Question 1

Cross-functional work teams are best supported by vertical organizational structures.

Accepted Answer

Cross-functional work teams require a flatter, more horizontal organizational structure that allows for collaboration and communication across functional departments. Vertical structures can create silos and hinder cross-functional teamwork.

Question 2

All of the following are paths to scout external opportunities to arrive at open innovation solutions EXCEPT (Chapter 13 Opening Case)

Accepted Answer

Using product champions to develop radical innovations internally is not a path to scout external opportunities. The rest of the options involve engaging with external stakeholders such as customers and competitors to arrive at open innovation solutions.

Question 3

Acquisitions are a low risk approach to producing and managing innovation.

Accepted Answer

Acquisitions can be a high risk approach to producing and managing innovation, as they often involve significant financial investments and integrating two separate organizational cultures.

Question 4

A key risk of acquisitions is that a firm may substitute an ability to buy innovations for an ability to produce innovations internally.

Accepted Answer

When a company acquires another company, it may become too reliant on external sources for innovation rather than investing in internal research and development. This can lead to a lack of innovative capabilities within the firm in the long term.

Question 5

Larger and well-established firms often have more resources and capabilities to produce more radical innovations than do smaller entrepreneurial firms.

Accepted Answer

The answer of Larger and well-established firms often have more...

Question 6

As noted in the Chapter 13 Strategic Focus, social networking sites such as Facebook are primarily used for employees to communicate, but are of limited value in identifying new and different markets for existing and new product ideas.

Accepted Answer

This statement is false. Social networking sites can be valuable resources for identifying new markets and gathering consumer insights, especially through targeted advertising and social listening tools.

Question 7

While smaller firms must use cooperative strategies as a means of producing innovations, larger firms with large R&D units such as P&G and 3M can produce most if not all innovations internally.

Accepted Answer

While larger firms may have resources to produce innovations internally, there is still value in using cooperative strategies such as partnerships and collaborations to enhance innovation and access external knowledge and resources. Additionally, even large firms may choose to use cooperative strategies in certain areas where they lack expertise or need to access new markets.

Question 8

The fastest-growing group of entrepreneurs in the U.S. is women.

Accepted Answer

According to a report by American Express, the number of women-owned businesses has increased by 58% since 2007, making them the fastest-growing group of entrepreneurs in the U.S.

Question 9

The network of strategic alliances built by an organization is a form of intellectual capital from which the organization can draw to develop innovations.

Accepted Answer

Strategic alliances provide access to knowledge, expertise, resources, and technology that can be leveraged for innovation. Therefore, the network of strategic alliances is a form of intellectual capital that an organization can use to develop new products, services, and processes.

Question 10

Isidore Security Services is a national provider of guard and security services for businesses. It has been in business for over 90 years, having been founded by one of Teddy Roosevelt's Rough Riders (Isidore O'Malley). Lately it has been losing clients to more aggressive and innovative firms offering remote security monitoring systems instead of a guard-based approach. The board of directors of Isidore Security Services is concerned that this downward trend may threaten the existence of this venerable firm and the jobs of its employees.

Accepted Answer

This scenario highlights the fact that Isidore Security Services has not been able to adapt to changing market trends and technology, which is an important aspect of strategic entrepreneurship. They failed to recognize the potential of remote security monitoring and did not innovate to meet changing customer needs, resulting in a loss of clients to more innovative competitors.

Question 11

Acquisitions are a means of extending the company's product line and increasing revenues. The capital market values growth. Therefore, some firms make acquisitions to improve their standing in the capital markets.

Accepted Answer

Acquisitions can lead to increased revenues and growth, which are highly valued by the capital markets. Therefore, some firms make acquisitions to improve their standing with investors and increase the value of their stock.

Question 12

An entrepreneurial mind-set, cross-functional product development teams, and shared values/leadership are the three ways that firms implement internal innovations.

Accepted Answer

The statement is true. An entrepreneurial mind-set encourages creativity and risk-taking, cross-functional teams bring diverse perspectives and expertise to product development, and shared values and leadership help to align employees towards a common goal and vision for innovation within the company.

Question 13

Firms develop innovations in all the following ways EXCEPT

Accepted Answer

Divestiture of low-performing units is a strategy to improve financial performance, not a method for developing innovations.

Question 14

Political activity that is centered on the allocation of resources to the different functions may limit the effective use of cross-functional teams.

Accepted Answer

When different departments or functions compete for resources, it can lead to a lack of cooperation and collaboration, which are essential for cross-functional teams to work effectively. This can result in a suboptimal allocation of resources and limit the effectiveness of cross-functional teams.

Question 15

Pet Care Companion Connection (PCCC) is an organization that trains persons with mild to moderate mental disabilities to care for pets in a pet boarding facility. This organization has been successful in providing a quality service for pet owners and a supportive training environment for their trainees. The tuition charged to trainees is only somewhat higher than the fee which day-care providers would charge for these individuals. Graduates of the program are qualified for employment by commercial kennels. PCCC is an example of

Accepted Answer

The answer of Pet Care Companion Connection (PCCC) is an...

Question 16

The use or application of entrepreneurship within an established firm is called

Accepted Answer

The use or application of entrepreneurship within an established firm is called corporate entrepreneurship. This involves creating new products or processes, entering new markets, or developing new business models within an existing organization.

Question 17

According to the Chapter 13 Strategic Focus, businesses can use social networking sites such as Facebook to facilitate innovation.

Accepted Answer

Social networking sites such as Facebook can allow businesses to connect with customers and gather feedback, which can be used for innovation and improving products/services.

Question 18

Innovations can only be produced by actions and activities within the firm.

Accepted Answer

Innovations can also come from external sources such as customers, suppliers, and competitors. Open innovation models, where firms collaborate with external parties to generate and implement new ideas, have become increasingly popular in recent years.

Question 19

Tide Total Care, a premium version of Tide detergent, was developed through Sweden's Lund University along with two small chemical companies as partners. Which of the following methods of generating innovations does Tide Total Care illustrate (Chapter 13 Opening Case)?

Accepted Answer

Tide Total Care was developed through open innovation, as it involved collaboration with external partners (Lund University and two small chemical companies) to create a new, premium version of Tide detergent.

Question 20

Entrepreneurial ventures often produce more radical innovations than do their larger, more established counterparts.

Accepted Answer

Entrepreneurial ventures are typically more agile and more willing to take risks, which can lead to more radical innovations. Established companies may be more focused on maintaining their current market position and may be hesitant to invest in risky new ideas.

Quiz 13: Strategic Entrepreneurship