CPI Innovation Strategy & Implementation 2 — Questions and Answers
Question 1: Which portfolio management approach balances incremental improvements with breakthrough innovations in an organization's innovation strategy?
- All-in radical innovation
- The 70-20-10 innovation portfolio model (Correct answer)
- Focusing exclusively on core business improvements
- Outsourcing all innovation to startups
Correct answer: The 70-20-10 innovation portfolio model
The 70-20-10 model allocates roughly 70% to core improvements, 20% to adjacent opportunities, and 10% to transformational bets, balancing risk and growth.
Question 2: What is the primary purpose of an innovation thesis in a corporate innovation strategy?
- To document past innovation failures
- To articulate where and why the organization will place innovation bets (Correct answer)
- To assign patent ownership across departments
- To schedule quarterly R&D budget reviews
Correct answer: To articulate where and why the organization will place innovation bets
An innovation thesis defines the strategic logic, opportunity spaces, and criteria guiding which innovation bets an organization will pursue.
Question 3: When executing an open innovation strategy, what is the key risk organizations must manage?
- Generating too many internal ideas
- Protecting core IP while leveraging external knowledge (Correct answer)
- Hiring too many external consultants
- Avoiding collaboration with universities
Correct answer: Protecting core IP while leveraging external knowledge
Open innovation exposes proprietary knowledge to external partners, so robust IP agreements and clear boundary-setting are essential risk controls.
Question 4: In the context of innovation implementation, what does 'minimum viable product' (MVP) primarily help organizations achieve?
- Final product launch readiness
- Early market learning with minimal resource investment (Correct answer)
- Complete feature set validation
- Regulatory compliance testing
Correct answer: Early market learning with minimal resource investment
An MVP is designed to test core assumptions with real users at low cost before committing to full-scale development.
Question 5: Which innovation governance structure gives business units the most autonomy while maintaining strategic alignment?
- Centralized innovation lab with sole authority
- Federated model with a central coordinating function (Correct answer)
- Ad hoc grass-roots innovation with no central oversight
- Mandatory top-down innovation mandates only
Correct answer: Federated model with a central coordinating function
A federated model distributes innovation activity across units while a central function ensures strategic coherence, shared resources, and knowledge transfer.
Question 6: What does 'horizon planning' in innovation strategy primarily address?
- Daily task scheduling for innovation teams
- Mapping innovations across short-, mid-, and long-term time frames (Correct answer)
- Forecasting exact product launch dates
- Measuring customer satisfaction scores
Correct answer: Mapping innovations across short-, mid-, and long-term time frames
Horizon planning (H1/H2/H3) categorizes innovations by time-to-impact so leaders can invest across near-term, emerging, and future opportunities simultaneously.
Question 7: Which metric is most appropriate for measuring the health of an organization's innovation pipeline?
- Number of patents filed annually
- Ratio of ideas entering versus successfully commercialized (Correct answer)
- Employee satisfaction scores
- Total R&D headcount
Correct answer: Ratio of ideas entering versus successfully commercialized
Pipeline conversion rate (ideas-in to commercialized-out) reveals funnel efficiency and where ideas are lost, making it a key health indicator.
CPI Innovation Strategy & Implementation 2
Which portfolio management approach balances incremental improvements with breakthrough innovations in an organization's innovation strategy?