Deck 8: The Concept Evaluation System

Question 1

The evaluation process begins with the creation of a prototype.

Answer 1

False

Question 2

Development is naturally iterative.

Answer 2

True

Question 3

New products mostly fail because of all of the following reasons EXCEPT:

A)there was no need for the product.
B)the intended consumer did not think the new offering was effective.
C)the product was not understood properly by the consumer.
D)the product and its marketing plan were evaluated as separate and divisible pieces.

Answer 3

D

Question 4

The A-T-A-R concept is based on the diffusion of risk model.

Question 5

The decay curve indicates the cumulative expenditure incurred at various stages of developing a new product.

Question 6

Availability means the percentage chance that if a buyer wants to try the product,the effort to find it will be successful.

Question 7

A firm's new product evaluation system:

A)can be used when an opportunity is identified and assessed.
B)avoids backtracking.
C)should not be implemented until after a prototype has been created.
D)can only be applied to the final product just before the launch.

Question 8

A new product appears first as a(n)____.

A)prototype
B)idea
C)model
D)code

Question 9

Generally,out of every 100 new product concepts,only 10 ever make it to the market.

Question 10

Early in the life of a new product,an idea is fragile and easy to kill;later in the development cycle the idea becomes a strong proposal and is tough to stop.

Question 11

The late expenditures curve is representative of product development in technical fields such as optics.

Question 12

All of the following statements about a firm's evaluation system are true EXCEPT:

A)it may treat the product and its marketing plan together or independently at various points in time.
B)it has individual evaluation step tasks,each having specific purposes.
C)it proceeds in a straight-line,step-by-step fashion.
D)it sometimes involves backtracking.

Question 13

If a firm makes products with very long cycle times,it has to control the number of products it has in the process queue at any given time so that products receive development funds in a timely manner.

Question 14

The timing of factual information does not often match our need for it.

Question 15

Increasingly,marketers realize that a marketing plan cannot be developed,much less evaluated,until the product evaluation process has been completed.

Question 16

In new product work,financial analysis should be done by firms as early as possible to avoid wasting money on poor projects.

Question 17

A-T-A-R model is applicable to services as well as industrial products.

Question 18

Which of the following reasons lets us telescope the development process into shorter periods of time?

A)The development process proceeds in a straight-line,step-by-step fashion.
B)The development process begins after the initial prototypes are generated.
C)We evaluate the product and its marketing plan as separate and divisible pieces.
D)A cross-functional team works on the development process.

Question 19

A go error is worse than a drop error.

Question 20

With reference to the risk / payoff matrix,a "drop error" occurs when a product that would fail is continued.

Question 21

The first use of evaluation is focused upon:

A)the development of a marketing plan.
B)the likely success of the product concept that has been selected for development.
C)mistakes made during the launch of the new product.
D)providing direction for the selection of potential product concepts.

Question 22

Which of the following statements is true regarding a new product development project which is evaluated with the help of rolling evaluation?

A)The project is assessed at predefined intervals.
B)This evaluation generally leads to the premature closure of a project.
C)Everything in the project is keyed to a single Go / No Go decision.
D)Participants avoid mindsets of good and bad about the project.

Question 23

The farther a new product idea is allowed to proceed through the development process:

A)the easier it is to kill it.
B)the less stringent the evaluation it must pass.
C)the easier it is to wave aside the hurdles.
D)the smaller the number of people supporting it.

Question 24

Which of the following industries is most likely represented by a late expenditure curve?

A)Consumer packaged goods
B)Pharmaceuticals
C)Optics
D)Computers

Question 25

Which of the following statements is true regarding the cumulative expenditure curve?

A)The early expenditure curve initially slopes downward and then starts sloping upward.
B)The late expenditure curve is representative of product development in technical fields such as optics.
C)The late expenditure curve initially slopes upward and then starts sloping downward.
D)The early expenditure curve is usually observed in the field of pharmaceuticals.

Question 26

Development is naturally ____.

A)sequential
B)iterative
C)retrospective
D)convoluted

Question 27

Which of the following risk strategies is most likely to incur opportunity costs?

A)Avoidance
B)Mitigation
C)Transfer
D)Acceptance

Question 28

According to the risk / payoff matrix,during the phase of concept / project evaluation,managerial problems arise when there is a _____ error.

A)drop
B)decay
C)launch
D)development

Question 29

All of the following statements about the evaluation system / process are true EXCEPT:

A)everything is tentative here.
B)form can usually be changed during the process.
C)everything should be keyed to a Go / No Go decision.
D)requires product developers to anticipate major potholes of product innovation.

Question 30

Concept testing is sometimes called concept _____ to reinforce the idea of helping the item,not just killing it off.

A)checking
B)development
C)validating
D)evaluating

Question 31

For every 100 product concepts which are there before concept testing,usually only _____ ever get to the market.

A)10
B)20
C)2
D)30

Question 32

In this risk strategy,risk is reduced to an acceptable,threshold level,perhaps through redesigning the product to include more backup systems or increasing product reliability.

A)Mitigation
B)Avoidance
C)Passive acceptance
D)Transfer

Question 33

Which of the following outcomes of a risk / payoff matrix,used for evaluating a new product process,is most likely to be the costliest for a firm?

A)Stopping a product that would fail
B)Continuing a product that would fail
C)Stopping a product that would succeed
D)Continuing a product that would succeed

Question 34

Which of the following risk strategies is said to be employed by a firm that develops a contingency plan to accompany new product development?

A)Avoidance
B)Active acceptance
C)Mitigation
D)Passive acceptance

Question 35

A rolling evaluation means that the project is being assessed continuously,which implies that it is dealing with risk via ____.

A)avoidance / transfer
B)acceptance / avoidance
C)acceptance / mitigation
D)mitigation / avoidance

Question 36

The primary purpose of evaluation during Phase III of the evaluation process is:

A)the development of a marketing plan.
B)the creation of a final,full-scale prototype.
C)identification of concepts which will proceed further in the development process.
D)to eliminate all mistakes made during the launch phase.

Question 37

The evaluation issue during the launch phase in the new product process is whether the firm has proven itself able to make and market the item on a commercial scale.This issue is usually resolved by some form of ____.

A)market testing
B)prototype development
C)development protocol
D)iteration analysis

Question 38

The use of subcontractors or joint ventures is most likely to be closely associated with this risk strategy.

A)Mitigation
B)Avoidance
C)Acceptance
D)Transfer

Question 39

The first use of evaluation usually:

A)occurs after a product concept has been developed.
B)precedes the product concept.
C)follows the development of a prototype.
D)immediately follows the product launch.

Question 40

During the concept generation stage,the goal of evaluation is to:

A)encourage the development of all concepts generated.
B)eliminate the big / sure loser(s).
C)assess the usability of the product.
D)ensure that the developmental budget obtained is as large as possible.

Question 41

What are the important reasons for new product failure?

Question 42

In the case of A-T-A-R model,R stands for ____.

A)rate
B)response
C)repeat
D)region

Question 43

Which of the following statements is true regarding surrogate questions?

A)Surrogates often remain constant at different times in the evaluation process.
B)An example of a surrogate question is,"Will the product sell?"
C)They are based on the fact that the timing of factual information often matches our need for it.
D)Their response has little value except to help answer a critical question that cannot be answered directly.

Question 44

When a person or firm who did try something,shares results with a person or firm who cannot try it,it is known as a(n)_____ trial.

A)recommended trial
B)vicarious trial
C)adoption trial
D)virtual trial

Question 45

Which of the following is a surrogate question that can help know customer reactions early on,even before the product has been developed?

A)Will the customers prefer the product?
B)Will cost of the product be competitive?
C)Does the concept match our manufacturing skills?
D)Will competition leap in?

Question 46

Briefly describe how the purpose of evaluation varies through each stage of the new product development process.

Question 47

The A-T-A-R concept is taken from ____.

A)the risk / payoff matrix
B)diffusion of innovation
C)the delay curve
D)the cumulative expense curve

Question 48

Availability means the percentage chance that:

A)a potential buyer will purchase the product.
B)if a buyer wants to try the product,the effort to find it will be successful.
C)a buyer will recommend the product to somebody else.
D)a buyer will buy the product at least one more time.

Question 49

Which of the following can provide the data needed for the A-T-A-R model?

A)The cumulative expenditure curve
B)Income statement of the firm
C)Market test
D)The decay curve

Question 50

Lexus Inc. ,is interested in determining whether a potential new product will be preferred by customers,even before it is launched.Since customer reactions cannot be gauged at this stage,the firm can make use of _____ to gather pieces of information that can substitute for what it wants to learn.

A)surrogate questions
B)perceptual mapping
C)fundamental analysis
D)lexical analysis

Question 51

Discuss the risk / payoff matrix.Explain go error and drop error.

Question 52

Describe the cumulative expenditures curve.

Question 53

Discuss the people dimension of the new product process.

Question 54

Which of the following statements is true regarding the people dimension of the evaluation system?

A)It is difficult to kill an idea in the early stage as most of the people are yet to evaluate the ideA.
B)New product development generally does not affect the promotions and bonus given to the people involved.
C)Early in the life of a new product,the idea may have little support outside of R&D.
D)Late in the development cycle,fewer people support the idea.

Question 55

The A-T-A-R model is most akin to a ____.

A)morphological matrix
B)pro forma income statement
C)risk / payoff matrix
D)decay curve