Question

In case of emergence of a disruptive technology, established companies should: a. reduce costs on research and development activities. b. acquire newly emerging companies that are pioneering potentially disruptive technologies. c. avoid commercializing new technologies. d. avoid investing in newly emerging technologies that may ultimately become disruptive technologies. e. ask customers "Are you interested in this new technology?"

Answer 1

Answer:

B. acquire newly emerging companies that are pioneering potentially disruptive technologies.

Explanation:

This is a long-term plan, since the company in question is already established, it would be a wise decision to target an emerging company that has the potential it seeks and purchase. Overtime, it's potential will yield fruit and would fit in for what it was originally targeted for. This is better as compared to purchasing an existing company with existing disruptive technologies, the cost impact will be extreme and will bring huge loss to the company

Answer 2

Answer:

The correct answer is letter "B": acquire newly emerging companies that are pioneering potentially disruptive technologies.

Explanation:

Disruption is the process whereby new technology or new product types invalidate their predecessors thus creating new businesses. The idea of disruption comes from the term creative destruction. Examples of disruptive technologies are the television, the development of computers and the turn of cell phones into smartphones.

In front of the rise of disruptive technology, it is convenient for large entities affected by the technology to acquire the newly emerging, disruptive companies in an attempt to keep their businesses up and running otherwise they are at risk of being replaced.