Licensing Honeywell to enter airborne equipment (1961)

Whose demand do you put the borrowed technology on?

The 1961 technical assistance agreement is a long way from any story of winning on proprietary technology. In the connector industry of the day even the largest firms could not produce on their own technology, and tie-ups with foreign holders of it were simply the precondition of being in the business. What the company chose, twice over, was a sequence: stand first in the position of import agent or repair contractor, learn the technology there, and only then move to its own product. It is unglamorous, but as a way for a firm with little capital and no record to make a place for itself in an advanced field, it can be seen as rational. That the technology taken in from Honeywell arrived ten years later as an inertial navigation system of the company’s own is evidence that the sequence worked.

What demand the borrowed technology was placed on, however, has been re-chosen at every turn. Airborne equipment is supported by the national budget and priced high, but its volumes do not grow; the scale was built by connectors for consumer equipment. Sixty years on, the aerospace business closest to the founding lineage does not reach a tenth of revenue, and from the year to March 2027 another of the three pillars will cease to be an independent segment. Even where the technology has a single origin, the weight of a business keeps shifting as long as the demand has several — the 1961 choice brought that question into the company early, and it has faced it ever since.