Technological capability is one of the factors that enable a country and its enterprises perform functions (especially innovation) critical to economic development and to gain an international competitiveness. Accumulating these capabilities, especially in developing countries, is considered to be a learning process which requires absorptive capacity. Murovac and Prodan (2009) described absorptive capacity as the ability to learn and solve problems. It facilitates absorbing existing knowledge, assimilating it
47 and in turn, generating new knowledge (Lall, 1992; Kim, 1997). This capacity underscores the importance of learning as a prerequisite to innovativeness (Jerez- Gomez et.al, 2005; Alegre & Chiva, 2008). Amara et.al (2008) described learning capability as those assets that enable firms to transform and exploit their resources in order to develop product or process innovations. Drawing upon existing literature, a number of authors (Cohen, 1995; Freeman, 1995; Lundvall, 1997), identify five modes of learning: searching, training, doing, and interacting. All of these are known to significantly influence the accumulation of technological capability in any organization.
The food and agricultural sectors has a high demand for innovative technologies such as machinery, technology systems, and network technology. In order to remain globally competitive, the ways in which technologies are adopted can make a real difference along the value chain from farming, irrigating techniques established, monitoring of soil and cultivating, storage of rice, food processing methods, and delivery of products (Suprem, Mahalik, & Kim, 2013). Modern process automation has been impacted by the advent of new technology systems and the agriculture and food sector is not an exception. When the relevant and appropriate information is considered at the best time and the appropriate machinery is utilized it can help agri-business has the potential to benefit inordinately (Chauhan, 2010).
Technological capabilities have been the subject of research since the mid-1980s. Since this time, a number of authors (Bell & Pavitt, 1995; Ernst, 1998; Kim, 2004) have defined this construct. For example Bessant, Francis, Meredith, Kaplinsky and Brown (2000) defined technological capabilities as the accumulated knowledge, skill, experience, and organizational base which enable a firm to acquire, develop, and use technology to achieve competitive advantage. As stated by Kim (2004), technological capabilities refer to an ability to make effective use of technological knowledge in production, engineering, and innovation. These capabilities enable a firm to create new technologies, and to develop new products and processes in response to their changing economic environment. By way of contrast, technological learning is a process of building and accumulating technological capabilities.
48 In the 90’s, a number of studies (Romijn, 1999; Bagachwa, 1992) highlighted the importance of technological capabilities in the rice milling industry, in developing nations. In an investigation exploring the relationships between technological effort and the acquisition of technological capabilities in the Pakistani small farm sector, Romijn (1999) found that outside technical assistance is important relative for other learning mechanisms (e.g., searching for new technological information, examination of competitors’ products when they are on public display) for developing complex products. In another study, Bagachwa (1992) established that millers who utilised inappropriate technology were less successful in terms of employment creation, output expansion, surplus generation, skill formation, economies of scale, and overall resource use. Ansal (1990) reported that firms in developing countries tended to undertake substantial efforts in order to achieve a wide variety of technical changes, accounting for a substantial proportion of productivity growth.
Research on the adoption and application of information technology in the agricultural sector can be regarded as an important area, given the complexities associated with global competition and climate change. Mishra and Williams (2006), observed that owners of companies that had internet access tended to be well educated, and to have off-farm business income, family members who were business partners and farms ideally location. Similarly, Burke and Sewake (2008) stated that the majority of agri- business users who access and surf agricultural websites for business purposes were more likely to have a higher educational level than their counterparts. The key technologies for agriculture and milling sector include handheld computers, intelligent mobile phones, portable computers and other related equipment (Höllerer & Feiner, 2004).
Owing to the limited research on the technological capabilities of Thai rice millers, a review of studies on their counterparts in other developing countries, such as Mexico (Gosen, 1995) and Pakistan (Romijin, 1999) reveals noteworthy findings, as does those emanating from South-East Asia. For example, in an investigation on the usage of technology of rice farmers in the Mekong Delta area, showed that there are a number of key technologies (e.g. machine harvesting, rice dyers) that benefit both farmers and the industry. The finding of Shaffril, Hassan and Samah (2009) and Samah, Shaffril, Hassan, Hassan, and Ismail(2009) supported those of Chi (2008), which stressing that low levels of education, weak perceptions of the value of technology, low teaching
49 capacities, lack of financial support, small land holdings, poor geographical conditions, disorganization, and limited capacity for expanding the workforce were barriers to the introduction of new technology to business.
The benefits of technologies such as information technology and website access, help agricultural farming entrepreneurs to seek related information, products, and services (Gakuru, Winters & Stepman, 2009). According to Barton (2003), internet provides farmers with the tools to communicate with other farmers and agricultural agencies across long distances. The internet is regarded as the most popular online service, being more useful than telephone technology. Farmers are able to access information through internet at any time, and to create networks between them, other farmers, and agricultural agencies. It also has the capability to help increase the opportunity to increase their agriculture productivity (Obiechina, 2004). Pickerrnell et al. (2004) highlighted that the internet has had a dramatic impact on agriculture. It offers farmers’ opportunities to improve their quality of life, to expand their market seek new customers, and access market price information, weather, or other relevant knowledge. Notwithstanding, technology holds a number of disadvantages. According to Chi (2008), some machinery is too heavy, which can create problems associated with mobility and use. Traditional farmers can enjoy the minimum cost with respect to their routines. For example, technologically-driven rice roasting helps the reduce grain loss from sun drying, but requires hired labour and operating costs. However, traditional farming relies on the sun for the same process. Technologies also involved complicated software programs, hardware, and other components that require time, knowledge, consultants, more workers, making financially enviable for small operators. Technology usage must be in line with the knowledge and capital capacities of the business. Entrepreneurs with limited funds and resources have fewer opportunities to introduce new technology into their business. In addition, not all businesses are able to use the same technology owing to employee numbers, level of skills and knowledge, and available funds (Shaffril et al. 2009; Samah et al. 2009). Furthermore, training and education, along with experience with rice milling can help motivate millers to learn and take-up new technology.
50 The poor rates of technology adoption in developing countries have been well documented, and there is empirical literature recognizing the importance of agricultural technology adoption in different contexts (Duflo, Kremer & Robinson, 2009; Conley & Udry, 2010; Suri, 2011). A number of these studies (Anderson & Feder, 2007; Foster & Rosenzweig, 1995; 2010) have referred to the control and effect of technology adoption and also its possible barriers. Determinants of adoption depend on contextual factors, the type of technology, level of education, personal preferences, financial support, risk preferences, and access to information and learning.
According to the International Telecommunication Union (ITU) (2009), over the previous 10 years, mobile phone usage has expanded rapidly in Africa, Latin America, and Asia, including Thailand. In 2008, there were approximately 4 billion mobile phone subscribers worldwide. Initially, adoption was primarily by wealthier, urban, and more educated residents, however, in recent years, mobile phones have been also been adopted by rural and urban populations, in some of the world’s poorest countries (Aker & Mbiti, 2010).
Adoption and innovation are complex social processes that are often over-simplified by innovation researchers (Van de Ven, 1986; Vanclay, 2004; Pannell et al., 2006). Innovation refers to the use of new ideas to improve ways of doing things in the face of institutional factors, regulations, and governance (Carruthers & Vanclay, 2012). Innovation researchers (Lockie, Mead, Vanclay & Butler, 1995; Guerin, 1999; Vanclay, 2003, 2004; Pannell et al., 2006) have tended to examine the experience of innovation only at certain points along the value chain. Most of this researcher has been within the managerial context and firm level. However, interest in the adoption of innovative technologies on the agricultural sector such as at the level of farmers and agriculture workers is becoming increasingly prevalent.
In conclusion, technological capability refers to an ability to use technology to achieve competitiveness in global markets. The key technologies for agriculture and the rice milling sector are handheld computers, intelligent mobile phones, portable computers, and other related equipment and applications. The highly competitive global environment has contributed to ever increasing high demands for innovation and technology in the food and agricultural sectors. In developing countries, including Thailand, the main barriers to introduction of new technology in the rice business
51 appear to be low levels of education, weak vision of the value of technology, and lack of financial support. Notwithstanding, there are a number of benefits associated with technology, such as providing efficient tools for communication, access to agricultural- and global-market price information, the provision of opportunities for farmers to improve their quality of life and products, and expanding new customer-bases through the use of the internet. Nonetheless, there are a number of disadvantages, such as high cost and skill requirements for workers.