MGMT 2145 Midterm

economies of scale

As a company's product volumes increase, the cost to produce declines relative to the price of their goods and services.

factor-driven economy

Economies that rely on unskilled labor and the extraction of natural resources for growth. Businesses are created out of necessity.

corporate ventures

Entrepreneurial ventures inside a large corporation.

indirect competitors

Companies that serve the same customer needs but with different resources as in substitute products, services, or distribution channels.

direct competitors

Companies that serve the same customer needs with the same types of resources.

doctrine of fair use

Copying of copyrighted material for a "limited and transformative" purpose such as criticism, parody, and education

value-driven model

Entrepreneurs want to create premium experiences for their customers that typically involve personalized service and luxury facilities and products. Customers for this model are value conscious.

incremental innovations

Incremental innovations are built on existing technology and typically represent small improvements.

gross margins

Indicates how much money is left to pay overhead and make a profit. It is found by dividing gross profit by sales.

patent

(n.) exclusive rights over an invention; copyright; (v.) to arrange or obtain such rights; (adj.) plain, open to view; copyrighted

disruptive or radical innovations

Innovations that make obsolete previous technology or ways of doing things.

trademark

A brand that has exclusive legal protection for both its brand name and its design logo, slogan, container

channel intermediary

A company in the value chain of an industry.

incubators

A company that helps startups get going by providing guidance and some resources.

industry

A grouping businesses that interact in a common environment as part of a value chain that delivers a particular good.

market

A grouping of customers for a particular good or service.

trade secret

A novel formula, device, idea, process, pattern, or compilation of information that gives the owner a competitive advantage in the marketplace and is kept in a reasonably confidential state.

business model

A plan for how the business will create value and make money.

design thinking

A process and approach that looks at the world from the customer's perspective.

minimum viable product (MVP)

A version of a product that contains just enough of the functionality and value proposition to attract early adopters who provide feedback help with the development of the final product.

beta version

A version of software that is made available for testing outside the company.

Select all the following that accurately complete the following sentence. Design thinking is a: a. process to gain empathy with customers. b. method for drawing ideas. c. process that involves experimentation. d. technique that requires collaboration.

A, C, D

keystoning

Any item selling at twice the price it was bought for or cost. 100% markup

first sale doctrine

Anyone who knowingly purchases a copyrighted work can sell, display, or dispose of the work but not make new copies without infringing the copyright.

value chain

It consists of all of the companies that contribute to the development and distribution of products and servicse starting from raw materials to distributors and retailers. Each contributes value to the product and marks up the price accordingly.

intellectual assets

Knowledge documented in a physical form and that is easy to communicate and share.

discovery theory

Opportunities come from external factors in the market or industry such as changes in customer preferences.

intellectual property (IP)

Ownership of innovation by an individual or business enterprise; includes patented, trademarked, or copyrighted property. the highest form of protection and the most valuable.

Digitial Millennium Copyright Act (1998)

Prohibits the falsification, alteration, or removal of copyright management data on digital copies. It is a crime to circumvent and encrypted work without authorization.

economic core

Small businesses such as shops, restarants, and professional service businesses.

intellectual capital

Tacit knowledge that is not codified in any formal way.

visualization

The ability to paint a picture of what you're seeing through graphics and words.

counterfeiting

The deliberate copying of something

cost-driven model

The emphasis is on keeping costs as low as possible because margins are narrow. Entrepreneurs using this model are price conscious.

return on investment (ROI)

The measurement of the gain or loss to the entrepreneur from investing in the business. net profit/cost of investment x 100

knowledge economy

The period beginning in 2000 where the primary resource was knowledge raither than raw materials and physical labor.

product life cycle

The period from the birth of the product to the point at which it is obsolete or has no further value.

feasibility analysis

The process used to test a business concept. testing, evaluation, and validation of the business model

industry architecture

The structure of an industry and how it works.

gazelles

These are high-impact businesses whose sales typically double over a four-year period.

secondary sources

These are information sources that originate from others such as journals, reports, and studies.

accelerators

This is a form of school for startups that is supposed to speed up the entrepreneurial process.

primary field data

This is data you gather through direct interviews or research studies that you conduct.

primary market

Those customers who have the most need for what is being offered.

creation theory

You create opportunities by your actions, reactions and experiments.

After you have generated ideas for needs or problems and you want to narrow the ideas down to the best, what are the most effective approaches to judging ideas? (Select all that apply.) a. Identify the positives of an idea first. b. Use predefined criteria to establish standards for selection. c. Kill the crazy ideas quickly. d. Don't rush to a conclusion.

a, b, d

The entrepreneurial process provides many benefits to the economy. Which of the following are two of those benefits? Select all that apply. a. Entrepreneurs create new industries. b. Gazelle businesses provide stable growth. c. Small businesses create the most jobs. d. Technological change spurs economic growth.

a, d

When you are trying to generate ideas for problems or solutions in a group, which of the following should you do? (Select all that apply.) a. You should start brainstorming ideas as fast as possible as a group to benefit from group think. b. You should capture even the most outlandish ideas. c. Keep in mind that quality is more important than quantity of ideas when brainstorming. d. After brainstorming, combine ideas to create new ideas.

b & d

What distinguishes an entrepreneurial venture from a small business? Select all that apply. a. The business is part of the "economic core." b. The business has a goal to grow. c. The business creates new value. d. The business owner wants to make a living.

b, c

Entrepreneurship is a way of thinking that is opportunity-focused, risk taking, _____, and growth oriented. a. responsible b. innovative c. leading d. managing

b. innovative

reflects the strategic decisions and trade offs that entrepreneurs make to earn a profit

business model

The decade of the 1970s was characterized by: a. the shutting down of large mills and factories and the rise of service companies. b. more jobs being created overseas and an increasing lack of job security. c. the technology revolution, international competition, and macroeconomic turmoil. d. unrestricted growth and huge companies.

c

Which one of the following statements about innovation and commercialization is most accurate? a. Innovation is the process that moves the product to the marketplace, while commercialization is about starting a business. b. Innovation is the process of creating something new based on existing technology, while commercialization is a way to differentiate a product in the market. c. Innovation takes a novel idea and turns it into a product or service, while commercialization is the business process that moves an innovation from the lab to the market.

c

Which of the following are new trends as of 2018? Select all that apply. a. Big data b. Lean startup c. Artificial intelligence d. Digital twins

c, d

keeping cost low as possible because margins are narrow

cost driven model

cost that produce the biggest impact on the cost structure

cost drivers

answers the question- how do you deliver the benefit to the customer?

distribution channels

industry lifecycle: shakeout

dominant firms emerge as weaker firms leave

industry lifecycle: decline

falling demand; products being dropped

a tool that is used to assess and reduce risk at startup

feasibility analysis

rent

fixed cost

provide an indication of how much room there is to make mistakes

gross margins

formula for gross margins

gross profits/sales

a grouping of businesses that interact in a common environment as part of a value chain

industry

industry lifecycle: differentiation

intense product differentiation

industry lifecycle: growth

many competitors, healthy profits, some acquisition of small companies

industry lifecycle: emerging

many new entrants. no dominant players

is defined by customers- those who pay for the benefits of the products or service

market

industry lifecycle: maturity

market is becoming saturated; prices and profits begin to fall

represents the most timeliest information within a particular industry

primary field data

customers that have the most need for what you're offering

primary market

various ways that you plan to make money

revenue model

copyright

the exclusive legal right, given to an originator or an assignee to print, publish, perform, film, or record literary, artistic, or musical material, and to authorize others to do the same.

economic life

the time during which a product can generate revenue.

porter's five forces

threat of entry, threat of substitute, supplier power, buyer power, and competitive rivalry

creation of premium experiences for customers- personalized service-luxury products

value driven model

the benefit that the customer derives from the product or service

value proposition