Discuss how Netflix has disrupted the TV industry. correct answers · By continuing to innovate on many dimensions, Netflix was able to not only disrupt the TV industry, but also gain and sustain a competitive advantage
What is the difference between invention and innovation? correct answers · ...
BADM 449 Midterm 2 || A+ Graded Already.
Discuss how Netflix has disrupted the TV industry. correct answers · By continuing to innovate
on many dimensions, Netflix was able to not only disrupt the TV industry, but also gain and
sustain a competitive advantage
What is the difference between invention and innovation? correct answers · Invention:
o Transformation of an idea into product or process
o The modification and recombination of existing ones
· Innovation: commercialization of an invention by entrepreneurs
Provide two different reasons for why innovation diffuses. correct answers 1. Imitation by others
2. Adoption by consumers
Provide four different stakeholders who may appropriate value from an innovation correct
answers · Customers
· Suppliers
· Innovator
· Imitators and other "followers"
The profitability of an innovation depends upon (1) the value of the innovation, and (2) the
innovator's ability to appropriate the value of the innovation. Provide four factors that influence
this appropriation ability, which influence the profitability of innovation. correct answers · Legal
protection
· Complementary resources
· Imitability of the technology
· Lead time
There is no simple answer on whether it is better to be a leader or a follower when innovating.
Provide an example in which the leader was successful and an example in which the follower
was successful. correct answers · Leader - instant cameras (polaroid)
· Follower - X-Ray Scanner (General Electric)
Provide two key sources of uncertainty in technology-based industries, and provide three
strategies for managing risk. correct answers · Technological uncertainty:
· Market uncertainty:
· Cooperating with lead users:
· Limiting risk exposure:
· Flexibility:
Explain why VHS tapes (with an arguably inferior technology) won against Beta tapes (with an
arguably superior technology). correct answers Customer perception about who the winner will
be influences who the winner will be
· VHS had better management - stakeholder view
o Allowed suppliers to have some of the profit so that they could innovate.
Market Share
, Explain why the QWERTY configuration of the keyboard is inferior. Then, explain the
economic principle of why this inferior keyboard configuration persists up until now correct
answers · QWERTY is designed to be slow because it was made for the typewriter so that you
wouldn't make as many mistakes
· Still dominant because of high switching costs
Discuss standards battles and alternative technologies in the automobile industry. · What will be
the next paradigm? correct answers · Current limitations of electric vehicle adoption:
o Lack of recharging infrastructure
o 200-250 mile "range anxiety"
§ First hybrid, because of the lack of charging stations, then electric will win
What are the five phases of an industry life cycle? correct answers 1. Introduction
2. Growth
3. Shakeout
4. Maturity
5. Decline
Discuss the Apple iPhone example concerning network effects correct answers each new apple
product you purchase increases the value of the others, and when your friends have it you can
share easily with them.
Describe the concept of "crossing the chasm" and its application to the mobile phone industry
correct answers · The chasm represents the mass market, if you cross the chasm you have made
it.
· Incremental Innovation correct answers o Results from steady improvement
o Targets existing markets with existing technology
o Example: Gillete blades: from one to six!
· Radical Innovation: correct answers o Draws on novel methods and materialso
o Forms from an entirely new knowledge base
o Recombination of knowledge
o Example: X-ray technology
· Architectural Innovation: correct answers o Leverages existing technology into new markets
o Alters the architecture of a product
o A new product, with known components, used in a novel way (e.g., commercializing
xerography invention)
· Disruptive innovation: correct answers o Leverages new technologies in existing markets (e.g.,
mini-mills in the steel industry; also laptop computers)
o New product / process meets existing customer needs
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