Module 2: L2

Question 1

Are inventions and innovations synonymous? Why or why not?

Answer 1

No. A cool idea must be both new and a “growing concern”

Question 2

What is the ultimate goal of an innovation?

Answer 2

Produce a temporary monopoly advantage

Question 3

Innovation: Is the monopoly you seek permanent or temporary? Why?

Answer 3

Temporary
1. Followers may catch up
2. Followers may surpass the innovator

Question 4

What are the four factors in a monopoly advantage?

Answer 4

1. Delay of entry for first competitor
2. Speed of decline of costs with experience
3. Speed of learning by first follower
4. Relative costs of the follower

Question 5

What is the market advantages of the innovator (4x listed)?

Answer 5

1. Better relationship with customers
2. Many types of contacts in the market
3. High cost of switching
4. Trust not awarded to newcomers

Question 6

What is the “going concern”?

Answer 6

A social system capable of producing and marketing the innovation

Question 7

Innovation is a process. What were the 6x components of that process listed in the lecture?

Answer 7

1. Core theory
2. Theory of the investment
3. Technical costs
4. Market of benefits theory
5. Division of profits theory
6. Personnel theory

Question 8

What are the 6x listed ways the process of innovation can fail?

Answer 8

1. Technological utopianism
2. Lack of investment approval
3. Insufficient cost reduction and manufacturing improvements
4. Insufficient demand
5. Division of benefits creates internal rifts
6. Lack of organizational flexibility