Chapter One - Information Systems in Business

1. Explain information technology's role in business.

Information technology refers to the management and use of information using computer-based tools. It includes acquiring, processing, storing and distributing information.

Information Technology is an enable of business functions. It supports the many functions that are in businesses. The benefits of a well implemented IT system can include efficiency, capacity. speed, scalability or accuracy.

http://www.emeraldinsight.com/journals.htm?articleid=843451&show=html

2. What are Efficiency and Effectiveness Metrics? Provide some examples of each.  

Efficiency and effectiveness metrics are two primary types of IT metrics. Efficiency IT metrics measures the performance of the IT system itself. It focuses on technology and includes:

• Throughput
• Transaction speed
• System availability
• Information accuracy
• Web traffic
• Response time

Effectiveness IT metrics measures the impact IT has on business processes and activities. Effectiveness IT metrics focus on organisation's goals, strategies, objectives and includes:

• Usability
• Customer satisfaction
• Conversion rates
• Financial

3. What does Porter's Five Forces Model attempt to explain? How does the internet affect the model?

Porter's five-force model looks at the strength of five distinct competitive forces, which, when taken together, determine long-term profitability and competition. 

The internet affects the model because it allows industries to becomes more competitive, while providing consumers with a greater buying power and lowering the power of suppliers.

http://notesdesk.com/notes/strategy/porters-five-force-model-porters-model/

Link: In depth look at Porter's 5 Forces

  

4. Describe the relationship between business processes and value chains?

Business process: A standardised set of activities that accomplish a specific task. Such as processing a customer's order.

Value chain: Views an organisation as a series of processes, each of which adds value to the product or service. To create a competitive advantage, the value chain must allow the organisation to provide unique value to its customers.

To evaluate the effectiveness of the business Michael Porter's value chain can be used. Having an effective business process and efficient value chain produces an outcome known as a value creation.

http://www.themanager.org/models/valuechain.htm