Tims3309 - Set2

Front 1

Explain the reasons why other keyboards claimed to be more efficient were not able to replace the QWERTY keyboard. Which principle is illustrated in this scenario?

Back 1

QWERTY is an example of a successful first mover. Even though more efficient keyboards have been designed, people are familiar with QWERTY and can't afford to learn the new keyboards. Furthermore QWERTY comes standard with computers.

Front 2

Explain why sometimes the follower and not the first mover of a new technology is more successful in the marketplace?

Back 2

1. The follower may have a better reputation

2. The follower may have access to better resources

3. The follower could improve on the first mover's product

4. The first mover may have produced an incomplete product

5. The market isn't ready when the first mover releases their product

Front 3

What assumptions underlie the use of timing of entry strategies into the market for new products?

Back 3

1. Innovation developed early/quickly

2. Fast-cycle development processes allow company to quickly refine its innovation in response to customer feedback

3. Collaboration on development activities, choice of collaboration mode, choosing/monitoring partners

4. Stuff from previous card

Front 4

Can you think of an example of a successful a) first mover, b) early follower, and c) late entrant? Can you think of unsuccessful examples of each?

Back 4

1. QWERTY :) - Netscape :(

2. Facebook :) - Kodak Instant Camera :(

3. Google :) - Dvorak keyboard

Front 5

What factors might make some industries harder to pioneer than others? Are there industries in which there is no penalty for late entry?

Back 5

1. Limited suppliers

2. Complimentary goods

3. Distribution channels and installed base

Industries where products can be imitated and produce value. e.g. Pharmaceuticals

Front 6

What are the factors influencing optimal timing of entry?

Back 6

1. Certainty of customer preferences

2. Improvement of the innovation over previous solutions

3. Enabling technologies/maturity of technologies

4. Complementary goods should influence value of innovation and be sufficiently available

Front 7

What are the factors influencing optimal timing of entry (cont)?

Back 7

5. Threat of competitive entry

6. Increasing returns to adoption

7. Firms ability to withstand early losses

8. Resources to accelerate market acceptance

9. Reputation of the firm effects uncertainty of customers, suppliers and distributors

Front 8

Porter's Five-Force Model

Back 8

1. Degree of existing rivalry

2. Threat of potential entrants

3. Bargaining power of suppliers

4. Bargaining power of buyers

5. Threat of substitutes

Front 9

Sustainable competitive advantage

Back 9

A function of the VRIO criteria:

1. Rate of competence obsolescence

2. Availability of substitutes for the core competence

3. Imitability of the core competence

Front 10

What are core competencies?

Back 10

A set of integrated and harmonised abilities that distinguish the firm in the marketplace.

Should:

1. Be a significant source of competitive differentiation

2. Cover a range of businesses

3. Be hard to imitate

Front 11

Ambidextrous organisations

Back 11

Manage current core competencies effectively while simultaneously developing new competencies. Manage organisational separation through a tightly integrated senior team. Allows for exploiting the present and exploring the future in order to both succeed and grow.

Front 12

Exploitative vs Exploratory

Back 12

Exploitative - Current core competencies and technologies produce income and technology for the company

Exploratory - Expanding core competencies to discover new opportunities for innovation

Front 13

Higher cost of capital for start-ups and possible external financing

Back 13

Need to pay for equipment, business approval, research grants, employees. They do not have a currently existing source of income.

Family, friends, credit carts, government grants, loans, venture capitalists

Front 14

What is the internal rate of return of a project? How is it calculated? Drawbacks?

Back 14

Rate of return that equates future cash inflows with the initial investment. Normally applied in capital budgeting.

Given a collection of time, cash flow pairs involved in a project, IRR follows from NPV as a function of the rate of return.

Risk is not constant in a business

Future is unknown

Accuracy depends on original cash flow estimates

Front 15

Real options method using stock options

Back 15

Application of financial options theory to quantify the value of intellectual property. Returns to the R&D investment are analogous to the value of a stock purchased with a call option.

Value of stock option is independent of call holder's behaviour, but value of R&D investment is shaped by the firm's capabilities, complementary assets and strategies.

Front 16

For what kind of development projects might a real options approach be appropriate? Inappropriate?

Back 16

1. Where there is high level of uncertainty such that the holder has the right to exercise the option if future events reduce the risk of uncertainty

2. Projects with low levels of uncertainty or that require full investment from small number of sources

Front 17

Different types of assessing methods

Back 17

1. Real Options Analysis

2. Discounted cash flows (Quantitative)

3. Screening questions

4. Combined methods (such as envelopment analysis)

Front 18

Will different methods of evaluating a project typically yield the same conclusions about whether to fund its development?

Back 18

Not likely. Each method is based on different criteria and involves different process of analysis. Similarly grouped methods may yield similar results however.

Front 19

Collaboration Strategies and Technology development modes

Back 19

1. Joint ventures - significant equity investment, new legal entity

2. Licensing - Contractual agreement, rights to ip for royalties

3. Outsourcing - procure services/products externally

4. Collective research organisations - facilitate collaboration between a group

Front 20

Advantages and disadvantages of collaborating for research and product development

Back 20

1. Easier to discover new technologies

2. Access to cutting edge research and technology

3. Can split the costs

etc.

Front 21

Disadvantages of Licensing

Back 21

1. Creates competition

2. Can cause confidentiality problems

3. Inherent risk allowing a company to use your companies business practices

Front 22

Characteristics of collective research organisations

Back 22

1. Need access to technology not available to them alone

2. Well funded and willing to share cost

3. Need access to skills not available to them

4. Common goals/objectives

Front 23

How can firms evaluate potential partners?

Back 23

1. Available in house capabilities (resources)

2. Compatible objectives and styles

3. Impact bargaining power of customers and suppliers, degree of rivalry, threat of entry or substitutes

4. Enhance strengths, overcome weakness, create competitive advantage?

5. Achieve its strategic intent

Front 24

Patent in numerous countries with low funding

Back 24

A patent is a right granted by the government that excludes others from producing, using or selling an invention. Registered trademarks can be used to establish international rights of a product.

Front 25

What is a trademark? How can the rights to a trademark or service mark be established?

Back 25

A word, phrase, symbol, design or other indicator that is used to distinguish the source of goods from one party from goods of another. The rights are established in legitimate use of the mark and do not require registration (although registration is required before suit can be brought over the use of the mark)

Front 26

What is a copyright?

Back 26

A form of protection granted to works of authorship. Prohibits others:

1. Reproducing work

2. Deriving new work based off that work

3. Distributing copies

4. Performing the work publicly

5. Displaying the work publicly

Front 27

Dominant design and profit

Back 27

Sometimes it may be wiser to not protect a technology. This could encourage others to support the technology and increase its likelihood of becoming dominant, and hence produce revenue.

Front 28

Appropriability Regime and requirements for patentability

Back 28

Appropriability is the degree to which a firm is able to capture the rents from its innovation (how easily/quickly competitors can copy an innovation). Tight regimes = easy to capture value, loose regimes = difficult.

1. Novelty (new)

2. Useful

3. Not be obvious for someone with experience/knowledge in the field

4. Not be publicly disclosed before the date the application is filed