Which of these is one of the errors that companies are prone to make
during the idea validation phase?
A) Not considering brand naming
issues early enough
B) Failing to reject ideas with little or no
merit
C) Putting too much emphasis on distribution challenges too
early
D) Failing to engage top management
E) Failing to get
employee input
B
Which of these is a critical "reality check" that must be
applied to bottom-up product ideas in particular?
A) They must
have a unique brand name.
B) They must fit smoothly in the
company's current product portfolio.
C) They must address a
viable market opportunity.
D) They must be compatible with the
company's current distribution networks.
E) They must not place a
demand on company resources.
C
Why is top-down idea generation the preferred way of coming up with
new product ideas?
A) It is based on viable market
opportunities.
B) It is cheaper.
C) It is faster.
D) It
uses fewer company resources.
E) It lets companies bypass stages
in the stage-gate framework.
A
Firms can help establish the optimal brand positioning for a new
product and the right points of parity and points of differences by
________ during the idea generation stage.
A) interviewing
employees
B) observing customers
C) analyzing the
competition
D) crowdsourcing
E) interviewing customers
C
A research team in your company's laboratories stumbled on a way to
erase hard drives using radio waves. The scientists think it could
turn into a great product that gives computer users an easy way to
erase their drives before sending their devices to recycling or
reselling them. What model of idea generation is this?
A)
Exploratory
B) Top-down
C) Research-driven
D)
Bottom-up
E) Incremental
D
The search for ________ is the starting point of new-product
development.
A) viable ideas
B) unused brand names
C)
distribution channels
D) profitable business models
E)
customer value
A
When Varidesk responded to health concerns about the long-term
effects of sitting by creating variable desks that allow people to
change from sitting to standing throughout the day, it
used which
model of idea generation?
A) Exploratory
B) Top-down
C)
Research-driven
D) Bottom-up
E) Incremental
B
The Slinky toy was created after a naval engineer who was designing a
power meter noticed how tension springs bounced when they fell to the
floor. What model of idea generation is this?
A)
Exploratory
B) Bottom-up
C) Research-driven
D)
Top-down
E) Incremental
B
Innovation marries a customer need with a ________ that addresses
this need.
A) brand
B) value proposition
C) creative
idea
D) business model
E) distribution network
C
Top-down idea generation starts with a ________ that aims to identify
an important unmet need that the company can fulfill in a way that is
superior to its competitors.
A) business plan
B) market
analysis
C) value proposition
D) market offering
E) prototype
B
________ means inviting the internet community to help create content
or software, often with prize money or a moment of glory
involved.
A) Stage-gating
B) Cocreation
C)
Microstocking
D) Buzzing
E) Crowdsourcing
E
Some companies believe that interviewing customers does not always
help to create better, or new, products. This belief rests on which of
the following ideas?
A) Such new product developments decrease
the chances of success.
B) Customers do not consider the cost of
design when making suggestions.
C) Customers often focus on their
current needs, which can prevent breakthrough,
forwardthinking
innovation.
D) It increases the cost of
testing a product or service.
E) Having too much customer focus
leads to a negative brand image.
C
A(n) ________ is a working model of the offering that aims to flesh
out the original idea and weed out potential problems before the
actual offering is created.
A) business model
B) tactical
plan
C) alpha test
D) prototype
E) beta test
D
________ involves customers interacting with prototypes to see how
they perform in different applications and to ensure that the final
product will be well received in the market.
A) Beta
testing
B) Alpha testing
C) Market testing
D) Omega
testing
E) Lab testing
A
________ involves members of the firm interacting with prototypes to
see how they perform in different applications and to ensure that the
final product will be well received in the market.
A) Beta
testing
B) Alpha testing
C) Market testing
D) Omega
testing
E) Lab testing
B
Brown & Smith Inc. engages in the design, development, making,
and retail selling of designer jewelry in North America. Before
approving a new design, the company draws it on a computer and then
produces models to show potential consumers and get their reactions.
This allows the company to analyze the possible customer reaction.
Identify the concept development method used here.
A) Conjoint
analysis
B) Perceptual mapping
C) Virtual reality
testing
D) Prototyping
E) Digital fabrication
D
After creating a product prototype, a company tests it within the
firm to see how it performs in different applications. The company
refines the prototype to correct the mistakes found in inhouse
testing. What should be the next step?
A) Commercializing the
product
B) Performing concept testing
C) Conducting beta
testing with customers
D) Creating a marketing strategy for the
product
E) Performing business analysis
C
Consumer preferences for alternative product concepts can be measured
through ________, a method for deriving the utility values that
consumers attach to varying levels of a product's attributes.
A)
concept testing
B) perceptual mapping
C) gap level
analysis
D) conjoint analysis
E) morphological analysis
D
With ________, respondents see different hypothetical offers formed
by combining varying levels of the attributes, then rank the various
offers.
A) gap level analysis
B) conjoint analysis
C)
perceptual mapping
D) concept testing
E) morphological analysis
B
Universal Services Inc. provides communication services to
residential and business customers in rural and small urban
communities primarily in northern England. The company offers services
such as local and long distance voice, data, and internet and
broadband product offerings. The company, in an attempt to increase
the attractiveness of its offerings, decides to provide special voice
and data packages to its customers. The company designs eight
different packs that offer varying voice and data benefits to
customers. The company then asks some of its customers to rank the
packs in order to choose two best packs. Which of the following
testing methods is being used in this scenario?
A) Virtual
reality testing
B) Conjoint analysis
C) Perceptual
mapping
D) Product fabrication
E) Rapid prototyping
B
________ testing of a prototype takes place within the firm to see
how it performs in different applications.
A) Beta
B)
Research
C) Sales-wave
D) Alpha
E) Simulated
D
Which of the following products normally undergo alpha and beta
testing?
A) Food products
B) Expensive industrial
goods
C) Consumer products
D) Commodities
E) FMCG products
B
During ________ testing, the company's technical people let customers
use prototypes to see how they perform in different applications and
to ensure that the final product will be well received in the
market.
A) beta
B) research
C) sales-wave
D)
alpha
E) simulated
A
With a product concept that has been deemed technologically feasible
and desirable from the target customer's point of view, the ________
stage judges whether the concept has commercial viability.
A)
concept validation
B) business-model design
C) idea
generation
D) commercialization
E) offering development
B
In addition to identifying the target market and describing the
market offering, the businessmodel design stage details the offering's
________.
A) distribution plan
B) branding
C) value
proposition
D) financial payback
E) investment requirements
C
By losing money on most sales, the pioneering e-commerce site
Pets.com ultimately failed because it didn't pass the ________ test of
the business-model design stage.
A) visibility
B)
desirability
C) demand
D) viability
E) popularity
D
Despite a massive promotional campaign, the clear, caffeine-free
Crystal Pepsi offering did not succeed in the marketplace because it
failed the ________ test of the business-model design stage.
A)
visibility
B) desirability
C) demand
D)
viability
E) popularity
B
In addition to creating value for the company and for its
collaborators, a key part of the business-model design stage is making
the sure an offering will create value for ________.
A)
distributors
B) advertisers
C) sales representatives
D)
suppliers
E) customers
E
Before a new-offering team transitions to the business-model design
stage, it should successfully pass the ________ stages.
A) idea
generation and concept development
B) concept development and
offering development
C) concept development and commercial
development
D) offering development and commercial
development
E) commercialization and commercial development
A
When a new-offering team has successfully made it past the
business-model validation gate, it is ready to begin the ________
stage.
A) idea generation
B) concept development
C)
offering development
D) commercial development
E) product launch
C
Describing how the company will create, communicate, and deliver
value to its target customers, collaborators, and the company
stakeholders is embodied in which component of business-model
design?
A) Target market
B) Value proposition
C) Market
offering
D) Marketing plan
E) Business plan
C
Which of these is NOT one of the entities that needs to be identified
as part of the target market definition task in the business-model
design stage?
A) Target customers
B) Distribution
collaborators
C) Customer service collaborators
D)
Competitors
E) Advertising partners
E
Building a forecast on the basis of ________ means putting the
product into a test market to measure buyer response.
A) what
customers intended to do
B) what customers say they will
do
C) what customers do
D) what customers have done
E)
what researchers predict customers will do
C
Which of these is NOT one the resources identified as a requirement
to launch a new product?
A) Business facilities
B) Supply
channels
C) Distribution channels
D) Corporate
heritage
E) Skilled employees
D
Which of these products would potentially benefit the most from
market testing?
A) An all-new model of Chevrolet pickup
truck
B) A larger version of a Samsung smartphone
C) An
update to the Duolingo language-learning app
D) A new flavor of
Cheerios breakfast cereal
E) A spinoff of a successful mutual
fund that targets a different investment sector
A
Why does Gucci test market many of it luxury products in
China?
A) To benefit from proximity to Chinese manufacturing
facilities.
B) The Chinese government demands first access to new
products.
C) Consumer preferences in China indicate where the
global market is moving.
D) To avoid "signaling" the
new product to the rest of the world.
E) To test a representative
demographic cross-section.
C
Developing the market offering involves turning the ________ into a
market-ready
commodity.
A) brand
B) business
model
C) prototype
D) product idea
E) marketing plan
C
Why does General Mills prefer to launch new products in 25 percent of
the country?
A) This keeps its plants operating at optimal
capacity.
B) It's an area too large for rivals to
disrupt.
C) This makes the best use of retailer capacity.
D)
Retailers won't cooperate with larger launches.
E) Retailers
won't cooperate with smaller launches.
B
Which of these is a reason many consumer-goods companies like to
test-market new products in South Korea?
A) They can hide the
prelaunch test from the rest of the world.
B) Its well-developed
marketing infrastructure prevents other companies from spying.
C)
Its consumers are known to be demanding but fair-minded.
D) Its
consumers reflect the tastes of the majority of the world's
cultures.
E) The South Korean government offers subsidies to
defray the costs of test marketing.
C
Implementing the offering involves two key aspects: developing the
________ to put the business model into action and developing the
market offering.
A) branding strategy
B) necessary
resources
C) employee motivation
D) top-management
approval
E) advertising plan
B
________ informs target customers about the company's offering and
makes the offering available to these customers.
A)
Advertising
B) Commercialization
C) Integrated marketing
communication
D) A distribution plan
E) A business plan
B
In addition to ramping up the facilities involved in the offering's
production and promoting the offering to all target customers, market
expansion involves ________.
A) ensuring that the offering is
available to the entire target market
B) ensuring that the
offering is available to the next chosen subsegment of the target
market
C) explaining the brand essence to target
customers
D) announcing the product launch to the news
media
E) preparing the workforce for the product launch
A
The term ________ refers to the way knowledge of a product, service,
or idea spreads to the marketplace and the speed with which it is
purchased or used.
A) product learning
B) customer
education
C) leaders and laggards
D) diffusion of
innovation
E) customer adoption
D
The key aspects of commercialization are ________ followed by market
expansion.
A) launch planning
B) selective market
deployment
C) test marketing
D) market preparation
E)
offering development
B
Your roommate refuses to get a smartphone, no matter how many cool
apps you show him or how many times you explain all the ways its helps
you manage your life and your studies. What type of consumer does he
represent in the Rogers or Moore models of adoption?
A)
Innovator
B) Early adopter
C) Pragmatist
D)
Laggard/Skeptic
E) Late majority
D
In the Rogers model of adoption, customers who are technology
enthusiasts, venturesome, and who enjoy tinkering with new products
and mastering their intricacies are called ________.
A)
innovators
B) early adopters
C) early majority
D)
investigators
E) experimenters
A
Troma Inc. is a famous manufacturer of cookware that follows a
traditional distributor-retailer system to distribute its products.
The company abstains from the use of automated supply chain management
(SCM) systems mainly due to the fear of unknown. However, rapidly
escalating operational costs and inefficiencies have made it necessary
for the company to implement an SCM system. The company goes for a
big-bang installation of SCM system to become more competitive and
cost effective. Identify the adopter group to which Troma
belongs.
A) Innovator
B) Early adopter
C) Early
majority
D) Laggard
E) Late majority
D
Jason is a technology enthusiast who is happy to conduct alpha and
beta testing and report on early weaknesses of consumer electronics
products. He is most likely to fall in the ________ adopter
category.
A) late majority
B) early
C) early
majority
D) innovator
E) laggard
D
Which of the following characteristics is closely associated with
late majority adopter groups?
A) Superior technological
knowledge
B) Low price sensitiveness
C) Opinion
leadership
D) Deliberate pragmatism
E) High risk aversion
E
________ involves entering new markets by tweaking products for new customers, using variations on a core product to stay one step ahead of the market, and creating interim solutions for industry-wide problems.
A) Supplemental innovation
B) Incremental
innovation
C) Disruptive innovation
D) New-market
innovation
E) Breakthrough innovation
B
Which of these is identified in the chapter as one reason companies continue to pursue incremental innovation over new-to-the-world innovations?
A) Tax laws favor incremental innovation.
B) Employees
dislike the disruption of breakthrough innovation.
C) Customers
are rarely interested in breakthrough innovation.
D) It is
increasingly difficult to identify blockbuster products that will
transform a market.
E) Breakthrough innovations invite vigorous
competitive responses
D
What is the estimated failure rate of new products?
A) Less than 10 percent
B) Between 10 and 20
percent
C) Around 25 percent
D) Around 50 percent
E)
As high as 95 percent
E
4) Intrapreneurs working on new product designs and plans are mostly to be found working in ________.
A) product management departments
B) venture teams
C)
new-product departments
D) communities of
practice
E) skunk squads
B
Which of these is NOT one of the stages found in the stage-gate framework?
A) Idea generation
B) Concept development
C)
Business-model design
D) Offering development
E) Sales prospecting
E
Which stage in the stage-gate framework must come before concept development?
A) Business-model design
B) Idea generation
C)
Commercial deployment
D) Offering development
E) Sales prospecting
B
When a firm has a valid business model in hand for a new offering, what is its next step in the stage-gate framework?
A) Concept development
B) Idea generation
C)
Commercial deployment
D) Offering development
E) Sales prospecting
D
In addition to creating offerings that are desirable to customers and technologically feasible, the stage-gate framework aims to create offerings that are ________.
A) viable (creating value for the company and its
collaborators)
B) unique (unmatched by any other company)
C)
cutting-edge (using only the latest technologies and concepts)
D)
low cost (marketable using minimal resources)
E) buzz-worthy
(capable of generating broad media attention)
A
Designing and validating a prototype version of a potential offering occurs during the ________ stage of the stage-gate framework.
A) concept development
B) idea generation
C)
commercial deployment
D) offering development
E)
business-model design
A
The offering's target market, the value created by the offering in this market, and the key attributes of the offering are all defined in the ________ stage of the stage-gate framework.
A) concept development
B) idea generation
C)
commercial deployment
D) offering development
E)
business-model design
E
Making the case for how the company and its collaborators will benefit from launching the offering occurs in the ________ stage of the stage-gate framework.
A) concept development
B) idea generation
C)
business-model design
D) commercial deployment
E) offering development
C
Conducting a market test occurs in the ________ stage of the stage-gate framework.
A) offering implementation
B) idea generation
C)
business-model design
D) commercial deployment
E) offering development
A
When General Mills is finalizing the key attributes of a new cereal offering, including the brand name, price, incentives, communication, and distribution plan, it is in the ________ stage of the stage-gate framework.
A) offering implementation
B) idea generation
C)
business-model design
D) commercial deployment
E) offering development
C
When Apple released the third generation of the iPad Pro tablet, this was an example of which kind of innovation?
A) Supplemental innovation
B) Incremental
innovation
C) Disruptive innovation
D) New-market
innovation
E) Breakthrough innovation
B
Oreo Carrot Cake flavored cookies are an example of which kind of innovation?
A) Supplemental innovation
B) Disruptive innovation
C)
Incremental innovation
D) New-market innovation
E)
Breakthrough innovation
C
Which of these is NOT one of the characteristics of highly innovative companies?
A) A positive attitude toward innovation
B) A positive
attitude toward risk-taking
C) Strict boundaries on risk-taking
with appropriate negative consequence
D) A methodical approach
to generating, developing, and commercializing new offerings.
E)
An embrace of experimentation and acceptance of failure
C
The Keurig single-serving coffee pod represents what kind of innovation?
A) Supplemental innovation
B) New-to-the-world
innovation
C) Incremental innovation
D) New-market
innovation
E) Predicted innovation
B
What does the term "intrapreneur" suggest in terms of innovation development?
A) These employees are focused on internal innovation
only.
B) These non-employees are temporary brought inside as
consultants.
C) These employees take an entrepreneurial approach
within their companies.
D) These innovators work only with
like-minded people in the company.
E) These employees get a
profit cut of any products they help invent.
C
Which of these statements about the stage-gate framework is NOT true?
A) Typically, most ideas raised at the beginning of the process
do not survive to the commercialization stage.
B) The number of
potential offerings decreases as the company works through the
process.
C) The number of potential offerings increases as the
company works through the process.
D) The cost of moving a
potential offering through each stage increases as the process moves
forward.
E) The process doesn't always move in a strictly linear
flow from left to right; sometimes ideas are "kicked back"
to an earlier stage and reworked.
C
Which of these statements about the business-model design stage of the stage-gate model is true?
A) The validated business model is still only a plan, not a
market-ready offering.
B) The business model is validated based
primarily on how innovative the idea is.
C) Customer needs are
not considered during the business-model design stage.
D) This is
strictly a "business case" stage; the product concept hasn't
been development yet.
E) The business-model design stage produces
a fairly complete plan for bringing the new offering to market.
A
After developed product concepts are validated by assessing their technological feasibility and potential to fulfill an uncovered customer need, what is a company's next step toward commercialization?
A) Offering implementation
B) Idea generation
C)
Business-model design
D) Commercial deployment
E) Offering development
C
In addition to ensuring that new offerings are technologically feasible and financially viable for the company and its collaborators, the stage-gate framework aims to create offerings that are ________.
A) desirable (providing value for target customers)
B)
unique (unmatched by any other company)
C) cutting-edge (using
only the latest technologies and concepts)
D) low cost
(marketable using minimal resources)
E) buzz-worthy (capable of
generating broad media attention)
A
Which stages of the stage-gate framework typically require the greatest investment of company resources?
A) Idea generation and concept development
B) Concept
development and business-model design
C) Business-model design
and offering implementation
D) Offering implementation and
commercialization
E) Commercialization and test marketing
D
If Caterpillar is developing a new compact front-end loader for use on residential construction sites but determines that the product won't create enough value for the company or its distribution collaborators, which gate in the stage-gate framework stopped the project?
A) Idea validation
B) Concept validation
C)
Business-model validation
D) Offering validation
E) Test market
C
In the context of the stage-gate framework of product development, the product concept can be thought of as the ________ the company will offer to its target customers.
A) value proposition
B) product design
C) value
proposal
D) product idea
E) business model
A
A limited geographic introduction of a new offering, perhaps in just one city, designed to validate the offering and see how well the various elements will perform, is known as a ________.
A) regional market
B) sales simulation
C) focus
group
D) market test
E) business-model validation
D
New-to-the-world products are ________.
A) low-cost products designed to obtain an edge in highly
competitive markets
B) new product enhancements that supplement
established products
C) new versions of an existing product that
has been less successful
D) new products that create an entirely
new market
E) existing products that are targeted to new
geographical markets
D
Most new-product activities are devoted to ________.
A) changing the target markets
B) developing
new-to-the-world products
C) introducing backward
integration
D) improving existing products
E) changing the
existing market dynamics
D
Most established companies focus on ________ innovation when they aim to enter new markets by tweaking existing products, or they want to stay one step ahead in the market by using variations on a core product.
A) incremental
B) continuous
C) spontaneous
D)
radical
E) competitive
A
Identify a shortcoming of giving the responsibility to develop new products to the product managers of a company.
A) They would not be familiar with the industry
standards.
B) Product managers would not have an operational
focus.
C) Product managers are often focused on managing
existing lines.
D) They will find it difficult to gain support
from employees.
E) Product managers are less likely to use
participative management.
C
________ teams are cross-functional groups charged with developing a specific product or business.
A) Virtual
B) Venture
C) Fundamental
D)
Elemental
E) Transitory
B
Intercom Inc., together with its subsidiaries, primarily engages in the generation, transmission, and distribution of electric power in the United States. The company observes that its growth has stagnated over a period of two years. In an attempt to promote growth, it considers adding new features to the existing products and introducing a few new products. The company forms a committee consisting of three top executives, one of the production mangers, a few operational managers, and a representative of the HR department to develop new products. This team is called a(n) ________ team.
A) virtual
B) venture
C) fundamental
D)
elemental
E) transitory
B
A team formed at Intercom Inc. to develop new products conducts most of its meetings at informal locations away from office. These workplaces are called ________.
A) skunkworks
B) idea funnels
C) research
centers
D) stage-gate systems
E) contextual bases
A
A ________ divides the innovation process into stages with a checkpoint at the end of each stage.
A) reverse assumption analysis technique
B) skunkworks
system
C) stage-gate system
D) spiral development
process
E) new-product department technique
C
________ are informal workplaces, sometimes garages, where intrapreneurial teams attempt to develop new products.
A) Stage-gate systems
B) Skunkworks
C) Funnels
D)
Opportunity spaces
E) Research centers
B
During which of the following stages in new product development does the company develop a prototype that has the core functionality of the proposed offering?
A) Idea generation
B) Idea screening
C) Business
analysis
D) Concept development
E) Product development
D