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QUESTIONS FOR REVIEW AND CRITICAL THINKING/ANSWERS
1. What is the difference between data, information, and intelligence?
Data are simply facts or recorded measures of certain phenomena (things or events); information
2. What are the characteristics of useful information?
Information can be evaluated by using four characteristics: relevance, quality, timeliness, and
completeness. Relevance is the characteristic of data reflecting how pertinent these particular
3. What is the key question distinguishing relevant data from irrelevant data?
Relevant data are facts about things that can be changed, and if they are changed, it will
4. Define knowledge management. What is its purpose within an organization?
Knowledge is a blend of previous experience, insight and data that form organizational memory.
5. What type of databases might be found in the following organizations?
a. Holiday Inn
Holiday Inn will have the standard accounting records, of course, but they will also have
information about the characteristics of each registered guest. They have the home address,
11
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or
posted to a publicly accessible website, in whole or in part.
Chapter Two: Information Systems and Knowledge Management 12
b. A major university’s athletic department
This organization can maintain data on overall attendance statistics and season ticket holders,
c. Anheuser-Busch
Anheuser-Busch would have information concerning all the different types of package sizes, sales
volume within regions, etc. Anheuser-Busch has a computerized shelf-space management
6. What type of operational questions could a delivery firm like FedEx expect to automate with
the company’s decision support system?
While business research can perform four possible functions (i.e., foundational, testing, issues,
and performance), the performance category is most likely of interest to FedEx. Performance
7. What makes a decision support system successful?
A decision support system (DSS) is a system that helps decision makers confront problems
8. What is data warehousing?
Data warehousing is the process allowing important day-to-day operational data to be stored and
9. [Internet Question] How does data warehousing assist decision making? Visit
http://www.kbb.com. While there, choose two cars that you might consider buying and
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or
posted to a publicly accessible website, in whole or in part.
Chapter Two: Information Systems and Knowledge Management 13
compare them. Which do you like the best? What would you do now? What are at least
three pieces of data that should be stored in a data warehouse somewhere based on your
interaction with Kelly Blue Book?
Data warehousing assists decision making by storing and organizing relevant data for simplified
10. [Internet Question] Give three examples of computerized databases that are available at your
college or university library.
The answers to this question will vary. However, most libraries will have ProQuest, ABI/Inform,
11. [Internet Question] What is the difference between the Internet and an intranet?
The Internet is a worldwide network of computers that allows users access to data, information,
and feedback from distant sources. The Internet has no central computer; instead, each message
12. Suppose a retail firm is interested in studying the effect of lighting on customer purchase
behavior. Which of the following pieces of information is the least relevant and why?
a. Amount of natural light in the store.
b. The compensation system for store salespeople.
c. The color of the walls in the store.
d. The type of lighting: fluorescent or incandescent.
It would seem that the compensation system for store salespeople would be the least relevant
13. [Internet Question] Imagine the data collected by eBay each day. List at least five types of
data that are collected through the daily operations. Describe each in terms of it illustrating
data, information, or intelligence. Make sure you list at least one example of each.
Possible data collected each day include the number of bids, the value of bids, the number of
sales, personal information on customers making purchases, the types of products most popular
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or
posted to a publicly accessible website, in whole or in part.
Chapter Two: Information Systems and Knowledge Management 14
14. How could New Balance, a maker of athletic shoes, use RFID technology to collect data?
The technology could be embedded in the shoes to logistically track the flow of goods from the
manufacturer to consumer. The technology could also be used to identify “real” New Balance
15. [Internet Question] The Spider’s Apprentice is a Web site that provides many useful tips
about using search engines. Go to http://www.monash.com/spidap.html then click on Search
Engine FAQ to learn the ins and outs of search engines.
RESEARCH ACTIVITIES
1. [Internet Question] To learn more about data warehousing, go to http://www.dwinfocenter.org.
2. [Internet Question] Use the Internet to see if you can find information to answer the
following questions:
a. What is the weather in Angers, France today?
b. What are four restaurants in the French Quarter in New Orleans?
c. What is the population of Brazil?
You can find the answers to all these using search engines such as Yahoo! or Google. For example,
CASE 2.1 Harvard Cooperative Society
Objective: To encourage students to appreciate the importance and usefulness of a decision
support system.
Summary: From his office window, Harvard Cooperative Society CEO, Jerry Murphy, can see
customers shopping. They make their way through the narrow aisles of the crowded department
store, picking up a sweatshirt here, trying on a baseball cap there, and checking out the endless
array of merchandise that bears the Harvard University insignia. Watching Murphy, you can well
imagine the Co-op’s founders, who started the store in 1882, peering through the tiny
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or
posted to a publicly accessible website, in whole or in part.
Chapter Two: Information Systems and Knowledge Management 15
windowpanes to keep an eye on the shop floor. Was the Harvard Square store attracting steady
traffic? Were the college students buying enough books and supplies for the Co-op to make a
profit? Back then, it was tough to answer those questions precisely. The owners had to watch and
wait, relying only on their gut feelings to know how things were going from minute to minute.
Now, more than a hundred years later, Murphy can tell you, down to the last stock-keeping unit,
how he’s doing at any given moment. His window on the business is the PC that sits on his desk. All
day long it delivers up-to-the-minute, easy-to-read electronic reports on what’s selling and what’s
not, which items are running low in inventory and which have fallen short of forecast. In a matter of
seconds, the computer can report gross margins for any product or supplier, and Murphy can decide
whether the margins are fat enough to justify keeping the supplier or product on board. “We were in
the 1800’s, and we had to move ahead,” he says of the $55 million business.
Questions
1. What is a decision support system? What advantages does a decision support system have for a
small business like the Harvard Cooperative Society?
A decision support system is a system that helps decision-makers confront problems through
A decision support system is a sophisticated software program that analyzes the data an executive
deems critical to his or her business and delivers the analyses to a computer screen as easy-to-read
2. How would the decision support system of a small business like the Harvard Cooperative
Society differ from that of a major corporation?
Decision support systems are not new. Large corporations have been using them for years. What’s
Both large and small companies have a database (a collection of information that is arranged in a
logical manner and organized in a form that can be stored and processed by a computer) and
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or
posted to a publicly accessible website, in whole or in part.
Chapter Two: Information Systems and Knowledge Management 16
3. Briefly outline the components of the Harvard Cooperative Society’s decision support system.
The Harvard Co-op clearly has a database and software in their decision support system. The focus
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or
posted to a publicly accessible website, in whole or in part.
