Innovation & Growth Strategy Flashcards

A company shifts from selling a product outright to charging customers a recurring subscription fee. This is an example of which type of innovation?

Answer: Business model innovation

Business model innovation changes how a company creates, delivers, or captures value—subscription pricing alters the revenue model without necessarily changing the product itself.

Which strategic analysis tool maps a company's unique activities to show how they create a defensible competitive position through interdependencies?

Answer: Activity system map

Porter's activity system map visualizes how a firm's unique set of interlocking activities reinforce each other, making the strategy difficult for competitors to replicate.

In the context of technology S-curves, what typically signals that a technology is approaching its performance limit?

Answer: Increasing R&D spending with diminishing performance gains

As a technology matures, more R&D investment produces progressively smaller performance improvements—a sign the S-curve is flattening and a new paradigm may be needed.

Which growth lever involves partnering with external companies to co-develop products, share distribution, or access complementary capabilities?

Answer: Strategic alliance or partnership

Strategic alliances allow firms to grow by combining complementary strengths without the full cost and risk of mergers and acquisitions.

A company discovers that its core product is being used in an unexpected way by a small group of customers, revealing a potential new market. This is best described as:

Answer: Lead user insight

Lead users—identified by Eric von Hippel—face needs ahead of the general market and often innovate solutions themselves, signaling nascent market opportunities.

The 'innovate or die' pressure from digital disruption is best countered at the strategic level by:

Answer: Building a portfolio of innovation bets across multiple time horizons

A portfolio approach across horizons ensures a firm maintains current revenues while seeding future growth, reducing the existential risk of single-bet innovation.

Which acquisition rationale is most aligned with an innovation growth strategy seeking to accelerate entry into an emerging technology space?

Answer: Capability acquisition to access proprietary technology or talent

Capability acquisitions target companies for their intellectual property, engineering talent, or proprietary platforms rather than for cost savings or market share.