BUSI 400: Chapter 12

Which of the following are examples of staffing practices for innovation that are counterproductive? (Check all that apply.)

A climate where innovation teams are treated as second-class citizens A team consisting of volunteers who want to work on projects they find interesting A team consisting of strong employees taken from the company's core business

Which of the following are true about managing the pace of incremental innovation? (Check all that apply.)

Development is usually at a fast pace to get innovations out at a planned pace. Milestones are often driven by stringent goals and deadlines. The project time may be six months to two years.

What is the purpose of real options analysis in entrepreneurship?

It is used to suggest a path that companies can use to manage the uncertainty associated with launching new ventures.

Which of the following statements about corporate venturing efforts are correct? (Check all that apply.)

Just over 50% are financially successful. Companies expect higher returns from new corporate ventures than normal operations. In terms of a risk-return trade-off new corporate ventures often fall short of expectations.

Which of the following statements about innovation are true? (Check all that apply.)

New technology is among the most important sources for innovation. There can be innovation made to human resources, marketing, and a firm's infrastructure. It must involve using new knowledge.

Which of the following statements about competitive aggressiveness are correct? (Check all that apply.)

One technique is to find successful business models and copy them. It is a strategy best used in moderation. One technique is to enter markets with drastically lower prices.

Which of the following statements about proactiveness are correct? (Check all that apply.)

One technique is to introduce new products or technological capabilities ahead of competitors. It puts competitors in the position of having to respond to successful initiatives. It is a forward-looking strategy.

Which of the following are true about managing the pace of radical innovation? (Check all that apply.)

There is often open-ended experimentation with time-consuming mistakes. The project timeline is typically as long as 10 years or more. It has long periods of exploration in which experimentation makes strict timelines unrealistic.

Which of the following statements about process innovation are correct? (Check all that apply.)

They are associated with an overall cost leadership strategy. Firms can often improve by drawing on new technologies and the organization's experience. Process innovation is likely to occur during later stages of the industry life cycle.

Which of the following statements about product champions are true? (Check all that apply.)

They help promote the concept to upper management. They help find resources for new product ideas. They are often needed to take charge of internally generated ideas.

Which of the following statements regarding risk taking are true? (Check all that apply.)

Corporate entrepreneurs often choose riskier alternatives in order to be successful. Entrepreneurial firms often will assume higher levels of debt in order to introduce new products into new markets. Entrepreneurial managers will forgo methods or products that have worked in the past.

______ is the use of new knowledge to transform organizational processes or create commercially viable products and services.

Innovation

Which of the following statements regarding the application of real options analysis to strategic decision making are true? (Check all that apply.)

It can be applied to decisions where managers have flexibility in their decisions. It works when companies are not obligated to make additional investments in a project. There are key points where managers decide whether to provide additional funding, delay, or kill the project.

Which of the following statements about radical innovation are true? (Check all that apply.)

It may lead to products or processes that can be patented. It tends to be highly disruptive. It is usually due to technological change.

Which of the following statements about managers being able to develop innovative products and services are correct? (Check all that apply.)

Practicing these skills will make managers more innovative thinkers. Creative intelligence is the key attribute that firms need to develop in their managers. Questioning, observing, experimenting, and networking play important roles in the innovative process.

______ is a forward-looking perspective characteristic of a marketplace leader that has the foresight to seize opportunities in anticipation of future demand.

Proactiveness

______ innovation refers to efforts to improve the efficiency of organizational processes, especially manufacturing systems and operations.

Process

______ innovation involves efforts to create product designs and applications of technology to develop new products for end users.

Product

Which of the following statements about an entrepreneurial culture are true? (Check all that apply.)

Senior managers must support programs and provide incentives that foster an entrepreneurial climate. Everyone in the organization is on the lookout for new opportunities. Many of the best ideas for new ventures come from functional-level employees.

______ is a problem with investment decisions in which managers "game the system" to have a project meet investment approval criteria, even though the investment may not enhance firm value.

The back-solver dilemma

Product innovation tends to be more common during which stage of the industry life cycle?

The introduction stage

Which of the following are the aims of corporate entrepreneurship (CE)? (Check all that apply.)

The pursuit of new venture opportunities Strategic renewal within the company

Which of the following statements about business incubators are correct? (Check all that apply.)

They are designed to hatch new businesses. They are a type of corporate new venture group that has a specialized purpose. They provide some or all of the following functions: funding, physical space, business services, mentoring, and networking.

True or false: Companies are often reluctant to invest time and other resources into activities with an unknown future.

True

True or false: Real options analysis is suitable for strategic decisions for investments that give a company the right, but not the obligation, to make subsequent investments.

True

What do companies gain when they use real options logic to invest in promising start-ups?

access to emerging technology

Which of the following are potential pitfalls of real options analysis? (Check all that apply.)

back-solver dilemma irrational escalation of commitment overconfidence and the illusion of control

Business risk taking of an organization involves ______.

entering untested markets or committing to unproven technology

A(n) ______ culture is one in which change and renewal are a constant focus of attention.

entrepreneurial

Focusing a firm's innovation efforts to a strategic ___________ limits the scope of the firm's efforts and helps avoid wasting resources on the project.

envelope

Which of the following refers to a willingness to introduce novelty through experimentation and creative processes aimed at developing new products and services as well as new processes?

innovativeness

Which of the following refers to a firm-specific view of innovation that defines how a firm can create new knowledge and learn from an innovation initiative even if the project fails?

strategic envelope

Companies can use real options logic to invest in young firms using funds called corporate ________ capital that are earmarked for such investments.

venture

Which of the following are among the human resources management practices that help firms to capture value from innovation efforts? (Check all that apply.)

Create innovation teams with experienced members who know how to deal with ambiguity. Separate an individual's performance from the innovation project's performance. Require employees to serve in the new venture group as part of their career ladder.

Innovation by managers requires creative intelligence, which is driven by which of the following?

Experimenting Associating Observing

Which of the following are strategic reasons for undertaking a corporate venture? (Check all that apply.)

To expand the firm's capabilities by learning and acquiring new knowledge To strengthen the firm's competitive position To build the firm's base of resources and experience To enter into new markets

Guidelines for competing in a dynamic, innovative market in which a winning technology has not yet become dominant include which of the following? (Check all that apply.)

Apply knowledge gained from an innovation that has failed to new market opportunities. Be cautious about overcommitting in an attempt to be seen as a leader in the market. Be aware that making initial correct innovation choices does not prevent later mistakes.

Which of the following refers to a willingness to act independently in order to carry forward an entrepreneurial vision or opportunity?

Autonomy

______ are corporate new venture groups that support and nurture fledgling entrepreneurial ventures until they can thrive on their own as stand-alone businesses.

Business incubators

______ is an intense effort to outperform industry rivals characterized by a combative posture or an aggressive response aimed at improving position or overcoming a threat in a competitive marketplace.

Competitive aggressiveness

Which of the following are guidelines for successfully competing in dynamic markets with high technology uncertainty? (Check all that apply.)

Consider staying in the market, even when betting on the wrong technology, so that the company does not miss out on future opportunities. Change course quickly (pivot) once a mistake is realized. Don't over commit, because it can lead to becoming entrenched in the technology that managers select.

______ is the creation of new value for a company through investments that create either new sources of competitive advantage or renewal of the value proposition.

Corporate entrepreneurship

Which of the following refers to the strategy-making practices that businesses use in identifying and launching new ventures consisting of autonomy, innovativeness, proactiveness, competitive aggressiveness, and risk taking?

Entrepreneurial orientation

Which of the following statements regarding collaborating with innovation partners are correct? (Check all that apply.)

Innovation partners may come from many sources, including research universities. Networks of partners can result in increased speed and ease when innovation is conducted. Firms must identify their strengths and weaknesses to ensure they select a partner that is complementary.

Which of the following statements about innovativeness are correct? (Check all that apply.)

Innovative companies continuously seek out new product or service offerings. It requires companies to venture beyond the current state of the art. It fosters creativity and experimentation.

Which of the following statements about autonomy are correct? (Check all that apply.)

It empowers employees to identify and leverage entrepreneurial opportunities. It applies to both dispersed and focused entrepreneurial efforts. It refers to both individuals and teams that operate outside an organization's existing norms and strategies.

Which of the following statements about entrepreneurial orientation are correct? (Check all that apply.)

It has five dimensions that permeate the decision-making styles and practices of firm's members. Its dimensions are autonomy, innovativeness, proactiveness, competitive aggressiveness, and risk taking. The five factors work together to enhance a firm's entrepreneurial performance.

______ innovation is an innovation that fundamentally changes existing practices.

Radical

______ is an investment analysis tool that suggests a path that a company can follow to manage the uncertainty of launching a new venture.

Real options analysis

______ is making decisions and taking action without certain knowledge of probable outcomes.

Risk taking

Collaborating on innovation projects with other companies is ______.

often the best means to achieve success, since new skills and insights are needed.

A(n) ______ is an individual working within a corporation who brings entrepreneurial ideas forward, identities what kind of market exists for the product or service, finds resources to support the venture, and promotes the venture concept to upper management.

product champion

Which of the following are among the challenges to innovation? (Check all that apply.)

seeds versus weeds internal versus external staffing experience versus Initiative