College of Administrative and Financial Sciences
MGT325: Management of Technology
Deadline: 06/03/2020 @ 23:59
Course Name: Management of
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Academic Year: 2020-2021
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Course Learning Outcomes-Covered
Demonstrate the dynamics of technological innovation concepts in technologyintensive business enterprises. (Lo 1.1)
Weight: 5 Marks
Students are supposed to read the Opening Case of Chapter-3 ‘Innovation in
India: The Chotukool Project’ (Page Number-43) of their e-textbook. Based on
your understanding of the case and concepts studied until now answer the
following question in 300-500 words each.
1. What were the pros and cons of attempting to develop a refrigerator for India’s
rural poor? (1 marks)
2. What product and process innovations did the Chotukool entail? Would you
consider these incremental or radical? Architectural or Component Competence
enhancing or competence destroying? (1 marks)
3. Did the Chotukool pose a threat of disrupting the traditional refrigerator
market? Why or why not? (1 marks)
4. Is there anything you think Godrej should have done differently to penetrate the
market of rural poor families in India? (1 marks)
5. What other products might the lessons Godrej learned which chotukool apply to?
Note: It is mandatory to support each answer with at least two scholarly, peerreviewed journal.
All students are encouraged to use their own words.
Be three to five pages in length (1000-1500words), which does not include the title
page, abstract or required reference page, which are never a part of the content
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Use proper referencing (APA style) to reference, other styles will not be accepted.
Support your submission with course material concepts, principles, and theories from
the textbook and at least two scholarly, peer-reviewed journal articles unless the
assignment calls for more.
It is strongly encouraged that you submit all assignments into the safe assignment
Originality Check prior to submitting it to your instructor for grading and review the
grading rubric to understand how you will be graded for this assignment.
Pros and cons of innovation in the rural areas
Innovation in any term is a change that may not easy to introduced among the people especially in
the rural areas. The rural areas are not equipped with the living facilities like electricity and loving
standards of people are very low. The idea of making innovative refrigerator was little bit risky
Pros of innovation
It was an adorable innovation for the Indian rural areas because of its low cost. The objective
maximization objective may earn by expending consumer market for the product. The Indian rural
area is a big consumer market based on the stores so the market expansion was high for the
refrigerator. It was portable refrigerator and needs less space for the installation so it is better for the
rural area. Its unique and low risk strategy makes it better for the remote rural areas. The diffusion
among consumer has gain the competitive edge to the firm as they translate idea of making the better
life of rural area (Rothaermel, 2010).
Cons of innovation in the rural area
The innovation is always give way to the new routes and it is made for customer’s attention. The
innovations are advantageous for improving the life standard of people (Bloom, 2019). The Godrej
has made the refrigerator for the rural areas but it did not meet the actual expectation of the firm.
people of rural area in India are living under the poverty line as they are unable to manage their
livelihood the pricing of $50 was very expensive for them. People are habitual of living with the
difficulties and they did not accept the innovative change as happened in Indian rural area. The
customer’s response was not a much appreciated in that areas it shows that the segmentation was not
correctly done by the team. The objective of profit maximization was unable to achieve by
introducing innovative refrigeration in the Indian rural area as the people are much familiar with the
refrigerator as their living style did not match this innovation attempt. Although this was a low cost
innovation but still needs to have an expected return on investment and the firm was unable to gain
the profitable outcome of the innovation in the Indian area.
Product process of Chutkool for target market
Innovation is an ongoing process for any firm whether in distribution product pr introducing a
process. The product or process innovations are stated as the positive change for making customer
familiar with the new and advanced technology. Technology innovation brings positive change in the
life of targeted market (Kumar, 2018). In case of Chutkool the product innovation entails positive
factors for the life of people living under poverty line. They are unable to afford the traditional
refrigerator due to the financial and electricity hazards but eh low cost and low electricity factors of
the refrigerators are motivational and inspirational segments for the people. In addition to this, in
remote areas people instead of staying in the houses spend their time in farms so they can easily take
their refrigerator with them at the workplace and this is one the biggest factor for adapting the
technology innovation by rural people.
Incremental factors for the Chutkool
The incremental factors of any product are those factors that increase its demand in any targeted
market and improve the financial projection for meeting the profit maximization objectives. The
innovation is considered to be a positive factor for the firm. The technology innovation is
unpredictable still before the launch (Lennerts, 2020). The actual situation always portrayed after the
technology is installed among the targeted area. In the case of refrigerator innovation in rural Indian
areas firm face both outcomes negative as well as positive. The overall positive and incremental
aspects are more than the negative radical factors.
In my view the refrigerators entails are innovative for the firm and it is the incremental addition due
to the positive factors. In rural areas people are facing the main electricity issues due to w=that
traditional refrigerators are unable to perform and the main aim of people for keeping their product
fresh is not fulfilled. The Chutkool refrigerator designed to perform with low electricity and this is
the actual requirement of stores those facilitating the customer with the cold drinks. The other
incremental factor is the specialty of being remote and easily accessible at any point as the little
cooler. Moreover, the portable access to light is the best innovative aspect of this product.
The architectural competence is the ability of any product for functioning effectively with perfection.
Furthermore, the architectural competences increase the competitive edge for the firm. In case of the
refrigerator the innovative aspects are stated as the architectural competence although it is not
acceptable by the people due to financial discrepancies but the overall changes made by the team are
appreciating for increasing the life standards of the rural area’s people. It further increases the
consumer market for the firm as people in stores adopted this refrigerator due to architectural
components. This is the successful innovation for the firm and it is not unbeatable by the traditional
refrigerator makers. They are unable to compete this in the target market (Bouncken, 2018).
Effect of Chutkool on traditional refrigerator
Technology trajectory refers to the continuous changes in the technology market for increasing the
functional capability of any product. The new technology trajectories are done for better and
improved product innovation and it replaces the already penetrated product in the market or diverts
the consumer mind. The innovative products are highly demanded in the market. People love to go
for using the different and new product for their easiness. For instance the high voltage traditional
refrigerators are replaced by the low voltage converter refrigerators. The innovative process and
product design attracts the customer and mostly are of high demand. Technology trajectory is mostly
accepted by the people but it depends on the customer awareness. In case of Chutkool as per my
opinion did not pose threat for the traditional refrigerator (Kobarg, 2019).
The traditional refrigerator is unable to move anywhere and needs specific and high electricity for
functioning accurately. In opposing to this Chutkool is a converter that needs 120 volts for being
functional anywhere and it is portable. This is made for the limited target market of India and not for
the commercial uses. In my view it did not disrupt the refrigerator demand. The refrigerator is good
for the commercial use, store, flowers and hotels. The urban people those can bear the electricity bill
and have good electricity flow are able to use refrigerator and they are continually using it. The
portable refrigerators are mad for the rural areas so this did not affect the traditional refrigerator’s
market. This is the small and looks like a cooler and the traditional refrigerators are sophisticated in
look and gave a better look to the house especially in urban areas so they would refer the traditional
refrigerator as per their demand of living. Financial attributes makes the standards of living and this
is one of the main reason target urban people especially in the restaurants people need the
sophisticated traditional refrigerators.
Market penetration strategy
The market penetration is strategy that helps the firm to enter in the new market with different or
same product. The market penetration needs an in-depth analysis of price, demand, familiarity, living
standards and awareness about the advantages of any product that needs to be launched in the
market. It occurred in different ways for attracting customers and the best way is the promotional
efforts that created awareness among the people. This will acknowledged people about the
specification of any product and their advantage for improving their life. Pricing strategy helps the
firm in maintaining the image by declining the price of other product so many people can reach them
for purchasing (Tanusondjaja, 2018). Acquisition with competitors is another way of market
penetration that would be helpful for the Godrej for the customer attention. Market penetration is the
best source of acquiring the customer from the new or existing market (Chen, 2019).
The word of mouth is one of the best strategies that could be used by the Godrej but in case of
penetration in the rural market it is not as much effective. Godrej is a well known firm that already
has a name in overall Indian market. The firm has already used three different strategies but they are
ineffective to some extent. The word of mouth strategy has been used but the selection of hired
people was wrong. The firm needs to focus on local people those knew to create awareness among
the local people. The Godrej needs to use the pricing and product penetration with good promotional
efforts. The market price of refrigerator is very low so they need to facilitate the main store of
targeted rural area where the customer intensity is high. They need to facilitate the store with free
refrigerator initially for increasing the awareness. Some of the local people need to be hired for
changing mind map of the customer thinking about the new specification of the refrigerator. The
strategy of choosing local post office is not as much effective because not many people went there
for receiving the mails. The religious temples are the places that could be use for displaying the little
refrigerator. This investment would be of great importance for the firm. Furthermore, rethinking
about the pricing strategy is important for the firm because it has been analyzed that poor people
have no concerned with the color and size but the prices are the actual threat for the new product
entry in the rural area.
Others things to learn from Chutkool
Profit maximization and customer attraction are the two basic objectives of the firm for entering in
the new market. Firms entered in the rural market with new things but they need to understand first
about the relationship between profit maximization and the living standard of the people for those
technology innovation is portrayed (Agmon, 2021). It has been analyzed from the Chutkool
experience that firm has to focus on the living standards as they know but the wrongly estimate the
pricing. They need to learn that financial aspects are the main threat for any rural market they are
living in rural area because of less financial resources and they are unable to fulfill their daily needs.
Although the price of refrigerators was very low but still tit is an expensive product for the rural
people because they are unable to earn and they think the purchasing of refrigerator is a luxurious
Another thing that is lacking in the case is the estimation of demand and supply. The firm is lacking
in analyzing the demand of refrigerator in the rural area. Price, demand and supply has strong
relation with each other. The demand of refrigerator is very low in the rural area where loving
standard is not much higher or just average (Hamwi, 2021). They are happy without the luxurious
products and just focus on availing the products that are important for survival. The refrigerator is
not the product important for life as per them as they have alternatives for this. The accurate demand
estimation was highly lacking in the case.
Chutkool further needs to know that only lowering prices is not the way of entering in the new
market but the accurate market analysis is also required for being the product successful. They only
think that it is the rural market so the lowering prices would successfully functional bit they
underestimate the macroeconomic factors like employment and inflation. They ne to analyze the rate
of employment helps in analyzing that whether people have any motivation for improving their
Agmon, T. (2021). The new distributed digital technology world trade and MNEs: another step in the
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Bloom, N. V. (2019). A toolkit of policies to promote innovation. . Journal of Economic
Perspectives, , 33(3), 163-84.
Bouncken, R. B. (2018). Coopetition in new product development alliances: advantages and tensions
for incremental and radical innovation. British Journal of Management , 29(3), 391-410.
Chen, L. S. (2019). The international penetration of ibusiness firms: Network effects, liabilities of
outsidership and country clout. Journal of International Business Studies , 50(2), 172-192.
Hamwi, M. L. (2021). Demand response business model canvas: A tool for flexibility creation in the
electricity markets. Journal of Cleaner Production , 282, 124539.
Kobarg, S. S.-W. (2019). More is not always better: Effects of collaboration breadth and depth on
radical and incremental innovation performance at the project level. Research Policy , 48(1), 1-10.
Kumar, K. N. (2018). Virtual energy storage capacity estimation using ANN-based kWh modelling
of refrigerators. IET Smart Grid , 1(2), 31-39.
Lennerts, S. S. (2020). The asymmetric effects of exploitation and exploration on radical and
incremental innovation performance: An uneven affair. European Management Journal , 38(1), 121134.
Rothaermel, F. &. (2010). Innovation strategies combined. MIT Sloan Management Review , 51(3),
Sony, M. (2020). Pros and cons of implementing Industry 4.0 for the organizations: a review and
synthesis of evidence. Production & Manufacturing Research , 8(1), 244-272.
Tanusondjaja, A. N.-T. (2018). Portfolios: Patterns in brand penetration, market share, and hero
product variants. Journal of Retailing and Consumer Services, , 41, 211-217.
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