How Technology Management Affects the Development of Service Industries: A Case Study of China's Telecommunications Industry

China's telecommunications industry has been appreciably growing since many years and China now has world's largest telecommunications networks not only in terms of network capacity but also number of subscribers. This paper, aiming at investigating effects of technology management and technological capability on industrial development, lays emphasis on illustrating relationships among technology management, technological capability and telecommunications industry development and tries to explore how technology management affects industrial development. The paper argues that technological capability has the most significant effects on telecommunications industry development; technology management has more significant effects on telecommunications industry development than labor and capital. Technology management can exert influences on telecommunications industry development through technological capability, and by interacting with technological capability, effects of technology management are magnified. In the same way, technological capability has not only direct effects on industrial development, but also significant indirect effects by interacting with technology management. The findings in the paper have important managerial implications in terms of promoting technology management and technological capability for telecommunications industry to gain competitiveness, and improving synergy of technology management and technological capability to foster the development of telecommunications industry. The paper also contributes to the existing research in two different ways. First, the study demonstrates the effects of technology management at industrial level. Second, the exploration of technology management and technological capability and their interactions describes dynamics of the development of China's service industry from a new and complementary perspective.