Chapter 14

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The principal capital budgeting models for evaluating information technology projects are the payback method, the accounting rate of return on investment (ROI), the net present value, and the

future present value

internal rate of return.

external rate of return.

ROPM.

internal rate of return.

Intangible benefits cannot be immediately quantified but may lead to quantifiable gains in the long run.

True

False

True

________ are all tangible benefits of information systems.

Improved asset utilization, increased organizational learning, and improved operations

Reduced workforce, lower outside vendor costs, and increased productivity

Increased productivity, reduced workforce, and increased job satisfaction

Lower operational costs, improved resource control, and more information

Reduced workforce, lower outside vendor costs, and increased productivity

________ are all intangible benefits of information systems.

Improved asset utilization, increased organizational learning, and improved operations

Reduced workforce, lower outside vendor costs, and increased productivity

Increased productivity, reduced workforce, and increased job satisfaction

Lower operational costs, improved resource control, and more information

Improved asset utilization, increased organizational learning, and improved operations

The central method used in a portfolio analysis is to

inventory all of the organization's information systems projects and assets.

perform a weighted comparison of the criteria used to evaluate a system.

survey a large sample of managers on their objectives, decision-making process, and uses and needs for data and information.

interview a small number of top managers to identify their goals and criteria for achieving success.

inventory all of the organization's information systems projects and assets.

The ________ is directly responsible for the individual systems project.

project management group

project team

IS steering committee

corporate strategic planning committee

project team

An example of using an external integration tool would be to:

define task dependencies.

include user representatives as active members of the project team.

create a PERT chart.

hold frequent project team meetings.

include user representatives as active members of the project team.

Which of the following tools would you use to control risk factors in an information systems project?

internal integration tools

external integration tools

formal planning tools and formal control tools

all of these

all of these

In sociotechnical design

separate sets of technical and social design solutions are developed and compared.

ergonomic features of a system and the system's technical design are given equal importance.

systems analysts with proven backgrounds in sociological concerns rate and compare a system's social and technical aspects.

all of these.

separate sets of technical and social design solutions are developed and compared.

In working with ROPMs and options valuation, a financial option is a(n)

obligation to purchase an asset at a later date at a fixed price.

obligation to either purchase or sell an asset at a later date at a strike price.

right to purchase an asset a later date at a strike price.

right to purchase or sell an asset a later date at a fixed price.

right to purchase or sell an asset a later date at a fixed price.

In CFS analysis, it is important to

interview as many employees from different levels of the company as possible

create a broad inquiry into the various types of information used in the company.

distinguish between organizational and individual CSFs.

identify operational managers that can accurately portray the day-to-day information needs of the firm.

distinguish between organizational and individual CSFs.

Which of the following tools may help identify risk areas associated with employee acceptance of a new information system?

formal planning and control tools

organizational impact analysis

system prototype

feasibility study

organizational impact analysis

One example of an implementation problem is

poor user interface.

inadequate user training.

project running over budget.

changes in job activities and responsibilities.

inadequate user training.

On average, private sector IT projects underestimated budget and delivery time of systems by ________ percent.

30

40

50

60

50

When using a capital budgeting method in measuring the worth of an information system, which of the following related costs would you use to assess the cash inflow?

increased sales of products

hardware and software expenditures

labor expenditures

reduced costs in production and operation

both increased sales of products and reduced costs in production and operation

both hardware and software expenditures and labor expenditures

increased sales of products, hardware and software expenditures, labor expenditures and reduced costs in production and operation

both increased sales of products and reduced costs in production and operation

To review a project's tasks and their interrelationships, you would use a

PERT chart.

Gantt chart.

Either PERT chart or Gantt chart.

Neither PERT chart nor Gantt chart.

PERT chart.

According to your reading of the chapter, change management is a process that

should be addressed before a project is developed

begins when a project is implemented.

is used primarily to mandate user acceptance.

must be addressed in all systems development.

should be addressed before a project is developed.

The central method used in a scoring model is to

inventory all of the organization's information systems projects and assets.

perform a weighted comparison of the criteria used to evaluate a system.

survey a large sample of managers on their objectives, decision-making process, and uses and needs for data and information.

interview a small number of top managers to identify their goals and criteria for achieving success.

perform a weighted comparison of the criteria used to evaluate a system.

The systems analyst is the catalyst for the entire change process and is responsible for making sure that everyone involved accepts the changes created by a new system.

True

False

True

An information system project's scope is directly related to its business requirements.

True

False

True

More timely information is a tangible benefit of information systems.

True

False

False

The goal of sociotechnical design is to create systems with better user interfaces and contribute to fewer health issues.

True

False

False

Which of the following types of projects is most likely to fail?

integration of an third-party automated payment system

replacement of middleware with Web services for legacy application integration

a business process redesign project that restructures workflow and responsibilities

redesigning a user interface to an online investment site

a business process redesign project that restructures workflow and responsibilities

In using a portfolio analysis to determine which IT projects to pursue, you would

select the most low-risk projects from the inventory.

limit work to those projects with great rewards.

select only low-risk, high-reward projects.

balance high-risk, high reward projects with lower-risk projects.

balance high-risk, high reward projects with lower-risk projects.

The design of jobs, health issues, and the end-user interface of information systems are all considerations in the field of ergonomics.

True

False

True

The major variables in project management are

scope, time, cost, and performance.

scope, time, cost, quality, and risk.

time, cost, quality, performance, and risk.

time, cost, scope, and performance.

scope, time, cost, quality, and risk.

The principle method used in CFS analysis is to

inventory all of the organization's information systems projects and assets and assign risk levels.

perform a weighted comparison of the criteria used to evaluate a system.

survey a large sample of managers on their objectives, decision-making process, and uses and needs for data and information.

interview a small number of top managers to identify their goals and criteria for achieving success.

interview a small number of top managers to identify their goals and criteria for achieving success.

Users prefer systems that

are oriented to facilitating organizational tasks and solving business problems.

work with existing DBMS.

are able to provide optimum hardware and software efficiency.

are capable of storing much more data than they need.

are oriented to facilitating organizational tasks and solving business problems.

The project risk will rise if the project team and the IS staff lack

legacy applications as a starting point.

good equipment.

the required technical expertise.

financial studies and plans.

the required technical expertise.

ROPMs value information systems similar to stock options, in that

ROPMs can be bought and sold like stocks.

a company's worth can be evaluated by the worth of their ROPMs.

initial expenditures on IT projects are seen as creating the right to pursue and obtain benefits from the system at a later date.

expenditures and benefits from IT projects are seen as inflows and outflows of cash that can be treated themselves like options.

initial expenditures on IT projects are seen as creating the right to pursue and obtain benefits from the system at a later date.

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