Week 4 Flashcards
(23 cards)
According to the ‘Innovation Killers’ article, what financial analysis mistake led US Steel (USX) to favor using existing plants over building new minimills?
A) They focused on marginal costs rather than full costs for new capabilities
When evaluating innovation investments using DCF (Discounted Cash Flow), what critical error do companies make about the ‘do nothing’ scenario?
B) They assume their financial health will continue unchanged if they don’t invest
How were employees using GenAI at your co-op placement?
User-specific answer (A-D) based on their experience
According to the post ‘GenAI vs the Remote VAs’, what is the author’s main premise for testing GenAI capabilities?
A) Using Tim Ferriss’s ‘4-Hour Work Week’ tasks for remote VAs as a benchmark to evaluate GenAI
According to the post ‘GenAI vs the Remote VAs’, what happened when a lawyer used ChatGPT for legal research?
B) The lawyer submitted a brief with fictional legal cases that were generated by the AI system
How much is US Steel worth today?
B) Between $10 and 20 Billion
How much is Nucor worth today?
C) More than $20 Billion
What is the Innovator’s Dilemma faced by US Steel according to Christensen?
US Steel understood the disruptive threat of minimills but failed to invest due to financial models biased by sunk costs, marginal cost thinking, and DCF traps.
What are the two main DCF (Discounted Cash Flow) problems identified by Christensen?
1) Baseline assumption that status quo cash flows will continue. 2) Underestimation of cash flows from disruptive investments.
What is RPV and how does it relate to innovation?
RPV stands for Resources, Processes, and Values. It determines how an organization allocates resources — favoring sustaining innovation over disruptive innovation.
How did minimills disrupt the steel industry?
They entered the market with low-end products (e.g., rebar) at lower costs and gradually moved upmarket, forcing integrated steel mills to abandon segments as prices collapsed.
Why did US Steel hesitate to invest $260 million in minimills?
Because of marginal cost thinking and a belief in ‘business as usual’ — they failed to see they were already being disrupted.
What does GenAI amplify according to the slides?
GenAI provides language and task amplification — turning short prompts into long-form outputs like memos, emails, and content drafts.
What was the analogy between GenAI and digital photography?
Just like digital photography disrupted film with speed, efficiency, and accessibility, GenAI is poised to disrupt content creation with similar transformative potential.
What did the ‘4-Hour Work Week’ reference imply for evaluating GenAI?
It served as a benchmark to test whether GenAI can replicate tasks traditionally outsourced to human virtual assistants (VAs).
What tasks did GenAI succeed in during the Remote VA experiment?
Tasks like writing reminders, children’s guides, tourism board emails — tasks that rely on language generation but not physical interaction.
What kinds of tasks did GenAI fail in during the Remote VA test?
Tasks involving logistics or physical actions, like ordering bins or dealing with interpersonal nuance, where human presence is still essential.
According to the ‘Innovation Killers’ article, what fundamental error do managers often make when evaluating innovation?
They assume the present health of the company will persist indefinitely in the do-nothing scenario.
What is the primary flaw in how fixed and sunk costs are considered when evaluating future investments?
The focus on marginal costs biases managers toward leveraging existing assets that may become obsolete.
What risk is illustrated by the courtroom case involving Steven A. Schwartz and ChatGPT?
The risk of depending solely on AI for research without verification.
What is a key strength of Generative AI according to the article?
Its capacity to generate asymmetric output from limited input.
When applying Tim Ferriss’s productivity principles to Generative AI, what should be done first?
Assess if tasks should exist before assigning them to AI.
What is the primary purpose of Task Amplification Categories (TACs) in a professional setting?
To identify which tasks can best leverage GenAI.
