More Value at Upstream Layer in Technology Pyramid

Technology is the leader of the business world. And driving through a constitution. Unlike the traditional political structure, the algorithms constitution written by engineers, scientists, parliamentarians, etc. and not the politicians.

International competition is an important part that has the best technical team for the best writing, in this case, the algorithms, which consist of patents, technical processes, tools, etc. As a nation develops, it takes, apply and disseminate the contents of this Constitution, but increases the life of its citizens. The most innovative nation pursues a more perfect the present Constitution.

Economists have shown a correlation between the Knowledge Economy Index (KEI), productivity and living standards. The challenge for every country is improving the number KEI. Doing that means good education, economic system and other variables that contribute to improving the employability technology.

The age of natural resources dominate the global market and industry has disappeared. What matters now is the creation of knowledge and its application. Some countries, while others are consumed. But the wealth is concentrated in the creative phase and nations that focus on consumption, without the technology will not succeed.

Even with abundant natural resources, which in many cases, the consumer countries can not be processed independently without the knowledge of this process of limited partners will not be changed without the technology to create national wealth.

On this basis, I have two separate layers, where countries compete with the technology and use it as layers of upstream and downstream. It's like a pyramid, where two layers, the intermediate is at the bottom of the sit up on top. What's happening here is that some countries focus on the layer below, while others combine layers upstream and downstream.

The most advanced nations combine the two layers in its quest for international competitiveness. Technology offer roadmap, looking to the future and plan to take advantage of that technology brings. They create and develop things and in the 21st century will be classified as knowledge-based economy. In these countries there is continuity and planning of the technology behind the other.

For other countries, mainly developing, competing in the technology pyramid, especially in the layer below. They lack the know-how and technology to create things to commercialize intellectual property. Nations are not technology driven, rather than commodities. They are sensitive to shocks and trade tend to be economically vibrant. They are not capable of creating wealth through technology and consumer participation in pyramid or individuals.

Let me illustrate this with Nigeria, where it talks about oil. In the petroleum industry, upstream and downstream sectors are. While focusing on rising crude oil exploration, distribution and subsequent marketing.

The money is in the upstream sector, one of the main reasons that foreign partners have concentrated on them. That's where knowledge creation is made and used in industry. I'm careful to say, without the knowledge of partners in Nigeria to help you explore crude oil, Nigeria is not my product. Verdict: the oil will have tangible economic and practical.

This follows a pattern of water from the village below, but no experience in drilling water used for cooking and drinking. That is the problem of anchoring the national strategy in the middle tier. The lack of inventiveness.

In Africa and many developing countries, where they embraced ICTs rarely know there are more valuable than that offered by ICT. Sure IT have many developing countries to improve their business processes, tools and people to improve. They are so enthusiastic about the powers of communication faster and faster. They enjoy the wonders of email, Internet and cell phones and more. These experiences are mainly in marketing, distribution and installation of ICT systems. They rarely and can only play in the layer below.

There are economists point out repeatedly, the ICT has brought innovations to the economy. I agree, is connected to the innovation of ICT in several areas. However, the good news is that more benefits as they climb the pyramid to the top layer. By not creating the technology, technical and economic benefits our limited and this will not change until we get up in the pyramid.

Although this point can be illustrated with any technology, I will use ICT as usual and familiar to people. I have already indicated, the point where the oil industry, where many developing countries that depend on petroleum refining technology from developed countries to extract the oil. Even when the development of technologies for distribution, upstream idea will succeed. Nations more money to license technology to the upstream level in relation to the river below.

Back to ICT, the upstream level involve the design of computer systems, cellular phones, routers, device drivers and other infrastructure to ensure that the ICT revolution. Instead of importing the latest mobile phones, we will consider how to design. In 80% of developing countries, where mobile technology is used, less than 2% of the new technologies are designed and manufactured.

Yes, there are companies that distribute and sell these gadgets to get fringe benefits. You can import a laptop from China at $ 500 and sells to its customers at $ 650. Because the barrier to entry is so weak, the margins are small. Everyone is selling and there are shops for all. They are technology companies to their nations, as they can load the software and configure the networks and get the laptop working.

Compare this with giants like Intel and AMD to have a piece of sand (silica) and the process. In the end, that piece of sand, for example, a $ 1 can be sold for $ 3,000 by the knowledge to transform the sand into a microprocessor. That is knowledge and the best of human imagination and creativity. Is technology in the upstream level, and that is where the value is.

United Nations win in the upstream level, because the sales margins are so large, because the niche products and in most cases with few innovative internationally. It is not only trade or margins. Upstream Technology Layer a good job, both in developed and developing countries. Some of the best jobs in Africa in the upstream oil giants where the rules of technology. To create good jobs for citizens enviable. They have the money to spend and to eliminate other areas of the economy. They have jobs that bring honor and dignity and using your brain to shape the world.

You can use the same case for pharmaceutical companies that blend the elements, compounds, etc for the medications. Some drugs are very expensive, but the ingredients are cheap. People pay for the R & D in the development of that drug. In developing countries, focus on the marketing and sale of drugs. Like oil, ICT is all about the intermediates. Why Big Pharma, the margin of 1000%, these entities may be ordered only 6% margins.

So basically, in this century, there are opportunities for nations. For developing nations, whether they will compete in the lower layer of the pyramid, they will find it hard to get because the competition is really synonymous with technology. More risk, more knowledge and more value to rise. And we have to get there.