IS Unit 2

Question 1

What is strategic role of information systems?

Answer 1

involves using information technology to develop products, services, and capabilities that give a company major advantage over
the competitive forces it faces in the global

Question 2

This role is accomplished through a strategic information architecture: the collection of ___________ that supports or shapes the competitive position and strategies of a business enterprise.

Answer 2

strategic information systems

Question 3

can be any kind of information system (e.g., TPS, MIS, and DSS) that uses information technology to help an organization gain a competitive advantage, reduce a competitive disadvantage, or meet other strategic enterprise objective.

Answer 3

strategic information systems

Question 4

Enumeration: Competitive Forces

Answer 4

Rivalry of Competitors
Threat of New Entrants
Threat of Substitutes
Bargaining Power of Customers and Suppliers

Question 5

Competition is a positive characteristic in business, and competitors share a natural, and often healthy, rivalry. This rivalry encourages and sometimes requires a constant effort to gain competitive advantage in the marketplace.

Answer 5

Rivalry of Competitors

Question 5

Guarding against the threat of new entrants also requires the expenditure of significant organizational resources. Not only do firms need to compete with other firms in the marketplace, but they must also work to create significant barriers to the entry of new competition. This competitive force has always been difficult to manage, but it is even more so today. The Internet has created many ways to enter the marketplace quickly and with relatively low cost.

Answer 5

Threat of New Entrants

Question 6

The threat of substitutes is another competitive force that confronts a business. The effect of this force is apparent almost daily in a wide variety of industries, often at its strongest during periods of rising costs or inflation. When airline prices get too high, people substitute car travel for their vacations. When the cost of steak gets too high, people eat more hamburger and fish.

Answer 6

Threat of Substitutes

Question 6

a business must guard against the often-opposing forces of customer and supplier bargaining powers. If customers bargaining power gets too strong, they can drive prices to unmanageably low levels or just refuse to buy the product or service.

Answer 6

Bargaining Power of Customers and Suppliers

Question 7

Enumeration: Competitive Strategies

Answer 7

• Cost Leadership Strategy
• Differentiation Strategy
• Innovation Strategy
• Growth Strategies
• Alliance Strategies
• Other Strategies

Question 7

Becoming a low-cost producer of products and services in the industry or finding ways to help suppliers or customers reduce their costs or increase the costs of competitors.

Answer 7

Cost Leadership Strategy

Question 8

TorF. Competitive strategies are not mutually exclusive.

Answer 8

TRUE

Question 8

Finding new ways of doing business. This strategy may involve developing unique products and services or entering unique markets or market niches (recess).

Answer 8

Innovation Strategy

Question 8

Developing ways to differentiate a firm’s products and services from those of its
competitors or reduce the differentiation advantages of competitors.

Answer 8

Differentiation Strategy

Question 9

Significantly expanding a company’s capacity to produce goods and services, expanding
into global markets, diversifying into new products and services, or integrating into related products and services.

Answer 9

Growth Strategies

Question 9

Establishing new business linkages and alliances with customers, suppliers, competitors, consultants, and other companies.

Answer 9

Alliance Strategies

Question 10

Enumeration

The key strategies that can be implemented with information technology includes:

Answer 10

a. locking in customers or suppliers,
b. building switching costs,
c. raising barriers to entry, and
d. leveraging investment in information

Question 10

Investments in information technology can allow a business to lock in customers and suppliers (and lock out competitors) by building valuable new relationships with them.

Answer 10

Lock in customers or suppliers

Question 11

These business relationships can become so valuable to customers or suppliers that they deter (discourage) them from abandoning a company for its competitors.

Answer 11

Lock in customers or suppliers

Question 12

They then become reluctant (unwilling or hesitant) to pay the costs in time, money,

Answer 12

Building switching costs

Question 13

More recent projects characterize a move toward more innovative uses of information technology.

Answer 13

Lock in customers or suppliers

Question 14

A major emphasis in strategic information systems has been to find ways tocreate

Answer 14

Building switching costs

Question 14

In other words, investments in information systems technology can make customers or suppliers dependent on the continued use of innovative, mutually beneficial inter-enterprise information systems.

Answer 14

Building switching costs

Question 15

Typically, these barriers increase the amount of investment, or the complexity of the technology required to compete in an industry or a market segment.

Answer 15

Raising barriers to entry

Question 15

By making investments in information technology to improve its operations or promote innovation, a firm could also raise barriers to entry that would discourage.

Answer 15

Raising barriers to entry

Question 15

Such actions tend to discourage firms already in the industry and deter external firms from entering the industry.

Answer 15

Raising barriers to entry

Question 16

Investing in information technology enables a firm to build strategic IT capabilities so that they can take advantage of opportunities when they arise.

Answer 16

Leveraging investment in information
technology

Question 16

Who develop value chain concept?

Answer 16

Michael Porter

Question 17

In many cases, this happens when a company invests in advanced computer- based information systems to improve the efficiency of its own business processes.

Answer 17

Leveraging investment in information
technology

Question 17

The ______ means to keep customers loyal, anticipate their future needs, respond to customer concerns, and provide top-quality customer service.

Answer 17

customer focused-business

Question 18

A ________ helps its e-commerce customers help themselves while also helping them do their jobs. Finally, a successful business nurtures an online community of customers, employees, and business partners that builds great customer loyalty as it fosters (encourage the development of) cooperation to

Answer 18

customer focused-business

Question 19

It views a firm as a series, chain, or network of basic activities that add value to its products and services and thus add a margin of value to both the firm and its customers.

Answer 19

Value Chain

Question 19

This framework can highlight where competitive strategies can best be applied in…

Answer 19

Value Chain

Question 20

Are those business activities that are directly related to the manufacture of products or the delivery of services to the customer.

Answer 20

Primary Processes

Question 20

TorF. the value chain concept can help you identify where and how to apply the strategic capabilities of information technology.

Answer 20

TRUE

Question 20

are those business activities that help support the day-to-day operation of the business and that indirectly contribute to the products or services of the business and that indirectly contribute to the products or services of the organization.

Answer 20

Support Processes

Question 20

TorF. a coordinated and integrated customer relationship management system cannot dramatically improve customer service.

Answer 20

FALSE