Chapter 2: The Role of Information Systems in Business Today

IT systems help improve data accuracy, leading to slower operations and increased costs.

IT enables real-time tracking of inventory and facilitates collaboration with suppliers for better logistics and supply chain management.

IT tools do not support computer-aided design (CAD), simulation, and prototyping in product development.

E-commerce and digital platforms are not facilitated by IT systems.

Companies do not invest heavily in IT systems to gain a competitive edge.

IT does not help businesses gather data on customer preferences or identify market trends.

Hilton Hotels' OnQ system analyzes general data collected on guests to determine their preferences and profitability.

Automobile manufacturers like Toyota and Ford use information systems to restrict access by suppliers to production schedules.

Just-in-time production allows parts for automobiles to arrive at the factory after they are needed by assembly lines.

Information systems at distributors and retailers can recommend items purchased by others to its customers.

Strong links to customers and suppliers decrease switching costs and customer loyalty.

Most companies focus on only one strategy in customer and supplier intimacy.

Passengers have limited airline options, making it difficult to switch airlines for better deals or service.

Switching costs for passengers are relatively high due to long-term contracts and significant investments required to change airlines.

Passengers have limited access to online travel platforms and comparison tools to compare prices and offers across different airlines.

Airlines face low switching costs when changing aircraft suppliers.

Aircraft suppliers have specialized knowledge and technology, making it easy for airlines to vertically integrate backward into aircraft manufacturing.

High capital requirements and technological barriers to entry in the aircraft manufacturing industry weaken the bargaining power of suppliers.

Airlines primarily focus on capacity management to minimize profitability and maximize excess capacity.

The airline industry's competition is limited to airfares and does not extend to other areas.

The threat of new entrants in the airline industry is relatively low.

The commercial airline industry experiences low buyer power compared to other competitive forces.

Information systems play no role in helping firms deal with competitive forces in the airline industry.

To maintain profitability, airlines need to continuously adapt and innovate due to the intense rivalry among competitors.

Value webs are more linear in operation than traditional value chains.

MIS plays a minimal role in facilitating systems thinking within organizations.

Each part of a business, such as departments or processes, in a complex system does not impact the others.

MIS empowers businesses to make uninformed decisions due to its comprehensive data analysis capabilities.

Industry-wide standards for exchanging information do not increase efficiency in business transactions.

IT systems do not enable real-time tracking of inventory for better logistics and supply chain management.