|
61.
|
Which
of the following is not part of a culture of entrepreneurship?
A culture of entrepreneurship
is one in which the search for venture opportunities permeates every part of
the organization. The key to creating value successfully is viewing every
value-chain activity as a source of competitive advantage. In companies with
an entrepreneurial culture, everyone in the organization is attuned to
opportunities to help create new businesses.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-03 How corporations use new venture teams; business incubators; and product champions to create an internal environment and culture that promote entrepreneurial development. Level of Difficulty: 2 Medium Topic: Corporate Entrepreneurship |
|
62.
|
Common
features of a dispersed approach to corporate entrepreneurship include all of
the following except _____________.
A new venture group is
characteristic of a focused approach to entrepreneurship, while the dispersed
approach often utilizes an entrepreneurial culture and the use of product
champions. The latter may also use a top-down approach to provide support and
incentives for entrepreneurship.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-03 How corporations use new venture teams; business incubators; and product champions to create an internal environment and culture that promote entrepreneurial development. Level of Difficulty: 2 Medium Topic: Managing Innovation |
|
63.
|
In
corporations with a strong entrepreneurial culture, the willingness and
ability to change _____________.
With the dispersed approach
to entrepreneurship, the ability to change is considered to be a core
capability. This leads to a second advantage. Because of the entrepreneurial
reputation of the firm, stakeholders such as vendors, customers, or alliance
partners can bring new ideas or venture opportunities to anyone in the organization
and expect them to be well-received. Such opportunities make it possible for
the firm to stay ahead of the competition.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-03 How corporations use new venture teams; business incubators; and product champions to create an internal environment and culture that promote entrepreneurial development. Level of Difficulty: 2 Medium Topic: Corporate Entrepreneurship |
|
64.
|
Product
champions _____________.
Product (or project)
champions are those individuals working within a corporation who bring entrepreneurial
ideas forward, identify what kind of market exists for the product or
service, find resources to support the venture, and promote the venture
concept to upper management.
|
|
AACSB:
Analytic
Blooms: Remember Learning Objective: 12-03 How corporations use new venture teams; business incubators; and product champions to create an internal environment and culture that promote entrepreneurial development. Level of Difficulty: 1 Easy Topic: Corporate Entrepreneurship |
|
65.
|
Project
______________ involves justifying whether an opportunity is attractive in
the marketplace; project ______________ involves evaluating the strategic and
economic impact of a new venture.
In the project definition
stage, an opportunity has to be justified in terms of its attractiveness in
the marketplace and how well it fits with the other strategic objectives of
the corporation. For a project to gain impetus, its strategic and economic
impact must be supported by senior managers who have experience with similar
projects. It then becomes an embryonic business with its own organization and
budget.
|
|
AACSB:
Analytic
Blooms: Remember Learning Objective: 12-03 How corporations use new venture teams; business incubators; and product champions to create an internal environment and culture that promote entrepreneurial development. Level of Difficulty: 1 Easy Topic: Corporate Entrepreneurship |
|
66.
|
On
average, approximately what percentage of corporate ventures reaches
profitability within six years?
Not all corporate venturing
efforts are financially rewarding. In terms of financial performance,
slightly more than 50 percent of corporate venturing efforts reach
profitability (measured by ROI) within six years of their launch.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-04 How corporate entrepreneurship achieves both financial goals and strategic goals. Level of Difficulty: 2 Medium Topic: Corporate Entrepreneurship |
|
67.
|
Financial
reasons for undertaking internal corporate venturing include
_____________.
Corporations expect a higher
return from corporate venturing projects than from normal operations. But
there are other important strategic considerations as well that are not
financial. These include undertaking a corporate venture to strengthen the
competitive position, enter into new markets, expand capabilities by learning
and acquiring new knowledge, and build the base of corporation resources and
experience.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-04 How corporate entrepreneurship achieves both financial goals and strategic goals. Level of Difficulty: 2 Medium Topic: Corporate Entrepreneurship |
|
68.
|
Strategic
reasons for undertaking a corporate venture do not include
_____________.
Corporations expect a higher
return from corporate venturing projects than from normal operations. But
there are other important strategic considerations as well that are not
financial. These include undertaking a corporate venture to strengthen the
competitive position, enter into new markets, expand capabilities by learning
and acquiring new knowledge, and build the base of resources and experience
of the corporation.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-04 How corporate entrepreneurship achieves both financial goals and strategic goals. Level of Difficulty: 2 Medium Topic: Corporate Entrepreneurship |
|
69.
|
One
of the following is not a question that should be answered when evaluating
the performance of corporate venturing efforts. Which is it?
Three questions should be
used to assess the effectiveness of the venturing initiatives of the firm:
Are the products or services offered by the venture accepted in the
marketplace?; Are the contributions of the venture to the internal
competencies and experience of the corporation valuable?; Is the venture able
to sustain its basis of competitive advantage? External funding may not be
critical to success.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-04 How corporate entrepreneurship achieves both financial goals and strategic goals. Level of Difficulty: 2 Medium Topic: Corporate Entrepreneurship |
|
70.
|
A
manager whose role is to question the viability of corporate venture projects
is known as a(n)
In contrast to product
champions and other entrepreneurial enthusiasts within the corporation, exit
champions are willing to question the viability of a venture project. By
demanding hard evidence and challenging the belief system that is carrying an
idea forward, exit champions hold the line on ventures that appear shaky.
|
|
AACSB:
Analytic
Blooms: Remember Learning Objective: 12-04 How corporate entrepreneurship achieves both financial goals and strategic goals. Level of Difficulty: 1 Easy Topic: Corporate Entrepreneurship |
|
71.
|
Whereas
______________ are willing to violate procedures and operate outside normal
channels, ______________ gather hard data and develop a strong case for why a
project should be killed.
Product champions are often
thought to be willing to violate procedures and operate outside normal
channels. Exit champions reduce ambiguity by gathering hard data and
developing a strong case for why a project should be killed.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-04 How corporate entrepreneurship achieves both financial goals and strategic goals. Level of Difficulty: 2 Medium Topic: Corporate Entrepreneurship |
|
72.
|
Options
exist when the owner of the option has _____________.
Options exist when the owner
of the option has the right but not the obligation to engage in certain types
of transactions. The most common are stock options. A stock option grants the
holder the right to buy (call option) or sell (put option) shares of the
stock at a fixed price (strike price) at some time in the future.
|
|
AACSB:
Analytic
Blooms: Remember Learning Objective: 12-05 The benefits and potential drawbacks of real options analysis in making resource deployment decisions in corporate entrepreneurship contexts. Level of Difficulty: 1 Easy Topic: Real Options Analysis: A Useful Tool |
|
73.
|
Real
options analysis is most appropriate when _____________.
ROA is appropriate to use
when investments can be staged; a smaller investment up front can be followed
by subsequent investments. Real options can be applied to an investment
decision that gives the company the right, but not the obligation, to make
follow-on investments.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-05 The benefits and potential drawbacks of real options analysis in making resource deployment decisions in corporate entrepreneurship contexts. Level of Difficulty: 2 Medium Topic: Real Options Analysis: A Useful Tool |
|
74.
|
One
of the pitfalls of real options analysis is that managers may have an
incentive and know-how to game the system and back-solve a formula to get a
proposal approved. This can give rise to _____________.
Managers may have an
incentive and the know-how to game the system. If managers know that a
certain option value must be met in order for the proposal to get approved,
they can back-solve the model to find a variance estimate needed to arrive at
the answer that upper management desires. This is an example of an agency
problem that is typically inherent in investment decisions. A manager may
have something to gain by not acting in owner best interests, or the
interests of managers and owners are not co-aligned.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-05 The benefits and potential drawbacks of real options analysis in making resource deployment decisions in corporate entrepreneurship contexts. Level of Difficulty: 2 Medium Topic: Real Options Analysis: A Useful Tool |
|
75.
|
Which
of the following is not one of the dimensions of entrepreneurial
orientation?
An entrepreneurial
orientation has five dimensions that permeate the decision-making styles and
practices of the members of the firm: autonomy, innovativeness,
proactiveness, competitive aggressiveness, and risk taking. These factors
work together to enhance the entrepreneurial performance of a firm.
|
|
AACSB:
Analytic
Blooms: Remember Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 1 Easy Topic: Entrepreneurial Orientation |
|
76.
|
Which
of the following statements about skunkworks is false?
Skunkworks are independent
work units, often physically separate from corporate headquarters. They allow
employees to get out from under the pressures of their daily routines to
engage in creative problem solving.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 2 Medium Topic: Entrepreneurial Orientation |
|
77.
|
After
15 teams created 128 different phones, Chris Galvin, former CEO of Motorola,
recently eliminated the autonomous teams being used to develop new wireless
phones. This was necessary because such teams _____________.
Autonomous teams often lack
coordination. Excessive decentralization has a strong potential to create
inefficiencies, such as duplication of effort and wasting resources on
projects with questionable feasibility. For example, Chris Galvin, former CEO
of Motorola, scrapped the skunkworks approach the company had been using to
develop new wireless phones. Fifteen teams had created 128 different phones,
which led to spiraling costs and overly complex operations.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 2 Medium Topic: Entrepreneurial Orientation |
|
78.
|
Which
of the following dimensions of entrepreneurial orientation is described as a
forward-looking perspective characteristic of a marketplace leader that has
the foresight to seize opportunities?
Proactiveness is a forward-looking
perspective characteristic of a marketplace leader that has the foresight to
seize opportunities in anticipation of future demand.
|
|
AACSB:
Analytic
Blooms: Remember Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 1 Easy Topic: Entrepreneurial Orientation |
|
79.
|
Which
of the following dimensions of entrepreneurial orientation is described as an
independent action by an individual or team aimed at bringing forth a
business concept or vision and carrying it through to completion?
Autonomy is an independent
action by an individual or team aimed at bringing forth a business concept or
vision and carrying it through to completion.
|
|
AACSB:
Analytic
Blooms: Remember Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 1 Easy Topic: Entrepreneurial Orientation |
|
80.
|
One
of the following statements about innovativeness is not true. Which is
it?
Innovativeness refers to
efforts of a firm to find new opportunities and novel solutions. It involves
creativity and experimentation that result in new products, new services, or
improved technological processes.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 2 Medium Topic: Entrepreneurial Orientation |
|
81.
|
According
to the text, which of the following is not one of the methods companies can
use to enhance their competitive position via innovativeness?
Innovativeness requires that
firms depart from existing technologies and practices and venture beyond the
current state of the art. Two innovation techniques that can be used are:
foster creativity and experimentation, and invest in new technology, R and D,
and continuous improvement.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 2 Medium Topic: Entrepreneurial Orientation |
|
82.
|
The
benefits gained by firms that are the first to enter new markets, establish
brand identity, and/or adopt new technologies are known as
_____________.
The benefit gained by firms
that are the first to enter new markets, establish brand identity, implement
administrative techniques, or adopt new operating technologies in an industry
is called first mover advantage.
|
|
AACSB:
Analytic
Blooms: Remember Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 1 Easy Topic: Entrepreneurial Orientation |
|
83.
|
Amazon
was able to define the online bookselling market by entering the market early
and defining the user experience. This is an example of _____________.
Being a first mover provides
companies with an ability to shape the playing field and shift competitive
advantages in their favor. Amazon was able to define the online bookselling
market by entering the market early and defining the user experience. They
further leveraged their position as an early mover when moving into other
retailing ventures and later into cloud computing. This proactiveness technique
involves introducing new products or technological capabilities ahead of the
competition.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 2 Medium Topic: Entrepreneurial Orientation |
|
84.
|
According
to the text, firms that want to enhance their entrepreneurial position by
being competitively aggressive should _____________.
One competitive
aggressiveness technique is to enter markets with drastically lower prices.
An example is California-based Zimbra, Inc. By using open-source software, it
has become a leader in messaging and collaboration software. Its product
costs about one third less than its direct competitor Microsoft Exchange.
Zimbra now has over 60 million users.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 2 Medium Topic: Entrepreneurial Orientation |
|
85.
|
One
of the following is not a type of risk that executives must address. Which is
it?
Three types of risk that
organizations and their executives face are business risk, financial risk,
and personal risk.
|
|
AACSB:
Analytic
Blooms: Understand Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 2 Medium Topic: Entrepreneurial Orientation |
|
86.
|
Which
kind of risk taking requires that a company borrow heavily or commit a large
portion of its resources in order to grow?
Financial risk taking
requires that a company borrow heavily or commit a large portion of its
resources in order to grow. In this context, risk is used to refer to the
risk/return trade-off that is familiar in financial analysis.
|
|
AACSB:
Analytic
Blooms: Remember Learning Objective: 12-06 How an entrepreneurial orientation can enhance a firm's efforts to develop promising corporate venture initiatives. Level of Difficulty: 1 Easy Topic: Entrepreneurial Orientation |
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