WEEK 1 provided for COIS20024, CQUniversity

Copyright 2011 by The McGraw-Hill Companies, Inc. All rights reserved.

Foundations of Information Systems in Business

1. How can information technology support a companys business processes and

decision making and give it a competitive advantage? Give examples to illustrate
your answer. Support: Information technology can automate manual process such as
document transmission. Instead of writing memos or letters, employees can compose
and send e-mails electronically. Information technology can also facilitate the
reengineering of entire business processes. For example, the airlines industry
relies heavily on online ticket booking. Not only does this facilitate filling
seats, but it also provides them with a valuable information about passengers which
they can repackage for sale to business partners in the form of "frequent flier"
programs. Competitive advantage: product innovations or cost savings program can
provide a product or price advantage over competitors that lasts until competitors
catch up. Though the advantage may be fleeting, the boost to an organization's
image may be longer lasting.

2. How does the use of the Internet, intranets, and extranets by companies today
support their business processes and activities? Internet: organization can connect
directly with the general public. Opportunities range from giving away basic
product information to automatically updating or patching retail software. Many
businesses also conduct retail operations online. Intranets: organizations often
use internet technologies to facilitate operations within the organization. Such
systems might include product support knowledge bases, training systems, and access
to the organisation's benefits system. Extranet: organizations may use these same
internet technologies to connect with their business partners to facilitate supply
chain management, help manage projects, manage accounts, or provide advanced
technical support. Organizations use internet technologies to connect with both
customers and suppliers. These technologies allow customers to generate and track
their own orders as well as manager their accounts. They also enable significant
supply chain automation

4. Why do big companies still fail in their use of information technology? What
should they be doing differently? Top Five Reasons for Success User involvement
Executive management support Clear statement of requirements Proper planning Top
Five Reasons for Failure Lack of user input Incomplete requirements and
specifications Changing requirements and specifications Lack of executive support
Page 1 of 8
WEEK 1 provided for COIS20024, CQUniversity

Realistic expectations

Technological incompetence

Certainly the reasons listed in the table above could explain some of the major
causes of why companies fail in their use of information technology. However, it is
important to note that the field of technology is changing at such a rapid pace
that many large and successful companies are having difficulty keeping up with it.
Other ideas may include such things as a shortage of skilled employees, the major
expense involved in managing and developing systems, and a rapidly changing
business regulatory environment. 5. How can a manager demonstrate that he or she is
a responsible end user of information systems? Give several examples. There are two
sides to this answer. First, managers must make good use of information resources
placed at their disposal. Second, managers must not use their information systems
irresponsibly. Student's answers may vary depending on how they interpret this
question. Responsible use: Managers should demonstrate that they are using their
information systems as intended. In the case of e-mail, calendar, scheduling, and
collaborative systems, other users would notice a manager's lack of participation.
They would find it difficult to communicate or schedule meetings with non-
participating managers. These managers would increasingly find themselves "out of
the loop". Instead, managers should incorporate these tools into their daily
habits. To demonstrate appropriate use of other information systems, managers
should ensure they receive the appropriate training for these various applications.
This would include using data and analysis tools in order to make more informed
business decisions. High quality decisions based upon the information these systems
provide would demonstrate that these assets are not being wasted. Inappropriate
use: As a manager or other end user of information, we must insure that we always
consider the ethical responsibilities of the use of information. Irresponsible
uses: accessing and/or selling data for personal gain failing to protect data
from loss or theft violating privacy laws or abusing community privacy
expectations 8. Why are there so many conceptual classifications of information
systems? Why are they typically integrated in the information systems found in the
real world? Conceptual classifications of information systems are designed to
emphasize the many different roles of information systems. This can be done from
various points of view, such as the level of management that the information
systems serve, or the business functions they support. In practice, these roles are
not always clearly divided, and in any case, information produced by one business
activity may serve as input data to another activity. Thus it makes sense to
integrate various roles into one information system. 9. In what major ways have
information systems in business changed during the last 40 years? What is one major
change you think will happen in the next 10 years? Refer to Figure 1.4 to help you
answer. History: Tabulation (pre 1950s) Data processing (1950s-1960s)
Management reporting (1960s-1970s) Decision support (1970s-1980s) Strategic end
user support (1980s-1990s) Enterprise and global internetworking (1990s-2000s)
eBusiness (2000s-2010s) Social networking (2010s-current) Future: User
authentication Virtual machines Cloud computing Page 2 of 8
WEEK 1 provided for COIS20024, CQUniversity

Solid state drives Overhaul of computing legislation Integration of video, audio,

images, GPS, networks into entirely new products and services. Biometric computing
Monitoring and control systems embedded into the human body (for example, insulin
injectors, ID chips)

RWC 3: Sew What? Inc.: The Role of Information Technology in Small Business Success
Case Study Questions 1. How do information technologies contribute to the business
success of Sew What? Inc.? Give several examples from the case regarding the
business value of information technology that demonstrate this conclusion.
Examples: Expanded market - Duckett was able to grow her business from local to
international clients using her website. Customer education - the website helps
her educate her customers about curtain design. Customer service - the website
allows customers to more easily match materials, select colors, and learn about her
product's "care and feeding." Cost accounting - Duckett tracks production
workflows and more accurately calculate costs. Business process reengineering -
workflow information helps identify useful process changes and provides feedback to
help Duckett evaluate the results.

2. If you were a management consultant to Sew What? Inc., what would you advise
Megan Duckett to do at this point to be even more successful in her business? What
role would information technology play in your proposals? Provide several specific
recommendations. The article provides no information about Duckett's current
challenges, though recommendations should focus on them. In general, Duckett should
give scalability and flexibility significant consideration when making future IT
decisions. Her reputation may lead to continued growth and/or expansion into new
areas. She will not want to find herself limited by her own information systems.
Lastly, Duckett should not get too carried away with industry prizes. While it's
great to get a pat on the back now and then, the real prize is profitability.
Profitability turns into big annual bonuses and pats on the back from people she
cares about the most, her employees. 3. How could the use of information technology
help a small business you know be more successful? Provide several examples to
support your answer. Organizations don't want information systems, they are
expensive and distracting. However, organizations usually need information systems
in order to accomplish specific goals. Answers should focus primarily on those
goals and how the proposed system will help. For example, a car mechanic would want
to ensure he or she meets her quota of billable hours. By keeping a customer
database with vehicle maintenance schedules, the mechanic can contact customers and
schedule them for routine service during anticipated slack times. Real World
Activities 1. Search the Internet to help you evaluate the business performance of
Sew What? Inc. and its competitors at the present time. What conclusions can you
draw from your research about Sew What?'s prospects for the future? Report your
findings and recommendations for Sew What?'s continued business success to the
class. Marketplace: Sew What? operates in a highly competitive market. Competitors
include: Page 3 of 8
WEEK 1 provided for COIS20024, CQUniversity

ShowBiz Enterprises, Inc. 1 Rose Brand2 Universal Stars Incorporated3 Gerriets

International4

Findings: Sew What?'s competitors offer a spectrum of products far broader than
just curtains. If customers prefer a one-stop solution for their staging needs,
then they would not consider Sew What? as a potential vendor. Therefore, Duckett
should consider expanding her company's product line. 2. Small businesses have been
slower to integrate information technology into their operations than larger
companies. Break into small groups with your classmates to discuss the reasons for
this state of affairs, identifying several possible IT solutions and their business
benefits that could help small businesses be more successful. Reasons: Most small
companies are focused on their survival and don't have time to plan for the long
term. Smaller companies have proportionally smaller IT budgets. Many
information technology solutions require considerable startup costs, steep learning
curves, and long payback periods. Solutions: ASP application suites reduce
start-up costs because the software is leased rather than purchased. Small
businesses should ensure they hire people who are IT literate. These people would
require less training when the business get around to implementing new technology,
and the best of them may even be able to take a leadership role in training other
users and in helping acquire appropriate systems. Ensure IT purchases are scalable.
For example, Salesforce.com provides an automated upgrade path. Other vendors
charge per user and feature rather than tiered fees.

1 2

http://www.theatricaldrapery.com/ http://www.rosebrand.com/ 3
http://www.ledstarcloth.com/ 4 http://www.gi-info.com/ Page 4 of 8
WEEK 1 provided for COIS20024, CQUniversity

Competing with Information Technology

1. Suppose you are a manager being asked to develop computer-based applications to

gain a competitive advantage in an important market for your company. What
reservations might you have about doing so? Why? Unless the individual is familiar
with the tools and processes involved in developing information technology
applications, they will have a high level of apprehension. Reservations would
include the fear of being out of one's depth and feelings of helplessness,
insecurity, and dependence on others. The individual may also wonder whether or not
an appropriate application might be obtained off the shelf. Off the shelf software,
though not easily customizable, generally costs less than custom software
development. Lastly, he or she might also feel concerned about how the software may
affect their position within the organization. Change isn't easy, and if it isn't
supported at the very top management levels, it may fail due to lack of
organizational will, and this failure would look bad on their performance review.
2. How could a business use information technology to increase switching costs and
lock in its customers and suppliers? Use business examples to support your answers.
Switching Costs A business might undertake projects to integrate some of its
information systems with its customers' systems in order to provide them with more
timely, accurate, and useful information. The business might even provide
applications for its customer's use at low or no cost. Customers later considering
changing suppliers would lose these benefits. Indeed, the very process of
developing these tools will help managers increase their familiarity with their
customers and allow them to tune their information resources to their customer's
needs. This relationship will further serve to lock in customers. Examples For
example, Fed Ex provides its customers with package tracking information. Medical
supply companies provide hospitals with inventory management and re-ordering
systems. Wal-Mart will soon provide small medical practices with reduced cost
patient management systems. 3. How could a business leverage its investment in
information technology to build strategic IT capabilities that serve as a barrier
to new entrants into its markets? Businesses may leverage its IT platforms by
connecting them with their customers and suppliers to provide better
communications. Initially, both the company and the customer benefit from the new
system. However, as time goes by the customers will tend to integrate these systems
into their own core processes thereby becoming dependent on the platform. In the
long run, the companys investment in IT results in locking in their customers and
suppliers and creating switching costs. The high costs associated with developing
these systems serve as barriers to entry for competitors. 5. What strategic role
can information play in business process reengineering? Information plays a
critical role in BPR initiatives. First, information about existing operations
serves as a baseline for future comparison. Second, as new processes take shape,
information in the form of feedback allows managers to evaluate and control these
new processes. Lastly, the organization may find ways to repackage this information
for its customers' use. 6. How can Internet technologies help a business form
strategic alliances with its customers, suppliers, and others? Information
technology can help a business form strategic alliances with its customers,
suppliers, and others by enabling communications, collaboration, and information
sharing in ways that were never before possible. By Page 5 of 8
WEEK 1 provided for COIS20024, CQUniversity

virtue of working together online, managers can monitor and automatically capture
process metrics, identify bottlenecks, and recommend process improvements within
and between organizations. 7. How could a business use Internet technologies to
form a virtual company or become an agile competitor? Virtual company: Example: a
person or company could use the Internet to acquire customers and then farm out the
work to suppliers. A simple example of this can be found managing contractors. A
company solicits customers for contract work (customers) and then solicits reliable
contractors who can do this work (suppliers). In exchange for a share in the
contractor's earnings, the virtual company handles the billing and customer
relations. It manages its reputation by monitoring the quality of the contractor's
work. High performing contractors retain a larger percentage of their earnings, and
low performing contractors are not invited to work on future contracts. Some
software vendors now lease (or provide for free) web enabled business software to
manage accounting, customer relations management, and office automation tasks (word
processing, spreadsheets, calendaring, and e-mail). As a result, a truly virtual
company need only a computer connected to the Internet and a web browser. Visit
rentacoder.com for a reverse auction site version of this enterprise. Agile
competitor: In addition to monitoring the marketing for business intelligence, an
agile competitor might implement an Internet based system that allows its customers
to configure their own products. For example, Dell allows its customers to
configure computers to their own specifications to include type of CPU,
motherboard, I/O devices, memory, monitor, and more. T-shirt and bumper sticker
companies might allow customers to upload their own custom designs or work
interactively with their own graphic designers to create a suitable product.

RWC 2: For Companies Both Big and Small Case Study Questions 1. In which ways do
smartphones help these companies be more profitable? To what extent are
improvements in performance coming from revenue increases or cost reductions?
Provide several examples from the case. Profitability: Reduced time it takes to
close a purchasing deal Reduced inventory levels Increased customer
satisfaction Increased employee satisfaction Reduced service call time and
costs Improvement source: Performance improvements primarily stem primarily from
cost savings. However, we might also infer revenue increases from satisfied
customers and fewer lost opportunities.

Examples: Better communications enable improved field support with fewer personnel
required to fix a problem and the reduced time it takes to close a service call
Better communications reduced the time it takes to close procurement deals. This
has resolved in lower inventory levels and reduced inventory holding costs. We
could also infer that this results in fewer lost sales opportunities and better
purchasing terms, too. Improved employee satisfaction employees have access to
the resources they need to do good work. Improved customer satisfaction service
calls are resolved more quickly thus reducing the impact on their business.

Page 6 of 8
WEEK 1 provided for COIS20024, CQUniversity

2. The companies described in the case encountered a fair amount of resistance from
employees when introducing smartphone technologies. Why do you think this happened?
What could companies do to improve the reception of these initiatives? Develop two
alternative propositions. Employee resistance - CPS: management could not visualize
the value these devices would provide. Employee resistance Lloyd's Construction:
employees were not technically savvy and required significant training. Though not
directly mentioned, the case also implied that employees may have resisted these
devices because they performed like workplace monitoring tools. Resistance causes
CPS: without first-hand experience or a clear vision, it's easy for management to
discount the benefits and magnify the risks. Resistance causes Lloyds
Construction: the case does not explicitly state that Lloyd's employees likely have
very low levels of formal education. However, students can reasonably infer this
from their job titles. It's also against human nature to welcome new restrictions
on one's freedom. Potential solutions: given the successes experienced by both CPS
and Lloyd's Constructions, students should learn from their example: Implement
small, low cost, low risk pilot projects to demonstrate the technology's value
Provide a full range of employee training programs Employ a parallel
implementation strategy to give employees time to learn the new systems while
minimizing the impact of any failures Other feasible recommendations: Adjust the
employee evaluation system to include a section on technology use Adjust the
compensation system so employees benefit from cost savings Provide "coaches" or
"mentors" in addition to a help-desk during implementation Advertise/recognize
early successes 3. CPS Energy and Lloyds Construction used smartphones to make
existing processes more efficient. How could they have used the technology to
create new products and services for their customers? Include at least one
recommendation for each organization. The main point of this question is "how", but
students may well focus on "what" instead. On the "how" side, both organizations
may create new products by providing their customers with access to these systems.
This access may take the form of "read" access. FedEx installed a "read" access
system for its customers. This system allowed customers to track a package's
delivery status. These organizations may also provide read/write access. Example
applications might include order entry, account management, or even collaborative
interaction. CPS Energy might consider making its experts (or just their expertise)
available online. This would enable their customers to attempt to solve their own
problems or escalate a request to CPS' own experts. These experts could then access
and assess the request's entire history. This may allow them to help solve the
problem online or at least better prepare for the onsite service call.

Lloyd's work is done on a project by project basis. Lloyd's could use their systems
to provide their general contractor (the contractor responsible for managing all
the individual contractors) with project status information (site surveys, various
permits, etc), schedule coordination, and expense reporting. These systems might
also be used to demonstrate compliance with local and federal regulations such as
hazmat handling or equal opportunity employment directives. Real World Activities
1. In addition to the companies featured in the case, others like FedEx and UPS,
which have large mobile workforces, heavily use mobile communication technologies.
What other companies could benefit from these innovations? Search Terms: "mobile
workforce automation" + "case studies" A few examples: Page 7 of 8
WEEK 1 provided for COIS20024, CQUniversity

Full service car rental agencies such as Alamo, Avis, Hertz, and National. Utility
companies (meter readers) The trucking industry (any shipping and delivery company)
The U.S. Census bureau Onsite market researchers Hospitals

2. Go online and research uses of smartphones in industries different from the ones
reviewed here. Prepare a report to share your findings. Search Terms: "mobile
workforce automation" + "case studies" 3. Use the Internet to research the latest
technological developments in smartphones, and discuss how those could be used by
companies to deliver value to customers and shareholders. Search Terms:
"smartphone" + "case studies". Searching a news aggregator like Google News would
provide the most current developments.5 Current developments include: Security
and mobile banking Mobile journalism's impact Android O/S Competitor/product
analysis

For example http://news.google.com/ Page 8 of 8