BTMA 317 Chp 2

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Start/End

Which of the following is true of supplier power?

Supplier power is high when buyers have few choices from whom to buy, and it is low when buyers have many choices.

Landscaping Inc. is a company that produces landscape architecture services. The Brighton Team in the firm focuses on getting client orders to landscapers and seamlessly launching them into client projects; the Stanton team is composed of landscapers executing landscape architecture plans. What matrix does the Brighton team and the Stanton team respectively employ in their work?

The Brighton team works with effectiveness, and the Stanton team works with efficiency.

mass customization

The ability of an organization to tailor its products or services to the customers' specifications Ex: NikeID

Jessica is opening a used book store in a university town. She is trying to profile her business to attract customers and is competing with two other used book stores, an independent regular book store and a big chain mass-market book store, in addition to online book stores. Which is the CORRECT analysis of Jessica's product offering according to the competitive forces model?

The bargaining power of buyers is high because of the many options for obtaining books in Jessica's area.

What is the difference between primary and support activities in the Porter value chain model?

The primary activities add value, whereas the support activities do not.

The rivalry among existing firms in the industry

The threat from rivalry is high when there is intense competition among many firms in an industry. The threat is low when the competition is among fewer firms and is not as intense.

Threat of entry of new competitors

The threat that new competitors will enter your market is high when entry is easy and low when there are significant barriers to entry.

Julio is working with translations from English into Spanish and Portuguese, but eight years ago, as a new immigrant, he had trouble finding a job. In what way have business pressures contributed to Julio becoming more integrated on the work market?

The variety of positions on the work market has broadened, and many people can work from home.

(True/False): BPI initiatives do NOT deliver the huge performance gains promised by BPR

True, ppl prefer them because they are less risky & costly

Fizzyfruit is the main competitor to the fruit juice-based soda Naturefizz. The people behind Naturefizz want to gain an edge over their main competitor, and they come up with the idea to launch a new type of drink containing half fruit, half pure cane sugar, and no caffeine. They call this drink Nature's Half & Half. Connected to this launch, Naturefizz also introduces a sparkling water with fruit juice, called Nature Sparkle, and at the same time the company re-vamps the cans on its old trademark, Naturefizz. Would the strategy of Naturefizz have a valid chance of success?

Yes. It is a classical innovation strategy with introductions of new products and adding new features to existing products.

business process management (BPM)

a management technique that includes methods and tools to support the design, analysis, implementation, management, and optimization of business processes

Grocers can speed up checkout in their stores by using what type of device or system?

a radio-frequency identification system

Rectangle

activities performed (the task/process) Ex: reserve seats/issue e ticket

Customer Focus

an organizational goal to concentrate on meeting customers' needs at all levels of the organization

Derek is using process simulation software to estimate a process performance for his company. What phase in the BPI process is he working in?

analysis

Competitive advantage

any assets that provide an organization with an edge against its competitors in some measure, such as cost, quality, or speed.

Societal/Political/Legal Pressures

business pressures related to social responsibility, government regulation/deregulation, spending for social programs, spending to protect against terrorism, and ethics.

Your boss has asked you to implement a non-disruptive and incremental approach to ensure business process excellence. What kind of strategy should you be implementing, and why?

business process improvement, since it is designed to be incremental in nature and used to organize work around business processes rather than individual tasks

You have been tasked with designing a transactional-based information system. Which of the following should you include in this system?

capturing and storing process data that is collected automatically by the IS, as well as through RFID tags and barcodes

fulfilment process

concerned with processing customer orders

arrows

connect the steps and indicate the sequence of activities

Rachel's organization is establishing process metrics and choosing an IS that will help ensure the process performance remains stable. What phase in the BPI process is the organization in?

control

Effectiveness

creating outputs of value to the business process customer; getting things done

A(n) __________ can be either internal or external to an organization.

customer

Online clothing chain Modern Vintage is known for its personalized one-to-one relationship with its customers. Its biggest competitor, Vintage Faux, however, prides itself on offering express package delivery all across the state. Modern Vintage and Vintage Faux provide examples of

customer orientation strategy and operational effectiveness.

diamond-shaped box

decisions that need to be made Ex: are seats available?

Increasing the number of loyalty programs

decreases buying power

Miguel's team is currently documenting the customer and customer's requirements for the process output. Which phase of the BPI is he in?

define

Carlos has come to realize that in order to stand out from firms in his industry, he has to add new services and products to his model. This is an example of a(n) __________ strategy.

differentiation

Support Activities

do NOT add value directly to the firm's products or services but supports Primary Activities

Efficiency

doing things without wasting resources; getting more things done with same/fewer resources

Two fundamental metrics that organizations employ in assessing their processes are

effectiveness and efficiency

Maria is opening a new sports bar in her neighborhood, and she is worried that she may not receive the liquor license she is applying for. Which of Porter's five fundamental forces on the competitive forces model has she encountered?

entry barrier

an individual or a business that purchases the organization's products is the ________ customer of the fulfilment process

external

Technological innovation is a big concern for businesses because it

forces them to keep up

The company Earthly Treasures makes it a specific goal to rotate business and IT professionals across departments and tasks. This means the company will MOST likely develop

good business-IT alignment.

Jonas is the director of IT at his organization. He has been tasked with tracking the organization's carbon footprint through the supply chain. This is an example of

green IT

Combining operational process data stored in a company's IS systems with other data sources and examining data in the "as is" process map are different because

he former is part of the measure phase of BPI, and the latter is part of the analysis phase of BPI.

Porter's Value Chain Model

identifies points for which an organization can use information technology to achieve a competitive advantage; divided in 2 categories primary & support activities

value system AKA industry value chain

includes the suppliers that provide the inputs necessary to the firm along with their value chains. After the firm creates products, these products pass through the value chains of distributors (which also have their own value chains), all the way to the customers

A manager who is the recipient of an internal reporting process is an example of an ________ customer

internal

Michael is a manager who is in charge of analyzing internal reports. He is considered a(n)

internal customer

Business activity monitoring (BAM)

is a real-time approach for measuring and managing business processes; monitors business processes, find failures & indicate success/failure

A company that applies a cost leadership strategy to its business is focused on

lowering costs for its products and services.

Kirsten is offered the task of being a business process overseer in her organization. She is inexperienced and a little daunted by the sheer number of BPI projects and employees she needs to keep track of. A more experienced coworker advises her to

make a graphical description of all the steps in the process with the help of process modelling software, in order to understand the people, dependencies, interactions, and tasks better within a BPM setting.

The human resources function in a company would handle

management of employee pay and payroll.

Marilynn has noticed that, in the last few years, her customers have been using the Internet to become more knowledgeable about the products and services that she provides and to compare her prices against competitors. This is an example of

market pressures

After wrecking your car and being awarded more than your car was worth, you have decided to purchase a Vortex Hydrogen-fueled car designed by the leading billionaire of innovation, Talon Tusk. After reaching a market share of 500,000 cars, the automobiles have become more affordable and innovative than ever. Talon has set up a system in which you can choose the color, body style, amenities, horsepower, and even the dimensions, to a degree, for your own personal taste. Choose the BEST type of IT System Talon has implemented for your order.

mass customization system, in which a company produces a large quantity of items, but customizes them to meet the personal preferences of individuals

Which of the following is an example of a technology pressure?

obsolescence (outdated)

Business Process

ongoing collection of related activities or tasks that in a specific sequence create a product or a service of value to the organization, its business partners, and its customers.

Bargaining power of suppliers

organizations would rather have more potential suppliers so that they will be in a stronger position to negotiate price, quality, and delivery terms.

Process simulation software enables managers to estimate the _____________ of a process over time.

performance

What type of data is synonymous with transaction data?

process data

2 Important Components of BPM?

process modelling and business activity monitoring

Primary activities

production and distribution of the firm's products and services

Mass Customization

production process in which items are produced in large quantities but are customized to fit the desires of each customer.

The MIS department in a company is responsible for

protecting the company's information resources.

strategic information systems (SISs)

provide a competitive advantage by helping an organization implement its strategic goals and improve its performance and productivity

Strategic Systems

provide organizations with advantages that enable them to increase their market share and/or profits, to better negotiate with suppliers, and to prevent competitors from entering their markets.

Sylvia works with design, development, and production processes in an organization. This means that she focuses on the measure of competitive performance that is defined as

quality

Business Process Improvement (BPI)

reducing variation in the process outputs by searching for root causes of the variation within the process itself or among the process inputs.

Cycle and fulfilment time reduction

result of optimizing the manufacturing and logistics processes

Differentiation

result of optimizing the marketing and innovation process

Steven works in the IT department at a major insurance company and faces daily challenges due to BYOD. Why is BYOD a major challenge for Steve in his work?

security is weakened

Darryl's company has instituted a new technology to interface with customers on wired and mobile platforms with the end goal of improving process execution. What is his company using?

social BPM

Martin is hired by a big company as a consultant to work toward the company getting a LEED certification from the U.S. Green Building Council. At the same time, Martin switches to a new smartphone every year to keep up with work demands. Martin's job is an example of effects from which pressures?

societal and technological pressures

Process Modelling

standardized graphical model of a sequence of activities

Control Phase (BPI)

team establishes process metrics and monitors the improved process after the solution has been implemented to ensure the process performance remains stable. An IS system can be very useful for this purpose

Technology Pressures

technological innovation and information overload.

An example of ____________ pressures is new and improved technologies rapidly creating and supporting substitutes for products, alternative service options, and superb quality.

technology

In the procurement process, one of the roles of the accounting department is to manage

the accounts payable

Business Process Reengineering

the analysis and redesign of workflow within and between enterprises

One of the reasons that alignment in organizations is difficult to achieve is because

the business and IT departments know little of each other's expertise.

business environment

the combination of social, legal, economic, physical, and political factors in which businesses conduct their operations

Globalization

the integration and interdependence of economic, social, cultural, and ecological facets of life, enabled by rapid advances in information technology

Make-to-Order

the strategy of producing customized products and services

Porter's Five Forces

threat of entry, threat of substitute, supplier power, buyer power, competitive rivalry

Business-information technology alignment (business-IT alignment)

tight integration of the IT function with the organization's strategy, mission, and goal

RFID (radio frequency identification)

uses radio signals to communicate with a tag placed in or attached to an object

Where is procurement comprises done?

warehouse, purchasing, and accounting

Three Fundamental Elements of the Business Process

• Inputs: Materials, services, and information that flow through and are transformed as a result of process activities • Resources: People and equipment that perform process activities • Outputs: The product or a service created by the process

IS plays a major role in 3 areas:

• executing the process • capturing and storing process data • monitoring process performance

Operational Effectiveness Strategy

"I can do the same thing more efficiently than u" Improve the manner in which a firm executes its internal business processes so that it performs these activities more effectively than its rivals. Such improvements increase quality, productivity, and employee and customer satisfaction while decreasing time to market.

Cost Leadership

"I can sell at a lower price than u can" the positioning strategy of producing a product or service of acceptable quality at consistently lower production costs than competitors can, so that the firm can offer the product or service at the lowest price in the industry

Customer Orientation Strategy

"I treat my customers better than u do" Concentrate on making customers happy

innovation strategy

"I'm doing something new & u cant catch up" a strategy that emphasizes the introduction of major new products and services

Differentiation Strategy

"I am better bc I am different" Offer different products, services, or product features than your competitors

cross-functional processes

-No single functional area is responsible -steps executed in a coordinated, collaborative way -Procurement & Fulfillment Cross-functional processes

Three Types of Business Pressures?

1. Market Pressures 2. Technology Pressures 3. Societal/Political/Legal Pressures

6 Characteristics of Business IT Alignment

1. Organizations view IT as an engine of innovation 2. Organizations view their customers as supremely important. 3. Organizations rotate business and IT professionals 4. Organizations provide overarching goals that are completely clear 5. Organizations ensure that IT employees understand how the company makes (or loses) money. 6. Organizations create a vibrant and inclusive company culture.

Five Primary Activities

1. inbound logistics (inputs) 2. operations (manufacturing and testing) 3. outbound logistics (storage and distribution) 4. marketing and sales 5. services

Support activities consist of the following:

1. the firm's infrastructure (accounting, finance, management) 2. human resources management 3. product and technology development (R&D) 4. procurement

competitive forces model

A business framework made by Porter that analyzes competitiveness by recognizing 5 major forces that could endanger a company's position.

Procurement Process

A cross-functional business process that originates when a company needs to acquire goods/services from external sources, and it concludes when the company receives and pays for them.

Entry Barrier

A feature of a product or service that customers have come to expect and entering competitors must offer the same for survival

Business Process Reengineering (BPR)

A radical redesign of a business process that improves its efficiency and effectiveness, often by beginning with a "clean sheet" (from scratch). experienced many failures as it was too lengthy, comprehensive & difficult.

digital divide

A worldwide gap giving advantage to those with access to technology

business process management suites (BPMS)

An integrated set of applications that include a repository of process information like process maps/rules

When a company has described its business plan's steps, inputs, outputs, and resources, what is it able to do?

Analyze the process.

Define phase (BPI)

BPI team documents the existing "as is" process activities, process resources, and process inputs and outputs, usually as a graphical process map or diagram

Analysis Phase (BPI)

BPI team examines the "as is" process map and the collected data to identify problems with the process (e.g., decreasing efficiency or effectiveness) and their root causes

Improve Phase (BPI)

BPI team identifies possible solutions for addressing the root causes, maps the resulting "to be" process alternatives, and selects and implements the most appropriate solution

Measure Phase (BPI)

BPI team identifies relevant process metrics, such as time and cost to generate one output (product or service), and collects data to understand how the metrics evolve over time

BPI vs BPR

BPI: Low risk / low cost Incremental change Bottom-up approach Takes less time Quantifiable results All employees trained in BPI BPR: High risk / high cost Radical redesign Top-down approach Time consuming Impacts can be overwhelming High failure rate

Why should companies drive the BPM effort?

BPM helps companies improve profitability by decreasing costs and increasing revenues. BPM can create a competitive advantage by improving organizational flexibility—making it easy to adapt to changing business conditions and to take advantage of new opportunities. BPM also increases customer satisfaction and ensures compliance with rules and regulations

The bargaining power of customers (buyers)

Buyer power is high when buyers have many choices from whom to buy and low when buyers have few choices.

Circle

Connector

Strategies for Competitive Advantage

Cost leadership, differentiation, innovation, operational effectiveness, customer orientation

5 Phases of BPI

Define, Measure, Analyze, Improve, Control

When Steve was designing a transactional based IS, some process data was generated outside the IS and could not automatically be captured. What should be Steve's solution to this?

Enter the data to the IS through manual or automated methods with bar codes and RFID tags.

Market Pressures

Globalization Changing Nature of the Workforce Powerful Customers

The VP of IT infrastructure asked you, as a business analyst, to speak on the current business environment and the effects of that environment on the company. When you speak to societal, political, and legal pressures, you focus on social responsibility, ethical issues, the changing nature of the workforce, and globalization. The VP suggests you break two of those components into another category of business pressure within the environment. Which components should be categorized into which business pressure?

Globalization and the changing workforce should be categorized as market pressures.

Threat of substitute products or services

High when there are many alternatives to a product or service and low when there are few alternatives

Donald and Wendy are project managers for a big project that is similar to a project carried out successfully by the company last year. They plan to find all old material from the project last year and use it as a blueprint for success this year. They also plan to prepare a business forecast, purchase new materials, and arrange a small getaway for their team so they can bond and focus better on future tasks. Which cross-functional business processes would this project include?

Human Resources, Finance, and Production

LDS International decides to engage an internal customer for its business process of creating a specific product. It chooses

Marcus, an analyst of the company's process reports.

Consumer Segmentation

Overall purpose: Achieve the greatest amount of sales with the least amount of expense

Christof is identifying the threat of new entrants into his organization's industry as well as the threat of substitute products and services. Christof is using

Porter's competitive forces model.

Rodger's organization has instituted a new BYOD policy. Which of the following is the MOST likely result of this new policy?

Proprietary organizational information will not be as secure.