1. Define the concept of Strategic Analysis.
It is the process of conducting research on the business environment within which an
organization operates and on the organization itself, in order to formulate strategy.
Definitions of strategic analysis often differ, but the following attributes are commonly associated
with it:
a. Identification and evaluation of data relevant to strategy formulation.
b. Definition of the external and internal environment to be analyzed.
c. A range of analytical methods that can be employed in the analysis.
2. Discuss the Strategic Management Process.
Strategic Management can be defined as the art and science of formulating, implementing, and
evaluating cross-functional decisions that enable an organization to achieve its objectives.
Strategic Management Process consists of three stages:
a. Strategy Formulation
- Includes developing a vision and mission, identifying an organization’s external
opportunities and threats, determining internal strengths and weaknesses,
establishing long term objectives, generating alternative strategies and choosing
particular strategies to pursue.
b. Strategy Implementation
- Requires a firm to establish annual objectives, devise policies, motivate
employees, and allocate resources so that formulated strategies can be
executed.
c. Strategy Evaluation
- This is the primary means for obtaining information as to what particular
strategies are not working well
Strategy formulation, implementation, and evaluation activities occur at three hierarchical levels
in a large organization: corporate, divisional or strategic business unit, and functional.
3. Differentiate Vision and Mission statements in relation to strategic planning.
Vision statement answer the question “What do we want to become?” It is considered the first
step in strategic planning, preceding even development of a mission statement. While mission
statement are enduring statements of purpose that distinguish one business from other similar
firms. It identifies the scope of a firm’s operations in product and market terms. A clear mission
statement describes the values and priorities of an organization and why it existed in the first
place.
4. Explain the major benefits of strategic management to a Firm.
Research studies now indicate that the process, rather than the decision or document, is the
more important contribution of strategic management. Communication is a key to successful
strategic management. Through involvement in the process, in other words, through dialogue
and participation, managers and employees become committed to supporting the organization.
5. Explain at least five Strategic Tools being used in strategic management.
Strategic Tools Keywords/Ideas Remarks
SWOT Analysis Identify the internal and Strength and Weakness -
external factors that are internal to the organization
important to achieving the
objective of the activity or Opportunities and Threats -
business. external to the organization
PEST Analysis Scan of the external macro- It is often useful to complete
environment. a PEST analysis before
completing a SWOT Analysis.
Can be used for evaluating
market growth or decline, and
as such the position, potential
and direction for a business.
Porter’s Five Forces There are five forces which Often use to understand
determine the competitive whether new products or
intensity and attractiveness of services are potentially
a market. profitable.
Four corner’s analysis Useful tool for analyzing *generating insights into the
competitors future
**DCMC
Value Chain Analysis Useful for understanding how *IOMOS
activities within the
organization create value for
customers.
6. Discuss (or differentiate) Technological Foresight and Forecasting.
Technological Forecasting (TF) is concerned with the investigation of new trends, radically
new technologies, and new forces which could arise from the interplay of factors such as new
public concerns, national policies and scientific discoveries. Many of these forces are beyond
the control, influence and knowledge of individual companies.
Exploratory Techniques Normative Techniques
(Analysis of Historical Data) (Proposing a desired or possible state, then
work backwards)
S-Curves Relevance Trees
Cycles Morphological Analysis
Trend Extrapolation Technology Watch/Monitoring
Technology Substitution Delphi Analysis
Trend Impact Analysis
Technology Substitution
Technological Foresight is a combination of creative thinking, expert views and alternative
scenarios to make a contribution to strategic planning (intuitive thinking).
Source: http://www.innovation-portal.info/toolkits/technological-forecasting/
7. Explain/describe/discuss the relation between technology and innovation. How
can this relationship guide the process of technology foresight? Cite an instance
where this relationship was useful or can be used to further create scenarios or
technology roadmaps.
Technology is a powerful driver of both the evolution and proliferation of innovation.
Key Points
● Innovation is a primary source of competitive advantage for companies in
essentially all industries and environments and drives efficiency, productivity,
and differentiation to fill a higher variety of needs.
● Technology builds upon itself, enabling innovative approaches within the
evolution of technology.
● Technological hubs such as California’s Silicon Valley provide powerful
resources that entrepreneurs and businesses can leverage in pursuing
innovation.
● Technological advances, particularly in communication and transportation,
further innovation.
● India, China, and the United States are all strong representations of how
embracing technology leads to innovation, which in turn leads to economic
growth.
Technological Foresight is a combination of creative thinking, expert views and alternative
scenarios to make a contribution to strategic planning (intuitive thinking).
Source: https://courses.lumenlearning.com/boundless-management/chapter/technology-and-
innovation/
8. DIscuss the Technology Life Cycle
The technology life cycle describes the costs and profits of a product from technological
development to market maturity to decline.
Key Points
● The technology life cycle seeks to predict the adoption, acceptance, and
eventual decline of new technological innovations.
● Understanding and effectively estimating technology life cycle allows for a more
accurate reading of whether and when research and development costs will be
offset by profits.
● The technology life cycle has four distinct stages: research and development,
ascent, maturity, and decline.
● The adoption of these technologies also has a life cycle with five chronological
demographics: innovators, early adopters, early majority, late majority, and
laggards.
● By leveraging these models, businesses and institutions can exercise some
foresight in ascertaining return on investment as their technologies mature.
The technology life cycle (TLC) describes the costs and profits of a product from
technological development phase to market maturity to eventual decline. Research and
development (R&D) costs must be offset by profits once a product comes to market.
Varying product lifespans mean that businesses must understand and accurately
project returns on their R&D investments based on potential product longevity in the
market.
Due to rapidly increasing rates of innovation, products such as electronics and
pharmaceuticals in particular are vulnerable to shorter life cycles (when considered
against such benchmarks as steel or paper). Thus TLC is focused primarily on the time
and cost of development as it relates to the projected profits. TLC can be described as
having four distinct stages:
●
Research and Development – During this stage, risks are taken to invest in
technological innovations. By strategically directing R&D towards the
most promising projects, companies and research institutions slowly work
their way toward beta versions of new technologies.
● Ascent Phase – This phase covers the timeframe from product invention
to the point at which out-of-pocket costs are fully recovered. At this
junction the goal is to see to the rapid growth and distribution of the
invention and leverage the competitive advantage of having the newest
and most effective product.
● Maturity Stage – As the new innovation becomes accepted by the
general population and competitors enter the market, supply begins to
outstrip demand. During this stage, returns begin to slow as the concept
becomes normalized.
● Decline (or Decay) Phase – The final phase is when the utility and
potential value to be captured in producing and selling the product begins
dipping. This decline eventually reaches the point of a zero-sum game,
where margins are no longer procured.
Source: https://courses.lumenlearning.com/boundless-management/chapter/technology-and-
innovation/
9. Explain/describe/discuss the Technology Adoption Life Cycle.
Product development and capitalizing on the new invention covers the business side of
these R&D investments in technology. The other important consideration is the
differentiation in consumer adoption of new technological innovations. These have also
been distributed into phases which effectively summarize the demographic groups
presented during each stage of TLC:
● Innovators – These are risk-oriented, leading-edge minded individuals
who are extremely interested in technological developments (often within
a particular industry). Innovators are a fractional segment of the overall
consumer population.
● Early Adopters – A larger but still relatively small demographic, these
individuals are generally risk-oriented and highly adaptable to new
technology. Early adopters follow the innovators in embracing new
products, and tend to be young and well-educated.
● Early Majority – Much larger and more careful than the previous two
groups, the early majority are open to new ideas but generally wait to see
how they are received before investing.
● Late Majority – Slightly conservative and risk-averse, the late majority is
a large group of potential customers who need convincing before
investing in something new.
● Laggards – Extremely frugal, conservative, and often technology-averse,
laggards are a small population of usually older and uneducated
individuals who avoid risks and only invest in new ideas once they are
extremely well-established.
Source: https://courses.lumenlearning.com/boundless-management/chapter/technology-and-
innovation/
10. Explain or discuss the Technology S-curve and give examples.
A technology’s performance evolves slowly in the beginning. At some point, a breakthrough
happens and it now improves rapidly. Limits of what is scientifically possible are reached and
performance doesn’t increase much more.
As technology reaches its mature stage, it becomes increasingly vulnerable to substitute
technologies. The initially lower performance makes it seemingly irrational for firms dominating
the previous technology to invest at early point. As performance then improves rapidly there is a
considerable risk that these firms are left behind.
The Technology S-curve is a powerful tool that can be used in order to explain how
technologies evolve and displace each other.
Source: https://www.slideshare.net/Christiansandstrom/technology-s-curves
11. Explain Creative Destruction (basis: Technology S-curve).
According to Schumpeter, innovation causes market dislocations, which allow the ascendance
of new firms and the corresponding decline of the large incumbent firms whose leadership
positions they assume.This occurs through the introduction of:
a. New Commodity;
b. New Technology;
c. New Source of Supply; and
d. New type of organization (the largest-scale unit of control for instance).
Competition which commands a decisive cost or quality advantage and which strikes not at the
margins of the profits and the output of the existing firms but at their foundations and their very
lives.
This is fundamentally different from general equilibrium theory, where the competition is almost
exclusively price-based. In Schumpeter’s view, competition is not to be based solely on price
but rather is based largely on non-price characteristics of a product such as capabilities and
performance - shifting the basis of competition from the ability to minimize cost to the ability to
innovate.
12. Cite industries, technologies, or services that are affected or in danger because of
creative destruction.
Possible Answer #1
Presently, there are a number of industries that have been on the decline from the effects of
creative destruction. For example, streaming services like Netflix, (NFLX), Amazon (AMZN) and
Hulu have negatively affected brick-and-mortar movie and gaming rental stores, as evidenced
by massive store closings. Additionally, the low cost of these services is even causing
consumers to reconsider the high costs of cable.
Possible Answer #2
Data recovery services will also continue to take a hit as cloud-computing services are seeing
appreciable growth. Recordable media like CDs and DVDs will also fall victim to digital and
streaming services as storage space and accessibility via mobile devices is superior.
Possible Answer #3
Digital photography and film have also harmed photography lab services, including development
and restoration, as demand for physical film is declining.
Possible Answer #4
Even more concerning is the emergence of 3D printing and its potential influence on various
manufacturing industries. WIth the ability to print objects or machines that would normally be
produced on an assembly line, this may have a massive impact on employment in particular
manufacturing industries.
Source: https://www.investopedia.com/articles/investing/070715/insights-creative-destruction-
and-technology.asp
13. Differentiate radical innovation and incremental innovation.
A radical or disruptive innovation is an innovation that has a significant impact on a market
and on the economic activity of firms in that market. This concept focuses on the impact of
innovations as opposed to their novelty. The innovation could, for example, change the structure
of the market, create new markets or render existing products obsolete. However, it might not
be apparent that an innovation is disruptive until long after it has been introduced, and the cut-
off point between incremental and radical innovation might be set at different levels. This makes
it difficult to collect data on disruptive innovations within the period reviewed in an innovation
survey, typically two years.
Incremental innovation concerns an existing product, service, process, organization or method
whose performance has been significantly enhanced or upgraded. This can take two forms: For
example, a simple product may be improved (in terms of improved performance or lower cost)
through use of higher performance components or materials, or a complex product comprising a
number of integrated technical subsystems may be improved by partial changes to one of the
subsystems.
In Schumpeter’s view “radical” innovations create major disruptive changes, whereas
“incremental” innovations continuously advance the process of change (Schumpeter, 1942).
Source: https://www.innovationpolicyplatform.org/content/radical-and-incremental-innovation
14. How important are radical and incremental innovation?
Incremental innovation most prevalent. Incremental innovation is the dominant form of
innovation. Radical innovation is generally a complex process, rather than a discrete event, and
generally implies a difficult, lengthy and risky process. Smaller firms, or new market entrants,
can play important roles in introducing radical innovations.
The diffusion of radical innovations nearly always depends on incremental improvements,
refinements and modifications, the development of complementary technologies, and
organisational change and social learning. The contributions of incremental innovations to
address socioeconomic challenges are substantial and may be even more important in a
development context.
For instance, Puga and Trefler (2010) provide evidence of the rise of incremental innovation in
low-wage countries and show how it has been contributing to increasing exports of high-quality
and sophisticated manufactured goods.
Source: https://www.innovationpolicyplatform.org/content/radical-and-incremental-innovation
15. Explain or discuss the interplay between innovation and the following:
a. high-tech sectors
b. low and medium-technology industries
Innovation differs by sector. Yet, the nature of innovation and the rate of technological change
greatly differ from sector to sector. Some sectors are characterised by rapid change and radical
innovations, others by smaller, incremental changes.
In high-technology sectors, R&D plays a central role in innovation activities, while other sectors
rely to a greater degree on the adoption of existing knowledge and technology. Low- and
medium-technology industries (LMTs) are often generally characterised by incremental
innovation and adoption.
As such, innovation activities are often focused on production efficiency, product differentiation
and marketing (Von Tunzelmann and Acha, 2005). Innovation activity in services also tends to
be a continuous process, comprising a series of incremental changes in products and
processes. This may occasionally complicate the identification of innovations in services in
terms of single events, i.e. as the implementation of a significant change in products, processes
or other methods.
Source: https://www.innovationpolicyplatform.org/content/radical-and-incremental-innovation
16. What are the policy implications of the distinction between radical and
incremental innovations?
Because innovations are of different types, occur in many different ways, and have varying
effects, they call for different policy responses. For example, research has found that
policies that address the tail-end of the product innovation cycle and encourage demand for
innovation are more likely to stimulate incremental innovation than to foster radical
innovation (Nemet, 2009). By contrast, publicly funded research has often been found to be
critical prior to the introduction of many of the radical innovations of the past. The latter is
better induced through technology- (or supply)- push policies (OECD, 2009).
17. Ckbslkcbschbs
18. Dc skjb kschs
19. Lcc s
20.
21. sdfasscsd
