Chapter 2

What is the difference between a value chain and a supply chain?

A value chain is a series (chain) of events that includes inbound logistics, warehouse and storage, production, finished product storage, outbound logistics, marketing and sales, and customer service. A supply chain is a network of suppliers, distributors, and retailers that participate in the production of a product.

Briefly define the term "business process reengineering."

Business process reengineering is the radical redesign of business processes, organizational structures, information systems, and values of the organization to achieve a breakthrough in business results.

What is meant by continuous improvement?

Continuous improvement is a form of innovation that constantly seeks ways to improve business processes and add value to products and services.

Sketch and briefly describe Leavitt's diamond. sites.

Leavitt's diamond proposes that every organizational system is made up of four main components—people, tasks, structure, and technology—that all interact, any change in one of these elements will necessitate a change in the other three elements. Thus, to successfully implement a new information system, appropriate changes must be made to the people, structure, and tasks affected by the new system.

What do the terms "organizational culture" and "organizational learning" mean?

Organizational culture consists of the major understandings and assumptions for an organization. Organizational learning is the adaptations and adjustments made within an organization based on experience and ideas over time.

What is outsourcing? How is it different from offshoring?

Outsourcing is a long-term business arrangement in which a company contracts for services with an outside organization that has expertise in providing a specific function. Offshoring is an outsourcing arrangement where the organization providing the service is located in a country different from the firm obtaining the services.

What is meant by the term "shadow IT"?

Shadow It is the term used to describe the information systems and solutions built and deployed by departments other than the information systems department. In many cases, the information systems department may not even be aware of these efforts.

What activities are encompassed by supply chain management?

Supply chain management (SCM) helps determine what supplies are required for the value chain, what quantities are needed to meet customer demand, how the supplies should be processed (manufactured) into finished goods and services, and how the shipment of supplies and products to customers should be scheduled, monitored, and controlled.

Identify and briefly describe the differences between the two types of innovation discussed in the chapter.

Sustaining innovation results in enhancements to existing products, services, and ways of operating. Such innovations are important because they enable an organization to continually increase profits, lower costs, and gain market share. A disruptive innovation is one that initially provides a lower level of performance than the marketplace has grown to accept. Over time, however, the disruptive innovation is improved to provide new performance characteristics, becoming more attractive to users in a new market.

What are some of the characteristics of a virtual team?

The members of a virtual team are distributed geographically, but collaborate and complete work through the use of information systems. Members may seldom meet face to face. Virtual team members must be prepared to do work anywhere, anytime. As a result, members of a virtual team may feel that their work day never ends.

Describe the role of a CIO within an organization.

The role of CIO is to employ an IS department's equipment and personnel to help the organization attain its goals. CIOs also understand the importance of finance, accounting, and return on investment. They can help companies avoid damaging ethical challenges by monitoring how their firms are complying with a large number of laws and regulations.

What is meant by the term "the soft side of implementing change"?

The soft side of implementing change involves work designed to help employees embrace a new information system and way of working.