IM600-01 – Managing Technological Innovations, Fall 2023

Instructor: Dr. John D. Dudley

Email: [email protected];
Office phone: (573) 651-2658
Office Location: SEABGH 213D

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Innovation:
 Technological Innovation: The act of introducing a new device, method, or material for
application to commercial or practical objectives.
 Becoming increasingly more important:
 Market globalization
 Advances in information technology
 Example
 CAD/CAM
o Visualization
o Quick changes/pivots
o Increased efficiency
o 3D Printing
 Product lifecycles (product introduction to withdrawal) are
continuing to decrease.
 Examples:
 Computer Software… less than a year.
 Computer Hardware & Electronics… 1-2 years.
Home appliances… 1.5 to 3 years
o In this day and age, you are generally $$
ahead to purchase a new television, washer, dishwasher, etc. rather than fixing
one.
 “The enterprise that does not innovate ages and declines. And in period of rapid change such
as the present, the decline will be fast.”
- Peter Drucker (Founder of Modern Management)
 Scientific Management
- Frederick Winslow Taylor
 Principles of Management
- Henri Fayol
 Division of Work
 Equity
 Unity of Command
 Discipline

 Impact on Society:
 Increased competition among industries.
 Increase in GDP.
 Moore’s Law

Innovation – Impact

 Consequences may be:

 Anticipated:
o Intended and desired (Making $$)
o Not desired but common or probable (Losing $$)
o Not desired and improbable (Loss of interest in
gaming?)
 Unanticipated:
o Desirable (Esports – electronic gaming?)
o Undesirable (online gaming addiction?)
 Why do we have unintended consequences of technology (9/11)?
 Complexity – various components of a system
 Instrasparence – unforeseen elements of an endeavor
 Dynamics – ever changing
 Ignorance & Mistaken Hypotheses – simply not knowing or model is wrong

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  Innovation By Industry & Strategy
 Most innovative ideas are unsuccessful due to:
o Technical infeasibilities (VR?)
o Insufficient economic returns (Metaverse?)
o Successful innovators have clearly defined innovation strategies & management
processes:
 TOYOTA: Parallel set narrowing process
o As sets get smaller, detail increases.

Question 1
___________ is the act of introducing a new device, method, or material for application to commercial
or practical objectives.
Technological Innovation

Incorrect Question 2
___________ is used to approximate the size of an economy by calculating the value of all services and
goods in that economy.
Moore’s Law

Incorrect Question 3
Intrasparence refers to a property of a system which causes that system to spontaneously change.
False

Question 4
Unity of command, division of work, and equity are principles of management attributed to the work of
Frederick Taylor. False

Question 5
According to Schilling, most innovative ideas are unsuccessful due to technical infeasibilities and/or
insufficient economic returns. True

Question 1
Innovation can arrive from many different sources such as individuals, colleges, and government
funded research. True

Question 2
An environment which supports and rewards creative ideas is conducive for individual inspiration.
True

Question 3
Applied research is best defined as research which increases scientific knowledge, regardless of
potential commercial application. False

Question 4
In order to maximize a person's creative capacity in a specific field, it is always best have extensive
knowledge pertaining to that field. False

Question 5
A radical innovation is an innovation that is very new and different from prior solutions.
True

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Question 6
The creation and utilization of the scissor truss in residential and commercial architecture is an example
of an architectural innovation. False

Question 7
Regarding new technologies, improvement progress and performance is oftentimes slow at first
because of poor initial understanding. True

Question 8
Configuration design in engineering involves picking existing components from a list and finding
values to satisfy equations. False

Question 9
Technological diffusion can be defined as how a specific technology spreads throughout a population
over time. True

Question 10
Tesla's implementation and utilization of the Giga-Press to rapidly increase production of EV chassis is
an example of a product innovation. False

Discussion 3: Dominant Design Forum Discussion

Discussion 4: Market Entry Forum Discussion

1. What are some advantages of entering a market early? Are there any advantages to entering a market late?

2. Name a successful (a) first mover (pioneer), (b) early follower, and (c) late entrant. Also, identify unsuccessful
examples of each.

3. Respond to a minimum of two of your classmates with the following: (1) Explain why you agree or disagree
with their choice of a successful first mover, early follower, and/or late entrant. (2) Explain why you agree or
disagree with their choice of an unsuccessful first mover, early follower, and/or late entrant.

Question 1
A "dominant design" is a product or process architecture which is foremost in a product category.
True
Question 2
The value of a good to a user tends to decrease as the number of users of the same or similar good increases.
False
Question 3
When comparing a new technology to an existing technology, customers consider a mix of objective and
subjective information. True

Question 4
Research has shown that the cost of a product increases as the number of users decreases.
True
Question 5
If substantial effort is required to learn a computer platform, users are more likely to invest their time and effort
in learning a platform which is already widely used. True

Question 6
The more a technology is used, the more worthless it becomes.
False
Question 7
A firm that captures a technology early may be able to keep customers even if a superior technology emerges.
True

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Question 8
Being the first to develop and introduce an unproven new technology is inexpensive and without much risk.
False
Question 9
One major advantage successful pioneers of new technologies have is the ability to shape customer expectations
in terms of cost, form, and function. True

Question 10
One disadvantage pioneers of new technologies face is uncertainty regarding what customers require.
True

Week Seven Homework - Chat GPT

1. What are the specific strengths you believe ChatGPT possesses that have encouraged so many people to
create an account and make use of artificially intelligent chatbot in such a short period of time?
2. What competitive advantage(s) does ChatGPT have over its competition?
3. Lastly, a sustained competition can be defined as a unique advantage that allows a company to
outperform its competitors over a long period of time. Considering this, do you believe OpenAI and/or
ChatGPT have any sources of sustainable competitive advantage?

Discussion 5: Chapter Six Discussion Padlet

Strength VS Competitive Advantage VS Sustainable Competitive Advantage Strength, competitive advantage,
and sustainable competitive advantage are related concepts in the field of business strategy, but they have distinct
meanings and implications for a company:

1. Company Strength: Company strength refers to the inherent capabilities, resources, and attributes that a
company possesses, which can give it a competitive edge in the market. These strengths can include financial
stability, a strong brand reputation, a skilled workforce, technological expertise, efficient processes, and access to
key distribution channels, among others. Strengths are essentially the positive attributes or resources that a
company can leverage to achieve its business objectives. However, strengths alone do not guarantee a sustained
competitive advantage.

2. Competitive Advantage: Competitive advantage is a broader concept that encompasses the qualities or factors
that allow a company to outperform its rivals or achieve superior results in the marketplace. Competitive
advantages can be based on various elements such as cost leadership (producing goods or services at a lower cost
than competitors), product differentiation (offering unique or higher-quality products/services), innovation,
market positioning, or operational efficiency. Competitive advantage is relative and can change over time as
market conditions and competition evolve.

3. Sustainable Competitive Advantage: Sustainable competitive advantage is a more enduring and resilient form
of competitive advantage that is not easily replicated or eroded by competitors. It represents a long-term
advantage that allows a company to maintain its superior performance and market position over an extended
period. Sustainable competitive advantages can stem from unique resources, patented technologies, strong brand
loyalty, regulatory barriers, economies of scale, and other factors that create substantial barriers to entry or
imitation for competitors. Importantly, sustainable competitive advantages are characterized by their durability
and ability to withstand changes in the business environment.

In summary, while company strengths are the inherent resources and capabilities a company possesses,
competitive advantage represents the factors that enable a company to outperform rivals, and sustainable
competitive advantage is a long-term, difficult-to-replicate advantage that allows a company to maintain its
superior position in the market. Companies aim to develop and leverage their strengths to create competitive
advantages, and the most valuable ones are those that can be sustained over time.

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Question 1
If there are numerous companies offering the same product or service, the companies will typically experience
little direct rivalry with each other providing they are highly differentiated. True

Question 2
Utilitarianism is a type of consequentialism. True

Question 3
The degree to which a firm is reliant on a few customers will decrease the customer's bargaining power, and vice
versa. False

Question 4
Entry barriers can be defined as conditions which make it easy or cheap for new firms to enter an particular
industry. False

Question 5
As the number of suppliers increases, a firms ability to negotiate decreases. False

Question 6
Deontology is a theory in ethics which determines the moral correctness of an action based on whether the
outcome of that action is inherently right or inherently wrong. False
Deontology is concerned with the action itself, not consequences/outcome.

Question 7
Both qualitative and quantitative data are often considered when firms are choosing which innovative projects to
invest in. True

Question 8
Net Present Value (NPV) is a way to determine the financial value of a project or investment by comparing the
money you expect to get in the future with the money you have to spend now. True

Question 9
Collecting qualitative data may involve utilizing a Likert scale to ascertain feedback from customers pertaining
to the quality of a particular product and/or service. False

Question 10
Regardless of the method(s) used to determine the viability of a potential endeavor, estimation and speculation
are involved. True

ETHICS, TECHNOLOGY, & INNOVATION

Terms: Consider the following:

 Consequentialism  Cheating
 Utilitarianism  Stealing
 Deontology  Bullying
 Divine Command Theory  Abortion
 Psychological Egoism  The Environment – Instrumental or Inherent Value??

Prisoner’s Dilemma:
 Two prisoners accused of stealing from a third. The prosecutor needs a confession from one with the
following plea-bargain deal:
- A: Confess and you get off with 5yrs and your partner will get 15yrs.
- B: If neither confess, both go free.
- C: If both confess, you get 10 years each.

 Obviously “B” is the best option.

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  What the accuse want most of all is to avoid spending 15 years in jail.
 Each reasons that if he/she confesses and their partner doesn’t they get 5 years.
 If the partner confesses too…he/she gets 10 years…far better than 15 years.
 People will naturally do anything to avoid the worst-case scenario…so they both confess.

Violations of Established World Orders:

 Scientific or technological breakthroughs make possible actions that some believe to violate the
“natural” order of things.
 Deontological arguments:
- “Intervention-free order is natural and ‘good’ while technology is artificial, therefore, ‘bad’.
- Something has been done for a long time i.e. ‘natural way’ and should continue being done that way
without technological intervention.

What is “Natural?”
 E.g. A divine being created the natural order, it should not be tampered with” by humans; however….
- E.g. The divine being endowed humans with creative powers, thereby enabling them to intervene in
the ‘natural’ order.
- Long-stinkingness’ cannot by itself justify the view that a practice is ‘natural’ or ‘proper’; some
innovative technical practices eventually come to seem natural.

Exceptionless Moral & Wrongful Intention Principles:

 Exceptionless Moral: Any course of action sure to result in the destruction of innocent civilian lives in
time of war is ethically impermissible.
 Wrongful Intention: To form the intention to do what one knows to be wrong is itself wrong.
- Launching a nuclear attack.
- Forming the intention to launch an attack, if attacked.
- Launching the attack=WRONG Intention to launch attack to avoid attack, thus avoiding loss of
innocent civilian life=RIGHT… A MORAL PARADOX!!!

Distribution of Science or Technology Related Benefits:

 Deontological: Medical care is a basic human right…it is morally unthinkable that a person be denied
treatment because of financial situation, age, etc.
 Consequentialists: Individuals do not have the right to draw, without limit, on public insurance
company funds to have their family members lives extended regardless of outlook for improvement.

Infliction of Harm Without Prior Consent:

 Consequentialist: Activities that promise future benefits to humans but inflict suffering on existing
animals are ethically permissible.
 Deontologists: Since consent of laboratory animals cannot be obtained, research activities that produce
suffering for animals is ethically wrong.

Precipitated Value Conflicts:

 When scientific or technology advances allow something that precipitates a value conflict, between two
or more cherished values of one and the same party.
- E.g. 1986 adoption agency, 2-month old girl whose mother had Huntington’s disease, parents indicated
that they didn’t want her if she had the gene, the geneticist declined to test her on the grounds that it would be
unethical to test someone who couldn’t exercise her right of entitlement not to know.

Engendered “Positive” Rights:

 Irrevocable entitlements that people supposedly have simply because they are human.
- The right to life.
- The right to privacy.
- The right to liberty; i.e., freedom.

Public Harms of Aggregation:

 Effect of a large # of people doing the same thing that causes substantial harm to the environment.
- Pollutants emitted by automobiles.
- Predetermination of the sex of one’s offspring causing sexual imbalances, male aggressiveness, etc.

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Problems of Execution:
 Distributive Justice: A project may cause a degree of risk to people's safety, health, or property without
their consent. E.g. Geo-Engineering & Climate Change
 Whistle-Blowing: Employees become aware of negligence on the part of their employer, colleagues,
etc.; do they tell or not?
 Consideration of Long-Term Effects: Not taking into account long term effects of an endeavor. E.g.
Genetically Modified Foods

Innovation:
 Consider the following innovations:
1. Electric Vehicles
2. Artificial Intelligence
3. Human Gene Editing
4. Facial Recognition Technology
5. Autonomous Weapons
6. Deepfake Technology

Discussion 5: Ethics, Technology, & Innovation

1. Should parents have the choice to design their own children? Why or why not?
2. If parents are having fertility problems and decide to use in vitro fertilization, should they be able to use
technology to pick the sex of their child?
3. If you could predetermine your child's genetics and characteristics prior to them being born... would
you? Why or why not?
4. In your opinion which ethical viewpoint, consequentialism OR deontology OR utilitarianism, is the most
appropriate when considering the previous three questions. Explain.

Discussion 7: Innovation & Collaboration Padlet

a past successful OR non-successful collaboration between two or more companies. This collaboration may be
any type of collaborative arrangement; e.g. strategic alliance, joint venture, outsourcing agreement, etc.

Innovation & Collaboration(Chapter-08)

Factors Influencing Collaboration:

 Partner has capabilities or other resources.
 Proprietary technology vulnerability (new & existing).
 Importance of control of process and innovation produced.
 Role of development in building the firm’s own capabilities.

Why to Avoid Collaboration:

 Firm already possesses necessary capabilities.
 Concerns about protecting technology and/or trade secrets.
 Preference for in-house development rather than using another firm’s capabilities.

Strategic Alliances:
 May involve simple pooling of resources for a particular project and/or capabilities between partners.

Joint Venture:
 A partnership between firms that involve and equity investment.
 Benefits of joint ventures:
- Share costs and risks.
- Potential for utilizing capabilities between firms.

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Licensing:
 Selling the rights to use a particular technology:
 E.g.:
- Microsoft licensed its Windows operation system to computer manufacturers for installation on their
machines.
- In return Microsoft receives a fee for each copy of Windows installed on their computers.

Outsourcing:
 Accessing another firm’s expertise, scale, or other advantages.
- E.g.: Promotional material for a business such as hats, t-shirts, etc.
 Enables firms to focus on their core capabilities & competencies.

Conclusion:
 Successful collaboration requires choosing partners that have both a resource fit and a strategic fit.
 Successful collaboration also requires that partners understand their rights and obligations and are held
accountable to their end of the bargain!

Question 1
A strategic alliance is a partnership between firms that involves an equity investment. True

Question 2
Collaboration may include taking advantage of another firm's expertise in a particular area. True

Question 3
A firm's desire to protect their trade secret oftentimes encourages them to collaborate with other firms,
particularly in areas of manufacturing and distribution. False

Question 4
Successful collaboration requires choosing partners that have both a resource fit and a strategic fit.
True
Question 5
There is little to no risk when making the decision to access another firm's skills and/or resources through
collaboration. False

Question 6
The ability in which a competitor can imitate an innovation is irrelevant as to whether or not the novelty is a
success. False

Question 7
A trademark can be described as an indicator used to recognize the source of a good or service. True

Question 8
A copyright refers to an intellectual property safeguard which includes the protection of a process and/or
machine. False

Question 9
The desire to maintain a competitive advantage encourages many firm's to acquire some sort of intellectual
property protection. True

Question 10
It is always in a firm's best interest to protect their ideas and inventions. False

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 Protecting Innovation(Chapter-09)

 Peer-to-peer file sharing app founded in June 1999 by

Shawn Fanning & Sean Parker.
 Used primarily for MP3 audio files.
 Due to copyright infringements, Napster was forced
to cease operations in 2001.

 Free peer-to-peer file sharing app for Windows & Mac created by Mark Gorton in 2000.
 Used for downloading & distribution of pirated material, primarily music.
 Unlike Napster, LimeWire generated revenue by selling ‘premium’ versions of their software to
clients.
 Fun Note: 13 major recording companies sued LimeWire claiming each copyright violation had cost
them 150k. 11k songs were illegally distributed, adds up to 75 trillion!
 Due to copyright infringements and theft of creative property, Napster ceased operations in 2001&
filed for bankruptcy in 2002.

Innovation & Competitors

 Success of a novelty is influenced by the degree to which a
competitor can imitate the innovation.
 Some innovations are easy to copy:
 Smartphone apps.
 Social media platforms.
 Why is this the case?:
 Simplicity
 Accessibility (E.g. Open Source Software)
 Lack of intellectual property protection.
 Standardization (E.g. Fast Food Model)

Innovation & Competitors

Some innovations are difficult to copy:

 Coca-Cola (Trade Secret Formula).

 Amazon’s e-commerce platform (First-mover
advantage).
 Google’s search algorithm (Patent &
Constantly Evolving)
Why is this the case?:

 Intellectual Property Protection

 Trade Secrets
 Brand Recognition
 Network Effects (difficulty getting a critical
mass of users to switch)
 First-mover Advantage

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Patents
 A patent is a form of intellectual property that gives its owner the exclusive legal right to make, use, and sell an
invention for a limited period, typically 20 years.
 Patent may include:
 Machines
 Processes
 Software
 Some types of plants
 Patent eligibility requires:
 Novelty – Must be new to the public domain
 Non-obviousness – Not obvious to someone skilled in the field
 Utility – Have practical use or be capable of being used in some industry or field.

Trademarks
 A trademark is a symbol, word, phrase, or combination of these elements that is used to identify and distinguish
the products or services of one business from those of others.
 Trademark eligibility requires:
 Distinctiveness – Not too like marks already in use.
 Use in commerce – Used in connection with selling a good or service.
 Non-generic – Must not be generic or describe the produce or service itself.

Copyrights
 A copyright is a form of intellectual property that gives the creator of
original work exclusive rights to:
 Reproduce the work.
 Distribute copies of the work.
 Perform the work publicly.
 Display the work publicly.
 Create derivative work based on the original work.
 Copyright eligibility requires:
 Originality – Original & created by the author.
 Fixation – Fixed in a tangible medium of expression.
 Creativity – Exhibit a minimal degree of creativity.
Trade Secrets
 A trade secret is a form of intellectual property that refers to confidential information that
gives a business a competitive advantage
 Unlike patents, trademarks, & copyrights, trade secrets do not require any type of
registration.

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Protecting an Innovation (Advantages)
 Maintaining a competitive advantage.
 Increased revenue.
 Brand recognition.
 Legal Protection.
 Attracting Investors.

Diffusing an Innovation (Advantages)

 Faster adoption.
 Increased market share due to availability.
 Lower costs. (E.g. Spreading R & D)
 Innovation Diffusion Network – More people to share ideas with.
 Social Benefits – Improving lives & solving problems.
Personal Computers Renewable Energy
Internet
Social Media

Cell Phones

Organizing for Innovation(Chapter-10)

Innovation: Big Firm Advantages

 More Money!
 Easier access to capital.
 Invest in new technologies & expand operations. $200B+ Cash Reserve
 Distribution
 Can reach customers more effectively.
 Partnerships with major retailers.
 Economies of Scale
 Allows the production of goods & services more efficiently.
 Allows for the lowering of prices to attract customers and gain market
share.
 R&D
 Large budgets which allow investment in advanced technologies and
research new products and services. $26B+ spent on
R&D in 2020

Innovation: Small Firm Advantages Organizational Complexity

 Inertia
 Changes in big companies don’t typically happen
quickly; i.e., slow to pivot. Small companies typically
don’t have this problem. Bureaucracy (Rigid Structure)
 Niche Markets
 Smaller companies can focus on specific customer
needs which larger companies may find
unprofitable.
 Local Market Understanding
 Smaller firms may have a better understanding of
local markets.
 Personalized service and a loyal customer base.
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 Discussion

 What are some examples of large companies that have

shown a consistent ability to innovate and develop new
products and/or services?
 3M: A multinational conglomerate that has developed innovative products in
healthcare, consumer electronics, and the automobile industry.
 26 business lines grouped into 5 segments (revenue streams).
1. Industrial Business – E.g. Tapes & Adhesives
2. Safety & Graphics – E.g. PPE
3. Consumer Business – Office Supply & Stationary
4. Healthcare – Medical tapes & Stethoscopes
5. Electronics & Energy – LCD Monitors & Tablets

 What are some examples of small companies that have shown a consistent ability to innovate
and develop new products and/or services?

Virtual Backgrounds Zoom Rooms

Zoom For Home

Firm Structural Dimensions

 Formalization
 The degree to which a firm utilizes rules, procedures, and
written documentation to structure the behavior of
individuals.
 Benefits:
 Structured and predictable environment.
 Increase efficiency & communication.
 Drawbacks:
 Rigid & bureaucratic environment.
 Employees feel constrained by formal rules and procedures which may stifle
innovation.
 Standardization
 The degree to which activities are performed in a
uniform manner.
 Benefits:
 Increase efficiency & reduced costs.
 Quality & safety improvement.
 Drawbacks:
 Oftentimes difficult to apply “across the board” standards.
 May also stifle innovation.

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  Centralization
 The degree to which decision-making authority is kept at top levels.
 Benefits:
 Streamlines the decision-making process.
 Ensures consistency.
 Drawbacks:
 Lack of flexibility & responsiveness.
 Bureaucratic and hierarchical environment.
 Span of management.
 Not appropriate for routine decisions.
 Unsuitable for large organizations.

 Decentralization
 The degree to which decision-making authority is pushed down to lower levels.
 Benefits:
 Increased flexibility & responsiveness.
 Unity of command.
 Increased autonomy at lower organizational levels.
 Promote innovation.
 Drawbacks:
 Lack of consistency in decision making.
 Varying adherence to strategy & operations.
 Difficulty maintaining control & accountability over different department.

Organizational Structures:

Ambidextrous Organizations:
 Ambidextrous organizations are those in which different divisions vary in the way they operate.

Loosely Coupled Organizations:

 A loosely coupled structure is one in which development and production activities are not tightly
integrated but achieve coordination through shared objectives and standards.

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Discussion:
 Which is better in helping an organization reach its goals, a formal organizational structure or an
informal organizational structure?
 Do you prefer the method of communication that happens within a formal structure or an informal
structure?
 How can an organization assess whether its chosen organizational structure is effective?

Product Development(Chapter: 11)

What makes a product successful?

 Fit with customer requirements:
 Should fulfill a customer need not being
addressed by existing products in the market.
 Reliable & Durable (Minimal Maintenance)
 Cost Effective: Good value for the $$
 Controlling development costs & minimizing time to market:
 Optimize the product development process
 Leverage technology and tools
 Implement cross-functional teams.

Development Process
 Sequential Development Process:  Parallel Development Process:
 Development activities overlap.
 Development activities do not
 Benefits:
overlap.  Improved collaboration
 Benefits:  Improved risk management
 Structured Approach  Drawbacks:
 Enhances Quality Control  Coordination challenges
 Increased management and
 Defined Milestones
oversite.
 Drawbacks:  Can lead to more significant
 Lacks flexibility changes and product
 Difficulties in identifying integrations.
defects
 Time consuming, e.g., must
complete one step before
moving on to the next.

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Development Process - Project Champions
 Benefits:
 Increased focus & keeping the project on
track.
 Increase communication & collaboration.
 More effective decision making.
 Risks:
 Escalating commitment
 Unwillingness to entertain potential
challenges

Development Process - Customer Involvement

 Benefits:
 Increased understanding of customer
needs.
 Increased customer satisfaction.
 Competitive advantage.
 Drawbacks:
 Time & cost.
 Conflicting feedback.
 Product launch delays.

Development Process - Supplier Involvement

 Benefits:
 Access to supplier expertise.
 Improved design & quality.
 Stronger supplier relationships.
 Improved supply chain efficiency.
 Drawbacks:
 Intellectual property concerns.
 Supplier dependence.

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Development Process - Crowdsourcing
Definition: A problem solving model
whereby a design problem or
production task is presented to a
group of people who voluntarily
contribute their ideas and effort in
exchange for some sort of
compensation

Development Process – Beta Testing

Definition: A type of testing performed by a group of users or customers that involves releasing a beta
version of a software product to a limited number of users for testing and feedback before releasing it to
the general public.

Development Process: Quality

 Quality Function Deployment: A structured process used by companies to translate
customer requirements into specific technical requirements and design features for a
product or service.
 QFD Steps:
1. Identify customer needs.
2. Develop technical requirements.
3. Determine the relationship between customer needs and the technical
requirements and prioritize them based on importance to the customer.
4. Develop a product or service design.
5. Verify that the product or service design meets the customers needs.

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 Development Process: Quality
 FMEA: Failure Modes & Effects Analysis
 Used to trace the effects of individual component failures on the overall, or
“catastrophic,” failure of equipment.
 E.g., Preventative maintenance on components.
 DFM: Design For Manufacturing
 CAD/CAM
 Reduce cycle time
 Improve product quality
 Control developmental costs

Question 1
Focusing on local markets and personalized service is something commonly demonstrated by large
companies. False
Question 2
A firm which keeps the authority to make decisions at the top level of the organization ensures unity of
direction is being promoted. True
Question 3
Formal organizational structures are always preferred over informal structures as they have been shown
to reduce costs and increase efficiency. False
Question 4
Smaller firms generally adapt to change more easily than larger firms. True
Question 5
There is not a limit to the number of subordinates a good supervisor can effectively manage.
False
Question 6
Access to expertise is just one of the the many benefits of including suppliers in the product
development process. True
Question 7
Sequential development processes encourage collaboration across all those involved in the product
development process. False
Question 8
Crowdsourcing can be defined as presenting a problem to a group of people who provide their ideas in
exchange for something. True
Question 9
Disregarding current technology and tools is just one method for controlling product development costs
and reducing time to market. False
Question 10
Including customers in the product development process has the potential to garner firms a competitive
advantage prior to releasing the innovation to market. True

Page 18 of 22
 Development Teams & Deployment Strategies (Chapter 12 and 13)

REVIEW: RADICAL VS INCREMENTAL INNOVATION

 Radical Innovation:
 A breakthrough or significant change that disrupts existing markets or creates
new ones.

REVIEW: RADICAL VS INCREMENTAL INNOVATION

 Incremental Innovation:
 Continuous improvement or existing products, processes or services.

PRODUCT DEVELOPMENT TEAMS

 Benefits:
 Enhanced problem solving through
collaboration.
 Increased efficiency, E.g., dividing up tasks
and leveraging strengths.
 Improved communication.
 Drawbacks:
 Conflict
 Unequal workload
 Limited autonomy
 Groupthink, E.g., conforming to consensus.

TEAM DIVERSITY
 Benefits:
 Different backgrounds, skills,
& expertise.
 Variety of perspectives.
 Drawbacks:
 Communication challenges.
 Resistance to change.
 Lack of inclusion.
 Stereotyping & bias.

**Overall, drawbacks of team diversity tend to result from a lack of

understanding, communication, or inclusion. Page 19 of 22
TEAM STRUCTURES
 Functional Teams:
 Teams are organized by the functions or departments of the organization
 Cross-functional Teams:
 Teams are composed of members from different departments or functions within an
organization.
 Self-managed Teams:
 These teams are self-organized and self-directed, with members collectively responsible
for setting goals, making decisions, and managing their work processes.
 Virtual Teams:
 Teams work together remotely, using technology to communicate and collaborate.

TEAM LEADER – LEADERSHIP STYLE

 Autocratic:
 “My way or the highway.”
 Democratic:
 Involves team members in decision making.
 Bureaucratic:
 Emphasizes compliance with organizational policies, rules, & objectives.
 Laissez-Faire:
 Delegation and “hands-off” approach.
 Servant:
 Prioritizes needs of their team members.
 Contingency:
 No one style is best.

INNOVATION DEPLOYMENT STRATEGIES

 Launch Timing Factors:
 Market Demand
 Competition
 Production Readiness
 Marketing Readiness, E.g. A marketing plan in place before launch.
 Seasonality
 Economic Conditions

INNOVATION DEPLOYMENT STRATEGIES

 Licensing:
 An agreement where the owner of a technology
(the licensor) allows another party (the
licensee) to use, manufacture, or sell the
technology in exchange for a fee or
royalty payment.
 Backward compatible:
 The ability for a system to use and process data
or software from earlier versions without
requiring modifications.

Page 20 of 22
INNOVATION DEPLOYMENT STRATEGIES
 Penetration Pricing:
 A pricing strategy used by companies to gain market share by offering products or
services at a lower price than competitors.

 Freemium Pricing:
 A pricing model used by companies for digital products and services, such as
software applications or online games, where the basic version of the product or
service is offered for free, while premium features or functionality are only
available to users who pay for them.

 Distribution:
 Direct vs Intermediaries
 Manufacturer Representatives:
- Independent reps that promote and sell manufactures’ products.
 Wholesalers:
- Companies that by in bulk from manufacturers & resell.
 Retailers:
- Companies that sell goods to the public.
 OEM’s:
- Companies that buys products/components and assembles or customizes them into
a product.

 Marketing Strategy:
 Advertising
 Promotions
 Publicity & Public Relations
 Shaping Expectations:
 Press Releases
 Reputation
 Credible Commitments, E.g., refund policy.

Page 21 of 22
Page 22 of 22