MIS Exam 2

Why do ad networks appeal to advertisers? Why do they appeal to content providers?

They appeal to advertisers because Google lines up the advertisers, provides the targeting technology, serves the ads, and handles the advertiser payment collection. They appeal to content providers because they can just sign up online, put a bit of Google supplied HTML code on their pages, and wait for Google to send them cash.

Why do ad networks appeal to advertisers? Why do they appeal to content providers? What functions are assumed by the firm overseeing the ad network?

They appeal to advertisers because Google lines up the advertisers, provides the targeting technology, serves the ads, and handles the advertiser payment collection. They appeal to content providers because they can just sign up online, put a bit of Google supplied HTML code on their pages, and wait for Google to send them cash. Some functions are that firms need to be very efficient and be able to handle the payments.

Why did SDCS choose to implement a "human resource management" module as a starting point?

They decided to implement a human resource management module because it was the module that needed the least modification. The head of the HR department also had success in implementing another ERP system. By implementing this system, it would also give IT staff experience in deploying the new software. The district intends to implement a full ERP system, but planned to start with an HR module to mitigate the risk. The HR module would require the least modification and would give the districts information ecology (IT) staff valuable experience in deploying a major new capability.

What are some of the sources data aggregators tap to collect information?

They use real estate, census reports, credit card applications, etc. They also have profiles of 200 million americans.

In what other ways do Amazon's information systems reduce errors? Why is error reduction so critical to firm performance?

Through chaotic storage, Amazon is able to use technology to track every item and its location. During picking and packaging, Amazon is able to pack the actual weight rather than the predicted weight, and they're able to route the best possible way of delivery. Since customer service is really important to Amazon, it's important the firm keeps its errors to a minimum.

What are the potential data sources for an organization?

Transaction processing system, enterprise software, survey, and external sources such as your partners, social media, and data aggregators.

What can hackers do with computers infected with Trojan horses? Understand how botnets or zombie networks are formed.

A hacker can get access to the machine remotely and use it to perform various functions such as data theft, manipulating files, monitoring the screen. Botnets/Zombies are formed by linking multiple computers so that none can be traced back to the main hack source.

Understand the key drivers for online ad growth. How can advertisers provide you targeted ads? What is a cookie? How are cookies used?

Advertisers can provide you targeting ads by figuring out your browsing history. A cookie is a line of identifying text, assigned and retrieved by a given Web server and stored by your browser. Once you accept the cookie, the web server starts to build your browsing profile.

What are Amazon's three major competitive advantages? How do these advantages reinforce with each other? Does Amazon create a two-sided market and if yes, how does this contribute to its wide selection of products?

Amazon has large selection, low prices, and high customer experience. The large selection with low prices pushes more traffic on Amazon and improves customer experience. Amazon has a two-sided market which contributes to its wide selection of products because they have a greater bargaining power of suppliers on prices and selection. Their low cost structure allows for lower prices and a greater customer experience which generates a cycle of buyer-seller growth.

Why are grocery stores attractive for Amazon? In what ways is Amazon entering the grocery business?

Amazon is entering the grocery business through AmazonFresh because of industry experience, trained workforce, and overlapping customer base.

Be able to describe the differences in Amazon's operating income between its retailing business and its AWS and understand why you see such differences.

Amazon makes 400 billion in retail and 600 billion in AWS. AWS, streaming users pay amazon a lot (Netflix), and they also get return from investors.

How does Amazon use technology to improve its operations efficiency and customer experience?

Amazon uses one click ordering, customer reviews, recommendations, bundles, look and search inside the book, and free super saving shipping, and amazon prime to improve its operations efficiency and customer experience.

How does Amazon use customer-related data to create greater customer experience? What is A/B test?

Amazon uses product reviews and browsing/purchasing history. The A/B test is a randomized group of experiments used to collect data and compare performance among two options studied.

What could be the potential contributing factors for Amazon's low/negative net income between 2006 and 2015? Why do we see a significant increase in its net income in the last few years?

Amazon's low income between 2006 and 2015 was because it was investing a lot into online retailing, warehouse distribution, and infrastructure. Starting costs were causing their net income to be negative but as they paid their upfront costs, Amazon started seeing a significant increase in its net income in the past few years.

How do Amazon warehouse staff know where to find items? How does technology help make the process most efficient?

Amazon's warehouse has technology enabled operations such as a unique barcode to identify all its products, a database which tracks/monitors all products, and software that informs the picker the optimal route.

How does the Android Auto initiative benefit other participants in this ecosystem? What are the potential challenges?

Android Auto allows developers the opportunity to bring new experience into the car. However, it also has a ton of connectivity issues and it's expensive.

Why has Android been so successful?

Android has been so successful because it's highly customizable, it's open source so anyone can develop android based ROMs, and it's available for free.

What is business intelligence system? Why has business intelligence become so popular nowadays?

Business intelligence systems use data created by other systems to provide reporting, sophisticated data modeling, and analysis for organizational decision making. It's popular because it increases interconnectivity of devices and systems, declining the cost of storage and computing. It also helps understand the past and present, and allows you to predict the future. You can also collect data more efficiently and in a large scale.

Understand how Caesars Entertainment collects data and uses data to understand its customers.

Caesars Entertainment collects data by using a loyalty program. They gather data by getting their basic personal information, betting patterns, how much and how long they played, how often they visited, whether they like to eat in the casino, and stay the night. They use this data to understand its customers by deciding what is most effective marketing instrument, where the big money is, and targeting their audience (40+ years old).

What is chaotic storage? What are the benefits provided by chaotic storage? Understand how Amazon uses IT to enable its chaotic storage management.

Chaotic storage is organic shelving system without permanent areas or sections. The product's characteristics and attributes are irrelevant.

What is classification? Understand how to interpret a classification tree, i.e., be able to describe how you would make predictions when given a classification tree.

Classification is arranging the data into predefined groups.

What is clustering? What is the difference between classification and clustering? Understand the RFM analysis basics.

Clustering is when similar records or characteristics are grouped together. Classification depends on predefined categories whereas clustering is grouped together on the basis of self-similarity. RFM analysis ranks the recency of purchase, order frequency, and the amount spent on a scale of 1-5 for each category to analyze customers based on purchasing patterns.

What is the content adjacency problem? Why does it occur? What can advertisers do to minimize the likelihood that a content adjacency problem will occur?

Content adjacency problem is when ads appear alongside text which the advertiser is trying to avoid. Negative keywords are words that prevent an ad from showing up when specific terms are present. Implementing these would minimize the likelihood that a content adjacency problem will occur.

What is DBMS? What are the major DBMS products?

DBMS is Database Management System which is a software for creating, maintaining, and manipulating data. Major DBMS products are Oracle, IBM, Microsoft SQL Server, and SAP.

What are the roles played by IT for Zara's product design, in terms of both the idea-gathering process and the idea implementation process?

Data is gathered in stores using the point of scale system, personal digital assistants, and forensics of trend spotting. Data from the stores is sent to Inditex and the sketches are eventually coded into computer-aided design system.

What is data mining? What is the key difference between reporting tools and data mining tools?

Data mining is the automated search in large datasets for non-obvious patterns and relationships to anticipate events or predict outcomes. Reporting tools integrate data from multiple sources and process it by sorting, grouping, summing, averaging, and comparing.

What is the difference between data warehouse and data mart?

Data warehouse is a set of databases designed to support decision making in an organization. Data mart is a database or set of databases focus on addressing the concerns of a specific problem or business unit.

What is database? Why do people use a database?

Database is a single table or a collection of related tables. People use a database to eliminate data redundancy and retrieve information from multiple tables.

What is dumpster diving? What is shoulder surfing?

Dumpster diving is combing through trash to identify valuable assets. Shoulder surfing is gaining compromising information through observation.

What is foreign key? When given a set of tables and certain assumptions, understand how to identify foreign key.

Foreign key is an attribute or set of attributes in a relation of a database that serves as primary key of another relation in the same database. It helps link different relations in a relational database.

What is geotargeting?

Geotargeting is identifying a user's physical location for the purpose of delivering tailored ads or other content.

What is the major difference between Google's AdWords and Google's AdSense?

Google AdSense is when third party websites run ads for Google in exchange for a cut of the take whereas Google AdWords is paying to be advertised and using keywords that would be used to trigger the display of the ad. They choose the maximum cost per click there are willing to pay.

Why does Google enter into the handset market and how does this shape the relationship between Google and all other OEMs using Android? If you were Google, how would you address this concern?

Google entered the handset market because they wanted to control all facets of the customer experience. This shaped the relationship between Google and all other OEMs using Android because they made a firewall between android and pixel. If I were Google, I would do the same because it's better to keep the competition than actually compete with it.

What kind of capital commitment is necessary to go into the search engine business? How does this impact competitive dynamics in the industry?

Google has an index of web pages on 1.4 million web servers which is an incredible upfront capital commitment. Entering the market it really difficult because of cost and network effects.

How are ads sold via Google search superior to conventional advertising media such as TV, radio, billboard, print, and yellow pages?

Google has trackability which means they can they use a small piece of tracking code to collect data about your website visitors and their interactions on your website. They are also superior because of convenience, low prices, and the high probability of attracting customers due to the huge target audience. They are also the future of advertising and with time, they'll be the only channel of advertisement.

How does Google's search engine work? When you perform a search via Google, do you actually search over the Web?

Google uses PageRank which is determined by relevance, in-bound links, and about 200 other factors. 34% of the time, people click the first link after a Google search.

Why does Google develop Android?

Google wanted to create its own system for distributing its services in addition to making Google apps for other platforms.

How is scale important to Amazon? What advantages does scale offer Amazon over its smaller rivals?

Having more customers allows Amazon to have more products, creating scale. Some advantages scale offers Amazon are more products, same day delivery, and a greater selection of products.

Would you support the ruling by the E.U. for its fine of $5.1 billion on Google? Why or why not?

I would not support it because google facilitates competition. Ex: making the firewall between pixel and android 

Put yourself in the role of an advertiser for a product or service that you're interested in. Is the Internet an attractive channel for you? How might you use the Internet to reach customers you are most interested in? Where might you run ads?

I would use the internet for advertising because there are so many potential users every single day. I would use keywords and negative keywords to effectively have my ads properly showing whenever they need to be shown. I would run ads through Google because it's used by so many and it's popular.

What is the rationale for Zara to offer most products in limited run?

It is to cultivate the feeling of exclusivity, encourage customers to buy right away at full price, encourage customers to visit more often, and reduce the risks of mistakes.

What are the key challenges faced by network operators in the mobile industry?

It's a high investment and they try to tightly control Handset Manufacturers.

Do you think Amazon should continue to keep Amazon Web Services (AWS) as part of Amazon.com, or should it spin the firm out as a separate company?

Keep AWS as part of Amazon.com. Most of Amazon's revenue is generate via the AWS and splitting it into two separate companies would push loses on Amazon's overall retained earnings and net income.

In terms of the measurement of online advertising, what is PPC? What is PPA? What is PPM? Understand the difference between the three measures.

PPC is pay-per-click which means advertisers don't spend money until someone clicks on their ad. PPM is pay-per-(thousand)-impressions which means you pay for the number of times an ad is shown on the website. PPA is pay-per-action which means advertisers pay depending on the actions taken after the person clicks on their ad.

What is phishing?

Phishing is leveraging the reputation of a trusted firm or friend to trick the victim into revealing sensitive information and installing malicious software.

What is primary key? What is the difference between simple primary key and composite primary key? When given a table and certain assumptions, understand how to identify primary key.

Primary key is an attribute or set of attributes that uniquely identifies each row of the relation in question. A composite primary key has multiple attributes.

What is the "conventional wisdom" of fashion industry with respect to design? What counterintuitive actions has Zara taken?

Product design is created for each season; by high profile in-house designers; pushed via catwalk shows. Zara predicts the trends instead of forcing them through fashion shows.

What is cash conversion cycle? Be able to calculate cash conversion cycle when given numbers.

The CCC is the period between the receipt of cash from accounts receivable and the payment of cash for inventory.

List the functions performed by Retail Link. What is its benefit to Walmart? How does it affect the relationship between Walmart and its suppliers?

The functions are optimizing product assortment and analyzing local preferences, optimizing product delivery schedule and quantity, etc. This allows the suppliers to know in real-time when stores need to be restocked rather than waiting for an order.

Be able to list the key areas where businesses are leveraging data mining.

The key areas where businesses are leveraging data mining are marketing and promotion targeting (determining which customers will respond to an offer), market basket analysis (which products customers buy together), collaborative filtering (how to make recommendations and personalize an individual customer's experience based on the trends and preferences exhibited by similar customers), and hiring and promotion (identifying characteristics consistent with employee success in the firm's various roles).

What are the major human resource (HR) functions incorporated in an ERP system?

The major HR functions are employee benefits such as medical, dental, and life insurance and retirement benefits and social security benefits, payroll such as time and labor collecting and paycheck processing, and personnel such as tracking applicants.

What are the major frauds associated with online search advertising?

The major frauds are Enriching click fraud (generate bogus ad clicks to earn ad revenue), Depleting click fraud (clicking a rival's ad to exhaust their advertising budget), and Rank-Based impression fraud (repeatedly search own keywords and click to improve CTR, and search rival's keywords and not click to lower CTR).

Based on the SDCS case, what are the major benefits from the ERP investment? Among these benefits, what are the intangible benefits from the ERP investment? Understand the importance of incorporating intangible benefits (including productivity increase and soft benefits) into investment on return analysis.

The major intangible benefits are improved employee morale/productivity, improved recruiting, improved management access to data, and cost and time reduction. It's important to incorporate intangible benefits when calculating investment return because without it you would calculate a negative investment and advise against implementing the ERP system, when it would be wise to actually invest in the program.

What are the major upfront and ongoing costs of implementing HR modules?

The major upfront costs are software, infrastructure, labor, implementation/consulting, training. The major ongoing costs are onsite IT support, software maintenance and support fees, hardware maintenance, incremental networking, and infrastructure maintenance.

What is denial of service (DOS) attack? Understand that it is very easy to launch DOS attack but difficult to stop, as it is hard to distinguish between authentic Web conversations and DOS attacks.

A cyber-attack in which the hacker seeks to make a machine or network resource unavailable to its intended users by temporarily or indefinitely disrupting the services.

Why would a firm use a loyalty card? What is the incentive for the firm?

A firm would use a loyalty card to get a detailed customer profile. The incentive is to decide the most effective marketing instrument.

To address the information security issues, how would you take actions as a user and what actions can an organization take?

As a user, you can install anti-virus and anti-spyware programs, install updates promptly, open email attachments only from known sources, and browse reputable internet neighborhoods. As an organization, you can push education, audit, and enforcement.

What is association detection? What are the key metrics to look at when you decide the best association rule?

Association Detection is when one event is correlated to another event. Determine which behaviors/outcomes go together.

Understand the key features of the Mirai attack.

Attack on DNS server for almost 10 hours; Largest DDoS attack ever; attacked internet of things which became a new hunting ground for hackers.

For association detection, what does lift ratio indicate? What does a lift ratio less than 1 imply? What does confidence indicate? What does support count indicate? Suppose you plan to launch a cross-selling campaign and are given a set of selling strategies (deriving from association rules), be able to identify and argue which strategy you would go with.

Lift ratio is an indicator of whether an association rule is useful. A lift ratio less than one implies that the presence of the antecedent actually causes a reduction in the probability of purchase of the consequent. Confidence indicates the percent that the consequent was purchased given the antecedent is purchased. Support count indicates how frequently the items appear in the data.

What is NPV? Understand how to calculate NPV given an IT investment scenario.

NPV is the net present value. It's calculated by taking the net benefits/1+r of every single period and subtracting the initial investment.

What are the major participants in the mobile industry?

Network Operators (carriers), Handset Manufacturers, Operating System Providers, Content and Application Providers.

Would you recommend the same type of digital mirror developed by Neiman Marcus to Zara? Why, or why not?

No because Zara is already doing so well so they don't need to invest in something so expensive for all their stores because it won't generate more revenue for them for it to be worth it.

How do online systems track customer behavior? Why do we say online systems would give organizations more insights than traditional transaction processing systems?

Online systems track when customers remove products, visit a product comparison page, and which products they pass over. With more insights, you are able to collect more data which leads to more sales, and you're able to give customers exactly what they want.

Be able to list the three value disciplines and list example firms that focus on each value discipline and discuss why.

Operational Excellence -Example: Amazon Customer Intimacy -Example: Amazon, Netflix Product Leadership -Example: Apple, Intel

What is organic search? How does Google decide the rank of organic search results?

Organic or Natural search is the search engine results returned and ranked according to relevance. Google uses Search Engine Optimization which is the process of improving a page's organic search rankings.

What are the four major data mining techniques? If you are given an example, be able to know which type of data mining technique it belongs to.

Regression: attempt to find a function which estimates the relationships among variables with the least error. Example: which age group of customers spend more Classification: arrange the data into predefined groups Example: classify credit applicants as low, medium or high risk; customer as loyal or likely to terminate Clustering: similar records or characteristics are grouped together Example: market segmentation which means identifying customers with similar buying behavior Association Detection: when one event is correlated to another event Example: market basket analysis which determines what things go together in a shopping cart at the supermarket

What is relational database? Understand the meaning of the following terms in relational database context: records, attributes, fields. What are the requirements for a table in relational database?

Relational database is when tables are related based on common keys. Records are rows and attributes are named columns (also called fields).

What is retargeting?

Retargeting is when a user visiting the Amazon page was tracked, and the user's interest in this product was recorded in order to show advertisements for the product when that same user visited other websites.

Understand how SQL injection works.

SQL injection is when a hacker takes advantage of web input forms to access or destroy data. SQL commands can be inputted into web forms instead of the expected proper data. This can be interpreted by vulnerable web applications as an additional instruction to operate in the hacker's favor. The effects are loss or editing of data, spreading of personal details, and unplanned purchases. You can prevent it with a suitable network policy.

What is SQL? What's the structure of a SQL statement?

SQL is structured query language and it is used to retrieve information from the database. The structure is SELECT, FROM, WHERE for a SQL statement.

What are the major challenges associated with Android being an open-source operating system?

Since Android is open source, there's the problem of device fragmentation because every device manufacturer will create something slightly different. There is also no set standard for Android operating system.

Why does Google give Android for free?

Since Google makes a ton of revenue from its search engine and ads, it doesn't need to charge for Android. Instead, by making it free, they reach a larger audience which eventually generates more revenue within the areas they charge for.

How does Google decide the rank of sponsored ads? What factors influence ads' quality score?

The advertisers decide how much they are willing to pay (the bid). The quality score is determined by the relevance of ad text to user query, history of click performance for keywords linked to the ad, click through rate, and Google's automated assessment of the user experience on the landing page.

What basic functions should an ERP system provide to an educational institution? What are the major problems in ERP implementation in educational industry in general and what are the unique problems for the San Diego City Schools (SDCS) in particular?

The basic functions that an ERP system should provide to an education institution are student information systems, food and health services, human resource management, financial applications, and student tracking functions. The major problems for ERP implementation include under-qualified personnel in charge of these systems and a limited budget which means not a lot of IT spending. The unique problems for SDCS were limited budgets because only 2% of all revenues were spent on IT, under qualified personnel because they had lack of knowledge among district employees, and because of changing leadership.

What is the conventional supply chain structure in the fashion industry? What are the major benefits and drawback for such supply chain structure?

The conventional supply chain structure is suppliers to manufacturers to distributors to retailers to customers. The benefits are that it's outsourced to foreign manufacturers where there's cheap labor. The disadvantages are that you have to guess what the customers want and how much of it they want.

Understand different motivations for hackers to break into corporate computer systems.

The different motivations are to apply for a loan or credit card, take your tax return, buy cable/cellular service, sell to others so that others can do that above, and get data from customers.

What are the roles played by IT for Zara's manufacturing and logistics?

The fabric is cut and dyed by robots.

What factors determine the appeal of an ad network to advertisers and content providers? Which of these factors are potentially sources of competitive advantage?

The factors that determine the appeal of an ad network to advertisers and content providers are Google's algorithm since ads are more effective, and the two sided market since more ads generates more revenue content providers and vice versa. The two sided market makes it harder to enter the market and compete, especially due to the network effects.

Understand how Equifax's data breach happened and why it happened. New report says there was essentially no real changes one year after its data breach. How would you explain this?

The software was out of date, the network inspection system had not been working for 10 months, and the hackers ran 9000 queries from 51 databases. The breach didn't affect the sales revenue so they didn't do anything to change their software.

Where are the potential vulnerabilities of information security?

The vulnerabilities are physical threats, user and administrative threats, and technology threats such as malware.

What risks are inherent in the conventional practices in the fashion industry? Is Zara susceptible to these risks? Is Zara susceptible to different risks? If so, what are these?

There are risks of there being too many items that aren't sold. Zara doesn't face these risks because of how their supply chain works. However, they do face risks of lower price competitors and being unable to predict the future changing trends.

Before Android was launched, what were the key challenges to handset manufacturers and content/app providers? Has Android addressed these challenges?

There was competition on technical design and utility, functionality, and performance. They also needed to compete by offering compelling combination of hardware and software.

Understand how users in an organization may create security threats.

Users create security threat from Bad Apples. These are internal employees who can steal from the company, steal secrets, install malware, and hold firms hostage. They can be contract employees, temporary staff, outsourcing key infrastructure components, and partner firms such as clients and technology providers.

What is computer virus? What is computer worm? What is Trojan horse? What are the differences among these three types of malware?

Viruses are malicious codes that spread by attaching themselves to files that are part of legitimate installed programs. A computer worm is a self replicating malicious code. A Trojan horse is a computer program that provides useful functionality and delivers a hidden, malicious payload, after installation.

Can a firm buy a top ad ranking? Why or why not?

Yes, the ad with the highest Ad Rank will generally appear on the top.

What is the difference between Zara's supply chain and the conventional supply chain in the fashion industry? What are the major benefits for Zara's supply chain structure?

Zara's supply chain starts with what the customer wants and works its way back to supply those products. The benefit is knowing exactly the quantity and items to supply. The disadvantage is that they have to constantly be ordering shipments.

Understand the dilemma in evaluating the importance of information security systems.

if security is working properly, nobody ever notices it and information security systems hardly directly increase sales; however, when something goes wrong, it can destroy a business.