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from Managing and Using Information Systems textbook by Pearlson and Saunders


self-contained functional units


interrelated set of activities and tasks that turns inputs into outputs

business process reengineering (BPR)

radical way of transforming business processes

total quality management (TQM)

incremental way of transforming business processes

business process management (BPM) systems

systems that handle automated processes within and across organizations

enterprise systems

class of IT applications used to enable information flow within and between business processes

enterprise architecture

description of goals of an organization, how these goals are realized by business processes, and how these business processes can be better served through technology


the situation in which a company's current and emerging business strategy is enabled, supported, and unconstrained by technology


coordinated set of actions to fulfill objectives, purposes, and goals


clear and compelling statement of organization's purpose and what makes it unique

business strategy

plan of where a business seeks to go and how it plans to get there

cost leadership

strategy where organization aims to be the lowest-cost producer in the marketplace

competitive advantage

the unique set of features of a company and its products that are perceived by the target market as significant and superior to the competition


strategy where organization qualifies its product or service in a way that allows it to appear unique in the marketplace


strategy where organization limits its scope to a market segment and tailors its offerings to that group of customers using either cost or differentiation

shareholder value model

holds that the timing of the use of specialized knowledge can create a differentiation advantage as long as the knowledge remains unique

unlimited resources model

utilizes a large base of resources that allows organization to outlast competitors by practicing a differentiation strategy


suggests that speed and aggressiveness of the moves and countermoves create an environment in which advantages are rapidly created and eroded

D'aveni's model

speed and aggressive moves and coutermoves by a firm create competitive advantages

organizational strategy

includes organization's design and the choices it makes to define, set up, coordinate, and control its work processes

managerial levers

organizational, control, and cultural variables used by decision makers to effect changes in their organization

IS strategy

the plan an organization uses in providing information services

halo effect

the basic human tendency to make specific inferences on the basis of a general impression (EX: assuming that because a business is successful, it has good management-- ignoring other forces at work)

Porter's 5 Forces

threat of new entrants, bargaining power of buyers, threat of substitute products or services, bargaining power of suppliers, rivalry among existing competitors

customer relationship management (CRM)

activities designed to learn more about customers' needs and behaviors to develop stronger relationships with them and enhance their value chains

supply chain management (SCM)

improves the way a company finds raw components it needs to make a product or service, manufactures that product or service, and delivers it to customers

resource-based view

maintains that competitive advantage comes from the information resources of the firm; resources enable a firm to attain and sustain competitive advantage

strategic alliance

inter-organizational relationship that affords one or more companies in the relationship a strategic advantage

Ring and Van de Ven's stages of a strategic alliance

negotiation, commitment, execution, assessment

factors influencing value sustainability

ease of imitation, substitution, transfer


strategy where companies cooperate and compete at the same time with companies in its value net

value net

includes a company, its competitors, complementors, customers, suppliers


company who offers a complementary product (e.g. milk complements cereal)

business diamond

framework for understanding the design of an organization; links together business processes, values & beliefs, management control systems, and tasks & structures


data in context (i.e. with relevance and purpose)

Information Systems (IS)

technology, people, and processes that an organization uses to manage information

shared services

organizations restructure common business processes to consolidate services like IT, human resources, finance

enterprise resource planning

comprehensive software packages that incorporate all modules needed to run the operations of a business

Porter's Generic Strategies Framework

firms achieve competitive advantage through cost leadership, differentiation, or focus

service-oriented architecture

building components of software in a modular way; an architecture where business processes are built on a network, different parts of business functionality reside on different parts of the network, the parts can be combined and reused to create applications

layers of enterprise architecture

infrastructure, information, applications, processes, strategy


the open group architectural framework; designed to translate strategy into architecture and then into a detailed infrastructure using standardized Architecture Development Methodology

resource-based view vs. Porter's 5 Forces

resource-based focuses on internal factors in an organization,
Porter's five forces focuses on external factors in the industry

general process for developing IS

strategy --> architecture --> infrastructure

the business triangle

includes business, organizational, and information strategy; business strategy is at the top of the triangle because it guides the others

when business strategy changes

information and organizational strategy must also change

when information strategy changes

business strategy should not be affected because it is at a more abstract level


architecture where one software program (the client) requests and receives data and instructions from another software program (the server); computers running client programs usually require less computing resources

more specific sub-steps in process from strategy to architecture to infrastructure

strategy to goals to business requirements to architecture requirements to architecture to functional specifications to infrastructure specifications (hardware, software, data...)

six sigma

incremental approach to changing business processes (a management program that seeks to improve the quality of process outputs by identifying and removing the causes of defects and variation in the various processes.)

characteristics of a business process

inputs/outputs, tasks, decisions, metrics, "swim lanes"

two essential characteristics of a business process

inputs/outputs and tasks

more efficient processes have

fewer steps, fewer branches, fewer loops, and fewer decisions

difference between a process and a service

processes make services possible; processes have inputs and outputs, while service is a cycle (ongoing)

on a process flow diagram, a square represents a


on a process flow diagram, a diamond represents a


on a process flow diagram, a circle represents a


organizational change management

tries to minimize risks and maximize benefits of change in an organization

IS strategy triangle

relates business strategy with IS and organizational strategy; business strategy at the top, organizational and information strategy at the base


translates strategy into infrastructure, creating plans for the implementation


software program that requests and receives data and instructions from another


everything that supports the flow and processing of information in an organization, including hardware, software, data and network components

mainframe architecture

uses a large central computer that handles all the functionality of the system; common in legacy systems

configurations for IT architecture

mainframe, client/server, SOA, P2P, WOA

processes vs. functions

processes are horizontal across a corporation, many functional areas of the business will be involved in a process; functions are vertical silos in an organization (e.g. finance, operations, accounting, marketing, administration)


finance, operations, accounting, marketing, administration (functions or silos in a business)

information resources can either be..

assets or capabilities

information resources

includes data, technology, people, and processes

three major categories of IT capabilities

technical skills, IT management skills, relationship skills

value chain

highlights how IS add value to the primary and support activities of a firm's internal operations, customers, and supply chain

risks associated with using information systems to gain strategic advantage

awaking a sleeping giant, bad timing, poor implementation, failing to deliver what customers want, breaking the law

IT asset

anything that can be used by a firm in its processes for creating, producing, and/or offering its products

IT capability

something learned over time for the firm to create, produce, or offer its products

IT asset vs. capability

an IT capability makes it possible for the firm to use its IT assets effectively

network effects

the value of a network node to a person or organization in a network increases when others join the network

value chain framework

says competition stems from lowering the cost to perform activities and adding value so buyers will pay more

BPM (acronym)

business process management

ERP (acronym)

enterprise resource planning

SOA (acronym)

service-oriented architecture

CRM (acronym)

customer relationship management

SCM (acronym)

supply chain management

TQM (acronym)

total quality management

BPR (acronym)

business process re-engineering

when are business process management systems most useful?

when all the activities are in a predetermined order (not when steps vary in a process)

ES (abbreviation)

enterprise systems

the most frequently discussed type of enterprise system is...

... enterprise resource planning (ERP) software

what did enterprise systems replace?

software systems developed in the mid-90s which were not integrated across organizations and could not interface well with each other

what do ERPs help companies do?

manage fragmentation of information across an organization

most widely used enterprise system

R/3 (made by SAP)

ERPs make information available to...

all departments throughout a company

ERP II makes information available to...

external stakeholders

characteristics of enterprise systems

integration, packages, best practices, some assembly required, evolving

enterprise systems usually require...

long-term relationships with software vendors

why enterprise systems tie a company to a vendor

because they are complex and usually need continual modification to meet the organizations needs

best practices (characteristic of ES)

enterprise systems reflect industry best practices for generic business processes

enterprise systems need to be integrated with...

an organization's hardware, operating systems, databases, telecommunications, legacy systems


software used to connect processes in one or more computers across a network

major benefit of an enterprise system

allows functional areas of an organization to share information easily

enterprise systems are useful for this sort of organizational structure

centralization (because they focus on integration)

major disadvantage of an enterprise system

businesses have to conform to the system, sometimes have to redesign processes to fit system

disadvantages of enterprise system

for changes in organizational structure, expensive, risky

components of the high cost of enterprise systems

hardware, software, professional services, internal staff costs

WOA (acronym)

web-oriented architecture

P2P (acronym)


an end user will usually notice a reduction in the performance of a ______ before a _______

service, process

relationship between coopetition and strategic alliance

can have coopetition w/o strategic alliance, can have strategic alliance w/o coopetition

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