OMIS 351 - Midterm Exam Study Guide
OMIS 351 Midterm Study Review
OMIS 351 Study Review
Chap 1
➔ Why Study IS?
Business models and strategies have rapidly changed based on new and evolving technology
➔ Hype Cycle
◆ Understand and describe parts of hype cycle
The hype cycle is described as a curve with market expectations (vertical axis) plotted against time (horizontal axis) that stakes out five stages]
1. Emerging innovation
2. Inflated expectations
3. Trough of disillusionment
4. Slope of enlightenment
5. Plateau of productivity
◆ Apply to real world scenarios
A real world scenario would be when the internet first became a thing. It was seen as an emerging innovation, and had inflated expectations. Eventually there was a trough of disillusionment where the internet slowed down and we were limited to what the softwares were capable of. Over time the slope of enlightenment hit when there were more people who were able to start programming software themselves and the individual creativity rose. We are now in a plateau of productivity as we still try to slowly innovate in other areas using the internet
◆ Impact of AI (High level)
AI is capable of changing the future
Chap 3 (Understand and apply to examples)
➔ Fast follower problem
Fast follower problem exists when competitors
· Watch a pioneer’s effort
· Learn from their successes and missteps
· Enter the market quickly with a comparable or superior product at a lower cost before the first mover can dominate
➔ Four critical characteristics -resource-based view of competitive advantage
Resourcve-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 4 critical characteristics
1. Valuable
2. Rare
3. Imperfectibly imitable
4. Nonsubstitutable
➔ Five primary components of the value chain
Value chain – set of activities through which a product or service is created and delivered to customers
Imitation-resistant value chain – a way of doing business that competitors struggle to replicate and that involves technology in a key enabling role
Five Primary components:
1. Inbound logistics
2. Operations
3. Outbound logistics
4. Marketing and sales
5. Support
Secondary Components
1. Firm’s infrastructure
2. Human resources management
3. Technology/research and development
4. Procurement
➔ Porter’s 5 forces of competitive analysis
4 of the 5 forces directly and inversely affect the 5th force
1. Potential new entrants
2. Threat of substitute products or services
3. Power of suppliers
4. Power of buyers’
These 4 forces affect “Rivalry among existing competitors”
Chap 7
➔ Why do big firms fail?
➔ Failure to see disruptive innovations as threats
➔ Early customers for a disruptive technology care about different features and attributes that incumbent customers
➔ Over time, disruptive technology becomes good enough to appeal to customers of incumbent products and invade these markets
➔ Characteristics of Giant Killers?
I am not sure if Giant Killers and disruptive technologies is the same thing, but I can’t find anything about giant killers so
True disruptive technologies are technologies that create market shocks and catalyze growth
They have 2 particular characteristics
· Come to market with set of performance attributes existing customers don’t value
· Over time, performance attributes improve to the point where they invade established markets
➔ How are large firms combating challenges?
· Build a portfolio of options on emerging technologies, investing in firms, startups, or internal efforts that focus solely on what may or may not turn out to be the next big thing
· Options give the firm the right to continue and increase funding as a technology shows promise
· Having innovation separated from core businesses to encourage new market and technology development
➔ McNamara fallacy
McNamara Fallacy – basing decisions based on past data and examples – is especially risky when dealing with disruptive innovation
Happens in 4 steps
1. Measure what can be easily measured: focusing on umbers that are readily available
2. Disregard what can’t be easily measured: Ignoring important aspects that are harder to quantify
3. Assume what can’t be easily measured is not important: Devaluing qualitative elements
4. Assume what can’t be measured doesn’t exist: completely dismissing factors that are difficult to quantify
Atoms to bits – physical world to digital world
➔ Apply concepts to how Amazon and Netflix grew and continue to grow(Chap 5 & 8)
Chap 10
➔ Impact and characteristics of network effects
Network effects: when the value of a product or service increase as its number of users expands
The first source of network effects is exchange
· A network becomes more valuable because its users can potentially communicate with more people
The second source of network effects is staying power
· Networks with greater number of users suggest a stronger staying power: Long-term viability of a product or a service
· Switching costs: incurred when moving from one product to another
· Total cost of ownership (TCO): economic measure of the full cost of owning a product
The third source of network effects is complementary benefits
· Complementary benefits: products or services that add additional value to the primary product or service that makes up a network
➔ One sided vs two sided markets
One sided market: Market that derives most of its value from a single class of users
· Same side exchange benefits: benefits derived by interaction among members of a single class of participant
· Example of this kind of networking is messaging
Two- sided market: network markets comprised of two distinct categories of participants, both of which are needed to deliver value for the network to function
· Cross side exchange benefit: an increase in the number of users on one side of the market, creating a rise in the other side
· An example of this kind of network is video games
➔ Recognize when network effects are present
When network effects are present, more users attract more users—but too many users and a service can be so overwhelmed that it becomes unusable
Results in Congestion effects: when increasing numbers of users lower the value of a product or service
Chap 11
- Understand and identify Owned, Paid, and Earned Media, and Inbound Marketing
Owned Media: communication channels that an organization controls. These can include firm-run blogs and websites, any firm-distributed corporate mobile website or app, and organization accounts on social media such as twitter, Facebook, Pinterest, YouTube, and Instagram
Paid Media: refers to efforts where an organization pays to leverage a channel or promote a message. Paid media efforts include things such as advertisement and sponsorships
Earned media: promotions that are not paid for or owned but rather grow organically from customer efforts or other favorable publicity. Social media can be a key driver of earned media (Positive tweets, likes, shares etc)
Inbound Marketing: refers to leveraging online channels to draw consumers to the firm with compelling content rather than conventional forms of promotion such as advertising, e-mail marketing, traditional mailings, and sales calls
- Impact of Social media in business
· Enhanced Brand visibility
· Direct Customer Engagement
· Cost-Effective Marketing
· Data-Driven Insights
· Influencer Marketing
· User-Generated Content (UGC)
· Global Reach and Accessibility
· Rapid Product Feedback and market research
· Sales and lead generation
· Crisis management and reputation building
- Crowdsourcing
Crowdsourcing – the act of taking a job traditionally performed by a designated agent and outsourcing it to an undefined, generally large group of people in the form of an open call
- Understand why companies are building Social media team
Social media—savvy organizations use X as a business tool and have found the site useful for promotions and information related to customers and engagement
Chap 12
- Understand what a sharing economy is
A sharing economy is a section of the economy that depends on the users to provide goods or services
Goods: includes selling sights like eBay, craigslist, Etsy, CustomMade, or loaner sights like Boat setter, rent the runway
Services includes delivery services like door dash, Grubhub, Instacart, Postmates, or professional services like Upwork, crowdSPRING
- Understand risk and reward in a sharing economy to:
o Suppliers
Benefits: Flexibility, income, low barrier to entry
Risks: Job security, income not steady, liability/upkeep, local laws
o Companies
Benefits: scalability, cost efficiency, global reach, flexibility
Risks: regulatory challenges, reputation management, worker retention, data security
o Customer
Benefits: Convenience, variety, lower costs
Risks: safety, data privacy, inconsistent quality
o Investors
Benefits: high upside, low capital, disruptive
Risks: market saturation, regulatory issues, dependence on trust
- What helped drive the sharing economy?
Cloud computing – includes on-demand scaling, Global operations/reach, data management for millions of users, on-demand cost – pay as you go
ML and analytics: dynamic pricing, personal experience, cashless, real time information
Chap 13
- What is a social graph?
Social graph – represents the relationships between people (and entities) in a network. It is a foundational concept in social media, business, and data analytics
Social graphs help businesses understand how information flows. They reveal customer networks, employee connections, and organizational influence
- How does it differ from interest graph?
Interest graphs - focuses on mapping connections based on shared interests or behaviors, regardless of personal relationships
- Key features of a social graph?
Nodes - represent individuals or entities in a network
Edges - are the lines between nodes that represent relationships, such as friendships or transactions
Degree – the number of connections (edges) it has to other nodes
Centrality – importance or influence of a node within a network
Clustering – grouping of closely connected nodes
Density – how interconnected graph is by comparing the number of actual connections to the total number of possible connections
IT overview
- Shadow IT
Shadow IT is when an organization has a set of people taking care of the IT without knowledge or without being in the IT department
· It is decentralized and has no IT oversight
· It is hard to support and leads to insecure networks, but it is flexible and can change quickly
- Identify differences in approach between IT and other business functions
1. IT as a strategic partner, not just a support function
2. IT drives innovation and digital transformation
3. Data driven decision making
4. IT and Business alignment is essential for success
5. IT’s role in managing risks and compliance
- Match key functions of IT with the function they perform
IT infrastructure – the backbone of business operations
Data management and integration – Managing and storing data across systems
Cyber security and risk management – protecting ystems and data from cyber threats
Software development and maintenance – building and maintaining custom systems
Networking and connectivity – ensuring seamless communication and data transfer
User support and helpdesk - providing technical support to employees
IT Governance and compliance – ensuring IT aligns with business goals
Protecting management and IT alignment – Managing IT projects while aligning with business complexities
Vendor and 3rd party management – working with external providers
Speed of trust
- 4 areas of trust and why they are important
1. Integrity – acting with honesty and congruence
2. Intent – aligning motives and behavior
3. Capabilities – having the skills and knowledge
4. Results – achieving outcomes and keeping promises
- 5 topics built on pyramid (5 dysfunctions of a team) impact of doing well and not doing well
From the bottom of the pyramid to the top
Lack of trust
Fear of conflict
Lack of commitment
Avoidance of accountability
Lack of results
- Impact on IT and Business
· Trust is the foundation of effective IT-business relationships
· Perception of IT needs to change
· Trust can accelerate everything
· Technology alone doesn’t create trust
· Trust can be a key differentiator in the digital age