301 Textbook Vocabulary

Chapter 1 Type of IS

• Artificial Intelligence (AI): A broad field encompassing the development of computer systems that can perform tasks that typically require human intelligence, such as learning, problem-solving, and decision-making.

• Cloud Computing: The delivery of computing services—including servers, storage, databases, networking, software, analytics, and intelligence—over the Internet ("the cloud").

• Digital Transformation: The process of using digital technologies to create new—or modify existing—business processes, culture, and customer experiences to meet changing business and market requirements.

• GenAI (Generative AI): A type of artificial intelligence that focuses on creating new, original content, such as text, images, audio, or code, often based on patterns learned from existing data.

• Market Capitalization (Market Cap): The total value of a publicly traded company's outstanding shares of stock. It is calculated by multiplying the number of shares outstanding by the current market price per share.

• Microprocessor: The central processing unit (CPU) on a single integrated circuit, responsible for executing the instructions of a computer program.

• Open Source Software: Software with source code that is made freely available for use, distribution, and modification.

• Pivoting: In a business context, a significant shift in a company's strategy, business model, or product offering, often based on feedback or changing market conditions.

• R&D (Research and Development): Activities undertaken by companies to innovate and introduce new products, services, or technological advancements.

• SaaS (Software as a Service): A software distribution model in which a third-party provider hosts applications and makes them available to customers over the Internet.

• Server Farm: A large group of networked computer servers housed in a single physical space, typically used by organizations for the remote storage, processing, or distribution of large amounts of data.

• Term Sheet: A non-binding agreement that outlines the basic terms and conditions under which an investment will be made. In the context of startups, it often precedes a more detailed legal agreement with investors.

Chapter 2 ZARA

• Competitive Advantage: A set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition.

• Product-Market Fit: The degree to which a product satisfies strong market demand. Successful efforts should be desired by customers and scale into large, profitable businesses.

• Switching Cost: The cost a consumer incurs when moving from one product or service to another. These costs can be monetary, time-related, or psychological.

• Data Asset: Accumulated data that a firm can leverage to gain insights, improve operations, and create competitive advantages (e.g., product recommendations, customer profiling).

• Brand: The symbolic embodiment of all the information connected with a product or service. A superior customer experience strengthens the brand.

• Machine Learning: A type of artificial intelligence that enables computer systems to learn from data without being explicitly programmed.

• Customer Profiling: The process of creating a detailed description of a company's typical customer, often based on data analysis.

• Inventory Turns: The number of times a company's inventory is sold and replaced over a period. A higher number generally indicates efficient inventory management.

• Vertical Integration: When a single firm owns several layers in its value chain.

• Contract Manufacturing: Outsourcing production to third-party firms that do not own the plants or directly employ the workers producing the goods.

• Information System (IS): An integrated solution that combines hardware, software, data, procedures, and the people who interact with and are impacted by the system.

• Return on Investment (ROI): The amount earned from an expenditure. Financial considerations should forecast ROI before deploying new systems.

• Omnichannel: An approach to retail that offers consumers an integrated and complementary set of shop, sales, and return experiences across online and offline channels.

• Straddling: Attempts to occupy more than one position, while failing to match the benefits of a more efficient, singularly focused rival.

• Operations: Organizational activities that are required to produce goods or services.

Chapter 3 IT & Strategy

• Affiliates: Third parties that promote a product or service, typically in exchange for a cut of any sales.

• APIs (Application Programming Interfaces): Programming hooks, or guidelines, published by firms that tell other programs how to get a service to perform a task such as send or receive data.

• Augmented Reality: A technology that superimposes content, such as images and animation, on top of real-world images.

• Brand: The symbolic embodiment of all the information connected with a product or service.

• Bundling: Selling products available separately as a single package.

• Commodity: A basic good that can be interchanged with nearly identical offerings by others.

• Dense Wave Division Multiplexing (DWDM): A technology that increases the transmission capacity (and hence speed) of fiber-optic cable by splitting light into different wavelengths.

• Distribution Channel: The path through which products or services get to customers.

• Economies of Scale: When costs can be spread across increasing units of production or in serving multiple customers.

• Fast Follower Problem: Exists when savvy rivals watch a pioneer’s efforts, learn from their successes and missteps, then enter the market quickly with a comparable or superior product at a lower cost before the first mover can dominate.

• Imitation-Resistant Value Chain: A way of doing business that competitors struggle to replicate and that frequently involves technology in a key enabling role.

• Network Effects: Also known as Metcalfe’s Law, or network externalities. When the value of a product or service increases as its number of users expands.

• Non-Practicing Entities: Commonly known as patent trolls, these firms make money by acquiring and asserting patents, rather than bringing products and services to market.

• Operational Effectiveness: Performing the same tasks better than rivals perform them.

• Porter's Five Forces: Also known as Industry and Competitive Analysis. A framework considering the interplay between (1) the intensity of rivalry among existing competitors, (2) the threat of new entrants, (3) the threat of substitute goods or services, (4) the bargaining power of buyers, and (5) the bargaining power of suppliers.

• Private (to go private): Buying up a publicly traded firm’s shares.

• Resource-Based View of Competitive Advantage: The strategic thinking approach suggesting that if a firm is to maintain sustainable competitive advantage, it must control an exploitable resource, or set of resources, that have four critical characteristics: valuable, rare, imperfectly imitable, and non substitutable.

• Scale Advantages: Advantages related to size.

• Strategic Positioning: Performing different tasks than rivals, or the same tasks in a different way.

• Straddling: In strategic management, this refers to a firm's attempt to occupy more than one position, while failing to match the benefits of a more efficient, singularly focused rival.

• Sustainable Competitive Advantage: Financial performance that consistently outperforms industry averages.

• Switching Cost: The cost a consumer incurs when moving from one product to another.

• Value Chain: The set of activities through which a product or service is created and delivered to customers.

• Viral Marketing: Leveraging consumers to promote a product or service.

Chapter 4 Fresh Direct

• Product-Market Fit: The degree to which a product satisfies existing market demand. A successful product-market fit means the product is desired by customers and can scale into a profitable business.

• Collaborative Filtering: A type of software that analyzes user behavior and preferences within a group to make personalized recommendations to individual users.

• Switching Cost: The inconvenience or expense a customer incurs when changing from one product or service to another. This can include financial costs, time investment, or loss of data.

• Data Asset: A collection of data that a company possesses and can leverage for competitive advantage. This data is often unique to the firm and difficult for competitors to replicate.

• Brand: The overall perception and image associated with a product or service in the minds of consumers. It represents the symbolic embodiment of all information connected to that offering.

• Inventory Turns: The number of times a company sells and replenishes its inventory over a specific period. A higher inventory turn rate indicates efficient sales and less time that products are held in stock.

• Straddling: A situation where a company attempts to pursue more than one distinct business model simultaneously, often resulting in a failure to achieve optimal efficiency or distinctiveness in either model compared to more focused competitors.

Chapter 5 Netflix

• Atoms to Bits: The shift from physical products (atoms) to digital products (bits) in various media industries.

• Long Tail: An extremely large selection of content or products, where a firm can make profits by offering a near-limitless choice.

• First Sale Doctrine: A U.S. legal principle allowing the owner of a legally purchased copyrighted work to sell, display, or dispose of that particular copy.

• Windowing: Releasing content to different distribution channels (theaters, DVD, streaming, etc.) at different times, usually with different pricing models.

• Fixed Costs: Costs that remain constant regardless of the volume of production or services offered.

• Marginal Costs: The additional cost incurred by producing one more unit of a good or service.

• Coopetition: A situation where firms both cooperate and compete with each other.

• Transfer Pricing: The price at which divisions of the same company transact with each other.

• Decision Fatigue: The mental depletion experienced when faced with an overwhelming number of choices, leading to poorer decision-making or avoidance.

• Congestion Effect: A phenomenon where the value of a product or service decreases as the number of users increases (in this context, referring to the overwhelming amount of content competing for user attention).