Chapter 6—Innovation and Change
TRUE/FALSE
1. Organizational innovation is defined as “doing things differently” inside an organization.
2. A technology cycle begins with the birth of a new technology and ends when that technology reaches
its limits and dies; it is then replaced by newer, substantially better technology.
3. Nearly all technology cycles follow a bell-shaped pattern of innovation.
4. The typical S-curve pattern of innovation indicates that both early and late in the technology cycle,
increased effort (i.e., money, research and development) brings only small improvements in
technological performance.
5. Companies that want to sustain a competitive advantage must understand and protect themselves from
the strategic threats of innovation.
6. Innovation streams are patterns of innovation over time that can create sustainable competitive
advantage.
7. An innovation stream begins with a technological discontinuity, which is a scientific advance or a
unique combination of existing technologies creating a significant breakthrough in performance or
function.
8. Technological innovation not only makes it possible to duplicate the benefits obtained from a
company’s distinctive advantage but also quickly creates an opportunity to turn a company’s
competitive advantage into a competitive disadvantage.
9. Technology cycles for low-tech products follow the typical U-curve pattern cycle of innovation.
10. Technological discontinuities are followed by discontinuous change characterized by technological
substitution and design competition.
11. Dominant designs emerge because they solve a practical problem, are a result of the negotiations of
independent standards bodies, or because of critical mass.
12. The same techniques for managing innovation work equally as well after technological discontinuities
as during periods of incremental change.
13. A creative work environment requires organizational encouragement and supervisory encouragement
as well as work group encouragement.
14. The three parts of the experiential approach to innovation are design iterations, testing, and milestones.
15. Milestones are formal review points that tend to lengthen the innovation process.
16. Fully functional change occurs when incremental improvements are made to a dominant technological
design. In a fully functional change, the improved version of the technology is fully backward
compatible with the older version.
17. According to Kurt Lewin, managing organizational change is a simple process that requires
organizational dialogue, change intervention, and reformatting.
18. Resistance to change usually results from organizational factors: such as the absence of promotion
guidelines, bonuses, and praise.
19. Even though education and communication, participation, negotiation, top management support, and
coercion can all be used to manage resistance to change, coercion should be used only in a crisis or as
a last resort.
20. Declaring victory too soon is one of the mistakes managers often make in the refreezing stage of
change.
21. Results-driven change focuses primarily on changing company procedures, management philosophy,
or employee behavior.
22. The General Electric Workout is a special kind of activity-oriented change.
MULTIPLE CHOICE
1. Organizational ____ is the successful implementation of creative ideas in organizations.
a.
change
b.
innovation
c.
creativity
d.
development
e.
deployment
2. ____ refers to the production of novel and useful ideas.
a.
The synergistic use of resources
b.
Ideation
c.
Creativity
d.
Organizational adaptation
e.
Innovative style
3. Creativity was needed to improve efficiency without raising costs at one automobile maker. Over the
last few years, the company has successfully implemented a creative engineering program that allows
its plants to produce more than one type of car from the same assembly line. This successful change to
a flexible manufacturing system is an example of ____.
a.
corporate synergy
b.
organizational innovation
c.
assembly networking
d.
organizational networking
e.
reverse engineering
4. When Gregg Steiner became the vice president for Cleveland-based Pinxav, he knew the diaper-rash
product manufacturer’s sales were declining. At a trade show Steiner was pitching the product to some
new mothers who had never heard of it. The mothers weren’t convinced that they should part with their
money for a new-to-them product. The inspired Steiner said, “If you’re not happy with the product, I
will not only give you your money back, I’ll buy you our competitors’ product. I’ll buy you whatever
other brand you want.” Suddenly the women were interested, and they all plunked down their money.
None of the women ever took Steiner up on his offer. So Steiner decided to make it part of his business
practice. This new guarantee was an example of ____.
a.
corporate synergy
b.
organizational innovation
c.
assembly networking
d.
organizational networking
e.
reverse engineering
5. The development of the DVD player was a source of ____ to companies in the movie industry just as
VHS tapes had once been.
a.
a sustainable competitive advantage
b.
creativity reengineering
c.
technological discontinuity
d.
planned shrinkage
e.
technological replacement
6. ____ is the knowledge, tools, and techniques used to transform inputs into outputs.
a.
Resource manipulation
b.
Procedural innovation
c.
A transformation system
d.
Technology
e.
Creativity
7. A technology ____ begins with the birth of a new technology and ends when that technology reaches
its limits and dies as it is replaced by a newer, substantially better technology.
a.
process
b.
pattern
c.
cycle
d.
hierarchy
e.
continuum
8. Nearly all technology cycles follow the typical ____ pattern of innovation.
a.
W-curve
b.
U-curve
c.
bell-shaped
d.
S-curve
e.
V-shaped
9. In the typical S-curve pattern of innovation, increased effort (i.e., money, research and development)
brings only small improvements in technological performance ____,
a.
early in the cycle
b.
throughout the cycle
c.
at the end of the cycle
d.
at both the beginning and end of the cycle
e.
in the maturity stage of the cycle
10. In the typical S-curve pattern of innovation, small amounts of effort will result in significant increases
in performance ____.
a.
during the growth stage of the cycle
b.
at the midpoint of the cycle
c.
only at the end of the cycle
d.
throughout the cycle
e.
only at the beginning of the cycle
11. In the typical S-curve pattern of innovation, increased effort (i.e., money, research, and development)
brings only small improvements in technological performance when performance limits of the
technology are reached ____.
a.
during the introductory stage of the cycle
b.
at the breakeven point of the cycle
c.
during the maturity stage of the innovation cycle
d.
throughout the cycle
e.
at the end of the cycle
12. When significant improvements in performance can ONLY be gained through radical new designs or
new performance-enhancing materials, it is likely that a company is ____ in the S-curve pattern of
innovation.
a.
at its breakeven point
b.
at the problem identification stage of the innovation cycle
c.
at the end of the innovation cycle
d.
at either the beginning or end of the innovation cycle
e.
at the end of its maturity stage
13. A technology cycle occurs whenever there are major advances or changes in the ____ in a field or
discipline.
a.
human, technical, and conceptual skills needed
b.
structure or personnel requirements
c.
internal resource environment
d.
knowledge, tools, and techniques
e.
way information is integrated
14. Patterns of innovation over time that can create sustainable competitive advantage are called ____.
a.
innovation maps
b.
organization development
c.
results-driven change
d.
innovation streams
e.
cyclical inventions
15. An innovation stream moves from one technology cycle to another through the process of ____.
a.
technological substitution
b.
dominant design
c.
incremental environmental change
d.
organizational synergy
e.
transition management
16. In terms of innovation streams, what ____ occurred when customers purchased flat-screen computer
monitors to replace the older, bulkier monitors.
a.
technological substitution
b.
technological expansion
c.
reengineering
d.
demarketing
e.
the pioneering era
17. When a U.S. automaker learned that it took longer than any other U.S. car manufacturer to assemble a
vehicle, it purchased newer, more flexible manufacturing systems to replace its older ones. Which
stage of the technology cycle did it enter?
a.
technological adaptation
b.
the era of dominant design
c.
the technological growth stage
d.
change substitution
e.
discontinuous change
18. Kodak is a company associated with photography. The development of the digital camera forced
Kodak into the innovation stream because the new imaging process was a(n) ____.
a.
technological subtraction
b.
technological discontinuity
c.
process obsolescence
d.
process addition
e.
example of design advantage
19. Kodak is a company associated with photography. The company has recognized that digital
photography is a threat to the future growth of the company’s film business. Therefore, the company
has decided to become a market leader in digital imaging. As Kodak tried to compete in this new
innovation stream, it entered ____.
a.
technological adaptation
b.
the era of dominant design
c.
the technological growth stage
d.
change substitution
e.
discontinuous change
20. Kodak is a company associated with photography. The company has recognized that digital
photography is a threat to the future growth of the company. Therefore, the company has decided to
become a market leader in digital imaging while still providing customer support for people still using
film cameras. The existence of both technologies is an example of ____.
a.
design substitution
b.
modular management
c.
design competition
d.
hierarchical management
e.
a creative flow
21. ____ is the phase of a technology cycle characterized by technological substitution and design
competition.
a.
Technological adaptation
b.
The era of dominant design
c.
The technological growth stage
d.
Change substitution
e.
Discontinuous change
22. The purchase of new technologies to replace older ones is an example of ___.
a.
adaptive change
b.
design replacement
c.
technological substitution
d.
dominant design
e.
innovative exchange
23. Discontinuous change in an innovation stream is characterized by ____.
a.
synergy
b.
technological substitution
c.
incremental change
d.
empathetic design
e.
innovative reciprocity
24. During the ____ phase of a technology cycle, companies innovate by lowering the cost and improving
the functioning and performance of the dominant design.
a.
technological discontinuity
b.
discontinuous change
c.
dominant design
d.
incremental change
e.
technological continuity
25. In order from beginning to end, the phases of a technology cycle within an innovation stream consist
of ____.
a.
incremental change, discontinuous change, dominant design, and technological
discontinuity
b.
discontinuous change, incremental change, technological discontinuity, and dominant
design
c.
dominant design, discontinuous change, era of incremental change, and technological
discontinuity
d.
technological discontinuity, discontinuous change, dominant design, and incremental
change
e.
technological discontinuity, incremental change, discontinuous change, and technological
continuity
26. The auto industry has been perfecting the internal combustion engine (ICE) for some 120 years. The
Partnership for a New Generation of Vehicles (PNGV), a cooperative program between the Big Three
and the U.S. government to replace ICEs with electric engines, has been operating since 1993. The
internal combustion engine (ICE) is an example of ____.
a.
a dominant design
b.
design dichotomy
c.
a synergistic design
d.
a differential design
e.
a dichotomous product
27. Titleist has been manufacturing golf balls for several years, but each year it comes out with new golf
ball designs. Titleist’s development of the new Pro VI golf ball with a solid core designed to benefit
players with high swing speeds is one example of how the manufacturer survives through ____.
a.
technological discontinuity
b.
discontinuous change
c.
dominant design
d.
incremental change
e.
technological continuity
28. Companies need to excel at managing ____ in order to successfully manage innovation streams.
a.
the sources of innovation
b.
innovation during synergistic change
c.
reciprocity
d.
environmental design issues
e.
behavioral formality
29. ____ are workplace cultures in which workers perceive that new ideas are welcomed, valued, and
encouraged.
a.
Creative work environments
b.
Innovative societies
c.
Homogeneous work environments
d.
Participative work teams
e.
Empathetic work stations
30. Which of the following is NOT one of the components of creative work environments?
a.
challenging work
b.
group compensation
c.
freedom
d.
supervisory encouragement
e.
organizational encouragement
31. Which of the following is a component of a creative work environment that encourages creativity?
a.
the development of challenging work
b.
organizational encouragement
c.
the granting of autonomy
d.
the removal of organizational impediments
e.
all of these
32. Kodak is a company associated with photography and has decided to become a market leader in digital
imaging. Kodak can encourage the development of a culture where workers perceive that new ideas
are welcomed by offering challenging work and supervisory encouragement. In other words, the
company can create a(n) ____.
a.
creative work environment
b.
open system
c.
adaptive culture
d.
culture of change
e.
tall structure to encourage horizontal communications
33. Hewlett-Packard is currently exploring new products and markets through the development of digital
imaging products in its plants in India, South Africa, and the United States. To jump-start this
innovative process, Hewlett-Packard can ____ across all of its plants around the world.
a.
manage flow through the use of Gantt charts
b.
concentrate on dominant design and ignore incremental design
c.
engage in creative reciprocity
d.
establish creative work environments
e.
do none of these
34. Which of the following is an organizational impediment to creativity in a work environment?
a.
internal conflict
b.
rigid management structures
c.
bias toward the status quo (i.e., a conservative environment)
d.
power struggles
e.
all of these
35. Unverferth Manufacturing has been a manufacturer and supplier of innovative agricultural equipment
since 1948. Recently it began developing a new 12-row strip-till subsoiler, which prepares
10-inch-wide seed beds spaced 40 inches apart. Before introducing the new tiller to the market,
Unverferth developed and tested nearly three-dozen product prototypes. Unverferth used the ____
approach to innovation.
a.
compression
b.
experiential
c.
technological substitution
d.
generational change
e.
technological disruption
36. Unverferth Manufacturing has been a manufacturer and supplier of innovative agricultural equipment
since 1948. Recently it began developing a new 12-row subsoiler, which prepares 10-inch-wide seed
beds spaced 40 inches apart. Before introducing the new tiller to the market, Unverferth developed and
tested nearly three dozen product prototypes. Unverferth used ____ to produce the best possible tiller
before introducing it to the market.
a.
service development
b.
process duplication
c.
design iteration
d.
design compliance
e.
process reengineering
37. The ____ approach to innovation assumes that innovation is occurring within a highly uncertain
environment and that the key to fast product innovation is to use intuition, flexible options, and
hands-on experience to reduce uncertainty and accelerate learning and understanding.
a.
compression
b.
experiential
c.
technological substitution
d.
generational change
e.
technological disruption
38. Which of the following is NOT a part of the experiential approach to innovation?
a.
hands-on experience to reduce uncertainty
b.
testing
c.
multifunctional teams
d.
design iterations
e.
initiative conversations
39. Covisint is an e-commerce venture involving many car manufacturers that allows carmakers access to
online auctions for buying component parts and materials. Because the idea of such a Web site was a
new concept, the prototype site was built and tested, then revised and rebuilt for further testing before
the Web site was ever offered to customers. The management concept of ____ was used to develop
Covisint.
a.
serve development
b.
process duplication
c.
design iteration
d.
design compliance
e.
process reengineering
40. The use of milestones in the experiential approach to innovation ____.
a.
serves to eliminate manufacturing bottlenecks
b.
shortens the innovation process
c.
creates incrementally sustainable advantages
d.
virtually eliminates problems associated with the control function of management
e.
does all of these
41. What is the first step for managing innovation during discontinuous change?
a.
design iteration
b.
budgeting
c.
the establishment of a dominant design
d.
supplier involvement
e.
process duplication
42. The use of milestones in the experiential approach to innovation ____.
a.
provides structure to the general chaos that follows technological discontinuities
b.
shortens the innovation process
c.
builds momentum by giving people a sense of accomplishment
d.
lets an organization know when to take corrective action
e.
does all of these
43. The purpose of multifunctional teams is to ____.
a.
allow organizations to concentrate on their internal environments and ignore the external
environments until they have completed the brainstorming process
b.
were primarily used by dot-coms and are no longer popular
c.
speed innovation through early identification of new ideas or problems that would
typically not have been generated until much later
d.
do not typically use milestones because of group cohesiveness
e.
replace organizational structures on a typical organizational chart
44. The ____ approach to managing innovation assumes that innovation is a predictable process made up
of a series of steps and that compressing the time it takes to complete those steps can speed up
innovation.
a.
compression
b.
milestones
c.
dialectical
d.
generational
e.
prototypical
45. ARI is a leading provider of sales and profit-building technology services for equipment dealers. When
Unverferth Manufacturing, a supplier of agricultural equipment, wanted to change the way it supplied
information it contacted ARI. ARI presented the manufacturer with a solution that allowed it to replace
its paper catalogs with online catalogs. As a result, Unverferth was able to eliminate costly paper
catalogs and gain the ability to provide up-to-the-minute information to its dealers. This incremental
change that was aided by supplier involvement was an example of the ____ approach to innovation.
a.
generational
b.
experiential
c.
milestones
d.
compression
e.
supply-side
46. It is appropriate to use a(n) ____ approach to manage innovation in more certain environments during
periods of incremental change, in which the goals are lower costs and incremental improvements in the
performance and function of the existing technological design.
a.
experiential
b.
compression
c.
prototypical
d.
milestones
e.
reinforcement
47. The goals of the compression approach to innovation are ____.
a.
speed, lower costs, and incremental change of dominant design
b.
the development of milestones and the comparison of actual milestones with forecasts
c.
the establishment of a dominant design and speed
d.
absolute-time management and the creation of a dominant design
e.
a matrix innovation process and a sustainable competitive advantage
48. The first step in the compression approach to innovation is ____.
a.
overlapping of the individual steps
b.
planning
c.
supplier involvement
d.
granting autonomy
e.
creating multifunctional teams
49. When incremental improvements are made to a dominant technological design such that the improved
version of the technology is fully backward compatible with the older version, ____ is said to have
occurred.
a.
a milestone
b.
intuitive change
c.
generational change
d.
coercive change
e.
discontinuous innovation
50. Unverferth Manufacturing makes agricultural equipment. It used finite element analysis (FEA)
software to speed up the design cycle for its 12-row sub-soiler. Which aspect of the compression
approach to innovation would the use of this software apply?
a.
planning
b.
supplier involvement
c.
shortening the time of individual steps
d.
multifunctional teams
e.
functional isolation
51. Backward compatibility is an important consideration for software users who are using an accounting
program to facilitate their tax preparation and who want to use a newer version that has greater
capacity. Therefore, many software manufacturers engage in ____.
a.
coercive change
b.
dominant design manipulation
c.
generational change
d.
intuitive change
e.
incremental modification
52. ____ forces support the status quo.
a.
Dialectical
b.
Generational
c.
Resistance
d.
Experiential
e.
Autonomous
53. According to social psychologist Kurt Lewin, ____ lead to differences in the form, quality, or
condition of an organization over time, while ____ support the status quo, or the existing state of
conditions in an organization.
a.
compressed changes; generational changes
b.
generational forces; resistance forces
c.
generational changes; inertial changes
d.
change forces; inertial forces
e.
change forces; resistance forces
54. Which of the following is one of the sources of resistance to change?
a.
self-interest
b.
multifunctional teams
c.
a dynamic organizational culture
d.
discontinuous innovation
e.
sustainable status quo
55. Which of the following statements about resistance to change is true?
a.
Resistance to change will not occur when those affected by the change participate in its
planning and implementation.
b.
Resistance to change will not occur when employees are educated about the need for
change.
c.
Resistance to change will not occur when change efforts receive significant managerial
support.
d.
Resistance to change disappears when the organization operates in conditions of certainty.
e.
Resistance to change will always occur; it is inevitable.
56. Which of the following is one of the three steps in the basic process of managing organizational
change outlined by Kurt Lewin?
a.
unfreezing
b.
organizational dialogue
c.
change definition
d.
incremental change
e.
change mentoring
57. The three steps in the basic process of managing organizational change outlined by Kurt Lewin are
____.
a.
unfreezing, change intervention, and refreezing
b.
organizational change, departmental change, and individual change
c.
change definition, change motivation, and change
d.
synthesizing, motivating, and rewarding
e.
change definition, change mobilization, and change acceptance
58. Which of the following is NOT one of the basic methods for managing resistance to change?
a.
education and communication
b.
participation
c.
change simulation
d.
negotiation
e.
coercion
59. When resistance to change is based on insufficient, incorrect, or misleading information, managers
should use ____ as an approach to manage resistance.
a.
education and communication
b.
participation
c.
negotiation
d.
coercion
e.
change manipulation
60. Downsizing has thinned the ranks of hospital personnel. Hospital employees were adamantly resisting
any more change. What method could hospital administrators use to manage this resistance?
a.
educate employees about the need for change
b.
let the employees participate in implementing the change process