Question

7. A feasibility study evaluates the project's potential for success. One of the feasibility studies is technological feasibility. What need to be considered in technological feasibility? Please give one example to explain.

Answer 1

I am taking an example of Construction Project of High Rise Building:

So basically technical feasibility is considering the technicality of the Project i.e. manufacturing process, material input and outputs, product mix, plant capacity its location and layout, machines and equipment. The choice of technology should be taken in Consultation of the technology experts but the responsibility for the decision making should rest on the top management. Any wrong decision has negative implication towards project which is often irreversible as technological development requires large capital expenses thus it will directly affect the competitiveness of the firm. Some of the technology required in any construction project are

• Tower Crane
• Batching Plant
• SRP
• Hammer & Dumper etc
• Construction Methodology i.e. Conventional or Mivon or any other

1. Selection of Technology by asking the following questions

• What will the technology do?
• What will it not do?
• What inputs will it require?
• What will it cost?
• How certain are the above?

2. Sources of Technology:

The company can inhouse the technology or it can outsource the technology based on the risk associated with it. The company can own a technology if that can be used over a period of time or it can acquire that from external source for a specific time as per the project as mostly the technologies are with high cost.

Issues Involved with Technology Acquisition:

• Identification of the technology as per project specifications
• Duration for acquisition
• Components of the technology
• Uncertainty of the technology
• Cost of the package
• Material inputs
• Sources available

3. After identifying the Technology & its Sources the following points are describe in Technology Transfer Agreement before final selection.

• Definition of the Product- Its Specifications, Operation, maintenance and other important Details.
• Technology Package- based on the evaluation of the specification
• Payment Terms- as per mutual understanding.
• Duration- Time for the Technology is being taken.
• Access to improving in technology- that many come in suppliers or buyers end.
• Rights and obligations- of both buyer & suppiler
• Indemnifications- the supplier indemnifies the buyer from any infringement of the third party's rights protected by a patent.
• Exclusivity & Non Exclusivity- Maintenance or any other points related to the technology.
• Force Majeure- In case of uncertainty or gods act.
• Arbitration- In case of any dispute arise in future.
• Governing Laws- The local by laws in case Arbitration process fails.

The above process is said to be under Technical Evaluation or feasibility.