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Chapter 15 MIS

German companies

do not recognize the profits until they have been formally audited.
do not recognize the profit until the project is completely finished and they have been paid.
do not have profits, but instead report dividends.
recognize profits when the project is initialized.
recognize profits before the project is finished.

do not recognize the profit until the project is completely finished and they have been paid.
VPNs

are expensive to develop and maintain.
use the public Internet for communications.
provide all the same services as private networks.
provide guaranteed levels of service.
can be used only for data but not voice traffic.

are expensive to develop and maintain.
To avoid the cost and uncertainty of moving information across national boundaries, most multinational firms

use microwave satellite transmission to move data.
develop separate systems within each country.
maintain a master database at their head offices.
develop a master system that meets the standards of all the countries concerned.
use a cloud-based service.

develop separate systems within each country.
Transnational companies have tended to use a(n) ________ systems
configuration.

duplicated
autonomous
centralized
networked
decentralized

networked
In terms of global business strategy, the governance of ________ firms has been likened to a federal structurestrong central management core of decision making, but considerable dispersal of power and financial resources.

domestic exporter
franchiser
domestic importer
multinational
transnational

transnational
In terms of global business strategy and structure, a multinational company will use a policy of

centralized production, accounting, marketing, human resources, with strategic management.
mixed sales and marketing, with centralized production, accounting, human resources, and strategic management.
dispersed production and marketing, with centralized accounting and strategic management.
making local units that are clones of the mother country units.
dispersed production, accounting, human resources, with centralized strategic management, and marketing.

dispersed production and marketing, with centralized accounting and strategic management.
Which of the following is not one of the primary types of firm strategy discussed in the chapter?

transnational
domestic exporter
multinational
franchiser
international exporter

international exporter
In cooptation

the systems used on the company’s home country are modified to communicate with the systems of foreign units so that each unit can retain their unique business processes.
the systems of specific foreign units are chosen to duplicate for use by other units.
the new global system replaces all unit systems, including systems in the home territory.
opponents to a planned global system are brought into the process of designing and implementing the solution.
all the relevant parties are asked to participate in the design of global systems.

opponents to a planned global system are brought into the process of designing and implementing the solution.
In a multinational strategy, financial management is centralized while production and sales are decentralized.
True
False
True
Domestic exporters typically have highly ________ systems.
autonomous
networked
duplicated
decentralized
centralized
centralized
With the growth of the Internet and reliable phone networks, skilled consultants are readily available to companies operating in global markets.
True
False
False
When developing a global system, bringing the opposition of local groups into the process of designing and implementing the solution without giving up control over the direction and nature of the change is called

cooperation.
cooptation.
change management.
advocacy.
implementation.

cooptation.
In terms of global business strategy and structure, a franchise company will use a policy of

dispersed production, marketing, and human resources, with centralized strategic management and finance/accounting.
decentralized production, accounting, human resources, with a decentralized management.
centralized production, accounting, marketing, human resources, with strategic management.
dispersed production and marketing, with centralized accounting, human resources and strategic management.
dispersed production, accounting, human resources, with centralized strategic management, and marketing.

dispersed production, marketing, and human resources, with centralized strategic management and finance/accounting.
As a firm moves from local option systems to regional and global systems

coordination costs decrease.
both transaction and agency costs increase.
all costs increase.
transaction costs increase.
agency costs increase.

agency costs increase.
A powerful strategic advantage for a globalized firm is lowered cost factors in production.
True
False
True
Micromarketing describes the direct marketing of products to individuals rather than groups.
True
False
False
In international companies, English has become a kind of standard business language.
True
False
True
Based on your reading of the chapter, why should companies avoid creating an all-encompassing, new global system when moving towards global operations?

It is difficult to quantify and explain the benefits of information systems that are large.
This approach will fail because of a lack of concrete objectives.
This approach may fail due to a lack of visibility.
“Grand design” approaches typically fail to identify centers of excellence.
Opposition is strengthened because of requirements for huge resources.

Opposition is strengthened because of requirements for huge resources.
To comply with European privacy laws, many multinational firms have developed information systems within each European country.
True
False
True
In developing countries, use of the Internet is limited by all of the following except

political disruptions.
poor bandwidth capacity.
use of mobile telephones.
unreliable power grids.
high cost of PCs.

use of mobile telephones.
While private networks have guaranteed service levels and better security than the Internet, the Internet is the primary foundation for global corporate networks when lower security and service levels are acceptable.
True
False
True
International information systems refer to

the basic information systems required by organizations to coordinate worldwide trade and other activities.
systems used by international businesses.
systems that are developed by global firms.
systems that talk to one another using the global Internet.
business processes that span the globe.

the basic information systems required by organizations to coordinate worldwide trade and other activities.
Which types of systems are widely used by manufacturing and distribution firms to connect to suppliers on a global basis?
CRM systems
management information systems
EDI systems
TPS systems
enterprise systems
EDI systems
In a franchiser business strategy, each foreign unit designs its own solutions and systems.
True
False
False
Multinational companies tend to dominantly have ________ systems.
decentralized
duplicated
centralized
networked
autonomous
decentralized
Global business drivers can be divided into two groups: general cultural factors and specific business factors.
True
False
True
Which of the following is not one of the main benefits to implementing global systems?
vast improvements in operation
optimize use of corporate funds
reduced hardware costs
new economies of scale at production facilities
superior management and coordination
reduced hardware costs
Which of the following is not one of the principal problems of international networks?
installation delays
network capacity
regulatory constraints
poor quality of international service
network standards
network standards
Global coordination of all of the major business functions permits the location of business activity according to

labor costs.
knowledge base.
competitive threat.
comparative advantage.
social norms and values.

comparative advantage.
In networked systems

development occurs at the home base and operations are handed over to autonomous units in foreign locations.
foreign units design the solutions and systems used at the domestic home base.
systems development and operations occur in an integrated and coordinated fashion across all units.
each foreign unit designs its own unique solutions and systems.
development occurs at the home base but operations are handed over to autonomous units
in foreign locations.

systems development and operations occur in an integrated and coordinated fashion across all units.
Most companies pursuing a global strategy begin as

domestic exporters.
multinationals.
franchisers.
transnationals.
conglomerate corporations.

domestic exporters.
Software localization is important for global systems because

only some users need to know English, while others can use their local languages.
all users need to be trained in English to use global systems.
productivity of employees rises when systems use their local languages.
most managers around the world use English as their business language.
computer programs are almost always written in English.

productivity of employees rises when systems use their local languages.
Effective networked systems must have a

shared management culture that crosses cultural barriers.

culture of shared applications development.

powerful telecommunications backbone.

both B and C.

A, B, and C.

A, B, and C.
A critical necessity for ensuring the integration of local systems into a global system is

use of standard user software at the local level.
use of standard hardware at the local level.
adherence to data and technical standards.
using localized software.
using standard computers throughout the system.

adherence to data and technical standards.
Particularism is a concept based on accepting a shared global culture and the penetration of domestic markets by foreign goods and services.
True
False
False
A force in the environment to which businesses must respond and that influences the direction of the business is called a business
driver.
process.
matrix.
strategy.
threat.
driver.
All of the following present challenges to developing global business systems except
exchange rates.
shortages of skilled consultants.
foreign accounting practices.
production costs.
language differences.
production costs.
The collapse of the Eastern block has retarded the growth of a world culture.
True
False
False
A company that controls finances in the home country and decentralizes production, sales, and marketing operations to other countries is using a ________ strategy.
multinational
franchising
transnational
conglomerate
domestic exporter
multinational
A global firm can develop transnational centers of excellence as an effective technique to

encourage user support of global systems.
effectively identify global business processes.
ensure connectivity between regional systems.
develop a merit-based hierarchy among regional groups.
identify who opposes the proposed global changes.

effectively identify global business processes.
The growth of powerful communications technologies and the emergence of world cultures create the condition for global markets.
True
False
True
The growth of powerful communications technologies and the emergence of world cultures have failed to create a foundation for global markets.
True
False
False
Which of the following is not an important technology issue to consider when developing an international information system?

standardizing the global computing platform
finding specific software applications that are user friendly and enhance productivity
developing common data standards
building sufficient connectivity
deciding how mobile computing will fit into your international system

deciding how mobile computing will fit into your international system
In terms of global business strategy and structure, a multinational strategy

concentrates financial management and control out of a central home base while decentralizing production, sales, and marketing operations to units in other countries.

centralizes production, accounting, marketing, and human resources.
concentrates production and marketing in each country, and decentralizes accounting and human resources.

centralizes production and accounting and decentralizes marketing and human resources.

disperses production and marketing, with centralized accounting, human resources and strategic management.

concentrates financial management and control out of a central home base while decentralizing production, sales, and marketing operations to units in other countries.
The major dimensions of international systems architecture include each of the following except

technology platform.
transborder data flows.
management and business processes.
corporate global strategy.
the global environment.

transborder data flows.
Which of the following is not one of the principal management challenges in developing global systems?

agreeing on common user requirements
coordinating applications development
defining an acceptable test plan
introducing changes in business processes
encouraging local users to support global systems

defining an acceptable test plan
In relation to global systems building, the Internet

affords local groups stable broadband access.
reduced the need for skilled IT employees.
has increased the need for private networks.
has reduced networking problems.
allows the seamless flow of information through the enterprise.

has reduced networking problems.
Global markets, production, and administration create the conditions for:
domestic exporter kinds of businesses
global systems
global economies of scale
a truly global labor force
localized software
global economies of scale
There are two primary global organization types: management centralized in the home country or distributed to foreign centers.
True
False
False
In order to define centers of excellence in a global firm, you would first need to identify
SOPs.
functional areas.
core business processes.
international best practices.
core competencies.
core business processes.
Which of the following is not a specific challenge to global business systems?

unreliable phone networks
cultural expectations
shortages of skilled consultants
different telecommunication standards
different data transfer speeds

cultural expectations
Most large companies with overseas operations have inherited

batch-oriented reporting from independent foreign divisions to corporate headquarters.
transaction-oriented reporting based at the home office for overseas business.
enterprise systems developed by local firms.
global marketing systems developed domestically.
recently built technology platforms for international systems.

batch-oriented reporting from independent foreign divisions to corporate headquarters.
From your reading of the chapter case, which of the following best describes the challenge Unilever was facing as a global company?

lack of buy-in for global systems by foreign units
too many systems in too many data centers, making it difficult to process transactions in a timely fashion
inadequate information for managerial decision making
managing a global supply chain
poor governance of global systems

too many systems in too many data centers, making it difficult to process transactions in a timely fashion
In decentralized systems

systems development and operations occur in an integrated and coordinated fashion across all units.
development occurs at the home base and operations are handed over to autonomous units in foreign locations.
all systems are designed in domestic headquarters and then distributed to foreign units.
each foreign unit designs its own unique solutions and systems.
foreign units design the solutions and systems used at the domestic home base.

each foreign unit designs its own unique solutions and systems.
What is the first thing you should consider when thinking about building an international information system?

look for new technologies that will help you achieve your goals
the different computing and communication standards in the world
the business challenges you face in the global environment
consider the global environment where your business will operate, and identify the business drivers for your firm and industry
the state of world politics

consider the global environment where your business will operate, and identify the business drivers for your firm and industry
Making judgments and taking action on the basis of narrow or personal characteristics is referred to as

globalization.
localization.
particularism.
cooptation.
prejudicial.

particularism.
General cultural factors driving global business are

the rise of the global workforce, political stability, and a global knowledge base.
global communication and transportation technologies, a global knowledge base, and global social norms.
the development of global markets, political stability, and a global workforce.
the rise of a global workforce, global economies of scale, and global production and operations.
growth of a global village spurred by television, the Internet, and computerization.

global communication and transportation technologies, a global knowledge base, and global social norms.
In duplicated systems

each foreign unit designs its own unique solutions and systems.
systems development and operations occur in an integrated and coordinated fashion across all units.
development occurs at the home base and operations are handed over to autonomous units in foreign locations.
systems development is a combined effort of domestic and international units which are then duplicated across the world.
foreign units design the solutions and systems used at the domestic home base.

development occurs at the home base and operations are handed over to autonomous units in foreign locations.
Franchise companies have typically had ________ systems.
decentralized
networked
centralized
duplicated
autonomous
duplicated
Software localization is the process of

converting software programming to run on a different platform.
modifying software so executives can understand its command language.
modifying software so that it can be adopted in other countries without engineering changes.
converting software to operate in a second language and with local conventions.
translating a user interface into a second language.

converting software to operate in a second language and with local conventions.
One major telecommunications challenge in an international setting is making data flow seamlessly across networks shaped by disparate national standards.
True
False
True
Which of the following is not an important factor when implementing a global information system solution?

introducing changes in business processes
coordinating applications development
understanding if your computer system can operate in a global environment
agreeing on common user requirements
coordinating software releases

understanding if your computer system can operate in a global environment
Which systems are worth sharing on a transnational basis, from a cost and feasibility point of view?

core systems and any financial systems that can be easily integrated with each other
financial and accounting systems
core systems and worthwhile provincial systems
systems that support decentralized units
only systems that support functions that are absolutely critical to the organization

only systems that support functions that are absolutely critical to the organization
In a multinational business strategy, the ________ business function is decentralized, dispersed to foreign units.

production
sales/marketing
strategic management
human resources
finance/accounting

production
In a transnational business strategy, all of the regional units participate and coordinate over all activities, from production to sales.
True
False
True
The chapter outlines four steps in developing an effective global system solution. Which of the following is not one of these steps?

Define the core business processes.
Choose a developmental approach, incremental, evolutionary, or other.
Make the benefits clear.
Identify outdated legacy systems to be replaced.
Identify the core systems to coordinate centrally.

Identify outdated legacy systems to be replaced.
Which of the following is not a business driver of global business?
political stability
global communication and transportation technologies
development of global culture
growth of international systems
emergence of global social norms
growth of international systems
Which of the following is not one of the main organizational issues facing firms who are seeking to globalize?
defining the global environment
organizing the business
organizing the systems management
organizing the global business structure
choosing a global strategy
defining the global environment
European countries have very strict laws concerning transborder data flows and privacy.
True
False
True
The network systems structure is the most visible in ________ services.
software design
production
administrative
financial
marketing
financial
Transnational firms have

headquarters in the home country with smaller headquarters around the world.
a centralized headquarters but not in the home country.
no single headquarters.
no single national headquarters but many regional headquarters and perhaps a world headquarters.
headquarters in each country where they do business.

no single national headquarters but many regional headquarters and perhaps a world headquarters.
Transborder data flow refers to

the movement of information across international boundaries.
the business of moving information from one country to another.
the flow of information in international systems.
the ways in which a countries laws change the flow of data from one country to another.
the business process of coordinating information from many different countries.

the movement of information across international boundaries.
Accounting practices can vary significantly from country to country.
True
False
True
In centralized systems

systems development and operations occur in an integrated and coordinated fashion across all units.
development occurs at the home base and operations are handed over to autonomous units in foreign locations.
systems development is a combined effort of domestic and international units.
each foreign unit designs its own unique solutions and systems.
systems development and operations occur totally at the domestic home base.

systems development and operations occur totally at the domestic home base.
Of the following, which is one of the central principles recommended in this chapter for a firm organizing itself for international business?

Establish multiple offices for international systems and a global CIO position.
Centralize production, but decentralize marketing and sales to be close to the customer.
Develop and operate systems units at the international level first.
Organize value-adding activities along lines of comparative advantage.
Disperse production and marketing to regional centers and establish a single center for world headquarters and strategic management.

Organize value-adding activities along lines of comparative advantage.
Japanese consumers who only want to purchase products made in Japan are an example of

political culture.
universal global attitudes.
different laws in different countries.
different business standards.
cultural particularism.

cultural particularism.
The way to identify core business processes is to conduct a

feasibility analysis.
business process analysis.
work-flow analysis.
systems analysis.
cost-benefit analysis.

business process analysis.
Which of the following is not one of the system configurations used by global firms?
centralized
networked
decentralized coordinated
localized
duplicated
networked
Global systems allow fixed costs to be amortized over a much smaller customer base.
True
False
False

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