Deck 3: The Technological Environment

Question 1

What role does technology play in business in general and in terms of shaping business strategy in particular?

Answer 1

$\bullet$ Explain what technology is and how it impacts on business in terms of productivity and potential for product differentiation.
$\bullet$ Explain the role of technology in terms of competitive advantage.
$\bullet$ Discuss the possible strategic responses in terms of being a 'first mover' or an adopter of technology.

Question 2

What role has technological change played in shaping the nature of the grocery markets in developed countries? Assess the costs and benefits of these changes.

Answer 2

$\bullet$ Describe the main changes across the value chain from small-scale farms and local markets to large-scale agribusiness and supermarkets.
$\bullet$ Discuss the reasons for these changes.
$\bullet$ Discuss the relative advantages and disadvantages of these developments.

Question 3

How does Porter use the concept of the 'value chain' to show the importance and impact of technology in developing the competitive advantage of a firm? Explain, with examples, how information technology has played such a large role in the most recent rapid rise in economic growth rates across the world.

Answer 3

$\bullet$ Define and explain the nature of the value chain.
$\bullet$ Give examples of technological change across the value chain.
$\bullet$ Explain with examples IT applications and the rapid growth in IT capacity.
$\bullet$ Reference the recent debate about the 'productivity paradox'.

Question 4

What is the 'IT productivity paradox'? Evaluate the relative arguments between the technology pessimists and optimists.

Question 5

Choose one of the following businesses: Apple, Google, Facebook, or Amazon.
Outline the main features of the technological environment which have shaped the business strategy of your chosen business and discuss any potential threats to their future growth.

Question 6

To what extent is it inevitable that the development of ICT and AI will lead to technological unemployment?

Question 7

The IT productivity paradox is:

A) That it is always better to invest in low-tech solutions rather than high-tech ones
B) Most commonly accepted by technological optimists
C) That as all investment is financially risky, businesses must be cautious not to overestimate the possible future returns
D) That while it is assumed that ICT developments have revolutionized business there is little evidence that this is reflected in productivity statistics

Question 8

What is meant by the term 'a rise in productivity'?

A) An increase in business profits
B) An increase in a firm's output greater proportionally than a corresponding increase in its inputs
C) An increase in the amount that a business produces
D) An increase in a firm's use of resources which leads to an increase in its outputs

Question 9

What did Schumpeter mean by the term 'creative destruction'?

A) That in the competitive process new business ideas would replace older ones, and that this process of innovation would inevitably mean that change would occur with old companies, products, or processes being replaced by new ones
B) That new ideas may sometimes have harmful effects
C) That capitalism as an economic system would destroy itself through competition
D) That because businesses were under pressure to invest in new technology, they would constantly be facing falling profits and would inevitably fail

Question 10

What is meant by the term 'spillover effects' in relation to investment in technological research and the role of the state?

A) The ICT function of business can impact across the value chain
B) It is often the case that if one firm develops a technological advantage that other firms will be able to share in this
C) That we haven't yet seen the true potential of ICT and that the benefits of the digital age will be much greater in the future
D) That we need to be careful about boosting technology if the side effect is unemployment

Question 11

Technology is important because: (Please select all that apply.)

A) It always produces a higher standard of living
B) It has the potential to increase productivity
C) It can enable a country to shift out of the boundaries of its production possibilities
D) It enables the gap between rich and poor to narrow

Question 12

In the value chain as outlined by Michael Porter, which of the following functions are within the horizontal functions of a business? Please select all that apply.

A) Finance
B) Human resources
C) Marketing
D) Inbound/outbound logistics

Question 13

Which of the following people are most sceptical of the idea that the ICT revolution has had the most dramatic effect in terms of boosting productivity compared to previous eras?

A) Robert Gordon
B) Brynjolffson
C) Ha Joon Chang
D) Kurzweil

Question 14

Which of the following are seen as being potential problems of technological advances? Please select all that apply.

A) The development of technology in countries where institutions are 'extractive'
B) The damage to social organization if technology gives more wealth and power to certain groups than to others
C) The costs to the ecological environment
D) The danger of technology allowing the creation of monopoly power

Question 15

The term 'basic research' is used to describe investment in improving the basic skills of a population first to raise literacy and numeracy levels.

Question 16

It is always better for a business to be a 'first mover' in the invention and adoption of a new technology.

Question 17

Technological change contributes to economic growth.

Question 18

Technological change is always initially the result of human ability to have the genius to invent new products.

Question 19

A major feature of the technological debate in the twenty-first century will be the extent to which technological change can occur without leading to increased inequality and unemployment.

Question 20

It is inevitable that the rise of ICT and AI in the future will lead to large levels of unemployment.