From Idea to Implementation: Major Deterrents to the Technology Commercialization

Commercialization is one of the challenges that the science world faces today. The main aim of the science world is to serve people either in solving their problems or in improving their current life style. However, not every successful scientific research or invention can make it successfully to a proper commercial platform. There are dozens of patent registrations every day from which only few can make it to the market. In this post I deal with the major obstacles that inhibit the commercialization of technology.

Start-up Strategy

Startup strategy accounts for the low rate of commercialization of technology. According to Sara Sarasvathy, there are two main strategies for startups: causation and effectuation.

In causation you have a set of available resources and means to create a specific goal before implementation. In other words, when developing a blue print for the business, you consider all resources that you need to create that specific goal and start the implementation only when you have everything in hand.

One of the main problems during seed stage is that entrepreneurs wait too much to acquire the required resources. The lack of required resources is surely the most important problem and accounts for most of the delays in startups during seed stage. The delay is sometimes so much that the business idea never comes true and remains as it is. Financial constrains is the major one in all stages of entrepreneurship that results in more limits such as lack of human resources. Some people are not eager to start their idea with some strategic partners to overcome some of their startup limits of resources. Moreover, people who choose the causation strategy are perfectionists who want to do things completely when everything is ready, thus they have no other choice than waiting for required resources. As a result, most of the time the business idea just stays in its creator’s head forever, just because they tend to causation strategy. I met some people with this approach who failed to bring a business idea into reality; their business ideas and innovative research results never came to an implementation phase. They did neither share their business ideas with others nor were they able to implement them themselves.

Effectuation on the other hand, considers the resources in hand and tries to create a particular result with what is in hand at the moment. People with entrepreneurial logic mostly approach the effectuation strategy. They do not wait for all required assets and resources; instead, they start with whatever they have using the affordable loss strategy. They know that they might fail, but they have a comeback strategy for their failures. They try to bootstrap their finance or find strategic partners. Effectuation is the strategy of most successful entrepreneurs and is the borderline between managerial thinking and entrepreneurial thinking. The manager waits for all resources to be available and then creates a result with what is in hand, but the entrepreneur starts with whatever is in hand.

The wrong approach between effectuation and causation is one of the major problems in the commercialization of technology. When the inventor waits too much and overlooks the duration of time in order to have all resources before takeoff, the idea remains as it is.

Entrepreneurship is neither a science nor an art. It is a practice.

– Peter Drucker

The approach in choosing either effectuation or causation depends much on the entrepreneur’s character than anything else.

Entrepreneur as CEO

Some entrepreneurs believe that they have to stay as CEO of the company and do not agree on putting a CEO in charge, because they want to control everything themselves. But the problem lies in the fact that most of these technology inventors come from a technical background and lack sufficient business know-how to lead a company successfully. Furthermore, they are quite busy with some other affairs (e.g. research, job, university study, etc.) –which is most of the time their main priority – and cannot dedicate their full energy and time on their emerging startup. Consequently, there will be a big gap in the performance during seed stage and there will be no startup activity either. After one year of working with one of my clients on the seed stage of his company, although he had a good technology idea at the time, he never found enough time to push the business forward. The company still exists only on paper and never got operational. I bet you will find more of the same example if you just look around yourself or just research the registered companies in your region. The reason is that the entrepreneur wants to stay CEO, either because of financial constrains or lack of trust in others.

Furthermore, the lack of business knowledge can also harm technology startups in future. Entrepreneurship requires a CEO more than just technicians who just had some business coaching sessions in incubators or attended some workshops.

A haphazard business model is also another problem that entrepreneurs face due to the lack of a leadership and business expertise. Most technology inventor have been doing research and technology development and had less time to learn business concepts, in particular in the real business life. The income generation method is one of the most important aspects and most popular mistakes that technology entrepreneurs make in their startup. When they insist on being CEO without having a good advisors they are more vulnerable to fail for their business model. The business model is the method of income generation and is crucial for the company to create value.

The golden eagle entrepreneur tends to effectuation strategy by nature. He/she takes all resources in consideration and tries to make the best out of them. The golden eagle entrepreneur uses the creative solutions for solving the problems that arise from lack of available resources. The golden eagle entrepreneur takes action and does not wait for all resources and perfect playground. The golden eagle entrepreneur soars into the sky with his/her own talent and uses creative solutions.