changing environment and inertia

Question 1

sustaining technologies

Answer 1

technologies that do not require a new business model to be utilized commercially

Question 2

disruptive technologies

Answer 2

technologies that do require a new business model to be utilized

Question 3

inertia

Answer 3

tendency to do nothing or remain unchanged

Question 4

dimensions of successfully adapt a business to changing competitive landscape

Answer 4

Phycological
Technological
Relational

Question 5

Phycological dimension

Answer 5

managers needs to be psychologically convinced that change is needed and ready to implement necessary change actions

Question 6

Technological dimension

Answer 6

companies should be able to develop necessary technological capabilities

Question 7

relational dimension

Answer 7

Companies need to have relational capabilities to develop and manage their collaborations with external partners

Question 8

Population ecology theory

Answer 8

in order to survive and grow organizations need to develop processes that allow them to replicate their outputs consistently and efficiently. This cycle makes organizational processes more efficient but also rigid. When the environment changes radically, existing processes are no longer effective

Question 9

sources of inertia

Answer 9

strategic frame rigidity
routine rigidity
resource rigidity

Question 10

Strategic frames of managers

Answer 10

the mindsets that shape how managers see the business world and how they believe customer value should be created

Question 11

Strategic frame rigidity

Answer 11

managers of established companies are too fixated on how they learned to do business and on old ways of doing business that brought success in the past

Question 12

organizational routines

Answer 12

established procedures to carry out organizational tasks

Question 13

routine rigidity

Answer 13

when processes become routines they enable efficient operations but hard to change or rigid as they prevent employees from considering new ways of working

Question 14

Resource rigidity

Answer 14

firms tend to invest in resources that have been useful to develop a competitive advantage in the past and thus hesitate to invest in new resources

Question 15

reasons for resource rigidity

Answer 15

failure to realize the importance of new resources
fear of losing current customers
constraints places by investors and capital markets

Question 16

Companies approach to inertia through renewal

Answer 16

companies should ask what hinders us instead of what should we do and have a clear understanding of how their old formula for success would hinder them in responding to the changes

Question 17

Research investments and overcoming inertia

Answer 17

in-house research and contract research are unlikely to lead to commercialization when the technology is disruptive due to subject to incentive structure, cognition of managers, and resource allocation processes. Alliances and acquisitions are more likely to lead to commercialization due to structurally separated research investments, involvement of outsiders in decision-making processes, incentive alignment and isolation from the demands and constraints of the current business model

Question 18

reducing inertia

Answer 18

a new business unit with decision making authority
open innovation
strategic alliances with other organizations
acquiring smaller and innovative companies
incorporate input from outside to operations focusing on the new technology