Question 1

Which of the following is an advantage of first movers?

Accepted Answer

A)  They are not prone to mistakes. 
B)  They bear lower pioneering costs than later entrants do. 
C)  They only invest in the latest technology. 
D)  They do not run the risk of building the wrong resources as they are highly customer-focused. 
E)  They have an opportunity to exploit network effects and positive feedback loops. 
A)  They are not prone to mistakes. 
B)  They bear lower pioneering costs than later entrants do. 
C)  They only invest in the latest technology. 
D)  They do not run the risk of building the wrong resources as they are highly customer-focused. 
E)  They have an opportunity to exploit network effects and positive feedback loops.

Question 2

Write as if you were an outside management consultant and advise a firm attempting to win a format war with a powerful and capable competitor. Give several options.

Accepted Answer

One important consideration in winning a

Question 3

In case of emergence of a disruptive technology, established companies should:

Accepted Answer

A)  avoid investing in newly emerging technologies that may ultimately become disruptive technologies. 
B)  ask customers "Are you interested in this new technology?" 
C)  acquire newly emerging companies that are pioneering potentially disruptive technologies. 
D)  reduce costs on research and development activities. 
E)  avoid commercializing new technologies. 
A)  avoid investing in newly emerging technologies that may ultimately become disruptive technologies. 
B)  ask customers "Are you interested in this new technology?" 
C)  acquire newly emerging companies that are pioneering potentially disruptive technologies. 
D)  reduce costs on research and development activities. 
E)  avoid commercializing new technologies.

Question 4

Which of the following statements is true about establishing technical standards?

Accepted Answer

A)  Companies in an industry cannot lobby the government to mandate an industry standard. 
B)  Technical standards are often set by cooperation among businesses, without government help. 
C)  Companies cannot adopt technical standards that are in the public domain. 
D)  Market demand is not taken into consideration when it comes to establishing technical standards. 
E)  The strategy and business model a company has developed for promoting its technological standard holds little importance when it comes to establishing standards. 
A)  Companies in an industry cannot lobby the government to mandate an industry standard. 
B)  Technical standards are often set by cooperation among businesses, without government help. 
C)  Companies cannot adopt technical standards that are in the public domain. 
D)  Market demand is not taken into consideration when it comes to establishing technical standards. 
E)  The strategy and business model a company has developed for promoting its technological standard holds little importance when it comes to establishing standards.

Question 5

In order to work towards winning a format war, a company should:

Accepted Answer

A)  refrain from aggressive marketing and advertising. 
B)  ensure that there is a limited supply of complementary products. 
C)  develop its own killer applications. 
D)  keep the prices high even if the customer demand is extremely low. 
E)  refrain from cooperating with competitors under any circumstances. 
A)  refrain from aggressive marketing and advertising. 
B)  ensure that there is a limited supply of complementary products. 
C)  develop its own killer applications. 
D)  keep the prices high even if the customer demand is extremely low. 
E)  refrain from cooperating with competitors under any circumstances.

Question 6

An advantage of being a first mover is that:

Accepted Answer

A)  the pioneering costs are minimal. 
B)  there are well-defined distribution channels. 
C)  there is no risk of building the wrong resources. 
D)  the focus is always on the mass market. 
E)  there is an opportunity to increase sales volume ahead of rivals. 
A)  the pioneering costs are minimal. 
B)  there are well-defined distribution channels. 
C)  there is no risk of building the wrong resources. 
D)  the focus is always on the mass market. 
E)  there is an opportunity to increase sales volume ahead of rivals.

Question 7

Mathematica 1.0 was one of the most distinctive applications for the short-lived NeXT Computer. It still sets the standard for symbolic math and visualization on Windows, Mac, Linux, and Unix. Mathematica 1.0 can be described as a(n) _____ application.

Accepted Answer

A)  dominant 
B)  analogous 
C)  hardware 
D)  strategic 
E)  killer 
A)  dominant 
B)  analogous 
C)  hardware 
D)  strategic 
E)  killer

Question 8

Libra Electronics has invented a new technology to make laptops that are extremely lightweight and unbreakable. The company is advertising aggressively and wishes to create demand for its new range of laptops. To attract customers, the company has priced the laptops attractively. However, in order to make profits, the company has priced the batteries required for the laptops extremely high. Which of the following is illustrated in this scenario?

Accepted Answer

A)  downsizing strategy. 
B)  harvest strategy. 
C)  razor and blade strategy. 
D)  divestment strategy. 
E)  switching costs. 
A)  downsizing strategy. 
B)  harvest strategy. 
C)  razor and blade strategy. 
D)  divestment strategy. 
E)  switching costs.

Question 9

Cooperating with competitors:

Accepted Answer

A)  reduces competition in the market. 
B)  creates confusion among customers and often lead them to delay their purchases. 
C)  helps lower the entry barriers of the industry, thus allowing new entrants to bring in their own formats. 
D)  curbs network effects by discouraging complementary products. 
E)  results in the creation of several new formats, thus intensifying format wars. 
A)  reduces competition in the market. 
B)  creates confusion among customers and often lead them to delay their purchases. 
C)  helps lower the entry barriers of the industry, thus allowing new entrants to bring in their own formats. 
D)  curbs network effects by discouraging complementary products. 
E)  results in the creation of several new formats, thus intensifying format wars.

Question 10

Switching costs are the costs that consumers must bear to switch from a product based on one technological standard to a product based on another technological standard.

Accepted Answer

A) True 
 B)False

Question 11

The layout of the keys on a computer keyboard is an example of a technical standard.

Accepted Answer

A) True 
 B)False

Question 12

When a first mover does not have complementary assets, barriers to imitation are high, and there are several capable competitors, the first mover should:

Accepted Answer

A)  license the innovation to others. 
B)  enter into a joint venture to protect the product. 
C)  lower the barriers for imitation. 
D)  sell the technology outright to another firm. 
E)  wait until competitors develop an alternative product. 
A)  license the innovation to others. 
B)  enter into a joint venture to protect the product. 
C)  lower the barriers for imitation. 
D)  sell the technology outright to another firm. 
E)  wait until competitors develop an alternative product.

Question 13

Computer software products have high marginal costs.

Accepted Answer

A) True 
 B)False

Question 14

_____ are applications or uses of a new technology or product that are so compelling that customers adopt them in droves, curbing the demand for competing formats.

Accepted Answer

A)  Killer applications 
B)  Razor and blade applications 
C)  Technical standards 
D)  Network effects 
E)  Concurrency control applications 
A)  Killer applications 
B)  Razor and blade applications 
C)  Technical standards 
D)  Network effects 
E)  Concurrency control applications

Question 15

One strategy for success in high-tech industries is to keep prices low in order to increase sales volume.

Accepted Answer

A) True 
 B)False

Question 16

Technological disruption:

Accepted Answer

A)  is typically a temporary phase lasting a few months. 
B)  occurs when the manufacturing plants of a company fail. 
C)  mostly affects the new entrants. 
D)  compels firms to adopt new business models. 
E)  is a problem primarily in embryonic industries. 
A)  is typically a temporary phase lasting a few months. 
B)  occurs when the manufacturing plants of a company fail. 
C)  mostly affects the new entrants. 
D)  compels firms to adopt new business models. 
E)  is a problem primarily in embryonic industries.

Question 17

Network effects arise in an industry where:

Accepted Answer

A)  the size of the network of complementary products is a primary determinant of demand for an industry's product. 
B)  a large network of companies in an industry use the same business model and strategies. 
C)  a company is able to adhere to the same technical standards across its network of outlets. 
D)  companies network together and lobby for establishing certain technical standards. 
E)  companies that are not in favor of a technical standard network together. 
A)  the size of the network of complementary products is a primary determinant of demand for an industry's product. 
B)  a large network of companies in an industry use the same business model and strategies. 
C)  a company is able to adhere to the same technical standards across its network of outlets. 
D)  companies network together and lobby for establishing certain technical standards. 
E)  companies that are not in favor of a technical standard network together.

Question 18

Companies that are locked out of a market are those in which consumers are unwilling to bear the switching costs required for them to abandon the established standard and adopt the new one.

Accepted Answer

A) True 
 B)False

Question 19

Even if they are constrained by a lack of capital, research shows that new entrants should avoid partnering with a larger company.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following statements is true about new entrants in the context of a technological paradigm shift?

Accepted Answer

A)  New entrant often face the risks of product cannibalization. 
B)  Pressures to continue the existing out-of-date business model hamstring new entrants. 
C)  New entrants do not need to worry about their established customer base. 
D)  It is difficult for new entrants to focus all their energies on the opportunities offered by the new disruptive technology. 
E)  New entrants are not constrained by lack of capital. 
A)  New entrant often face the risks of product cannibalization. 
B)  Pressures to continue the existing out-of-date business model hamstring new entrants. 
C)  New entrants do not need to worry about their established customer base. 
D)  It is difficult for new entrants to focus all their energies on the opportunities offered by the new disruptive technology. 
E)  New entrants are not constrained by lack of capital.

Which of the following is an advantage of first movers?

Write as if you were an outside management consultant and advise a firm attempting to win a format war with a powerful and capable competitor. Give several options.

In case of emergence of a disruptive technology, established companies should:

Which of the following statements is true about establishing technical standards?

In order to work towards winning a format war, a company should:

An advantage of being a first mover is that:

Mathematica 1.0 was one of the most distinctive applications for the short-lived NeXT Computer. It still sets the standard for symbolic math and visualization on Windows, Mac, Linux, and Unix. Mathematica 1.0 can be described as a(n) _____ application.

Cooperating with competitors:

Switching costs are the costs that consumers must bear to switch from a product based on one technological standard to a product based on another technological standard.

The layout of the keys on a computer keyboard is an example of a technical standard.

When a first mover does not have complementary assets, barriers to imitation are high, and there are several capable competitors, the first mover should:

Computer software products have high marginal costs.

_____ are applications or uses of a new technology or product that are so compelling that customers adopt them in droves, curbing the demand for competing formats.

One strategy for success in high-tech industries is to keep prices low in order to increase sales volume.

Technological disruption:

Network effects arise in an industry where:

Companies that are locked out of a market are those in which consumers are unwilling to bear the switching costs required for them to abandon the established standard and adopt the new one.

Even if they are constrained by a lack of capital, research shows that new entrants should avoid partnering with a larger company.

Which of the following statements is true about new entrants in the context of a technological paradigm shift?

Strategic Leadership: Managing the Strategy-Making Process for Competitive Advantage

External Analysis: The Identification of Opportunities and Threats

Internal Analysis: Resources and Competitive Advantage

Building Competitive Advantage Through Functional-Level Strategies

Business-Level Strategy

Business-Level Strategy and the Industry Environment

Strategy in the Global Environment

Corporate-Level Strategy: Horizontal Integration, Vertical Integration, and Strategic Outsourcing

Corporate-Level Strategy: Related and Unrelated Diversification

Corporate Performance, Governance, and Business Ethics

Implementing Strategy Through Organization

Filters

Exam 7: Strategy and Technology

Which of the following is an advantage of first movers?

Write as if you were an outside management consultant and advise a firm attempting to win a format war with a powerful and capable competitor. Give several options.

In case of emergence of a disruptive technology, established companies should:

Which of the following statements is true about establishing technical standards?

In order to work towards winning a format war, a company should:

An advantage of being a first mover is that:

Mathematica 1.0 was one of the most distinctive applications for the short-lived NeXT Computer. It still sets the standard for symbolic math and visualization on Windows, Mac, Linux, and Unix. Mathematica 1.0 can be described as a(n) _____ application.

Cooperating with competitors:

Switching costs are the costs that consumers must bear to switch from a product based on one technological standard to a product based on another technological standard.

The layout of the keys on a computer keyboard is an example of a technical standard.

When a first mover does not have complementary assets, barriers to imitation are high, and there are several capable competitors, the first mover should:

Computer software products have high marginal costs.

_____ are applications or uses of a new technology or product that are so compelling that customers adopt them in droves, curbing the demand for competing formats.

One strategy for success in high-tech industries is to keep prices low in order to increase sales volume.

Technological disruption:

Network effects arise in an industry where:

Companies that are locked out of a market are those in which consumers are unwilling to bear the switching costs required for them to abandon the established standard and adopt the new one.

Even if they are constrained by a lack of capital, research shows that new entrants should avoid partnering with a larger company.

Which of the following statements is true about new entrants in the context of a technological paradigm shift?

Strategic Leadership: Managing the Strategy-Making Process for Competitive Advantage

External Analysis: The Identification of Opportunities and Threats

Internal Analysis: Resources and Competitive Advantage

Building Competitive Advantage Through Functional-Level Strategies

Business-Level Strategy

Business-Level Strategy and the Industry Environment

Strategy in the Global Environment

Corporate-Level Strategy: Horizontal Integration, Vertical Integration, and Strategic Outsourcing

Corporate-Level Strategy: Related and Unrelated Diversification

Corporate Performance, Governance, and Business Ethics

Implementing Strategy Through Organization

Filters