Chapter 01
The Strategic Elements of Product Development
True / False Questions
1.By definition, new products are limited to significant technological innovations.
FALSE
Feedback: Mention new products and people think about technology—iPhones, online shopping, smart watches, self-driving cars, virtual realities, and the like. But most new products are far simpler—low-carb colas, new movies, new singing stars, fast foods, and new flavors of frozen yogurt.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: Setting
2.New products can be tangible goods or services.
TRUE
Feedback: New products can be tangible goods or services. New products can be destined for the consumer market, the business-to-business market, or both.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: Setting
3.Radical innovation that displaces or obsoletes current products and creates totally new product categories is critical to the future growth and survival of a firm.
TRUE
Feedback: Many managers realize that radical innovation is critical to future growth and even the survival of a firm. Here, radical innovation is innovation that displaces or obsoletes current products and/or creates totally new product categories.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: The Importance of New Products
4.Business firms expect, and get, a high percentage of their sales and profits from new products.
TRUE
Feedback: A successful new product does more good for a firm than anything else. Best business firms not only have a higher percentage rate of successes, but also derive almost twice as many sales and profits from new products (defined as five years old or younger) than do the rest. Best firms are also more efficient in developing successful products.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Topic: The Importance of New Products
5.A firm's global presence is no guarantee that it will automatically know how to efficiently manage its global operations.
TRUE
Feedback: A firm's global presence is no guarantee that it will automatically know how to efficiently manage its global operations. Effectively coordinating and marshaling the efforts across multiple countries to develop and to launch successful new products is a major challenge.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Topic: Globalization and New Product Development
6.Firms with a global innovation culture have the most effective global new product programs.
TRUE
Feedback: Firms with a global innovation culture have the most effective global new product programs. Having a global innovation culture means that a firm is open to global markets, mindful of differences in customer needs and preferences, and respectful of different national cultural and business environments.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Topic: Globalization and New Product Development
7.An ideal new products team is essentially self-directed with limited or no cross-functionality.
FALSE
Feedback: An underlying principle of product development is teamwork. The new products team ideally is cross-functional, comprising personnel from marketing, R&D, engineering, manufacturing, production, design, and other functional areas as well.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: How Product Development is Different
8.The term "product innovation" usually applies to functions, especially those of manufacturing or distribution.
FALSE
Feedback: The term product innovation applies to the total operation by which a new product is created and marketed, and it includes innovation in all of the functional processes, while the term process innovation usually applies to functions, especially the manufacturing or distribution process, and every new product benefits from this type of innovation.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: How Product Development is Different
9.New-to-the-firm products revolutionize existing product categories or define wholly new ones.
FALSE
Feedback: New-to-the-world products revolutionize existing product categories or define wholly new ones. They are the most likely to require consumer learning and/or incorporate a very new technology. New-to-the-firm products are products that take a firm into a category new to it.
The Strategic Elements of Product Development
True / False Questions
1.By definition, new products are limited to significant technological innovations.
FALSE
Feedback: Mention new products and people think about technology—iPhones, online shopping, smart watches, self-driving cars, virtual realities, and the like. But most new products are far simpler—low-carb colas, new movies, new singing stars, fast foods, and new flavors of frozen yogurt.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: Setting
2.New products can be tangible goods or services.
TRUE
Feedback: New products can be tangible goods or services. New products can be destined for the consumer market, the business-to-business market, or both.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: Setting
3.Radical innovation that displaces or obsoletes current products and creates totally new product categories is critical to the future growth and survival of a firm.
TRUE
Feedback: Many managers realize that radical innovation is critical to future growth and even the survival of a firm. Here, radical innovation is innovation that displaces or obsoletes current products and/or creates totally new product categories.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: The Importance of New Products
4.Business firms expect, and get, a high percentage of their sales and profits from new products.
TRUE
Feedback: A successful new product does more good for a firm than anything else. Best business firms not only have a higher percentage rate of successes, but also derive almost twice as many sales and profits from new products (defined as five years old or younger) than do the rest. Best firms are also more efficient in developing successful products.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Topic: The Importance of New Products
5.A firm's global presence is no guarantee that it will automatically know how to efficiently manage its global operations.
TRUE
Feedback: A firm's global presence is no guarantee that it will automatically know how to efficiently manage its global operations. Effectively coordinating and marshaling the efforts across multiple countries to develop and to launch successful new products is a major challenge.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Topic: Globalization and New Product Development
6.Firms with a global innovation culture have the most effective global new product programs.
TRUE
Feedback: Firms with a global innovation culture have the most effective global new product programs. Having a global innovation culture means that a firm is open to global markets, mindful of differences in customer needs and preferences, and respectful of different national cultural and business environments.
AACSB: Analytic
Blooms: Remember
Difficulty: 1 Easy
Topic: Globalization and New Product Development
7.An ideal new products team is essentially self-directed with limited or no cross-functionality.
FALSE
Feedback: An underlying principle of product development is teamwork. The new products team ideally is cross-functional, comprising personnel from marketing, R&D, engineering, manufacturing, production, design, and other functional areas as well.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: How Product Development is Different
8.The term "product innovation" usually applies to functions, especially those of manufacturing or distribution.
FALSE
Feedback: The term product innovation applies to the total operation by which a new product is created and marketed, and it includes innovation in all of the functional processes, while the term process innovation usually applies to functions, especially the manufacturing or distribution process, and every new product benefits from this type of innovation.
AACSB: Analytic
Blooms: Understand
Difficulty: 2 Medium
Topic: How Product Development is Different
9.New-to-the-firm products revolutionize existing product categories or define wholly new ones.
FALSE
Feedback: New-to-the-world products revolutionize existing product categories or define wholly new ones. They are the most likely to require consumer learning and/or incorporate a very new technology. New-to-the-firm products are products that take a firm into a category new to it.