MIST 2090

Question 1

Machine

Answer 1

Machine: Rapidly increasing
and expanding capabilities of
machines

Question 2

Platform

Answer 2

Platform: Large and influential
young companies that bear
little resemblance to the
established incumbents in their
industries (yet are deeply
disrupting them!

Question 3

Crowd

Answer 3

Crowd: The startlingly large
amount of human knowledge,
expertise, and enthusiasm
distributed all over the world,
now able to be focused online

Question 4

AlphaGo

Answer 4

AlphaGo was not
programmed with
strategies and heuristics;
instead, it relied on a deep
learning system that could
learn them on its own
* Rule-based systems vs.
pattern recognition
systems

Question 5

Deep Learning

Answer 5

Deep Learning: Neural Network
- Tacit Knowledge: Feed Program
Inputs with Known Outcomes
(Train), then Allow Program to
Predict Outcomes when Not
Known

Question 6

Triple Revolution

Answer 6

Three lenses to understand how
technology is changing modern
businesses (p. 26):
* New combinations of minds and
machines are changing the way
businesses execute their most
important processes.
* Pioneering companies are bringing
together products and platforms to
transform their offerings.
* The core and the crowd are altering
what organizations themselves
look like, and how they work.

Question 7

Bits vs Molecules

Answer 7

A bit has no color, size,
or weight, and it can
travel at the speed of
light. It is the smallest
atomic element in the
DNA of information. For
practical purposes, we
consider a bit to be a 1
or a 0. The meaning of
the 1 or the 0 is a
separate matter.

Question 8

What is a
business model

Answer 8

A business model describes the
rationale of how an organization
creates, delivers, and captures
value

Question 9

________ receives signals from outside the computer and transfer them into the computer.

Answer 9

Input devices

Question 10

________ are systems that deal specifically with cash.

Answer 10

Cash management systems (CMSs)

Question 11

________ is the time between generating an idea for a product and completing a prototype that can be mass manufactured.

Answer 11

Time to market

Question 12

______ is a list of all raw materials and subcomponent demands to produce a product.

Answer 12

Bill of materials (BOM)

Question 13

________ combines material requirements planning (MRP) with other manufacturing-related activities to plan the entire manufacturing process.

Answer 13

Manufacturing resource planning (MRP II)

Question 14

________ allows computer to use telephone line as input. Caller ID can be used to locate customer data.

Answer 14

CTI

Question 15

Two economics concepts that shook everything up

Answer 15

Free, Perfect, Instant

Network Effects

Question 16

Free (in free, perfect, instant)

Answer 16

Free: Once something has been
digitized, it’s essentially free to make an additional copy of it

Question 17

Perfect (in free, perfect, Instant)

Answer 17

Perfect: Copies are every bit as good as their digital originals

Question 18

Instant (in free, perfect, instant)

Answer 18

Instant: Networks allow distribution of a free, perfect copy of information goods from one place to another virtually immediately

Question 19

Presenting information
goods in digital form (as
bits, rather than as atoms)
opens up new business
models….

Answer 19

Decentralized processing and
cloud computing
– Data collection and sharing
– Matching platforms O2O
(“sharing economy”)
– Scale issues (“winner take
all” economy)
– Versioning, bundling,
sampling, etc.

Question 20

For complementary
goods…. What does the supply and demand curve do

Answer 20

when the price
of good A goes down,
the demand curve of
good B shifts out
(meaning that demand
goes up)

Question 21

When inventory is perishable (e.g., class space, airplane seats, etc.) the marginal cost of filling the spaces can be

Answer 21

very low

Question 22

Why Platform economics matters

Answer 22

Platforms own fewer physical assets
—mostly software and algorithms

Platforms generate huge revenues
by matching buyers and sellers

They benefit from the chicken-or-
egg problem, which gives significant
market power to incumbents

Applying the underlying economics
to your business models can be
incredibly powerful!