Introduction to Electronic Commerce, 3e (Turban)
Chapter 11 EC Strategy and Implementation: Justification, Globalization, SMEs,
and Regulatory and Ethical Issues
11.1 True/False
1) Strategy has been, and remains, focused on questions about organizational fit, trade-offs,
profitability, and value.
2) Any contemporary strategy-setting process must include the Internet.
3) The threat of substitute products or services is a major force that can endanger a company’s
position in a given industry.
4) In Porter’s view, the majority of the Internet’s impacts on the five competitive forces have
been positive.
5) In the strategy initiation phase, the organization examines itself and its environment.
6) A value proposition is a financial statement that summarizes the annual revenue and profit
targets.
7) Core competency refers to the unique combination of the resources and experiences of a
particular firm.
8) Google and eBay have similar core competencies.
9) Forecasting means identifying business, technological, political, economic, and other relevant
trends that are currently affecting the business or that have the potential to do so in the future.
10) SWOT analysis involves scanning the business environment to collect and interpret relevant
information about direct competitors, indirect competitors, and potential competitors.
11) In the strategy implementation phase, general long-term plans are continuously evaluated.
12) Every business needs a business plan to acquire funding and to ensure that a realistic
approach is being taken to implement the business strategy.
13) Project management is the process of making the selected applications and projects a reality,
including hiring staff; purchasing equipment; and licensing, purchasing, or writing software.
14) Strategy assessment is the continuous evaluation of progress toward the organization’s
strategic goals, resulting in corrective action and, if necessary, strategy reformulation.
15) A business plan is the quantitative expression of critically important metrics.
16) Companies need to justify their EC investments as part of strategy formulation for a number
of different reasons, but a majority of companies lack the knowledge or tools to do ROI
calculations.
17) A metric is a specific, measurable standard against which actual performance is compared.
Metrics are used to describe costs, benefits, or the ratio between them.
18) Spam messages are at least 70 percent longer than legitimate e-mails.
19) One of the most contentious areas of global EC is the resolution of international legal issues.
20) Intellectual property law is the area of the law that includes copyright law, patent law,
trademark law, trade secret law, and other branches of related law, such as licensing and unfair
competition.
21) Ethics is the branch of philosophy that deals with what is considered to be right and wrong.
22) Blue computing is the study and practice of ecofriendly computing resources.
23) EPEAT-registered products must meet 42 mandatory environmental criteria.
24) EC will become an increasingly important method of reaching customers, providing services,
and improving operations of organizations.
25) Net neutrality is a trend that will speed EC and Web 2.0 activities.
11.2 Multiple Choice
1) For ________ companies, it may be even more important to change strategies quickly.
A) traditional
B) pure-play
C) service
D) retail
2) Internet capabilities that make it more difficult for companies to capture profits include each
of the following except:
A) The Internet makes information widely available.
B) The Internet reduces the difficulty of purchasing, marketing, and distribution.
C) The Internet makes it easier to make secure payments.
D) The Internet allows buyers and sellers to find and transact business with one another more
easily.
3) Identifying business, technological, political, economic, and other relevant trends that are
currently affecting the business or that have the potential to do so in the future best defines
A) forecasting.
B) SWOT analysis.
C) competitive intelligence.
D) value proposition.
4) The unique combination of the resources and experiences of a particular firm best defines
A) corporate strategy.
B) core competency.
C) functional strategy.
D) competitive advantage.
5) Google’s ________ is its expertise in information search technology.
A) core competency
B) value proposition
C) SWOT
D) company analysis
6) The basic reasons that companies invest in IT and EC include each of the following except
A) improve business processes.
B) increase customer satisfaction and retention.
C) reduce time-to-market.
D) justify new marketing campaigns.
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7) Not all EC investments need to be formally justified. Each of the following is a case where
formal evaluation may not be needed except
A) when the value of the investment is relatively small for the organization.
B) when competitors have made that type of investment.
C) when the relevant data are not available, are inaccurate, or are too volatile.
D) when the EC project is mandated and must be done regardless of the costs and benefits.
8) Metrics are used to describe each of the following except
A) costs.
B) benefits.
C) standards.
D) ratio of costs to benefits.
9) Tangible metrics for a B2C seller include each of the following except
A) profit per customer.
B) customer retention rate.
C) customer loyalty.
D) market share.
10) Tangible metrics for a G2C EC user include each of the following except
A) reelection of candidates.
B) reduction in cost of transactions.
C) reduction in licensing fees.
D) lower tax rates.
11) Productivity benefits from using EC are difficult to measure because
A) the payoffs are too short.
B) there is no time lag in EC gains.
C) EC gains in certain areas of the company may be offset by losses in other areas.
D) qualitative benefits do not count.
12) Intangible metrics in the model for IT project justification include each of the following
except
A) lead-time.
B) competitive advantage.
C) services to society.
D) growth enabler.
13) Barriers that are specific to global EC include the following types of issues except
A) cultural.
B) legal.
C) technical.
D) localization.
14) Many companies use different names, colors, sizes, and packaging for their overseas
products and services. This practice is referred to as
A) localization.
B) geo-focus.
C) world trade.
D) specialization.
15) EC advantages for small and medium-sized businesses include
A) reduced personal contact with customers.
B) less risk tolerance than a large company.
C) inexpensive sources of information.
D) ability to purchase enough volume to take advantage of digital exchanges.
16) Creations of the mind, such as inventions, literary and artistic works, and symbols, names,
images, and designs, used in commerce describes
A) intellectual property.
B) civil law.
C) criminal law.
D) personal property.
17) The legal term for the use of the work without permission or contracting for payment of a
royalty is
A) copyright violation.
B) theft of intellectual property.
C) infringement.
D) theft of digital rights.
18) ________ is an umbrella term for any of several arrangements that allow a vendor of content
in electronic form to control the material and restrict its usage.
A) Digital rights management
B) Fair use
C) Intellectual property management
D) Patent management
19) Each of the following statements about ethics and related issues is true except:
A) All ethical codes get incorporated into public law.
B) Ethics characterize how individuals choose to interact with one another.
C) A common agreement in a society as to what is right and wrong determines ethics, but they
are not subject to legal sanctions except when they overlap with activities that are also official.
D) Law embodies ethical principles, but they are not the same.
20) In law, fair use refers to the use of copyrighted material for ________ purposes.
A) entertainment
B) commercial
C) noncommercial
D) educational
21) Which of the following is a symbol used by businesses to identify their goods and services,
and government registration of the trademark confers exclusive legal right to its use?
A) trademark
B) patent
C) registration
D) copyright
22) Which U.S. law mandates the use of filtering technologies in schools and libraries that
receive certain types of federal funding?
A) Privacy Protection Act
B) Homeland Security Act
C) Children’s Internet Protection Act
D) Computer Fraud and Abuse Act
23) An agreement that requires computer users to take specific steps to allow the collection of
personal information is called
A) user acceptance agreement.
B) informed consent.
C) opt-out.
D) opt-in.
24) A protocol allowing Web sites to declare their intended use of information they collect about
browsing users best describes
A) USA PATRIOT Act.
B) Electronic Product Environmental Assessment Tool.
C) Platform for Privacy Preferences Project.
D) Children’s Internet Protection Act.
25) This act was passed in October 2001, and its intent is to give law enforcement agencies
broader range in their efforts to protect the public.
A) USA PATRIOT Act
B) Electronic Product Environmental Assessment Tool
C) Platform for Privacy Preferences Project
D) Children’s Internet Protection Act
26) The study and practice of ecofriendly computing resources, and it is now a key concern of
businesses in all industries best describes
A) natural computing.
B) green computing.
C) energy efficient computing.
D) blue computing.
27) Software products that help companies save energy or comply with EPA requirements best
describes
A) compliancy software.
B) efficiency software.
C) green software.
D) ERP software.
28) A searchable database of computer hardware that meets a strict set of environmental criteria
best describes
A) Information Technology Assessment Tool.
B) One Step To Green Computing.
C) Electronic Product Environmental Assessment Tool.
D) Environmental Protection Computing Resource.
29) Worldwide purchases of EPEAT-registered products result in each of the following except
A) reduced use of primary materials.
B) reduced use of toxic waste materials.
C) avoiding the disposal of tons of hazardous waste.
D) reduced staffing requirements.
30) Trends that may slow EC and Web 2.0, and even cripple the Internet include
A) security concerns.
B) lack of net neutrality.
C) copyright complaints.
D) all of the above.
11.3 Fill in the Blank
1) ________ is a broad-based formula for how a business is going to accomplish its mission,
what its goals should be, and what plans and policies will be needed to carry out those goals.
2) In the ________ phase, the organization examines itself and its environment.
3) A company’s ________ is the benefit that a company’s products or services provide to a
company and its customers.
4) A(n) ________ refers to the unique combination of the resources and experiences of a
particular firm.
5) ________ means identifying business, technological, political, economic, and other relevant
trends that are currently affecting the business or that have the potential to do so in the future.
6) ________ involves scanning the business environment to collect and interpret relevant
information about direct competitors, indirect competitors, and potential competitors.
7) ________ is the continuous evaluation of progress toward the organization’s strategic goals,
resulting in corrective action and, if necessary, strategy reformulation.
8) A ________ is a business plan for a new initiative or large, new project inside an existing
organization.
9) A ________ is a specific, measurable standard against which actual performance is compared.
10) ________ are the quantitative expression of critically important metrics.
11) ________ is creations of the mind, such as inventions, literary and artistic works, and
symbols, names, images, and designs, used in commerce.
12) A ________ is an exclusive right of the author or creator of a book, movie, musical
composition, or other artistic property to print, copy, sell, license, distribute, transform to another
medium, translate, record, perform, or otherwise use.
13) The legal term for the use of the work without permission or contracting for payment of a
royalty is ________.
14) ________ is the branch of philosophy that deals with what is considered to be right and
wrong.
15) ________ is the right to be left alone and free of unreasonable personal intrusions.
17) ________ is a document that grants the holder exclusive rights to an invention for a fixed
number of years.
18) ________ is a form of applied ethics that examines ethical principles and moral or ethical
problems that arise in a business environment.
19) ________ is a business practice that gives consumers the opportunity to refuse to share
information about themselves.
20) ________ is the U.S. law that mandates the use of filtering technologies in schools and
libraries that receive certain types of federal funding.
21) A privacy concern that stems from the underground Internet of private online communities
are ________ that are only open to those who belong to the private network.
22) ________ is a protocol allowing Web sites to declare their intended use of information they
collect about users.
23) ________ is the study and practice of ecofriendly computing resources, and it is now a key
concern of business in all industries.
24) ________ begins with manufacturers producing environmentally friendly products and
encouraging IT departments to consider more friendly options like virtualization, power
management, and proper recycling habits.
25) The ________ is a searchable database of computer hardware that meets a strict set of
environmental criteria.
11.4 Essay
1) Define strategy. Describe the four major phases in the strategic planning process?
2) List seven suggestions for breaking down the barriers to global EC.
3) Identify three ways that information is collected about individuals on the Internet.
4) List five principles commonly applied to the collection and use of personal information.
5) List four trends that may slow EC and Web 2.0, and even cripple the Internet.