Which of the following statements about innovation is NOT true? O Successful innovation allows a firm to extract temporary monopoly profits. Process innovations are made possible through advances such as the Internet. O Innovation as a competitive weapon can simultaneously create and destroy value. Innovation has to be high-tech in order to be a potent competitive weapon.
Which of the following statements about innovation is NOT true? O Successful innovation allows a firm to extract temporary monopoly profits. Process innovations are made possible through advances such as the Internet. O Innovation as a competitive weapon can simultaneously create and destroy value. Innovation has to be high-tech in order to be a potent competitive weapon.
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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Transcribed Image Text:### Understanding Innovation: Identifying Misconceptions
**Question:**
Which of the following statements about innovation is NOT true?
- Successful innovation allows a firm to extract temporary monopoly profits.
- Process innovations are made possible through advances such as the Internet.
- Innovation as a competitive weapon can simultaneously create and destroy value.
- Innovation has to be high-tech in order to be a potent competitive weapon. *(This statement is highlighted as false)*
**Explanation:**
This multiple-choice question tests the understanding of innovation's role and its nature in business contexts. Among the options, the highlighted statement indicates a common misconception:
- **Innovation does not need to be high-tech to be effective.** Innovations can be organizational, process-based, or even simple product improvements that don't necessarily involve advanced technology. This is part of what makes innovation a versatile tool in competitive strategies.
In contrast, the other statements reflect correct aspects of innovation. Companies can achieve temporary monopoly profits by innovating successfully, and advances like the Internet have facilitated numerous process innovations. Moreover, innovation can simultaneously create value by offering new opportunities and destroy value by rendering old technologies or methods obsolete.
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