IT Empowers Business Organization

Question 1

What model can a firm use to identify valuable customers?

Answer 1

The RFM model.
Recency
Frequency
Monetary contribution

Question 2

What is one performance measure an organization can use to measure its business process execution?

Answer 2

Internal TQC perspective.
Time
Quality
Cost

Question 3

What are some business values of IT?

Answer 3

1. Cost reduction through technology-enabled automation.
2. Improve firm competitiveness by using IT as a strategic driver.
3. Empowerment to customers, suppliers, and employees/managers.
4. Operations excellence by increasing organization effectiveness & efficiency in decision making, planning, operations communications & coordination.
5. Accelerate organization’s information velocity to become more agile, adaptive, & competitive.
6. Effective CRM for customer intimacy.
7. Enhance supply chain integration for performance improvement.
8. Enable new product development, service design, & business models.

Question 4

What is an enterprise resource planning (ERP) system?

Answer 4

An ERP system is process-oriented & serves as the organization’s integrated IT backbone to support various business processes, operations, tasks, and decision-making.

Question 5

What is the difference between a distributed IT budget and a centralized IT budget methods?

Answer 5

A distributed IT budget is one in which the IT budget is distributed among the different departments, where the beneficiary pays the cost of IT. This differs from the centralized method where there is an IT budget that the IT department uses to pay for all IT related services. In the distributed method the IT department is seen as a “revenue center” and in the centralized method the IT department is seen as a “cost center”.

Question 6

What is the IT manager reporting structure?

Answer 6

This is an organization’s structure on how it views IT. Does it see IT as a strategic driver or as support? It is also an organization’s structure on how IT is reported and implemented. It answers the who does the IT manager report to.

Question 7

What is the difference between a centralized IT organization structure and a hybrid IT organization structure?

Answer 7

A centralized structure is one in which the IT is seen as its own department and is isolated from other departments. The hybrid structure differs in that IT is seen as an important part of all parts of the business and the IT department is interconnected with all other departments.