Innovation technology questions 1 Explain how computer-aided design and flexible manufacturing technologies help create small niches in the market place. Provide an example to illustrate your answer Answer: Computer-aided design and flexible manufacturing help create small niches in the marketplace by allowing firms to develop and produce a greater number of versions of their products. This means that companies can now tailor their offerings to small niches in the marketplace. For example, in 2012, Toyota offered 16 different passenger vehicle lines under the Toyota brand (e.g., Camry, Prius, Highlander, and Tundra). Within each of the vehicle lines, Toyota also offered several different models (e.g., Camry L, Camry LE, Camry SE) with different features and at different price points. Students’ answers will vary. Page: 1 2At a retreat by the Cleveland City Council, community leaders held a discussion on attracting and developing new businesses and increasing employment rates in the city. One leader suggested that the city should consider sponsoring a business incubator. Explain what an incubator is and how this might help the city meet its goals. What other ideas should be considered Answer: An incubator is an institution designed to nurture the development of new businesses that might otherwise lack access to funding or advice. It allows companies to share costs and resources until they can stand on their own. If an incubator were started in Salisbury, it would help new businesses to grow and prosper. These businesses could then move out to locations of their own and hire local residents as employees. The city would not have to offer tax breaks or compete with other cities for the location of existing companies, but would be growing their own businesses. Page: 29-31 3 How can the s-curves be used as a prescriptive tool? What would be the limitations of this approach? Answer: Managers can use the s-curve model as a tool for predicting when a technology will reach its limits and as a prescriptive guide for whether and when the firm should move to a new, more radical technology. Firms can use data on the investment and performance of their own technologies, or data on the overall industry investment in a technology and the average performance achieved by multiple producers. Managers could then use these curves to assess whether a technology appears to be approaching its limits or to identify new technologies that might be emerging on s-curves that will intersect the firm’s technology s-curve. Managers could then switch s-curves by acquiring or developing the new technology. However, there are many limitations to doing this. First, it is rare that the true limits of a technology are known in advance, and there is often considerable disagreement among firms about what a technology’s limits will be. Second, the shape of a technology’s s-curve is not set in stone. Unexpected changes in the market, component technologies, or complementary techno.

1. Innovation technology questions
1 Explain how computer-aided design and flexible
manufacturing technologies help create small niches in the
market place. Provide an example to illustrate your answer
Answer: Computer-aided design and flexible manufacturing
help create small niches in the marketplace by allowing firms to
develop and produce a greater number of versions of their
products. This means that companies can now tailor their
offerings to small niches in the marketplace. For example, in
2012, Toyota offered 16 different passenger vehicle lines under
the Toyota brand (e.g., Camry, Prius, Highlander, and Tundra).
Within each of the vehicle lines, Toyota also offered several
different models (e.g., Camry L, Camry LE, Camry SE) with
different features and at different price points. Students’
answers will vary.
Page: 1
2At a retreat by the Cleveland City Council, community leaders
held a discussion on attracting and developing new businesses
and increasing employment rates in the city. One leader
suggested that the city should consider sponsoring a business
incubator. Explain what an incubator is and how this might help
the city meet its goals. What other ideas should be considered
Answer: An incubator is an institution designed to nurture the
development of new businesses that might otherwise lack access
to funding or advice. It allows companies to share costs and
resources until they can stand on their own. If an incubator were
started in Salisbury, it would help new businesses to grow and
prosper. These businesses could then move out to locations of
their own and hire local residents as employees. The city would
not have to offer tax breaks or compete with other cities for the
location of existing companies, but would be growing their own
businesses.

2. Page: 29-31
3 How can the s-curves be used as a prescriptive tool? What
would be the limitations of this approach?
Answer: Managers can use the s-curve model as a tool for
predicting when a technology will reach its limits and as a
prescriptive guide for whether and when the firm should move
to a new, more radical technology. Firms can use data on the
investment and performance of their own technologies, or data
on the overall industry investment in a technology and the
average performance achieved by multiple producers. Managers
could then use these curves to assess whether a technology
appears to be approaching its limits or to identify new
technologies that might be emerging on s-curves that will
intersect the firm’s technology s-curve. Managers could then
switch s-curves by acquiring or developing the new technology.
However, there are many limitations to doing this. First, it is
rare that the true limits of a technology are known in advance,
and there is often considerable disagreement among firms about
what a technology’s limits will be. Second, the shape of a
technology’s s-curve is not set in stone. Unexpected changes in
the market, component technologies, or complementary
technologies can shorten or extend the life cycle of a
technology. Furthermore, firms can influence the shape of the s-
curve through their development activities. For example, firms
can sometimes stretch the s-curve through implementing new
development approaches or revamping the architecture design of
the technology.
Page: 55
4 Explain what factors characterize the technology trajectory.
Discuss the factors that determine the success of a new
technology, besides its quality and technical advantage. Include
a diagram showing the trajectory and the factor’s influence
Answer: Increasing returns to adoption also imply that

3. technology trajectories are characterized by path dependency,
meaning that relatively small historical events may have a great
impact on the final outcome. Though the technology’s quality
and technical advantage undoubtedly influence its fate, other
factors, unrelated to the technical superiority or inferiority, may
also play important roles. For instance, timing may be crucial;
early technology offerings may become so entrenched that
subsequent technologies, even if considered to be technically
superior, may be unable to gain a foothold in the market. How
and by whom the technology is sponsored may also impact
adoption. If, for example, a large and powerful firm
aggressively sponsors a technology (perhaps even pressuring
suppliers or distributors to support the technology), that
technology may gain a controlling share of the market, locking
out alternative
technologies.
Page: 72
5. Even though many aerospace manufacturing firms are very
profitable, there are very few upcoming firms. Explain the
reason using Porter's five-force model.
Answer: According to Porter’s five-force model, the threat of
potential entrants is influenced by both the degree to which the
industry is likely to attract new entrants (i.e., is it profitable,
growing, or otherwise alluring?) and the height of entry
barriers. Entry barriers can include such factors as large start-up
costs, brand loyalty, difficulty in gaining access to suppliers or
distributors, government regulation, threat of retaliation by
existing competitors, and many others. In the aerospace
manufacturing industry, this threat is relatively low because of
the entry barriers. The cost of starting an aerospace company is
high and the existing companies are well-established. These
companies are large, have the contacts, personnel, and skills

4. necessary to meet the market demand, making it almost
impossible for a new company to compete with them.
Page: 112