Chapter 1 & 2

Question 1

The IS strategy drives the business strategy.

Answer 1

False

Question 2

A social business strategy is designed to use social IT tools for all of the following EXCEPT:

Collaborating with stakeholders
Building deeper connections with stakeholders
Innovating with stakeholders
Excluding stakeholders
Networking with employees, customer and/or suppliers

Answer 2

Excluding stakeholders

Question 3

There has been accelerated competition among market leaders concurrent with the increases in the quality and quantity of IT investments.

Answer 3

True

Question 4

Which one of the following is NOT part of the information systems strategy matrix?

Answer 4

Personnel

Question 5

When an organization qualifies its product or service in a way that allows it to appear unique in the marketplace, this is called:

Answer 5

Differentiation

Question 6

The “Managerial Levers” concept is useful for the following reasons:

Answer 6

Management should not make a change unless they align multiple issues, such as tasks, measures, values, incentives, etc.

Question 7

By using IS to achieve economies of scale and generate operating efficiencies, Walmart epitomizes which one of Porter’s generic strategies?

Answer 7

Cost leadership

Question 8

To avoid unwanted consequences, altering the IT Strategy requires adjustments to the organizational strategy.

Answer 8

True

Question 9

A bank provides its customers mobile applications that significantly simplify traditional banking activities. For example, a customer can use a smartphone to take a picture of a check and electronically deposit into an account. This unique service demonstrates the bank’s desire to practice which one of Porter’s strategies?

Answer 9

Differentiation

Question 10

General managers should take an active role in decisions about information systems. This is vital because:

Answer 10

Information systems are designed to support business objectives.

Question 11

Significant changes in IS should trigger a reassessment of the _____________.

Answer 11

business strategy

Question 12

Organizations seek to gain a competitive advantage by differentiation, cost, or _________.

Answer 12

focus

Question 13

A general manager should:

Answer 13

Understand the use and consequences of technologies relevant to the business

Question 14

When a company’s business strategy and technology strategy are intertwined, this situation is known as _______.

Answer 14

convergence

Question 15

Hypercompetition refers to where a firm obtains more than 5 strong competitors.

Answer 15

False

Question 16

Which is not a question that can be used to understand organizational design?

Answer 16

Where is the organization’s headquarters located?

Question 17

Google has disrupted a number of industries, particularly the advertising and software industries. Google’s ability to quickly and aggressively provide new products and services is best described by:

Answer 17

The Hypercompetition Model

Question 18

The organizational strategy should ideally _____ the IS strategy.

Answer 18

complement

Question 19

This framework is called the ____________________ because it relates business strategy with IS strategy and organizational strategy.

Answer 19

Information Systems Strategy Triangle

Question 20

The ____________ is a plan articulating where a business seeks to go and how it expects to get there.

Answer 20

business strategy

Question 21

There has been accelerated competition among market leaders concurrent with the increases in the quality and quantity of IT investments.

Answer 21

True

Question 22

Business strategies based on hypercompetition focus on customer satisfaction and profit maximization but also build in a component of business intelligence. Business intelligence helps an agile organization to:

Answer 22

Predict and respond to new opportunities

Question 23

All of the following benefit from the network effect EXCEPT:

Answer 23

Network bandwidth

Question 24

Kodak was once the largest supplier of photographic film. In 2004 it was dropped from the Dow Jones Industrial Average after having been listed for 74 years. Kodak failed to use IT to fend off which one of the following of Porter’s 5 competitive forces?

a) Bargaining power of suppliers
b) Threat of substitute products
c) Potential threat of new entrants
d) Bargaining power of buyers
e) Industry collaboration

Answer 24

Threat of substitute products

Question 25

An inter-organizational relationship that affords one or more companies in the relationship a strategic advantage:

Answer 25

Strategic Alliance

Question 26

The supply chain:

Answer 26

Is composed of several value chains linked into a larger chain (a chain within a chain).

Question 27

Which one of the following is not considered to be a primary activity of the value chain of a firm?

Answer 27

Technology

Question 28

Porter’s five “Forces,” used so often in the text for analysis of IT applications, include all of the following except:

Threat of substitute products
Bargaining power of suppliers
Bargaining power of customers
New entrants
Switching costs

Answer 28

Switching costs

Question 29

A firm releases a new technology only to have a competitor implement a similar technology with more features and value to the consumer. This would be which type of risk?

Answer 29

Awakening a sleeping giant

Question 30

Which of the following is NOT a primary activity of the Value Chain model?

Answer 30

Operations

Question 31

The three major categories of IT capabilities are technical skills, management skills, and relationship skills.

Answer 31

True

Question 32

A company that is in a market with few buying options for the consumer is enjoying a high amount of which one of Porter’s Five Competitive Forces?

Answer 32

Bargaining power of suppliers

Question 33

Suppose Zara has a linked supply chain with Silk City, a fabric supplier. Zara and Silk City use IT to seamlessly exchange data, communicating requirements as well as delivery expectations. The relationship between Zara and Silk City is best described as:

Answer 33

Strategic alliance

Question 34

Which of the following is a support activity of the Value Chain Model?

Answer 34

Organization

Question 35

Which is not a prescribed area of focus for gaining competitive advantage?

Answer 35

Insider Information

Question 36

Zara’s use of information resourses has given it a substantial advantage over its competitors.

Answer 36

True

Question 37

While information systems can be used to gain a strategic advantage, they have inherent risks. Hershey Foods, for example, crippled its Halloween sales when its complex IS system failed to support its supply and inventory needs during peak production season. This is an example of which specific IS risk?

Answer 37

Implementing IS poorly