QUESTION 1. What are the two approaches governments use to define high-tech?

What are their strengths and weaknesses. Answers : High-tech means stylistic term applied to the expressive use of modern technology, industrial components, equipment or materials in the design of architecture, interiors and furnishings. There are two approaches governments use to define high-tech which is input-based definition and output-based definition.

The input-based definitions is based

on criteria such as the number of technical

employees, the amount of research and development (R&D) outlays or the number of patents field in a given industry. For example, U.S Bureau of Labor Statistic (BLS) classifies industries based on their proportion of scientists, engineers and technicians; firm that employ a high proportion of scientific, technical, and engineering personnel comprise high-tech industries. Similarly, the Organization for Economic Cooperation and Development and the National Science Foundation define high-tech in terms of the ratio of R&D expenditures to value added of a particular industry.

The output-based definitions is based on whether products embody new or leading edge technology. For example, the U.S Census Bureau identifies 10 major technology areas that produce such products biotechnology; life sciences technology; optoelectronic; information and communications technology (ICT); electronics; flexible manufacturing; advanced materials (semiconductors, fiber optics); aerospace; weapons; and nuclear technology. Similarly, the American Electronics Association uses the U.S governments NAICS (North American Industry Classification System) to classify 45 high-tech industries into three major output-based groupings; High-Tech Manufacturing, Communications Services, and Software and ComputerRelated Services.

Strengths and Weaknesses of Government Approaches to Defining High Technology Input-Based Approaches Strengths : Data are generally easily obtainable. Classification is objective. Correlation between input-based classification is reasonably high for level 1* industries. Data on the high-tech service sector is included.

Weaknesses : Because thresholds for high levels are not obvious, classifications may be deemed somewhat arbitrary. Classifications may include industries with products not commonly thought of as hightech. Classifications may omit very new industries (e.g. biotechnology and nanotechnology not on the list of high-tech industries) Different input-based measures will result in different classifications.

Output-based Approaches Strengths : Classification tends to have face value (industries matches popular conception) Relatively good correlation exists between input and output methods for Level 1 industries. Weaknesses : Somewhat post-hoc: Judgments are somewhat subjective. Output-based approaches are generally not as comprehensive as input-based approaches. Relatively low correlation exists between input output methods for level 2 and level 3 industries.
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2. What are the three characteristics common to high-tech environments? Answers : The three of characteristics common to high-tech environments are market uncertainty, technology uncertainty and competitive volatility. Here are the explanations of each characteristic. Market uncertainty Market uncertainty refers to ambiguity about the type and extent of customer needs that can be satisfied by a particular technology, and arises from five sources. First, market uncertainty arises from consumer fear, uncertainty, and doubt about what needs or problems the new technology will address, as well as how well it will meet those needs. Second, customers needs often change rapidly, and in an unpredictable fashion, in high-tech environments. Third, customer anxiety is perpetuated by competing an incompatible technological standards for new products. A fourth factor, due in large part to the prior three factors, is uncertainty among both consumers and manufacturers over how fast the innovation will spread. In many cases, the market for high-tech innovations is slower to materialize than most would predict. The fifth, related to the uncertainty over speed of adoption, is the inability for manufacturers to estimate the size of the market. Technology uncertainty Technology uncertainty is not knowing whether the technology or the company providing it can deliver on its promise to meet specific needs. Five factors give rise to technological uncertainty. First, comes from question whether the new innovation will function as promised. Second, relates to the timetable for development (and subsequent market availability) of the new product. In high-tech industries, product development commonly takes longer than expected, causing headaches for both buyers and sellers. Third, arises from concerns about the supplier of the new technology. Fourth, the very real concern over unanticipated consequences or side effects also creates technological uncertainty. Finally, the fifth is technological uncertainty exists because one is never certain just how long the technology will be viable before an even newer development makes it obsolete.

Competitive volatility Competitive volatility refers to both intensity in degree of change in the competitive

landscape and uncertainty about competitors and their strategies. Competitive volatility has three dimensions; firms experience uncertainty about who their competitors are, their competitors market strategies, and their competitors product offerings.

3. What is blue ocean strategy? Answers : Blue ocean strategy is a strategy that creates a new market space by serving customers whose needs are not met by current products or by serving previously unidentified customer segments. The term market space refers to the markets or product arena in which a firm competes, and new market space represents potential those who might be customers.

4. What are core competencies? Give examples of a firm core competencies. Answers : A core competencies is defined as something unique that an organization has, or as something unique it can do. A company that develops a unique core competency can create long lasting competitive advantage. A core competencies will typically meet all rules on the following; it provides benefit to the customer; difficult to imitate; can be leveraged widely to create many products (or operate in many markets); it will uniquely identify the organization; difficult to pin down, because it seems to be a combination of things such as technology, process, and know-how. Core competencies is the underlying skills and capabilities that give rise to a firms source of competitive advantage; often based in hard-to-imitate embedded knowledge. Core competencies exhibit three characteristics: difficult for competitor to imitate, significantly related to the benefits customers seek and firm can access a wide variety of disparate market opportunities by applying its skills and competencies in product markets where it has not previously competed.

For example, Hewlett-Packards core competencies is in the part of transferring digital images to paper with superior clarity, detail, and color. This core competencies was exhibited in its resounding success in the laser printer business. Although other companies also made laser printers, HPs superior technology and production skills made the high quality very difficult to imitate. Besides, the skill transferring digital images to paper in a high quality approach was significantly related to the benefits customers were seeking in printing their computer images. Hewlett-Packard leveraged this core competency into a very different market. It entered the digital photography business with a digital photography package consisting of a camera, scanner and printer. Moreover, HPs technology that propels tiny droplets in inkjet printin g is now being used to inkjet medicine into the skin with a patch.