MKT 410 Final – Flashcards
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A majority of new product development projects result in an economic return.
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FALSE
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A company with a short development cycle can quickly revise or upgrade its offering.
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TRUE
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A sequential process has an early warning system to indicate that planned features are not manufacturable.
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FALSE
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Parallel development processes are universally endorsed.
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FALSE
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The use of executive sponsors reduces the effectiveness of the development process.
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FALSE
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A firm can benefit from developing "antichampions"
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TRUE
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Firms often make decisions about projects on the basis of marketing criteria.
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FALSE
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Many firms use beta testing to get customer input early in the development process.
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TRUE
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Suppliers can contribute ideas for product improvement or increased development efficiency.
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TRUE
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In Stage 1 of the stage-gate process, the team builds a business case that includes a defined product, its business justification, and a detailed plan of action for the next stages.
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FALSE
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The time elapsed from project initiation to product launch, usually measured in months or years is referred to as _____.
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c. development cycle time
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Which of the following is typically true regarding a firm with a long development cycle time?
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b. Its cost of capital will increase.
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Trekker Inc. has developed a product with a very short product development cycle. Which of the following results can it typically expect?
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b. It will be able to provide complementary goods to enhance the attractiveness of its product.
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Which of the following statements is true of partly parallel development processes?
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c. It shortens overall cycle time.
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Josh is the executive vice president of a bank. Recently the president of the bank asked Josh to use his influence to ensure that the online banking project was developed and implemented. Paul is being asked to be a:
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b. project champion.
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An "antichampion" is:
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b. a person who plays the role of the "devil's advocate."
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A(n) _____ of a product is an early working prototype of a product released to users for testing and feedback.
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a. beta version
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Astech Inc. has been developing a new graphic design software. The firm releases a functional version of the software, and sends it to several lead users for testing. Based on the feedback from the lead users, the firm will improve the design of the product, and begin commercial production. This initial version of the product is referred to as the _____.
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c. beta version
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Customers who face the same general needs of the marketplace but are likely to experience them months or years earlier than the rest of the market and stand to benefit disproportionately from solutions to those needs are referred to as _____.
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d. lead users
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Dr. Peterson is a professor of Information Systems at Mount Newfield University. She was asked to be a beta tester for the latest version of Microsoft Office a year before it was released because she tends to use such programs in an advanced way and often develops her own solutions to problems with the programs. She made several suggestions for its improvement. She is a(n):
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a. lead user
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What are the risks of championing?
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A managers role as a champion may cloud judgement about the true value of the project. Not knowing when a project should be killed.
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Alpha Cleaning Equipment Co. is experimenting with a faster and quieter machine to polish floors. To develop this concept the company is contemplating using the lead user method of concept development. How does this method work? What are its advantages?
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Gaining input months or years earlier. Making improved product.
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A cross-functional team is one that has members of different ethnic backgrounds in a single functional area.
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FALSE
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Cross-functional communication can lead to longer cycle times.
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FALSE
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Homogeneous teams should possess more information, on average, than heterogeneous groups.
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FALSE
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In a functional team approach to new product development, team members remain in their functional departments and meet periodically to work on the project.
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TRUE
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Functional teams typically have a project manager or dedicated liaison personnel.
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FALSE
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Managers of lightweight teams are normally junior or middle management employees.
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TRUE
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Lightweight teams are appropriate for derivative projects.
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TRUE
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In heavyweight teams, the long-term career development of individual members rests with their project managers rather than their functional managers.
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FALSE
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In the context of product development teams, which of the following is true?
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b. As the size of the team increases, the potential for social loafing increases.
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Karen's supervisor, while discussing about her participation in a new product development team, tells her that she has been engaging in social loafing. This indicates that Karen:
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c. has not been putting much effort into the team's work.
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At Tech Edge Inc., a special team is set up for making a robot capable of assisting blind people in daily activities. The members of the team are taken from various areas of the firm including R&D, marketing, manufacturing, and distribution. The new team is put under the charge of a senior manager. This team is an example of a:
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a. cross-functional team.
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Which of the following is an advantage typically associated with cross-functional teams?
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b. Cross-functional teams allow a project to draw on a wider mix of information sources in the environment.
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The Vice President of Sunflower Computers is trying to decide on the composition of a new product development team. If he chooses members who are from different backgrounds, he can reap the benefits of:
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a. a broader knowledge base.
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The Vice President of Biomedics is trying to decide on the composition of a new product development team. If she chooses members who are from multiple functional areas in the firm, which of the following is likely to be one of the disadvantages she is likely to experience?
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b. Increase in communication and coordination costs
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June is the member of a new product development team. Her supervisor asked her about her experience in the team and she replied, "Our team seems to be suffering from homophily." This means that:
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d. team members only like other people whom they perceive as being similar to themselves.
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Ruth works in the advertising department of her company. It was observed that she interacted more frequently and more intensely with team members who shared her interests and social background and ignored others. This phenomenon exhibited by Ruth is referred to as:
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c. homophily.
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Albert has put together a new product development team based on the functional team structure. Which of the following is most likely to be true about this team?
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d. The team structure will be straightforward to implement.
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Which of the following is true of functional teams?
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a. Functional teams consist of members from multiple areas in the firm such as R&D, marketing, manufacturing, distribution, and so on.
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The value of a technological innovation is solely determined by what the technology can do.
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FALSE
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Firms should always be racing to launch their products as early as possible.
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FALSE
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Cannibalization is the process by which a firm's sales of one product diminishes as a result of a substitute product offering by a competitor.
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FALSE
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If a firm willingly cannibalizes its existing products with more advanced products, the firm can make it very easy for other firms to achieve a technological lead large enough to prove persuasive to customers.
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FALSE
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If a firm wishes to avoid giving away its own installed base or complementary goods advantages to others, it should ensure that its products are incompatible with those of future entrants.
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TRUE
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If a firm's objective is maximum market skimming, it will initially set a high price on new products.
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TRUE
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Firms intending to maximize market share, typically use market skimming pricing strategy.
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FALSE
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Firms in industries characterized by increasing returns will use the objective of maximizing market share and a penetration pricing strategy.
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TRUE
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When manufacturers bypass wholesalers and retailers to sell directly to end users it is called backward compatibility.
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FALSE
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If customers require extensive education and service, selling through mail order or online ordering may be the best option.
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FALSE
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When Pearl Love introduced its new range of body wash, consumers switched from using soaps, sold under the same brand, to its new body wash. As a result, the company experienced a sharp drop in its soap sales. This is best known as:
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a. cannibalization.
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BioSense Prosthetics was a leader in the prosthetic arm market and profits from it were very high. The firm developed a new computerized prosthetic arm that would render its previous prosthetics obsolete. It decided to withhold the new computerized prosthetic arm from the market. This will allow the firm to:
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c. avoid cannibalization of the sales of its current prosthetics.
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Maverick Systems was a leader in the phone market and profits from its cell phones were very high. Maverick Systems developed a new generation smartphone and has been advised by a consulting firm to "embrace cannibalization." This means that the company should:
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a. introduce the new technology right away and increase its market lead while taking away profits from its present product.
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If a firm invests in continuous innovation and willingly cannibalizes its existing products with more advanced products, the firm can:
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c. prevent competitors from achieving a significant technological lead.
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Genetech Inc. has produced a new generation video game console. The new product can still be used to run the same games as the previous generation of the video game console. In this context, Genetech is typically applying:
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b. backward compatibility.
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Speeding Horse Inc., the leader in the video game console market, is making its new generation consoles backward compatible with its previous games. This means that:
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b. it is providing a significant incentive to the owners of its previously developed consoles and games.
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Which of the following is an advantage of making a new generation of technology backward compatible?
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b. Consumer switching costs may be lower because they anticipate using their existing complements.
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A(n) _____ price strategy prices goods to cover variable costs and some fixed costs.
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c. survival
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When Sports 360, a sports bar in New York, saw yet another sports bar open up across the street it knew that it would have to lower its price again to stay in business. The city already had too many sports bars and Sports 360 intended on being one of those left after the inevitable shake out. The best pricing strategy for Sports 360 will be:
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c. survival pricing.
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In the context of Gladwell's theories, define the terms connectors, mavens, and salespersons.
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Connectors are individuals who tend to form an exceptionally large circle of acquaintances. Mavens are individuals who are driven to obtain and disseminate knowledge about one or more of their interests. Salespersons are those individuals who are naturally talented persuaders.
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Innovation and new technologies have led to longer product life cycles and lowered product obsolescence.
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FALSE
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Technological innovation decreases the amount of output achievable from a given quantity of labor and capital.
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FALSE
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Based on the funnel illustration in our class slides, what answer correctly fills in the blank box X?
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X on drawing: b.1 Successful new product
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Based on the funnel illustration in our class slides, what answer correctly fills in the blank box Z?
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Z on drawing: d.4 Major developements
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Virtual Inc., a manufacturing company, has recently entered into the cell phone industry. This industry is characterized by rapid technological innovations. Which of the following is an implication for Virtual Inc.?
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b. It will face rapid product obsolescence.
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The science-push approach to research and development argued that innovation was driven by the perceived demand of potential users.
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FALSE
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The degree to which innovative activities are geographically clustered is independent of the national differences in the way technology development is funded or protected.
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FALSE
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Which of the following is considered to be a novel idea?
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b. A company announces that it has produced a recreational hovercraft for kids
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The Tata Nano was a:
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a. Radical innovation
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The Tata Nano was a:
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b. Architectural innovation
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An innovation can be competence enhancing to one firm, while competence destroying for another.
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TRUE
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When a technology's performance is plotted against the amount of effort and money invested in the technology, it typically shows slow initial improvement, then accelerated improvement, then diminishing improvement
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TRUE
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It is possible for a firm that follows an s-curve model too closely to end up switching technologies later than it should.
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TRUE
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Which of the following is most clearly an example of process innovation?
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a. A donut chain develops a method that enables donuts to be baked in 15 minutes rather than the standard 30 minutes.
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Which of the following is considered a radical innovation?
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c. Developing a cell phone that allows customers to scan the prices of the products in stores and make payments for their purchases
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Which of the following is true of s-curves in technological improvement?
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d. The s-curves flatten when the cost of each marginal improvement increases and when diminishing returns to effort begin to set in.
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In the context of s-curve in technological improvement, plotting performance against time will result in the same characteristic curve as plotting performance against effort, only if:
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b. effort is relatively constant over time.
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Digital cameras replaced film cameras. This is an example of _____.
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d. discontinuous technology
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A CEO of a certain pharmaceutical company asked his consultant if it was a good idea to implement the s-curve model to predict when a technology would reach its limits. The consultant identified a limitation with the use of the model. Which of the following is the limitation identified by the consultant?
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d. The s-curve model is outdated and unrealistic.
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Ron is highly skeptical about new ideas and products. He has not yet bought a satellite dish for his home because he is still unsure that it really works. Ron is also very worried about the expense of purchasing the satellite dish. According to this description, Ron:
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c. is a laggard.
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A marketing research company categorized Jane as an early adopter. Which of the following is true of Jane in the context of early adopters?
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b. She will be well integrated into her social system.
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The learning curve indicates that the more units a company produces of an item, the more each unit will cost.
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FALSE
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In a market characterized by network externalities, the benefit from using a good decreases with an increase in the number of other users of the same good.
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FALSE
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A firm that supports a technology that is not chosen as the dominant design will have better potential to earn near-monopoly rents in the short run than a firm that develops a dominant design.
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FALSE
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The influence of a dominant design can extend beyond its own technology cycle.
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TRUE
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Technologically superior products do not always win in the market.
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TRUE
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The more a technology is adopted:
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c. the better are the opportunities for development of complementary assets.
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Clear Vision Inc. has been the market leader for eye-related products, such as eyeglasses and lenses. It has also most recently developed the use of laser technology to correct eye defects. Due to its prior related experiences, it has been successful in recognizing the value of new information and using it to develop new technologies ahead of others. This phenomenon is called:
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a. absorptive capacity.
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Firms that develop new technologies ahead of others often try a number of unsuccessful techniques before finding a solution that works well. This experimentation:
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d. enables the firm to find related solutions and alternatives that work well.
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Dynamic Capabilities are competencies that allow a firm to quickly react to change True or False
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TRUE
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Due to Qualitative methods being very hard to judge, a vast majority of firms nowadays use Quantitative methods to produce innovation. True or False
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FALSE
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Using internal analysis, which of the firm's strengths give them a competitive advantage?
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c) Valuable, Rare
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Buyers will experience less bargaining power when the firm's product is undifferentiated. True or False
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FALSE
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A normative stakeholder analysis emphasizes the stakeholder issues that are likely to impact the firm's financial performance. True or False
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FALSE
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GoPro Inc. is an American manufacturer of action cameras, often used in extreme-action videography and part of the connected sport movement. Sony has a waterproof small action camera called Fast Shot. Fast Shot is which concern from Porter's Five-Force Model for GoPro?
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c) Threat of Substitutes
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Which of the following is NOT one of Porter's five forces?
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c) Stakeholder analysis
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Data envelopment Analysis (DEA) is a family of techniques that enables assessment of the weight individuals put on different attributes of a choice. True or False
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FALSE
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A company's core competencies are typically considered to be those that differentiate it strategically. True or False
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TRUE
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All of the following are questions to ask in a Stakeholder Analysis EXCEPT:
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d) When do they contribute to the organization?
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Fill in the blanks for the following question What are the 4 main types of performance measures that are included in the balanced scorecard?
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Financial perspective, __(customer)___ perspective, internal perspective, __(innovation)__ & learning
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Porter's Five Forces model and SWOT analysis are two common methods firms use to assess their current positioning. True/ or False
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FALSE
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The extended length of time and high cost of research to develop a new drug would be an example of an entry barrier for the pharmaceutical industry. True or False
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TRUE
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Which of the following is NOT true when it comes to formulating a coherent technological innovation?
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a) Typically looks 10-20 years ahead, and establishes clear milestone
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The two most commonly used quantitative methods of evaluating projects are net present value (NPV) and internal rate of return (IRR). True or False
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TRUE
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The Discount rate that makes the net present value of investment zero is known as the Discounted Cash Flow (DCF)? True or False
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FALSE
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A particular type of strategic alliance that entails significant equity investment and often establishes a new separate legal entity is:
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d) Joint Ventures
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Provide a short answer response to the following question: Before calculating net present value, what do managers first estimate?
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Answer: The cost of the project and the cash flows the project will yield.
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When using the qualitative methods for choosing projects, the screening question categories most commonly used are; role of customer, role of capabilities, and project time and cost. True or False
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TRUE
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Why do firms choose to outsource their work?
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b) Because it allows them to specialize in the activities central to their competitive advantage
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Conjoint analysis is a method of converting qualitative assessments of a choice into quantitative weights of the different criteria underlying the choice. True or False
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TRUE
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When deciding on a firm's potential collaboration efforts in reference to its strengths and weaknesses, all of the following questions are asked EXCEPT:
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B) Should we fire our current CEO and hire Nick Saban?
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In 2011, Dyesol formed a joint venture with , the fifth largest steel maker in the world to make "solar steel," and a joint venture with , one of the largest sheet glass makers in the world, to produce coated sheet-glass solar panels.
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Tata Steel and Pilkington
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Resource fit and _______ are essential for successful collaboration?
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b) Strategic fit
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Entry barriers can include such factors as:
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e) All of the above
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Speeding Horse Inc., the leader in the video game console market, is making its new generation consoles backward compatible with its previous games. This means that:
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b. it is providing a significant incentive to the owners of its previously developed consoles and games.
