AP/ADMS 2511 - Management Information Systems Practice Midterm 2 Covering Sessions 1 to 4 and 6 to 8 inclusive (Units 1 to 7 in the Internet Section)

) Answer Guide Question 1 (Westwood Couture) A) You have been asked to prepare a report outlining the ethical and legal issues that Westwood Couture would face if it decides to move to an (online) e-business presence. Describe three ethical and/or legal issues arising from the nature of e-business that Westwood Couture would need to consider. For each issue, provide a recommendation as to how Westwood Couture could address this issue. (6 Marks) Description of THREE ethical and/or legal issues arising from the nature of e-business Ethical Issues Privacy Easier to store and transfer personal information. Electronic payment systems know who the buyers are. Recommend how Westwood could address this issue

Protect the buyers' identities though privacyolicies, privacy and security controls and employee training. Use encryption to provide protection over electronic payments and/or personal Tracking - individuals' activities on the Internet information. can be tracked by cookies. Install programs to exercise some control over cookies. Job Loss E-commerce may eliminate need for some Offer laid off workers alternative positions. company's employees, as well as brokers and Offer skills retraining so that employees can agents. The manner in which these unneeded find positions elsewhere. workers, especially employees, are treated can Offer compensation packages to facilitate raise issues such as: employees transitions. -How should the company handle the layoffs? Offer career counseling and personal - Should companies be required to retrain counseling to help employees transition to new employees for new positions? careers and handle personal difficulties - If not, how should the company compensate associated with being laid off. or otherwise assist the displaced workers? Legal issues Fraud on the Internet Easier to have fictitious or phony credit cards Use payment processors for credit card used for sales. processing that check for known phony credit Phishing scams- growing use of e-mail means cards. that financial criminals now have access to Encourage employees to report all online crime many more people. immediately. Provide customer protection so that if they are the subject of crime, they receive adequate
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Description of THREE ethical and/or legal issues arising from the nature of e-business Domain Names Competition over domain names: -When several companies with similar names compete over a domain name. Cybersquatting- practice of registering or using domain names for the purpose of profiting from the goodwill or trademark that belongs to someone else. The practice is legal, but certainly can be thought of as unethical. Taxes and Other Fees Most provinces and localities tax business transactions that are conducted within their jurisdiction, e.g. sales taxes. Federal, provincial, and local authorities are scrambling to figure out how to extend these policies to ebusiness. -Complex for interprovincial and international e-commerce, e.g. where sellerand purchasers are located affect the nature and type of sales tax Copyright Protecting intellectual property in e-commerce is very difficult: -Hundreds of millions of people in some 200 countries with differing copyright laws having access to billions of web pages which makes it difficult to protect intellectual property rights. -Some people mistakenly believe that once they purchase a piece of software, they have the right to share it with others. -Copying material from websites without permission is a violation of copyright laws.

Recommend how Westwood could address this issue compensation and recompense. Not engaging in competition over domain names and registering in new domains only. Paying fair prices to competitors for existing domain names. Not entertaining cyber squatters who approach Westwood Couture to sell their domain names to the company. Implement accounting controls within ERPs, TPS systems to ensure taxes are calculated accurately and completely. Provide relevant training to employees to ensure tax compliance. Ensure accounting, ERP and TPS systems calculate, process and remit taxes to authorities accurately, completely and on time.

Implement appropriate use policies to ensure employees understand that information contained on websites is subject to copyright laws, that the illegal sharing and downloading of unauthorized software will not be permitted on corporate computing devices and that there are severe penalties, including dismissal, for such actions. Disable administrative level access to computers so that employees cannot install software. Implement software audits to periodically check machines for unauthorized software.

Source: Section 6.5, p.193-196

B)

What is Radio Frequency Identification (RFID) Technology? (1 mark)

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- RFID technology allows retailers and manufacturers to attach tags with antennas and computer chips on their goods and products so that they can track their movement. - RFID is slowly replacing bar codes. Source: Section 7.4, p. 226-228 C) List and describe two (2) ways that Westwood Couture could make use of RFID in its retail operations. (2 marks) RFID can allow stores to uniquely identify every item in the store. RFID can allow information to be stored and transmitted about an item, such as its current location, where it was made, when it was made or transferred to the store. RFID can help to prevent theft of high value priced items as it will transmit information as soon as the tag passes a reader. RFID can help with inventory management within the stores as all stock related information can be derived from the RFID tags.

Source: Section 7.4, from p. 226, applied example D) Westwood Couture decided to hire a computer programmer to develop the e-commerce website. The site will be used to allow customers to browse products, search for information and purchase products. For the following programming languages, describe the language and provide an example of how the programmer could make use of it during the development of the company website. (4 marks) Description of the programming language Hypertext mark-up language (HTML) Used for creating and formatting documents on the World Wide Web. HTML gives users the option of controlling visual elements such as fonts, font size, and paragraph spacing without changing the original information. Extensible mark-up language (XML) Improves functionality of web documents by describing what the data in documents actually means, as well as the business purpose of the documents themselves. Improves compatibility among disparate systems of business partners by allowing XML documents to be moved to any format on any platform without the elements losing their meaning. Example of how the language can be used to build Westwoods website create new web pages Format web pages to make them visually appealing, use of fonts, colour and graphics Space information on a web page to avoid clutter and make the pages easy to read and navigate

Allows Westwood Couture to describe documents online so that they can be shared with other sites and systems. Sets up the web site so users can access the same information using different devices, such as a browser or smart phone. Enables the use of shopping cart and payment process online as information collected can be stored, processes and transmitted to other systems in order to
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Description of the programming language As a result, the same information can be published to a web browser, a PDA, or a smart phone and each device would use the information appropriately. Note: XML and HTML are not the same. The purpose of HTML is to help build web pages and display data on web pages. The purpose of XML is to describe data and information.

Example of how the language can be used to build Westwoods website fully complete an order.

Source: Section TG2.5, p. 402-403, plus applied example Question 2 (Hampsteads) You are the new Information Systems Manager for Hampsteads, a fortune 500 company. Hampsteads is a multinational wholesaler and retailer of building products and building solutions. It has two million customers and approximately 300 stores which are stocked with more than 40,000 items. All of this business generates billions of customer sales transaction records per year. The amount of data and processing power is so great that Hampsteads operation runs on some 500 servers. Surprisingly, Hampsteads still operates with a patchwork of transaction processing systems some are software packages from various vendors and some are in-house developed systems. Required: A) For each of the following types of organizational information systems, explain the function of the system and provide a specific example of how Hampsteads might be using the organizational system. (4 marks) Explain the function of each organizational information system (noted below) Real-Time Transaction processing system Processes transaction data from business events immediately as they occur. Source: Section 8.1, p. 240 Specific example of how Hampstead might use the organizational information system Some possible examples include: - retail point-of-sale systems: recording the sale; processing debit/credit card payment; updating commercial accounts - sales of product through on-line direct marketing website - supply chain: recording inventory transactions Accounting & Finance: record cash received, make payments, record assets Operations/Logistics: track movement of inventory
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Functional area information system Supports activities (business processes) within a specific business area, including

transactions, exception-handling, and reporting based directly on transaction details. Source: Section 8.2, from p. 242

Sales & marketing: handle CRM HR: Recruitment, record payment details, handle system access rights

B) The Hampstead president has asked you to prepare a brief outline of a presentation you will make to the senior company managers to convince them that it is time to implement a comprehensive ERP (Enterprise Resource Planning) system. State THREE advantages of an ERP system to Hampstead. (3 Marks) The reasons for implementing a comprehensive ERP system are as follows (any three of): To help improve information communication among the functional area information systems Can increase organizational productivity Can integrate functional areas through a common database Has the ability to provide information necessary to control the business processes of an organization Follows business process best practices Section 8.3, p. 251-253
C) State two disadvantages of an ERP system to Hampstead. (2 Marks

Disadvantages of an ERP system for Hampstead (any 2 of): Extremely complex for Hampstead to implement Expensive for Hampstead to purchase Time-consuming for Hampstead to implement Hampstead may need to change existing business processes to fit the predefined business processes (best practices) of the ERP system Section 8.3, Page 252-254

D) Explain how each of the following technologies could be used by an organization such as Hampstead to provide computing resources. (3 marks) Technology Grid Computing How it could be used by Hampstead (Applying the resources of many computers in a network to a single problem at the same time ) processes large amount of information including sales analysis -- Can handle complex problems that require many processing cycles and large amounts of data, such as logistics of shipping (Service provider makes computing resources available to customers over the Internet, on a pay-per-use basis) -meet fluctuating demands for computing without requiring investments in infrastructure adequate to meet peak demands, for example seasonal sales peaks (Massive data centre with hundreds of thousands of networked servers) - massive and scalable capacity for managing, transmitting and storing data - provide redundancy and fault tolerance

Cloud Computing

Server farm

Section TG1.3, p. 366-368 Questions 3 and 4 - Multiple Choice Questions (50 marks 100 minutes) 1. ANS: C 2. ANS: B 3. ANS: A 4. ANS: B 5. ANS: D 6. ANS: D 7. ANS: C 8. ANS: B 9. ANS: B REF: REF: REF: REF: REF: REF: REF: REF: REF: Ch 1, Section 1.3, P.11 Ch 1, Section 1.3, P. 12 Ch 1, Section 1.4, P. 14 Ch. 3, Section 3.1, P. 75 Ch, 3, Section 3.3, P. 99 Ch. 3, Section 3.1, P. 72 TG 3, Section TG3.2, p. 430 Ch. 4, Section 4.2, p.117-8 CH. 4, Section 4.3, P. 120
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10. ANS: C 11. ANS: D 12. ANS: B 13. ANS: C 14. ANS: D 15. ANS: A 16. ANS: C 17. ANS: B 18. ANS: A 19. ANS: D 20. ANS: C 21. ANS: B 22. ANS: B 23. ANS: C 24. ANS: B 25. ANS: D 26. ANS: A 27. ANS: C

REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF:

Ch 4, Section 4.3, P. 121 Ch. 4, Section 4.2, P. 115 Ch. 5, Section 5.2, p. 159 TG4, Section TG4.3, p.444- 445 Ch. 5, Section 5.2, P. 161 TG 4, Section TG4.1, P. 438 Ch 6, Section 6.2, P 178 TG1, Section TG1.7, P. 383 TG1, Section TG1.7, P. 382 Ch 8, Section 8.1, p. 240 Ch. 7, Section 7.2, P. 218 CH. 7, Section 7.3, P. 226 TG2, Section TG2.2, P. 394 TG2, Section TG2.4, P. 398 TG1, Section TG1.4, P. 374 TG 1, Section TG1.7, P.385 TG2, Section TG2.3, P. 397

REF: CH. 8, Session 8/Unit 7 overhead titled functional area systems

28. ANS: D, REF: Ch 8, Session 8/Unit 7 overhead titled functional area: production/operations management (continued) 29. ANS: A 30. ANS: B 31. ANS: D REF: REF: REF: Ch. 7, Section 7.1, P. 212 Ch. 7, Section 7.1, P. 214 TG1, Section TG1.4, P. 373
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32. ANS: A 33. ANS: D

REF: REF:

TG2, Section TG2.1, P. 397 Ch. 6, Section 6.1, P. 177

34. ANS: B , REF: Session 7/Unit 6, Slide titled Reducing Information Asymmetry with the help of the Internet 35. ANS: C, REF: Session 7/Unit 6, Slide titled The Internet and Reach 36. ANS: C 37. ANS: D 38. ANS: B 39. ANS: D 40. ANS: B 41. ANS: D 42. ANS: C 43. ANS: D 44. ANS: B 45. ANS: C 46. ANS: A 47. ANS: B 48. ANS: C REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: REF: Ch. 7, Section 7.2, P. 215 Ch. 7, Section 7.2, P 215 TG1, Section TG1.4, P. 373 TG1, Section TG1.3, P. 370 Ch. 8, Section 8.2, P. 249 Ch. 8, Section 8.1, P. 240 Ch. 8, Section 8.1, P. 240 Ch. 8, Section 8.2, P. 249 Ch. 8, Section 8.2, P. 249 Ch. 8, Section 8.3, P. 250 Ch. 8, Section 8.2, P. 247 Ch. 8, Section 8.2, P. 249 Ch 6, Section 6.1, P. 177 TG1, Section TG1.5. P. 376 TG1, Section TG1.4, p. 371

49. ANS: A 50. ANS: B