Management Information Systems, 14e (Laudon)
Chapter 3 Information Systems, Organizations, and Strategy
1) The interaction between information systems and organizations is influenced
A) primarily by the decision making of middle and senior managers.
B) by the development of new information technologies.
C) by many factors, including structure, politics, culture, and environment.
D) by two main microeconomic forces: capital and labor.
E) by management decisions.
2) An organization is a
A) stable, formal social structure that takes resources from the environment and processes them
to produce outputs.
B) formal, legal entity with internal rules and procedures that must abide by laws.
C) a collection of people and other social elements.
D) B and C
E) A, B, and C
3) An organization is seen as a means by which primary production factors are transformed into
outputs consumed by the environment according to the ________ definition of organizations.
A) microeconomic
B) macroeconomic
C) sociotechnical
D) behavioral
E) psychological
4) How does the technical view of organizations fall short of understanding the full impacts of
information systems in a firm?
A) It sees information systems as a way to rearrange the inputs and outputs of the organization.
B) It sees capital and labor as primary production factors.
C) It sees an organization as a collection of rights, privileges, obligations, and responsibilities.
D) It sees the organization as a social structure similar to a machine.
E) It sees the inputs and outputs, labor and capital, as being infinitely malleable.
5) Which of the following is not a major feature of organizations that impacts the use of
information systems?
A) business processes
B) environments
C) goals
D) agency costs
E) leadership styles
6) Business processes are collections of
A) informal practices and behaviors.
B) formalized and documented practices.
C) business rules.
D) rights and privileges.
E) routines.
7) All of the following are considered disruptive technologies except
A) instant messaging.
B) e-mail.
C) Internet telephony.
D) PCs.
E) smartphones.
8) Under Mintzberg’s classification of organizational structure, the knowledge-based
organization where goods and services depend on the expertise and knowledge of professionals
falls under the category of
A) entrepreneurial structures.
B) divisionalized bureaucracies.
C) professional bureaucracies.
D) adhocracies.
E) machine bureaucracies.
9) Mintzberg classifies a large bureaucracy existing in a slowly changing environment that
produces standard products and is dominated by centralized management as a ________
bureaucracy.
A) machine
B) professional
C) divisionalized
D) multidivisional
E) ad hoc
10) An example of a divisionalized bureaucracy is a
A) startup firm.
B) university.
C) Fortune 500 firm.
D) midsize manufacturer.
E) consulting firm.
11) Along with capital, ________ is the primary production input that the organization uses to
create products and services.
A) structure
B) culture
C) politics
D) natural resources
E) labor
12) The divergent viewpoints about how resources, rewards, and punishments should be
distributed, and the struggles resulting from these differences are known as
A) culture.
B) politics.
C) structure.
D) viewpoints.
E) variance.
13) ________ technologies radically change the business landscape and environment.
A) Explosive
B) Inventive
C) Disruptive
D) Subversive
E) Divisive
14) Some organizations lack bedrock, unassailable assumptions that define their goals and
products.
15) A professional bureaucracy is a knowledge-based organization where goods and services
depend on the expertise and knowledge of professionals.
16) Routines are also called standard operating procedures.
17) How are the technical and behavioral definitions of an organization different?
18) When a firm buys on the marketplace what it cannot make itself, the costs incurred are
referred to as
A) switching costs.
B) network costs.
C) procurement.
D) agency costs.
E) transaction costs.
19) All of the following statements are true about information technology’s impact on business
firms except
A) it helps firms expand in size.
B) it helps firms lower the cost of market participation.
C) it helps reduce internal management costs.
D) it helps reduce transaction costs.
E) it helps reduce agency costs.
20) According to agency theory, the firm is viewed as a(n)
A) unified, profit-maximizing entity.
B) task force organization that must respond to rapidly changing environments.
C) entrepreneurial endeavor.
D) “nexus of contracts” among self-interested individuals.
E) entrepreneurial structure.
21) According to research on organizational resistance, the four components that must be
changed in an organization in order to successfully implement a new information system are
A) environment, organization, structure, and tasks.
B) technology, people, culture, and structure.
C) organization, culture, management, and environment.
D) tasks, technology, people, and structure.
E) costs, tasks, structure, and management.
22) Information systems technology can be viewed as a factor of production that can be
substituted for traditional capital and labor from the point of view of economics.
23) List three organizational factors that can prevent a firm in fully realizing the benefits of a
new information system, and provide examples for each.
24) As discussed in the chapter opening case, which of the four generic strategies did T.J. Maxx
employ to combat the competition offered by Target, Kohls, Walmart, Macy’s and pure online
stores likeRue LaLa and Gilt Groupe?
A) market niche focus
B) customer and supplier intimacy
C) network-based strategy
D) product synergies
E) efficient customer response
25) Which model is used to describe the interaction of external forces that affect an
organization’s strategy and ability to compete?
A) network economics model
B) competitive forces model
C) competitive advantage model
D) demand control model
E) agency costs model
26) Which of the following industries has a low barrier to entry?
A) automotive
B) computer chip
C) national retailer
D) airline
E) restaurant
27) All of the following are competitive forces except
A) suppliers.
B) new market entrants.
C) external environment.
D) customers.
E) substitute products.
28) A manufacturer of deep-sea oil rigs may be least concerned about this marketplace force.
A) product differentiation
B) traditional competitors
C) low number of suppliers
D) new market entrants
E) low number of customers
29) A substitute product of most concern for a cable TV distributor is
A) satellite TV.
B) broadcast TV.
C) satellite radio.
D) the Internet.
E) terrestrial radio.
30) Walmart’s attempts to increase its online presence is an example of a firm using information
systems to
A) strengthen ties to its customers.
B) simplify the industry value chain.
C) develop synergies.
D) focus on market niche.
E) achieve low-cost leadership.
31) A firm can exercise greater control over its suppliers by having
A) more suppliers.
B) fewer suppliers.
C) global suppliers.
D) local suppliers.
E) regional suppliers.
32) Amazon’s use of the Internet as a platform to sell books more efficiently than traditional
bookstores illustrates a use of information services for
A) low-cost leadership.
B) marketing effectiveness.
C) focusing on market niche.
D) strengthening supplier intimacy.
E) developing synergies.
33) The four major competitive strategies are
A) low-cost leadership, substitute products and services, customers; and suppliers.
B) low-cost leadership, product differentiation, focus on market niche, and customer and supplier
intimacy.
C) new market entrants, substitute products and services, customers, and suppliers.
D) low-cost leadership, new market entrants, product differentiation, and focus on market niche.
E) customers, suppliers, new market entrants, and substitute products.
34) Walmart’s continuous replenishment system allows it to
A) provide mass customization.
B) differentiate products.
C) strengthen customer intimacy.
D) achieve economy of scale.
E) achieve low-cost leadership.
35) Firms use a ________ strategy to provide a specialized product or service for a narrow target
market better than competitors.
A) product differentiation
B) market niche
C) mass customization
D) process efficiency
E) low-cost leadership
36) The ability to offer individually tailored products or services using the same production
resources as bulk production is known as
A) customized response.
B) size customization.
C) magnitude customization.
D) dimension customization.
E) mass customization.
37) In environmental scanning, a firm may use information systems to
A) utilize sensors that track products through the value chain.
B) analyze external Internet traffic to its Web sites.
C) identify external events that may affect it.
D) understand its carbon footprint and energy impacts on the environment.
E) develop a unified organizational culture.
38) Nike’s forays into information technology represent an effort to
A) maintain low-cost leadership.
B) focus on market niche.
C) strengthen customer and supplier intimacy.
D) perform intensive customer data analysis.
E) achieve product differentiation.
39) Which of the following best illustrates the use of information systems to focus on market
niche?
A) A car manufacturer’s Web site that lets you customize the features on the car you are
purchasing.
B) A restaurant chain analyzing local sales figures to determine which menu items to serve.
C) A bookseller selling an e-book reader that reads only the bookseller’s books.
D) A department store creating specialized products for preferred customers.
E) A clothes manufacturer expanding its offerings to new styles.
40) All of the following are IT-enabled products and services providing competitive advantage
except
A) Amazon’s one-click shopping.
B) Apple’s iPod and iTunes.
C) Ping’s golf club customization.
D) PayPal’s online person-to-person payment system.
E) Walmart’s RetailLink system.
41) The Internet raises the bargaining power of customers by
A) creating new opportunities for building loyal customer bases.
B) making more products available.
C) making information available to everyone.
D) lowering transaction costs.
E) enabling the development of new services.
42) All of the following industries have been disrupted by the Internet except
A) encyclopedias.
B) newspapers.
C) music.
D) air travel.
E) clothing.
43) A competitive force challenging the publishing industry is
A) positioning and rivalry among competitors.
B) low cost of entry.
C) substitute products or services.
D) customers’ bargaining power.
E) suppliers’ bargaining power.
44) The value chain model
A) categorizes five related advantages for adding value to a firm’s products or services.
B) sees the supply chain as the primary activity for adding value.
C) categorizes four basic strategies a firm can use to enhance its value chain.
D) highlights specific activities in the business where competitive strategies can best be applied.
E) enables more effective product differentiation.
45) Which of the following represent the primary activities of a firm?
A) inbound logistics, operations, outbound logistics, sales and marketing, and service
B) inbound logistics, operations, outbound logistics, technology, and service
C) procurement, inbound logistics, operations, technology, and outbound logistics
D) procurement, operations, technology, sales and marketing, and services
E) organization infrastructure, human resources, technology, and procurement
46) Which of the following is one of the support activities in a firm’s value chain?
A) inbound logistics
B) operations
C) sales and marketing
D) service
E) technology
47) An activity businesses perform to measure and compare business processes to similar
processes of other companies within their industry is
A) benchmarking.
B) best practices.
C) value chain analysis.
D) strategic systems analysis.
E) secondary activities.
48) What are the most successful solutions or methods for achieving a business objective?
A) value activities
B) best processes
C) core competencies
D) best practices
E) benchmarks