Chapter 10: Enterprise Systems Test Bank Multiple Choice 1. Organizations continue to run older business systems, called ________ because they form the core of mission-critical computing systems. a. b. c. d.
Reduced-function IT Last gen software Legacy systems Bloat-ware
Answer: C Difficulty: Medium Section Ref: Chapter Snapshot Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Technology
2. Enterprise systems are integrated ISs that support core business processes and functions. How is integration achieved? a. Integration is achieved by connecting wired and wireless computer networks so they can share applications. b. Integration is achieved by outsourcing to vendors that replace stand-alone ISs with a single IS. c. Integration is achieved by connections to central data repositories that enable them to synch and share the latest data. d. Integration is achieved by using cloud computing. Answer: C Difficulty: Hard Section Ref: Chapter Snapshot Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Technology
3. When companies need to update mission critical computing systems, they often turn to ________ which integrate core business process and functions. a. Legacy systems
b. Enterprise systems c. Network solutions d. Custom built software apps Answer: B Difficulty: Medium Section Ref: Chapter Snapshot Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Reflective thinking skills
4. According to IT research firm Gartner, ________ is [are] a strategic technology trend that is likely to cause an explosion in demand for the technology. a. b. c. d.
Legacy systems Enterprise systems 2D interfaces 3D printing
Answer: D Difficulty: Medium Section Ref: Opening Case 10.1 Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Reflective thinking skills
5. 3D printing, which is also called ________, has produced spare parts, toys, jewelry, and food. a. b. c. d.
additive manufacturing bioprinting multi-dimensional bar coding R&D production
Answer: A Difficulty: Medium Section Ref: Opening Case 10.1 Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Technology
6. Examples of the potential of 3D printing include all of the following except ________. a. Printing replacement parts on-demand at hardware stores. 2
b. Printing parts for maintenance and repair as needed at defense supply posts or in combat areas. c. Printing low-cost replacement parts in mass quantities for backup inventory at car repair centers. d. 3D-printing expensive replacement parts for MRI scanners onsite at healthcare facilities. Answer: C Difficulty: Medium Section Ref: Opening Case 10.1 Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Technology
7. The greatest challenges when implementing enterprise systems are due to _____. a. b. c. d.
interfacing legacy systems vendors change management end-users
Answer: A Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Reflective thinking skills
8. Enterprise resource planning help managers and companies improve their performance by enabling them to __________. a. b. c. d.
Distribute data and periodic reports via e-mail internally to authorized users Integrate internal business processes and link to external business partners Consolidate data stores into a central data repository. Outsource business processes to SaaS vendors and eliminate waste.
Answer: B Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
9. Which of the following does not describe enterprise systems? 3
a. Enterprise systems require data transfers to mobile and smart devices. b. Implementing an enterprise system typically requires the help of a consulting firm, vendor, or value-added reseller [VAR]. c. Integrating legacy systems with cloud-based applications is complex mostly because of the complexity of getting new apps to interface with existing or legacy systems. d. An advantage of enterprise systems is that processes can be automated for consistency and efficiency. Answer: A Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
10. __________ systems are commercial software packages that integrate business processes, including supply chains, manufacturing, financial, human resources, budgeting, sales, and customer service. a. b. c. d.
CRM ERP KM SCM
Answer: B Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
11. All of the following are reasons why companies might need to migrate from legacy systems to enterprise systems except ________. a. Legacy systems have high maintenance costs. b. Legacy architectures are inflexible. c. Legacy systems are hardwired by predefined process flows making integration with Internet-based apps difficult or impossible. d. Legacy systems require retraining of end users. Answer: D Difficulty: Easy 4
Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
12. Implementing an enterprise system is challenging because it requires extensive organizational changes. Which of the following is not one of the required changes? a. b. c. d.
Redesign of business processes Hiring many IT staff skilled in the latest technologies Changes in how people perform their jobs Integration of various information systems
Answer: B Difficulty: Hard Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
13. ________ refers to private or company-owned social media, software, platforms, or apps specially designed for use by business leaders and employees to fulfill the strategic mission. a. b. c. d.
Enterprise social Social markets Knowledge management Collaboration tools
Answer: A Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
14. ________ is a social network geared toward enterprises and used by employees to collaborate across departments, locations, and business apps. a. b. c. d.
Microsoft Cloud Oracle SharePoint Yammer
5
Answer: D Difficulty: Easy Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology 15. ________ is ―Facebook for business.‖ a. b. c. d.
Microsoft Cloud Office Graph SharePoint Yammer
Answer: D Difficulty: Easy Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
16. ________ provides a hybrid infrastructure and capabilities to manage enterprise apps and data. a. b. c. d.
Microsoft Cloud Office Graph SharePoint Yammer
Answer: A Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
17. ________ is a collaborative and social platform from Microsoft that is used by an estimated 78 percent of Fortune 500 firms. a. b. c. d.
Microsoft Cloud Office Graph SharePoint Yammer
6
Answer: C Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
18. SharePoint can be used to set up a secure, access-controlled ________ site to share with external partners in the supply chain, contractors, and so on. a. b. c. d.
extranet intranet cloud legacy
Answer: A Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
19. ________ uses signals from e-mail, social conversations, documents, sites, instant messages, meetings, and more to map the relationships between people and concepts. a. b. c. d.
Microsoft Cloud Office Graph Oracle Jive
Answer: B Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
20. All of the following are enterprise social networks or platforms except ________. a. b. c. d.
Chatter Jive Oracle Social Network Salesforce 7
Answer: D Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
21. The latest ERP solutions are designed with a focus on __________. a. b. c. d.
client–server architectures and custom-designed apps Web-based architecture and VPNs social collaboration and accessibility from mobile devices manufacturing, distribution, retail, and service
Answer: C Difficulty: Hard Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
22. Each of the following describes ERP systems except _________. a. ERP apps interface with business partners through a B2B gateway, but cannot interface with legacy apps. b. From a technology perspective, ERP is the software infrastructure that links an enterprise’s internal apps. c. ERP is now a mature technology, whose core components have not changed much. d. ERPs help departments stay informed of what’s going on in other departments that impact its operations or performance. Answer: A Difficulty: Hard Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
23. The _________ layer, or middleware, enables the ERP to interface with legacy apps. a. Client-server 8
b. Data center integration c. enterprise application integration d. Web browser Answer: C Difficulty: Hard Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
24. Typically, how are ERP systems acquired? a. b. c. d.
By purchasing or leasing in a SaaS arrangement By building in-house By building with proprietary software From consulting companies
Answer: A Difficulty: Easy Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
25. Which of the following descriptions about ERP failures is not true? a. Several of the best companies have suffered devastating consequences from ERP failures that had led to multi-million dollar losses, bankruptcy, or lawsuits. b. Most often, ERP failures are eventually fixed and remain in use, which gives the false impression that the ERP was successful from the start. c. The success—as well as failure—of ERP depends on organizational and technological factors that occur prior to, during, and after the implementation. d. Vendor blogs, white papers, and YouTube posts are good sources of objective data for selecting an ERP solution. Answer: D Difficulty: Medium Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
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26. Despite potential benefits, not all companies invest in ERP if they cannot meet requirements or overcome the challenges. Which of the following is not one of those requirements or challenges? a. Obtain strong and continuing support from senior executives. b. The total cost of ownership of an ERP equals the cost of the ERP and the monthly SaaS fees. c. Focus on business processes and requirements, rather than on technical capabilities. d. Provide thorough training and change management. Answer: B Difficulty: Hard Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
27. Many managers assume that success or failure depends on the software. In reality, ________ percent of a project's success or failure lies in the hands of the company implementing the software, not the software vendor. a. b. c. d.
20 33 50 95
Answer: D Difficulty: Medium Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
28. ERP success depends on several key factors being met. These factors include all of the following except _________. a. b. c. d.
Minimize change for workers. Focus on business processes and requirements. Focus on achieving a measurable ROI Use a strong project management approach
Answer: A Difficulty: Medium 10
Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
29. ________ starts with the acquisition of raw materials or products and proceeds through the disposal or ________of products. a. b. c. d.
Procurement; recycling Production; sale Supply chain; recycling Supply cycle; dumping
Answer: C Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Reflective thinking skills
30. Consumer product and retail industries lose about $40 billion annually, or 3.5 percent of their sales, due to __________. a. b. c. d.
Fraud Compliance failures Supply chain inefficiencies Quality control failures
Answer: C Difficulty: Hard Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
31. ________ are activities such as sales and advertising that are visible to customers. a. b. c. d.
Back-office operations Front-office operations Order fulfillment EFT
Answer: B 11
Difficulty: Easy Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
32. ________ are activities that support the fulfillment of orders. a. b. c. d.
Back-office operations Front-office operations Order fulfillment EFT
Answer: B Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
33. ________ is the set of complex processes involved in providing customers with what they have ordered on time and all related customer services. a. b. c. d.
Back-office operations Front-office operations Order fulfillment EFT
Answer: C Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
34. The 2016 MHI Annual Industry Report cited all of the following key technologies impacting the supply chain except _________. a. b. c. d.
Robotics and automation Enterprise Resource Planning Sensors and automatic identification Predictive Analytics
12
Answer: B Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
35. Supply chains involve three main flows. Which of the following is not one of those main flows? a. b. c. d.
Payments or financial Resource Information Material
Answer: B Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
36. Products that are returned make up what is called the __________. a. b. c. d.
Reverse supply chain Return logistics Backflow Reorder fulfillment
Answer: A Difficulty: Easy Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
37. Accounting, inventory management, and shipping are part of order fulfillment and referred to as __________ operations. a. b. c. d.
Back-office Customer-facing Front-office Logistics 13
Answer: A Difficulty: Easy Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
38. Efficient, effective supply chains are fully dependent on SCM software, which depends on __________. a. b. c. d.
SaaS ERP up-to-date and accurate data RFID
Answer: C Difficulty: Hard Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Reflective thinking
39. Attracting and acquiring new customers is estimated to costs banks roughly __________ per new customer. a. b. c. d.
$10 $25 $50 $100
Answer: D Difficulty: Easy Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
40. Retaining customers that generate revenues in excess of the costs of customer service, returns, promotional items, and the like are critical; and are the underlying reason for __________. a. EDI 14
b. ERP c. CRM d. SCM Answer: C Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
41. What is the purpose of frequent purchase programs offered by airlines, supermarkets, credit card issuers, retailers, casinos, and other companies? a. b. c. d.
To track customers for CRM purposes To build customer loyalty to improve financial performance To deter customer attrition All are purposes
Answer: D Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Reflective thinking
42. According to the loyalty effect, a 5% reduction in customer attrition can improve profits by as much as __________ percent. a. b. c. d.
5 10 20 30
Answer: C Difficulty: Easy Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
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43. Apple’s iPhone and iPod are best examples of __________ business strategies because demand was so high that many customers were even willing to camp out on sidewalks to guarantee getting one on the day of their releases. a. b. c. d.
customer-centric product-centric upselling cross-selling
Answer: A Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Reflective thinking
44. There have been many CRM failures reported in the media. Major issues relating to CRM failures include each of the following except _________. a. b. c. d.
customers rejecting loyalty programs or attempts to build loyalty. underestimating users’ resistance to change. making mobile CRM strategy an afterthought. putting the IT department in charge of the CRM project instead of business users.
Answer: A Difficulty: Hard Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Reflective thinking
45. A formal business plan must be in place before the CRM project begins. The business plan should include an assessment of each of the following factors except ________. a. b. c. d.
clear and precise cost–benefit analysis and tangible benefits expected intangible benefits clear understanding of how to put an existing CRM on mobile devices risk assessment of all of potential pitfalls related to people, processes, and technology
Answer: C Difficulty: Medium Section Ref: 10.5 Customer Relationship Management
16
Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
46. The medical application of 3D printing to produce living tissue and organs is called 3D ______________. a. b. c. d.
engineering reengineering bioprinting bionics
Answer: C Difficulty: Medium Section Ref: Opening Case 10.1 Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Reflective thinking skills
47. The step in the supply chain that is triggered by an out-of-stock situation is ______________. a. b. c. d.
purchase returns replenishment shipment
Answer: C Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Reflective thinking skills
48. As a technology that could dramatically impact the supply chain, drones could deliver significant value by all of the following except ______________. a. b. c. d.
making deliveries to customers in parking lots and their homes monitoring functioning of plants provide data about a facility’s surroundings more ―human‖ tasks such as picking and packaging items
Answer: D Difficulty: Medium 17
Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
49. Using smart glasses in a warehouse environment to assist in filling orders is known as: a. b. c. d.
additive manufacturing vision-picking ocular sensing robotics
Answer: B Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
50. In a recent survey by Forester research, business professionals thought that business performance improvement actually depends on a combination of four factors: the right people, processes, ______________ and technology. a. b. c. d.
funding strategy knowledge data
Answer: B Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Reflective thinking
18
True/False 51. Companies use IT systems to manage their supply chain, which starts with the acquisition of raw materials or the procurement of products and proceeds through manufacture, transport, and delivery—and the disposal or recycling of products. Answer: True Difficulty: Easy Section Ref: Opening Case 10.1 Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Technology
52. According to global investment management firm Goldman Sachs, 3D printing is one of the technologies that are going to creatively destroy, to some extent, traditional manufacturing. Answer: True Difficulty: Easy Section Ref: Opening Case 10.1 Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Technology
53. 3D printing, also known as additive manufacturing, is a process whereby materials are cut, ground, or molded to create an object. Answer: False Difficulty: Easy Section Ref: Opening Case 10.1 Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Technology
54. Enterprise systems refer to a category of information systems that link the enterprise with suppliers, business partners, and customers. Answer: True Difficulty: Easy Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Technology
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55. SCM systems are commercial software packages that integrate business processes, including supply chains, manufacturing, financial, human resources, budgeting, sales, and customer service. Answer: False Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
56. CRM is a business strategy to segment and manage customers to optimize customer lifetime value [CLV]. Answer: True Difficulty: Easy Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
57. Implementing an enterprise system is relatively simple, but sometimes may require the help of a consulting firm, vendor, or value-added reseller [VAR]. Answer: False Difficulty: Easy Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
58. A major challenge of enterprise systems is getting new apps or system modules to interface with existing or legacy systems that are several generations older. Answer: True Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
59. Enterprise systems require data transfers—often to mainframes. 20
Answer: True Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
60. Many times seemingly well-planned projects fail and require extensive reworking because integration issues had not been properly planned. Answer: True Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
61. Some enterprises choose to avoid the challenges of integration enterprise systems by creating a new system that replaces the full functionality of the old one. This option is the lowest cost and least risky. Answer: False Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
62. Companies tend to migrate to an enterprise solution when they need to consolidate their disparate systems, such as when limitations caused by their existing legacy systems interfere with performance or the ability to compete Answer: True Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
63. Legacy architectures were designed for flexibility, but not for the cloud.
21
Answer: False Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
64. A best practice prior to the design and implementation of an enterprise system is to redesign processes so they can be automated to some extent. Answer: True Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
65. Enterprise systems require retraining users whose productivity initially will increase significantly as they adjust to a new way of doing their jobs. Answer: False Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
66. Automated data flows are essential to productivity improvements. Answer: True Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
67. Common ways to overcome the complexity of enterprise system implementation are to lease or license from vendors. Answer: True Difficulty: Easy Section Ref: 10.1 Enterprise Systems 22
Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
68. Enterprise social technology had made it easier for employees to connect and collaborate with others, stay informed, build relationships, and share documents and data Answer: True Difficulty: Easy Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
69. The trend is toward more formal communication methods in organizations, such as with Yammer. Answer: False Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
70. Yammer is the social collaboration tool of choice for SharePoint. Answer: True Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
71. SharePoint is difficult to define precisely because it is not a single software program, but rather a platform for multiple kinds of programs and apps. Answer: True Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology 23
72. SharePoint enables coworkers to work simultaneously on a single document, save previous versions, and track updates. Answer: True Difficulty: Easy Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
73. Open Graph is a private social channel that helps employees, partners, and customers communicate; exchange information; and collaborate across departments, locations, and business apps. Answer: False Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
74. Office Graph uses signals from e-mail, social conversations, documents, sites, instant messages, meetings, and more to map the relationships between people and concepts. Answer: True Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
75. With Jive, employees can also create blogs and custom attention streams to track specific people, projects, or groups. Answer: True Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
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76. The latest ERP solutions are designed with a focus on social collaboration, deployment flexibility, faster response, and accessibility from mobile devices. Answer: True Difficulty: Medium Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology 77. From a technology perspective, ERP is the software infrastructure that links an enterprise’s internal applications and supports its external business processes. Answer: True Difficulty: Medium Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
78. ERPs are not built in-house or built using proprietary software because the costs and time to do so would be staggering. Answer: True Difficulty: Medium Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
79. A key factor in lowering manufacturing costs is inventory management—such as minimizing inventory errors and maintaining the optimal inventory level Answer: True Difficulty: Medium Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
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80. Managers and other decision makers tend to think that if an enterprise system works for leading companies, it will work for them too, which is true. Answer: False Difficulty: Hard Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
81. SCM systems are configured to achieve two business goals, which are to increase revenue and maximize inventory. Answer: False Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
82. Supply chains involve the flow of materials, data, and money. Answer: True Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
83. Products that are returned make up what is called the back-office supply chain. Answer: False Difficulty: Easy Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
84. Supply chain links are managed rather than the entire chain; therefore, a company can only manage the links that it actually touches. Answer: True 26
Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
85. Order fulfillment is a part of front-office operations, such as accounting, inventory management, and shipping. Answer: False Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
86. Logistics entails all the processes and information needed to move products from origin to destination efficiently. Answer: True Difficulty: Medium Section Ref: 10.3 Supply Chain Management earning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
87. As global supply chains become more complex and expansive, companies want to leverage analytics that produce insights to improve customer service and reduce costs and risk. Answer: True Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
88. Algorithms and SCM models based on past demand, supply, and business cycles are adequate to effectively manage the supply chain. Answer: False Difficulty: Hard Section Ref: 10.3 Supply Chain Management 27
Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
89. Although most retailers are good at the front-end handling orders through their multiple channels, they tend to struggle to adapt their back-end order fulfillment processes. Answer: True Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
90. Cost reduction is still the number one priority for many supply chain executives, according to the MHI and Deloitte survey. Answer: True Difficulty: Medium Section Ref: 10.3 Supply Chain Management earning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
91. The focus on cost-cutting in the supply chain is squeezing out innovations in sustainability, even though executives believe these investments are important. Answer: True Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
92. The fierce competition among the big four CRM vendors—Salesforce.com, SAP, Oracle, and Microsoft—has focused on cost-cutting which has held back innovation. Answer: False Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. 28
AACSB: Technology 93. According to management guru Peter Drucker, ―Those companies who know their customers, understand their needs, and communicate intelligently with them will always have a competitive advantage over those that don’t." Answer: True Difficulty: Easy Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Reflective thinking
94. CRM and data are necessary, but insufficient. Business performance improvement actually depends to a greater extent on people and processes. Answer: True Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
95. Putting IT department in charge of the CRM project instead of the business users is a CRM best practice. Answer: False Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
96. Users will not tolerate poorly designed CRM systems. Frustrating users is a fast track to failure or suboptimal results. Answer: True Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology 29
97. A formal business plan must be in place before the CRM project begins. The plan must quantify the expected costs, tangible financial benefits, and intangible strategic benefits, and risks. Answer: True Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
98. Intangible CRM benefits are measured using ROI or net present value [NPV]. Answer: False Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
99. Benefits of CRM include increases in number of deals closed, cost avoidance, reductions in inventory costs, and increased customer satisfaction, loyalty, and retention. Answer: True Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
Short Answer 100. Companies use information systems to manage the ___________, which starts with the acquisition of raw materials or the procurement of products and proceeds through manufacture, transport, and delivery—and the disposal or recycling of products. Answer: supply chain Difficulty: Easy Section Ref: Opening Case 10.1 Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems 30
AACSB: Technology
101. Older information systems called _________ have been built with various outdated technologies. Answer: legacy systems Difficulty: Medium Section Ref: Chapter Snapshot Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy systems AACSB: Technology 102. Enterprise systems refer to a category of information systems that run an enterprise’s operations and integrate core ________. Answer: business processes Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
103. ________ is a formula for estimating the dollar value, or worth, of a long-term relationship with a customer. Answer: Customer lifetime value [CLV] Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology 104. ________ customizes or adds features to a vendor’s software or equipment and resells the enhanced product. Answer: Value-added reseller [VAR] Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
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105. ________ refers to private [company-owned] social media, software, platforms, or apps specially designed for use by business leaders and employees to fulfill the strategic mission Answer: Enterprise social Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
106. ________ provides tools for setting up employee social network platforms and company wikis; and can be used to set up a secure, access-controlled extranet site to share with external partners in the supply chain, and contractors. Answer: SharePoint Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology 107. ________ is ―Facebook for business.‖ Answer: Yammer Difficulty: Medium Section Ref: 10.5 Enterprise Social Platforms Learning Objective: Identify the leading enterprise social platforms [ESP] and discuss how they impact collaboration in an organization. AACSB: Technology
108. Typically, ERP systems are acquired by purchasing or leasing in a[n] ________arrangement. Answer: SaaS Difficulty: Medium Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
109. . A key factor in lowering manufacturing or production costs is________ management
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Answer: inventory Difficulty: Medium Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
110. An ERP interfaces with legacy applications through a[n] __________ layer. Answer: enterprise application integration [EAI] Difficulty: Hard Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
111. Many ERP systems incorporate ___________ principles, which involve minimizing inventory errors. Answer: lean Difficulty: Hard Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
112. ________ operations are activities that support the fulfillment of orders. Answer: Back-office Difficulty: Easy Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
113. _______ operations are activities such as sales and advertising that are visible to customers Answer: Front-office Difficulty: Easy Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. 33
AACSB: Technology
114. Products that are returned make up what is called the ________ supply chain because goods are moving in the reverse direction. Answer: reverse Difficulty: Easy Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
115. ________ entails all the processes and information needed to move products from origin to destination efficiently. Answer: Logistics Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
116. ________, also known as additive manufacturing, could revolutionize production processes and have far-reaching future implications for product supply chains. Answer: 3D printing Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
117. ________ can provide managers with a 360-degree view of the customer relationship, enable real-time responses, and improve sales productivity and predictability Answer: CRM Difficulty: Medium Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
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118. ________ assessment is a list of all of the potential pitfalls related to the people, processes, and technology that are involved in the CRM project. Answer: Risk Difficulty: Easy Section Ref: 10.5 Customer Relationship Management Learning Objective: Describe customer relationship management [CRM] systems and their role in customer acquisition, retention, and customer lifetime value. AACSB: Technology
Essay 119. List two types of enterprise systems. Describe the functions performed or supported by these software systems. Answer: See Table 10.2 Enterprise system Enterprise Resource Planning [ERP]
Supply Chain Management [SCM]
Customer Relationship Management [CRM]
Description ERP is the software infrastructure that integrates an enterprise’s internal applications, supports its external business processes, and links to its external business partners. ERP systems are commercial software packages that integrate business processes, including supply chains, manufacturing, financial, HR, budgeting, sales, and customer service. SCM software supports the steps in the supply chain— procurement, sourcing, manufacturing, storage, inventory control, scheduling, order fulfillment, and distribution. SCM improves decision making, forecasting, optimization, and analysis CRM systems help create a total view of customers to maximize share-of-wallet and profitability.
Difficulty: Easy Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Technology
120. List and explain three of the major reasons why companies replace parts of their legacy systems or supplement them with enterprise systems. Answer: 35
High maintenance costs. Maintaining and upgrading legacy systems are some of the
most difficult challenges facing CIOs and IT departments. Inflexibility. Legacy architectures were not designed for flexibility. These huge systems
cannot be easily redesigned to share data with newer systems, unlike modern architectures. Integration obstacles. Legacy systems execute business processes that are hardwired by
rigid, predefined process flows. Their hardwiring makes integration with other systems such as CRM and Web-based applications difficult and sometimes impossible. Lack of staff. IT departments find it increasingly difficult to hire staff who are qualified
to work on mainframes and applications written in languages no longer used by the latest technologies. Cloud. The cloud has lowered up-front costs. Cloud-based enterprise systems can be a
good fit for companies facing upgrades to their legacy ERP and other enterprise systems. Difficulty: Medium Section Ref: 10.1 Enterprise Systems Learning Objective: Name the different types of enterprise systems and explain how they differ from legacy system AACSB: Reflective thinking skills
121. ERP success depends on several key factors being met. List three key factors. Answer: 1. Focus on business processes and requirements. 2. Focus on achieving a measurable ROI. 3. Use a strong project management approach and secure commitment of resources.. 4. Obtain strong and continuing commitment from senior executives. 5. Take sufficient time to plan and prepare up-front. 6. Provide thorough training and change management. Difficulty: Medium Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Reflective thinking skills
122. Why are ERP systems worth their cost? That is, how do companies justify ERP investments? Answer: Answers will vary.
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Decisions are only as good as the timeliness and completeness of the data on which they’re based. The more complete the data, the less the uncertainty and risk involved in the decision process. An ERP provides the integration and automation that makes timely and complete data possible. So it’s not surprising that establishing a reliable pipeline of data from internal functions and external business partners is a priority for businesses in every industry and of all sizes. Manufacturers know that their success depends on lower costs, shorter cycle times, and maximum production throughput. A key factor in lowering costs is inventory management— such as minimizing inventory errors and maintaining the optimal inventory level. An optimal level has enough inventory to keep production running while minimizing inventory-on-hand to control holding costs. ERP demand forecasting modules help manufacturers avoid material shortages, manage production, and coordinate distribution channels, which improves on-time delivery. Engineers, production floor workers, and those in the purchasing, finance, and delivery departments can access and share plans, production status, quality control, inventory, and other data in real time. Difficulty: Medium Section Ref: 10.2 Enterprise Resource Planning Learning Objective: Describe the functions of enterprise resource planning [ERP] systems, implementation risks, and how ERP investments are justified AACSB: Technology
123. Explain supply chain management [SCM]. What are the two business goals that SCM systems are configured to achieve? Answer: Supply chain management [SCM] is the efficient management of the flows of material, data, and payments along the companies in the supply chain, from suppliers to consumers. SCM systems are configured to achieve two business goals: •
To reduce uncertainty and variability in order to improve the accuracy of forecasting.
•
To increase control over processes in order to achieve optimal inventory levels, cycle time, and customer service.
Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Technology
124. The order fulfillment process starts when an order is received, and includes the following nine activities that are supported by SCM software or are automated. Identify and discuss four of the steps in the order fulfillment process. 37
Answer: Step 1: Make sure the customer will pay. Depending on the payment method and prior arrangements with the customer, verify that the customer can and will pay, and agrees to the payment terms. Step 2: Check in-stock availability and reorder as necessary. As soon as an order is received, the stock is checked to determine the availability of the product or materials. Step 3: Arrange shipments. When the product is available, shipment to the customer is arranged. Products can be digital or physical. If the item is physical and available, packaging and shipment arrangements are made. Both the packaging/shipping department and internal shippers or outside transporters may be involved. Digital items are usually available because their ―inventory‖ is not depleted. Step 4: Insurance. The contents of a shipment may need to be insured. Step 5: Replenishment. Customized orders will always trigger a need for some manufacturing or assembly operation. Similarly, if standard items are out of stock, they need to be produced or procured. Step 6: In-house production. In-house production needs to be planned and actual production needs to be scheduled. Production planning involves people, materials, components, machines, financial resources, and possibly suppliers and subcontractors. Step 7: Use suppliers. Appropriate receiving and quality assurance of incoming materials and products must take place. Step 8: Contacts with customers. Sales representatives keep in contact with customers. Step 9: Returns. In some cases, customers want to exchange or return items. Difficulty: Medium Section Ref: 10.3 Supply Chain Management Learning Objective: Explain the planning and forecasting, sourcing and purchasing, and distribution support provided by supply chain management [SCM] systems. AACSB: Reflective thinking
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