MGMT 352 CH. 7 EXAM QUESTIONS AND ANSWERS WITH
COMPLETE SOLUTIONS VERIFIED GRADED A++
Competition driven by innovation
-comes in waves, firms dominate an early wave and are challenged by next wave
-foundational for rapid innovation
-can create and destroy value
The Innovation Process: The 4 I's
1. Idea
2. Invention
3. Innovation
4. Imitation
Idea
Abstract concepts or research findings
Invention
the transformation of an idea into a new product or process, or the modification and
recombination of existing ones
Innovation
the commercialization of any new product or process, must continuously innovate to
sustain competitive advantage
First-mover advantage (innovation)
, -a firm's ability to be better off than its competitors as a result of being first to market in a
new product category
-learning curve
-network effect (more ppl = more value)
-increased switching cost for customers
-intellectual property rights
Imitation
Copying a successful innovation by competitors
Second mover advantage (imitation)
-first mover disadvantage
-avoid high costs of exploration (educating customers, building product image)
-avoid market uncertainty
-more mature infrastructure
-imitation less costly than innovation
The Industry Lifecycle
introduction, growth, shakeout, maturity, decline
Introduction stage
-Core competency: R&D
-want market acceptance and future growth
-high costs
-small market and slow growth
Growth stage
COMPLETE SOLUTIONS VERIFIED GRADED A++
Competition driven by innovation
-comes in waves, firms dominate an early wave and are challenged by next wave
-foundational for rapid innovation
-can create and destroy value
The Innovation Process: The 4 I's
1. Idea
2. Invention
3. Innovation
4. Imitation
Idea
Abstract concepts or research findings
Invention
the transformation of an idea into a new product or process, or the modification and
recombination of existing ones
Innovation
the commercialization of any new product or process, must continuously innovate to
sustain competitive advantage
First-mover advantage (innovation)
, -a firm's ability to be better off than its competitors as a result of being first to market in a
new product category
-learning curve
-network effect (more ppl = more value)
-increased switching cost for customers
-intellectual property rights
Imitation
Copying a successful innovation by competitors
Second mover advantage (imitation)
-first mover disadvantage
-avoid high costs of exploration (educating customers, building product image)
-avoid market uncertainty
-more mature infrastructure
-imitation less costly than innovation
The Industry Lifecycle
introduction, growth, shakeout, maturity, decline
Introduction stage
-Core competency: R&D
-want market acceptance and future growth
-high costs
-small market and slow growth
Growth stage
