CME Innovation & Entrepreneurship Flashcards

Which framework asks managers to evaluate strategy along four actions: Eliminate, Reduce, Raise, and Create?

Answer: Blue Ocean Strategy's ERRC Grid

The ERRC (Eliminate-Reduce-Raise-Create) Grid is central to Blue Ocean Strategy, helping organizations reconstruct market boundaries and create uncontested market space.

What is 'open innovation,' as described by Henry Chesbrough?

Answer: Using external and internal ideas and paths to market to advance technology

Open innovation is a paradigm where firms use external ideas alongside internal R&D, and can also monetize internal ideas externally through licensing or spin-offs.

In technology adoption, the 'chasm' in Geoffrey Moore's model refers to the difficulty of moving from:

Answer: Early Adopters to the Early Majority

Moore's chasm describes the critical gap between visionary early adopters and pragmatic early majority buyers, which many tech products fail to cross.

Which approach to entrepreneurship emphasizes using available resources and co-creating with stakeholders rather than predicting future outcomes?

Answer: Effectuation

Effectuation, developed by Saras Sarasvathy, describes how expert entrepreneurs start with available means and shape goals based on who they are and who they know.

A company decides to license its technology to other firms rather than developing products internally. This is an example of which innovation strategy?

Answer: Outbound Open Innovation

Outbound open innovation involves sharing or licensing internal knowledge to external parties, generating revenue from IP that might otherwise sit unused.

What is the key difference between invention and innovation in a managerial context?

Answer: Invention creates something new; innovation successfully commercializes or applies it to create value

Invention is the creation of a novel idea or product, while innovation requires successfully implementing or commercializing that invention to deliver economic or social value.