7. Sources for successful innovations include(s)

a. in-house research and development.

b. customers.

c. external networks of firms.

d. all of the above

8. With which of the following would a firm NOT form an alliance?

a. customers

b. suppliers

c. competitors

d. Companies would form an alliance with any of the above

9. When Peter Debye was approached by Bell Labs to join the company working with polymers he said, "I don't know anything about polymers. I never thought about them." R.R. Williams of Bell Labs replied, "That is why we want you." This scenario points out that

a. companies prefer employees they can train themselves.

b. Williams understood that they might need someone who would bring a fresh perspective to the company.

c. Bell Labs needed a stronger sense of purpose that it currently had.

d. Bell Labs was planning on dropping its polymers research.

10. One reason that knowledge tends to be localized is that knowledge is largely held by ________________ and thus is not always readily mobile.

a. people

b. computers

c. databases

d. government entities

11. Benefits of innovation and introducing new products can include

a. protecting profit margins.

b. lowering costs.

c. speeding the pace of innovation.

d. all of the above.

12. If a firm rushes into new product development without clear strategies or processes for choosing and managing products it may

a. have difficulty in supporting new projects.

b. choose projects that are a poor fit with the firm's resources and objectives.

c. suffer long development cycles and high project failure rates.

d. all of the above.

13. As a result of the rapid pace of innovation the time between a product's introduction and its withdrawal from the market

a. has become shorter.

b. has become more predictable.

c. has become longer.

d. has not changed at all.

14. If you were the director of R&D at a large pharmaceutical company, how might you apply the concept of "the innovation funnel?"

a. hire more people because most of them will turn out to be worthless

b. encourage more new ideas because it takes thousands of new ideas to come up with one successful new product

C. discourage more new ideas because most of them end up being useless and waste time and energy

d. the innovation funnel concept could not be used by a person in this position

15. Out of all the innovative ideas that come forth, how many become successful products?

a. very few

b. most

c. about half

d. seventy-five percent

16. Which of the following is most clearly an example of process innovation?

a. a pizza chain is able to develop a method of baking pizza that enables pizzas to be baked in 10 minutes rather than the standard 20 minutes during the late 1980s

b. a potato chip company introduces a line of its potato chips with a new type of seasoning.

C. a major motion picture studio releases a new 3D movie.

d. a tire manufacturer develops a tire that re-inflates itself instantly when it is punctured

17. Which of the following are true about the development of Given Imaging's camera pill?

a. The camera pill was invented by a large manufacturer of traditional endoscope equipment

b. The camera pill was developed by a patient who wanted to solve their own needs.

c. The camera pill was developed by two teams, one lead by a guided missile engineer, and the other by a doctor.

d. The camera pill was an incremental adjustment of traditional endoscopic techniques.

18. As a company's sales of a product increases and it learns from experience about making this product, the cost of making the product should

a. decrease.

b. increase.

c. level out

d. not be affected.

19. A cell phone network recently called Bill and offered him a great plan. It was a low flat fee on all

long distance calls with no roaming charges and unlimited hours to anyone else in the network.

However, Bill discovered that so far there were only 3,000 network subscribers nationwide, so he

turned down the offer. This company did not have

a.

a good marketing idea.

b.

enough absorptive capacity.

c. sufficient network externalities.

d.

a true innovation.

20. Disetronic dominates the insulin pump market for diabetics. The disadvantages to consumers of it

being practically a monopoly probably include(s)

a.

Disetronic may charge a very high price for its pump.

b.

there may not be a lot of different styles of pumps available.

c. other types of insulin delivery systems may not be developed.

d.

all of the above.

21. Which of the following were obstacles in the early development and commercialization of personal

digital assistants (PDAs)?

a.

customer requirements were highly uncertain

b.

modem technology was immature, preventing small PDAs from having wireless connectivity.

c. battery technology was immature, preventing small and lightweight PDAs that had significant

battery life.

d.

all of the above were challenges.

22. Intel pioneered microprocessor development in the 1970s and introduced its first microprocessor

well ahead of competitors. Intel would be classified as a _____________ according to the

classification scheme provided in the text.

a.

first mover

b.

early mover

c. late entrant

d. early pioneer

23. Hydrogen as an energy source has the disadvantage of

a.

creating more environmental pollutants than fossil fuels

b.

being a very scarce commodity.

c. requiring a new refueling infrastructure to support it.

d.

capturing less of the energy potential than fossil fuelbeing less efficient.

24. For hydrogen to become a major energy source

a.

better storage facilities need to be built.

b.

a refueling infrastructure has to be developed.

c. conflicts with numerous stakeholders need to be resolved.

d.

all of the above.

25. If you enter the market too early, the risk is that

a.

the technology (or complements) will be underdeveloped.

b.

legal problems will surface that much sooner.

c. you will have large cash flow initially but it will taper off.

d.

all of the above.

26. Jackson Laboratories has come up with a new diabetic blood sugar monitoring device that does not

require patients to prick their fingers to use. It has determined that this new technology will offer a

great advantage to customers, that no other competitors possess the capabilities to deliver it, and

that the product will not be easily imitated by others. Jackson should enter the market

a.

early.

b.

late.

c. in the middle of the pack.

d.

whenever it wants to.

27. When the S.C. Johnson Company decided to come up with a new hair care product that actually

repaired split ends of hair, it spent money on market education and provided incentives to wholesalers

and retailers to sell the product. This strategy will __________ the early adoption of this innovative

product.

a.

hinder

b.

have no effect on

c. accelerate

d.

mimic

28. Apex has the reputation as the market leader in the shoe glider market and Summit is a new startup

company. Both have just released new generation shoe gliders. Which entry is likely to be adopted

more quickly?

a. Apex

b. Summit

c. both will be adopted at the same rate

d. neither, but a third company's offeringsthe x factor

29. Mountain Home University had invested heavily in IBM computers for years. Now Apple Computers

was offering them a better machine at a lower price for one of its labs, however Mountain Home did

not buy them because the ________________ costs were too high.

a. transactional

b. brand recognition

c. psychological reputation

d. switching