Innovation: Planning

MULTIPLE CHOICE

     1.   Benefits of innovation include all of the following except:

a.
Greater control over process and outcomes
b.
Greater profit potential as first mover
c.
Greater ability to evaluate competitors
d.
Greater understanding of the technology
e.
Greater ability to potentially develop the next generation of technology

ANS:  C                    PTS:   1

     2.   Drawbacks of innovation include all of the following except:

a.
Keeping a pipeline of new products is difficult
b.
Greater risk of failure to develop the right products at the right time
c.
Greater liability for failed products
d.
Usually internal development is slower
e.
There is always the danger of someone beating you to the market

ANS:  C                    PTS:   1

     3.   In order to encourage innovation, 3M allows its employees to spend how much of their time on projects of their choice?

a.
5%
b.
15%
c.
20%
d.
25%
e.
40%

ANS:  B                    PTS:   1

     4.   The first question that should take place as the firm conducts it innovation strategy planning is ____.

a.
Do we innovate internally or not?
b.
Are we making a profit?
c.
What is happening in economy?
d.
What is attitude of leadership to innovation?
e.
Will shareholders tolerate innovative strategy?

ANS:  A                    PTS:   1

     5.   What is the name given to a firm that is the first to the market for a given product?

a.
Innovator
b.
Leader
c.
First mover
d.
Producer
e.
Follower

ANS:  C                    PTS:   1

     6.   It is beneficial to be a follower when ____.

a.
an industry is growing too fast
b.
an industry has high customer loyalty
c.
there are high customer educational costs
d.
the industry leader is the first mover
e.
there are few penalties for industry mistakes

ANS:  C                    PTS:   1

     7.   Which type of research and development (R&D) is done to answer specific questions?

a.
Basic research
b.
Systems integration
c.
Applied research
d.
Product research
e.
Industry research

ANS:  C                    PTS:   1

     8.   The creation of new knowledge involves ____.

a.
Basic research
b.
Systems integration
c.
Applied research
d.
Product research
e.
Industry research

ANS:  A                    PTS:   1

     9.   Intel labs are now seeking to develop a new type of computer chip that is more compact. This is an example of ____.

a.
Basic research
b.
Systems integration
c.
Applied research
d.
Product research
e.
Industry research

ANS:  C                    PTS:   1

   10.   The R&D method that is the most incremental in nature is:

a.
Basic research
b.
Systems integration
c.
Applied research
d.
Product research
e.
Industry research

ANS:  B                    PTS:   1

   11.   The lowest risk type of R&D is ____.

a.
Basic research
b.
Systems integration
c.
Applied research
d.
Product research
e.
Industry research

ANS:  B                    PTS:   1

   12.   Systems integration:

a.
is R&D that largely takes place outside of the firm
b.
is high risk/high return
c.
involves adjusting the ways a firm organizes it systems, structures, and knowledge to increase leverage
d.
adds to basic understanding of a new field
e.
is the most difficult type of innovation to accomplish

ANS:  C                    PTS:   1

   13.   The type of research universities are mostly involved in is:

a.
quantitative
b.
applied
c.
systems integration
d.
qualitative
e.
basic

ANS:  E                    PTS:   1

   14.   Process innovation focuses on ____.

a.
The development of new products
b.
Increasing effectiveness and effectiveness of the organization
c.
Increasing profits
d.
Decreasing the number of employees in the firm
e.
Basic R&D

ANS:  B                    PTS:   1

   15.   Reengineering’s goals include all of the following except:

a.
increasing productivity
b.
optimizing value to shareholders
c.
achieving quantum results
d.
expanding functions
e.
eliminating unnecessary levels and work

ANS:  D                    PTS:   1

   16.   Sticky notes are a good example of ____.

a.
Small innovations that make too much money
b.
The role of teamwork in innovation
c.
The central role of a single person in the innovation process
d.
How to rescue a failed product
e.
How a single product can rescue a troubled firm

ANS:  B                    PTS:   1

   17.   The innovation process within a firm is ____ process.

a.
A logical and consistent
b.
A free flowing
c.
A predictable
d.
Not a central
e.
A political

ANS:  E                    PTS:   1

   18.   To create an environment for innovation a manager must understand all of the following except:

a.
The reality of innovation
b.
The needed characteristics of innovation for their business climate
c.
What each level of the organization should be doing to create a climate of innovation within the organization
d.
What the organization needs to do to maintain this innovation climate
e.
How to seek a new vision for the organization

ANS:  E                    PTS:   1

   19.   When Louis Gerstner took over IBM he determined that planning should have all of the following activities except:

a.
ensuring external opportunities and threats were the focus of the planning not internal organizational issues
b.
ensuring that the plan focused on key implementation issues
c.
structuring on going processes to reexamine fundamental strategic challenges
d.
ensuring allocation decisions were not impacted by short term shifts in strategy
e.
promoting widespread support and involvement in process

ANS:  D                    PTS:   1

   20.   There are four ways that innovative organization encouraged creative thinking and perpetual challenging within the organization. They include all of the following except:

a.
Adventuring
b.
Confronting
c.
Portfolioing of skill
d.
Opportunity identifying
e.
Rewarding

ANS:  E                    PTS:   1

   21.   Adventuring as a means to encourage creative thinking involves:

a.
Exploring an area outside of your comfort zone
b.
Deliberate debates
c.
Building a portfolio of skills
d.
Creative employees developing new projects
e.
A camping trip by employees to build teamwork

ANS:  A                    PTS:   1

   22.   Which one of these methods to encourage creativity involves stretching your skills?

a.
Adventuring
b.
Confronting
c.
Portfolioing of skill
d.
Opportunity identifying
e.
Rewarding

ANS:  C                    PTS:   1

   23.   Confronting as a means to encourage creative thinking involves:

a.
Exploring an area outside of your comfort zone
b.
Deliberate debates
c.
Building a portfolio of skills
d.
Creative employees developing new projects
e.
A camping trip by employees to build teamwork

ANS:  B                    PTS:   1

   24.   Which of the following is not a primary way innovative organizations encourage creative thinking and perpetual challenging within the organization?

a.
Referring
b.
Confronting
c.
Portfolioing of skills
d.
Adventuring
e.
Opportunity identifying

ANS:  A                    PTS:   1

   25.   A mission statement usually has:

a.
more than 150 words
b.
more than 75 words
c.
less than 75 words
d.
less than 60 words
e.
less than 25 words

ANS:  D                    PTS:   1

   26.   During the “Growth” stage of the technology life cycle, what kind of information does the firm need?

a.
Competitors’ actions
b.
Science trends
c.
Other uses of technology
d.
Market sustainability
e.
Developments

ANS:  A                    PTS:   1

   27.   What stage of the life cycle would the focus be on monitoring potential competitors?

a.
Startup
b.
Growth
c.
Maturity
d.
Decline
e.
Death

ANS:  B                    PTS:   1

   28.   How should you describe the innovation process?

a.
irregular and unpredictable
b.
straight and narrow
c.
defined and renowned
d.
nice and easy
e.
slow and steady

ANS:  A                    PTS:   1

   29.   Which one of the following is not a common myth about innovation?

a.
A good process is 90% of the battle
b.
Leadership, culture and process form a three legged stool
c.
Have a good methodology for evaluating ideas
d.
We want to be entrepreneurial
e.
We need the next big idea

ANS:  B                    PTS:   1

   30.   Which one of these statements is a myth about innovation?

a.
Seek a balance of behaviors
b.
Leadership, culture and process form a three-legged stool
c.
Ideas are the key to innovation
d.
Your organization has lots of brilliant ideas that you’ve never heard of
e.
Do not blind yourself to the human dimension

ANS:  C                    PTS:   1

   31.   It took how long to develop large flat screen panels for market?

a.
6 months
b.
1 year
c.
3 years
d.
5 years
e.
20 years

ANS:  E                    PTS:   1

   32.   Which of the following does 3M do to encourage innovation?

a.
employees are required to spend 35 percent of their time on innovative projects
b.
seed money is provided to promising ideas
c.
compensation system rewards employees for innovations
d.
compensation system is strictly focused on employees innovation so slacking employees do not slow them down
e.
25 percent of revenue is spent on advertising each year

ANS:  C                    PTS:   1

   33.   Tweaking is associated with which type of research:

a.
basic
b.
process
c.
applied
d.
systems integration
e.
product

ANS:  D                    PTS:   1

   34.   Strategic group maps a firm’s attention on those firms that:

a.
compose the total industry
b.
substitute for the industry
c.
are the same size
d.
are most relevant as competitors
e.
are in the same region

ANS:  D                    PTS:   1

   35.   Downsizing refers to:

a.
firms selling machinery that is no longer useful
b.
seeking to operate the same business in a smaller building
c.
building smaller telephone units for customers
d.
compressing more data in a smaller space
e.
selling units or laying off employees of the firm

ANS:  E                    PTS:   1

TRUE/FALSE

     1.   A company should always strive to be the first mover in the industry.

ANS:  F                    PTS:   1

     2.   Ideas are the key to innovation.

ANS:  F                    PTS:   1

     3.   Individuals in the organization may only engage in the innovation process over time.

ANS:  F                    PTS:   1

     4.   Two principle ways a company can acquire new technology are internal innovation and/or some type of alliance or purchase.

ANS:  T                    PTS:   1

     5.   A first mover is a firm that is first to market with a given product.

ANS:  T                    PTS:   1

     6.   Innovation is usually the product of one person’s effort and genius.

ANS:  F                    PTS:   1

     7.   It is sometimes more beneficial to be a follower in an industry then a leader.

ANS:  T                    PTS:   1

     8.   The first question a firm considering an innovation strategy should ask is “should we innovate, or not?”

ANS:  T                    PTS:   1

     9.   Aspects of the innovation process may come from different parts of an organization.

ANS:  T                    PTS:   1

   10.   Process activities are related to how the firm reacts to trying new ideas.

ANS:  T                    PTS:   1

   11.   Basic research takes knowledge new to the firm and allows the firm to change its strategic position in the industry, or at least, change its potential position in the industry?

ANS:  F                    PTS:   1

   12.   It is a myth about innovation is that firms need to seek a balance of behaviors among its employees to be successful.

ANS:  F                    PTS:   1

   13.   The motivation for applied research is to answer specific questions.

ANS:  T                    PTS:   1

   14.   With all that is involved in innovation, the direction of a new product is easy to forecast.

ANS:  F                    PTS:   1

   15.   A negative element to embracing internal innovation as a strategy includes a greater risk of failure to develop the right product at the right time.

ANS:  T                    PTS:   1

SHORT ANSWER

     1.   What are the potential benefits of an innovation strategy?

ANS: 

·
Greater control of the process and the outcomes
·
Greater understanding of the technology produced and how to apply it
·
Greater ability to potentially develop the next generation of technology
·
Greater profit potential as a first mover

PTS:   1

     2.   Discuss the three principal types of R&D.

ANS: 

·
Basic – Involves the creation of new knowledge that can lead to fundamentally new products or ways of doing business
·
Applied – Used to answer specific questions, takes knowledge new to the firm and allows the firm to change its strategic position in the industry, purpose is to add value to the firm and its customers
·
Systems integration – Aimed at supporting existing businesses and has low risks and rewards associated with it, involves adjusting the ways the firm organizes its systems, structures, and knowledge to increase its leverage

PTS:   1

     3.   Discuss the four primary ways that innovative organizations encourage creative thinking.

ANS: 

·
Adventuring – individuals within the firm explore areas that are outside their comfort zones; generation of new ideas; experimentation, introspection, scenario making
·
Confronting – deliberate debates among employees, conceptual or contextual
·
Portfolioing of skills – working on multiple projects at the same time leads to knowledge sharing
·
Opportunity identifying – generating and following through on creative projects with potential commercial value, can be active or selective

PTS:   1

     4.   There are negative elements to embracing internal innovation as a strategy. Please list three of these negative elements.

ANS: 

·
Usually an internal development strategy is slower
·
There is a greater risk of failure to develop the right product at the right time
·
Keeping a pipeline of new products/processes is difficult at best. There is always the danger that someone will beat you to market

PTS:   1

     5.   List four stages of technology, describe the “Focus” and information needed in each stage.

ANS: 

·
Start-up: Broad focus, information on science trends and breakthroughs
·
Growth: Focus on potential competitors, information on trends and competitors actions
·
Maturity: Focus on problem solving and improvements, information needed on competitors and other uses of technology
·
Decline: Focus on avoiding of loses, information on market sustainability

PTS:   1

     6.   Briefly describe what a manager needs to understand to create a climate for Innovation.

ANS: 

·
The reality of innovation
·
What are the needed characteristics for this climate
·
What each level of the organization should be doing to build this climate
·
What activities the organization must have in place to meet the perpetual
·
Challenges of maintaining the innovation climate

PTS:   1

     7.   How did 3M position itself as an innovative firm?

ANS: 

·
Employees allowed to spend 15% of their time each week innovating products which they do not have to account for
·
Spends 6% of the firm’s revenue on R&D each year
·
Rewards tied to innovation

PTS:   1