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Computers and management midterm
Terms in this set (44)
- A process to fulfill a human purpose
- An assemblage of practices and components
Information System (IS)
Hardware, Software, data, procedures, people
-Integrated solution that combines five components: Hardware, Software, data, procedures, people who interact with and are impacted by the system
-transform data into information
Information technology (IT)
Hardware, software, data
Chapter 1 Key takeaways
-in the previous decades, tech firms created profound shifts in the ways firms advertise and individuals and organizations communicate
-new technologies have fueled globalization, redefined our concepts of software and computing, crushed costs, fueled data-driven decision making, and raised privacy and security concerns
People who started firms in their twenties
-Bill Gates, Mark Zuckerberg
Tech is everywhere...What professions?1
-Finance (i-banking IPOS and M&As), Accounting, Marketing (new channels- smartphones, TV, watches), Operations(Supply chain management, process redesign), HR, Law (patents, piracy),
How have the costs of entrepreneurship changed over the past decade?
Ideas can be vetted and prototyped and tested online
Funding can be crowdsourced
"The cloud" is transforming barriers to entry for start-ups
App stores: low/no-cost distribution channels present opportunities
for programmers to access millions of potential users
Software as a service
Tech-enabled emerging markets
The primacy of data across virtually all industries
-clothing company owned by Inditex
-high fashion for low cost
-constantly changing styles and products
-used technology to dominate the retail fashion industry as measured by sales, profitability, and growth.
-vertically integrated, no outsourcing
-7000+ stores in 93 countries
-sources its products relatively locally (Spain and Portugal as opposed to China), more expensive but shorter supply chain can react to changing trends
-no advertising budget. instead, money spend on buying storefronts next to luxury brands--> affordable luxury
-disadvantages: local natural disaster would impact deliveries, rising fuel costs b/c of frequent deliveries
-outsourcing production to 3rd party firms. Firms that DONT use contract manufacturers don't own the plants or directly employ workers who produce requested goods
-most think cheap contract manufacturing in developing countries can keep costs low, but because of increased competition, in order to have the low cost bid, firms must do illegal things such as employ child labor and skip on safety
coordinating and enabling the flow of goods, ppl, info, and other resources among locations
when a single firm owns several layers in its value chain
set of activities through which a product or service is created and delivered to customers
Limited production runs
-most products manufactured for a limited production run. while running out of best sellers could be seen as disaster, it delivers Zara several benefits :
Allows Zara to cultivate
exclusivity of its offerings.
Encourages customers to buy
right away and at full price.
Encourages customers to
Reduces the rate of failed
-small chip-based tags that wirelessly emit a unique identifying code for the item they are attached to.
Point of sale (POS) system
-the cash registers that ring up sales and deduct sold items from inventory.
-tells the firm what's selling
-track sales data
-usually linked to inventory systems to subtract sold items
Personal Digital Assistants (PDA)
-mobile computing devices
-Zara store managers
use PDAs/iPods to gather input about tastes and
preferences of the customers when they visit the stores.
How does Zara differ from other clothing stores in same price range?
Differences across Zara stores: within city, across
Messier than competitors like UNIQLO?
Variety of styles: work, casual, going out
Zaras located right across the street? Cornering
different styles/customer groups
Variation in customer experience across stores
Styles appearing at different stores periodically
Not recognizable, relatively unique styles
Clothing looks designer; copies high-end styles
Makes high fashion more accessible
Buy for the product, not for the brand (and save
Consistently reasonable/low prices
In what ways is Zara's market counterintuitive?
Usually don't run sales
-follow trends dont set them
-production costs higher
-tied to the euro--> as euro strengthened, production costs rise
When a single firm owns several layers in its value chain, it is said to be:
Zara books 85% of its products at full price compared to industry average markdown of 50%. How?
practice of having limited production runs of its designs
Due to limited production runs, Zara customers
visit the store more often
Sustained competitive advantage
Financial performance that consistently outperforms industry averages. Difficult to achieve due to the rapid emergence of new products and new competitors.
Performing the same tasks better than rivals perform them
What are the dangers of competing on operational effectiveness?
o "Sameness" is the danger facing firms that compete on operational effectiveness
o Tech can be easily acquired. The Fast Follower Problem occurs when rivals enter a market quickly with a comparable product at a lower cost
EX snap filters on other social media
Performing different tasks than rivals, or performing the same tasks differently
advantages related to size
economies of scale
-when the cost of an investment can be spread across increasing units of production or in serving growing customer base
cost a consumer entails when switching from one product to another
1. learning costs
2. info and data
when the value of a product increases as more ppl use it EX waze, Facebook
aka patent trolls
make money by buying and aquiring patents, not coming to market with their own ideas
-built through customer experience
-symbol of all things that company
The Long tail
Refers to an extremely large selection of content or products. The long tail is a phenomenon whereby firms can make money by offering a near limitless selection
Selection attract customers
Internet allows large selection inventories offline firms can't match
Netflix can't carry everything but always have something for someone
(1) selection attracts customers, and (2) the Internet allows large-selection inventory efficiencies that offline firms can't match.
Classification of software that monitors trends among customers and uses this data to personalize an individual customer's experiences
The rate at which customers leave a product or service
First Sale Doctrine
Ruling that states that a firm can distribute physical copies of legally acquired copyright-protected products.
Allows firms to lend or rent products.
Applicable only to the atoms of the physical product and not to the bits needed in streaming.
Netflix had Game of Thrones DVDs but can't stream it
reduction in the use of intermediaries between producers and consumers
chip performance per dollar doubles every 18 months
the part of the computer that executes the computer program
price elasticity in tech
as prices become cheaper, ppl buy more tech products
Identify the two characteristics of disruptive innovations.
First, they come to market with a set of performance attributes that existing customers don't value. Second, over time the performance attributes improve to the point where they invade established markets.
a standard for securely exchanging value and recording ownership over the Internet without an intermediary.
used to calculate the interest rate returned on an investment involving various positive and negative payments that are made on a regular basis
net present value
used to calculate the present value of a stream of possibly varying future cash flows
rate at which money changes value in a year
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