The Role of IT in Business

Question 1

T/F: the application of information technology in an organization is the systematic implementation of hardware and software so that data can be transmitted, modified, accessed, and stored both securely and efficiently

Answer 1

True

Question 2

What is hardware?

Answer 2

the physical components of computers and computer-related accessories; it includes a wide array of internal computer components as well as external peripheral devices

Question 3

What are networking devices?

Answer 3

it enables connectivity and communication between devices on a computer network; those devices transmit information, or packets, between devices in order to communicate with each other; packets are pieces of data that contain multiple layers of information

Question 4

What is a modem?

Answer 4

it connects an organization’s network to the internet

Question 5

What is a router?

Answer 5

it manages network traffic by connecting devices to form a network

Question 6

What are switches?

Answer 6

they are similar to routers in that they connect and divide devices within a computer network; however, they do not perform as many advanced functions as a router, such as assigning IP addresses

Question 7

What is a gateway?

Answer 7

a computer or device that acts as an intermediary between different networks; it transforms data from one protocol into another so that information can flow between networks; a protocol is a rule or set of rules that governs the way in which information is transmitted

Question 8

What are servers?

Answer 8

they are physical or virtual machines that coordinate the computers, programs, and data that are part of the network

Question 9

What is a firewall?

Answer 9

it is software applications or hardware devices that protect a person’s or a company’s network traffic by filtering it through security protocols with predefined rules

Question 10

What is the functionality and way in which different network devices support an organization’s IT infrastructure?

Answer 10

internet –> firewall –> modem –> router –> switch –> server –> user

Question 11

What is software?

Answer 11

it consists of the applications, procedures, or programs that provide instructions for a computer to execute; it is controlled by a user interacting with the program

Question 12

What are networks?

Answer 12

a group of computers and other machines that are interconnected electronically using a series of networking devices so that one group of users may securely share resources; they can be wired or wireless and use a variety of hardware to enable connectivity

common types of networks are: local area network (LAN), wide-area network (WAN), software-defined wide-area network (SD-WAN), edge-enabled devices, virtual private network (VPN)

Question 13

What is mobile technology?

Answer 13

it is wireless telecommunication that utilizes radio waves to transmit signals between devices; it moves with users without wires for connectivity, supporting remote work in real time and sustaining businesses that might otherwise collapse during a crisis or a temporary inability to meet in person

an extension of mobile technology is IoT (internet of things) devices, which refers to a class of devices that is powered by a number of mobile technologies such as wifi, bluetooth, and cellular technology to access a larger network

Question 14

What is a management information system (MIS)?

Answer 14

it enables companies to use data as part of their strategic planning process as well as the tactical execution of that strategy

Question 15

What are the 3 subsystems of MIS?

Answer 15

accounting information systems (AIS) - it collects, records, and stores accounting information, then compiles that info using accounting rules to report both financial and nonfinancial information to decision makers in an enterprise; they are typically made up of 3 modules: transaction processing system, financial reporting system or general ledger system, and management reporting system; there are 3 main functions: collect, record, and store data transactions, transform data into info through compilation and reporting, and safeguard and maintain data integrity

decision support systems (DDS) - it provides interactive tools to support day-to-day decision making; it can model “what-if” scenarios and help drive management decisions

executive information systems (EIS) - usually comes in the form of a dashboard that consolidates info so that senior executives can quickly evaluate key statistics for an organization but provides the ability to drill down when necessary

Question 16

What is a customer relationship management system (CRM)?

Answer 16

software that enables organizations to monitor and manage interactions between the organization and its past, present, and future customers

Question 17

What is supply chain management (SCM)?

Answer 17

it unifies business processes beginning with the original supplier and ending with the customer; it is concerned with the 4 important characteristics of every sale: what, when, where, how much

it generally incorporates: planning sourcing, manufacturing, and delivering

Question 18

What is enterprise resource planning (ERP)?

Answer 18

it is a system that is cross-functional that supports different business functions and integrates info across departments; it facilitates real-time communication between systems and typically operates under a centralized database and user interface

it provides great benefits to an organization with a focus on integration of all enterprise data into a single channel for simplification; they take a long time to implement and can be extremely cost prohibitive

Question 19

What is enterprise performance management?

Answer 19

software solutions designed to help executives make strategic decisions; it is useful for the analysis of high-level business strategies and translating them into actionable plans or strategic objectives; they are more management-process focused (where ERP is more operational-process focused)

Question 20

What is e-commerce?

Answer 20

electronic platforms that facilitate the sale of goods and services using the internet; it removes overhead costs, creates markets that might not exist otherwise, promotes competitive pricing, allows for product comparison more quickly, and provides parity in info among market participants

there are 5 types of e-commerce: business-to-business (B2B), business-to-consumer (B2C), consumer-to-business (C2B), consumer-to-consumer (C2C), and government e-commerce

Question 21

What is cloud computing?

Answer 21

renting storage space, processing power, proprietary software, or a combination of the three, on remote servers from another company rather than buying or building those components

Question 22

What are some pros and cons to IT outsourcing?

Answer 22

pros: lower costs, expertise, resources, and enhanced focus on the core business

cons: less control, quality control, immediate access to IT support

some risks are: security and privacy practices, data accessibility, data disposal, vulnerability for attacks

Question 23

What are system and organization controls (SOC) reports?

Answer 23

a collection of reports developed by the AICPA to be issued by CPAs in connection with the evaluation of “system-level controls” or “entity-level controls” for service-based firms; there are 3 reports:

SOC 1 - to provide assurance that the service organization’s controls are designed and operating effectively so that the financial statements are not negatively impacted (there is a Type 1 and Type 2)

SOC 2 - for users who need attestation concerning controls as they relate to security, processing integrity, availability, and privacy (there is a Type 1 and Type 2)

SOC 3 - for users who need attestation concerning controls as they relate to security processing integrity, availability, and privacy; however, this report is for companies that do not have the knowledge required to make an effective use of a SOC 2 report