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Chapter 3 Strategy and Information Systems
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active revieW

Use this Active Review to verify that you understand the ideas redesign and describe the difference between the business pro-
and concepts that answer the chapter’s study questions. cesses in Figure 3-8 and those in Figure 3-9.

Q3-1 How does organizational strategy Q3-6 How does competitive strategy
determine information systems structure? determine business processes and the
structure of information systems?
Diagram and explain the relationship of industry structure,
competitive strategy, value chains, business processes, and infor- In your own words, explain how competitive strategy determines
mation systems. Working from industry structure to IS, explain the structure of business processes. Use the examples of a cloth-
how the knowledge you’ve gained in these first three chapters ing store that caters to struggling students and a clothing store
pertains to that diagram. that caters to professional businesspeople in a high-end neigh-
borhood. List the activities in the business process for the two
Q3-2 What five forces determine industry companies and create a chart like that in Figure 3-9. Explain
structure? how the information systems’ requirements differ between the
two stores.
Name and briefly describe the five forces. Give your own exam-
ples of both strong and weak forces of each type, similar to those Q3-7 How do information systems
in Figure 3-3.
provide competitive advantages?
Q3-3 How does analysis of industry List and briefly describe eight principles of competitive advan-
structure determine competitive strategy? tage. Consider your college bookstore. List one application of
each of the eight principles. Strive to include examples that
Describe four different strategies as defined by Porter. Give an involve information systems.
example of four different companies that have implemented
each of the strategies. Q3-8 2026?

Q3-4 How does competitive strategy Describe the ways that business strategies are likely to change
determine value chain structure? in the next 10 years. Using Google Glass as an example,
describe companies whose strategy is likely to be challenged.
Define the terms value, margin, and value chain. Explain why or- Summarize the lesson that gold mining on the Colorado River in
ganizations that choose a differentiation strategy can use value the 1850s can teach us.
to determine a limit on the amount of extra cost to pay for differ-
entiation. Name the primary and support activities in the value Using your Knowledge
chain and explain the purpose of each. Explain the concept of with Falcon Security
linkages.
Explain in your own words how Falcon Security's competi-
Q3-5 How do business processes tive strategy is threatened by relying on a few large industrial
generate value? accounts. Describe Falcon Security's planned response and sum-
marize the problems that Cam perceives with that response. Rec-
Define business process, cost, and margin as they pertain to busi- ommend a course of action for Falcon Security. Use Cam’s idea
ness processes. Explain the purpose of an activity and describe of diversifying the type of work the company does to illustrate
types of repository. Explain the importance of business process your answer.