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Information Systems Flashcards

1
Q

How is IT impacting business?

A

Spurring creation of new businesses
EX: amazon
Increased buyer and supplier and customer relationships

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2
Q

3 ways digital differs from traditional markets

A

Digital mainly exchange digital products/services
Competitive dynamics differ
IT plays a big role

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3
Q

Nature of digital products/services

A

Many bundled options
Increasing consumption of digital products/services
High initial, low variable costs (ebooks, music)

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4
Q

Examples of digital firms

A

Groupon, FB, Paypal

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5
Q

2 types of digital markets

A

Hybrid and pure

Many firms can be both types at once

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6
Q

Hybrid market

A 
Value stream (end to end business process) has been standardized
Physical products/services--Amazon
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7
Q

Pure digital market

A

Entire value stream is digital

Ex: google

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8
Q

Digital economies

A

Arise in digital markets

Long tail, network and 2 side network effects

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9
Q

Long tail effect

A

Can capture the long tail of the market
Niche areas
Can accommodate the 80% that offer 20% of value
Pareto rule

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10
Q

Supply side factors of long tail effect

A

Lower inventory stocking costs
Cheaper promo/ads–FB ads
Cheaper production/replication
No geographic constraints

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11
Q

Demand side factors of long tail effect

A

SEO
Recommendation systems
Viral effect

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12
Q

Network effect

And 2 implications

A

Value grows with network growth
Ex: FB
Critical mass–when momentum is unlikely to be disrupted by a new entrant
Winner takes all–firms can capture more of the market than a traditional marketplace would allow
EX: gmail,

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13
Q

How to get positive network effect

A

Customer is excited about digital product
Negative WOM is devastating
Exploit WOM
Using complements

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14
Q

2 side network effect

A

When digital site is in the middle
EX: Google caters to customers–us and advertisers
Ex: adobe
Also uses critical mass

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15
Q

2 types of positive network effects

A

Same side–the more people adopt, the more benefit to that side: FB messenger
Cross side effect–Audible, the more listeners, the more publishers want to have their books on there
Book example is adobe for both

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16
Q

Negative network effect examples

A

Job site–the more applicants, the less likely your application will get picked up

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17
Q

1 vs 2 side network effects

A

2 sided are pure info brokers–paypal
1 side–ownership changes hands twice, EX: P&G sells to Walmart who sells to consumer
Some firms are both like Amazon

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18
Q

Platform mediated markets

A

Firms compete by offering customers similar platforms and trying to get the most number of customers
Easiest to get customers if entry is free

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19
Q

4 features of winner takes all

A

Platform has extreme positive network effects
Participants don’t want to switch
Platform gets the majority of new customers
Platform gets accelerated flow of competitors customers

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20
Q

Information System Definition

A

Computer based system designed to accomplish business objectives

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21
Q

7 elements of IS

A 
Business objective 
Business process
Data
People
Computer hardware
Computer software: applications and systems
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22
Q

Data, info and knowledge distinctions

A

Data–captured attributes of objects and events–formed by individuals aware of it’s definition–stored by databases and archives–exchanged explicitly
Info–data that can be interpreted–formed by individual interpretation–exchanged implicitly
Knowledge–exists across people–formed by individual and group learning–stored in people’s minds–exchanged tacitly or explicitly

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23
Q

5 primary IS types

A

Transaction processing–capture and store data about objects and events
Info reporting–retrieve data to produce specified reports
Decision support–retrieves data for manipulation by individuals on an ad hoc basis
Automated decision–imbeds decision rules so decisions can be made automatically and without human interaction
Communication support–support person to person interaction

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24
Q

Automated decision system examples

A

POs sent when inventory hits certain level
Automatic release of work schedules
Fraud detection
Forecasting

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25
Q

Exception report

A

A report generated when a certain condition is met

EX: a defect report generated when defects reach an established level

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26
Q

Decision support system examples

A

Determining need and location for new facility, if should develop a new market, employee benefits packages

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27
Q

Automation

A

Removal of human use

Pros: cost and error reduction, increased cycle time, productivity and responsivness

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28
Q

2 early adopters of IT examples

A

American airlines and Merrill lynch

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29
Q

Chameleon like nature of IT

A

Firms can all have same tech but use it differently

EX: RFID

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30
Q

Which leads strategy: business or IT

A

Mainly business leads and IT follows

Some firms do visa versa when have superb IT competitive advantage EX: Walmart

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31
Q

Requirements of IT as a competitive advantage

A

Luck and good planning

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32
Q

Challenge of IT as a competitive advantage

A

Lack of good ideas for implementation

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33
Q

Business model definition

A

Strategic choices on how to create value and be profitable

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34
Q

4 elements of business models

A

Customer value proposition–target customers
Profitability model–how to be profitable
Resources needed–tangible and intangible
Business processes needed

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35
Q

Value disipline

A

Aligns requirements and customer expectations

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36
Q

3 types of value disiplines

A

Customers want: low cost, quality and convenience–firms use operational excellence EX: Walmart
Customers want: tailored items and will pay premium–firms use customer intimacy EX: Ritz, Kraft
Customers want: new, stylish products/services and will pay premium–firms use product leadership EX Apple

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37
Q

Operational excellence characteristics

A

Streamlined operations
Customer service
SC–like prolonged payments for suppliers, minimize days of sales in inventory
Optimize finances

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38
Q

Customer intimacy characteristics

A

Micro-segment the market
CRM
Good advertising/marketing

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39
Q

Product leadership characteristics

A

Customer focused products
Quick manufacturing
Good QA

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40
Q

4 strategic roles of IT

A

Automation
Control
Empowerment
Collaboration

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41
Q

IT for control

A

Pros: real time monitoring and event visibility and business rule automation
Catch problems before they are big

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42
Q

IT for emplowerment

A

Pros: data and info and knowledge distribution and access, business intelligence tools
Gives power to employees

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43
Q

IT for collaboration

A

Pros: complex business process execution, problem handling, business and product and business model innovation

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44
Q

Examples of business model innovation

A

Google–targeted ads–enabled by SEO
Walmart–EDLP–enabled by SC
FedEx–overnight shipping–enabled by tracking

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45
Q

Why is keeping IT competitive advantage difficult

A

built on readily available tech
follower learning advantages
competitors with better tech beat you

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46
Q

Sustaining IT competitive advantage

A

Create barriers like
Time it takes for others to get your IT
Resource barriers
Complementary resources
Project management–like how complex of an undertaking it is
Preemption barriers–like does it cost customer to switch to a competitor

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47
Q

Potential IT enabled business decisions

A

Ideas for use of IT in competitive advantage

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48
Q

2 categories of IT infrastructure

A

Organization (privately owned)

Public–internet

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49
Q

2 types of IT infrastructure

A

Technical and business platforms

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50
Q

5 types of resources of IT infrastructure

A

Hardware
Design
Data
Human and social resource

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51
Q

Technical platforms

A

Foundation for business platforms

Configuration of IT resources for a broad range of technical platforms

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52
Q

Business platforms

A

Configuration of IT resources for design and operation of business

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53
Q

2 types of IT resources

A

Local–used by specific organizational units

Global–used across organizational units

54
Q

Examples of IT resources

A

Storage devices
Data management systems
IP addresses
Database design

55
Q

3 stages of IT evolutio

A

Local optimization–each area having a specific tech platform for itself
Tech standardization–using single tech standards across business functions
Process optimization–even more interconnected
All underlined by global shared service–

56
Q

Challenges of tech standardization and process optimization

A

Perceived idea that IT spending is too high, taking action too late making change costly and time consuming

57
Q

System Interface

A

Solution to integrating tech and process
Modifying platforms to understand data from each other
Only works with limited platforms

58
Q

Global database

A

Solution to integrating tech and process
Redesign all for comprehensive system
Getting all sections to agree is difficult
Overhaul is complex, time consuming and expensive

59
Q

Middleware

A

Solution to integrating tech and process
Uses a middleman software to convert data into understandable packages for each interface
Complex to implement but much cheaper

60
Q

Enterprise resource planning (ERP) system

A

A pre-made package of IT that fit optimal global standards
This saved you from having to fashion your own IT
Components: enterprise database, software modules for global business processes, systems linked to ERP system

61
Q

Preface for ERP

A

Y2K–programers used last 2 digits of years to identify data

62
Q

Bolt On

A

A fix for configuring your IT with an ERP system

63
Q

Key properties of ERP

A

Multifunctional–wide range of functions
Modular–easily tailored per business
Best practices–tailored for each industry
Extendible–connects to other IT through bolt ons
Integrated–global data storage

64
Q

Disadvantages of ERP

A

High cost
Disruption among firm when implementing
Difficult to realize full potential
Strategic implications of universal system
Depend on ERP vendor
Frequent and expensive new version releases

65
Q

Advantages of ERP

A 
Enterprise database
Timely data
Standardized and integrated data practices
Lower IT cost
Faster implementation of new IT systems
66
Q

Alternatives to ERP

A

Firms use their own IT connected through Middleman
Finds IT systems and cobbles them together
To be successful with either method you must have strong IT capabilities

67
Q

Political and financial issues with IT infrastructure

A

Political: who establishes IT standards, who is responsible for monitoring, how to enforce standards, how to determine exceptions
Financial: who pays

68
Q

High vs. low IT investing for organizations

A

High investors have more turbulent business environments
Higher investors with high performance had 50% higher profit margins
Low investors with high performance had 20% higher profit margins than competitors
Meaning: high investment is not necessary if it doesn’t fit your market

69
Q

IT productivity paradox

A

Growing IT investment does not equal growing returns

70
Q

2 factors of realizing IT investment

A

Organizations have lots of interconnected data and processes
Organizations have large stock of IT management capabilities
As more and more is digitized, tipping point is reached

71
Q

4 IT investment targets and value drivers

A

IT ops and services: (improving). Value driver–performance price ratios, employee knowledge/skills
Business process efficiency: (by automating and rationalizing)–VD–IT strategic roles, business capabilities and first order learning
Business process effectiveness: VD–IT strat roles, business capabilities, first order learning and product market first order learning
Business model VD–IT strat roles, business capabilities, first order learning and product market second order learning, business process second order learning

72
Q

Performance price ratios

A

Hardware and software betterment like more data storage, faster processing time etc.

73
Q

Business process efficiency firm examples

A

FedEx, Walmart, Soutwest airlines, Dell

74
Q

First order learning

A

Redefining business process without changing underlying core

75
Q

Product market first order learning

A

Understanding customers expectations about the business

76
Q

Second order learning

A

How 4 IT strategic roles can be implemented creatively

77
Q

IT value pathway reasons

A 
Respond to external parties
Upgrade IT assets
Respond to competition
Make business process improvements
Generate future business capabilities
Gain a competitive advantage
78
Q

Mandated It value pathway

A

When you are forced to by an external party

79
Q

IT mandate examples

A

Vendor hardware/software updates
Tax law
Privacy requirements

80
Q

Technology renewal

A

Refreshing IT for performance advantage or various reasons

81
Q

2 ways for tech renewal

A

Upgrade IT

Tech overhaul

82
Q

2 tactics to use IT as a comp advg

A

Building distinctive info capabilities and business processes
Differentiation

83
Q

Options generating IT platform

A

Don’t expect costs covered initially but can grow and adapt platform with time
EX: bank of america

84
Q

Method for applying IT capabilities

A

Create a capability map which is in order of importance
Business model
Financial outcomes
Business capabilities
Business processes
Gives a rationale and logic for IT investment

85
Q

Adaptive agility

A

Quick speed and response to competitors actions or changes in market

86
Q

Entrepreneurial agility

A

Constant churn of new products

87
Q

Operational domain

A

Efficient/effective handling of transactions in the business process

88
Q

Analytical domain

A

Making sense of accumulated data

AKA business analytics

89
Q

Collaborative domain

A

Allowing individuals working on business decisions or processes to collaborate regardless of location

90
Q

2 reasons for existence of industry value streams

A

Transaction cost theory

Intermediation theory

91
Q

Transaction cost theory

A

Make vs. buy decisions

total cost=production + transaction costs

92
Q

Examples of transaction costs

A

Bidding
Searching
Legal
Monitoring

93
Q

Intermediation theory

A

Using an intermediary

EX: you can’t always buy from manufacturer but need to buy from a store

94
Q

Value adding roles of intermediaries

A

Search efficiency–customers can find your product
Demand aggregation–collect orders from multiple parties
Create packages–bundles for specific needs
Guarantee transactions–handle complex process
Manage logisitics

95
Q

Challenge of long and wide intermediaries

A

No consolidation of data=volatile demand (bullwhip)

96
Q

Dealing with demand uncertainty

A

Vertical integration
Stock holding
Digitization–consolidating and sharing data

97
Q

Digitizing workflows

A

ERP
SCM
CRM

98
Q

Actions of digitized workflows for data and info

A

Exchange–move from one place to another
Push–move to multiple places from one place
Sense–see something occurred or is available
Access–retrieve from storage
Translate–convert from one form to another

99
Q

2 ways of interconnecting data from one firm to another

A

Tight coupling–one or both systems are modified–highly intrusive, but effective
Loose coupling–use middleware, or both parties conform to some standards
Loose coupling also has costs and organizations need higher IT levels

100
Q

Dis/advantages of tight coupling

A

Pros: single partner cost, less need to invest in IT, speed and responsiveness
Cons: intrusive, multiple partner costs, not adaptable

101
Q

Dis/advantages of loose coupling

A

Pros: not intrusive, no multiple partner costs, adaptable
Cons: multiple partner costs, need to invest in IT, slow

102
Q

2 goals of digitizing operational domain

A

Improve visibility of events and data

Increase channel multiplicity

103
Q

Channel multiplicity

A

Number of channels with which IT system can connect with others
Ways organization members can connect with each other
The more ways to communicate the better

104
Q

Benefits of broad and deep operational visibility

A

Reduced costs
Improved quality
Improved speed and saved time
Faster adaptivness

105
Q

Challenges of operational visibility

A

Hard to get employee inter-department cooperation

106
Q

2 goals of digitizing analytical domain

A

Improving decision process

Accumulating knowledge to use in decision process

107
Q

Data mart

A

Small archive often for specific business functions

108
Q

Business intelligence analytical tools

A 
Ad hoc queries
Structured queries
Online analytical processing (OLAP)
Data mining
Heavily used by marketing division
109
Q

Pros of digitizing collaboration

A

Save on travel
Hard to get everyone together at same time
Participants work best if close to their own peers
EX: rocket engine built this way

110
Q

Digitized collaboration tool examples

A

Internet notebook–shared notebook
Electronic whiteboard
Project vault–data storage for everyone
Email, phone etc.

111
Q

Wisdom of crowds

A

Using groups to confront uncertainty

Prediction markets

112
Q

Prediction markets

A

Using large group to form opinion for something with great uncertainty

113
Q

4 cross firm value stream collaborations

A

Customer facing opportunities: all parts of value chain collaborate
Logistical opportunities: improvement
SC opps: improvement
Product and process design opps: improvement

114
Q

3 trends amplifying benefitting from other firms who work with you

A

Accelerated development time
Cost effective for firms to connect virtuallyInternet has given rise to new opps
all leads to more outsourcing aka externalizing

115
Q

3 main activity centers of firms

A

CRM
Ops
Innovation

116
Q

Work bundling trend

A

more and more unbundled due to decrease in cost of doing so

117
Q

Benefits of outsourcing

A

Econ of scale and scope
Tech expertise
Lower costs
Can switch ops easily

118
Q

Negatives of outsourcing

A

No quality control
Slow
Loss of tech knowledge
too much dependance

119
Q

On/Offshoure

A

Abroad or in home country

120
Q

Alignment of strategic interest

A

The closure of partners you are, the more aligned you’ll be

121
Q

Tight or loose governance

A

How much control you have over supplier
Tighter indicates emphasis on quality and cost
Loose on innovation

122
Q

Most commonly outsourced activities

A

IT
Software development
Application service (email)

123
Q

Reasons for IT outsourcing

A

Ops efficiency and flexibility
Obsolescence risk reduction
Tech/knowledge acquisition
Gain Comp Advg

124
Q

Value network

A

Close collaboration with certain partners

Leads to benefits for both

125
Q

Ways of SM impact

A

Act as a megaphone–distribute content
Magnet–attract customers
Monitor

126
Q

Assumption of IT investment

A

It will be realised quickly and frustration comes when this doesn’t happen

127
Q

5 stages of IT implementation

A
  1. approval and funding
  2. configuration
  3. installation and shakedown
  4. lethargy–some skip this stage
  5. onward and upward
    Cash realization accelerates from shakedown stage
    Low hanging fruit from stage 3
128
Q

Reasons for adopting new IT

A 
You are told to
You think it'll be useful
You think it'll be easy
Co-works speak of it favorably
Managers/supervisors speak of it favorably
129
Q

5 elements of the nature of a firm

A 
Why it exists 
How its structured
Business processes
Employees education etc.
Tech that supports
130
Q

2 Ways to facilitate organizational change

A

Firms are messy systems, not machines and shouldn’t be treated as such
Connect with and encourage employees to care about change, don’t fight with them on it

Information Systems (1 decks)

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