Chapter 02 Strategic Decision Making Multiple Choice Questions



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Chapter 02

Strategic Decision Making

 


Multiple Choice Questions
 

1. Which of the following is not a reason for the growth of decision-making information systems? 


A. People need to analyze large amounts of information
B. People must make decisions quickly
C. People must apply sophisticated analysis techniques to make good decisions
D. People no longer have to worry about protecting the corporate asset of organizational information

People must protect the corporate asset of organizational information, it is one of their competitive advantages.

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Easy
Taxonomy: Knowledge & Understanding
 

2. What are the most sought after traits in up-and-coming executives? 


A. Decision-making and transactional skills
B. Problem-solving and flexibility
C. Decision-making and problem-solving
D. Problem-solving and transaction skills

The most sought after traits in up-and-coming executives are decision-making and problem-solving.

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Medium
Taxonomy: Knowledge & Understanding
 

3. What factor significantly contributed to people's needs to use information systems to make decisions? 


A. The amount of information people must understand to make good decisions is increasing exponentially
B. The amount of information people must understand to make good decisions is decreasing exponentially
C. The amount of information people must understand to make good decisions has remained unchanged
D. Impossible to answer as it depends on the industry

The amount of information people must understand to make good decisions is increasing exponentially

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Medium
Taxonomy: Knowledge & Understanding
 

4. How do decision-making information systems work? 


A. By building models out of organizational information to lend insight into important business issues and opportunities
B. By building models out of transactional information only to lend insight into important business issues and opportunities
C. By building models out of analytical information only to lend insight into important business issues and opportunities
D. None of the above

Decision-making information systems work by building models out of organizational information to lend insight into important business issues and opportunities

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Medium
Taxonomy: Knowledge & Understanding
 

5. Which of the following is a not a type of organizational information system? 


A. Executive information system
B. Decisions support system
C. Analysis processing system
D. Transactional processing system

Analysis processing system is not a type of organizational IS.

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Medium
Taxonomy: Knowledge & Understanding
 

6. What can a model accomplish? 


A. Calculate risks
B. Understand uncertainty
C. Manipulate time
D. All of the above

A model can do all of the above.

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Medium
Taxonomy: Knowledge & Understanding
 

7. Which of the following is a quantitative model typically used by a DSS? 


A. Sensitivity analysis
B. What-if analysis
C. Goal-seeking analysis
D. All of the above

A DSS can perform all of the above.

 


AACSB: Use of Information Technology
Learning Outcome: 2.3
Level: Easy
Taxonomy: Knowledge & Understanding
 

8. What is the study of the impact that changes in one (or more) parts of the model have on other parts of the model? 


A. Drill-down
B. Sensitivity analysis
C. Statistical analysis
D. Goal-seeking analysis

This is the definition of sensitivity analysis.

 


AACSB: Use of Information Technology
Learning Outcome: 2.3
Level: Easy
Taxonomy: Knowledge & Understanding
 

9. What finds the inputs necessary to achieve a goal, such as a desired level of output? 


A. Drill-down
B. Sensitivity analysis
C. What-if analysis
D. Goal-seeking analysis

This is the definition of goal-seeking analysis.

 


AACSB: Use of Information Technology
Learning Outcome: 2.3
Level: Easy
Taxonomy: Knowledge & Understanding
 

10. What is consolidation? 


A. Involves the aggregation of information and features simple roll-ups to complex groupings of interrelated information.
B. The ability to look at information from different perspectives
C. Enables users to get details, and details of details, of information
D. Finds the inputs necessary to achieve a goal such as a desired level of output

This is the definition of consolidation.

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Easy
Taxonomy: Knowledge & Understanding
 

11. What is drill-down capability? 


A. Involves the aggregation of information and features simple roll-ups to complex groupings of interrelated information.
B. The ability to look at information from different perspectives
C. Enables users to get details, and details of details, of information
D. Finds the inputs necessary to achieve a goal such as a desired level of output

This is the definition of drill-down.

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Easy
Taxonomy: Knowledge & Understanding
 

12. What is slice-and-dice capability? 


A. Involves the aggregation of information and features simple roll-ups to complex groupings of interrelated information.
B. The ability to look at information from different perspectives
C. Enables users to get details, and details of details, of information
D. Finds the inputs necessary to achieve a goal such as a desired level of output

This is the definition of slice-and-dice.

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Easy
Taxonomy: Knowledge & Understanding
 

13. What integrates information from multiple components and tailors the information to individual preferences? 


A. Drill-down
B. Sensitivity analysis
C. What-if analysis
D. Digital dashboard

This is the definition of digital dashboards.

 


AACSB: Use of Information Technology
Learning Outcome: 2.4
Level: Easy
Taxonomy: Knowledge & Understanding
 

14. What are various commercial applications of artificial intelligence? 


A. Drill-down
B. Sensitivity analysis
C. Digital dashboard
D. Intelligent system

This is the definition of intelligent systems.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

15. What is a category of AI that attempts to emulate the way the human brain works? 


A. Intelligent system
B. Artificial intelligence
C. Expert systems
D. Neural network

This is the definition of neural network.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

16. Which of the following is the most commonly used form of AI in the business arena? 


A. Intelligent system
B. Artificial intelligence
C. Expert system
D. Neural network

Expert systems are the most common.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Medium
Taxonomy: Knowledge & Understanding
 

17. What is a special-purpose knowledge-based information system that accomplishes specific tasks on behalf of its users? 


A. Intelligent system
B. Artificial intelligence
C. Neural network
D. Intelligent agent

This is the definition of intelligent agent.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Medium
Taxonomy: Knowledge & Understanding
 

18. What is the ultimate goal of AI? 


A. Perform advanced transactional processing
B. Mimic human intelligence
C. Build and execute models
D. All of the above

The ultimate goal of AI is to mimic human intelligence.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Medium
Taxonomy: Knowledge & Understanding
 

19. Which of the following can an AI system perform? 


A. Learn or understand from experience
B. Make sense of ambiguous or contradictory information
C. Use reasoning to solve problems and make decisions effectively
D. All of the above

AI systems can perform all of the above.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Medium
Taxonomy: Knowledge & Understanding
 

20. What is an artificial intelligence system that mimics the evolutionary, survival-of-the-fittest process to generate increasingly better solutions to a problem? 


A. Intelligent system
B. Artificial intelligence
C. Neural network
D. Genetic algorithm

This is the definition of genetic algorithm.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

21. What can AI scientists learn by observing parts of the ecosystem, like ant or bee colonies, and using hardware and software models that incorporate insect characteristics and behavior? 


A. Learn how people-based systems behave
B. Predict how they will behave under a given set of circumstances
C. Improve human systems to make them more efficient and effective
D. All of the above

All of the above are learned by AI scientists.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

22. Which form of AI is widely used for environmental scanning and competitive intelligence? 


A. Genetic algorithms
B. Artificial intelligence
C. Neural network
D. Intelligent agents

Intelligent agents are widely used for environmental scanning and competitive intelligence.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

23. What do cargo transport systems, book distribution centers, the video game market, a flu epidemic, and an ant colony have in common? 


A. They are all expert systems and thus share some characteristics
B. They are all genetic algorithm systems and thus share some characteristics
C. They are all neural network systems and thus share some characteristics
D. They are all complex adaptive systems and thus share some characteristics

They are all complex adaptive systems and thus share some characteristics.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

24. Which of the following represents the top-down (executives to analysts) organizational levels of information technology systems? 


A. TPS, DSS, EIS
B. DSS, TPS, EIS
C. EIS, DSS, TPS
D. None of the above, it varies from organization to organization

Executive information systems, decision support systems, and transaction processing systems is the top-down organizational levels of information technology systems.

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Easy
Taxonomy: Knowledge & Understanding
 

25. Which of the following is an incorrect enterprise view of information technology? 


A. Processes are analytical for executives and transactional for analysts
B. Granularity is coarse for executives and fine for analysts
C. Processing is OLTP for executives and OLAP for analysts
D. None of the above

Processing is OLAP for executives and OLTP for analysts.

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Medium
Taxonomy: Knowledge & Understanding
 

26. What type of AI system is best for making decisions including identifying patterns or image recognition? 


A. Genetic algorithms
B. Artificial intelligence
C. Neural network
D. Intelligent agents

Neural networks are best for identifying patters and image recognition

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Hard
Taxonomy: Knowledge & Understanding
 

27. Which industry has been relying on neural network technology for over two decades? 


A. Food service
B. Hotels
C. Finance
D. Healthcare

Finance has been relying on neural network technology for over two decades.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Hard
Taxonomy: Knowledge & Understanding
 

28. Which type of AI system assigns values of 0 and 1 to vague or ambiguous information? 


A. Genetic algorithms
B. Artificial intelligence
C. Fuzzy logic
D. Intelligent agents

Fuzzy logic systems assign values of 0 and 1 to vague and ambiguous information.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Medium
Taxonomy: Knowledge & Understanding
 

29. Which system differentiates an executive information system from a decision support system and a transaction processing system? 


A. Order processing system
B. Manufacturing system
C. Stock market information system
D. Transportation system

A stock market information system is only found in an executive information system since it is an external source of information, the rest are internal sources of information.

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Hard
Taxonomy: Knowledge & Understanding
 

30. Which company has "The Wall of Shaygan", which is a digital dashboard that tracks 100-plus IT systems on a single screen? 


A. Burlington Northern and Santa Fe Railroad
B. BostonCoach
C. Verizon Communications
D. RivalWatch

Verizon Communications has The Wall of Shaygan.

 


AACSB: Use of Information Technology
Learning Outcome: 2.4
Level: Hard
Taxonomy: Knowledge & Understanding
 

31. Which company offers a strategic business information service using artificial intelligence that enables organizations to track the product offering, pricing policies, and promotions of online competitors? 


A. Burlington Northern and Santa Fe Railroad
B. BostonCoach
C. Verizon Communications
D. RivalWatch

RivalWatch offers the above service.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

32. Which of the following represents a mathematical method of handling imprecise or subjective information? 


A. Genetic algorithm
B. Fuzzy logic
C. Market basket analysis
D. Statistical analysis

This is the definition of fuzzy logic.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

33. What is the process called when waiting in line at the grocery store? 


A. Delivery of information
B. Order
C. Checkin
D. Checkout

Waiting in line at the grocery store is the process of checkout.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

34. Which of the following are types of environmental business processes? 


A. Environmental protection
B. Hazardous waste management
C. Air/water/soil resource management
D. All of the above

These are all forms of environmental business processes.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

35. Which of the following are types of management information system business processes? 


A. Disaster recovery procedures
B. Backup/recovery procedures
C. Service agreements
D. All of the above

These are all forms of MIS business processes.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

36. Which of the following should a business follow for success? 


A. Technology choices should drive business processes
B. Business processes should drive technology choices
C. Technology choices should drive business strategies and goals
D. All of the above depending on the industry

Business processes should drive technology choices.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Medium
Taxonomy: Knowledge & Understanding
 

37. What does BPR assume about the current process in the extreme? 


A. Current process is irrelevant
B. Current process is broken
C. Current process must be overhauled from scratch
D. All of the above

BPR in the extreme assumes the current process is irrelevant, broken, or overhauled.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Medium
Taxonomy: Knowledge & Understanding
 

38. Which of the following is an example of a business process? 


A. Ordering clothes from mail-order companies
B. Developing new products
C. Building a new home
D. All of the above

All of the above are examples of business processes.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

39. Examining business processes can help an organization achieve all of the following, except: 


A. Determine bottlenecks
B. Eliminate duplicate activities
C. Identify smooth running processes
D. Separate related activities

Examining business processes can help an organization combine related activities.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

40. Which type of model represents the current state of the operation that has been mapped, without any specific improvements or changes to existing processes? 


A. As-Is process model
B. To-Be process model
C. Continuous process model
D. Depends on the individual situation

This is the As-Is process model.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

41. Which type of model shows the results of applying change improvement opportunities to the current process model? 


A. As-Is process model
B. To-Be process model
C. Continuous process model
D. Depends on the individual situation

This is the To-Be process model.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

42. What encompasses all of the information contained within a single business process or unit of work and its primary purpose is to support the performing of daily operational tasks? 


A. Transactional information
B. Analytical information
C. Timeliness
D. Quality

This is the definition of transactional information.

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Easy
Taxonomy: Knowledge & Understanding
 

43. Which of the following is an example of transactional information? 


A. Withdrawing cash from an ATM
B. Making an airline reservation
C. Purchasing stock
D. All of the above

All of the above are examples of transactional information

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Medium
Taxonomy: Knowledge & Understanding
 

44. What encompasses all organizational information and its primary purpose is to support the performing of managerial analysis tasks? 


A. Transactional information
B. Analytical information
C. Timeliness
D. Quality

This is the definition of analytical information.

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Easy
Taxonomy: Knowledge & Understanding
 

45. Which of the following is an example of transactional information? 


A. Trend projection
B. Sales projection
C. Purchasing stock
D. All of the above

Purchasing stock is an example of transactional information

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Medium
Taxonomy: Knowledge & Understanding
 

46. Which of the following is an example of analytical information? 


A. Trend projection
B. Sales projection
C. Product statistics
D. All of the above

All of the above are examples of analytical information.

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Medium
Taxonomy: Knowledge & Understanding
 

47. What is a business process? 


A. The analysis and redesign of workflow within and between enterprises
B. A standardized set of activities that accomplish as specific task, such as processing a customer's order
C. Integrates all departments and functions throughout an organization into a single TI system so that employees can make decisions by viewing enterprisewide information on all business operations
D. None of the above

This is the definition of business process.

 


AACSB: Use of Information Technology
Learning Outcome: 2.6
Level: Easy
Taxonomy: Knowledge & Understanding
 

48. What is business process reengineering? 


A. The analysis and redesign of workflow within and between enterprises
B. A standardized set of activities that accomplish as specific task, such as processing a customer's order
C. Integrates all departments and functions throughout an organization into a single TI system so that employees can make decisions by viewing enterprisewide information on all business operations
D. None of the above

This is the definition of BPR.

 


AACSB: Use of Information Technology
Learning Outcome: 2.8
Level: Easy
Taxonomy: Knowledge & Understanding
 

49. What is the purpose of business process reengineering? 


A. To make all business processes best-in-class
B. To make all employees best-in-class
C. To make all business partners best-in-class
D. All of the above

The purpose of BPR is to make all business processes best-in-class.

 


AACSB: Use of Information Technology
Learning Outcome: 2.8
Level: Easy
Taxonomy: Knowledge & Understanding
 

50. Which company used BPR to change its industry by implementing a mobile claims process? 


A. Saab
B. Progressive Insurance
C. Trek
D. Charles Schwab

Progressive Insurance used BPR to change its industry by implementing a mobile claims process.

 


AACSB: Use of Information Technology
Learning Outcome: 2.8
Level: Medium
Taxonomy: Knowledge & Understanding
 

51. What is a business process? 


A. A standardized set of activities that accomplish a specific task, such as processing a customer's order
B. Result in a product or service that is received by an organization's external customer
C. Invisible to the external customer but essential to the effective management of the business and include goal setting, day-to-day planning, performance feedback, rewards, and resource allocation
D. Attempts to understand and measure the current process, and make performance improvements accordingly.

This is the definition of business process.

 


AACSB: Use of Information Technology
Learning Outcome: 2.6
Level: Easy
Taxonomy: Knowledge & Understanding
 

52. What is a customer facing process? 


A. A standardized set of activities that accomplish a specific task, such as processing a customer's order
B. Result in a product or service that is received by an organization's external customer
C. Invisible to the external customer but essential to the effective management of the business and include goal setting, day-to-day planning, performance feedback, rewards, and resource allocation
D. Attempts to understand and measure the current process, and make performance improvements accordingly.

This is the definition of customer facing process.

 


AACSB: Use of Information Technology
Learning Outcome: 2.7
Level: Easy
Taxonomy: Knowledge & Understanding
 

53. What is a business facing process? 


A. A standardized set of activities that accomplish a specific task, such as processing a customer's order
B. Result in a product or service that is received by an organization's external customer
C. Invisible to the external customer but essential to the effective management of the business and include goal setting, day-to-day planning, performance feedback, rewards, and resource allocation
D. Attempts to understand and measure the current process, and make performance improvements accordingly.

This is the definition of business facing process.

 


AACSB: Use of Information Technology
Learning Outcome: 2.7
Level: Easy
Taxonomy: Knowledge & Understanding
 

54. What is the business process improvement model? 


A. A standardized set of activities that accomplish a specific task, such as processing a customer's order
B. Result in a product or service that is received by an organization's external customer
C. Invisible to the external customer but essential to the effective management of the business and include goal setting, day-to-day planning, performance feedback, rewards, and resource allocation
D. Attempts to understand and measure the current process, and make performance improvements accordingly.

This is the definition of business process improvement model.

 


AACSB: Use of Information Technology
Learning Outcome: 2.8
Level: Easy
Taxonomy: Knowledge & Understanding
 

55. Which of the following is a key step involved in the business process improvement model? 


A. Document As-Is process
B. Measure performance
C. Establish measures
D. All of the above

All of these are key steps involved in the business process improvement model.

 


AACSB: Use of Information Technology
Learning Outcome: 2.8
Level: Easy
Taxonomy: Knowledge & Understanding
 

56. Which of the following is a business facing process? 


A. Order processing
B. Sales processing
C. Billing processing
D. Budget forecasting

Budgeting is a business facing process.

 


AACSB: Use of Information Technology
Learning Outcome: 2.7
Level: Easy
Taxonomy: Knowledge & Understanding
 

57. Which of the following is a customer facing process? 


A. Sales planning
B. Order processing
C. Billing processing
D. All of the above

All of the above are customer facing processes.

 


AACSB: Use of Information Technology
Learning Outcome: 2.7
Level: Easy
Taxonomy: Knowledge & Understanding
 

58. What is the analysis and redesign of workflow within and between enterprises? 


A. Customer facing process
B. Business process reengineering
C. Business process improvement
D. Business process management

This is the definition of business process reengineering.

 


AACSB: Use of Information Technology
Learning Outcome: 2.8
Level: Easy
Taxonomy: Knowledge & Understanding
 

59. What attempts to understand and measure the current process, and make performance improvements accordingly? 


A. Customer facing process
B. Business process reengineering
C. Business process improvement
D. Business process management

This is the definition of business process improvement.

 


AACSB: Use of Information Technology
Learning Outcome: 2.8
Level: Easy
Taxonomy: Knowledge & Understanding
 

60. What is the activity of creating a detailed flow chart or process map of a work process showing its inputs, tasks, and activities, in a structured sequence? 


A. Business process modeling
B. Business process model
C. Business process management
D. Business process reengineering

This is the definition of business process modeling.

 


AACSB: Use of Information Technology
Learning Outcome: 2.9
Level: Easy
Taxonomy: Knowledge & Understanding
 

61. What is a graphic description of a process, showing the sequence of process tasks, which is developed for a specific purpose and from a selected viewpoint? 


A. Business process modeling
B. Business process model
C. Business process management
D. Business process reengineering

This is the definition of business process model.

 


AACSB: Use of Information Technology
Learning Outcome: 2.9
Level: Easy
Taxonomy: Knowledge & Understanding
 

62. Business process modeling (or mapping) is the activity of creating a detailed flow chart or process map of a work process showing: 


A. Inputs, tasks, and activities in a structured sequence
B. Resources, tasks, and inputs in a structured sequence
C. Resources, timeframes, and tasks in a structured sequence
D. Inputs, tasks, and costs in a structured sequence

Inputs, tasks, and activities in a structured sequence.

 


AACSB: Use of Information Technology
Learning Outcome: 2.9
Level: Medium
Taxonomy: Knowledge & Understanding
 

63. What integrates all of an organization's business process to make individual processes more efficient? 


A. Business process modeling
B. Business process model
C. Business process management
D. Business process reengineering

This is the definition of BPM.

 


AACSB: Use of Information Technology
Learning Outcome: 2.10
Level: Easy
Taxonomy: Knowledge & Understanding
 

64. Which of the following is not a criteria to determine the importance of a process for reengineering practitioners? 


A. Is the process broken?
B. Is the process antiquated?
C. Does the process rate above best in class?
D. Is the process crucial for productivity improvement?

C should state does the process fall below best in class?

 


AACSB: Use of Information Technology
Learning Outcome: 2.9
Level: Hard
Taxonomy: Knowledge & Understanding
 

 

True / False Questions


 

65. Purchasing stocks is an example of analytical information. 


FALSE

Purchasing stocks is an example of transactional information.

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Easy
Taxonomy: Knowledge & Understanding
 

66. Transactional information is used when performing operational tasks and repetitive decisions such as analyzing daily sales reports and production schedules to determine how much inventory to carry. 


TRUE

Transactional information is used to perform operational tasks.

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Easy
Taxonomy: Knowledge & Understanding
 

67. A business process is the analysis and redesign of workflow within and between enterprises. 


FALSE

This is the definition for business process reengineering, not business process.

 


AACSB: Use of Information Technology
Learning Outcome: 2.9
Level: Medium
Taxonomy: Knowledge & Understanding
 

68. A genetic algorithm is an artificial intelligence system that mimics the evolutionary, survival-of-the-fittest process to generate increasingly better solutions to a problem. 


TRUE

This is the definition of genetic algorithm.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

69. The ultimate goal of AI is the ability to build a system that can mimic human intelligence. 


TRUE

This is the ultimate goal of AI.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

70. Sensitivity analysis, what-if analysis, and market basket analysis are the three quantitative models typically used by a DSS. 


FALSE

Sensitivity analysis, what-if analysis, and goal-seeking analysis are the three quantitative models typically used by a DSS.

 


AACSB: Use of Information Technology
Learning Outcome: 2.3
Level: Medium
Taxonomy: Knowledge & Understanding
 

71. Consolidation, drill-down, and slice-and-dice are the three most common capabilities offered in an EIS. 


TRUE

These are the three most common capabilities offered in an EIS.

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Easy
Taxonomy: Knowledge & Understanding
 

72. A shopping bot is one of the simplest examples of an intelligent agent. 


TRUE

A shopping bot is a simple example of an intelligent agent.

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

73. Business process management integrates all of an organization's business process to make individual processes more efficient. BPM can be used to solve a single glitch or to create one unifying system to consolidate a myriad of processes. 


TRUE

This is the definition of business process management.

 


AACSB: Use of Information Technology
Learning Outcome: 2.10
Level: Easy
Taxonomy: Knowledge & Understanding
 

74. Strategic planning is a customer facing business process. 


FALSE

Strategic planning is a business facing business process.

 


AACSB: Use of Information Technology
Learning Outcome: 2.7
Level: Medium
Taxonomy: Knowledge & Understanding
 

75. Product development is a customer facing business process. 


TRUE

Product development is a customer facing business process.

 


AACSB: Use of Information Technology
Learning Outcome: 2.7
Level: Easy
Taxonomy: Knowledge & Understanding
 

76. Business process reengineering is the analysis and redesign of workflow within and between enterprises. 


TRUE

This is the definition of BPR.

 


AACSB: Use of Information Technology
Learning Outcome: 2.8
Level: Easy
Taxonomy: Knowledge & Understanding
 

 

Fill in the Blank Questions


 

77. ____________ information encompasses all of the information contained within a single business process or unit of work and its primary purpose is to support the performing of daily operational tasks. 


Transactional

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Easy
Taxonomy: Knowledge & Understanding
 

78. ____________ information encompasses all organizational information and its primary purpose is to support the performing of managerial analysis tasks. 


Analytical

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Easy
Taxonomy: Knowledge & Understanding
 

79. Organizations use _______________ information to make repetitive decisions. 


Transactional

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Easy
Taxonomy: Knowledge & Understanding
 

80. Organizations use _________ information to make ad hoc decisions. 


Analytical

 


AACSB: Use of Information Technology
Learning Outcome: 2.1
Level: Easy
Taxonomy: Knowledge & Understanding
 

81. Business process reengineering is the analysis and _________ of workflow within and between enterprises. 


Redesign

 


AACSB: Use of Information Technology
Learning Outcome: 2.9
Level: Medium
Taxonomy: Knowledge & Understanding
 

82. A(n) ___________ is a simplified representation or abstraction of reality. 


Model

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Easy
Taxonomy: Knowledge & Understanding
 

83. A decision support system models __________ to support managers and business professionals during the decision-making process. 


Information

 


AACSB: Use of Information Technology
Learning Outcome: 2.2
Level: Medium
Taxonomy: Knowledge & Understanding
 

84. ___________ analysis occurs when users change the value of one variable repeatedly and observe the resulting changes in other variables. 


Sensitivity

 


AACSB: Use of Information Technology
Learning Outcome: 2.3
Level: Easy
Taxonomy: Knowledge & Understanding
 

85. What-if analysis checks the impact of a __________ in an assumption on the proposed solution. 


Change

 


AACSB: Use of Information Technology
Learning Outcome: 2.3
Level: Medium
Taxonomy: Knowledge & Understanding
 

86. _________ seeking analysis could answer the question "How many customers are required to purchase our new product line to increase gross profits to $5 million?" 


Goal

 


AACSB: Use of Information Technology
Learning Outcome: 2.3
Level: Easy
Taxonomy: Knowledge & Understanding
 

87. __________ logic is a mathematical method of handling imprecise or subjective information. 


Fuzzy

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

88. _____________ systems are various commercial applications of artificial intelligence. 


Intelligent

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

89. Artificial intelligence simulates ______________ intelligence such as the ability to reason and learn. 


Human

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

90. ______________ systems are computerized advisory programs that imitate the reasoning processes of experts in solving difficult problems. 


Expert

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

91. A(n) _________ agent is a special-purpose knowledge-based information system that accomplishes specific tasks on behalf of its users. 


Intelligent

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

92. A(n) _____________ bot is software that will search several retailer websites and provide a comparison of each retailer's offerings including price and availability. 


Shopping

 


AACSB: Use of Information Technology
Learning Outcome: 2.5
Level: Easy
Taxonomy: Knowledge & Understanding
 

93. Business process modeling (or __________) is the activity of creating a detailed flow chart or process map of a work process showing its inputs, tasks, and activities, in a structured sequence. 


Mapping

 


AACSB: Use of Information Technology
Learning Outcome: 2.9
Level: Easy
Taxonomy: Knowledge & Understanding
 

94. A business process model is a graphic description of a __________, showing the sequence of process tasks, which is developed for a specific purpose and from a selected viewpoint. 


Process

 


AACSB: Use of Information Technology
Learning Outcome: 2.9
Level: Easy
Taxonomy: Knowledge & Understanding
 

95. Business process improvement model attempts to understand and _________ the current process, and make performance improvements accordingly. 


Measure

 


AACSB: Use of Information Technology
Learning Outcome: 2.8
Level: Easy
Taxonomy: Knowledge & Understanding
 

96. Business process reengineering is the analysis and redesign of _________ within and between enterprises. 


Workflow

 


AACSB: Use of Information Technology
Learning Outcome: 2.8
Level: Easy
Taxonomy: Knowledge & Understanding
 

97. Customer facing processes result in a product or service that is received by an organization's ___________ customer. 


External

 


AACSB: Use of Information Technology
Learning Outcome: 2.7
Level: Easy
Taxonomy: Knowledge & Understanding
 

98. ________________ facing processes are invisible to the external customer but essential to the effective management of the business and include goal setting, day-to-day planning, performance feedback, rewards, and resource allocation. 


Business

 


AACSB: Use of Information Technology
Learning Outcome: 2.7
Level: Easy
Taxonomy: Knowledge & Understanding
 

99. A business ____________ is a standardized set of activities that accomplish a specific task, such as processing a customer's order. 


Process

 


AACSB: Use of Information Technology
Learning Outcome: 2.6
Level: Easy
Taxonomy: Knowledge & Understanding
 

100. Business processes transform a set of inputs into a set of ___________ for another person or process by using people and tools. 


Outputs

 


AACSB: Use of Information Technology
Learning Outcome: 2.6
Level: Easy
Taxonomy: Knowledge & Understanding
 

101. Manufacturing is a ________ facing process. 


Customer

 


AACSB: Use of Information Technology
Learning Outcome: 2.7
Level: Easy
Taxonomy: Knowledge & Understanding
 

102. Budgeting is a ___________ facing process. 


Business

 


AACSB: Use of Information Technology
Learning Outcome: 2.7
Level: Easy
Taxonomy: Knowledge & Understanding
 

 


Essay Questions
 

103. Identify how an organization can use business process reengineering to improve its business. 

The purpose of BPR is to make all your processes the best-in-class. Companies frequently strive to improve their business processes by performing tasks faster, cheaper, and better. Companies often follow the same indirect path for doing business, not realizing there might be a different, faster, and more direct way of doing business. BPR provides companies with a way to find the different, more direct way of doing business, such as Progressive Insurance.

 


AACSB: Reflective Thinking Skills
Learning Outcome: 2.9
Level: Hard
Taxonomy: Application and Analysis
 

104. List and define the four primary reasons for the growth of decision-making information systems. 

(1) People need to analyze large amounts of information. (2) People must make decisions quickly. (3) People must apply sophisticated analysis techniques, such as modeling and forecasting, to make good decisions. (4) People must protect the corporate asset of organizational information.

 


AACSB: Reflective Thinking Skills
Learning Outcome: 2.2
Level: Hard
Taxonomy: Application and Analysis
 

105. Describe the three capabilities commonly offered by an EIS. 

(1) Consolidation involves the aggregation of information and features simple roll-ups to complex groupings. (2) Drill-down enables users to get details, and details of details. (3) Slice-and-dice looks at information from different perspectives.

 


AACSB: Reflective Thinking Skills
Learning Outcome: 2.2
Level: Hard
Taxonomy: Application and Analysis
 

106. Define the ultimate goal of AI and describe a few current examples of how AI is being used throughout industries. 

At Manchester Airport in England the Hefner ASI Robot Cleaner alerts passengers to security and nonsmoking rules while it scrubs up to 65,600 square feet of floor per day. A SmartPump keeps drivers in their cars on cold, wet days. The SmartPump can service any automobile built after 1987 that has been fitted with a special gas cap and a windshield-mounted transponder that tells the robot where to insert the pump. The Miami Police Bomb squad's AI robot that is used to locate and deactivate bombs. Matsushita's courier robot navigates hospital hallways, delivering patient files, X-ray films, and medical supplies. FireFighter AI Robots can extinguish flames at chemical plants and nuclear reactors with water, foam, powder, or inert gas.

 


AACSB: Reflective Thinking Skills
Learning Outcome: 2.5
Level: Hard
Taxonomy: Application and Analysis
 

107. List and define the four most common categories of AI. 

(1) Expert systems are computerized advisory programs that imitate the reasoning processes of experts in solving difficult problems. (2) Neural Networks attempt to emulate the way the human brain works. (3) Genetic algorithm - system that mimics the evolutionary, survival-of-the-fittest process to generate increasingly better solutions to a problem. (4) Intelligent agents are special-purposed knowledge-based information system that accomplishes specific tasks on behalf of its users.

 


AACSB: Reflective Thinking Skills
Learning Outcome: 2.5
Level: Hard
Taxonomy: Application and Analysis
 

108. Describe business processes and their importance to an organization. 

A business process is a standardized set of activities that accomplish a specific task, such as processing a customer's order. Business processes transform a set of inputs into a set of outputs (goods or services) for another person or process by using people and tools. Without processes organizations would not be able to complete activities.

 


AACSB: Reflective Thinking Skills
Learning Outcome: 2.6
Level: Hard
Taxonomy: Application and Analysis
 

109. Differentiate between customer facing processes and business facing processes. 

Customer facing processes result in a product or service that is received by an organization's external customer. Business facing processes are invisible to the external customer but essential to the effective management of the business and include goal setting, day-to-day planning, performance feedback, rewards, and resource allocation.

 


AACSB: Reflective Thinking Skills
Learning Outcome: 2.7
Level: Hard
Taxonomy: Application and Analysis
 

110. Compare the business process improvement model and business process reengineering. 

Many organizations began business process improvement with a business improvement model. A business process improvement model attempts to understand and measure the current process, and make performance improvements accordingly. Business process reengineering (BPR) is the analysis and redesign of workflow within and between enterprises. BPR relies on a different school of thought than business process improvement. In the extreme, BPR assumes the current process is irrelevant, does not work, or is broken and must be overhauled from scratch. Such a clean slate enables business process designers to disassociate themselves from today's process and focus on a new process. It is like the designers projecting themselves into the future and asking: What should the process look like? What do customers want it to look like? What do other employees want it to look like? How do best-in-class companies do it? How can new technology facilitate the process?

 


AACSB: Reflective Thinking Skills
Learning Outcome: 2.8
Level: Hard
Taxonomy: Application and Analysis
 

111. Describe the importance of business process modeling (or mapping) and business process models. 

Business process modeling (or mapping) is the activity of creating a detailed flow chart or process map of a work process showing its inputs, tasks, and activities, in a structured sequence. A business process model is a graphic description of a process, showing the sequence of process tasks, which is developed for a specific purpose and from a selected viewpoint. A set of one or more process models details the many functions of a system or subject area with graphics and text and its purpose is to: expose process detail gradually and in a controlled manner; encourage conciseness and accuracy in describing the process model; focus attention on the process model interfaces; provide a powerful process analysis and consistent design vocabulary.

 


AACSB: Reflective Thinking Skills
Learning Outcome: 2.9
Level: Hard
Taxonomy: Application and Analysis
 

112. Explain business process management along with the reason for its importance to an organization. 

The latest area to discover the power of technology in automating and reengineering business process is business process management. Business process management (BPM) integrates all of an organization's business process to make individual processes more efficient. BPM can be used to solve a single glitch or to create one unifying system to consolidate a myriad of processes. Many organizations are unhappy with their current mix of software applications and dealing with business processes that are subject to constant change. These organizations are turning to BPM systems that can flexibly automate their processes and glue their enterprise applications together.

 


AACSB: Reflective Thinking Skills
Learning Outcome: 2.10
Level: Hard
Taxonomy: Application and Analysis
 


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