Chapter 3

1) What are some reasons that established firms might resist adopting a new
technology?
Some reasons that established firms may not adopt a new technology is because the firm may
be focused on improving their current technologies and may not realize that there are newer
devices being adopted. The firms may feel that the technology is too complex for them to take
the time and cost for them to learn it.
OR,

2) Are well-established firms or new entrants more likely to (a) develop and/or (b) adopt
new technologies? Why?

OR,
Course Hero
Chapter 4
1) What are some of the sources of increasing returns to adoption?
Chegg Solution:
Business circumstances are always uncertain. The market usually standardizes on certain
conditions. Industries are tending to go with increasing returns to adoption because the more a
technology is adopted, the more it becomes valuable. Furthermore, the more a technology is
implemented, the more it is improved.
OR,

2) What are some examples of industries not mentioned in the chapter that demonstrate
increasing returns to adoption?
Additional industries demonstrating increasing returns to adoption are typewriters with the
Qwerty keyboard and the adoption of VHS over Beta.
3) What are some of the ways a firm can try to increase the overall value of its
technology and its likelihood of becoming the dominant design?
A firm can try to increase the overall value of its technology by investing in research and
development and using innovation.

OR,
The overall value of the firm’s technology can be incremented by implementing needed
strategies. More the technology is consumed, the more revenue it returns to the organization.
To increase the overall value of their technology and to become the dominant design the idea
was provided below.
To survive in the innovative business world and to get the superior product standardization and
to dominate the market, the firm’s technology should have a huge installed base. The Main
focus of the organization should be to attract the consumers by increasing their installed base.
Developing complementary products or by encouraging other developers to create products for
their technology will enhance the performance of the firm. Complementary products will
enhance the technology more efficient and attract the consumer base. As the incremental
growth occurs on complementary products, the technology will catch the market and will be
the dominant design.
The firm has to penetrate the market by heavily increasing the awareness among consumers.
They must conduct eye catching advertisements by promoting their product to the exiting
market using various kinds of medias and marketing channels. And make revolutionary
awareness that their products have a great place in the market and the technology behind that
has a high demand and the firm has a huge installed base. Therefore, when market penetration
takes place more consumers will adopt the new technology and this will help the technology to
be the dominant.
It’s important to the firm to mainly focus on the technology which will be much compatible
with the complementary products which will be developed by other competitive firms.
Incompatibility of the complementary products will discourage the consumers from consuming
or adapting to technology. So the organization should always force and encourage the
expansion of the compatible complementary products to make their technology dominant.
By providing enhanced functioning products for the consumers with a reasonable price who is
highly adapting the technology the organization can increase the customer base. As there are
high range of competitors firms has to market their product with a price which the consumers
can afford easily. Therefore, the technology deliverable should be ensured by the firm as to the
customer expectations.
By implementing the above strategies, the installed base can be increased therefore the overall
value and likelihood of their technology will be the dominant design.
4) What determines whether an industry is likely to have one or a few dominant
designs?
Whether an industry will have one dominant design or a few is a function of the following: a.
The level of market share at which consumers get their network.
OR,
Whether an industry will have one dominant design or a few is a function of the following:
① The level of market share at which consumers get their network externality needs met • If
consumers network externality needs are met at low levels of market share, then more than
one dominant design may develop.
② Path dependency
③ Success of early entrants • Preventing challengers from gaining a foothold in the market
④ Sponsorship of a technology by a powerful firm • Helping the technology attain a controlling
share of the market that locks out alternative technologies
⑤ Government’s intervention to ensure that technologies are compatible for societal benefits
 5) Are dominant designs good for consumers? Competitors? Complementors? Suppliers?
– For consumers
• YES: If the benefits accrued by consumers through widespread adoption of a technology
outweighs the costs associated with a monopoly (e.g. higher prices, less product, variety, etc.)
• NO: If the benefits accrued do not outweigh the costs.
– For competitors
• Might be YES: If the technology is “open” (not protected by intellectual property rights) or
your firm is the owner of the technology that becomes the dominant design
• NO: Firms that do not have their technology adopted lose their investment in their technology
and also have to play catch up in order to compete with the firm that owns the dominant
design
– For complementors and suppliers
• YES: A single dominant design is likely to the market uncertainty they face and the eliminates
the cost of trying to support multiple competing technologies. Complementors can benefit from
the establishment of a dominant design by not wasting resources developing for other
platforms that do not thrive and from an expanded market for their products.
• NO: A single dominant design is likely to reduce their power as suppliers
Chapter 5

Chapter 6
Defining the Organization’s Strategic Direction
1) What is the difference between a strength, a competitive advantage, and a sustainable
competitive advantage?
Core competencies are complex and sophisticated “bundles” of capabilities, processes, systems,
and procedures that the organization has developed over time and which give it a unique ability
to achieve a competitive advantage in the marketplace.
OR,

2) What makes an ability (or set of abilities) a core competency?

3) Why is it necessary to perform an external and internal analysis before the firm can
identify its true core competencies?

4) Pick a company you are familiar with. Can you identify some of its core competencies?

5) How is the idea of “strategic intent” different from models of strategy that emphasize
achieving a fit between the firm’s strategies and its current strengths, weaknesses,
opportunities, and threats (SWOT)?

6) Can a strategic intent be too ambitious?