CHAPTER 5

Question 1

its offering a new product to an established or new market

Answer 1

new entry

Question 2

the set of decisions, actions and reactions that first generate then exploit over time, a new entry

Answer 2

entrepreneurial strategy

Question 3

stage 1: new entry generation

Answer 3

knowledge
other resources
resource bundle
assessment of new entry opportunity

Question 4

stage 2: new entry exploitation

Answer 4

assessment of new entry opportunity
entry strategy
risk reduction strategy
organization
firm performance

Question 5

they are the basic building blocks to a firm’s functioning and performance; the inputs into the production process

Answer 5

resources

Question 6

resources must be (2)

Answer 6

• valuable
• rare
• inimitable

Question 7

information, technology, know-how, and skills that provide insight into a market and it’s customers

Answer 7

market knowledge

Question 8

information, technology, know-how and skills that provide insights into ways to create new knowledge

Answer 8

technological knowledge

Question 9

depends on the level of information and the willingness to make a decision without perfect information

Answer 9

assessing the attractiveness

Question 10

prior knowledge and information search, more knowledge ensures a more efficient search process

Answer 10

information on a new entry

Question 11

the viability of a new entry can be described

Answer 11

in terms of a window of opportunity

Question 12

negative outcome from acting on the perceived opportunity

Answer 12

error of COMMISSION

Question 13

negative outcome from not acting on the new entry opportunity

Answer 13

error of omission

Question 14

difficulty in estimating the potential size of the market, how fast it will grow and the key dimensions along which it will grow

Answer 14

demand uncertainty

Question 15

difficulty in assessing whether the technology will perform and whether alternate technologies will emerge and leapfrog over current technologies

Answer 15

technological uncertainty

Question 16

difficulty in adapting to new environmental conditions

Answer 16

adaptation

Question 17

environmental instability and first mover disadvantages (2)

Answer 17

• demand uncertainty
• technological uncertainty
• adaptation

Question 18

difficulty in accurately assessing whether the new product or service provides value for them

Answer 18

uncertainty for customers’

Question 19

overcome customer uncertainty by:

Answer 19

• informational advertising
• highlighting product benefits
• creating a frame of reference
• educating customers through demonstration

Question 20

the grace period in which the first mover operates in the industry under conditions of limited competition

Answer 20

lead time

Question 21

lead time can be extended if

Answer 21

• building customer loyalties
• building switching costs
• protecting product uniqueness
• securing access to important sources of supply and distribution

Question 22

derived from uncertainties over market demand, technological development and actions of competitors

Answer 22

risk

Question 23

two strategies to reduce risks

Answer 23

• market scope strategy
• imitation strategy

Question 24

focus on which customer groups to serve and how to serve them

Answer 24

market scope strategies

Question 25

involves offering a small product range to a small number of customer groups to satisfy a particular need

Answer 25

narrow scope strategy

Question 26

involves copying the practices of others

Answer 26

imitation strategies

Question 27

types of imitation strategies

Answer 27

- franchising - "me-too" strategy

Question 28

a ______ acquires the use of a proven formula for new entry from a ______

Answer 28

franchising

Question 29

copying products that already exist and attempting to build an advantage through minor variations

Answer 29

"me-too strategy"

Question 30

an imitation strategy can potentially:

Answer 30

- reduce entrepreneur's costs - reduce customer uncertainty - make the new entry look legitimate