Deck 17: Managing Technology and Innovation

Question 1

The appropriate time for an organization to adopt technological innovations is when the costs and risks of switching to the technology are outweighed by the benefits.

Answer 1

True
Explanation: The appropriate time for an organization to adopt technological innovations is when the costs and risks of switching to the technology are outweighed by the benefits. This point will be different for each organization, depending on each organization's characteristics and strategies.

Question 2

Being the first to develop or adopt a new technology is a risk-free path to immediate advantage and high profits.

Answer 2

False
Explanation: While potential for advantage and high profits may exist, technology leadership does impose high costs and risks that followers do not have to bear. Being the leader thus can be more costly than being the follower.

Question 3

Technology leadership is used to support a differentiation strategy, while technology followership is limited to supporting a low-cost strategy.

Answer 3

False
Explanation: Technology leadership can lead to differentiation, but if it easily increases an organization's efficiency relative to competitors, it achieves a cost advantage. Technology followership can be used to support both strategies.

Question 4

A technology life cycle can be made up of many individual product life cycles.

Question 5

A technology audit is the process of clarifying the key technologies upon which an organization depends.

Question 6

Technology is embedded in every product, service, and procedure used or produced.

Question 7

The invention life cycle is a predictable pattern that is followed by a technological innovation from its inception and development to market saturation and replacement.

Question 8

If a new technology is theoretically possible but not practical economically, the technology will probably not emerge.

Question 9

Among adopter categories for new technologies, innovators are adventurous and willing to take risks.

Question 10

The makers of generic drugs use a technology followership strategy.

Question 11

Technology can help an organization produce new products and streamline its processes, but because it is easily copied, technology is of little use in providing a competitive advantage.

Question 12

The enthusiasm of innovators as new product adopters can be an early gauge of success, though not a guarantee.

Question 13

One advantage of technology leadership is a first-mover advantage.

Question 14

Benchmarking is the process of advancing the organization's use of technology over time.

Question 15

Pacing technologies have yet to prove their full value but have the potential to alter the rules of competition by providing significant advantage.

Question 16

Emerging technologies are those that have proven effective, but still provide a strategic advantage because not everyone uses them.

Question 17

Base technologies provide a competitive advantage.

Question 18

Innovation is described as a change in method or technology, a positive and useful departure from previous ways of doing things.

Question 19

Unlike those who seek technology leadership, followers can gain a significant learning advantage that can be sustainable.

Question 20

Early adopters of a new technology are often considered impulsive and extreme by others.

Question 21

The exploding growth in piracy or fakery of patented pharmaceuticals, software, and other products has added new barriers to economic viability.

Question 22

Because of today's quick-moving technological advances, technical obstacles are overcome easily and no longer represent a concern for managers.

Question 23

Key roles in acquiring and developing new technologies are the technical innovator, product positioner, and executive developer.

Question 24

If a product champion lacks the power and financial resources to initiate innovations alone, he or she may seek an executive champion.

Question 25

In developing a strategy for technological innovation, the first consideration that should be addressed is market potential.

Question 26

Compared to benchmarking, scanning focuses on newer technologies like pacing or emerging ones.

Question 27

The majority of scientific innovations originate at universities.

Question 28

___________ is a change in method or technology, a useful departure from previous ways of doing things.

A) Innovation
B) Technology
C) Process
D) Invention
E) Discovery

Question 29

Bureaucracy, by its very nature, helps innovation to thrive.

Question 30

The sociotechnical systems approach to job design attempts to redesign tasks to optimize operation of a new technology while preserving employees' interpersonal relationships and other human aspects of the work.

Question 31

Analyzer firms have cultures that are the most outward-looking and opportunistic in their approach to technological innovation.

Question 32

Even rival organizations may use technology trading to acquire new technology.

Question 33

A CIO personally trains individual employees how to efficiently operate a company's information system.

Question 34

Most development projects benefit from having lengthy time horizons and high levels of resources devoted to them.

Question 35

The technical innovator is the person who promotes a new technology throughout the organization in an effort to obtain acceptance of and support for it.

Question 36

Development projects are focused on creating a new product or process via technological advances.

Question 37

Firms that are early adopters of new technologies tend to be more profitable.

Question 38

There are several ways to acquire new technology including internal development, forced adoption, and licensing.

Question 39

The systematic application of scientific knowledge to a new product, process, or service is called

A) Planning.
B) Organizing.
C) Technology.
D) Controlling.
E) Management.

Question 40

Even firms that are not technology-oriented must pay attention to changing technology.

Question 41

Often isolated and highly conservative in their views, ______ are extremely suspicious of innovation and change.

A) laggards
B) early adopters
C) innovators
D) early majority
E) late majority

Question 42

The three fundamental types of innovation are

A) Process innovations, business model innovations, and scientific technologies.
B) Product innovations, business model innovations, and efficiency mechanisms.
C) Process innovations, business model innovations, and product innovations.
D) Scientific technologies, product technologies, and product innovations.
E) Scientific technologies, product technologies, and efficiency mechanisms.

Question 43

The learning advantage of being a technology leader refers to

A) The ability to produce less expensive products due to familiarity and experience with the processes involved.
B) The ability to produce products more quickly through specialization of labor.
C) Keeping the company ahead of the competition by generating minor product improvements that are difficult to imitate.
D) Enhancing and improving upon the innovations of other companies.
E) Occupying the best market niches.

Question 44

In regards to adopting new technology, the early majority, representing ______ percent of adopters, is more deliberate and takes longer to decide to use something new.

A) 48
B) 13.5
C) 34
D) 16
E) 2.5

Question 45

Calliope Design carefully watches the actions of its most innovative competitors and learns from them. Calliope is most likely following a low-cost strategy by

A) Making subtle changes to the product, thereby avoiding patent restrictions.
B) Producing an imitation of the new technology that utilizes lower-quality and lower-cost materials.
C) Avoiding the costs and risks of technology leadership.
D) Mass-producing products that have an established market niche.
E) Based on the information in the question, Calliope would not be able to follow a low-cost strategy.

Question 46

An innovation will spread faster if which of the following is true?

A) It is perceived as similar to its predecessor.
B) It is compatible with existing systems and procedures.
C) It has more rather than less complexity.
D) It requires a significant commitment to try or test.
E) It is difficult to copy.

Question 47

Which of the following is a disadvantage of technology leadership?

A) Lower profit margins.
B) Intense competition.
C) Loss of brand image.
D) Higher costs.
E) Establishment of entry barriers.

Question 48

Critical forces converge to create new technologies, including

A) Resource availability and passionate leadership.
B) Entrepreneurial initiative and the capability to convert practice into new knowledge.
C) A need or demand and passionate leadership.
D) Resource availability and a need or demand.
E) The capability to convert practice into new knowledge and economic practicality.

Question 49

A person that is ________ is most likely to pay a premium for the latest and newest technology or product to come along.

A) an innovator
B) part of the early majority
C) part of the late majority
D) an early adopter
E) a laggard

Question 50

Metro Tax prepares individual tax returns and was among the first to utilize the IRS system that enabled the returns to be transmitted electronically rather than through the mail. Metro consulted on the project for the IRS with its developer and beta tested the product. It then provided a testimonial to support the system to others. Still, other tax preparation firms were hesitant to use the new system until it had proven itself reliable and considered use of the system during the first year to be somewhat risky. Metro should be classified as

A) An innovator.
B) An early adopter.
C) Part of the early majority.
D) Part of the late majority.
E) A laggard.

Question 51

A predictable pattern followed by a technological innovation starting from its inception and development to market saturation and replacement is called a(n)

A) Organizational development pattern.
B) Process innovation pattern.
C) Technology life cycle.
D) Product innovation graph.
E) Product development map.
The technology life cycle is a predictable pattern followed by a technological innovation, from its inception and development to market saturation and replacement. Figure 17.1 depicts the pattern.

Question 52

Early adopters of new technologies tend to be

A) Smaller, profitable, and generic companies.
B) Risk-averse and flexible individuals.
C) Less educated and unable to cope with uncertainty and abstraction.
D) Critical to the success of a new technology.
E) The most adventuresome and willing to take risks.

Question 53

The technology life cycle begins with

A) The bringing together of resources and entrepreneurial initiative.
B) Refinement and evolution of a new technology.
C) Recognition of a need coupled with potential to satisfy that need through science or knowledge.
D) The decline in usefulness or practicality of a competing product, process, or service.
E) Recognition that a new technology is economically practical.

Question 54

Burrell Partners is a consulting group, specializing in helping its clients develop efficient procedures in manufacturing and logistics based on technological advances. Burrell helps its clients achieve competitive advantage by developing _________ strategies for them.

A) innovation
B) differentiation
C) low-cost
D) adoption
E) diverse

Question 55

Which group of adopters of a new technology includes well-respected opinion leaders to which others look for ideas and up-to-date technological information?

A) Early adopters.
B) Late majority.
C) Innovators.
D) Early majority.
E) Laggards.

Question 56

Security Tax prepares individual tax returns and has finally agreed (much to the dismay of the senior partners) to utilize the IRS system that enables the returns to be transmitted electronically rather than through the mail. Almost every other firm in the United States is utilizing the system, and it has proven to be reliable. Security agreed to use the new technology only after a number of key clients threatened to take their accounts elsewhere unless they could file their returns electronically. Security should be classified as

A) An innovator.
B) An early adopter.
C) Part of the early majority.
D) Part of the late majority.
E) A laggard.

Question 57

What makes technology leadership attractive for some companies is the potential for

A) Infrastructure improvements.
B) Conflict resolution.
C) Higher profits.
D) Elimination of defects.
E) Lower risks.

Question 58

When a company establishes technology leadership by pioneering unique products or services that command premium prices, it has benefited from a

A) High-cost strategy.
B) Concentric strategy.
C) Low-cost strategy.
D) Diversification strategy.
E) Differentiation strategy.

Question 59

Japanese manufacturers' kaizen (continuous improvement) programs enable them to maintain

A) Strategic alliances.
B) A learning advantage over their competition.
C) Larger, faster facilities.
D) Positive working relationships with all employees.
E) A homogeneous workforce.

Question 60

Members of the late majority are late in adopting technology because they

A) Are skeptical of technological change.
B) Are not subject to social pressures.
C) Do not have access to innovations.
D) Have low self-esteem.
E) Are the most isolated and conservative in their views.

Question 61

Technology that is commonplace in the industry and that everyone must be able to operate is referred to as

A) Base.
B) Emerging.
C) Minimal.
D) Complacency.
E) Pacing.

Question 62

Antilock brake systems are a well-established feature for automobiles, but they still are not considered standard equipment in the industry. They would therefore be classified as a(n)

A) Base technology.
B) Key technology.
C) Emerging technology.
D) Market technology.
E) Pacing technology.

Question 63

__________ helps to clarify the key technologies upon which an organization depends, often in terms of their competitive value.

A) A product champion
B) A technology audit
C) Benchmarking
D) Scanning
E) A CIO

Question 64

The question an organization asks itself about whether to acquire new technology from an outside source or develop it itself involves what type of decision?

A) High risk.
B) Licensing.
C) Make-or-buy.
D) Benchmark.
E) Budgetary.

Question 65

______ have proved effective, but they also provide a strategic advantage because not everyone uses them.

A) Base technologies
B) Emerging technologies
C) Key technologies
D) Elevated technologies
E) Pacing technologies

Question 66

During the development of a new technology, ________ products may be introduced that make the main technology more useful.

A) accessory
B) auditing
C) benchmarking
D) dynamic
E) complementary

Question 67

Clarion Instruments learns from the leader in the robotics field, Canadien. As a technology follower, Clarion most likely establishes product differentiation by

A) Making a different product.
B) Creating new technologies.
C) Pioneering unique processes to add efficiencies.
D) Adapting technologies to better fit buyers' needs.
E) Technology followers cannot establish product differentiation due to strict patent restrictions.

Question 68

While competitors understandably are reluctant to share their secrets, information trading for ________ is not uncommon and can prove highly valuable.

A) product championing
B) competitive monitoring
C) corporate espionage
D) benchmarking
E) gradual diffusion

Question 69

_______ have yet to prove their full value but have the potential to alter the rules of competition by providing significant advantage.

A) Base technologies
B) Emerging technologies
C) Key technologies
D) Elevated technologies
E) Pacing technologies

Question 70

One advantage of developing technology within your own company is

A) Optimal utilization of your resources.
B) Cost efficiencies.
C) Keeping the technology exclusive to the organization.
D) Being allowed to hire more people.
E) Being able to take plenty of time to develop a product right.

Question 71

Categorizing technologies as base, key, pacing, or emerging is an effort to

A) Persuade early adopters.
B) Measure competitive value.
C) Speed the adoption process.
D) Regulate patent awards.
E) Provide a basis for licensing.

Question 72

In terms of technology culture, ________ firms' strategies are focused more on deepening their capacity base through complementary technologies that extend rather than replace their current ones, whereas hybrid _______ firms tends to grab a dominant position from their strengths in marketing and manufacturing rather than through technological innovation.

A) defender; analyzer
B) laggard; defender
C) laggard; prospector
D) inexperienced; experienced
E) analyzer; prospector

Question 73

The process of comparing an organization's practices and technologies to those of other companies is known as

A) Benchmarking.
B) Scanning.
C) Innovation.
D) Feasibility analysis.
E) Technology.

Question 74

Which of the following is the first consideration in developing a strategy around technological innovation?

A) Organizational suitability.
B) Market potential.
C) Technological feasibility.
D) Economic viability.
E) Political barriers.

Question 75

______ suggests whether there is a good financial incentive for attempting a technological innovation.

A) Technological feasibility
B) Market receptiveness
C) Economic viability
D) Organizational suitability
E) Competence development

Question 76

For most applications, word processing is considered a(n) ________ technology since it is viewed as a routine activity in most offices.

A) base
B) emerging
C) nominal
D) key
E) pacing

Question 77

Which of these technologies are still under development and thus are unproved?

A) Base technologies.
B) Emerging technologies.
C) Key technologies.
D) Initial technologies.
E) Pacing technologies.

Question 78

Which of the following is a primary factor in management's decisions on when to adopt a new technology?

A) Stock price.
B) Replacement innovations.
C) Turnover among the board of directors.
D) Appointment of a CIO.
E) The organization's technology skills.

Question 79

Scanning is

A) Comparing an organization's practices and technologies with those of other companies.
B) Focused on current activities and technologies.
C) Focused on what can be done and what is being developed.
D) Comparing the competitive advantages of two companies.
E) Clarifying the key technologies on which an organization depends.

Question 80

________ technologies provide firms with little competitive advantage but are needed to ensure competence.

A) Base
B) Emerging
C) Minimal
D) Standard
E) Pacing