ABSTRACT
This chapter focuses on micro-level empirical research. It explores how some successful firms in Sri Lanka, in a technologically constrained context, leverage exogenous partnerships to acquire technological resources and utilize local innovation capabilities to overcome technological limitations for sustained technological development. Based on qualitative firm-level data from the Sri Lankan manufacturing industry, the chapter argues that the acquisition of foreign technology from foreign partner firms provides a base for innovation to occur in local partner firms. The chapter concerns about diffusion-based innovation in the developing world by revealing the forms, the nature and the importance of technology management strategies for ongoing innovation capability in Sri Lankan firms. The possession of skilled human resources is a precondition for technological development and investment in human resources contributes to increased absorptive capacity. The chapter explores the case studies that illustrate how the technological learning process evolved as the firm life-cycle progressed.
