Capstone Final

1a. Identify the five stages of the industry life cycle, and give a specific, current or historical industry example of each stage. (2.5 points)

1. Disruption/ Embryonic Starship robots 2. Growth Open AI 3. Shakeout 1922 Auto Industry 4. Maturity Soda, Pepsi or coke 5. Decline Sony or blockbuster

2a. Using the expanded strategic sourcing framework, identify and briefly explain eight distinct methods that firms can use to acquire the resources and capabilities they need to develop new products and businesses (4 points).

1. Internal Development - Using internal resources to support growth 2. Acquisition - Buying out another company. Doing so if they already have the resources to make the new product. 3. Minority Investment - financial contributions which provide access to certain resources, but not control of them. 4. Joint Venture - Two parent companies who create a third company together 5. Franchising - Licensing a whole new way of doing business 6. Licensing - pay a fee to use a brand name 7. Management Contract - Legal agreement that enable one company to have control of another business' operations 8. Outsourcing (Exporting) - Obtaining goods or services from an outside source

1b. Describe how i) consumer demand, ii) the number of competing firms, and iii) innovation change across the evolution of an industry. (0.75 points)

Consumer demand - Starts slow and increases as awareness and adoption of product or service grow Competing Firms- rapid growth attracts more players to capitalize on opportunities Innovation Change- Intense competition and continuous improvement

3c. American auto companies, including General Motors, had a chance to be first to market with hybrid cars. List five reasons why they might have chosen not to commercialize hybrid cars before Toyota and Honda did. (1.25 point)

Investment in existing technology Limited consumer demand Internal resistance Focus on short-term profits Focus on large vehicles

3d. Some observers believed that hydrogen fuel cell cars would replace gas-electric hybrid cars as the environmentally friendly car-of-choice. Why might commercializing hydrogen fuel cell cars be more difficult than commercializing gas-electric hybrid cars? (.75)

Limited infrastructure Limited consumer demand Technological uncertainty High production costs

3b. Unlike Xerox's failure to commercialize the personal computer, HP did commercialize its groundbreaking invention, the Kittyhawk disc drive. What were the main reasons why that commercialization failed? (0.75 points)

Market Misalignment Limited Storage High Cost

2b. Drawing on our discussion of the strategic sourcing framework, briefly describe the trade-off that firms must make when considering these methods. (0.5 points)

Relative Control and Relative Costs

3a. Briefly explain why Xerox may be greatest success and the worst failure in the history of the PC industry (1.5 points).

Xerox has resources and autonomy. Headquarters didn't understand the vision. Geographic distance, lack of capable boundary spanners, Incentives to protect their copier business.