______________ refers to efforts to create designs and applications of technology to develop new products, while ______________ refers to efforts to improve the efficiency of organizational systems such as manufacturing and operations.

42.

______________ refers to efforts to create designs and applications of technology to develop new products, while ______________ refers to efforts to improve the efficiency of organizational systems such as manufacturing and operations.    A.  Radical innovation; incremental innovation B.  Breakthrough innovation; instrumental innovation C.  Product innovation; process innovation D.  Product innovation; service innovation Product innovation refers to efforts to create product designs and applications of technology to develop new products for end users. Process innovation, by contrast, is typically associated with improving the efficiency of an organizational process, especially manufacturing systems and operations.

AACSB: Analytic Blooms: Remember Learning Objective: 12-01 The importance of implementing strategies and practices that foster innovation. Level of Difficulty: 1 Easy Topic: Managing Innovation

43.

Whereas ______________ are often associated with a low cost leader strategy, ______________ are frequently an important aspect of a differentiation strategy.    A.  process innovations; product innovations B.  product innovations; service innovations C.  radical innovations; instrumental innovations D.  marketing innovations; management innovations Process innovations are often associated with overall cost leader strategies, because the aim of many process improvements is to lower the costs of operations. Product innovations are commonly associated with a differentiation strategy. Firms that differentiate by providing customers with new products or services that offer unique features or quality enhancements often engage in product innovation.

AACSB: Analytic Blooms: Understand Learning Objective: 12-01 The importance of implementing strategies and practices that foster innovation. Level of Difficulty: 2 Medium Topic: Managing Innovation

44.

Incremental innovations _____________.    A.  are usually highly disruptive B.  usually represent technological breakthroughs C.  are usually small improvements in products and processes D.  nearly always can be patented Incremental innovations enhance existing practices or make small improvements in products and processes. They may represent evolutionary applications within existing paradigms of earlier, more radical innovations.

AACSB: Analytic Blooms: Remember Learning Objective: 12-01 The importance of implementing strategies and practices that foster innovation. Level of Difficulty: 1 Easy Topic: Managing Innovation

45.

Radical innovations _____________.    A.  often result in quick profits B.  often represent technological breakthroughs C.  usually apply to products and processes simultaneously D.  usually cannot be patented Radical innovations produce fundamental changes by evoking major departures from existing practices. These breakthrough innovations usually occur because of technological change. They tend to be highly disruptive and can transform a company or even revolutionize a whole industry.

AACSB: Analytic Blooms: Remember Learning Objective: 12-01 The importance of implementing strategies and practices that foster innovation. Level of Difficulty: 1 Easy Topic: Managing Innovation

46.

______________ produce fundamental changes that can transform a company or even revolutionize an industry, while ______________ enhance existing practices and often represent evolutionary applications of fundamental breakthroughs.    A.  Technological breakthroughs; product-market breakthroughs B.  New technologies; new paradigms C.  Incremental innovations; radical innovations D.  Radical innovations; incremental innovations Radical innovations tend to be highly disruptive and can transform a company or even revolutionize a whole industry. Incremental innovations enhance existing practices or make small improvements in products and processes. They may represent evolutionary applications within existing paradigms of earlier, more radical innovations.

AACSB: Analytic Blooms: Remember Learning Objective: 12-01 The importance of implementing strategies and practices that foster innovation. Level of Difficulty: 1 Easy Topic: Managing Innovation

47.

Innovations that extend sales in an existing market, usually by enabling new products or services to be sold at higher margins are known as _____________.    A.  radical innovations B.  disruptive innovations C.  technology innovations D.  sustaining innovations Sustaining innovations are those that extend sales in an existing market, usually by enabling new products or services to be sold at higher margins.

AACSB: Analytic Blooms: Remember Learning Objective: 12-01 The importance of implementing strategies and practices that foster innovation. Level of Difficulty: 1 Easy Topic: Managing Innovation

48.

Which of the following is not characteristic of a disruptive innovation?    A.  It is usually more sophisticated technologically. B.  It appeals to less demanding customers. C.  It is typically a less expensive solution for meeting a need. D.  It usually takes root in a new market or the low-end of an existing market. Disruptive innovations are technologically simpler and less sophisticated than currently available products or services. They appeal to less demanding customers who are seeking more convenient, less expensive solutions. They take time to take effect and only become disruptive once they have taken root in a new market or low-end part of an existing market.

AACSB: Analytic Blooms: Understand Learning Objective: 12-01 The importance of implementing strategies and practices that foster innovation. Level of Difficulty: 2 Medium Topic: Managing Innovation

49.

Which of the following is not a dilemma faced by corporations trying to manage the innovation process?    A.  launching incremental rather than preemptive innovations B.  emphasizing marketing over management innovations C.  preferring experience over initiative D.  choosing internal rather than external staffing Innovation is difficult in part because the process involves so many choices. These choices present five dilemmas that companies must wrestle with when pursuing innovation. These include decisions such as: seeds versus weeds, experience versus initiative, internal versus external staffing, building capabilities versus collaborating, and incremental versus preemptive launch.

AACSB: Analytic Blooms: Understand Learning Objective: 12-02 The challenges and pitfalls of managing corporate innovation processes. Level of Difficulty: 2 Medium Topic: Managing Innovation

50.

The innovation dilemma known as building capabilities versus collaborating refers to _____________.    A.  developing innovation skills internally versus partnering with qualified outsiders B.  building innovative products in-house versus outsourcing C.  building credibility by launching products ahead of potential collaboration partners D.  launching a product incrementally Innovation projects often require new sets of skills. The decision to build capabilities versus collaborating with others means that firms can seek help from other departments or partner with other companies that bring resources and experience as well as share costs of development.

AACSB: Analytic Blooms: Understand Learning Objective: 12-02 The challenges and pitfalls of managing corporate innovation processes. Level of Difficulty: 2 Medium Topic: Managing Innovation

51.

The innovation dilemma known as seeds versus weeds refers to _____________.    A.  choosing to pursue radical rather than incremental innovations B.  choosing to pursue product rather than process innovations C.  promoting organizational stars onto innovation teams rather than involving all employees in innovation efforts D.  choosing to pursue investment in one innovative idea over another Most companies have an abundance of innovative ideas. They must decide which of these is most likely to bear fruit (Seeds) and which should be cast aside (Weeds).

AACSB: Analytic Blooms: Understand Learning Objective: 12-02 The challenges and pitfalls of managing corporate innovation processes. Level of Difficulty: 2 Medium Topic: Managing Innovation

52.

Creative intelligence involves the ability to see patterns in data, integrating data, and making insights. Which of the following are the four patterns of action managers should take in order to develop more creative and higher potential innovations?    A.  observing, experimenting, cataloging, and networking B.  questioning, observing, integrating, and networking C.  questioning, observing, experimenting, and networking D.  observing, experimenting, cataloging, and integrating The key attribute that firms need to develop in their managers in order to improve their innovative potential is creative intelligence. Creative intelligence is driven by a core skill of associating (the ability to see patterns in data and integrating different questions, information, and insights) and four patterns of action: questioning, observing, experimenting, and networking.

AACSB: Analytic Blooms: Understand Learning Objective: 12-02 The challenges and pitfalls of managing corporate innovation processes. Level of Difficulty: 2 Medium Topic: Managing Innovation

53.

Individuals with highly innovative DNA traits have the ability to connect seemingly unrelated questions, problems, and ideas from different fields that allows them the opportunity to creatively see opportunities others miss. This is referred to as _____________.    A.  associating B.  integrating C.  visioning D.  allocating Those with the innovator DNA trait called associating have the ability to connect seemingly unrelated questions, problems, and ideas from different fields. This allows them to creatively see opportunities that others miss.

AACSB: Analytic Blooms: Understand Learning Objective: 12-02 The challenges and pitfalls of managing corporate innovation processes. Level of Difficulty: 2 Medium Topic: Managing Innovation

54.

In the 1990s, DuPont used its knowledge of plastics to develop biodegradable plastic products. This is an example of _____________.    A.  focusing on process rather than product innovation B.  defining its innovation efforts within the context of its strategic envelope C.  radical innovation D.  public relations, since plastics are not biodegradable By defining the strategic envelope, the scope of the innovation efforts of a firm, firms ensure that their innovation efforts are not wasted on projects that are outside their domain of interest. In the early 1990s, DuPont sought to use its knowledge of plastics to identify products to meet a growing market demand for biodegradable products. By trying different applications and formulations demanded by customers, the company was finally able to create a product that could be produced economically and had market appeal.

AACSB: Analytic Blooms: Understand Learning Objective: 12-02 The challenges and pitfalls of managing corporate innovation processes. Level of Difficulty: 2 Medium Topic: Managing Innovation

55.

Which of the following is not an advantage of collaborating with strategic partners in order to innovate?    A.  obtaining skills and new knowledge from outside sources B.  making firms identify their own strengths and weaknesses C.  managers clarifying what an innovation project requires to be successful and who will accomplish it D.  decreasing economies of scale Innovation partners provide the skills and insights that are needed to make innovation projects succeed. Strategic partnering requires firms to identify their strengths and weaknesses and make choices about which capabilities to leverage, which need further development, and which are outside the current or projected scope of operations of the firm. To choose partners, firms need to ask what competencies they are looking for and what the innovation partner will contribute.

AACSB: Analytic Blooms: Understand Learning Objective: 12-02 The challenges and pitfalls of managing corporate innovation processes. Level of Difficulty: 2 Medium Topic: Managing Innovation

56.

McGrath and Keil researched the types of human resource management practices that effective firms use to capture value from their innovation efforts. Which of the following is not one of their findings?    A.  Create innovation teams with experienced players. B.  Require that employees serve in the new venture group as part of their career climb. C.  Transfer people to mainstream management positions after they have experience in the new venture group. D.  Integrate the performance of individuals with the performance of the innovation. Separate the performance of individuals from the performance of the innovation. Otherwise, strong players may feel stigmatized if the innovation effort they worked on fails.

AACSB: Analytic Blooms: Understand Learning Objective: 12-02 The challenges and pitfalls of managing corporate innovation processes. Level of Difficulty: 2 Medium Topic: Managing Innovation

57.

In a typical corporation, which of the following factors does not determine how entrepreneurial projects will be pursued?    A.  structural features that guide and constrain action B.  corporate culture C.  organizational systems that foster learning and manage rewards D.  number of innovation projects in the pipeline In a typical corporation, many factors determine how entrepreneurial projects will be pursued, including: corporate culture, leadership, structural features that guide and constrain action, and organizational systems that foster learning and manage rewards.

AACSB: Analytic Blooms: Understand Learning Objective: 12-02 The challenges and pitfalls of managing corporate innovation processes. Level of Difficulty: 2 Medium Topic: Corporate Entrepreneurship

58.

Two common forms of a focused approach to corporate entrepreneurship include ______________ and _____________.    A.  internal collaboration; internal venturing B.  social capital; collaboration capital C.  business incubators; new venture groups D.  focus groups; business incubators Firms using a focused approach typically separate the corporate venturing activity from the other ongoing operations of the firm. CE is usually the domain of autonomous work groups that pursue entrepreneurial aims independent of the rest of the firm. Two forms, new venture groups (NVGs) and business incubators, are among the most common types of focused approaches.

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

59.

According to the text, _____________, which support fledgling startups are often used to pursue specific entrepreneurial ventures developed by _____________.    A.  collaboration partners; strategic partners B.  business incubators; new venture groups C.  product champions; corporate venture capitalists D.  lower-level managers; upper-level managers Business incubators are designed to hatch new businesses. They are a type of corporate new venture group with a somewhat more specialized purpose, to support and nurture fledgling entrepreneurial ventures until they can thrive on their own as stand-alone 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

60.	Which of the following do corporate business incubators typically not provide?    A.  physical space B.  mentoring C.  funding D.  student interns Incubators typically provide some or all of the following five functions: funding, physical space, business services, mentoring, and networking.

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