NETW 583 Week 4 Midterm Exam (version 1) all the answers provided.

1. (TCO A) 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 2. (TCO A) The Solow Residual refers to A. the increased a ...

1. (TCO A) 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 2. (TCO A) The Solow Residual refers to A. the increased amount of output achievable from a given quantity of labor and capital due to technological innovation. B. the less developed nations of the world being left behind due to their slower development of technology. C. obsolete products left on the market due to the accelerated product life cycle. D. the reduction in the amount of inventory needed by manufacturing firms due to technological improvements in inventory management. E. the extra leisure time consumers now enjoy as a result of technological innovation. 3. (TCO B) When both Nintendo and Sega claimed to have over 60 percent market share of the video game console market, both were trying to influence _______. A. users perceptions and expectations about the installed base. B. perceived technical utility. C. pre-order demand. D. technology bias. 4. (TCO B) Most graphic artists, newspapers, magazines, and other professionals who work intensely with pictures use Photoshop. To be perceived as a better value, a new graphics program would have to offer more value than Photoshop’s _______. A. complementary goods B. installed base C. complementary goods and installed base D. technological ability, complementary goods, and installed base 5. (TCO C) Honda’s core competencies lie in manufacturing and innovation which it has used to create its world renowned engines. These engines are also used in Honda’s portable generators, lawn mowers, motorcycles, automobiles, and several other products. According to the comparison made by Prahalad and Hamel, Honda’s portable generators are _______. A. the fruits. B. the trunk of the tree. C. the branches. D. the roots. (TCO A) Explain how computer-aided design and flexible manufacturing help create small niches in the market price. Provide an example of how a market with different niches might be served. Answer: Computer-aided design and flexible manufacturing help create small niches in the market place by allowing firms to develop and produce a more significant number of versions of their products. This means that companies can now tailor their offerings to small niches in the market place. For example, if a company manufactures basketballs, it can produce different sizes and colors of sports for children, teens, males, and females. It can also provide different games for outdoor courts and gymnasiums. Different qualities of balls can be created to meet price levels consumers are willing to pay. 8. (TCO A) Explain how an understanding of the innovation funnel might influence a company’s view of research and development? Answer: As markets become more global, increased competition from foreign competitors puts pressure on firms to innovate. Domestic companies may need to come up with more efficient means of production, and will also tend to compete through innovation to differentiate their goods and services. As communication increases through the internet and global media, consumers will have more choices in making purchase decisions. The competition will become fiercer, and companies will need to find a competitive advantage through innovative processes and products. If a company truly understands the innovation funnel concept, it will know that often at least 3,000 raw ideas are needed for one successful product. The company can then encourage its R&D staff as well as the rest of the company to come up with and submit new ideas. It will also develop ways of evaluating large numbers of views, setting up screening criteria that help the firm decide which ideas to elevate to the next level of attention.