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Which of the following is an example of a function supported by payroll processing within a Transaction Processing System?
Which of the following is an example of a function supported by payroll processing within a Transaction Processing System?
What is the primary function of a Transaction Processing System (TPS)?
What is the primary function of a Transaction Processing System (TPS)?
In what way do Transaction Processing Systems (TPS) aid managers?
In what way do Transaction Processing Systems (TPS) aid managers?
What types of outputs can be generated from a payroll Transaction Processing System?
What types of outputs can be generated from a payroll Transaction Processing System?
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How does ERP enhance the operational efficiency of a company like FreshDirect?
How does ERP enhance the operational efficiency of a company like FreshDirect?
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Which of the following best defines business processes?
Which of the following best defines business processes?
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What role do enterprise applications play in a business?
What role do enterprise applications play in a business?
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Which functional area is specifically related to creating financial statements?
Which functional area is specifically related to creating financial statements?
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What is one of the key roles of the information systems function in a business?
What is one of the key roles of the information systems function in a business?
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How can business processes be viewed within an organization?
How can business processes be viewed within an organization?
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Which of the following best exemplifies a cross-functional business process?
Which of the following best exemplifies a cross-functional business process?
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What are potential outcomes of ineffective business processes?
What are potential outcomes of ineffective business processes?
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Which of the following functions is primarily concerned with identifying customers?
Which of the following functions is primarily concerned with identifying customers?
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What is the primary role of the information systems department within an organization?
What is the primary role of the information systems department within an organization?
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Which position is typically not found in the information systems department?
Which position is typically not found in the information systems department?
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What aspect of IT does IT Governance encompass?
What aspect of IT does IT Governance encompass?
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Which of the following is a responsibility of end users within the information systems framework?
Which of the following is a responsibility of end users within the information systems framework?
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What are management information systems (MIS) primarily designed for?
What are management information systems (MIS) primarily designed for?
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What is the primary function of Management Information Systems (MIS)?
What is the primary function of Management Information Systems (MIS)?
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Which system primarily supports middle management in making non-routine decisions?
Which system primarily supports middle management in making non-routine decisions?
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What types of information does an Executive Support System (ESS) incorporate?
What types of information does an Executive Support System (ESS) incorporate?
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How does a Data Driven Decision Support System (DSS) function?
How does a Data Driven Decision Support System (DSS) function?
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What example illustrates the use of an Executive Support System?
What example illustrates the use of an Executive Support System?
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Which system focuses primarily on routine transaction processing?
Which system focuses primarily on routine transaction processing?
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What is a key characteristic of a Decision Support System (DSS)?
What is a key characteristic of a Decision Support System (DSS)?
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Which of the following best describes the role of managers using MIS?
Which of the following best describes the role of managers using MIS?
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What is the primary function of enterprise systems within an organization?
What is the primary function of enterprise systems within an organization?
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Customer relationship management (CRM) systems are primarily designed to assist with which of the following?
Customer relationship management (CRM) systems are primarily designed to assist with which of the following?
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Which of the following best describes the goal of supply chain management (SCM) systems?
Which of the following best describes the goal of supply chain management (SCM) systems?
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Knowledge management systems (KMS) support what type of processes within an organization?
Knowledge management systems (KMS) support what type of processes within an organization?
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What defines e-business in contrast to e-commerce?
What defines e-business in contrast to e-commerce?
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How do intranets typically function within an organization?
How do intranets typically function within an organization?
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What is a significant benefit of information technology on business processes?
What is a significant benefit of information technology on business processes?
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What role do business intelligence systems play within management information systems?
What role do business intelligence systems play within management information systems?
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Which system primarily serves middle management by providing performance reports?
Which system primarily serves middle management by providing performance reports?
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How do decision support systems assist managers?
How do decision support systems assist managers?
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What is a key characteristic of enterprise applications?
What is a key characteristic of enterprise applications?
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What is the primary purpose of using extranets in a business context?
What is the primary purpose of using extranets in a business context?
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Which system is primarily focused on daily operational decisions and long-term planning?
Which system is primarily focused on daily operational decisions and long-term planning?
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How can information systems enhance product differentiation?
How can information systems enhance product differentiation?
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What characteristic of the focus on market niche strategy is illustrated by Hilton's On Q System?
What characteristic of the focus on market niche strategy is illustrated by Hilton's On Q System?
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Which of the following practices exemplifies strengthening customer and supplier intimacy?
Which of the following practices exemplifies strengthening customer and supplier intimacy?
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What is a fundamental component of the VRIO framework in attaining competitive advantage?
What is a fundamental component of the VRIO framework in attaining competitive advantage?
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What role does information systems play in product customization, exemplified by Nike's NIKE iD program?
What role does information systems play in product customization, exemplified by Nike's NIKE iD program?
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What advantage does analyzing customer buying habits provide in a niche market strategy?
What advantage does analyzing customer buying habits provide in a niche market strategy?
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In what way do strong linkages to customers and suppliers help a business?
In what way do strong linkages to customers and suppliers help a business?
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What is a key benefit of aligning information technology with business objectives?
What is a key benefit of aligning information technology with business objectives?
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Which of the following aspects is emphasized in the role of Business Process Management (BPM) for competitiveness?
Which of the following aspects is emphasized in the role of Business Process Management (BPM) for competitiveness?
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In Porter’s Competitive Forces Model, which force directly relates to rivalry among existing competitors?
In Porter’s Competitive Forces Model, which force directly relates to rivalry among existing competitors?
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How can effective information systems enhance customer intimacy?
How can effective information systems enhance customer intimacy?
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Which strategy involves using information systems to achieve the lowest operational costs?
Which strategy involves using information systems to achieve the lowest operational costs?
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Why is understanding Porter's Competitive Forces Model important for businesses?
Why is understanding Porter's Competitive Forces Model important for businesses?
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What role do information systems play in enhancing decision-making across business processes?
What role do information systems play in enhancing decision-making across business processes?
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Which component of information systems directly aids in measuring performance against business goals?
Which component of information systems directly aids in measuring performance against business goals?
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How can information systems assist in a career development context?
How can information systems assist in a career development context?
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Which term describes when outputs of some business units can be utilized as inputs to other units within a corporation?
Which term describes when outputs of some business units can be utilized as inputs to other units within a corporation?
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What is a core competency of a firm?
What is a core competency of a firm?
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How do information systems improve business unit performance?
How do information systems improve business unit performance?
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What do network-based strategies primarily rely on?
What do network-based strategies primarily rely on?
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Which of the following exemplifies a disruptive technology?
Which of the following exemplifies a disruptive technology?
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What impact does globalization have on firms prior to the Internet era?
What impact does globalization have on firms prior to the Internet era?
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What is a characteristic of first movers in disruptive technologies?
What is a characteristic of first movers in disruptive technologies?
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Which strategy benefits from the near-zero marginal costs of adding another participant?
Which strategy benefits from the near-zero marginal costs of adding another participant?
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Which of the following allows firms to pool expertise and cut costs?
Which of the following allows firms to pool expertise and cut costs?
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Study Notes
Business Processes and Information Systems
- Business processes are a set of activities and steps that involve the flow of materials, information, and knowledge, and can be limited to a single functional area or cross-functional.
- Businesses are a collection of business processes and these business processes may be assets or liabilities.
- Examples of functional business processes include: manufacturing and production, sales and marketing, finance and accounting, and human resources.
Enterprise Applications
- Enterprise Applications link the enterprise and span functional areas, running business processes across the firm, and including all levels of management.
- Enterprise applications include Enterprise Resource Planning (ERP) systems, Supply Chain Management (SCM) systems, Customer Relationship Management (CRM) systems, and Knowledge Management (KMS) systems.
Information Systems
- Transaction Processing Systems (TPS) serve operational managers and staff, performing daily routine transactions necessary to conduct business.
- Enterprise Resource Planning (ERP) systems collect data from different firm functions and store data in a single central data repository, resolving fragmented data.
- Supply Chain Management (SCM) systems manage a firm's relationships with suppliers and share information about orders, production, inventory levels, and delivery.
- Customer Relationship Management (CRM) systems provide information to coordinate all business processes that deal with customers including sales, marketing, and customer service to better identify, attract, and retain profitable customers.
- Knowledge Management Systems (KMS) support processes for capturing and applying knowledge and expertise by collecting internal knowledge and experience.
- E-business uses digital technology and the internet to drive major business processes.
- E-commerce is a subset of e-business that involves buying and selling goods and services through the internet.
- E-government uses internet technology to deliver information and services to citizens, employees, and businesses.
Business Intelligence (BI) Systems
- BI systems are used to organize and analyze data to help managers and users make improved decisions.
- Types of BI Systems include Management Information Systems (MIS), Decision Support Systems (DSS), and Executive Support Systems (ESS)
Management Information Systems (MIS)
- MIS serve middle management, providing reports on firm's current performance, based on data from TPS.
Decision Support Systems (DSS)
- DSS serve middle management and support non-routine decision-making by using external information as well as TPS/MIS data.
Executive Support Systems (ESS)
- ESS support senior management, addressing non-routine decisions. They incorporate data about external events and summarize information from MIS and DSS systems.
Information Systems Function in Business
- The information systems department is the formal organizational unit responsible for information technology, often headed by a Chief Information Officer (CIO).
- Other senior positions include the Chief Security Officer (CSO), Chief Knowledge Officer (CKO), and Chief Privacy Officer (CPO).
- End users are representatives from other departments for whom applications are developed, and they increasingly play a role in system design and development.
- IT governance refers to strategies and policies for using IT in an organization, as well as decision rights, accountability, and the organization of the information systems function.
Information System Strategies to Deal with Competitive Forces
-
Align IT with business objectives
- Identify business goals and strategies
- Break down strategic goals into specific activities and processes
- Define metrics for measuring progress
- Determine how IT can support reaching business goals
- Measure actual performance to assess the effectiveness of the approach
Low-cost Leadership
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Use information systems to minimize operational costs and achieve the lowest prices
- Example: Walmart
- Inventory replenishment system automatically sends orders to suppliers when a purchase is made
- Minimizes warehouse inventory and operating costs
- Efficient customer response system
- Example: Walmart
Product Differentiation
-
Use Information systems to enable new products and services, or dramatically enhance customer experience with existing products and services
- Examples: Google's continuous innovations and Apple's iPhone
-
Use information systems to customize and personalize products to fit individual consumer specifications.
- Example: Nike's NIKE iD program for customized sneakers
Focus on Market Niche
-
Use information systems to serve a specific market niche and cater to a narrow target market better than competitors.
- Analyze customer buying habits and preferences
- Tailor advertising pitches to smaller and smaller target markets
- Example: Hilton Hotel's On Q System
- Analyzes data collected on guests to identify preferences and guest profitability
Strengthen Customer and Supplier Intimacy
-
Strong relationships with customers and suppliers increase switching costs and customer loyalty.
- Example: Toyota
- Uses information systems to enable direct access from suppliers to production schedules
- Allows suppliers to decide how and when to ship supplies to plants, providing more lead time for production
- Example: Amazon
- Tracks user preferences for purchases and recommends products based on the preferences of similar users
- Example: Toyota
Competitive Advantage using VRIO
- Valuable: Does it provide customer value and competitive advantage?
- Rareness: Do no other competitors possess it at the same level?
- Imitability: Do competitors have the financial resources and capabilities to imitate?
- Organization: Is the firm organized to exploit the resource efficiently?
Porter's Competitive Forces Model
-
Five forces shape the fate of companies:
- Traditional Competitors
- New Market Entrants
- Substitute Products and Services
- Customers
- Suppliers
Synergies, Core Competencies, and Network-Based Strategies
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Large corporations often consist of multiple business units
- Financial returns depend on the performance of individual business units
- Information systems can improve business unit performance by promoting communication, synergies, and core competencies
Synergies
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Outputs of some business units can be used as inputs for other units
- Example: Two firms pooling markets and expertise (recent bank mergers)
- Lower costs and generate profits
- Information systems can connect disparate units to function as a unified whole
Core Competency
-
Activities for which a firm is a world-class leader
- Example: World's best miniature parts designer, best package delivery service
- Relies on knowledge gained over years of experience, as well as research
- Information systems that encourage knowledge sharing across business units enhance competency
Network-Based Strategies
-
Network Economics
- The marginal cost of adding another participant is negligible, while the marginal gain is substantial
- Example: Internet: The more participants, the greater the value for everyone
-
Virtual Company
- Uses networks to connect people, resources, and partner with other companies to create and distribute products
- It operates without traditional organizational boundaries or physical locations
Disruptive Technologies
-
Technologies that have a transformative impact on industries and businesses, rendering existing products, services, and business models obsolete
- Examples: Personal computers, the World Wide Web, internet music services
-
First Movers versus Fast Followers
- First movers of disruptive technologies might fail to recognize their potential, allowing second movers (fast followers) to reap the benefits
The Internet and Globalization
- Before the internet, global competition was mainly for huge firms able to afford factories, warehouses, and distribution centers abroad
The Internet's Impact on Competitive Advantage
- Enables new products and services
- Increases the number of substitute products available
- Reduces the barrier to entry for new competitors
- Shifts the power balance between customers and suppliers
- Transforms entire industries
- Creates opportunities for new markets, brand building, and large customer bases
- Smart products and the Internet of Things
The Business Value Chain Model
-
Identifies specific activities in a business where competitive strategies can be best applied and where information systems are likely to have a significant impact
- Primary Activities
- Support Activities
- Benchmarking
- Best Practices
The Value Web
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A firm's value chain is linked to the value chains of its suppliers, distributors, and customers
- Value Web: A collection of independent firms that use information technology to coordinate their value chains and collectively produce a product
- Value webs are flexible and adaptable to changes in supply and demand
Business Process Management (BPM)
-
A systematic approach to managing and improving business processes
- It helps organizations to achieve greater efficiency, effectiveness, and agility
- It can be used to streamline processes, eliminate waste, and improve customer satisfaction
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Description
Explore the foundational concepts of business processes and their integration with information systems. This quiz covers functional business processes, enterprise applications, and the role of information systems in managing these processes efficiently. Test your understanding of how these elements work together in a business environment.
