1. Which of the following is not a mediating factor that impacts an organization’s relationship with information technology?
A) Agency costs
2. Which of the following statements about strategic information systems is not true?
A) Almost all a business firm’s profits can be explained by alignment of IT with business.
3. The expenses incurred by a customer or company in lost time and resources when changing from one supplier or system to a competing supplier or system are known as:
A) switching costs.
4. When two organizations pool markets and expertise that result in lower costs and generate profits, they are creating:
A) synergies.
5. ________ is a competitive strategy for creating brand loyalty by developing new and unique products and services that are not easily duplicated by competitors.
A) Product differentiation
6. In the value chain model, support activities are most directly related to the production and distribution of the firm’s products and services, which create value for the customer.
A) False
7. Information systems can be used at the industry level to achieve strategic advantage by:
A) building industrywide, IT-supported consortia, symposia, and communications networks.
8. When the output of some units in a firm can be used as inputs to other units, synergies develop, which can lower costs and generate profits.
A) True
9. In network economics, the value of a commercial software vendor’s software products:
A) increases as more people use them.
10. Why does Amazon need to worry about competitors in online shopping?
A) Internet technologies are universal, and therefore usable by all companies.
11. All of the following are IT-enabled products and services providing competitive advantage except:
A) Nike’s use of celebrities to market their products.
12. Information systems are used to enable new products and services via product differentiation.
A) True
13. A firm can exercise greater control over its suppliers in terms of price, quality, and delivery schedules by having:
A) more suppliers.
15. Smart products increase rivalry among firms.
A) True
16. Firms use a ________ strategy to provide a specialized product or service for a narrow target market better than competitors.
A) market niche
18. Under Mintzberg’s classification of organizational structure, knowledge-based organizations fall under the category of:
A) professional bureaucracies.
19. Mass customization offers individually tailored products or services using the same resources as mass production.
A) True
20. All of the following could be considered substitute products for industrial electricity generation except:
A) ethanol