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Melissa Hinton

CINS 3050

Ch. 2 Review Questions

1. Compare and contrast the characteristics of the operation, managerial, and executive levels of an organization.

a. Operational level- This is there the routine, day-to-day business processes and interactions with customers occur. Information Systems at this level are designed to automate repetitive activities. Structured Decisions: are those in which the procedures to follow for a given situation can be specified in advance. Since these decisions are so straightforward, they can be programmed into operational information systems to avoid human intervention.

b. Managerial level-At the managerial level, functional managers (Marketing managers, finance managers, etc.) focus on monitoring and controlling operational-level activities and providing information to higher levels of the organization. They focus on effectively utilizing and deploying organizational resources to achieve the objectives of the organization. Semi-Structured Decisions: some procedures to follow for a given situation can be specified in advance but not to the extent where a specific recommendation can be made. Key Performance Indicators (KPI's): The metrics deemed most critical to assessing progress toward a certain goal. Typically displayed on a performance dashboard.

c. Executive level- Managers focus on long-term strategic questions facing the organization. (ex. Which products to make and which countries to compete in.) Executive level decisions deal with complex problems with broad and long-term ramifications for the organization. Unstructured Decisions: few or no procedures to follow for a given situation can be specified in advance.

2. Compare and contrast automating and learning.a. Automating- Someone with an automating mindset thinks of technology as a way to

help complete a task within an organization faster, cheaper and with greater accuracy.b. Learning- An organization that is skilled at creating, acquiring, and transferring

knowledge and at modifying its behavior to reflect new knowledge and insights.3. Describe the attributes of a learning organization. One that is skilled at creating, acquiring, and

transferring knowledge, and at modifying its behavior to reflect new knowledge and insights.4. List five general types of organizational strategy.

a. Broad differentiationb. Focused differentiationc. Focused low-cost leadershipd. Overall low-cost leadershipe. Best-cost provider

5. Describe competitive advantage and list six sources. Competitive advantage is a firm’s ability to do something better, faster, cheaper, or uniquely when compared with rival firms in the market.

a. Quality

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b. Servicec. Low Costd. Innovatione. Brandf. value

6. Describe the multi-domestic business strategy and how it affects the flow of control information. The multi-domestic business strategy is particularly suited for operations in markets differing widely. The multi-domestic business strategy uses a loose federation of associated business units, each of which is rather independent in their strategic decisions. Data and control can flow in any direction, depending on the specific business process.

7. Why is successful application of innovative technologies and systems often difficult? a. The advantages gained from innovations are often short-livedb. Riskyc. Foreseeing the future is not always possibled. Process requirementse. Resource requirementsf. Risk tolerance requirements

8. What is the “innovator’s dilemma”? The notion that disruptive innovations can cause established firms or industries to lose market dominance, often leading to failure.

9. Using past examples, explain what is meant by a disruptive innovation. New technologies, products, or services that eventually surpass dominant technologies.

a. 1970’s: mid- and high- performance users were bulk of the marketi. DEC tied to sell to those markets

ii. Micro pc’s seen as toysb. 1980’s: micro pc’s focused on low-performance users’ needs/Ignored by DECc. 1990’s: Growing performance of micro pc’s, meeting mid-performance users’ needs.

DEC lost biggest market segmentd. Online vs. brick-and-mortar retailinge. Automobiles vs. horsesf. CD’s vs. recordsg. MP3 vs. CD’s

10. Describe the e-business innovation cycle. This model suggests that the extent to which modern organizations use information technologies and systems in timely, innovative ways is the key to success.

11. What is freeconomics, and what are several approaches for applying its concepts to various industries? Freeconomics is the leveraging of digital technologies to provide free goods and services to customers as a business strategy for gaining competitive advantage.

a. Advertising-Free services provided to customers and paid for by a third party. ex: yahoo’s banner ads

b. Freemium-Basic services are offered for free. ex: skypec. Cross-Subsidies-Sale price of one item is reduced in order to sell something else of

value. ex: free wii for those willing to buy 5 new gamesd. Zero Marginal Cost-Products are distributed to customers without an appreciable cost

to anyone. ex: video content on YouTube

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e. Labor Exchange-Services are provided to the customers; the act of using the services creates value for the company. ex: Google’s 411 service

f. Gift Economy-Environments are created that allow people to participate and collaborate to create something of value for everyone. ex: Wikipedia