Deck 3: Organizational Strategy, Information Systems, and Competitive Advantage

Question 1

A value chain (is)

A)describes the transactions that occur between the vendor and the consumer.
B)a group of activities that improve the efficiency of a good or service.
C)a group of activities that improve the effectiveness of a good or service.
D)describes how a product moves through a distribution channel.
E)describes total amount of money spent on making a product.

Answer 1

C

Question 2

Sustained competitive advantage requires

A)companies to find a distinctive way to compete.
B)the elimination of the dominant firm.
C)companies to seek patent protection for their products.
D)the creation of barriers of entry.
E)companies to use more than one competitive strategies.

Answer 2

A

Question 3

Which of the following is the best example of the bargaining power of suppliers?

A)The ability of a dominant microprocessor manufacturer to set industry standards and charge premium prices.
B)The inability for a customer to terminate a supply contract.
C)The ability of a customer to shop around for suppliers.
D)The customer's flexibility to switch suppliers at any time.
E)The ability to negotiate better terms with a commodity producer after a competitive bidding process.

Answer 3

A

Question 4

The difficulty in measuring productivity is largely due to

A)IT creating intangible benefits.
B)the intangible benefits of IT in an increasingly service -based economy.
C)an increasingly service -based economy.
D)the difficulty of measuring intangible benefits.
E)the lack of measuring tools.

Question 5

Which of the following can be best described as a disruptive technology?

A)Vulcanized rubber tires
B)Digital music players
C)Portable computers
D)Liquid Crystal Displays
E)Compact Discs

Question 6

The physically assembly of a notebook computer is considered to be

A)a support activity in a value chain.
B)a secondary activity in a value chain.
C)a value adding activity in a value chain.
D)a primary activity in a value chain.
E)a production activity in a value chain.

Question 7

The observed lack of productivity from IT investments is most likely the result of

A)continued drops in hardware prices.
B)the introduction of new technologies.
C)inflation.
D)measurement errors.
E)declining interest rates.

Question 8

A network of value -creating activities is called a

A)value network.
B)business strategy.
C)value chain.
D)competitive advantage.
E)primary value activities.

Question 9

Competitive ___________ refers to a significant and sustainable benefit to a company over its competition.

A)strategy
B)advantage
C)disintermediation
D)planning
E)commerce

Question 10

A company can fail to create competitive advantage by

A)creating barriers to entry.
B)adding technology to its business process.
C)establishing alliances.
D)establishing high switching costs.
E)creating a process that leads to innovative product development.

Question 11

___________would be an example of using an information system to gain competitive advantage.

A)Using PowerPoint for company presentations
B)Automating the general ledger system
C)Printing internal reports in color
D)Developing a web service to share information with a supply chain partner
E)Using instant messaging while at work

Question 12

In the context of Porter's five forces model,customer's bargaining power refers to

A)a customer's ability to drive product design.
B)a customer's ability to use a substitute product.
C)a customer's ability to negotiate better prices.
D)a customer's ability to take his/her business elsewhere.
E)all of the above.

Question 13

How can competitive advantage through IT be sustained?

A)Competitive advantage through IT cannot be sustained.
B)By using as much proprietary technologies as possible.
C)By integrating all value creation processes into one system.
D)By making all employees sign nondisclosure agreements.
E)By suing any competitor whom your firm suspect is copying its systems.

Question 14

The threat of new entrants in an industry is high when

A)entry and exit costs are low.
B)entry and exit costs are high.
C)exit costs are low.
D)entry costs are high.
E)entry costs are low and exit costs are high.

Question 15

IT investments can generate value by

A)creating more efficient and effective business processes that lead to lower prices.
B)limiting the opportunities for creating competitive advantages.
C)limiting the ways corporations can compete.
D)decreasing productivity.
E)creating larger and larger service based economies.

Question 16

Which of the following can create a barrier to entry?

A)Existence of dominant firms
B)Government regulation
C)Patents
D)Size of investment required
E)All of the above

Question 17

A supporting activity in a value chain is best described as

A)information technology related activities.
B)activities that support the primary activities in a value chain.
C)activities that add no value to a value chain.
D)activities that do not require manual labor.
E)maintenance related activities.

Question 18

The Productivity Paradox refers to

A)falling computer prices due to increased processor speed.
B)increased IT investment leading to more sustainable competitive advantage.
C)increased spending on IT leading to decreased worker productivity.
D)the lack of evidence of an increase in worker productivity associated with the massive increase in IT spending.
E)the evidence that suggests IT is irrelevant to worker productivity.

Question 19

High switching cost refers to

A)a strategy used by telecom providers to retain customers.
B)a strategy employed by companies to lock in customers by making it difficult or expensive to switch to another product.
C)an illegal tactic that prevents customers from leaving by charging a prohibitive service termination fee.
D)a strategy employed by companies to prevent customers from renegotiating service contracts.
E)a service charge that discourages customers from switching service providers.

Question 20

Receiving and storing raw materials for production would be an example of a(n)____________in Porter's value chain model.

A)linkage
B)complex activity
C)support activity
D)integrated activity
E)primary activity

Question 21

When sharing information with value chain partners,_________should be a major concern

A)strategy
B)complexity
C)security
D)accuracy
E)details

Question 22

Disruptive technologies refer to

A)technological innovations that increase the value of existing products in an incremental way.
B)technological innovations that set a new standard,like High Definition Television.
C)technological innovations that decrease the value of existing products.
D)technological innovations that repackage attributes of existing products in a totally new way.
E)technological innovations that cause major disruptions in IT operations.

Question 23

Which of Porter's five forces best describes the decline of film based photography?

A)Rivalry among existing firms
B)Bargaining power of customers
C)Threat of substitute products
D)Threat of new entry
E)Bargaining power of suppliers

Question 24

Which of the following is an example of a supporting activity in a value chain?

A)A bottle of wine being shipped to a warehouse
B)An accountant filing an income tax statement
C)Product safety tests
D)Assembling a product
E)Product package design

Question 25

Which of the following is an example of a primary activity in a value chain?

A)A computer technician backing up a file server
B)An accountant preparing an income statement
C)A manager preparing a production schedule
D)A CFO preparing a budget
E)A worker spray painting a car

Question 26

What prompted Robert Solow to make the quote,"We see computers everywhere except in the productivity statistics"?

A)The productivity gap
B)The productivity divide
C)The digital divide
D)The efficiency paradox
E)The productivity paradox

Question 27

In "IT doesn't Matter",Nicholas Carr argues that

A)companies are spending too much money on IT.
B)there are no productivity gains for any amount of IT investments.
C)technology adds no value to companies.
D)disruptive technologies tend to be commoditized over time and hence provides less strategic advantage.
E)the marginal benefits of an IT investment decreases over time.

Question 28

Ideally,a competitive advantage should be

A)industry -wide.
B)shared with partners.
C)reproducible.
D)short term.
E)sustainable.

Question 29

Porter's model of the value chain and its linkages started a movement to create __________cross -departmental business systems.

A)linked
B)primary
C)complex
D)supporting
E)integrated

Question 30

Which of the following makes it difficult for a company to copy a rival's information systems?

A)It is difficult to duplicate business processes.
B)It takes a long time for a company to master the art of integrating technology and people.
C)The data is different in the two organizations.
D)Talent is hard to recruit.
E)Technology may not be available for sale.

Question 31

Finding a vendor and negotiating a price for raw materials for production would be an example of a(n)_________in Porter's value chain model.

A)primary activity
B)support activity
C)integrated activity
D)complex
E)linkage

Question 32

In Porter's view of the value chain_________are important sources of efficiencies that are readily supported by information systems.

A)competitive advantages
B)strategies
C)linkages
D)connections
E)associations

Question 33

A company can use products to create competitive advantage by

A)differentiating its products.
B)raising prices.
C)adding products to its product line.
D)increasing brand awareness.
E)lowering prices.

Question 34

Margin can be defined as

A)the difference of the price a customer is willing to pay and how much the company actually collects.
B)the difference of the price a customer is willing to pay and the price a seller is willing to sell at.
C)the difference between the selling price and the list price.
D)the difference of the price a customer is willing to pay and the cost of moving the good or service through its value chain.
E)the difference between the total cost of raw materials and the list price of a product.

Question 35

Information systems can change industry structure by

A)using technologies that have become commodities.
B)using competitive strategies.
C)using the Internet.
D)using sustaining technologies.
E)using disruptive technologies.

Question 36

Which of the following best describes Bower and Christensen's idea of a sustaining technology?

A)A technology innovation that maintains the rate of improvement in customer value.
B)A technology innovation that decreases the rate of improvement in customer value.
C)A technology innovation that increases the rate of improvement in customer value.
D)A technology innovation that ensures environmental sustainability.
E)A technology innovation that provides a very new package of attributes from the accepted mainstream products.

Question 37

A primary activity in a value chain is best described as

A)an activity that requires the use of information systems.
B)an activity which value is directly added to a product.
C)the first activity in which value is created.
D)an activity that uses only raw materials.
E)an activity that involves customer service and sales.

Question 38

"Doing the right things" refers to

A)effectiveness.
B)social responsibility.
C)efficiency.
D)sustainability.
E)improved quality.

Question 39

Increasing efficiency means

A)shorter production times.
B)higher speed processes at the cost of more resources and lower quality.
C)minimizing the cost of production.
D)generating better quality products with less resources.
E)generating more output with less input at higher speeds.

Question 40

Each value chain consists of one or more

A)linkages
B)partners.
C)activities.
D)systems.
E)processes.

Question 41

A strategic_________ with other organizations can be used to establish standards,reduce purchasing costs,and jointly promote products.

Question 42

Companies want to create_______in order to lock in their customers.

Question 43

_________technologies are changes in technology that maintain the rate of improvement in customer value.

Question 44

_________is an example of a primary activity in Porter's value chain model.

A)Accounting
B)Shipping and receiving
C)Strategic planning
D)HR planning
E)New IS development

Question 45

Which of the following best describes the introduction of a disruptive technology in Canada?

A)The introduction of digital projection in theatres
B)The introduction of movies on DVDs
C)The introduction of high definition TV
D)The introduction of Automatic Teller Machines
E)The introduction of satellite radio

Question 46

Which of the following can be considered a sustaining technology?

A)MP3 file format
B)A typewriter
C)A Sony Discman
D)A BlackBerry device
E)A photocopier

Question 47

When a firm like Bell offers free anti -spam protection to their customers,they are trying to gain a competitive advantage by _________ their customers.

Question 48

"Doing things right" refers to

A)efficiency.
B)sustainability.
C)effectiveness.
D)value creation.
E)social responsibility.

Question 49

Organizations can lock in customers by making it difficult or expensive for customers to switch to another product.This is called establishing_________ .

Question 50

If I show a prospective employer that I have a unique set of skills that are especially suited to the job opening that they have,I am demonstrating that I have a(n)_________ over other candidates.

Question 51

_________is an example of a support activity in Porter's value chain model.

A)Payroll management
B)Goods production
C)Warranty service
D)Finished goods inventory management
E)Raw material acquisition

Question 52

The increasing reliance on the web for information has created a(n)_________ between those who have Internet access and those who do not.

Question 53

A(n)_________chain is a network of activities that improve the effectiveness of a good or service.

Question 54

_________is an example of a support activity in Porter's value chain model.

A)Raw materials acquisition
B)Sales
C)Production
D)Customer service
E)HR benefits management

Question 55

Which of the following is not a force in the Porter's five forces model?

A)Threat of new entries
B)Threat of substitute products
C)Bargaining power of suppliers
D)Bargaining power of customers
E)Threat of government regulations

Question 56

An innovative shipping information system for Canada Shipping helps to_________ its package delivery service from competitors that do not have a similar system.

Question 57

Which of the following is a fundamental competitive strategy suggested by Porter?

A)Creating alliance partners
B)Developing innovative products
C)Providing the best customer service
D)Differentiating its products to become a niche player
E)Growing the diversity of the products and/or service offered

Question 58

The network of activities that improve the effectiveness of a good or service is called

A)a value chain.
B)a value web.
C)a supplier network.
D)a supply chain.
E)competitive strategies.

Question 59

Porter's five competitive forces include new vendors,suppliers,substitute vendors,customers and

A)efficiency of production.
B)rivalry of firms.
C)marketing.
D)finance.
E)economic pressures.

Question 60

___________are difficult and expensive to enforce.

Question 61

The systems chosen to support a particular competitive strategy are evaluated according to the margin they give that strategy.

Question 62

The difference between the price the customer is willing to pay and the cost the company incurs in moving the goods or services through the value chain is called the __________.

Question 63

__________ of innovation is a way of thinking about the adoption of new technologies.

Question 64

Persuasion is a stage in ______.

Question 65

An organization responds to the structure of its industry by choosing a(n)__________.

Question 66

A system that reduces __________ for a company can result in significant competitive advantage.

Question 67

When FedEx developed the package tracking application,they were trying to gain competitive advantage through IT ___________ .

Question 68

Switching costs are those associated with network switches.

Question 69

An entry barrier makes it more__________ for new competition to enter the market.

Question 70

Organizations can gain competitive advantage by reducing__________ .

Question 71

Everett Rogers defined __________ as the process by which an innovation gets communicated to members of a social system.

Question 72

__________ technologies introduce a very new package of attributes to the accepted mainstream products.

Question 73

According to Nicholas Carr the more __________ a technology the less competitive advantage it offers.

Question 74

Companies that make it difficult or expensive for customers to change to another product are establishing high__________costs for their customers.

Question 75

__________activities are activities where value is added directly to the product.

Question 76

The__________ stage in the diffusion of innovation happens when considering the pros and cons of purchasing an iPhone.

Question 77

__________is the way companies gain an edge over other companies seeking the same customers.

Question 78

In a large city,the threat of new entrants for the sandwich shop business is probably high.

Question 79

If I use my time in school to create new skills,enhance the ones I have,and differentiate my skills from others,I am developing my __________.

Question 80

By providing customers with the addresses and easy e -mail access between senders and receivers,a shipping company can reduce their customers' costs and___________ customers to their services.