Submit a paper copy of your responses to Professor’s mailbox in Ballantine Hall 744 and an
electronic copy to the course website. To format your responses, use Times New Roman, font
size 12, double space, and one-inch margins all around.
The exam is take-home and open-book. You need to complete the exam independently — the
writing, wording, and ideas need to be your own. You are NOT allowed to work on the final
exam with others. When citing external information, please list the full reference in the
bibliography. For citing readings from the class, you can just list the author and year published.
This exam has two parts. Each is worth 50 points and requires a response of 1,000 words in total.

– 2 –
Part I. Short Questions (50 points)
(200 words and 10 points for each question)
1. You are consulted by Indiana University to design strategies that will enhance the
innovativeness of the undergraduate students. List three patterns you observe among the
friendships of the students. For example, who are the popular students? Do students tend to
associate with others who are similar to them? How does social media like Facebook change
the ways students interact? How can social networks affect innovations? From the network
point of view, what concrete steps will you suggest for IU to take in order to make students
become more innovative? [Hint: See slides and readings on “Social Networks and Social
Capital” and “Innovation and Diffusion”.]
2. Explain the strength of weak state. How does it affect diversity programs? [Hint: See slides
on “Diversity and Equality”.]
3. What does imprinting mean in Marquis (2003) and in general? What implications does
imprinting have on organizational design? [Hint: See slides and readings on “Imprinting”.]
4. Use examples to elaborate the ideas related to ecology and niche and the 70-20-10 rule?
[Hint: See slides and readings on “Niche” and “Innovation and Diffusion”.]
5. What is isomorphism? Use examples to elaborate the three mechanisms of isomorphism.
[Hint: See slides and readings on “Isomorphism”]

– 3 –
Part II. Case Analysis on Close Competitions (50 points)
Many competitions are close competitions. Here are a few examples.
 Business: Fujifilm vs. Kodak, Pepsi vs. Coca-Cola, Toyota vs. Ford vs. GM;
 Presidential elections: John Adams vs. Thomas Jefferson in 1796, Rutherford Hayes vs.
Samuel Tilden in 1876, Kennedy vs. Nixon in 1960, Al Gore vs. GW Bush in 2000;
 Sports: Lakers vs. Celtics in the 1980s, and Red Sox vs. Yankees;
 States: Athens vs. Sparta in the Peloponnesian War, and U.S. vs. USSR during the cold war.
1. Based on the above examples, please provide a short definition of close competitions and
list the features that distinguish them from other competitions? (200 words, 10 points)
2. Read the case on cola wars on the course website and answer the following questions.
(1)Evolving structures (100 words, 5 points)
List the four types of participants in the cola industry. What are the relations among
them? Why do Coke and Pepsi sometimes want to have full control of the bottling networks
while other times not? What are the benefits and drawbacks of doing so?
(2)Competitive dynamics (100 words, 5 points)
Between Coke and Pepsi, who won the wars in 1970s, 1980s, 1990s, and 2000s? For
each period, list two strategies by Coke or Pepsi that significantly affected their competitive
advantages? What roles do imitations and innovations play in the competitions? What
consequences of the cola wars are on smaller concentrate producers and bottlers?
(3)Potential challenges (100 words, 5 points)
What were the challenges to the profitability of Coke and Pepsi since mid 1990s? What
measures did they take to address these challenges? Were they successful? In the future,
how can they perpetuate their advantages in new markets? Do they need a second
foundation and how to do that? Who currently looks more likely to win the cola wars?
3. Find another example of close competitions (except the above ones and the HBS cases used
in class) and provide a summary. (200 words, 10 points)
4. What conclusions would you draw for wining close competitions? These conclusions should
be general, comprehensive, and supported by both theories and examples. [Hint: consult the
theories and cases we have studied on structure, leadership, innovation, network, culture,
embeddedness, ecology, contingency, etc.] (300 words, 15 points)


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