CHAPTER 5 Flashcards
Offering a new product to an established or new market.
new entry
Offering an established product to a new market.
new entry
Creating a new organization.
new entry
The set of decisions, actions, and reactions that first
generate, and then exploit over time, a new entry.
entrepreneurial strategy
basic building blocks to a firm’s functioning and
performance; the inputs into the production process.
resources
TRUE OR FALSE
Resources can be combined in different ways.
TRUE
true or false
A bundle of resources provides a firm its capacity to achieve superior
performance.
true
resources must be (3)
valuable, rare, inimitable
Information, technology, know-how, and skills that
provide insight into a market and its customers.
market knowledge
Information, technology, know-how, and
skills that provide insight into ways to create new knowledge.
technological knowledge
Search costs include
time and money
The viability of a new entry can be described in terms of
a window of
opportunity
Negative outcome from acting on the
perceived opportunity.
error of commission
Negative outcome from not acting on the new entry opportunity
error of omission
first mover advantages that can enhance performance
cost advantage, less competitive rivalry, opportunity to secure important supplier and distributor channels, a better position to satisfy customers, the opportunity to gain expertise through participation
Difficulty in estimating the potential size of the market, how fast it will grow, and the key dimensions along which it will grow.
demand uncertainty
Difficulty in assessing whether the technology will perform and whether alternate technologies will emerge and leapfrog over current technologies.
technological uncertainty
Difficulty in adapting to new environmental conditions.
adaptation
Entrepreneurial attributes of persistence and determination can inhibit the ability of the entrepreneur to (3)
detect, and implement, change.
Difficulty in accurately assessing whether the new product or service provides value for them.
uncertainty for customers
are highly likely in emerging industries.
environmental changes
ways to overcome customer uncertainty
Informational advertising
highlighting product benefits over substitutions
Creating a frame of reference for potential customer.
Educating customers through demonstration and
documentation.
The grace period in which the first mover operates in the industry under conditions of limited competition.
leading time
Lead time can be extended if the first mover can erect barriers to entry by:
building customer loyalties
building switching costs
protecting product uniqueness
securing access to important sources of supply and distribution
