This paper discusses the automotive industry cluster that can be profiled as a Technology Colony and how a strategy for building technological capability can be determined. The industrial network a firm operates in influences its technological capability. Networks differ in dynamics because of the differences in actors and the nature of interfacing between them. A Technology Colony can be defined as a concentration of technological based activities in the later phases of product lifecycles, without the necessary supportive technological based activities in the earlier phases of the lifecycles. In industrial clusters where the majority of the firms exhibit this type of technological profile, the network dynamics are different. In such cases the building of technological capability need to be planned according to these characteristics.
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