Question 1

Jackson Laboratories has come up with a new diabetic blood sugar monitoring device that does not require patients to prick their fingers.It has determined that this new technology is likely to quickly become the dominant method used by diabetics and will replace the old blood sugar monitoring devices Jackson currently sells.Hence,Jackson should enter the market quickly.

Accepted Answer

The statement suggests that the new blood sugar monitoring device is likely to become the dominant method used by diabetics and replace the old devices. Therefore, Jackson Laboratories should enter the market quickly to take advantage of this opportunity.

Question 2

In industries that have increasing returns to adoption,allowing competitors to get a head start in building installed base can be a safe strategy.

Accepted Answer

Industries with increasing returns to adoption have a network effect, which means the value of a product or service increases as more people use it. In such industries, it is important to quickly establish a large installed base to gain a competitive advantage. Allowing competitors to get a head start can make it more difficult for a new entrant to catch up, ultimately leading to a loss of market share. Therefore, it is not a safe strategy to let competitors build an installed base first in industries with increasing returns to adoption.

Question 3

The credibility of a firm and the rate of adoption are directly related.

Accepted Answer

The credibility of a firm, which includes factors such as reputation, reliability, and quality of products or services, can influence the rate of adoption, i.e., the speed and extent to which customers or users adopt the firm's offerings. The more credible a firm is perceived, the more likely customers are to trust and try its products or services, leading to faster and wider adoption. On the other hand, a lack of credibility or negative reputation can hinder adoption and even lead to resistance or rejection of the firm's offerings. Therefore, credibility is an important factor in determining the success and growth of a firm.

Question 4

Once buyers have adopted a good,they can easily switch to another good.

Accepted Answer

Once buyers have adopted a good, they may face switching costs that make it difficult or costly to switch to another good. These costs can be financial, time-related, or even emotional, such as loyalty to a particular brand or product. Therefore, it may not be easy for buyers to switch to another good.

Question 5

All pioneers face customer uncertainty.

Accepted Answer

The answer of All pioneers face customer uncertainty....

Question 6

If you are a first mover in the market of a new technology,you may find that your product offerings will have to be modified as consumers let their preferences be known.

Accepted Answer

As the first mover, you do not have any prior data or feedback from consumers to base your product offerings on. Therefore, as consumers start adopting the technology and providing feedback, you may need to modify your product offerings to meet their preferences and needs.

Question 7

If a firm intends to refine an earlier entrant's technology and beat the earlier entrant to market with a new version of this technology,it must have enabling technologies.

Accepted Answer

The answer of If a firm intends to refine an...

Question 8

A firm with fast-cycle development processes has more timing of entry options.

Accepted Answer

A firm with fast-cycle development processes is able to develop new products quickly, which provides them with more timing of entry options for introducing these products into the market. This is in contrast to a firm with slow-cycle development processes, which may have fewer opportunities for timing entry due to longer development timelines.

Question 9

Irrespective of whether the characteristics of a technology are imitable or not,a first mover has an opportunity to build brand loyalty before the entry of other competitors.

Accepted Answer

Even though imitability may determine the length of time a first mover holds the advantage, being the first one in the market allows them to establish their brand and gain loyalty from early adopters, giving them an advantage over future competitors.

Question 10

A technology that makes a dramatic improvement over previous generations or different technologies will take time to be accepted by customers on account of its radical differences.

Accepted Answer

The answer of A technology that makes a dramatic improvement...

Question 11

If you are certain of customer preferences and needs,you can enter the market earlier than if customer needs were unknown.

Accepted Answer

If you have a clear understanding of customer preferences and needs, you can develop and launch your products or services earlier, gaining a competitive advantage in the market. However, if you are unsure about customer needs, you may have to conduct extensive market research and testing, delaying your entry into the market.

Question 12

When enabling technologies are mature,you should wait to enter the market later.

Accepted Answer

When enabling technologies are mature, it is advantageous to enter the market earlier rather than waiting, as there will already be established competitors and high barriers to entry.

Question 13

Although other companies in the gliding shoe market have come out with hydrogen based power units,the first company in this market,GlideShoe is sticking with the fossil fuel power units.This is likely an example of incumbent inertia.

Accepted Answer

Incumbent inertia refers to the tendency of established companies to stick with their current technologies or methods, even when newer or more efficient options become available. In this case, GlideShoe is sticking with fossil fuel power units instead of switching to hydrogen-based power units like other companies in the market.

Question 14

Late entrants usually enter the market only once the product has been adopted by the
mass market.

Accepted Answer

Late entrants typically enter the market after the product has gained acceptance among the mass market. This is because they want to avoid the risks associated with introducing a new product to the market, such as the high costs of research and development, marketing and advertising, and potential low demand or market rejection. By waiting until the product has already gained popularity, late entrants can benefit from the established brand reputation, customer base, and distribution network, and focus on differentiating their products or offering lower prices to gain market share.

Question 15

Even though the technology for high definition DVD players is clearly superior to the old generation,it requires that users buy high definition television sets.This factor might reduce the adoption of new DVD players.

Accepted Answer

High definition DVD players require high definition television sets, which can be costly for consumers who may be hesitant to make the investment. This could lead to a slower adoption of the new DVD players.

Question 16

Early followers typically bear the bulk of the research and development expenses.

Accepted Answer

The answer of Early followers typically bear the bulk of...

Question 17

For a very new product technology,market research may be of significant help.

Accepted Answer

The answer of For a very new product technology,market research...

Question 18

A firm that has very fast-cycle development processes may be able to capitalize on both first and second-mover advantages.

Accepted Answer

A fast-cycle development process allows a firm to quickly bring new products to market, which can lead to both first-mover advantages (being the first to bring a new product to market) and second-mover advantages (learning from the mistakes of the first mover and improving upon their product). Therefore, a firm with fast-cycle development processes may be able to capitalize on both.

Question 19

Early leaders are firms that are the first to enter the market.

Accepted Answer

The answer of Early leaders are firms that are the...

Question 20

A later entrant can produce a product that achieves a closer fit with market preferences.

Accepted Answer

A later entrant in the market can use the information gathered from the existing products to create a product that is more in line with customer preferences and needs, thus achieving a closer fit with market preferences. This is possible because the later entrant has the benefit of observing the successes and failures of existing products, and can use this information to make improvements and differentiate themselves from existing products.

Quiz 5: Timing of Entry Part Two Formulating Technological Innovation Strategy