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Proceedings of the Technology Promoters Workshop Subroto Roy On December 10 and December 11, 1998 a workshop of Technology Promoters was held in New Delhi. A report - The Technology Promoters Workshop was organised to verify the various business models and suitability of these models in the context of various Technology Promoters. It was also envisaged that the role of technology promoters and facilitating organisations will become more clear during the workshop. Various technology promoters were invited for the workshop in New Delhi on the 10th and 11th of December, 1998. The invitees included promoters from the building material sector, technology suppliers, consultants, advisers, SDC and SKAT. D evelopment Alternatives (DA) has been engaged in the promotion of Sustainable Building Technologies through decentralised production and marketing systems. For the past 15 years, it has been working on a range of cement based technologies like Micro Concrete Roofing Tiles, Ferrocement Roofing Channels, Stabilised Compressed Earth Blocks and Concrete Blocks.Current level of technology diffusion has indicated that widespread impact of technology dissemination is possible if commercial partners with a business interest are engaged in technology promotion. These commercial partners would act as technology promoters in the open market on a purely commercial basis. It is envisaged that commercial partners will derive leverage from their existing work experience for the various aspects of technology dissemination such as market development, enterprise development, training, production and marketing of the products and equipment. Initially, the Building Materials Project of DA will guide and support their initiatives to achieve the objective of technology promotion. Later on, technology promoters will either market equipment or products independently. A few promoters will take up the role of marketing equipment as well as end products. They will also provide services such as training and latest know-how in technology on a commercial basis. Workshop Objectives a) To verify different business models and define the role of each type of Technology Promoter b) To discuss and evolve strategies for technology promotion and define the role of market development as the key driver for technology promotion. c) To develop strategies for accelerated engagement of technology promoters through interaction with key promoters and consultants. Findings of the workshop Participants confirmed that to catalyse the process of technology promotion, market development at the technology level as well as at the product level is imperative. Large companies source new technologies and perform the crucial role of market development for the product using their own financial and management resources. Since they enjoy a monopoly over the technology and the brand, they reap the fruits of the market development within a short time. On the other hand, the building technologies considered at the workshop, were being marketed at a decentralised level since the scale of production is small and decentralised. The effort required for marketing the products is within reach but not attractive enough for large companies. Not many large companies are coming forward to invest in this sector, even though the market is huge. There is a crucial need for regional market development of building products. Hence crucial regi-onal players are product marketing com-panies, with an estab-lished brand name and a sufficient market reach at the local level. These product-level marketing companies share common characteristics such as :- 1. Association with a strong brand name; 2. Access to a large customer base; 3. Links with an established dealer or distribution network; and 4. Strong local presence in the building materials business. Acceleration of the process towards large scale dissemination of technologies will require finding such product level promoters in large numbers and providing innovative support for widespread product awareness leading to market demand. Thus, a framework is required where some of the organisations can be placed, based on their potential roles and synergies can be built into their work. These role players can approach various facilitating organisations for leveraging supports for technology promotion. The framework consists of:
I. The Network The network consists of the market, product level promoters, technology promoters and technology providers, consultants organised in the following manner: The user is approached and serviced with the building product by product level companies. In the case of rural areas, there are micro entrepreneurs and building centres, who produce the product and provide services such as roofing. In the well developed urban markets, there are indeed product companies who operate in the market, which consists of end-users who will purchase the end product and services. End users can be single house owners, industrial users or institutional clients. The scale of operation is medium for local companies to large companies, who market nationally. A franchise company like TARA-BKF Rural Technologies (TBRT) will also fall in this category. All these can be classified together as product level promoters.The main characteristics of the product level promoters are strong brand name, presence in the local market and a solid customer base. It is clear that technology promoters will need to engage product-level promoters by customising and packaging the services for product-level promoters. The services can consist of identification of promoters, financial packaging of technology packages, sourcing technologies facilitation of training and marketing support and access to finance. Services will differ and be modified, based on the technologies and the promoter. The ultimate aim of technology promoters is to operationalise selected product-level promoters. In the case of franchising companies as Technology Promoters, creation of a brand image for supporting product level marketing will be a very crucial service provided to franchises. Providers or consultants are knowledge banks of technology and value added services like marketing and finance. II. Responsibilities of different role players of the network The chief responsibilities for organising the network, in the initial stages, are likely to be undertaken by the technology providers and their partners. The partners identified to date include Development Alternatives and associates who are technology- facilitating organisations and consultants. They will, together, identify the technology promoters and will transfer the knowledge base and provide technical consultancy. They will also help promoters in capacity building, training and formulating a strategy for engaging product level promoters. Technology promoters will identify product-level promoters and provide them with customized packages of technology, financing and marketing supports. Product-level promoters will manufacture the products directly or through their franchises and will sell their products in the market. They can also provide roof and wall installation services. Users in the market will purchase the product and will pay for both the product and services to the client. The function of market development will be that of the product level promoters. They may ask for compensation from the equipment manufacturer for sharing the product marketing company's brand name, which ultimately will benefit the equipment manufacturer in being able to sell more machines as the market size increases. III. Possible Synergies Synergies are possible between the technology promoter and product marketing companies. For example, TBRT (as a technology promoter) will source and finance equipment for the entrepreneur. It will also provide training and will buy back partial production of the end product from the entrepreneurs, who are called franchise producers. As a product-level promoter, it will create a brand name and will network with existing dealer-distributor network for marketing its products. This will help other franchise producers to sell their balance production capacity. Similarly, product level promoters can source their production from various small entrepreneurs and market them under a common brand name, thus acting as a technology promoter by providing technology and marketing support. They can also assist entrepreneurs in getting finance or can directly finance them. IV. Emerging role of regional network for acceleration Networking is required at the regional level between technology providers, consultants and technical consultancy organisations for packaging the technologies and services for technology promoters. The network will work on getting leverage from various facilitating organisations (for example, HUDCO, BMTPC, National Housing Boards and Development Authorities). It will pass on the benefits to technology promoters, who in return will use these benefits for engaging product-level promoters. Thus as a next step, Development Alternatives has to find product-level promoters in already identified potential regions. For that, it has to network with the technical consultancy organisations like the Maharashtra Industrial and Technical Consultancy Organisation (MITCON) for specific regions and develop business models for such product level promoters. During the initial stage, DA (with its partners) has to perform the role of a technology promoter, while continuously searching for technology-level promoters who will guide the process of technology promotion when the technology becomes commercially viable at each and every level of the above presented framework. q
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