Technology Transfer



Technology Transfer Negotiations



Partially adapted



In today's era of systemic innovation and rapid change, strategic partnerships became flesh and blood of competitive business development. Technology strategy formulation and technology selection require holistic thinking and systems approach to business management. Even product sales operations are not about buying or selling something a bit cheaper anymore, these are strategic decisions nowadays.

Transfer of technology is one of the most sophisticated business operations requiring matching of prospective buyers and sellers by many parameters. Building up lasting partnership relationships for the mutual benefit is extremely important in this type of business. Thus technology transfer negotiations leading to a wise agreement should not be seen as simple bargaining about the cost and terms, but rather a process of successful business development by two strategic partners.






Arriving at a satisfactory business relationship requires two things:

1. the preparation of a balanced and comprehensive agreement between parties, and

2. civil negotiations that aim to achieve mutually beneficial results for all of the parties involved.

Being well-informed, building an effective negotiating team and communicating well with members of the other team will affect the success of the negotiations. Various steps to be taken at a given stages of the negotiation process are recommended. Effective, cooperative negotiations make for mutually beneficial relations and the long-term satisfaction of the parties to the agreement.





A technology transfer agreement that results in a satisfactory long-term relationship between two or more parties is one in which the parties recognize that the agreement must provide benefits for each. Once this principle is accepted by negotiators, the process moves more smoothly. It can be enhanced in two ways:

a. by preparing a proposed agreement between the parties to serve as the basis of negotiation that is balanced with respect to their mutual and conflicting interests as well as comprehensive, and

b. by conducting negotiations to arrive at a mutually acceptable final text that gives each party the appropriate rights and obligations.

The manner in which negotiations are conducted will also help ensure a successful end result. Negotiations should

a. obtain and master all the relevant information needed to correctly present their interests and options,

b. develop the internal communications that will mould each party into an effective team, and

c. utilize approaches and techniques that facilitate communication between the parties and develop mutual confidence and trust.

This guide will discuss the various steps that need to be taken at each stage of the negotiating process. It will elucidate the elements that maximize the chances of success, not necessarily in terms of what provisions are incorporated into the contract but by how successfully the project ultimately evolves, and by how the relationship between the parties becomes cooperative rather than adversarial. The cumulative effect of those elements constitutes what is generally referred to as the dynamics of the negotiation process.

Certain points stressed here should be kept in mind throughout the planning and execution stages of negotiations:

▪ When making international agreements, it is essential that the culture of the other party's country be studied carefully to assure that your own party's understanding of the other's arguments and interests are clear and that yours are clear to them. It is just as important to learn their customs to avoid embarrassments or insults.

▪ For any kind of agreement, national or international, learn all you can about the other party(s): its style, preferences, performance, financial condition, ethics, expectations from the deal etc. Separate assumptions from facts. This will help in formulating your own objectives and negotiating strategy.