for a handful, have not been able to

develop technological capabilities beyond the adaptive levels with respect to

foreign-sourced technologies, even those that are already mature and declining . In

general, domestic firms acquire the technologies they need through licensing, joint

ventures, turnkey projects, and other modes of international technology transfer

and simply implement these foreign technologies without attempting to reverse

engineer these technologies, master them, and improve them.

Since none has reached duplicative and higher technological capabilities

(except for one or two), almost all Philippine domestic firms have remained mere

technology importers, consumers, and users that are highly dependent on the

acquisition of foreign technologies to meet their technical needs.

As a consequence, the Philippine economy has remained a mere importer and

consumer of industrial and high technologies and has not yet learned to become a

producer and exporter of advanced technologies. Philippine technological

capabilities are still largely backward and dependent, being mostly adaptive

relative to industrial 20th century technologies, and merely theoretical or at most

operative relative to 21st century high technologies.


10/31

10

An egregious yet typical example of the weak and dependent technological

capabilities found in almost all Filipino-owned firms is the National Power

Corporation (NPC or NAPOCOR), which has remained at the operative level in

electric power generating capabilities since 1972 due to this company's continuing

dependence on foreign firms for the design and construction of power plants. In

stark contrast, its South Korean counterpart, KEPCO, has successfully attained

innovative capabilities and global competitiveness in electric power generation

technologies, including nuclear power technology.

Another glaring example of Philippine technological weakness is the jeepney

which some Filipinos like to claim as the embodiment of Filipino ingenuity but

which to me exemplifies Filipino inability to achieve self-reliance in designing and

manufacturing an internal combustion engine a hundred-year old technology that

Koreans, Malaysians, and Chinese have learned to design and produce on their

own.

Thus, the Philippine economy can be characterized as

having very low levels of technological capabilities;

being highly dependent on the importation of technologies though various

modes of international technology transfer from technology purchase, licensing,

subcontracting, turnkey projects, joint ventures, and foreign direct investments;

having no motive or effort to learn and master the imported technologies or to

move up the ladder of technological capabilities;

being averse to local technology sourcing or technology transfers from

domestic R&D laboratories;


11/31

11

lacking competence in technology management and making do with poor

product and process technologies; and

lacking technology-based global competitiveness.

4. Colonial Cultural Roots of Philippine Underdevelopment

One of the major differencesbetween East Asians (i.e., Japanese, Koreans,

Taiwanese, and Chinese) and Filipinos is their contrasting attitudes towards

Western technology and their own national culture.

After U.S. Commodore Perry had forced Japan in 1853 to open its doors to

foreign trade by demonstrating the superiority of Western (military) technology,

some Japanese samurai decided to overthrow the feudal Tokugawa Shogunate and

replace it with a modernizing Emperorled regime that could industrialize Japan

and enable it to catch up with the US and European powers economically,

technologically, and militarily. So when they succeeded in putting the young

Emperor Meiji on the throne in 1868, they immediately carried out an

industrialization program under the basic formula of Japanese Spirit, Western

Technology, that is, upholding Japanese values, culture, and nationalism while

mastering and leapfrogging Western technologies. Later this formula was directed

towards the specific twin goals of building a Rich Nation, Strong Army. This

motto -- Rich Nation, Strong Army which was the inspiration for the title ofthis talk, was also the title of a book by Richard J. Samuels (1996) that tells the

story of how the Meiji regime was able to achieve industrial and technological

catch-up by 1903 such that in the 1904-1905 Russo-Japanese War the Japanese

imperial navy and army, using Japanese-built battleships and warships and


12/31

12

weapons, were able to defeat the Russian armed forces. Rich Nation, Strong

Army was a simple yet powerful motto that was based on the recognition by

Japans Meiji leaders that the West was strong because their industry, science, and

technology produced weapons that Japan and other Asian countries did not have.

From the 1960s onwards this successful Japanese model of nationalist industrial

and technological catch-up would become the inspiration for the successful

industrialization efforts of other East Asian countries like South Korea, Taiwan,

China, and Malaysia. These newly industrialized countries (NICs) basically

followed the Japanese formula of Asian Spirit, Western Technology and

pursued the Japanese motto of Rich Nation, Strong Army. In other words,

they upheld nationalist values in order to master, catch up on, and leapfrog

Western technologies for the purpose of building a rich economy and a strong

military.

In contrast, after the Filipino revolutionaries were defeated in the 1898-1901

Philippine-American War due mainly to the superiority of US military technology,

our grandfathers and great grandfathers did not follow the Japanese formula of

Filipino Spirit, Western Technology. Instead, they adopted the reverse formula

of Western Spirit, Filipino Technology, that is, they opted to emulate Western

values and culture, imbibed a colonial mentality, neglected to master Western

technologies, kept a low level of technological capability, and continued to be

mere importers and users of technology. And so unlike our successful East Asian

neighbors, we Filipinos continue to have low levels of scientific and technological

capabilities and we ended up with a poor nation and a weak military that can be

bullied by other nations.


13/31

13

5. The Economic Ideological Reinforcement of Philippine Underdevelopment

The economic and technological backwardness and dependence of the

Philippines are also being reinforced and perpetuated by the economic ideology of

liberalism, which is being propagated and taught by the countrys mainstream

economists, practiced by most local businessmen, and implemented by successive

Philippine governments since 1986.

Liberalism refers to the economic ideology that advocates laissez faire, free

trade, free markets, free enterprise, a minimal role for the state in the economy,

privatization and deregulation, and comprises the neoclassical economic theories

of Adam Smith, David Ricardo, Friedrich Hayek, and Milton Friedmann. After

the establishment of the Bretton Woods institutions (the IMF and the World

Bank), GATT, and the World Trade Organization, liberalism came to be known

as neoliberalism and since the 1990s became synonymous with the so called

Washington Consensus, i.e., the economic policy consensus and prescriptions

of the IMF, the World Bank, and the U.S. Treasury which are located in

Washington, D.C.

Liberalism holds that the solution to the underdevelopment of our countrys

economy and technology is to make all economic, business, and technology

decisions conform to market needs, problems, and opportunities and to the

"principle of comparative advantage." The latter principle holds that a firm,

industry, or country should specialize on production technologies and systems that

can make maximum use of its current endowments or its comparative advantage.

The application of this neoclassical economic principle of comparative

advantage to the selection, acquisition, and exploitation of technology is called


14/31

14

technoliberalism which holds that a firm should not design and produce its own

technology if it does not have the comparative advantage to do so or, in other

words, if it is easier and more cost-effective to buy or lease the technology.

Thus, technoliberalism is the economic reason behind the NPCs unwillingness

to design and produce its own power plants, turbines, and generators and its

continuing addiction to the importation of power plants and power equipment

through turnkey projects. Technoliberalism is the reason why most Filipino-owned

firms have remained technologically backward and dependent, have continued to

be mere users and importers of foreign technology, and have not attained

technological capabilities beyond adaptive levels.

It is technoliberalism that has been preventing our economy from

industrializing, keeping our economy stagnant and dependent on OFW remittances,

allowing our neighbors overtake us in terms of GDP per capita, and perpetuating

the AFPs laggardness in military technology and dependence on old, hand-me-

down weapons and equipment from the U.S. military

Neoliberalism and technoliberalism are flawed ideologies that are refuted by

the fact that their adoption by successive Philippine governments since 1986 has

kept our economy and technology underdeveloped while their rejection by Japan,

South Korea, Taiwan, China, and Malaysia enabled these countries to achieve

rapid industrial, technological, and economic catch-up. In fact, these late

industrializing countries deliberately defied the principles of comparative

advantage to create globally competitive industries in steel-making, shipbuilding,

transport vehicles, IC fabrication, mobile communications, machine tools, heavy

equipment, power generation, etc.


15/31

15

Although Dr. Bernardo Villegas (2009), one of the most vocal advocates of

liberalism in the Philippines, has recently blamed our countrys continuing

underdevelopment on the anti-market, protectionist, import-substituting policies

adopted by the government since 1945, the fact is that liberalism has been the

dominant economic ideology of our country for the past 27 years which was also

the period when we were overtaken by Thailand, Indonesia, and China.

In the past five years, the ideological hegemony of neoliberalism itself has been

undermined by the consensus, among critics and proponents alike [such as J.

Stiglitz (2004), D. Rodrik (2006), and S. Radosevic (2009)], that the Washington

Consensus is a failed recipe for economic development. In fact, development

economists are now working out a post-Washington Consensus that appears to be

more open to the emerging alternative economic paradigm known as innovation

economics.

6. The Vicious Circle of Technological Laggardness and Dependence

The adoption of technoliberalism has made our national economy dependent

on the import of foreign technologies and effectively eliminated demand for

domestically created technologies. This almost zero demand in turn has reduced

pressure on the government and industry to make substantial investments in the

national development of science and technology or S&T. This underinvestment in

S&T in turn has rendered local S&T underdeveloped and incapable of meeting the

technological needs of local industry. And this local technological incapability in

turn has reinforced the dependence on technology importation, resulting in a

vicious circle of S&T and economic underdevelopment and dependence, as

depicted in Figure 2 and Figure 3.


16/31

16

WEAK S&T

RESOURCES &

CAPABILITIES

CONTINUING

TECHNOLOGICAL

DEPENDENCE

WEAK EFFECTIVE

DEMAND FOR

LOCAL S&T

LOW LEVEL OF

PUBLIC & PRIVATE

SUPPORT FOR S&T

FIGURE 2. MACRO VIEW OF THE VICIOUS CIRCLE OF PHILIPPINE

S&T AND ECONOMIC UNDERDEVELOPMENT AND DEPENDENCE


17/31

17

LOCAL FIRMS LACK OF

DRIVE TO CONDUCT MOT,

R&D AND TECHNOLO-

GICAL INNOVATION

LOCAL FIRMS BACK-

WARD TECHNOLOGIES

AND WEAK TECHNO-

LOGICAL CAPABILITIES

LOCAL FIRMS

IMPORTATION OF

TECHNOLOGIES

FROM ABROAD

LOCAL FIRMS INABIL-

ITY OR UNWILLING-

NESS TO MASTERTHE IMPORTED

TECHNOLOGIES

LOCAL FIRMS CONTI-

NUING ADDICTION TO

THE IMPORTATION

OF MATURE

TECHNOLOGIES

LOCAL FIRMS

LACK OF GLOBAL

TECHNOLOGY-BASED

COMPETITIVENESS

LOCAL FIRMS

SATISFACTION WITH

DOING BUSINESS IN THE

DOMESTIC MARKET

LOCAL FIRMS LACK OF

DRIVE TO UPGRADE ITS

TECHNOLOGIES TOGLOBAL STANDARDS

FIGURE 3. MICRO VIEW OF THE VICIOUS CIRCLE OF PHILIPPINE

S&T AND ECONOMIC UNDERDEVELOPMENT AND DEPENDENCE

This vicious circle is the basic central problem of the Philippines that has

perpetuated the underdevelopment and dependence of our country's economy and

S&T system. It explains why Filipino-owned firms like NAPOCOR have remained

dependent on technology importation up to now, why the Philippines has failed to


18/31

18

industrialize and catch up, why the AFP has lagged behind its counterparts in Asia

in modernization, and why many of our neighboring countries have overtaken us.

With the identification of our country's basic central problem, its solution

becomes obvious. What needs to be done is to cut this vicious circle of S&T and

economic laggardness and dependence and to replace it with a virtuous circle of

S&T and economic innovativeness and competitiveness geared towards rapid

national economic and S&T catch-up and even leapfrog in certain sectors. To

achieve this, our national government will have to discard the failed and

discredited economic ideologies of neoliberalism and technoliberalism and adopt

an alternative approach which I will explain in the next section.

7. The Technonationalist, Catch-up Oriented, Capability-Based Approach

What I have been advocating for the past twenty-five years as an alternative to

the prevailing neoliberal and technoliberal approaches is the technonationalist,

catch-up oriented, capability-based approach that makes use of the precepts of

the successful East Asian models of industrial and technological catch-up and

development or what has been called the East Asian Consensus.

It is based on what has been called "technonationalism" which holds that

long-term strategic national interests should take precedence over short-term

comparative advantages on matters involving technology selection, acquisition,

and exploitation, that achieving technological self-reliance in strategic technologies

is a matter of national security, and that building up a countrys scientific and

technological capabilities to the highest world-class levels is a national imperative

for building a rich nation and a strong military. The essence oftechnonationalism


19/31

19

can be captured in the formula, Nationalist Culture, Advanced Technology,

which is adapted from the Meiji formula of Japanese Spirit, Western

Technology and which would seek to acquire, learn, master, and leapfrog the

latest technologies in order to advance national goals and interests.

This alternative approach is also catch-up oriented because it aims to

achieve rapid industrial, S&T, and economic catch-up, if not leapfrogging, in

certain selected sectors of the economy through the adoption of a development

strategy of cluster-based industrialization. This strategy would identify appropriate

industries to be created in every district of the country and then develop these

selected industries into globally competitive industrial clusters. The industrial

clusters to be developed could range from shipbuilding clusters, electric vehicle

clusters, gun making clusters, aerospace clusters, materials clusters, heavy

equipment clusters, machine tool clusters, electrical equipment clusters, furniture

clusters, pharmaceutical clusters, cutflower clusters, food processing clusters,

appliances clusters, nanotechnology clusters, information technology clusters, etc.

The approach is also capability-based because it is geared towards the

rapid development of the technological capabilities of Filipino-owned firms to

global competitiveness and the build up of the country's scientific capabilities to

world-class levels of excellence.

Moreover, it follows more or less the East Asian Consensus or what Lee

and Mathews (2009) prefer to call the BeST Consensus, after Beijing, Seoul,

and Tokyo the set of industrial catch-up precepts that has enabled East Asian

countries to achieve rapid industrialization, technological catch-up, and economic

progress or what has been called "The East Asian Miracle".


20/31

20

As expounded by Lee and Mathews (2009), the basic components of the East

Asian Consensus are

A.Creating the two principal agents of economic growth

1. Creating firms and building their capabilities (e.g., family-owned

conglomerates or chaebols like Samsung in South Korea or government

spin-out companies like Lenovo of China and Taiwan Semiconductor

Manufacturing Company of Taiwan)

2. Creating and relying upon the pilot or coordinating State agencies to

guide industrialization (e.g., MITI in Japan, Economic Planning Board

in South Korea, Central Economic Planning Board in Taiwan, and

National Development and Reform Commission in China)

B.Setting into motion the process of capability enhancement

3. Arranging firms to access and leverage advanced knowledge through

various modes of international technology transfer

4. Promoting export-based engagement with the global economy to disci-

pline firms and expand markets

5.

Targeting industries/technologies for (initially import-substituting) deve-

lopment

6. Sequential upgrading of the leading sectors and activities to secure

dynamic comparative advantages


21/31

21

C.Creating an economic environment in which capability development will

proceed

7. Building broad-based education, from primary education to tertiary

education

8. Creating a financial system that is catch-up friendly but cautious about

external financial liberalization

9. Establishing stable macroeconomic settings

10. Gradual phasing out of non-market interventions

8. The Nature and Importance of Technology Management

While technonationalism will serve as the basic strategy and principle for

attaining the twin national goals of a rich nation and a strong military, the

precepts, methods, and techniques of technology management will be needed to

implement the technonationalist program.

Although the formal recognition of technology management (or management

of technology) as a distinct field of management came about only in the last 25

years, the practice of technology management at the firm and national levels has

long been pursued as far back as the Industrial Revolution in the mid-18th

century.

In Asia, the Japanese have been using technology management competently and

effectively in their successful drive towards industrialization and technological

catch-up since the Meiji Restoration in 1868. Then following this Japanese model

of technology management, the Koreans and Taiwanese succeeded in


22/31

22

industrializing their economies, becoming export tigers, and attaining catch-up

competitiveness within 30 years.

Technology can be defined in a narrow sense as "the engineering knowledge

needed to create and produce a new product or process"or in a broader sense as

"the means for accomplishing a specific task". In terms of Michael Porter's value-

chain model of a firm (Porter 1985), we can define a firm's or organizations

technologies as the ways in which it performs its value-chain activities, as

depicted in Figure 4 and Figure 5.

Figure 4: Michael Porters Value-Chain Model of a Firm

FIRM INFRASTRUCTURE

HUMAN RESOURCE MANAGEMENT

TECHNOLOGY DEVELOPMENT

PROCUREMENT

INBOUND

LOGISTICS

OPERATIONS OUTBOUND

LOGISTICS

MARKETING

AND SALESSERVICE

PRIMARY ACTIVITIES

SUPPORT

ACTIVITIES

MARGIN

MARGIN


23/31

23

Figure 5: Representative Technologies in a Firms Value Chain

It is clear, therefore, that technology, broadly defined, pervades all the

activities of a firm or organization. And so a firm or organization can create

competitive advantages for itself --- whether in terms of lower costs through the

use of better process technologies or of distinct and better products through the

use of better product technologies --- by making appropriate technological

decisions for each value-chain activity as to the selection, sourcing, acquisition,

Information System TechnologyPlanning and Budgeting Technology

Office Technology

Training Technology

Motivation ResearchInformation Systems Technology

Product Technology Software Development Tools

Computer-aided Design Information Systems TechnologyPilot Plant Technology

Information System Technology

Communication System TechnologyTransportation System Technology

TransportationTechnology

Material HandlingTechnology

Storage & Preservation

Technology

Communication SystemTechnology

Testing Technology

Information System

Technology

Basic ProcessTechnology

Materials Technology

Machine ToolTechnology

Material Handling

Technology

Packaging Technology

Maintenance Methods

Testing Technology

Building Design/

Operation Technology

Information SystemTechnology

TransportationTechnology

Material HandlingTechnology

Packaging Technology

Communication System

Technology

Information SystemTechnology

Media Technology

Audio & Video

Recording Technology


Information System

Technology

Diagnostic and TestingTechnology


Information System

Technology

INBOUND

LOGISTICS

OPERATIONS OUTBOUND

LOGISTICS

MARKETING AND

SALES SERVICE

FIRM

INFRASTRUC-

TURE

HUMAN

RESOURCES

MANAGEMENT

TECHNOLOGY

DEVELOPMENT

PROCUREMENT

MARGIN

MARGIN


24/31

24

generation, exploitation, assimilation, improvement, or abandonment of

technology. The integrated and consolidated set of technology decisions for all of

the firm's or organizations value-chain activities will constitute the firm's or

organizations technology strategy.

Technology management at the level of a firm or organization can now be

defined as the strategic formulation and operational implementation of a

technology strategy that informs, and conforms with, the firm's or organizations

competitive strategy.

Technology management can be pursued through an exogenous innovation

cycle from the acquisition to the learning and mastery of an externally sourced

technology or through an endogenous innovation cycle from in-house research

and development (R&D) to technology commercialization or through a judicious

combination of these two approaches as depicted in Figure 6.

If we define a firm's competitiveness as its ability to get customers to choose

its product(s) or service(s) over competing alternatives on a sustainable basis,

then it is obvious that technology management is strategically important to

competitiveness for it can improve the firm's product technology (i.e., the design

of novel or better products) or its process technology (i.e., the efficient

production of products).

The first step in technology management is the technology audit of a firm or

organization, i.e., the assessment of the firm's or organizations strengths and

weaknesses for each of its technologies in terms of two measures: (1) the specific

technologys level oftechnological sophistication or the extent of its proximity

to the technological frontier or state-of-the-art; and (2) the firms or


25/31

25

organizations level oftechnological capability or the extent of its technological

mastery relative to that specific technology.

Figure 3: Technology Management Framework in Terms of anEndogenous Innovation Cycle or an Exogenous Innovation Cycle

The first step in technology management is the technology audit of a firm or

Figure 6: Technology Management Framework in Terms of anEndogenous Innovation Cycle or an Exogenous Innovation Cycle


26/31

26

Technological catch-up by a firm in a particular technology is the attainment

of innovative to creative levels of technological capabilities in the technology

through a process of technological learning, assimilation, and mastery from

behind-the-technology-frontier. Catch-up competitiveness can be defined

as the ability of a firm to catch-up technologically with the worlds technology

leaders and to compete in international markets. As explained by the Asian

Development Bank (2003), catch-up competitiveness is based on behind the

frontier innovations, involving constant improvements to process and products

(and their interfaces), supported by various kinds of technical and engineering

capabilities [and it] depends on entrepreneurship and educational provision, as

well as market-friendly institutions and sound macroeconomic management.

We can also use the term catch-up technology management to refer to a

firms effective selection, acquisition, development, exploitation, learning, and

mastery of the technologies needed to catch-up with the worlds technology

leaders in its chosen industry. In short, catch-up technology management is

technology management geared and oriented toward technological catch-up and

global competitiveness.

At the national or governmental level, technology management has been

defined by Khalil (2000) as

A field of knowledge concerned with the setting and implementation of

policies to deal with technological development and utilization, and the

impact of technology on society, organizations, individuals and nature.

It aims to stimulate innovation, create economic growth, and to foster

responsible use of technology for the benefit of humankind.


27/31

27

Thus, national technology management is concerned with the formulation and

implementation of national science and technology strategies, policies, plans,

roadmaps, and programs.

In the Philippines, I had for many years wanted to find a way, a medium for

advocating and propagating the concepts, principles, and methods of

technonationalism and technology management among Filipino businessmen,

managers, and government officials so that a new generation of technonationalist

managers, administrators, and policy-makers could be developed to counter the

prevailing economic ideologies of liberalism and technoliberalism.

In February 1995 I succeeded in pioneering the institutionalization of

technology management when I was able to get the U.P. Board of Regents to

approve the establishment of the Technology Management Center (TMC) in U.P.

Diliman. Since June 1996, TMC has been offering the countrys first and only

Master of Technology Management Program and admitting more than 60

students every year from various industries including the pharmaceutical,

information and communications technology, banking, fastfood, food processing,

electronics, transportation, energy, agriculture, etc. Since 1998, TMC has already

produced around 300 MTM graduates. Several of our MTM alumni are from the

Philippine Army and the Philippine Air Force.

I hope that the Philippine Navy will also send some of its officers to the TMC

in UP Diliman to get a Master in Technology Management. I also hope that the

Philippine Navy will establish its own Office of Naval Technology Management

which will be responsible for carrying out technology audit, technology

benchmarking, technology intelligence, technology foresight, technology


28/31

28

assessment, technology acquisition, and technology implementation for the

Philippine navys modernization program.

9. Conclusion

I will now close my talk by giving some concluding remarks that are centered

on the formula, Filipino Nationalism, Advanced Technology, which is an

adaptation of the Japanese Meiji formula of Japanese Spirit, Western

Technology.

If we just focus on the first part of the formula (Filipino Nationalism) and

ignore the second part (Advanced Technology), we get all these speeches and

writings about the need for patriotism, nationalism, good citizenship, good

leadership, and good governance which are heartening and spirit lifting but which

will not be of much value in defending our country or developing our economy

unless supported by high levels of technological capabilities for economic

development and national defense. Therefore, Filipino Nationalism Advanced

Technology = Technologyless Development a Poor Country + a Paper Army.

On the other hand, if we just focus on acquiring the second part (Advanced

Technology) without the guidance of the first part (Filipino Nationalism), we get

Technoliberalism and end up trapped in a vicious circle of economic and

technological laggardness and dependence that has allowed our Asian neighbors to

overtake us economically, technologically, and militarily. Therefore, Advanced

Technology Filipino Nationalism = Technoliberalism a Poor Country +

a Weak Army.


29/31

29

So what our country needs in order to achieve the twin goals of a Rich

Nation and a Strong Military is the combination of Filipino Nationalism and

Advanced Technology, i.e., Technonationalism with Technology Management.

In other words, Filipino Nationalism + Advanced Technology =

Technonationalism + Technology Management Rich Nation + Strong

Military.

I dream of a future scenario in which our country will have its own thriving

defense industries that will be able to produce Filipino-designed warships, aircraft

carriers, frigates, destroyers, robotic boats, unmanned aerial vehicles, stealth

submarines, robotic minisubs, supersonic fighters, torpedoes, cruise missiles, other

missiles of various types, amphibious combat vehicles, battle tanks, new weapon

systems, cyberwarfare systems, etc. Like all of you here, I dream of a future

Philippine Navy that has the capability to defend our territories and stand up to

foreign naval bullies.

This is not an impossible dream. This can be realized in 30 years or less if we

undertake a paradigm shift from economic liberalism and technoliberalism to

economic nationalism and technonationalism and use technology management to

upgrade our technological capabilities to innovative and creative levels, to carry

out cluster-based industrialization, and to transform our country to first world

status.

Thank you very much and good day!


30/31

30

REFERENCES

Asian Development Bank (2003), Asian Development Outlook 2003. Accessible

at: http://www.adb.org/Documents/Books/ADO/2003

Gapminder (2010). Accessed on January 3, 2010 at

http://spreadsheets.google.com/pub?key=phAwcNAVuyj1jiMAkmq1iMg

Khalil, Tarek (2000),Management of Technology, Boston: McGraw-Hill, p. 10

Lee, Keun (2009). "How can Korea be a Role Model for Catch-up Development?

A Capability-Based View." Research Paper No. 2009/34, U.N. University

World Institute for Development Economics Research (UNU-WIDER).

Accessed on January 9, 2010 at:

http://www.wider.unu.edu/publications/working-papers/research-papers/

2009/en_GB/rp2009-34/_files/81567730420417466/default/RP2009-34.pdf

Lee, Keun and John A. Mathews (2009). "From Washington Consensus to BeST

Consensus for World Development." Forthcoming inAsia-Pacific Economic

Literature in May 2010. Accessed on January 5, 2010 at:

http://www.managementmarketing.unimelb.edu.au/mcib/include/submitted_A

PEL_Lee_and_Mathews_aug_2009.pdf

Porter, Michael E. (1985), Competitive Advantage: Creating and Sustaining

Superior Performance, New York: The Free Press.

Posadas, Roger (2006). Technology Management and Catch-up Com-

petitiveness: What the Philippines Can Learn from South Korea and Taiwan,

Philippine Management Review , Vol 13 (2006), pp.42-69.

Posadas, Roger and Celso Roque (1994), The Philippines, in Technological

Independence: The Asian Experience (Eds.) Chamarik, S. and S. Goonatilake,

Tokyo: United Nations University Press, pp. 189-293.

Radosevic, Slavo (2009). "Policies for Promoting Technological Catch-up: A

Post Washington Approach." International Journal of Institutions and

Economics, Vol 1, No.1 April 2009 pp. 23-52. Accessed on January 7, 2010

at: http://ijie.um.edu.my/RePEC/umk/journl/v1i1/a2.pdf


31/31

Salazar, Chito (1998), Global Product Chains: Northern Consumers, Southern

Producers, and Sustainability: Semiconductors from the Philippines, Paper

Prepared for the U.N. Environment Programme.

Samuels, Richard J. (1996), Rich Nation, Strong Army: National Security and

the Technological Transformation of Japan. Ithaca, NY: Cornell University

Press.

Stiglitz, Joseph (2004). "The Post Washington Consensus." Working Paper Series.

The Initiative for Policy Dialogue, Columbia University. Accessed on January

3, 2010 at

http://www0.gsb.columbia.edu/ipd/pub/Stiglitz_PWCC_English1.pdf

Villegas, Bernardo (2009). "Business Matters: How did we get to where we are?"

Philippine Daily Inquirer(September 12, 2009).

******

RDP Technonationalism & MOT_Final

Documents

Transcript of RDP Technonationalism & MOT_Final