Enterprise Systems For Management 2nd Edition Motiwalla Test Bank

Enterprise Systems For Management 2nd Edition Motiwalla Test Bank

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 1 Introduction to Enterprise Systems for Management 1) The Hershey's example shows the complexity of implementing ERP systems in organizations.

Answer: TRUE Diff: 1 Page Ref: 3 2) In the early days of ERP implementation, management clearly understood the magnitude of organizational issues to consider before and during ERP implementations.

Answer: FALSE Diff: 1 Page Ref: 3 3) ERP systems are not much different from conventional software packages like Microsoft Office.

Answer: FALSE Diff: 1 Page Ref: 3 4) ERP implementations usually go beyond technical issues, to include people, process and change issues.

Answer: TRUE Diff: 2 Page Ref: 3 5) eBusiness is an adaptive technology as opposed to ERP which is a disruptive technology.

Answer: FALSE Diff: 2 Page Ref: 24 6) During the input phase of an Information System, the people components are most prominent.

Answer: TRUE Diff: 2 Page Ref: 5 7) No single information system can support all the needs of a business.

Answer: TRUE Diff: 1 Page Ref: 4 8) At the mid-management level, functions are highly structured and the resources are predefined.

Answer: FALSE Diff: 2 Page Ref: 5 9) Quantitative requirements are usually much greater at the operational level.

Answer: TRUE Diff: 2 Page Ref: 6 10) Strategic level functions are usually more unstructured.

Answer: TRUE Diff: 2 Page Ref: 5 1 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

11) Because of the increasing pressure of global competition, businesses are becoming less integrated and more compartmentalized.

Answer: FALSE Diff: 2 Page Ref: 5 12) The goal of an ERP system is to integrate data and support all the major functions across the organization.

Answer: TRUE Diff: 1 Page Ref: 6 13) One problem with ERP systems is that they do not update data in real-time.

Answer: FALSE Diff: 1 Page Ref: 8 14) Historically, each department had its own separate computer system that was designed for the specific tasks in that department.

Answer: TRUE Diff: 2 Page Ref: 7 15) In the 1960s and 1970s organizations first began to focus on developing integrated, enterprise systems.

Answer: FALSE Diff: 1 Page Ref: 9 16) ERP systems grew primarily out of MRP and MRP II. Answer: TRUE Diff: 2 Page Ref: 9 17) ERP II expanded to include B2B functions and EDI. Answer: TRUE Diff: 3 Page Ref: 9 18) ERP systems today have evolved to the more flexible mainframe and centralized legacy application architecture.

Answer: FALSE Diff: 2 Page Ref: 9 19) ERP systems usually don't require businesses to change their business processes.

Answer: FALSE Diff: 2 Page Ref: 10 20) It is generally easier for an organization to modify the ERP software to fit their existing business processes.

Answer: FALSE Diff: 3 Page Ref: 10

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21) A database is considered to be one of the key components of an ERP system.

Answer: TRUE Diff: 2 Page Ref: 10 22) When ERP software is purchased from a vendor, this is known as a "vendor-driven" architecture.

Answer: FALSE Diff: 2 Page Ref: 11 23) The architecture of the ERP system is determined well before the ERP software is chosen.

Answer: FALSE Diff: 3 Page Ref: 11 24) One benefit of implementing an ERP system is that the implementations are usually quite similar from one organization to another.

Answer: FALSE Diff: 3 Page Ref: 15 25) The physical architecture of an ERP system focuses on the efficiency of the system.

Answer: TRUE Diff: 2 Page Ref: 12 26) The most important lesson learned by Hershey in their ERP implementation was that they should proceed slowly so that nothing is left out during the implementation.

Answer: TRUE Diff: 2 Page Ref: 3 27) ERP systems are a specific kind of enterprise system to integrate data across all major functions of an organization.

Answer: TRUE Diff: 1 Page Ref: 6 28) A goal of ERP systems is to make information flow be both dynamic and immediate.

Answer: TRUE Diff: 1 Page Ref: 6 29) ERP and e-Business are diverse technologies.

Answer: FALSE Diff: 2 Page Ref: 16 30) In the tiered architecture of an ERP system, the ERP software is actually loaded onto the data tier.

Answer: FALSE Diff: 3 Page Ref: 13

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31) The lowest tier of the ERP tiered architectures is where the database server is located.

Answer: TRUE Diff: 3 Page Ref: 13 32) e-Business is an example of a non-disruptive technology.

Answer: FALSE Diff: 2 Page Ref: 16 33) In a tiered ERP architecture, users interact with the system via the presentation logic tier.

Answer: TRUE Diff: 3 Page Ref: 13 34) ERP represents a(n) adaptive technology.

Answer: TRUE Diff: 2 Page Ref: 16 35) On corporate intranets, ERP functionality is delivered using no internet-based protocols.

Answer: FALSE Diff: 3 Page Ref: 17 36) One roadblock for ERP systems is that they require a substantial investment in order to be successful.

Answer: TRUE Diff: 2 Page Ref: 17 37) As opposed to e-Business systems, ERP systems are focused more on internal process integration.

Answer: TRUE Diff: 2 Page Ref: 17 38) An ERP system implementation is less complex than a typical Information System implementation.

Answer: FALSE Diff: 2 Page Ref: 18 39) At the start of an ERP implementation, it is important that clear and well-defined data design be communicated to the organization.

Answer: FALSE Diff: 3 Page Ref: 19

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40) A(n) ________ is defined as a series of tasks or activities grouped to achieve a business function or goal.

A) software design B) system prototype C) business process D) information system Answer: C Diff: 2 Page Ref: 40 41) Checking inventory is an example of a(n): A) software function.

B) system function.

C) database.

D) business process.

Answer: D Diff: 1 Page Ref: 10 42) When an ERP system is upgraded, this means that the IT staff will have to upgrade not only the existing application, but also any ________ they have made.

A) modifications B) protections C) designs D) decisions E) clarifications Answer: A Diff: 3 Page Ref: 10 43) An Information System includes each of the following except: A) software.

B) culture.

C) hardware.

D) data.

Answer: B Diff: 2 Page Ref: 4 44) An ERP architecture consists of both a physical architecture and a(n): A) labor component.

B) system architecture.

C) database.

D) logical architecture.

E) system documentation.

Answer: D Diff: 2 Page Ref: 11

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45) All of the following are components of an ERP system except: A) tools.

B) hardware.

C) processes.

D) people.

E) databases.

Answer: A Diff: 1 Page Ref: 10 46) The general goal of an Information System is to convert data into useful: A) procedures.

B) tools.

C) information.

D) data flows.

Answer: C Diff: 1 Page Ref: 4 47) A(n) ________ is a dynamic sub-organization that can be created and eliminated depending on need.

A) strategic group B) Business Unit C) department D) matrix group E) IT group Answer: B Diff: 2 Page Ref: 5 48) Which of the following is not a component of an Information System?

A) hardware B) people C) data D) software E) output Answer: E Diff: 2 Page Ref: 4 49) ERP systems are ________ which means they can be accessed using a web client.

A) functional B) cross-functional C) real-time D) integrated E) web-enabled Answer: E Diff: 2 Page Ref: 7

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50) The concept of ________ means that clean data can be entered once and then reused across all applications.

A) cross-data reports B) data integration C) real-time access D) data flows E) system integration Answer: B Diff: 2 Page Ref: 8 51) During the 1960s and 1970s most organizations designed their systems in a ________ manner.

A) interrelated B) cross-functional C) componentized D) silo E) cohesive Answer: D Diff: 2 Page Ref: 8 52) ERP systems integrate a business' processes across their: A) system boundaries.

B) functional dependencies.

C) value chain.

D) sales activities.

Answer: C Diff: 2 Page Ref: 8 53) ERP vendors embed ________ in their software.

A) components B) data C) protocols.

D) best practices E) upgrades Answer: D Diff: 3 Page Ref: 8 54) A "vanilla" ERP implementation is when the organization decides to implement the ERP software: A) "as is."

B) quickly.

C) with B2B capabilities.

D) without complex interfaces.

E) with special additions.

Answer: A Diff: 2 Page Ref: 10 7 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

55) ERP system implementation failures are often caused by lack of attention to the business processes and the ________ components.

A) interrelated B) hardware C) software D) database E) people Answer: E Diff: 2 Page Ref: 10 56) The ________ approach to implementing an ERP system helps organizations lower the longterm maintenance of the ERP application.

A) RAD B) layered C) waterfall D) data flow Answer: B Diff: 3 Page Ref: 10 57) ERP systems help to increase the efficiency of the organization and worker productivity by providing a ________ for all corporate data, information, and knowledge.

A) network B) platform C) architecture D) central repository E) decentralized archive Answer: D Diff: 2 Page Ref: 14 58) In the tiered architecture, the ERP application is stored on the ________ tier.

A) presentation logic B) business logic C) middleware D) data E) hardware Answer: B Diff: 3 Page Ref: 14 59) A strong commitment from ________ is critical for the success of an ERP system.

A) people B) vendors C) management D) users E) system administrators Answer: C Diff: 3 Page Ref: 15 8 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

60) ________ an ERP system during the implementation increases the cost of the system and increases the implementation risks.

A) Integrating B) Diagramming C) Delaying D) Outsourcing E) Modifying Answer: E Diff: 3 Page Ref: 18 61) A ________ implementation involves considerable modifications to the ERP software.

A) chocolate B) vanilla C) cross-functional D) vendor-driven E) web-enabled Answer: A Diff: 3 Page Ref: 18 62) Because they lack the skill sets and time necessary to develop it ________, most organizations choose to purchase ERP software from a vendor.

A) in-house B) efficiently C) modularized D) organically E) cross-functionally Answer: A Diff: 2 Page Ref: 19 63) An organization must first do a ________ to help narrow down the ERP vendors to a select few.

A) system analysis B) needs assessment C) vendor review D) performance review Answer: B Diff: 3 Page Ref: 19 64) ________ is the time from "go live" to about 90 days after, or until the number of issues and problems have been reduced.

A) Implementation B) Rationalization C) Analysis D) Stabilization E) Testing and Debugging Answer: D Diff: 3 Page Ref: 20 9 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

65) One of ERP Systems's goals is to make information flow between ________ and the system.

A) accounting B) finance C) production D) marketing E) all of the above Answer: E Diff: 2 Page Ref: 6 66) In the ERP systems, they must meet the organizational needs in todays's competitive environment to be: A) cross functional, dynamic, and siloed.

B) mono functional, dynamic and global.

C) cross functional, dynamic and global.

D) cross functional, static and global.

E) none of the above Answer: C Diff: 2 Page Ref: 6 67) Business organizations have become ________.

A) more complex B) less complex C) easier to manage D) more layered E) all of the above Answer: A Diff: 1 Page Ref: 4 68) The CEO of a firm probably requires less quantity of information but a very high ________ of information.

A) amount B) quality C) cost D) transfer E) none of the above Answer: B Diff: 2 Page Ref: 6 69) As organizations grew they tended to create a hodge-podge of siloed information systems that lacked ________.

A) analysis B) modularity C) diversity D) integration E) none of the above Answer: D Diff: 1 Page Ref: 6 10 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

70) A(n) ________ system is an integrated information system that supports all the functions of the enterprise in real-time.

A) Silo B) ERP C) Decentralized D) Management E) none of the above Answer: B Diff: 1 Page Ref: 7 71) An ERP system works on a(n) ________ database that allows various departments to share information and communicate with each other.

A) silo B) ERP C) single D) archive E) none of the above Answer: C Diff: 2 Page Ref: 9 72) As opposed to ERP systems, e-Business systems are focused more on integrating ________ processes.

A) external B) hardware C) internal D) software E) none of the above Answer: A Diff: 2 Page Ref: 17 73) One benefit of ERP systems is that by having standard user interfaces, less ________ of employees is required.

A) numbers B) management C) quality D) training E) none of the above Answer: D Diff: 2 Page Ref: 17

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74) It is not uncommon for employees to ________ the changes in their roles and department boundaries due to the new ERP system.

A) embrace B) resist C) request D) sabotage E) none of the above Answer: B Diff: 2 Page Ref: 18 75) Making modifications to the ERP software will ________ the investment in the system and introduce higher implementation risk.

A) increase B) decrease C) simplify D) reinforce E) none of the above Answer: A Diff: 2 Page Ref: 20 76) List and briefly describe three different benefits of an ERP system.

Answer: There are many potential benefits related to integrating all of an organization's systems in one standard package. First, the overall cost of running the systems should decrease if the ERP system is installed properly. Secondly, there should be new efficiencies discovered in the ability to share data across departmental boundaries in real-time. This data should also be more timely and accurate than before and therefore should help users make better decisions. Standardizing all the processes in the organization should also make it easier to make changes in the future and to train users.

Diff: 2 Page Ref: 29 77) List and briefly discuss three problems with ERP systems.

Answer: Well, one major problem is with the high cost of implementing an ERP system. Not only are they expensive to install, but they are expensive to maintain with all of the frequent upgrades. They are also extremely complex since they attempt to integrate all the processes across the entire organization which could entail globalization complexities too. It is often the case that end users do not like these systems since they entail many changes to their job descriptions, organizational structure, and may even have more awkward interfaces than their previous, custom-made internal applications.

Diff: 2 Page Ref: 29

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78) What are the risks and benefits of making modifications to a purchased ERP package?

Answer: One possible benefit of making modifications to a purchased ERP package is that users will find it more usable and thus it might be a bigger success. The modifications might also give the organization a competitive advantage over the competition. However, making modifications can be quite costly and each of the modifications will have to be maintained every time the software vendor releases upgrades to the software that must be installed. These releases can come as often as every six months and can disrupt the functioning of the system. This is why most companies will choose to make as few modifications to the software as possible.

Diff: 3 Page Ref: 19 79) What are the main steps in a typical ERP implementation methodology?

Answer: Every ERP software vendor and consulting firm boasts of having their own implementation methodologies. But they all basically follow the same pattern. This can be viewed in terms of five separate phases: Requirements Gathering/Gap Analysis, System Design, Building and Testing, Implementation, and Stabilization and Support. Throughout all these phases change management processes should also be in place.

Diff: 2 Page Ref: 20 80) What criteria should be used when selecting an ERP software vendor?

Answer: An organization must carefully consider their current and future needs across the entire enterprise. In the beginning, this may just involve estimating the number of users who will be accessing the enterprise applications. Depending on the particular industry, some ERP vendors may have developed better industry "best practices" that will fit with the organization's business needs better. This assessment should look at the functionality that is needed and make sure the vendors can meet these needs. Once the list is down to 3 or 4 vendors, they should be invited to submit detailed proposals. Part of this process will involve the vendors installing their software on a company server or "sandbox" where some users can be invited to test out the software.

Other criteria for considering the software should involve the quality of support and the procedure for installing upgrades and obtaining licenses. There should also be a sizeable pool of IT labor available at a reasonable price in order to maintain it after implementation.

Diff: 3 Page Ref: 21 81) What is the go live phase of an ERP project? How does an organization prepare for this critical phase?

Answer: The go live phase is when the new ERP system is first "turned on" or released to the organization. This is one of the most critical phases in the ERP project because many ERP implementations have turned into disasters during or after the go live stage. Immediately after the go live the systems must stabilize in terms of the number of issues and problems resulting from the new system. To get ready for this, the organization adequately trains end users and has Help Desks in place. They must set up an Audit Support group to make sure that the data in the new system is not compromised and have procedures in place to correct problems with data as users discover them.

Diff: 3 Page Ref: 22

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82) What is the Capability Maturity Model and how does it help gauge a company's readiness for an ERP implementation?

Answer: The CM model is one way that organizations can measure how well prepared they are for implementing complex systems such as ERP. Their IT capabilities are rated on a scale of 1-5 where one is the lowest and 5 is the highest. Organizations with a low rating will need to hire outside consultants in order to gain the expertise needed for an ERP project, and they may not want to make too many modifications to the purchased ERP package.

Diff: 3 Page Ref: 21 83) What is meant by "change management" and why is it important for ERP projects?

Answer: Because an ERP system may involve considerable changes to an organization's processes and structure, it is crucial to actively manage how the changes are implemented in the organization. Research has shown that many projects fail because of poor change management.

Much of change management involves communicating clearly to employees and training them on what their new job descriptions will involve.

Diff: 2 Page Ref: 23 84) List and briefly describe three trends for ERP systems in the near future.

Answer: One important trend is how ERP systems are being extended by the Internet to better support e-Business. ERP systems are also beginning to integrate more and more open-source software. Flexible new platforms such as SOA are being designed for ERP systems to make it easier to develop integrated web services. These trends are also making it easier for ERP vendors to extend their software into the smaller and medium-sized organizations.

Diff: 2 Page Ref: 23-24 85) What are the most important issues that organizations should consider when implementing an ERP system?

Answer: Because ERP systems are so complex, it is important to manage risk and to be able to learn from both successes and failures. This means that objectives of the project need to be clearly communicated throughout the organization and a clear focus maintained. Managers must continuously evaluate the project status and be flexible enough to take advantage of the capabilities of the ERP system. To be a success, they must also be skillful at managing organizational change. To maintain a competitive advantage, managers must also learn how to integrate their ERP system with the Internet and across the global organization.

Diff: 2 Page Ref: 28-29

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 2 Systems Integration 1) When data has to be manually re-entered from one system into another system, this indicates that the systems have seamless integration.

Answer: FALSE Diff: 2 Page Ref: 37 2) When systems are integrated they can share information in real-time.

Answer: TRUE Diff: 1 Page Ref: 37 3) ERP systems allow organizations to integrate heterogeneous systems into one with an integrated database system.

Answer: TRUE Diff: 2 Page Ref: 38 4) Until recently, information systems and organizations have evolved into functional silos.

Answer: TRUE Diff: 2 Page Ref: 38 5) Mid-level managers typically focus on planning the long-term strategy of the organization.

Answer: FALSE Diff: 1 Page Ref: 39 6) The current classification of organizations into departments like Accounting and Human Resources shows how the organizational structure evolved by breaking complex tasks into smaller, manageable tasks.

Answer: TRUE Diff: 2 Page Ref: 39 7) Organizations have horizontal and vertical divisions.

Answer: TRUE Diff: 1 Page Ref: 39 8) When organizations get large and complex they tend to break functions into larger units and assign one or more staff the responsibility for these activities.

Answer: FALSE Diff: 2 Page Ref: 40 9) When organizations get large and complex sharing of information happens only at higher levels of management.

Answer: TRUE Diff: 2 Page Ref: 40

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10) The functional silo problem gave birth to BPR. Answer: TRUE Diff: 3 Page Ref: 40 11) The business process view flattens the organization structure from a matrix to a hierarchical structure.

Answer: FALSE Diff: 3 Page Ref: 41 12) Information systems that work independently and are grouped by the various functions and/or departments are known as silos.

Answer: TRUE Diff: 2 Page Ref: 42 13) Independent information systems are good for sharing data between users.

Answer: FALSE Diff: 1 Page Ref: 43 14) Functional silos deliver value through their cross-functional performance but are evaluated for their functional performance.

Answer: TRUE Diff: 3 Page Ref: 43 15) Silo environments help to foster enterprise decision-making and overall effectiveness.

Answer: FALSE Diff: 2 Page Ref: 43 16) The functional model of POSDCORB (Planning, Organizing, Staffing, Directing, Coordinating, Reporting, Budgeting) dates back to the 1930s yet is still in use today.

Answer: TRUE Diff: 1 Page Ref: 38 17) The distributed system architecture has been commonly used in organizations for quite some time.

Answer: TRUE Diff: 2 Page Ref: 44 18) The first generation of computer architecture was the decentralized approach.

Answer: FALSE Diff: 2 Page Ref: 44 19) In a decentralized computer architecture, every user is given a personal computer.

Answer: TRUE Diff: 2 Page Ref: 44

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20) A centralized computer architecture is based on using servers to share data and applications.

Answer: FALSE Diff: 2 Page Ref: 44 21) A distributed architecture is good for ERP systems because they are flexible and scalable.

Answer: TRUE Diff: 2 Page Ref: 44 22) The manufacturing area has basically the same information needs and reporting requirements as the marketing area.

Answer: FALSE Diff: 2 Page Ref: 44 23) Transaction processing systems are designed to support office workers.

Answer: FALSE Diff: 2 Page Ref: 45 24) Decision support systems take data from the TPSs in the organization to help managers make better decisions.

Answer: TRUE Diff: 3 Page Ref: 45 25) Expert systems are a type of Executive Support System to support top-level executives.

Answer: FALSE Diff: 2 Page Ref: 45 26) Silos will probably not prevent customer service representatives from accessing customer data payment records in real-time.

Answer: FALSE Diff: 2 Page Ref: 38 27) Systems integration can't help employees at a lower levels make better decisions and feel more empowered and productive.

Answer: FALSE Diff: 3 Page Ref: 38 28) The people issues are the most challenging in systems integration.

Answer: TRUE Diff: 3 Page Ref: 38 29) Functional department heads will probably lose control of the data they produce in an integrated system.

Answer: TRUE Diff: 3 Page Ref: 39

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30) Getting employee buy-in on a systems integration project is very critical for the success of the integrated system.

Answer: TRUE Diff: 2 Page Ref: 39 31) One consequence of making information more easily shared will be that integrated systems won't make it easier to get illegal access to the data.

Answer: FALSE Diff: 2 Page Ref: 41 32) CEOs and Presidents are involved in planning the long-term strategy of the organization.

Answer: TRUE Diff: 1 Page Ref: 37 33) Lower-level managers rarely focus on the day-to-day operations of the organization.

Answer: FALSE Diff: 1 Page Ref: 38 34) A cross-functional task such as order processing involves interactions between sales, warehousing and accounting.

Answer: TRUE Diff: 2 Page Ref: 40 35) Heterogeneous or independent non-integrated systems create bottlenecks, interfere with productivity, and breed inaccurate data.

Answer: TRUE Diff: 2 Page Ref: 41 36) The three major types of information system architectures include centralized, decentralized and distributed systems architectures.

Answer: TRUE Diff: 2 Page Ref: 44 37) Today's information systems are based on a centralized architecture that allows sharing of applications and data resources between the end user and the server computers.

Answer: FALSE Diff: 3 Page Ref: 44 38) The distributed system architecture is very complex requiring careful planning and design.

Answer: TRUE Diff: 1 Page Ref: 45 39) Information systems support the major functional areas of a business including manufacturing, finance, accounting, human resources, and marketing.

Answer: TRUE Diff: 1 Page Ref: 45 4 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

40) Operating systems and databases are examples of systems that support the end-users directly.

Answer: FALSE Diff: 2 Page Ref: 46 41) A(n) ________ provides a visual dashboard of strategic information to top-level management in real time.

A) DSS B) TPS C) ESS D) OAS Answer: C Diff: 2 Page Ref: 45 42) Information systems that are used for generating reports for mid-level managers are known as: A) ESS. B) DSS. C) databases.

D) MIS. Answer: D Diff: 2 Page Ref: 45 43) Systems integration means allowing access to a shared data resource by people from different ________ areas of the organization.

A) functional B) geographical C) decisional D) logical Answer: A Diff: 2 Page Ref: 46 44) At the physical level, systems integration means providing seamless connectivity between ________ systems.

A) software B) functional C) distributed D) heterogeneous Answer: D Diff: 2 Page Ref: 46

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45) Business ________ reengineering involves changing the mindset of employees to do their tasks in a new way.

A) software B) system C) process D) task E) function Answer: C Diff: 2 Page Ref: 46 46) To get employees to do their task in a new way, managers must get them to shift their focus from achieving ________ goals to organizational goals.

A) procedural B) departmental C) functional D) individual E) practical Answer: B Diff: 2 Page Ref: 46 47) One step in the systems integration process is to develop a policy on whether older, ________ systems will be supported and maintained.

A) business B) functional C) departmental D) legacy Answer: D Diff: 3 Page Ref: 47 48) To avoid support and maintenance problems with the integrated system it is important to create a ________ IT help desk and support.

A) strategic B) business C) centralized D) network E) distributed Answer: C Diff: 3 Page Ref: 47

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49) If there is a system failure or a major disaster it is crucial that a good ________ system for the integrated system be in place.

A) hardware B) backup and recovery C) database D) crisis management E) electrical Answer: B Diff: 2 Page Ref: 47 50) The first step in systems integration is to take inventory of the various IT ________ being used in the organization.

A) resources B) databases C) hardware components D) integrated systems E) web-enabled applications Answer: A Diff: 2 Page Ref: 47 51) ________ tools are good for short-term integration of existing applications in the organization.

A) Hardware B) Data integration C) Real-time access D) Business process integration E) Middleware Answer: E Diff: 3 Page Ref: 46 52) In general, the biggest benefits of implementing an integrated system include a reduction in inventory and ________ costs.

A) personnel B) direct C) material D) silo E) indirect Answer: A Diff: 3 Page Ref: 48

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53) Being able to approve a customer's credit application on the spot is an example of how integrated systems can provide better: A) resources.

B) market research.

C) information visibility.

D) support.

Answer: C Diff: 3 Page Ref: 49 54) A side benefit of integration is that the organization is forced to ________ its hardware, software, and IT policies.

A) review B) reengineer C) upgrade D) standardize Answer: D Diff: 2 Page Ref: 48 55) Because of the high initial setup costs for the integrated system, it is particularly crucial to have a strong commitment from: A) the consultants.

B) the IT staff.

C) top management.

D) the employees.

Answer: C Diff: 2 Page Ref: 49 56) Because systems integration often involves sharing information across departments, this often creates ________ among the functional departments.

A) power conflicts B) new opportunities C) network failures D) better decisions Answer: A Diff: 2 Page Ref: 49 57) Many benefits of integrated systems are ________ so they are difficult to quantify.

A) financial B) operational C) intangible D) decisional E) tangible Answer: C Diff: 2 Page Ref: 48

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58) ERP systems are integrated, multi-module ________ software packages.

A) network B) web-service C) database D) application E) platform Answer: D Diff: 2 Page Ref: 48 59) At the ________ level, ERP systems require organizations to focus on business processes rather than functions.

A) presentation B) logical C) middleware D) physical E) hardware Answer: B Diff: 3 Page Ref: 49 60) ERP systems come with built-in ________ for a variety of functions such as entering a customer order.

A) tasks B) vendors C) processes D) users E) roles Answer: C Diff: 2 Page Ref: 50 61) Because of an ERP system, customers should be able to find out ________ the current status of their orders.

A) eventually B) on the web C) in real-time D) quickly Answer: C Diff: 2 Page Ref: 50 62) Hershey's ERP project failed initially because they failed to break their existing: A) chocolate bars.

B) functional silos.

C) cross-functional roles.

D) hardware resources.

E) software development patterns.

Answer: B Diff: 3 Page Ref: 50 9 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

63) The current generation of ERP systems does not work well with ________ architecture on legacy platforms.

A) in-house B) distributed C) grid D) centralized E) cross-platform Answer: D Diff: 3 Page Ref: 51 64) An organization that wants to connect its systems with its partners and suppliers needs to have a robust ________ system in place.

A) supply chain B) ERP C) DSS D) TPS Answer: B Diff: 3 Page Ref: 51 65) One benefit of ERP systems is that they allow organizations to quickly form and break ________ with other companies.

A) networks B) web services C) protocols D) alliances Answer: D Diff: 3 Page Ref: 51 66) Integrated systems should ________ share information with one another.

A) never B) slowly C) rarely D) seamlessly Answer: D Diff: 1 Page Ref: 37 67) Manually reentering data in a system ________ leads to more errors and inaccuracies.

A) rarely B) usually C) always D) never Answer: B Diff: 1 Page Ref: 37

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68) Early business organizations focused on breaking complex work tasks into ________ tasks that could be more easily managed and controlled.

A) larger B) more complex C) smaller D) non-working Answer: C Diff: 2 Page Ref: 37 69) The hierarchical layers of an organization from strategic planning to operational control represent ________ silos.

A) horizontal B) matrix C) corn D) vertical Answer: D Diff: 1 Page Ref: 39 70) As organizations get more ________ and more virtual, information sharing and communication problems get worse.

A) centralized B) geographically dispersed C) automated D) integrated Answer: B Diff: 2 Page Ref: 40 71) The business process view flattens the organization from a hierarchical to a ________ structure.

A) vertical B) relational C) matrix D) horizontal Answer: C Diff: 3 Page Ref: 40 72) A(n) ________ organization focuses all its business processes around improving its relationship with its customers.

A) sales oriented B) non-profit C) vertical D) customer-centric Answer: D Diff: 2 Page Ref: 41

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73) ________ systems focus on individual tasks and/or functions rather than on a process and supporting team collaboration.

A) Matrix B) Vertical C) Hierarchical D) Silo Answer: D Diff: 2 Page Ref: 42 74) In silo systems information is captured and re-entered several times and is not available in ________.

A) batches B) real-time C) back-ups D) hardcopy Answer: B Diff: 2 Page Ref: 42 75) The evolution of Information Systems is often viewed as a(n) ________ change process in which technologies, human factors, organizational relationships and tasks change continuously.

A) easy B) automated C) simplified D) socio-technical Answer: D Diff: 3 Page Ref: 44 76) How have organizations evolved into vertical silos over the years? What impact does this have on information sharing?

Answer: Since the late 1960s, researchers found that organizations divided up responsibility in hierarchical layers. These layers were associated with strategic planning, management control, and operational control. These layers in the organization helped to define the business roles at each level; i.e. CEOs focused on strategic planning, managers focused on management control, and line-level people were involved in day-to-day operations. With respect to information sharing and systems, each layer has different information and reporting needs, so they typically had totally separate systems to support their individual needs. These systems were not oriented towards sharing information up and down the vertical silo or hierarchy.

Diff: 2 Page Ref: 38

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77) How have organizations evolved into horizontal silos over the years? What impact does this have on information sharing?

Answer: The idea of breaking up the business into horizontal silos goes back to the early 1900s.

This was when a researcher first divided up a business into five basic areas; planning, organizing, coordinating, commanding and controlling. This later evolved into the functional areas or departments that we use today; i.e. Accounting, HR, Marketing, Finance, and Management. This way tasks could be broken down into smaller, more manageable tasks and assigned to specific people who would be held responsible for them. However, this focus on smaller tasks and individuals led to the development of specific information systems to support them. These systems were not designed with sharing in mind since the organization as a whole was not as concerned with this. So sharing information was especially difficult since there was little support for the "process view" of the organization.

Diff: 3 Page Ref: 37 78) List and describe at least three different limitations of systems integration.

Answer: One obvious limitation of these systems is that they have a very high cost of implementation for the hardware, software and labor involved. These systems can also lead to major conflicts among the leaders of the various functional departments, since they know that by openly sharing their data they may be giving up some of their own individual power. These systems are often criticized for limiting the creativity of the individual departments which can also lead to important innovations. By forcing everyone to use the same system and procedures this may impact future innovations. Also, making the financial case for these systems can be difficult since so many of the benefits are intangible and also because other benefits may not show for several years out.

Diff: 3 Page Ref: 49 79) How does changing from a functional view to a process view of the business impact the structure of the organization?

Answer: The idea of using the business process, such as order processing, as an alternative way of grouping people and resources can have a large impact on the structure of the organization.

First, people are evaluated on a new set of process metrics as opposed to the old view of measuring employees solely on the performance of their functional area. The business process view also leads to a flattening out of the organizational structure from a hierarchical to a more of a matrix structure. This is because decisions and information are pushed down the hierarchy and resources to some extent too.

Diff: 3 Page Ref: 40

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80) Describe three different limitations of integrating systems.

Answer: The initial implementation of integrated systems is high in terms of both hardware and software costs and human costs due to the re-engineering of business processes. Systems integration often involves sharing of information across department and interdepartmental teams.

This often creates power conflicts among the functional departments if they have not bought into the integration. The return on investments (ROI) from systems integration often do not show up until several years after the implementation, and many of these returns come in intangible form and are therefore not recognized on the bottom line of the organization. One last limitation that often occurs with integrated systems is that it restricts creativity and independence in the functional areas since they must now work together in a standardized format.

Diff: 2 Page Ref: 48 81) List and describe the three main information system architectures.

Answer: An information system architecture is important because it describes how computing resources will be accessed and shared throughout the organization. This is especially important for the design of the integrated information systems. Originally, users had to connect to a mainframe computer with a variety of terminals in what was a very centralized IS architecture.

With the advent of personal computers on everyone's desktop, computing became very decentralized since they had limited connections to other computers. Eventually, these personal computers were all linked up together in Client/Server networks in what is now known as a distributed IS architecture. This current model provides huge improvements in speed, power and access to data and applications, and does so for lower costs.

Diff: 2 Page Ref: 44 82) What is a distributed architecture? Why is it used so much for integrated systems such as ERP? Answer: The current systems being developed are based on the distributed architecture. This architecture depends on complex networks of client machines and servers linked up over a variety of networks. It combines features of both the centralized and decentralized architectures in that each user has a powerful machine and local resources, but can also access a wider variety of powerful applications and data stored on the more powerful servers on the network. This kind of architecture was crucial to the development of integrated systems such as ERP because they helped link up users in different functional areas and gave them better access to common data and applications. They were also cheaper and more scalable so more servers could be added to the system as needed.

Diff: 3 Page Ref: 44

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83) Briefly describe three different levels in an organization and the different categories of information systems that support them.

Answer: At the bottom of the organizational hierarchy are all the operating systems and database applications which the IT staff have to use in order to do their jobs. Line managers and operations staff also have to have access to Transaction Processing Systems which every organization needs to record transactions such as sales orders and purchase orders. At the highest level of the organization, executives use Executive Support Systems to get a graphical view of how the organization is performing. Other important systems include Office Automation Systems for clerical staff, Management Information Systems for mid-level managers, and Decision Support Systems which are designed for Knowledge Workers.

Diff: 3 Page Ref: 40 84) What is the difference between logical and physical systems integration? Give an example of each.

Answer: Logical integration refers to how users get access to data across functional areas. For example, sales people need to get approval for customer credit from the credit managers in the finance department so this would be logical integration in the order processing process.

Underneath the logical integration, the required applications and databases need to be connected physically. For example, customer data in a mainframe system may have to be linked up with credit management applications running on a Client/Server network. This would be an example of physical systems integration.

Diff: 3 Page Ref: 46 85) Describe three different benefits of integrating systems.

Answer: One of the biggest benefits is that integrated systems allow the organization to reduce its inventory and cut personnel costs. These systems will also help smaller companies provide a level of customer service that is equal to that provided by larger companies so they will be able to compete better. Getting better and more timely information should also help both managers and employees make better decisions. Also, by standardizing hardware, software and IT policies the company will save money in the long run.

Diff: 2 Page Ref: 48

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 3 Enterprise Systems Architecture 1) Implementing a new ERP system is mainly a question of installing ERP software.

Answer: FALSE Diff: 2 Page Ref: 59 2) The hard part of installing an ERP system is changing the business processes of the people who will use the system.

Answer: TRUE Diff: 2 Page Ref: 59 3) An ERP system architecture should adapt to future business challenges.

Answer: TRUE Diff: 1 Page Ref: 59 4) ERP systems need both current and historical data.

Answer: TRUE Diff: 2 Page Ref: 59 5) Understanding the enterprise architecture is helpful because it helps everyone understand the various components of the enterprise system better.

Answer: TRUE Diff: 1 Page Ref: 59 6) The functional view of the enterprise system architecture defines the physical components of the system.

Answer: FALSE Diff: 3 Page Ref: 60 7) The databases used are components of the ERP system architecture.

Answer: TRUE Diff: 3 Page Ref: 60 8) Organizations rarely selectively implement different ERP modules.

Answer: FALSE Diff: 3 Page Ref: 60 9) ERP software provides business functionality for everything except human resources.

Answer: FALSE Diff: 2 Page Ref: 61 10) In ERP software, the procurement module includes the best practices on purchasing.

Answer: TRUE Diff: 2 Page Ref: 61

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11) Logistics is an example of a typical ERP module.

Answer: TRUE Diff: 2 Page Ref: 61 12) Marketing automation is an example of a typical ERP module.

Answer: FALSE Diff: 3 Page Ref: 61 13) Production modules have evolved from MRP II into ERP systems.

Answer: TRUE Diff: 3 Page Ref: 62 14) ERP vendors generally use the same names for all their different modules.

Answer: FALSE Diff: 1 Page Ref: 62 15) The purchasing module must be tightly integrated with the inventory control and the sales logistics modules.

Answer: FALSE Diff: 3 Page Ref: 62 16) The inventory module helps maintain the appropriate level of stock in a warehouse.

Answer: TRUE Diff: 1 Page Ref: 63 17) Most ERP vendors offer an online storefront as part of the sales module.

Answer: TRUE Diff: 2 Page Ref: 63 18) Sales modules have to be closely integrated with the organization's network module.

Answer: FALSE Diff: 2 Page Ref: 63 19) The HR module is usually the last module implemented by companies.

Answer: FALSE Diff: 3 Page Ref: 63 20) When a new employee is hired and enrolled in the company benefits plan, this would involve using the human resources module.

Answer: TRUE Diff: 2 Page Ref: 63 21) Project management is an example of a non-traditional ERP module now being offered by some vendors.

Answer: TRUE Diff: 3 Page Ref: 64 2 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

22) A performance management module is useful for empowering employees and managers by giving them easy access to all their relevant information.

Answer: FALSE Diff: 3 Page Ref: 64 23) One benefit of using a financial module is that it provides strong support for Sarbanes-Oxley reporting.

Answer: TRUE Diff: 2 Page Ref: 65 24) The procurement and logistics module benefits the organization by helping to reduce transportation costs.

Answer: TRUE Diff: 2 Page Ref: 65 25) In an ERP architecture, hardware layering has had a significant impact on scalability.

Answer: TRUE Diff: 3 Page Ref: 65 26) ERP applications are most commonly deployed in a distributed and often widely dispersed manner.

Answer: TRUE Diff: 2 Page Ref: 65 27) ERP system architectures are organized in layers or tiers to help manage the complexity of the system.

Answer: TRUE Diff: 2 Page Ref: 65 28) Legacy systems and third party applications can be linked to ERP systems through the GUI. Answer: FALSE Diff: 3 Page Ref: 65 29) Middleware provides generic interfaces with which integrated applications pass messages to each other.

Answer: TRUE Diff: 2 Page Ref: 66 30) SAP developed its own platform for systems integration called OASIS. Answer: FALSE Diff: 2 Page Ref: 67 31) A web-based portal allows users to get access to their ERP applications through their browser.

Answer: TRUE Diff: 2 Page Ref: 67 3 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

32) OLAP is the foundation of the business intelligence module in ERP systems.

Answer: TRUE Diff: 2 Page Ref: 71 33) Today's IT infrastructure focuses on integrating the corporate architecture with the GUI and extending it beyond the organization.

Answer: FALSE Diff: 2 Page Ref: 71 34) Three-tier architectures are scalable in that it is easier to add, change and remove applications and hardware.

Answer: TRUE Diff: 2 Page Ref: 73 35) With the addition of the extra tier, the three-tier architecture is considerably less complex than the two-tier architecture.

Answer: FALSE Diff: 1 Page Ref: 73 36) The ERP system ________ determines the relationships between all the complex IT components.

A) network B) layout C) architecture D) middleware Answer: C Diff: 1 Page Ref: 59 37) The IT components of an ERP system architecture include the hardware, software and the: A) security.

B) data.

C) organization.

D) middleware.

Answer: B Diff: 2 Page Ref: 59 38) The enterprise system architecture can be viewed from two different angles; the functional angle and the ________ angle.

A) system B) network C) decisional D) logical Answer: A Diff: 2 Page Ref: 60

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39) ERP vendors break the software up into ________ which organizations can selectively implement to support their different functional areas.

A) programs B) systems C) applications D) modules Answer: D Diff: 2 Page Ref: 60 40) ERP vendors embed their best business ________ in their software to help businesses improve their productivity and performance.

A) decisions B) products C) practices D) tasks E) functions Answer: C Diff: 2 Page Ref: 61 41) If the ERP vendor's software and best practices do not match the organization's needs, it may be necessary to ________ the ERP software.

A) proceduralize B) customize C) compartmentalize D) individualize E) upgrade Answer: B Diff: 2 Page Ref: 61 42) Manufacturing capacity is planned and optimized using the ________ module.

A) purchasing B) sales & marketing C) production D) accounting Answer: C Diff: 2 Page Ref: 62 43) If a company wants to streamline their procurement processes, they would probably choose to implement the ________ module.

A) inventory management B) purchasing C) logistics D) finance E) asset management Answer: B Diff: 3 Page Ref: 62 5 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

44) Order placement and schedule is handled in the ________ module.

A) sales and marketing B) purchasing C) logistics D) finance E) asset management Answer: A Diff: 2 Page Ref: 63 45) Employee data is managed in the ________ module.

A) database B) purchasing C) sales and marketing D) credit management E) human resource Answer: E Diff: 2 Page Ref: 63 46) The core of many ERP systems is the ________ module.

A) sales and marketing B) purchasing C) logistics D) finance E) process management Answer: D Diff: 3 Page Ref: 63 47) The ________ module provides tools and data warehousing capabilities.

A) self-service B) project management C) business intelligence D) database E) asset management Answer: C Diff: 3 Page Ref: 63 48) One benefit of the ________ module is that it helps companies comply with the government rules of the Sarbanes-Oxley Act. A) accounting B) sales and marketing C) production D) finance Answer: D Diff: 3 Page Ref: 64

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49) A ________ module helps customers get more direct access to applications such as tracking the status of their orders.

A) self-service B) project management C) business intelligence D) database E) sales management Answer: A Diff: 3 Page Ref: 63 50) The ________ module uses data collection technologies such as RFID and bar codes to improve resource allocation for cross-docking processes.

A) procurement B) production C) transportation D) sales E) accounting Answer: A Diff: 3 Page Ref: 64 51) The ________ tier acts as the intermediary between the client applications and the database.

A) presentation B) business C) logical D) middleware Answer: B Diff: 3 Page Ref: 65 52) Users input data in the ________ tier.

A) presentation B) business C) logical D) application E) database Answer: A Diff: 2 Page Ref: 65 53) In the ERP system, user ________ are set up to define access right for every user in the portal.

A) security B) web-services C) roles D) application Answer: C Diff: 2 Page Ref: 67

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54) Research shows that large companies lose up to ________ per minute every time their ERP system goes down.

A) $3K B) $3.6M C) $18K D) $13K E) $218K Answer: D Diff: 3 Page Ref: 68 55) A fully functioning ERP system needs a high availability ________ in order to support the growth of the user population and its expansion out to the supply chain partners.

A) database B) application server C) network D) API E) GUI Answer: C Diff: 3 Page Ref: 68 56) Online Analytical Processing is the foundation of the ________ module in ERP. A) e-Commerce B) business intelligence C) performance management D) project management Answer: B Diff: 2 Page Ref: 69 57) In a typical two-tier architecture, the server handles both the ________ and database duties.

A) network B) security C) protocol control D) application E) user access Answer: D Diff: 3 Page Ref: 70 58) In the three-tier architecture, the application, database, and ________ layers are separated into independent operating units.

A) network B) security C) protocol control D) application E) presentation Answer: E Diff: 3 Page Ref: 70 8 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

59) In the newer Web-based architecture, the ________ layer is split into the Web Services tier and the Web Browser tier.

A) network B) security C) database D) application E) presentation Answer: E Diff: 3 Page Ref: 72 60) In ________ environments, clients only need access to the Internet and a standard browser like Internet Explorer with a few plug-ins to interact with ERP applications.

A) server-centric B) web-based C) client-centric D) n-tier client/server Answer: A Diff: 3 Page Ref: 72 61) The term ________ refers to system architectures that can have any number of distinct tiers including 4-tiers and more.

A) frontier B) m-tier C) n-tier D) 4 tier E) none of the above Answer: C Diff: 3 Page Ref: 65 62) The GUI resides on the ________ tier.

A) logical B) presentation C) GUI D) Application E) none of the above Answer: B Diff: 2 Page Ref: 65 63) The ________ tier consists of a web browser and a reporting tool.

A) GUI B) logical C) presentation D) application E) database Answer: D Diff: 3 Page Ref: 66 9 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

64) The global organization that helps to promote the use of a common language is called ________.

A) NCAA B) OASIS C) ICANN D) Netweaver E) none of the above Answer: B Diff: 3 Page Ref: 67 65) The web-based portal is part of the ________ tier.

A) application B) presentation C) GUI D) Application E) none of the above Answer: B Diff: 2 Page Ref: 67 66) In the ERP system, user ________ are set up to define the access rights for each and every functional user of the system.

A) accounts B) GUIs C) applications D) roles E) none of the above Answer: D Diff: 2 Page Ref: 67 67) Many ERP implementations fail to realize all the benefits because they don't provide the system with enough network ________.

A) bandwidth B) traffic C) software D) hardware E) none of the above Answer: A Diff: 3 Page Ref: 68

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68) Because of the tremendous load that an ERP system places on the corporate LAN and WAN, it is crucial that companies go through network ________, when deploying an ERP system.

A) implementations B) upgrades C) downtime D) capacity planning E) none of the above Answer: D Diff: 3 Page Ref: 68 69) Third party system integration can be done in either the portal or the ________ layer.

A) presentation B) logical C) GUI D) application E) none of the above Answer: D Diff: 3 Page Ref: 70 70) The IT infrastructure in organizations has moved from centralized to client-server and ________.

A) distributed B) recentralized C) siloed D) unmanageable E) none of the above Answer: A Diff: 2 Page Ref: 71 71) The first generation of the distributed IT architecture involved ________ tiers.

A) one B) two C) three D) n E) none of the above Answer: B Diff: 2 Page Ref: 71 72) A drawback of the two-tier ERP architecture is that it requires expensive ________ for integrating other systems.

A) middleware B) 1 tier systems C) 3 tier systems D) n-tier systems E) none of the above Answer: A Diff: 3 Page Ref: 71 11 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

73) The GUI resides on the ________ layer of the three-tier system architecture.

A) logical B) presentation C) GUI D) application E) none of the above Answer: B Diff: 2 Page Ref: 72 74) The ________ client/server architecture has been shown to improve performance for groups with a large number of users.

A) one-tier B) two-tier C) three-tier D) four-tier E) none of the above Answer: C Diff: 3 Page Ref: 73 75) The next generation web-based architectures will help to deliver ________ access to ERP systems.

A) limited B) centralized C) short term D) ubiquitous E) none of the above Answer: D Diff: 2 Page Ref: 74 76) What are the typical modules available in an ERP system?

Answer: While the names of the modules may vary between ERP vendors, the main modules are: MRP, Sales and Marketing, Purchasing, Accounting, Finance, Human Resources, and production. These modules, along with some other miscellaneous modules, are designed to support all the functional areas in an organization.

Diff: 2 Page Ref: 60 77) Describe one potential benefit related to each of the main ERP modules.

Answer: The main modules in an ERP system go by different names with each of the main ERP vendors. In general, the Financial module helps to automate both the financial and managerial accounting tasks along the financial supply chain. Procurement and logistics modules reduce the supply chain costs by automating the supply chain processes. Sales and service modules help increase sales by increasing customer satisfaction. The Product Development and Manufacturing modules help to shorten the time to bring new products to market. Performance management modules help managers keep track of key performance statistics. Some companies also implement self-service modules to help employees and managers get access to pertinent information.

Diff: 2 Page Ref: 63 12 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

78) List and describe the three different layers of a traditional ERP architecture.

Answer: Traditionally, ERP architectures have been designed and developed with three layers or "tiers" in mind. The first layer is called the "data tier" and is responsible for managing the system data. The second layer is the "business tier" which is where the ERP software modules reside. The final layer is the "presentation tier" which is where the GUI or the interface resides.

Diff: 2 Page Ref: 66 79) What resides on the application tier of an ERP architecture? Give an example from a real system of what resides on the application tier.

Answer: The most important part of the application tier is that it is where the actual ERP applications reside. This also means that this is where the middleware and API tools reside in order to connect this layer or server to any legacy systems that must be integrated into the ERP system and any relational databases that will supply the data. This layer also makes use of a report writer and a Java interface layer to help connect it to the client.

Diff: 3 Page Ref: 67 80) Why are infrastructure considerations so important when implementing an ERP system?

Answer: With respect to ERP infrastructure, considerations such as network speed, availability and bandwidth are very important since more and more users will be logging onto the ERP system via a combination of different networks. This places a heavy burden on the networks as the number of users grows. And because they are doing more and more critical functions with their ERP systems on the networks, any time the systems go down means that the company will lose, on average, $13K/minute of downtime. This is a lot of money.

Diff: 2 Page Ref: 68 81) Why is the decision about which architecture to use when implementing an ERP system so important and complex?

Answer: An information system architecture is important because it describes how computing resources will be accessed and shared throughout the organization. This is especially important for the design of the integrated information systems. Originally, users had to connect to a mainframe computer with a variety of terminals in what was a very centralized IS architecture.

With the advent of personal computers on everyone's desktop, computing became very decentralized since they had limited connections to other computers. Eventually, these personal computers were all linked up together in Client/Server networks in what is now known as a distributed IS architecture. This current model provides huge improvements in speed, power and access to data and applications, and does so for lower costs.

Diff: 2 Page Ref: 81 82) Briefly describe three different drawbacks of using an SOA for an ERP implementation.

Answer: Because SOAs are so new there are a number of different drawbacks in using them for ERP systems. First, they may be difficult to totally debug and their performance may be inconsistent. It also makes security considerations and maintenance more complex; especially since some of the services used will be coming from third party vendors and/or partners. In order to be successful it also requires that senior people at the enterprise level have to support the implementation. Initial costs are also high as the services need to be revised frequently.

Diff: 3 Page Ref: 76 13 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

83) Briefly describe three different benefits of using an SOA for an ERP implementation.

Answer: Potential SOA benefits can be classed as short-term, long-term and overall business value contributions. In the short-term, SOA can be used to link up incompatible technologies.

In the longer term, it provides a platform for creating innovative composite applications which can generate real competitive advantages in the industry. Overall, an SOA should make the business much more agile in responding to a wide variety of changes in the business environment.

Diff: 3 Page Ref: 76 84) What is a Service Oriented Architecture? How is this being used to implement ERP systems?

Answer: SOA refers to a software development model that is based on a contract between a consumer and a provider of services. From an ERP perspective, SOA decomposes the business logic into smaller, distinct units of services. An example of a service might be a print routine, or a service to calculate the tax on a purchase. When deployed on the Web these can also be considered to be Web services. The difficult question with ERP systems is that each service must be integrated with all the other, related services to provide seamless support for users.

Diff: 3 Page Ref: 76 85) What is a Web-based Architecture? What impact will it have on ERP systems?

Answer: The Web is sometimes referred to as the "fourth tier" of the three-tier ERP architecture.

As ERP vendors raced to link their systems with the Web, they broke the presentation tier into a Web Services tier and a Web Browser tier. This allows ERP systems to connect to the Internet to provide powerful new functionality for Internet-based access and integration. This helps provide ubiquitous access to all the powerful ERP modules and data using technology that is commonly known and used by users.

Diff: 2 Page Ref: 73

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 4 Development Life Cycle 1) ERP system development projects are not very complex so they don't need a structured development process.

Answer: FALSE Diff: 2 Page Ref: 90 2) The process of developing new information systems is called the SDLC. Answer: TRUE Diff: 1 Page Ref: 90 3) The systems approach to problem solving breaks complex problems up into more manageable, smaller problems.

Answer: TRUE Diff: 1 Page Ref: 91 4) The SDLC process involves high-level problems and so doesn't require technical problem solving skills.

Answer: FALSE Diff: 3 Page Ref: 91 5) The main reason for the early system development failures was a lack of clear leadership.

Answer: FALSE Diff: 2 Page Ref: 91 6) The traditional SDLC methodology breaks system development into six different phases.

Answer: FALSE Diff: 1 Page Ref: 91 7) The SDLC process actually begins when someone in the organization identifies a need for a new system.

Answer: TRUE Diff: 2 Page Ref: 92 8) Economic feasibility addresses whether the problem can be solved with the current generation of information technology.

Answer: FALSE Diff: 2 Page Ref: 92 9) The cost/benefits of a system that can be quantified are called intangible.

Answer: FALSE Diff: 2 Page Ref: 92 10) The investigation phase should be conducted by the IT department.

Answer: TRUE Diff: 2 Page Ref: 92 1 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

11) At the end of the investigation phase, a report is prepared for management and stakeholders.

Answer: TRUE Diff: 1 Page Ref: 92 12) In the analysis phase, the development team should consist of just consultants and technical specialists.

Answer: FALSE Diff: 3 Page Ref: 92 13) In the analysis phase, the development team should focus on finding all the bottlenecks and constraints of the existing system.

Answer: TRUE Diff: 3 Page Ref: 92 14) In the design phase the technical requirements from the analysis phase have to be converted into network infrastructure designs.

Answer: FALSE Diff: 3 Page Ref: 92 15) The implementation phase begins with defining the user requirements.

Answer: FALSE Diff: 2 Page Ref: 92 16) The SDLC would not be appropriate for designing a new web page.

Answer: TRUE Diff: 2 Page Ref: 92 17) Prototyping is an example of a rapid development approach.

Answer: TRUE Diff: 1 Page Ref: 93 18) In ERP implementations, many companies install a toolbox system to expose users to the system functionality.

Answer: FALSE Diff: 2 Page Ref: 93 19) In the prototyping approach, end users create their own applications.

Answer: FALSE Diff: 2 Page Ref: 93 20) End-user development became popular with the advent of personal computers in the 1980s.

Answer: TRUE Diff: 2 Page Ref: 93 21) EUD is applicable to ERP systems for designing the underlying database applications.

Answer: FALSE Diff: 3 Page Ref: 93 2 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

22) Since ERP systems use packaged software, they are very similar to PC-based software packages like Microsoft Office.

Answer: FALSE Diff: 2 Page Ref: 93 23) In the 1990s Hershey Corp. lost millions of dollars when their supply chain distribution systems were disrupted by their ERP implementation during their holiday sales period.

Answer: TRUE Diff: 3 Page Ref: 94 24) An ERP Implementation plan is used to create a roadmap for the implementation.

Answer: TRUE Diff: 1 Page Ref: 94 25) Like SDLC, the ERP development life cycle provides a systematic approach to implementing ERP software.

Answer: TRUE Diff: 2 Page Ref: 95 26) ASAP, and FastTrack are examples of vendor driven ERP development methodologies.

Answer: TRUE Diff: 2 Page Ref: 101-2 27) The ERP life cycle expands at a much faster pace than in the traditional SDLC. Answer: FALSE Diff: 3 Page Ref: 96 28) The feasibility study is conducted in the scope and commitment stage of the ERP life cycle.

Answer: TRUE Diff: 3 Page Ref: 96 29) Preliminary training of the users with a sandbox is done in stage three of the ERP life cycle.

Answer: TRUE Diff: 3 Page Ref: 96 30) During the Acquisition and Development stage of the ERP life cycle, the data team works on multiplying data from the old system to the new one.

Answer: FALSE Diff: 3 Page Ref: 96 31) System handover, or knowledge transfer is the major activity of the operation stage of the ERP life cycle.

Answer: FALSE Diff: 3 Page Ref: 97

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32) Consultants play an important role in the slow implementation of ERP systems.

Answer: FALSE Diff: 2 Page Ref: 98 33) The use of rapid implementation methodologies for ERP implementations has drastically decreased.

Answer: FALSE Diff: 2 Page Ref: 99 34) Deloitte & Touche developed an ERP implementation methodology called RAD. Answer: FALSE Diff: 2 Page Ref: 100 35) The value proposition helps to ensure that the ERP solution being considered makes sound business sense.

Answer: TRUE Diff: 2 Page Ref: 99 36) SAP's rapid implementation methodology is called ASAP. Answer: TRUE Diff: 2 Page Ref: 101 37) The ASAP methodology makes use of predefined business tiers.

Answer: FALSE Diff: 3 Page Ref: 101 38) The BIM methodology for ERP implementations was developed by Accenture in the 1990s.

Answer: TRUE Diff: 2 Page Ref: 102 39) The BIM methodology is best suited for full life cycle ERP projects involving some custombuilt solutions.

Answer: TRUE Diff: 3 Page Ref: 102 40) ERP packages are complex software packages with embedded business processes.

Answer: TRUE Diff: 2 Page Ref: 103 41) An example of a deliverable that would be due at the end of each stage of the traditional ERP life cycle would be a(n): A) application.

B) database.

C) report.

D) project.

Answer: C Diff: 2 Page Ref: 95 4 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

42) The ERP life cycle is often just as rigorous as the traditional ________ life cycle.

A) network B) project C) BIM D) SDLC Answer: D Diff: 2 Page Ref: 102 43) The ________ provide knowledge to embed business rules and input for interface and report design.

A) SMEs B) IT gurus C) managers D) decision makers Answer: A Diff: 3 Page Ref: 95 44) In the ERP life cycle, one of the key early decisions is the ________ selection.

A) programs B) systems C) vendor D) network Answer: C Diff: 2 Page Ref: 100 45) Compared with the traditional SDLC, the ERP life cycle is more focused on reengineering organizational ________ and change management.

A) decisions B) products C) practices D) processes E) functions Answer: D Diff: 2 Page Ref: 104-6 46) The most critical success factor for ERP systems is to have a solid commitment of the: A) consultants.

B) IT department.

C) top management.

D) end users.

Answer: C Diff: 2 Page Ref: 104-6

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47) To keep the costs down and also to minimize the chance of surprises, it is generally a good rule of thumb to minimize the number of: A) purchases.

B) customizations.

C) embedded processes.

D) special tools.

Answer: C Diff: 3 Page Ref: 104-6 48) The SDLC provides a systematic process for planning, ________, and creating an information system for organizations.

A) designing B) purchasing C) managing D) financing E) visualizing Answer: A Diff: 1 Page Ref: 91 49) The SDLC uses a(n) ________ approach for problem solving.

A) direct B) heuristic C) logical D) technical E) system Answer: E Diff: 2 Page Ref: 91 50) For ERP implementations, it is best if the ________ is composed of people with a wide variety of IT and business skills.

A) consulting team B) development team C) management team D) technical group E) change management group Answer: B Diff: 2 Page Ref: 91 51) The phases of the traditional SDLC include investigation, design, implementation, ________, maintenance.

A) feasibility B) purchasing C) analysis D) value proposition E) ASAP Answer: C Diff: 2 Page Ref: 91 6 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

52) In the ________ phase of the traditional SDLC, the team should do a thorough analysis of the costs and benefits of the proposed system.

A) maintenance B) design C) implementation D) analysis E) investigation Answer: E Diff: 1 Page Ref: 91 53) The primary task of the ________ phase of the traditional SDLC is to determine the user requirements of the new system.

A) maintenance B) design C) implementation D) analysis E) investigation Answer: D Diff: 2 Page Ref: 92 54) In the ________ phase of the traditional SDLC, the functional requirements have to be converted to system and process flow charts, user input screens, sample reports, etc.

A) maintenance B) design C) implementation D) analysis E) investigation Answer: B Diff: 2 Page Ref: 92 55) Hardware and software are acquired and installed in the ________ of the traditional SDLC life cycle.

A) maintenance B) design C) implementation D) analysis E) investigation Answer: C Diff: 2 Page Ref: 92

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56) Which of the following is not a typical problem with using the SDLC process for developing a new system?

A) too expensive B) too rigorous C) takes too long D) too much documentation Answer: D Diff: 2 Page Ref: 92 57) When using the prototyping approach, one does not go through the ________ stages of the traditional SDLC. A) maintenance and analysis B) design and analysis C) implementation and investigation D) analysis and investigation Answer: B Diff: 3 Page Ref: 93 58) If a sales manager developed a Microsoft Access database to help his salespeople track their customer contact information, this would be an example of an application developed using: A) prototyping.

B) SDLC processes.

C) end-user development.

D) the ERP life cycle.

Answer: C Diff: 2 Page Ref: 93 59) When the government wants to develop a new procurement tracking system for its military they would probably build it using: A) prototyping.

B) SDLC processes.

C) end-user development.

D) the ERP life cycle.

Answer: B Diff: 3 Page Ref: 94 60) Most ERP vendors and consultants try to compete against each other by having different: A) databases.

B) application servers.

C) implementation methodologies.

D) APIs. E) GUIs. Answer: C Diff: 2 Page Ref: 94

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61) ERP system development can make use of prototyping methodologies by using a(n) ________ to get more immediate user feedback as the system is being developed.

A) CASE tool B) Web server C) Web-based input form D) sandbox Answer: D Diff: 3 Page Ref: 94 62) ________ is not an example of a vendor-driven ERP development methodology.

A) Rapid-ERP B) FastTrack C) ASAP D) Total Solutions E) BIM Answer: A Diff: 3 Page Ref: 94 63) ________ is not a stage of the traditional ERP life cycle.

A) Investigation B) Scope and Commitment C) Analysis and Design D) Acquisition and Development E) Implementation Answer: A Diff: 2 Page Ref: 96 64) In the traditional ERP life cycle a gap analysis should be conducted in the ________ stage.

A) investigation B) scope and commitment C) analysis and design D) acquisition and development E) implementation Answer: C Diff: 3 Page Ref: 96 65) In the traditional ERP life cycle, by the end of the ________ stage, the team should have a prototype or sandbox of the ERP software up and running and accessible to the entire team, consultants, and SMEs. A) operations B) scope and commitment C) analysis and design D) acquisition and development E) implementation Answer: C Diff: 3 Page Ref: 96 9 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

66) In a ________ ERP life cycle implantation, employees are empowered to make the decisions to keep the project moving forward.

A) traditional B) rapid C) object-oriented D) vendor driven E) none of the above Answer: B Diff: 2 Page Ref: 100 67) The ________ ERP life cycle approach has a deliverable due at the end of each stage.

A) object oriented B) traditional C) rapid D) vendor driven E) none of the above Answer: B Diff: 2 Page Ref: 96 68) Stage ________ of the ERP life cycle is similar to the investigation stage of the SDLC. A) one B) two C) three D) four E) none of the above Answer: A Diff: 2 Page Ref: 96 69) A(n) ________ analysis is used to compare the functions provided by the ERP system to the operational processes necessary to run the business.

A) scope B) iterative C) gap D) investigation E) none of the above Answer: C Diff: 2 Page Ref: 96 70) System conversion and training are done in stage ________ of the ERP life cycle.

A) one B) two C) three D) four E) none of the above Answer: B Diff: 2 Page Ref: 95 10 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

71) The implementation phase of the ERP life cycle is also sometimes called the ________ stage.

A) Go-Live B) shortest C) longest D) failure E) none of the above Answer: A Diff: 2 Page Ref: 96 72) The ________ approach to ERP system conversion is the least disruptive conversion approach.

A) direct cutover B) pilot C) phased D) parallel E) none of the above Answer: C Diff: 3 Page Ref: 97 73) The ________ approach to system conversion has the highest risk of the different conversion approaches.

A) direct cutover B) pilot C) phased D) parallel E) none of the above Answer: A Diff: 3 Page Ref: 97 74) System failures often occur when not enough attention is devoted to ________ management from the beginning.

A) upper B) lower C) change D) shrinking E) none of the above Answer: C Diff: 3 Page Ref: 98

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75) Consultants may use scripts and ________ to help automate some of the more common tasks that occur during an implementation.

A) wizards B) merlins C) consultants D) hardware E) none of the above Answer: A Diff: 3 Page Ref: 99 76) What is an ERP implementation plan? How does an organization choose between all the different implementation plans?

Answer: An ERP implementation plan is used by organizations as a blueprint of the entire implementation. It is designed with all the cost, scope and time requirements in mind. Plans are evaluated by how well they fit with the project, the company, and the business rationale for the project. Plans can describe comprehensive ERP projects, where many of the ERP modules are implemented. A middle of the road ERP plan involves some changes in the core ERP modules and a significant amount of BPR. A vanilla ERP plan describes a project that uses the ERP software and embedded processes straight out of the box with little modification.

Diff: 2 Page Ref: 95 77) Describe a methodology for rapid system development.

Answer: Because the SDLC takes so long and is so expensive to use for developing information systems, much effort has been spent on trying to develop alternative methodologies. The most popular one is the idea of prototyping. The main idea is to get a working prototype of the system into the users hands as soon as possible in order to get their feedback on it. This then is iteratively refined. For smaller projects, training the users on the basics of software development and tools gives them the option of developing the applications themselves. This is also called the end-user development approach but it is only good for smaller applications.

Diff: 2 Page Ref: 92 78) Why is the traditional SDLC process not always a good fit for developing systems?

Answer: The traditional SDLC is good for complex and highly structured system development projects which require lots of checks and balances. The problem of the SDLC is that it often takes too long and the resulting system may be outdated. It is also a very expensive process and may be overkill for small-scale applications. It is also faulted because it doesn't get the users involved early on in the development process.

Diff: 2 Page Ref: 91

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79) How is the traditional ERP life cycle different from the traditional SDLC? Answer: The ERP project team is formed differently than in the SDLC with members drawn from every functional area. ERP projects also focus more on the processes of the business and less on individual system functions. Since ERP systems are usually built on top of existing ERP vendor packages the focus is also on customizing the existing software rather than on programming new applications. To keep the project on track, ERP projects need to have strong commitment from top management. This commitment also extends to supporting special change management initiatives to get the most out of the new system.

Diff: 3 Page Ref: 105 80) Describe the main phases or stages of the traditional SDLC. Answer: The traditional SDLC breaks the system development process into five separate phases or stages. In the first investigation phase, the system feasibility is determined and a report is produced on this. This leads to a detailed analysis of the existing system and a determination of what the future system should be able to do in the second, analysis phase. The output from this phase has to be converted into a set of detailed design specifications in the design phase. The hardware and software are acquired and customized in the implementation phase, and then the systems are maintained in the maintenance phase. This includes ongoing training and system upgrades and debugging.

Diff: 2 Page Ref: 92 81) Describe the main phases or stages of the traditional ERP life cycle.

Answer: The traditional ERP life cycle begins with the scope and commitment stage. Besides doing the feasibility study, in this stage the scope of the ERP application in the enterprise is determined. The project team is set up also at this time. In the analysis and design stage the project team does a gap analysis and also chooses the ERP vendor and any consultants. This leads to the acquisition and development stage. Based on the gap analysis the software is configured and the hardware is set up. Any necessary data must be migrated over to the new system also. This leads to the implementation stage when the new system is released to the users in a predefined conversion strategy. When the resulting system is handed over to the IT personnel, this is the final stage called the operation stage.

Diff: 2 Page Ref: 96-7 82) What is change management? What role does it play in the ERP life cycle?

Answer: Change management (CM) is important for the success of ERP systems because they are intended to make drastic changes to the existing business processes. Once the processes have been identified that will be changed and the job descriptions that will be changed, all of these changes need to be communicated to the affected end users. Users will also need training in how the processes have changed and how they play a role in the new processes.

Diff: 3 Page Ref: 99

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83) Describe one of the rapid ERP life cycle methodologies. Why is their use growing?

Answer: In the world of ERP implementations, a number of software vendors and consultants have developed rapid implementation methodologies to try and reduce the cost. These include the FastTrack, RapidRe, ASAP, and BIM. SAP developed the ASAP Roadmap methodology to break up the project into the phases of Project Preparation, Blueprinting, Realization, Final Preparation, and then the Go Live and Support phase. The Blueprint provides a guideline for the developers when they do their gap analysis and serves as an interviewing tool. It gives them a better starting point so they aren't constantly starting from scratch. The large savings in time and resources have made these more popular.

Diff: 3 Page Ref: 100-1 84) In developing an ERP system, the focus is more on the business processes rather than the traditional focus on getting the user requirements. Why is this a major difference?

Answer: This may seem like a small difference at first, but it is a difficult thing to get everyone across the enterprise to think in terms of the overall processes and how they can be reengineered to be more efficient. Users normally just think about the data and processes that they need or work with. This focus will also mean that the implementation team will be composed of people from all the different functional areas. Since ERP software comes with best practices embedded in it, the users will spend much more time on determining where it should be customized and where it can be used unchanged.

Diff: 3 Page Ref: 96

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 5 Implementation Strategies 1) One of the good things about ERP systems is that they don't require much in the way of hardware to run them.

Answer: FALSE Diff: 2 Page Ref: 141 2) To run ERP software, high-end multi-processor servers are usually needed.

Answer: TRUE Diff: 2 Page Ref: 141 3) The current generation of ERP systems uses thick clients to access the software.

Answer: FALSE Diff: 3 Page Ref: 142 4) Because they are self-contained and have embedded processes, EP systems do not require extra long-term storage devices.

Answer: FALSE Diff: 3 Page Ref: 142 5) ERP systems work on all operating systems except Linux.

Answer: FALSE Diff: 2 Page Ref: 142 6) Reliable multi-user DBMSs are also required when implementing an ERP system.

Answer: TRUE Diff: 1 Page Ref: 142 7) Because they are such strong competitors, SAP ERP software will not run on Oracle's DBMS. Answer: FALSE Diff: 2 Page Ref: 142 8) Most ERP systems today can work with a variety of DBMSs. Answer: TRUE Diff: 1 Page Ref: 143 9) Project management software is required for an ERP implementation.

Answer: FALSE Diff: 2 Page Ref: 143 10) Security software is not necessary in ERP systems.

Answer: FALSE Diff: 1 Page Ref: 143

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11) An employee or client may be an end-user of an ERP system.

Answer: TRUE Diff: 1 Page Ref: 143 12) A database administrator is an example of an IT specialist who might be a member of the ERP implementation team.

Answer: TRUE Diff: 2 Page Ref: 143 13) The change management team determines the gaps between the ERP functionality and the business process requirements.

Answer: FALSE Diff: 3 Page Ref: 143 14) The QA team customizes the ERP system functionality.

Answer: FALSE Diff: 3 Page Ref: 144 15) When functionality is missing from an ERP package, sometimes it can be provided by using a third party product.

Answer: TRUE Diff: 2 Page Ref: 144 16) Integration is the sharing of data and data elements directly with the ERP system.

Answer: TRUE Diff: 2 Page Ref: 149 17) Sometimes when two software products are integrated, the vendors will only allow specially qualified IT personnel to make changes to them such as installing an upgrade.

Answer: TRUE Diff: 3 Page Ref: 149 18) In general, interfaces should be two-way.

Answer: FALSE Diff: 3 Page Ref: 149 19) Vendors will often give their software partners an early release of any new products or upgrades so the partner has a chance to change their product to work with the new release.

Answer: TRUE Diff: 2 Page Ref: 148 20) Integrating other systems is a major problem for ERP systems.

Answer: TRUE Diff: 1 Page Ref: 149

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21) The problem with relational databases is that they are hard to connect to ERP systems.

Answer: FALSE Diff: 2 Page Ref: 149 22) In order to execute transactions, the ERP system must retrieve and summarize large amounts of data.

Answer: FALSE Diff: 3 Page Ref: 149 23) Processing transactions and generating reports do not work well with a single database instance.

Answer: TRUE Diff: 3 Page Ref: 149 24) Most database packages can be used to support large ERP system implementations.

Answer: FALSE Diff: 1 Page Ref: 149 25) ERP project management is considered to be a component of ERP governance.

Answer: TRUE Diff: 2 Page Ref: 150 26) In an ERP system implementation, staff should outline and define committees and workgroups that are responsible for different components of the implementation.

Answer: FALSE Diff: 2 Page Ref: 150 27) It is crucial that the governance structure be bypassed by all involved before the ERP project begins.

Answer: FALSE Diff: 2 Page Ref: 150 28) Governance helps define the processes and underlying accountabilities that guide the management of the ERP project.

Answer: TRUE Diff: 3 Page Ref: 151 29) The Project software oversees all project activities and makes sure that the project stays within its scope.

Answer: FALSE Diff: 2 Page Ref: 152 30) In terms of governance, senior management are the owners of the ERP project.

Answer: TRUE Diff: 2 Page Ref: 151

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31) The person who is ultimately responsible for the success of the ERP implementation is the consultant.

Answer: FALSE Diff: 2 Page Ref: 151 32) The Change Management team is typically a part of the larger project team.

Answer: TRUE Diff: 2 Page Ref: 152 33) One key to a successful ERP implementation is to have a well-defined and proven methodology.

Answer: TRUE Diff: 3 Page Ref: 154 34) A project methodology should address all the components of the project from project startup through system planning.

Answer: FALSE Diff: 3 Page Ref: 155 35) If a company chooses a "vanilla" ERP implementation, they will have to change their own business practices to fit the software.

Answer: TRUE Diff: 3 Page Ref: 155 36) A single ERP system cycle is easier to maintain and support.

Answer: FALSE Diff: 3 Page Ref: 155 37) ERP implementations with a lot of customization may require extensive maintenance when the system is upgraded.

Answer: TRUE Diff: 3 Page Ref: 155 38) When an ERP system is upgraded, often bugs and problems are associated with the: A) applications.

B) databases.

C) modules.

D) modified code.

Answer: D Diff: 3 Page Ref: 156

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39) The decision to modify or not modify an ERP system is critical and should be done ________ of the implementation.

A) at the beginning B) throughout C) in the design phase D) in the maintenance phase Answer: A Diff: 3 Page Ref: 156 40) ________ is not typically a reason for implementing an ERP system.

A) Replacing legacy systems B) Improving services C) Increasing costs D) Increasing profit margins Answer: C Diff: 2 Page Ref: 156 41) Most new ERP systems are ________ which provides flexible access to the applications.

A) single instances B) web-based C) scalable D) network-based Answer: B Diff: 2 Page Ref: 157 42) The infrastructure behind an ERP system must be planned with the idea that it will probably have to be ________ as the system matures.

A) decommissioned B) archived C) expanded D) processed E) integrated Answer: C Diff: 2 Page Ref: 158 43) For their ERP implementations, some businesses ________ the server and the database environment.

A) develop B) outsource C) use D) offshore Answer: B Diff: 2 Page Ref: 158

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44) In order to ensure that their desktop PCs are secure, businesses often develop ________ PC configurations for users.

A) advanced B) in-house C) embedded D) standard Answer: D Diff: 3 Page Ref: 158 45) Security ________ is critical to any systems reliability and integrity.

A) designing B) purchasing C) managing D) awareness E) configuration Answer: D Diff: 2 Page Ref: 158 46) Hurricane Katrina made it clear how important disaster ________ is today for every ERP implementation.

A) problem-solving B) infrastructure C) planning D) management Answer: C Diff: 2 Page Ref: 158 47) When planning for disasters, it is important to first identify those systems that are: A) outsourced.

B) legacy systems.

C) highly technical.

D) mission critical.

Answer: D Diff: 2 Page Ref: 158 48) An ERP system needs a powerful set of ________ for development, testing and its production environments.

A) protocols B) consultants C) servers D) vendors Answer: C Diff: 2 Page Ref: 141

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49) The hardware resources needed for an ERP system include servers, clients, and: A) peripherals.

B) memory.

C) software.

D) browsers.

E) wireless routers.

Answer: A Diff: 3 Page Ref: 141 50) The key software resources for ERP systems include ________, database management systems, and applications.

A) maintenance software B) project management software C) system software D) browsers Answer: C Diff: 3 Page Ref: 142 51) Application software is the programs or ________ that help in the development, monitoring, and integration of ERP software.

A) legacy systems B) utility software C) databases D) system software Answer: B Diff: 3 Page Ref: 143 52) Database administrators and IT operations support personnel are examples of: A) end-users.

B) design team members.

C) IT executives.

D) IT specialists.

Answer: D Diff: 2 Page Ref: 143 53) The success or failure of an ERP implementation is ultimately in the hands of the: A) end-users.

B) design team members.

C) IT executives.

D) IT specialists.

Answer: A Diff: 2 Page Ref: 143

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54) The ________ has to put together a good project team and work with top management to get support and resources for the project.

A) Steering Committee B) project manager C) IT executive D) IT specialist Answer: B Diff: 3 Page Ref: 144 55) The ________ team determines the gaps between the ERP functionality and the business process requirements.

A) functional B) change management C) development D) data migration Answer: A Diff: 3 Page Ref: 144 56) The ________ team customizes the systems functionality.

A) functional B) change management C) development D) data migration Answer: C Diff: 2 Page Ref: 144 57) The ________ team works with end-user training, communications and support activities.

A) functional B) change management C) development D) data migration Answer: B Diff: 2 Page Ref: 144 58) ________ are add-on software components to either make the system operational or add missing functionality not offered by the ERP system.

A) Applications B) Web sites C) E-business components D) Third party products Answer: D Diff: 2 Page Ref: 149

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59) A(n) ________ is a process by which data or data tables are copied or updated to and/or from the ERP system.

A) methodology B) protocol C) interface D) integration E) data migration Answer: C Diff: 3 Page Ref: 149 60) The downside of using an interface for integration is that the data will not be as ________ as it would be if it were integrated more directly.

A) accurate B) timely C) economical D) valuable Answer: B Diff: 2 Page Ref: 149 61) The recent development of ________ is an attempt to solve the interfacing and integration problems associated with ERP systems.

A) operating systems B) bolt-ons C) project management tools D) middleware E) AI tools Answer: D Diff: 3 Page Ref: 149 62) ERP systems are initially set up to support ________ as opposed to supporting the reporting component.

A) decision-making B) planning C) transactional components D) marketing E) project management Answer: C Diff: 3 Page Ref: 149

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63) The ________ Committee will oversee the project's efforts and ensure appropriate leadership.

A) Executive B) Steering C) Governance D) ERP E) none of the above Answer: B Diff: 3 Page Ref: 152 64) The ________ is/are responsible for resolving functional issues raised to the Steering Committee.

A) application steward B) project manager C) project executives D) steering committee E) none of the above Answer: A Diff: 3 Page Ref: 152 65) The ________ is/are in charge of managing the day-to-day aspects of the ERP project.

A) application steward B) project manager C) project executives D) steering committee E) none of the above Answer: B Diff: 2 Page Ref: 152 66) Project team members provide direction and ERP application knowledge with respect to business ________ design and configuration.

A) hardware B) software C) process D) data E) none of the above Answer: A Diff: 3 Page Ref: 152 67) The ________ meets to resolve all cross-module issues.

A) project team B) cross-functional team C) steering committee D) change management team E) none of the above Answer: B Diff: 3 Page Ref: 153 10 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

68) No ERP system is totally ________ and meets all the user requirements.

A) paid for B) finished C) bug-free D) free E) none of the above Answer: C Diff: 2 Page Ref: 153 69) Having a well-defined project methodology is very helpful in managing the inherent ________ of the ERP project.

A) hardware B) software C) costs D) risks E) none of the above Answer: D Diff: 2 Page Ref: 154 70) ________ play an important role in the rapid implementation of ERP systems.

A) Consultants B) Data C) Software D) Hardware E) none of the above Answer: A Diff: 2 Page Ref: 154 71) External consultants may be valuable implementation partners because they have the ________ and experience of implementing many successful projects.

A) time B) money C) knowledge base D) hardware E) none of the above Answer: C Diff: 3 Page Ref: 155 72) Faster servers and increases in storage capacities made the single ________ feasible for ERP systems.

A) database instance B) user interface C) access point D) governance E) none of the above Answer: A Diff: 3 Page Ref: 155 11 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

73) An ERP project is said to be a "vanilla" implementation when ________ are not allowed.

A) users B) modifications C) managers D) chocolates E) none of the above Answer: B Diff: 2 Page Ref: 155 74) Change management activities should ________ the entire ERP project.

A) occur throughout B) occur in the beginning of C) occur at the end of D) never occur in E) none of the above Answer: A Diff: 2 Page Ref: 155 75) Businesses that are not skilled at building or changing systems should consider a(n) ________ ERP implementation.

A) massive B) comprehensive C) vanilla D) chocolate E) none of the above Answer: C Diff: 2 Page Ref: 155 76) What are the main hardware components of an ERP system?

Answer: The hardware components include all the computer devices in the ERP system. This includes servers, clients and peripherals. Servers are high end, multi-processor machines with 64 bit processors and lots of RAM and secondary storage. Peripherals are all the other devices that attach to the system for further functionality such as archive servers, printers, networking hardware, and backup power supplies. Clients include the variety of devices that end-users will use to connect to the ERP system such as PDAs and PCs. Diff: 2 Page Ref: 141 77) Describe the different software components used in an ERP system.

Answer: Software includes the program instructions and logic that control the hardware in the ERP system. The most fundamental piece of software is the system software or operating systems such as Window, Unix, and Linux that help manage and connect all the hardware resources. Next is the underlying database management system software which helps manage the vast amount of data used in an ERP system. Then of course, there is the application software itself which captures the business logic of the ERP application.

Diff: 2 Page Ref: 142

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78) Without the necessary people, ERP projects could not be successful. What are some of the roles played in an ERP implementation?

Answer: The actual end-users include the employees, clients, vendors and others who will ultimately use the system for their work, so they are crucial to its success. Then there is a large group of IT specialists who are database administrators, support people, developers, trainers, etc.., who help run and maintain the system. The project manager will also put together the project team and work with top management to acquire all the resources necessary.

Diff: 2 Page Ref: 143 79) What are some of the different sub-teams that will work with the overall implementation team?

Answer: The overall implementation will form and work with a variety of sub-teams such as the functional area teams, change management teams, development teams, data migration teams, QA team, and system support team. They all have important roles to perform and their work must be carefully coordinated.

Diff: 3 Page Ref: 143 80) What are third party products and why are they needed?

Answer: Third party products are add-ons or sometimes called ERP bolt-ons which are intended to provide additional or missing functionality that is not part of the ERP package. For example, some companies will purchase an RFID bolt-on to expand their ERP system. These packages can be either purchased or developed in-house and may include operational software to help distribute reports or enforce better security.

Diff: 2 Page Ref: 144 81) What is integration and why is it so important for ERP systems?

Answer: Integration is defined as the sharing of data and data elements directly with the ERP system without data redundancy or copying of data to another table or database. This is especially important in the context of trying to connect third party products to the ERP system.

One must decide whether to integrate them directly or to use an interface to connect them. In general, the interfaces should one-way either to the third party component or from the component to the ERP system.

Diff: 3 Page Ref: 148 82) How do ERP systems make use of database technology?

Answer: Relational database technology has steadily improved since the 1970s and now provides the backbone for ERP systems. However, ERP systems have two different, conflicting uses of databases. First and foremost, they must efficiently process a potentially huge number of transactions. In contrast to this, transaction data must be summarized and used for generating and disseminating reports to a large number of users. Since these are two different purposes, it is usually the case that an ERP system has multiple databases behind them; some for transaction processing and some for data analysis and reporting. The most common relational databases used with ERP systems are Oracle, DB2, Sybase, and SQL Server.

Diff: 3 Page Ref: 149

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83) What is meant by ERP governance?

Answer: In an ERP implementation, governance should outline and define the responsibilities of the different workgroups and committees. The components of governance include project organization, project management, project owners and sponsors, budget management, and issue escalation processes. In any ERP implementation, it is critical that governance be defined and communicated to all involved in the process.

Diff: 3 Page Ref: 150 84) What are the issues associated with the infrastructure platform on which the ERP system will run?

Answer: There are a number of important infrastructure considerations that can impact the success of an ERP project. The infrastructure platform issues include the Internet and network connectivity, system bandwidth, security, transaction volume, user load, and backup and recovery. Servers and database capacity must be planned with system expansion in mind.

Network connectivity and bandwidth must also be planned and tested for high volume transactions. Organizations may also create a standard PC configuration to limit the security problems.

Diff: 2 Page Ref: 157

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 6 Software and Vendor Selection 1) The customer is often blamed for an unsuccessful implementation.

Answer: FALSE Diff: 2 Page Ref: 169 2) Once the decision has been made to implement an ERP system, the initial step is to select an ERP vendor.

Answer: TRUE Diff: 1 Page Ref: 169 3) Companies often bring in specialized consulting firms to assist in the ERP vendor selection process.

Answer: TRUE Diff: 2 Page Ref: 169 4) The final step in the ERP purchasing process is to release the request for bid to the vendors.

Answer: FALSE Diff: 1 Page Ref: 169 5) Pricing for the ERP software is done in the Needs/Requirements assessment step of the purchasing process.

Answer: FALSE Diff: 2 Page Ref: 170 6) Usually the first step in selecting an ERP system is researching the ERP vendors on the market.

Answer: TRUE Diff: 1 Page Ref: 170 7) State of the art ERP systems usually can be run on old legacy hardware without any problems.

Answer: FALSE Diff: 2 Page Ref: 170 8) When selecting an ERP software package, it is important to research all aspects of the package including the platform on which it will run.

Answer: TRUE Diff: 1 Page Ref: 170 9) It is not a good idea to include end-users in the vendor selection process as this will only complicate the process.

Answer: FALSE Diff: 2 Page Ref: 170

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10) An ERP vendor should not be required to explain their software release and upgrade strategies as this is a separate issue from the purchasing decision.

Answer: FALSE Diff: 2 Page Ref: 170 11) It is good to ask department managers and subject matter experts if they have any knowledge or experience with ERP vendors.

Answer: TRUE Diff: 1 Page Ref: 170 12) It is important to consider the ERP vendor's overall financial position when selecting an ERP vendor.

Answer: TRUE Diff: 2 Page Ref: 170 13) A business should not bother to examine what ERP packages their competition uses when selecting an ERP vendor.

Answer: FALSE Diff: 1 Page Ref: 170 14) Great Plains is designed to be used by companies that have a large number of potential users.

Answer: FALSE Diff: 2 Page Ref: 170 15) Company size is an important factor to consider when choosing an ERP package since some packages don't work well with large numbers of users.

Answer: TRUE Diff: 2 Page Ref: 170 16) PeopleSoft is known for its financial applications in the ERP software market.

Answer: FALSE Diff: 2 Page Ref: 170 17) Some ERP products are designed with a particular industry focus.

Answer: TRUE Diff: 1 Page Ref: 170 18) Some ERP vendors have focused their products on specific IT platforms.

Answer: TRUE Diff: 1 Page Ref: 170 19) Once the ERP system is installed, the relationship with the ERP software vendor is completed.

Answer: FALSE Diff: 2 Page Ref: 171

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20) After researching all the ERP vendors, the results should be a short list of possible vendors.

Answer: TRUE Diff: 1 Page Ref: 171 21) The functional requirements process will be helpful in choosing an ERP vendor.

Answer: TRUE Diff: 3 Page Ref: 171 22) The RFI is an essential part of the ERP vendor bidding process.

Answer: FALSE Diff: 3 Page Ref: 173 23) Along with responding to the RFI, ERP vendors often will do a demo of their system.

Answer: TRUE Diff: 2 Page Ref: 173 24) The bidding process is required for purchasing an ERP system in private industry.

Answer: FALSE Diff: 2 Page Ref: 173 25) The RFP should specify what infrastructure the company already has in place.

Answer: TRUE Diff: 2 Page Ref: 173 26) The RFP or RFQ is sent to ERP vendors to get bids on specific ERP systems.

Answer: FALSE Diff: 2 Page Ref: 174 27) All the ERP bids will need to be carefully evaluated by the different groups of people involved in the decision-making process.

Answer: TRUE Diff: 2 Page Ref: 174 28) The largest cost of the ERP system occurs after the implementation with the system design and upgrades.

Answer: FALSE Diff: 3 Page Ref: 174 29) TCO provides a financial framework for evaluating and comparing ERP vendors and products.

Answer: TRUE Diff: 3 Page Ref: 174 30) The accuracy of TCO when applied to ERP systems has been marginal but is still a worthwhile exercise in the selection process.

Answer: TRUE Diff: 3 Page Ref: 174 3 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

31) The ERP implementation contract is usually separate from the software vendor license and contract.

Answer: TRUE Diff: 3 Page Ref: 175 32) In the ERP software vendor contract it is important that all of the investments are clearly defined.

Answer: FALSE Diff: 3 Page Ref: 175 33) If the client miscounts the number of users, this would be an example of a(n) foreseeable circumstance that may require a change in the contract.

Answer: FALSE Diff: 3 Page Ref: 176 34) Most companies base their ERP system requirements on a business process reengineering analysis.

Answer: TRUE Diff: 1 Page Ref: 176 35) Negotiating with two ERP vendors will yield a higher purchase price.

Answer: FALSE Diff: 1 Page Ref: 176 36) Buying a new ERP system usually means that the company will also have to update their attorneys.

Answer: FALSE Diff: 2 Page Ref: 170 37) A good potential ERP vendor will have an active user base involved in defining future functional changes, and this is important to consider when selecting a vendor.

Answer: TRUE Diff: 3 Page Ref: 170 38) When considering an ERP vendor it is important consider the hardware and software infrastructure preferred to support the ERP system.

Answer: TRUE Diff: 2 Page Ref: 170 39) Oracle recently acquired, Seibel, JDEdwards and PeopleSoft in order to centralize their offerings in the ERP world.

Answer: FALSE Diff: 2 Page Ref: 170

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40) Senior management must be committed to the ERP project in terms of both resources and time or the project is doomed to failure from the beginning.

Answer: TRUE Diff: 3 Page Ref: 171 41) When evaluating an ERP vendor, it is important to consider the ________, or the companies already using the system.

A) partners B) user base C) module portfolio D) change management team Answer: B Diff: 2 Page Ref: 171 42) If the ERP vendor is a publicly traded firm it is useful to examine public reports to make sure they are in strong ________ position.

A) managerial B) growth C) technical D) financial Answer: D Diff: 1 Page Ref: 171 43) IT ________ companies regularly survey the ERP market and are a good source of current information on any implementation or support issues that may be happening.

A) marketing B) design C) research D) management Answer: C Diff: 2 Page Ref: 171 44) When selecting an ERP vendor it is important to consider the hardware and software infrastructure the ERP vendor supports since this will determine the fit and ________ of the system.

A) instances B) web capabilities C) scalability D) bandwidth Answer: C Diff: 3 Page Ref: 170

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45) ERP vendors usually issue a statement of ________ which describes where future development of the product is headed.

A) direction B) support C) historical evolution D) vendor upgrades Answer: A Diff: 2 Page Ref: 170 46) Some ERP products were developed using ________ technology, so it is important that ERP vendors be able to migrate quickly to current technologies.

A) outsourced B) older C) used D) offshore Answer: B Diff: 1 Page Ref: 171 47) ERP vendors have different ________ strategies which determine the content and frequency of new system fixes and upgrades.

A) development B) management C) cost D) release Answer: D Diff: 3 Page Ref: 171 48) It is good to consider the relative ________ of development and maintenance staff that each ERP vendor has available.

A) awareness B) position C) proportion D) configuration training E) training Answer: C Diff: 2 Page Ref: 171 49) Microsoft's ERP product is called: A) Fusion.

B) Great Plains.

C) NetWeaver.

D) Epicor.

Answer: B Diff: 2 Page Ref: 172

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50) ________ currently claims the largest share of the ERP software market.

A) Oracle B) PeopleSoft C) SAP D) Lawson Answer: C Diff: 1 Page Ref: 171 51) ________ is an ERP vendor that focuses on the mid-market.

A) Epicor B) PeopleSoft C) SAP D) Lawson Answer: A Diff: 2 Page Ref: 172 52) ________ was the first ERP vendor to develop and deploy 100 percent internet-enabled enterprise software across its whole product line.

A) Oracle B) PeopleSoft C) SAP D) Lawson E) SSA Global Answer: A Diff: 3 Page Ref: 172 53) A key factor in choosing a software vendor will be the extent to which the ________ match the functionality of the ERP software.

A) maintenance upgrades B) project philosophies C) eCommerce strategies D) user requirements Answer: D Diff: 3 Page Ref: 173 54) In the functional requirements document, a key component will describe how the crossfunctional ________ of the new integrated ERP system will affect departments within the company.

A) legacy systems B) utilities C) databases D) data flows Answer: D Diff: 3 Page Ref: 173

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55) The ________ document will describe the level of importance of each function for each department within the company.

A) design B) functional requirements C) RFP D) vendor requirements Answer: B Diff: 3 Page Ref: 173 56) Once the departmental functions and business processes have been documented, a written request, or ________ is sent to potential ERP vendors asking for information.

A) RFI B) RFP C) RFB D) functional requirements analysis Answer: A Diff: 2 Page Ref: 174 57) In ________ institutions, the bid process is almost always required.

A) private B) non-profit C) public D) corporate Answer: C Diff: 2 Page Ref: 174 58) Because there are many ________ to an ERP system bid, multiple teams with a variety of skill sets will be needed to compare and evaluate the bids.

A) functions B) changes C) modules D) components Answer: D Diff: 3 Page Ref: 174 59) The choice of an ERP vendor should not just focus on cost or functionality, but on the best: A) process management scenarios.

B) change management team.

C) overall fit.

D) data migration plan.

Answer: C Diff: 2 Page Ref: 174

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60) The actual cost of the ERP software itself should be around ________ of the overall cost.

A) 15% B) 25% C) 35% D) 45% Answer: A Diff: 2 Page Ref: 174 61) Potential customers often use the ________ as a financial framework for evaluating the different ERP systems proposed to them.

A) ROI B) NPV C) PP D) TCO Answer: D Diff: 2 Page Ref: 174 62) Companies often turn to professional ________ companies for their ERP implementations instead of contracting with the software vendor to install and configure their new ERP system.

A) development B) consulting C) outsourcing D) integration E) data migration Answer: B Diff: 3 Page Ref: 175 63) Deliverables must be clearly identified and delivery dates associated with them in the: A) RFI. B) purchase order.

C) RFB. D) ERP contract.

Answer: D Diff: 2 Page Ref: 175 64) It is more difficult for an ERP vendor to cut corners if the customer has a clear ________ for each deliverable.

A) statement of intent B) scope document C) acceptance contract D) functional requirements document Answer: C Diff: 3 Page Ref: 176

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65) If after the ERP project starts and it turns out that the hardware for supporting the volume of transactions was undersized then it may be necessary to ________ the contract.

A) dissolve B) change C) re-bid D) finalize Answer: B Diff: 2 Page Ref: 176 66) To help evaluate ERP vendors it is often helpful to check the ________ that they provide from previous customers.

A) references B) invoices C) processes D) pictures E) none of the above Answer: A Diff: 2 Page Ref: 174 67) The TCO of an ERP system includes getting the system installed and also the cost of running the system for ________ years afterward.

A) two B) five C) ten D) twenty E) none of the above Answer: A Diff: 3 Page Ref: 174 68) According to a rule of thumb, the cost of installing the system is about ________ times the ERP license costs.

A) two B) six C) ten D) twenty E) none of the above Answer: B Diff: 2 Page Ref: 174

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69) When the ERP vendor evaluation process gets down to the final two vendors, it is good to create a ________ between the two vendors.

A) synergy B) competition C) RFB D) TCO E) none of the above Answer: B Diff: 2 Page Ref: 175 70) Terms and conditions will be a significant part of the vendor contract and will be addressed by the ________.

A) managers B) executives C) attorneys D) consultants E) none of the above Answer: C Diff: 3 Page Ref: 175 71) The contact manager will become an expert on the ERP ________ and conditions.

A) hardware B) software C) contract terms D) data E) none of the above Answer: C Diff: 2 Page Ref: 175 72) ________ that specialize in selection of ERP vendors may be brought in at the beginning of the process.

A) Consultants B) Attornies C) Managers D) Executives E) none of the above Answer: A Diff: 2 Page Ref: 169 73) During contract negotiations it is best to over ________ about the progress being made.

A) state B) commit C) communicate D) price E) none of the above Answer: C Diff: 3 Page Ref: 175 11 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

74) It is important to include ________ in the vendor selection process since this will help in change management later on.

A) attorneys B) consultants C) executives D) end-users E) none of the above Answer: D Diff: 2 Page Ref: 170 75) Some ERP products cannot support a large number of ________ so this will be an important factor to consider when choosing a vendor.

A) attorneys B) users C) consultants D) executives E) none of the above Answer: B Diff: 2 Page Ref: 170 76) What should be the first step in the process of selecting an ERP vendor?

Answer: The first step should be to research all the different vendors of ERP systems on the market and come up with a short list of vendors who will be able to meet the general business requirements. If the company is running their current systems on outdated legacy systems, much of the research should focus on those computer platforms that will support the hardware and software needed to move the company to the cutting edge.

Diff: 2 Page Ref: 169-70 77) Describe three different factors that should be researched when examining potential ERP vendors.

Answer: Because ERP systems are so complex, there is a wide variety of questions that should be asked when researching potential ERP vendors. Because you want a company that will be around in ten years, their financial position should be considered. Other businesses who have used them should also be consulted and their reference customers checked. In the industry, you should check what your competition is using. A major consideration will be the infrastructure that their ERP system supports and how many users it will support. Of course, they should be using the latest technologies and should have a release and upgrade strategy. The quality of their customer support and maintenance should also be checked.

Diff: 2 Page Ref: 169-170

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78) What is a "release strategy" and why is it an important factor in choosing an ERP vendor?

Answer: This is an important factor to consider because it can vary quite a bit from vendor to vendor. The release strategy describes how often fixes, minor upgrades, and new releases of the software will be made. They should be able to tell you how often major releases will come and how long the vendor will support the older releases. There should also be a defined upgrade path.

Vendors will also vary a bit in what they charge for upgrades and how well they keep up with the maintenance of them.

Diff: 2 Page Ref: 171 79) Describe the main ERP vendors and what distinguishes them from the rest.

Answer: There are probably several dozen different ERP vendors, but with the recent acquisitions, now there are only about four or five major ERP vendors. The oldest and largest of these is the German company, SAP. Their ERP products span all sizes of firms and industries.

The number two vendor is certainly the combination of Oracle/PeopleSoft. In addition to their market leading database product, they were also the first vendor to 100% web-enable all of their products. Lawson is a mid-size ERP vendor who focuses on industry-tailored software solutions.

Microsoft entered the market with their product, Great Plains, which is oriented towards smaller companies.

Diff: 2 Page Ref: 173 80) What should be the result of the functional requirements process? How is this used in the selection of an ERP vendor?

Answer: The process of determining the functional requirements of the new ERP system involves first documenting the current legacy systems functionality or using business process reengineering to identify the "best practices" in that particular industry. There should be two major documents output from this process. One will describe the data and functional flow of departmental/business processes and any changes to those processes. The second major document will be a description of all the functions in each department and relative level of importance of each of these functions.

Diff: 3 Page Ref: 173 81) What is an RFP and how is it used in the vendor selection process?

Answer: The RFP, short for "Request for Proposals," is sometimes also called the RFB or request for bids. Once a list of potential ERP vendors has been identified, then they are provided with a description of all the existing systems and the desired functionality, along with the hardware, software, and training requirements. They are also provided with a description of how the selection process will proceed and deadlines for their proposals. This should make it much easier to compare each vendor and decide which one will provide the best fit for the organization.

Diff: 2 Page Ref: 174

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82) What are the different skills needed to thoroughly evaluate the various bids from ERP vendors?

Answer: Because ERP system bids are so complex and have so many different components, it is important to have a team with a wide variety of skills help to evaluate the bids. Of course, the IT staff will have to help evaluate the technology requirements and how well the bid satisfies them.

The end users and office staff will be useful for evaluating the usability and functionality of the proposed system. Specialized knowledge about the pricing and contract conditions will have to come from the corporate contract staff also. Their input should help narrow the choice of vendors down to one or two finalists.

Diff: 2 Page Ref: 174 83) What is meant by TCO and how is it used to evaluate ERP system bids?

Answer: TCO is short for "Total Cost of Ownership" and this provides a financial framework for comparing different ERP bids and alternative designs. TCO costs include hardware, software, training, and implementing the system. They also include all the cost of maintenance, optimization, and upgrading for a period of two years after the installation. Some claim that this is not a very accurate measure of ERP systems, but it is a helpful input into the ERP selection process.

Diff: 3 Page Ref: 174 84) What is contract life cycle management and how is this used in ERP implementations?

Answer: Careful management of all the aspects of an ERP contract will increase the chances of a successful ERP implementation. This means that the contract has to clearly identify all the deliverables and their delivery dates. The contract should also make sure that the customer has acceptance authority so that there is less chance for squabbling over unsatisfactory work. The contract should also specify the individuals who are responsible on both sides of the contract and who will have authority to authorize any changes in the contract.

Diff: 2 Page Ref: 175

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 7 Operational and Post-Implementation 1) The ERP implementation phase is just after the go live phase.

Answer: FALSE Diff: 2 Page Ref: 191 2) A readiness assessment should be conducted before going live.

Answer: TRUE Diff: 1 Page Ref: 192 3) The readiness process should only include key "super" users.

Answer: FALSE Diff: 2 Page Ref: 192 4) The stabilization period is from the go live date to about 90 days after, or until the number of issues to be fixed is reduced to a manageable number.

Answer: TRUE Diff: 2 Page Ref: 192 5) Work on the system development should continue during the stabilization period.

Answer: FALSE Diff: 3 Page Ref: 192 6) Once the system is in the production phase, there is no further need for training.

Answer: FALSE Diff: 1 Page Ref: 192 7) Training should gear up during the readiness process.

Answer: TRUE Diff: 2 Page Ref: 192 8) The assessment of readiness should start just before the go live date.

Answer: FALSE Diff: 3 Page Ref: 192 9) Elaborate readiness checkpoints help insure that the go live process is smooth.

Answer: TRUE Diff: 2 Page Ref: 192 10) The readiness process will focus on assessing whether the system configuration is ready for go live.

Answer: FALSE Diff: 3 Page Ref: 193

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11) Everything should be completed and ready for testing at the first readiness checkpoint.

Answer: FALSE Diff: 2 Page Ref: 193 12) The readiness process will clarify what needs to be done and provide more focus for the project team.

Answer: TRUE Diff: 2 Page Ref: 193 13) There should be at least three readiness reviews before the ultimate decision to go live.

Answer: TRUE Diff: 3 Page Ref: 194 14) The readiness review status and the go live date should only be communicated to the team leads.

Answer: FALSE Diff: 2 Page Ref: 194 15) The process for determining readiness consists of a series of meetings and discussions on the status of each of the area tasks.

Answer: TRUE Diff: 2 Page Ref: 195 16) The PMO is the Project Maintenance Office.

Answer: FALSE Diff: 1 Page Ref: 194 17) If everything isn't ready by the first readiness assessment, the go live date should be pushed back.

Answer: FALSE Diff: 3 Page Ref: 194 18) Senior management should review each of the readiness assessment reports.

Answer: TRUE Diff: 1 Page Ref: 195 19) It is only necessary to train the key users of the system in each functional area.

Answer: FALSE Diff: 2 Page Ref: 195 20) Training for users should focus on how they will use the new system for daily processing of transactions.

Answer: TRUE Diff: 2 Page Ref: 195

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21) For security reasons, users should only train on the practice instance in the training labs.

Answer: FALSE Diff: 3 Page Ref: 195 22) A practice instance should use real data and configurations.

Answer: TRUE Diff: 2 Page Ref: 195 23) Training should be a continuous process even after the system is live.

Answer: TRUE Diff: 1 Page Ref: 196 24) To be effective, organizations should choose one training format and stick with it.

Answer: FALSE Diff: 3 Page Ref: 196 25) ERP system training should focus on showing users where to point and click in the applications.

Answer: FALSE Diff: 2 Page Ref: 196 26) Training helps users interact with the ERP system while managing helps them understand how their work is related to the processes and people in other departments.

Answer: FALSE Diff: 3 Page Ref: 196 27) Even though it should be conducted just-in-time, training often gets put into the postimplementation schedule because the project schedule gets compressed.

Answer: TRUE Diff: 3 Page Ref: 197 28) During the stabilization process, it is important to initiate all issues and track them to resolution.

Answer: FALSE Diff: 2 Page Ref: 198 29) If the ERP system is turned on for the first time on Monday and sales people cannot login to get their sales report, this would be an example of a stabilization issue that needs to be tracked and debugged.

Answer: FALSE Diff: 2 Page Ref: 198 30) During the stabilization period, the IT staff will be monitoring the phone lines for response times and ensure that appropriate backups are made.

Answer: FALSE Diff: 3 Page Ref: 198 3 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

31) In the parallel implementation approach, the new ERP system is operated concurrently with the competition's.

Answer: FALSE Diff: 2 Page Ref: 198 32) Some ERP system problems can be identified in advance but others can only be identified in real-time use of the system.

Answer: TRUE Diff: 3 Page Ref: 198 33) Post production design is concerned with managing the daily operations of the new ERP system.

Answer: FALSE Diff: 3 Page Ref: 199 34) One problem with running the old legacy system in parallel with the new ERP system is that this can lower the effort and cost required to operate the system.

Answer: FALSE Diff: 2 Page Ref: 199 35) To better understand the effectiveness of the new ERP system, it is important to have key measurement in place after the go-live phase.

Answer: TRUE Diff: 3 Page Ref: 199 36) The first tier of the support process usually involves a help desk or a Call Center.

Answer: TRUE Diff: 2 Page Ref: 200 37) System process questions are usually handled by the vendor experts in the second tier of the support process.

Answer: FALSE Diff: 3 Page Ref: 200 38) Tier three of the support process usually involves a combination of technical staff along with vendor support.

Answer: TRUE Diff: 2 Page Ref: 200 39) After the implementation, data migration must be conducted periodically to ensure that the system is being used correctly and that data entry processes are being followed.

Answer: FALSE Diff: 3 Page Ref: 202

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40) A web-based ________ can be a good way to add support to users during the postimplementation phase.

A) order entry B) FAQ C) module portfolio D) change management document Answer: B Diff: 2 Page Ref: 199 41) As time goes on, existing users and new employees will need continuous ________ on the ERP system.

A) management B) growth C) training D) functional requirements Answer: C Diff: 1 Page Ref: 199 42) Tracking and resolving day-to-day issues with the new ERP system is the job of the: A) technical staff.

B) Steering Committee.

C) Project Management Office.

D) Help Desk.

Answer: D Diff: 2 Page Ref: 199 43) Data validation is mostly accomplished by developing detail ________ that identify data problems within the new system.

A) scenarios B) function modules C) applications D) reports Answer: D Diff: 3 Page Ref: 200 44) The ability to identify and correct bad data will be part of the ________ process.

A) design B) stabilization C) maintenance D) go live Answer: B Diff: 3 Page Ref: 200

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45) When there are large amounts of data that need to be updated, a(n) ________ should be available for this.

A) mass update process B) ETL tool C) data correction protocol D) data scrubbing partner Answer: A Diff: 3 Page Ref: 200 46) It is important that the ERP system ________ as the company grows and changes.

A) develops B) evolves C) decreases in scope D) remains static Answer: B Diff: 1 Page Ref: 200 47) When an employee leaves the company, it is important to take time to address the ________ problem.

A) awareness B) training C) transfer D) configuration Answer: C Diff: 2 Page Ref: 200 48) Knowledge and skill transfer should be an integral part of the ________ plan from day one.

A) integration B) migration C) implementation D) development Answer: C Diff: 2 Page Ref: 200 49) Making sure that users can connect to the production server from their various sites is a measure of ________ readiness.

A) design B) post implementation C) functional D) technical infrastructure Answer: D Diff: 3 Page Ref: 202

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50) In the go live and stabilization phases, the ________ is likely to change.

A) design B) contract C) hardware vendor D) team composition Answer: D Diff: 3 Page Ref: 202 51) The first task of the ________ plan should be monitoring the transition from the one phase to the other, enabling a smooth transfer of knowledge.

A) design B) functional requirements C) knowledge management D) transition E) cut-over Answer: C Diff: 3 Page Ref: 202 52) From the operational perspective, during the definition and build phases, it is important to document the ________ and how they are mapped to the ERP software.

A) legacy systems B) functional requirements C) databases D) business processes Answer: D Diff: 3 Page Ref: 202 53) In the go-live and stabilization phases, the ________ is replaced by the Application COE. A) legacy system B) ERP COE C) database D) business process Answer: B Diff: 3 Page Ref: 202 54) ________ systems help to streamline the process of knowledge and skill transfer.

A) Legacy B) Knowledge management C) Data warehouse D) Skill transfer Answer: B Diff: 3 Page Ref: 203

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55) Having a(n) ________ will eliminate confusion, duplication, and losing data.

A) ETL tool B) ERP system C) centralized data repository D) PMO Answer: C Diff: 2 Page Ref: 203 56) The readiness process must be planned and organized well in advance of the ________ date.

A) go-live B) build C) stabilization D) system transfer Answer: A Diff: 2 Page Ref: 203 57) Because it is likely that key team members will leave during the project, it is important to have a ________ plan in place.

A) functional operation B) changes management C) knowledge transfer D) component mapping Answer: C Diff: 2 Page Ref: 203 58) An elaborate readiness process is considered to a(n): A) process management scenarios.

B) change management prerequisite.

C) "best practice."

D) key project indicator.

Answer: C Diff: 3 Page Ref: 192 59) The time from the go-live date until about 90 days after is known as the ________ period.

A) stabilization B) readiness C) maintenance D) post-support Answer: A Diff: 2 Page Ref: 192

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60) ________ should start during the readiness process and continue through stabilization through to the post production support phase.

A) Assessment B) Training C) Process mapping D) Data migration Answer: B Diff: 2 Page Ref: 193 61) The go live ________ process will clarify the progress towards completing the activities and identify the major issues on which to focus before going live.

A) development B) readiness C) outsourcing D) integration E) data migration Answer: B Diff: 3 Page Ref: 193 62) Go live readiness reviews involve ________ the current metrics related to what remains to be completed.

A) documenting B) purchasing C) outsourcing D) refining Answer: A Diff: 2 Page Ref: 194 63) With the second and subsequent readiness reviews, the ________ should be assessed to see if it is still feasible.

A) statement of intent B) scope document C) go-live date D) functional requirements document Answer: C Diff: 3 Page Ref: 195 64) Training must be provided to the system users using ________ and examples.

A) DVDs B) real data C) applications D) practice systems Answer: B Diff: 2 Page Ref: 195

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65) Most issues during and after an ERP implementation are related to ________ and culture.

A) software B) hardware C) people D) data E) none of the above Answer: C Diff: 2 Page Ref: 196 66) ________ is usually the first activity to be cut when an ERP project goes over budget.

A) Managing B) Consulting C) Designing D) Training E) none of the above Answer: D Diff: 2 Page Ref: 196 67) The ________ process begins when the ERP system software is in production, initial training is complete and conversion of critical data is done.

A) initiation B) stabilization C) implementation D) socialization E) none of the above Answer: B Diff: 3 Page Ref: 197 68) To make sure that it receives adequate funding and room in the project schedule, training should be endorsed by ________ management.

A) senior B) operational C) lower level D) casual E) none of the above Answer: A Diff: 2 Page Ref: 197 69) After the ERP system goes live, the organization will need to shift into a ________ process.

A) initiation B) implementation C) stabilization D) socialization E) all of the above Answer: C Diff: 2 Page Ref: 198 10 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

70) During the stabilization period, subject matter experts should be prepared to help ________ from their departments to learn to use the system.

A) consultants B) users C) attorneys D) vendors E) none of the above Answer: B Diff: 2 Page Ref: 198 71) The stabilization period is characterized by ________ hours, many problems and lots of anxiety.

A) short B) long C) less D) all of the above Answer: B Diff: 1 Page Ref: 198 72) Users may be frustrated with the new ERP system because activities that were simple to do in the old legacy system now seem much ________ in the new system.

A) easier B) faster C) more complex D) cheaper E) none of the above Answer: C Diff: 2 Page Ref: 198 73) Most user problems with the new ERP system are due to a lack of understanding of the system and how business ________ interact with the system.

A) processes B) people C) data D) software E) all of the above Answer: A Diff: 3 Page Ref: 200

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74) Basic problems, such as password problems or user access, are usually handled by the ________ tier of the support process.

A) top B) executive C) attorney D) first E) none of the above Answer: D Diff: 1 Page Ref: 200 75) The help desk will enlist the support of ________ to help users across the organization.

A) consultants B) key users C) executives D) consultants E) none of the above Answer: B Diff: 2 Page Ref: 201 76) Why is training so important for ERP implementations? What are some of the ways it can be delivered?

Answer: Because implementing a new ERP system involves so many different changes to jobs and processes users must have extensive training in the system using real data and examples.

This training should extend throughout the project and beyond the go live as new functions are added and new employees are hired. Ironically, training is one of the first things to be cut when a project goes over budget. Besides delivering training with an instructor in a classroom face-toface, it can be done via DVDs, videos, and on-line or using web-based technologies.

Diff: 2 Page Ref: 195 77) What is the difference between ERP training and education? What is the cause of most of the issues in ERP implementations?

Answer: Training has to do with the technical operation of the ERP system. Education is more about why users do certain things when they use the ERP system. It is especially important to educate users about how their actions impact other people involved in the process. For example, they need to know how important it is to carefully enter data since it can hurt later functions if their data is bad. And as it turns out, most ERP issues center on people and cultural issues within the organization. Changing and preventing these issues requires serious education.

Diff: 2 Page Ref: 196

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78) What is the stabilization process? Why is it so critical?

Answer: The stabilization process begins when the ERP system is in production, training has begun, and the conversion of critical data is done. So when the ERP system goes live, the organization has to shift to the stabilization process. This process usually takes from 60 to 90 days as the number of reported issues with the system steadily decreases. As these bugs arise they should be tracked all the way to resolution. It is normal for many issues with the new system to arise as users become used to the new system and processes. This is a critical period for the new system because users may get very frustrated with it and IT staff may be thoroughly exhausted as they try to run both the new and the old systems.

Diff: 2 Page Ref: 197 79) Describe some of the typical user issues and activities that may arise during the stabilization period.

Answer: Some problems may arise with respect to any customizations that have been done to the new system. Oftentimes these are not documented or communicated to the users well and this can lead to problems. Users will also have to learn how to use the system to perform ad-hoc activities as they arise. In the past, they probably came up with work-arounds in order to get their job done, but haven't had the time to do this with the new system. The processes themselves will be new to the users and they will need to get used to them. There may also be confusion surrounding the old system and the new one since they may be run in parallel during the stabilization period.

Diff: 2 Page Ref: 198 80) What is the post product support phase? Describe some of the activities that must occur here.

Answer: After the go-live and stabilization phase there is the post production support phase. If this process is inadequate, the new system may still be considered to be a failure. It is necessary to manage the daily operations of the new system and validate how the system is being used. It may not be used correctly or efficiently and key metrics need to be in place to check whether the new system is adding value to the business as a whole. There will be a number of different tiers in the support process depending on the severity of the bugs that are found.

Diff: 3 Page Ref: 199 81) Describe the three tiers of the typical support process.

Answer: The first tier is the Help Desk or Call Center. This group is on the front line and helps to diagnose the severity of the problem. They will handle straight-forward problems such as users having trouble with their passwords or navigating the new system. If they can't handle the problem, it will be escalated to Tier 2 support. This is where the subject matter experts are used.

They will usually handle questions about process integration and data flow in the new system. If the tier 2 SMEs can't handle the issue, it is escalated to Tier 3 support which may be a combination of technical staff with vendor support staff. These problems may require considerable research and patching to fix.

Diff: 2 Page Ref: 200

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82) What is knowledge transfer and why is it important for ERP implementations?

Answer: Because ERP systems are so knowledge intensive, it is important that those who are expert in using the system be prepared to transfer their knowledge to the rest of the organization.

It is safe to assume that some people will leave during the project and may be taking crucial knowledge of the processes and the new system. Also, if many external consultants are involved it is crucial to transfer their knowledge to IT staff and users as much as possible. All of this should be explicitly spelled out in the knowledge management plan.

Diff: 2 Page Ref: 201 83) How does an organization know when it is ready to go live with the new ERP system?

Answer: A special readiness process should be in place before the go-live date. This process will help identify issues that need attention as the go-live date approaches. There will usually be at least readiness assessments before go live and they will assess the infrastructure, development, configuration, conversion, testing, training, operations, reporting and users. The results of the assessment will be communicated to top management and project team members and then it will be determined whether the go live date can be met.

Diff: 2 Page Ref: 202

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 8 Program and Project Management 1) Most ERP project teams are made up of a variety of staff and consultants.

Answer: TRUE Diff: 1 Page Ref: 227 2) ERP project team members don't need to have functional or technical expertise in a specific area.

Answer: FALSE Diff: 2 Page Ref: 227 3) The Steering Committee is responsible for ensuring that project teams are working well together.

Answer: FALSE Diff: 2 Page Ref: 227 4) The PMO needs to make certain that team activities stay synchronized and that progress is being made.

Answer: TRUE Diff: 1 Page Ref: 227 5) The skill set of an ERP project manager must be varied and robust.

Answer: TRUE Diff: 1 Page Ref: 227 6) A program manager should be focused on tactical areas of the ERP implementation.

Answer: FALSE Diff: 3 Page Ref: 228 7) The PMO will regularly address the critical success factors and how they relate to the decision processes.

Answer: TRUE Diff: 2 Page Ref: 228 8) Project management and program management basically refer to the same thing.

Answer: FALSE Diff: 2 Page Ref: 228 9) Project management is focused on strategic goals.

Answer: FALSE Diff: 2 Page Ref: 228 10) ERP implementations often consist of several projects simultaneously.

Answer: TRUE Diff: 2 Page Ref: 228 1 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

11) The primary goal of an ERP system should be to upgrade existing legacy systems to a more robust ERP system.

Answer: FALSE Diff: 2 Page Ref: 229 12) It is the role of the program manager to keep all the projects moving in the same direction to achieve the overall goals of the business.

Answer: TRUE Diff: 1 Page Ref: 229 13) Program management is the responsibility of the Project Director.

Answer: TRUE Diff: 1 Page Ref: 230 14) As long as a project leader is an important technical or functional contributor for the project, good communication skills are not necessary.

Answer: FALSE Diff: 2 Page Ref: 230 15) Module experts convert business requirements into solutions within the ERP system.

Answer: TRUE Diff: 2 Page Ref: 230 16) SMEs usually have a good understanding of the main components involved in an ERP implementation.

Answer: FALSE Diff: 3 Page Ref: 230 17) Most module experts are project driven.

Answer: TRUE Diff: 2 Page Ref: 230 18) Leading ERP projects is a very risky but rewarding activity.

Answer: TRUE Diff: 1 Page Ref: 231 19) Hiring skilled ERP staff is not a problem for most ERP implementations.

Answer: FALSE Diff: 2 Page Ref: 232 20) It is best to have a single work location for an ERP project team.

Answer: TRUE Diff: 2 Page Ref: 232 21) The goal of the technical staff is to ensure that the ERP system works as defined.

Answer: FALSE Diff: 3 Page Ref: 232 2 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

22) The technical leader should be well-versed in the technology but not necessarily in how to manage projects.

Answer: FALSE Diff: 2 Page Ref: 232 23) It is important that the PMO manage the expectations of senior management and communicate the progress of the project.

Answer: TRUE Diff: 1 Page Ref: 232 24) Staff turnover is usually not a problem for ERP projects.

Answer: FALSE Diff: 2 Page Ref: 232 25) Staff who are not on the project may not want the new system and actively work to undermine its success.

Answer: TRUE Diff: 2 Page Ref: 233 26) It is normal in an ERP project that there are always agreements about how to use the system and other issues.

Answer: FALSE Diff: 1 Page Ref: 233 27) If decisions about the ERP system are communicated properly it may be difficult to get buyin on the new system from the users.

Answer: FALSE Diff: 3 Page Ref: 233 28) The ERP project deliverables are part of the project scope.

Answer: TRUE Diff: 2 Page Ref: 233 29) Never changing the parameters in the original project goals can lead to scope creep.

Answer: FALSE Diff: 2 Page Ref: 234 30) Relying solely on internal IT personnel is likely to slow down the ERP project.

Answer: TRUE Diff: 2 Page Ref: 235 31) Outside ERP hardware are often used because they don't work for the software vendor or work for the organization implementing the ERP system.

Answer: FALSE Diff: 3 Page Ref: 235

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32) Outside consultants must be integrated with internal IT personnel on project teams in order to realize the benefits of software transfer.

Answer: FALSE Diff: 3 Page Ref: 235 33) It is very important that the executive sponsor speak at the project completion meeting about how important the project is for the organization as a whole.

Answer: FALSE Diff: 2 Page Ref: 235 34) If some ERP functionality does not work well, there may need to be a change to the original project scope.

Answer: TRUE Diff: 2 Page Ref: 236 35) Change control is how changes are managed through a change process and governance.

Answer: TRUE Diff: 3 Page Ref: 236 36) Scope creep can quickly lead to missed deadlines and project budget savings.

Answer: FALSE Diff: 2 Page Ref: 236 37) The hiring and selecting of competent staff will ensure the go live is smooth and the system is sustainable.

Answer: TRUE Diff: 1 Page Ref: 237 38) ERP implementations require teamwork and a low level of trust also.

Answer: FALSE Diff: 2 Page Ref: 237 39) Senior management must remain committed to the project through every phase and must show their commitment.

Answer: TRUE Diff: 2 Page Ref: 237 40) If the project scope changes then this means that the resources or time will also need to change.

Answer: FALSE Diff: 3 Page Ref: 227

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41) The ________ needs to make certain that the project team activities stay synchronized and that progress is being made.

A) partners B) users C) PMO D) change management team Answer: C Diff: 2 Page Ref: 227 42) The PMO must balance the project ________, resources and time.

A) functions B) growth C) technical requirements D) scope Answer: D Diff: 2 Page Ref: 227 43) Not only should a project manager be able to address issues related to how the system works, but he must be ________ savvy.

A) marketing B) design C) politically D) financially Answer: C Diff: 2 Page Ref: 228 44) Program management and project management are often used ________ but actually refer to two different things.

A) casually B) interchangeably C) progressively D) interactively Answer: B Diff: 1 Page Ref: 228 45) Project management is ________ focused while program management is strategically focused.

A) functionally B) operationally C) historically D) tactically Answer: D Diff: 3 Page Ref: 228

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46) The program manager must ________ all the different projects and make sure the overall business goals are being met.

A) outsource B) link C) use D) offshore Answer: B Diff: 1 Page Ref: 228 47) In the program management model, the ________ manager manages across multiple functional projects.

A) development B) PMO C) program D) project Answer: C Diff: 2 Page Ref: 229 48) When a company decides to implement an ERP system, a(n) ________ must be created that outlines the business goals to be achieved.

A) awareness B) position paper C) business case D) white paper E) committee Answer: C Diff: 2 Page Ref: 229 49) Increased market share is an example of a possible ________ that might justify implementing an ERP system.

A) business goal B) project C) CSF D) process driver Answer: A Diff: 2 Page Ref: 229 50) The PMO will probably report to the Project Executive and the: A) vendor team.

B) change management office.

C) owners.

D) Steering Committee.

Answer: D Diff: 3 Page Ref: 230

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51) The PMO must be constantly evaluating ________, managing resources and the project schedule.

A) software B) risks C) vendors D) hardware Answer: B Diff: 2 Page Ref: 230 52) The PMO will also have to make sure that ________ are in key positions.

A) salespeople B) individual contributors C) team players D) executives Answer: C Diff: 3 Page Ref: 230 53) If a(n) ________ is in a leadership position, this will increase project risks and create problems within the team.

A) team player B) manager C) SME D) individual contributor Answer: D Diff: 3 Page Ref: 230 54) In order to increase teamwork and productivity, it may be necessary to have ________ in how to conduct effective meetings.

A) examples B) training C) books D) lectures Answer: B Diff: 1 Page Ref: 230 55) The ________ are responsible for analyzing business requirements and converting them into solutions with the ERP system.

A) design experts B) SMEs C) module experts D) consultants Answer: C Diff: 3 Page Ref: 230

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56) The ________ have specific knowledge about one or more of the business processes and help to coordinate and prioritize the different functional requirements of the new system.

A) SMEs B) project team members C) module experts D) functional experts Answer: A Diff: 3 Page Ref: 230 57) The ________ understand the ERP functionality and will make the new system do what it is supposed to do.

A) SMEs B) project team members C) module experts D) functional experts Answer: C Diff: 2 Page Ref: 230 58) Because SMEs usually only understand a small component of the ERP implementation, they will need to be trained on project process and: A) functions.

B) changes.

C) modules.

D) methodology.

Answer: D Diff: 3 Page Ref: 231 59) SMEs will have a hard time understanding how the new system is going to work until they see ________ flow through the system.

A) process management scenarios B) their own data C) the system upgrades D) data migration Answer: B Diff: 3 Page Ref: 231 60) ERP projects typically have high risks but also: A) high rewards.

B) high ROI. C) long payback periods.

D) easy go-live phases.

Answer: A Diff: 2 Page Ref: 231

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61) Because they may have to look outside the company for skilled ERP consultants, the project ________ may depend on when the key staff are in place.

A) training B) go live date C) start date D) stabilization Answer: C Diff: 2 Page Ref: 231 62) It is important that the project team has a ________ to work together.

A) team wiki B) single location C) project leader D) project web site E) central data repository Answer: B Diff: 2 Page Ref: 231 63) The goal of the ________ is to make sure the new system works as it was defined.

A) functional staff B) PMO C) technical staff D) Steering Committee Answer: A Diff: 2 Page Ref: 232 64) When a key project member leaves in the middle of the project, it is important that there is a process in place to transfer their ________ to their replacement.

A) files B) scope document C) knowledge D) functional requirements document Answer: C Diff: 2 Page Ref: 232 65) In order to minimize the destructive effects of poor communication and backbiting behavior, a PMO must ensure that project teams are ________ for decisions and directions they take.

A) dissolved B) changed C) accountable D) compensated Answer: C Diff: 3 Page Ref: 233

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66) There will always be second guessing of ________ made by project members. This can be very harmful to the success of the ERP project.

A) attorneys B) executives C) consultants D) decisions E) none of the above Answer: D Diff: 2 Page Ref: 233 67) Because of the integrated nature of ERP systems, having good ________ is one of the most important factors in successful projects.

A) attorneys B) executives C) teamwork D) consultants E) all of the above Answer: C Diff: 2 Page Ref: 234 68) Because people often have a fear of the unknown, it is normal for them to ________ the changes brought by a new ERP system.

A) embrace B) encourage C) accept D) resist E) all of the above Answer: D Diff: 2 Page Ref: 235 69) One important way of calming users' fears is with an aggressive ________ program.

A) training B) replacement C) layoff D) vacation E) none of the above Answer: A Diff: 2 Page Ref: 235

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70) Changes in project scope or new functionality are often addressed through the research and development of a ________.

A) new system B) white paper C) consulting company D) new organizational structure E) none of the above Answer: B Diff: 3 Page Ref: 236 71) Many projects fail because of a lack of ________ throughout the project.

A) communication B) hardware C) consultants D) data E) all of the above Answer: A Diff: 2 Page Ref: 236 72) ERP projects often take a few ________ to implement so top management may forget some of the key benefits of the system.

A) days B) months C) years D) decades E) none of the above Answer: C Diff: 3 Page Ref: 237 73) Too many changes to the system can slow down the project and bring it ________.

A) under budget B) to a quick completion C) to the vendors D) to a standstill E) none of the above Answer: D Diff: 2 Page Ref: 227 74) In addition to having functional and technical skills, each team member must understand the importance of ________.

A) teamwork B) the hardware C) the software D) the data E) none of the above Answer: A Diff: 2 Page Ref: 227 11 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

75) The ________ must manage the project scope, resources and schedule.

A) attorneys B) PMO C) consultants D) IT staff E) none of the above Answer: B Diff: 2 Page Ref: 227 76) What is the role of the PMO in an ERP project?

Answer: The PMO or Project Management Office is responsible for ensuring that project teams are working well together and addressing the functionality issues in a timely, open and efficient manner. The PMO has the difficult task of managing the limited resources, the project scope, and the project schedule. It is a risky but rewarding role in ERP projects.

Diff: 2 Page Ref: 227 77) What skills should a good project manager have?

Answer: A successful ERP project manager should be flexible, disciplined, a quick learner, a good decision maker, have ERP and business experience, have political clout with a formal education, be well liked, and be able to motivate the staff. They will have to be able to recognize team players as opposed to those who are more interested in their own personal advancement.

Diff: 2 Page Ref: 230 78) What is "program management" and how is it different from the idea of project management?

Answer: While these two terms are often used interchangeably, they are actually quite different.

Because ERP implementations consist of many different projects it is important to have a separate program manager to help coordinate them all and to make sure they are meeting the overall goals of the business. The program manager will also have to keep track of projects that are ongoing, but not necessarily a part of the ERP implementation. The program manager will also be more strategically focused as opposed to the tactical focus of each project manager.

Diff: 2 Page Ref: 228 79) Why do ERP projects often take longer to get started than anticipated?

Answer: At the beginning of an ERP project, it is difficult to know how long it will take to find the right outside consultants needed for the project. Because skilled people are in high demand, even if the right people can be found, it is most likely that they are already assigned to a project and so this may hold back the start up date. Another thing that may hold back the project is that the project team should have a dedicated single location to work in, and it should be well designed to support open communication and collaboration. In some companies this may be especially difficult to find.

Diff: 2 Page Ref: 232

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80) What does an SME do? Why are they so crucial for the success of an ERP project?

Answer: The SMEs coordinate and prioritize the functional requirements. They are the ones who have deep knowledge of how specific processes need to be done in the organization. The SMEs are crucial to a project because they will provide an example to the rest of the users, so if they understand the project and how it works and communicate it well to their colleagues this will go a long way to reduce users' anxiety and increase productivity.

Diff: 3 Page Ref: 230 81) What does a module expert do? Why are they so crucial for the success of an ERP project?

Answer: A module expert has deep knowledge of how the ERP software works. They are responsible for analyzing the functional requirements and converting them into solutions within the specific ERP package being used. They are crucial because they help the other team members know what is possible to do during the process redesign, configuration, testing, training and implementation of the new system.

Diff: 3 Page Ref: 230 82) Why is it so important to have a knowledge transfer process in place?

Answer: It is almost a certainty that key people will leave in the middle of the ERP implementation so in order to make sure the project is not delayed too long, it is important that there is a process in place in advance. This will make it easier for the person who is leaving to train the new person who rolls onto the project to take his/her place. The new person will have to learn about the project methodology, team composition, status, and how they will fit into the project structure. In addition, they will need to learn the specifics of what has been done in their team to date. If this process is not in place, this can put the project way behind schedule.

Diff: 2 Page Ref: 232 83) Why is it so important to have a decision making process in place?

Answer: In most projects it is inevitable that there will be disagreements. These may center on how the system will be used, what modifications should be made, the reports needed and how the data will be converted. How and why the eventual decisions are made on these issues must be understood by the teams. Otherwise, they will lose faith in the process and morale will decline and it will be difficult to get their buy-in for key changes.

Diff: 3 Page Ref: 233 84) What are the keys to a successful change management process?

Answer: Communication and training are the keys to a successful change management effort.

People are often frightened by rumors about impending changes and so they often resist ERP implementations. Just knowing that they will be trained extensively in the new system alone can make a huge difference in their attitude towards it. The project manager must be sensitive to the concerns of the average user.

Diff: 2 Page Ref: 235

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 9 Organizational Change and Business Process Reengineering 1) A successful ERP implementation requires organizational change.

Answer: TRUE Diff: 1 Page Ref: 244 2) The FoxMeyer ERP implementation failed because they didn't train their employees properly on the new system.

Answer: FALSE Diff: 2 Page Ref: 244 3) BPR identifies current processes and the change required "best practices."

Answer: TRUE Diff: 2 Page Ref: 244 4) The OPM3 is used to provide a framework for the ERP system's infrastructure.

Answer: FALSE Diff: 3 Page Ref: 244 5) ERP implementations can use the existing organization and reporting structure.

Answer: FALSE Diff: 3 Page Ref: 244 6) Under normal circumstances, teamwork can take a number of years to develop, but it is especially important in an ERP project.

Answer: TRUE Diff: 1 Page Ref: 244 7) A merger or acquisition usually entails some kind of organizational change.

Answer: TRUE Diff: 2 Page Ref: 244 8) Adding a new employee is an example of organizational change.

Answer: FALSE Diff: 2 Page Ref: 245 9) Organizational change refers to a fundamental and radical reorientation in the way the organization operates.

Answer: TRUE Diff: 1 Page Ref: 245 10) ERP implementations often involve only minor changes to the organization.

Answer: FALSE Diff: 2 Page Ref: 245

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11) In most cases, an ERP system will immediately increase profits and provide a short term return on investment.

Answer: FALSE Diff: 3 Page Ref: 245 12) A BPR study should set the stage for the actual ERP implementation.

Answer: TRUE Diff: 2 Page Ref: 245 13) Legacy systems are built around the idea of "best practices."

Answer: FALSE Diff: 2 Page Ref: 245 14) Senior management doesn't need to commit to the ERP project until it is near the go-live phase.

Answer: FALSE Diff: 1 Page Ref: 245 15) A well-defined communication plan is a key component of change management.

Answer: TRUE Diff: 2 Page Ref: 246 16) The OPM3 is used to assess an organization's experience in implementing an ERP system.

Answer: TRUE Diff: 3 Page Ref: 246 17) Less skilled companies can raise their ERP skills by training employees or hiring external consultants.

Answer: TRUE Diff: 2 Page Ref: 246 18) The OPM3 is a five step continuous improvement process.

Answer: FALSE Diff: 1 Page Ref: 246 19) Assessment is the last step of the OPM3 process.

Answer: FALSE Diff: 2 Page Ref: 247 20) Determining the appropriate best practices is part of the knowledge phase of the OPM3.

Answer: TRUE Diff: 3 Page Ref: 247 21) BPR is often used as the main reason for moving from legacy systems to an ERP system.

Answer: TRUE Diff: 2 Page Ref: 246 2 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

22) A business process is defined as "a set of logically related tasks performed to achieve a defined business outcome."

Answer: TRUE Diff: 1 Page Ref: 247 23) Reengineering can be traced back to the 1700s.

Answer: FALSE Diff: 1 Page Ref: 247 24) The first step in the BPR methodology is to define the "as is" process.

Answer: FALSE Diff: 3 Page Ref: 248 25) Sometimes the ERP system is not purchased until after the "to be" processes are defined and communicated.

Answer: TRUE Diff: 3 Page Ref: 248 26) BPR with an ERP implementation requires crossing organizational levels.

Answer: FALSE Diff: 2 Page Ref: 248 27) The "to be" processes are the same as the existing processes.

Answer: FALSE Diff: 2 Page Ref: 249 28) In the "to be" phase some processes will be redesigned and some will be eliminated.

Answer: TRUE Diff: 2 Page Ref: 249 29) In the "as is" phase, all the new processes must have estimates of timing and who is responsible.

Answer: FALSE Diff: 3 Page Ref: 249 30) Almost all ERP systems are slow and can be adjusted to meet organizational vision and goals.

Answer: FALSE Diff: 2 Page Ref: 249 31) The BPR organizational structure must coincide with the project governance.

Answer: FALSE Diff: 3 Page Ref: 252 32) ERP implementation project CEOs are created just for the project.

Answer: FALSE Diff: 2 Page Ref: 252 3 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

33) The development of the project team is the responsibility of the CEO along with leads in each area.

Answer: FALSE Diff: 2 Page Ref: 246 34) The only way to tell whether a project is on schedule is by using project measurements.

Answer: TRUE Diff: 2 Page Ref: 246 35) Project leads provide input to management and coordinate team activities.

Answer: TRUE Diff: 2 Page Ref: 246 36) A BPM process category is software-intensive processes.

Answer: FALSE Diff: 3 Page Ref: 252 37) A BPM process category is people-intensive processes.

Answer: TRUE Diff: 3 Page Ref: 252 38) A BPM process category is decision-intensive processes.

Answer: TRUE Diff: 3 Page Ref: 252 39) A BPM process category is hardware-intensive processes.

Answer: FALSE Diff: 3 Page Ref: 252 40) In the process of identifying and prioritizing reports from the old system, some of them may be eliminated altogether.

Answer: TRUE Diff: 2 Page Ref: 246 41) The ________ manages the day-to-day aspects of the project.

A) Steering Committee B) Super User C) Project Manager D) change management team Answer: C Diff: 1 Page Ref: 246

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42) The Project Executive must oversee project activities and provide broad ________ for the project and resolve policy level issues.

A) functions B) growth C) technical requirements D) oversight Answer: D Diff: 2 Page Ref: 246 43) The overall policy, budget, and scope of the project are determined by the: A) PMO. B) owners.

C) Steering Committee.

D) Project Executive.

Answer: B Diff: 2 Page Ref: 246 44) The BPR methodology starts with ________ the first step.

A) testing B) mapping C) definition D) reevaluation E) preparation Answer: E Diff: 2 Page Ref: 248 45) The BPR methodology continues to the second step ________.

A) testing B) mapping C) definition D) reevaluation E) preparation Answer: C Diff: 2 Page Ref: 248 46) The BPR methodology continues to the third step ________.

A) testing B) mapping C) definition D) reevaluation E) preparation Answer: B Diff: 2 Page Ref: 248

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47) The BPR methodology continues to the fourth step ________.

A) testing B) mapping C) definition D) reevaluation E) preparation Answer: A Diff: 2 Page Ref: 248 48) The BPR methodology continues to the fifth step ________.

A) testing B) mapping C) definition D) reevaluation E) preparation Answer: D Diff: 2 Page Ref: 248 49) ________ is a methodology for assessing whether an organization has the skills in place to successfully implement an ERP system.

A) BPR B) Business blueprinting C) CSF D) OPM3 Answer: D Diff: 2 Page Ref: 246 50) Within an ERP project, ________ requires crossing organizational boundaries and a more extensive change management effort because of the high anxiety towards it by the workforce.

A) BPR B) Business blueprinting C) CSF D) OPM3 Answer: A Diff: 3 Page Ref: 260 51) Resistance to change may be high but can be reduced with a significant ________ effort early and often in the project.

A) development B) risk management C) change management D) functional management Answer: C Diff: 2 Page Ref: 260

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52) Over the years, ________ has been equated with downsizing in ERP projects.

A) BPR B) Business blueprinting C) CSF D) OPM3 Answer: A Diff: 3 Page Ref: 260 53) With a new ERP system, not only do workers fear a loss or change in their jobs, but they also fear an overall change in the: A) organization.

B) management.

C) control structure.

D) business process.

Answer: C Diff: 3 Page Ref: 260 54) In the FoxMeyer case, at a high level, they failed to develop a(n) ________ for the change that came with their ERP implementation.

A) example B) training C) business case D) presentation Answer: C Diff: 2 Page Ref: 244 55) The OPM3 consists of three stages or steps:________, assessment, and improvement.

A) design B) training C) conversion D) knowledge Answer: D Diff: 3 Page Ref: 244 56) Having a strong sense of ________ will help provide continuity and a basis for moving forward as decisions are made and business processes change.

A) participation B) teamwork C) commitment D) functionality Answer: B Diff: 3 Page Ref: 244

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57) ERP implementations require their own organizations and ________ structure.

A) marketing B) accounting C) reporting D) staffing Answer: C Diff: 3 Page Ref: 244 58) A change in the ________ would be an example of an organizational change.

A) building security B) departmental staff C) mission D) marketing literature Answer: C Diff: 2 Page Ref: 244 59) Half of all ERP projects fail to deliver all the anticipated benefits because they do not do a good job of: A) blueprinting.

B) managing change.

C) training users.

D) data migration.

Answer: B Diff: 3 Page Ref: 244 60) BPR studies not only identify process and procedural changes for the business, but also ________ that can create industry advantages.

A) high rewards B) high ROI opportunities C) best practices D) case studies Answer: C Diff: 3 Page Ref: 245 61) Two factors that help ensure organizational commitment to the ERP project include the OPM3 process and a ________ plan.

A) training B) go live C) communication D) stabilization Answer: C Diff: 2 Page Ref: 246

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62) The objective of ________ is to minimize the risk of failure and maximize the benefits of the change.

A) ERP projects B) change management C) communication D) project management Answer: B Diff: 2 Page Ref: 246 63) The goal of the ________ process is to measure whether the organization has the skills and experience necessary to implement an ERP system.

A) OPM3 B) PMO C) BPR D) staffing analysis Answer: A Diff: 2 Page Ref: 246 64) To fully utilize the new ERP system, the ________ results need to be incorporated into the ERP implementation scope and plan.

A) blueprinting B) functional analysis C) OPM3 D) BPR Answer: D Diff: 3 Page Ref: 247 65) In order to reengineer a business process, it must be first dismantled into individual ________ and then put back together into a new set of business flows.

A) functions B) activities C) transactions D) data flows Answer: B Diff: 2 Page Ref: 247 66) BPR is often equated with ________.

A) leadership B) status quo C) downsizing D) stealing E) none of the above Answer: C Diff: 2 Page Ref: 248

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67) BPR teams will be composed of functional users and ________ along with facilitators.

A) managers B) attorneys C) consultants D) IT Staff E) none of the above Answer: A Diff: 3 Page Ref: 248 68) Working through the as is phase of the BPR process is often tedious and stressful, so it is good to counter this with ________ and events.

A) conferences B) team building exercises C) meetings D) vacation E) none of the above Answer: B Diff: 3 Page Ref: 249 69) The "to be" phase is ________ difficult than the "as is" phase.

A) more B) less C) equally as D) none of the above Answer: A Diff: 2 Page Ref: 249 70) Some team members will be ________ by the idea of changing a process.

A) fired B) prompted C) threatened D) dumb founded E) none of the above Answer: C Diff: 1 Page Ref: 249 71) Some BPR tools are ________ while others address certain market niches.

A) expensive B) cheap C) comprehensive D) stylish E) none of the above Answer: C Diff: 1 Page Ref: 250

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72) Functional and technical staff on the ERP implementation project should report to ________ rather than their home departments.

A) attorneys B) consultants C) executives D) project leads E) none of the above Answer: D Diff: 3 Page Ref: 252 73) Sample BPM vendors include: A) Adobe.

B) EMC. C) IBM. D) Oracle.

E) all of the above Answer: E Diff: 3 Page Ref: 253 74) Benefits of implementing BPM include: A) employees work longer hours.

B) smooth business operations.

C) low efficiency reduces costs.

D) employees don't feel worse off.

E) none of the above Answer: B Diff: 2 Page Ref: 257 75) The benefits of BPM are driven by the Four R's of Process: A) Roles, Relationships, Revenue, Routing.

B) Rules, Relationships, Revenue, Routing.

C) Roles, Rules, Revenue, Routing.

D) Roles, Relationships, Rules, Routing.

E) none of the above Answer: D Diff: 2 Page Ref: 258 76) Why is change management so import for ERP projects?

Answer: As illustrated by the FoxMeyer case, ERP is not simply about automating existing business processes, but it is about reengineering processes with technology in mind. This often requires organizational change to take advantage of the new integrated systems. Change management is needed to get the company ready for the coming changes and to take advantage of them.

Diff: 2 Page Ref: 244

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77) What is the OPM3 framework? How is it used in ERP projects?

Answer: OPM3 stands for Organizational Project Management Maturity Model. This long name says it all, as this is a tool that organizations can use to measure how much expertise they have in implementing ERP systems. This assessment would form the basis for doing a gap analysis to see how much external staffing they will need in order to be successful.

Diff: 2 Page Ref: 245 78) Why is BPR often equated with downsizing?

Answer: BPR or Business Process Reengineering has gotten the reputation over the years as simply a vehicle for eliminating jobs. Employees fear that many of their jobs will be changed and possibly eliminated. While it is true that job descriptions and tasks may change, oftentimes the most tedious tasks are automated and employees are actually freed up to do more interesting jobs with more decision-making input. To avoid some of these fears, it is most important that employees get training early on and that the implementation process be communicated well.

Diff: 2 Page Ref: 248 79) What is organizational change? Give some examples.

Answer: Organizational change is sometimes equated with organizational transformation. In other words, this term is referring to some kind of fundamental or radical reorientation in the way the organization operates. Some examples could be restructuring the organization, changing the mission, merging with another organization, and reengineering core processes.

Diff: 1 Page Ref: 244 80) What does a BPR study do?

Answer: A BPR study helps supply the rationale for implementing an ERP system. It identifies the process and procedural changes needed to streamline the business. It may also identify some best practices that can be used as a basis for gaining a competitive advantage in that industry. In this sense, it helps set the stage for the whole ERP project.

Diff: 3 Page Ref: 247 81) What are the steps in the OPM3 process?

Answer: As specified by the Project Management Institute (PMI), the three steps of the OPM3 process include knowledge, assessment, and improvement. In the knowledge step, the team learns about the available best practices and gains an understanding of how they fit in the implementation. Then an assessment is performed to see what the current state of the organizational project management skills is as compared with the best practices identified in the first step. Once the skills have been assessed, then a plan has to be made to improve any areas where gaps in skills have been identified. This model can be repeated as needed.

Diff: 3 Page Ref: 246

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82) What are the steps in the BPR process?

Answer: BPR can be broken down into five basic steps. The first involves getting prepared for BPR by outlining the scope and goals for the BPR process. Then the as is processes are identified and defined and any cross-organizational issues they may present. Once this is done the to be processes are mapped out possibly using the best practices as a guide. The new processes are then tested and measured to see how well they meet the goals. Finally, the processes are reevaluated with an eye to possible improvements.

Diff: 3 Page Ref: 248 83) What tools are available for supporting BPR? Answer: There is a growing list of tools on the market today that are designed to make BPR easier and more efficient. These software packages help the team to analyze the dynamics of existing processes and can provide greater insight into how well the redesigned processes meet the project goals. Some packages are more comprehensive than others and have support for all phases of the BPR process.

Diff: 3 Page Ref: 220 84) What are the main areas of the ERP project organizational structure?

Answer: The main group or area would certainly be the Project Management Office or PMO. This group will consist of the project executive, project managers, project schedulers, and administrative staff. The next main area would be the leads of the various project teams. This would include the functional teams, the change management team, the development team, the conversion team, reporting team, testing team, and the infrastructure team. Lastly there are the actual members of each of these different teams.

Diff: 3 Page Ref: 246

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 10 Global, Ethics, and Security Management 1) Outsourcing ERP systems helps to lower the cost of software ownership and maintenance.

Answer: TRUE Diff: 1 Page Ref: 268 2) All companies can benefit from outsourcing their ERP systems.

Answer: FALSE Diff: 2 Page Ref: 268 3) One reason that outsourcing lowers costs is because it doesn't require any oversight.

Answer: FALSE Diff: 2 Page Ref: 268 4) Enterprise systems can change the ethical and legal environment of the organization.

Answer: TRUE Diff: 1 Page Ref: 268 5) Because of their extensive integration, ERP systems are less susceptible to security hazards.

Answer: FALSE Diff: 2 Page Ref: 268 6) Outsourcing occurs when a company decides to sub-contract its business processes or functions to another company.

Answer: TRUE Diff: 1 Page Ref: 268 7) Outsourcing ERP systems has been done by organizations worldwide.

Answer: TRUE Diff: 2 Page Ref: 268 8) Initially, most IT outsourcing focused on software training.

Answer: FALSE Diff: 2 Page Ref: 269 9) The Y2K problem provided a huge boost to the practice of IT outsourcing.

Answer: TRUE Diff: 2 Page Ref: 269 10) Outsourcing IT functions is cost effective but decreases flexibility.

Answer: FALSE Diff: 2 Page Ref: 269 11) Front-office IT functions generally include system development and maintenance.

Answer: FALSE Diff: 2 Page Ref: 269 1 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

12) One benefit of outsourcing an ERP system is that it has a predictable monthly payment.

Answer: TRUE Diff: 2 Page Ref: 268 13) Back office IT functions typically involve customer interactions.

Answer: FALSE Diff: 2 Page Ref: 268-9 14) Outsourcing gives organizations access to a broader set of key IT skills.

Answer: TRUE Diff: 1 Page Ref: 268-9 15) It is difficult to add more hardware resources when the ERP system is outsourced.

Answer: FALSE Diff: 3 Page Ref: 268-9 16) Outsourcing by its very nature forces a more process-oriented perspective on the company.

Answer: TRUE Diff: 3 Page Ref: 268-9 17) ERP systems don't require a high amount of maintenance.

Answer: FALSE Diff: 2 Page Ref: 271 18) ERP outsourcing is more common that IT outsourcing in general.

Answer: FALSE Diff: 2 Page Ref: 271 19) Misunderstandings often occur between the outsourcer and the organizations.

Answer: TRUE Diff: 2 Page Ref: 271 20) One benefit of outsourcing is that there are no unexpected costs.

Answer: FALSE Diff: 3 Page Ref: 271 21) Outsourcing operations means that a company might have to share their trade secrets.

Answer: TRUE Diff: 2 Page Ref: 271 22) Outsourcing is the same as offshoring.

Answer: FALSE Diff: 1 Page Ref: 271 23) Over half of all offshoring IT spending is in India.

Answer: FALSE Diff: 2 Page Ref: 272 2 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

24) Collocating team members is not cost effective in global ERP implementations.

Answer: TRUE Diff: 2 Page Ref: 272 25) Offshoring ERP development helps make change management easier.

Answer: FALSE Diff: 3 Page Ref: 272 26) Offshoring can be difficult because firms in different countries have the same local requirements.

Answer: FALSE Diff: 2 Page Ref: 272 27) Companies in developing countries may have less mature operational models.

Answer: TRUE Diff: 2 Page Ref: 272 28) Completely localizing an ERP system decreases complexity and customization, while defeating the purpose of a global solution.

Answer: FALSE Diff: 3 Page Ref: 273 29) Companies must be careful to perform due diligence when selecting an outsourcing vendor.

Answer: TRUE Diff: 2 Page Ref: 273 30) Many developing countries do not have strong intellectual property laws to protect your firm's ideas from being stolen by an outsourcing vendor.

Answer: TRUE Diff: 2 Page Ref: 273 31) Software can be rented or leased from a software vendor using the PMO model.

Answer: FALSE Diff: 2 Page Ref: 274 32) Many SaaS providers allow a wide range of customization within a basic set of functions.

Answer: TRUE Diff: 3 Page Ref: 275 33) Because they are cheap SaaS applications can instantly reach a global market.

Answer: FALSE Diff: 2 Page Ref: 275 34) The monthly costs of SaaS applications do not depreciate over time as a capital investment in software licenses would.

Answer: TRUE Diff: 3 Page Ref: 275 3 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

35) Over a one year period, it is possible that a traditional ERP architecture might be cheaper than a SaaS solution.

Answer: FALSE Diff: 3 Page Ref: 275 36) An ASP is a type of SaaS provider which offers to host the software of another vendor for the company that purchased the software license.

Answer: TRUE Diff: 3 Page Ref: 275 37) It is important to find the right balance between outsourcing and in-sourcing.

Answer: FALSE Diff: 2 Page Ref: 275 38) One long standing best practice is the creation of a formal governance process to manage the offshore relationship.

Answer: FALSE Diff: 3 Page Ref: 276 39) Small and midsize companies are most inclined to in-source their ERP operations.

Answer: FALSE Diff: 2 Page Ref: 276 40) ERP implementation teams should not use outsourcing partners as someone who will take ________ or to deflect blame when the project is not successful.

A) development B) users C) accountability D) change management Answer: C Diff: 2 Page Ref: 272 41) Working with a qualified outsourcing partner may give your IT staff the chance to ________ their skills and gain confidence.

A) manage B) oversee C) qualify D) improve Answer: D Diff: 1 Page Ref: 273

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42) In the U.S., corporations must adhere to the disclosure rules as specified by: A) the PMO. B) the industry council.

C) Sarbanes-Oxley.

D) the Project Executive.

Answer: C Diff: 2 Page Ref: 277 43) Ethics are developed through culture, values, and the ________ system of the individual with influences from family and society.

A) thought B) belief C) political D) corporate Answer: B Diff: 2 Page Ref: 277 44) The increased value of information and the ________ both endanger privacy in the information age.

A) use of spreadsheets B) greater bandwidth C) ease of use D) growth of information technology Answer: D Diff: 1 Page Ref: 279 45) There are very few institutions that can protect ________ globally.

A) intellectual property rights B) system security C) database access D) customer rights Answer: A Diff: 3 Page Ref: 278 46) ERP systems make it ________ to use and share information.

A) easier B) harder C) controversial D) necessary Answer: A Diff: 1 Page Ref: 278

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47) The ethical issues surrounding the use of information technology include, privacy, accuracy, property, and ________ issues.

A) communication B) adaptability C) accessibility D) conversion format Answer: C Diff: 2 Page Ref: 278 48) Any organization which collects personal information must follow a process on how this information is ________, used and shared.

A) processed B) collected C) disseminated D) collated Answer: B Diff: 2 Page Ref: 279 49) An individual's right to privacy must be balanced with: A) corporate social responsibility.

B) business process efficiencies.

C) the cost of maintaining the data.

D) the public's right to know.

Answer: D Diff: 3 Page Ref: 279 50) Organizations now must get a(n) ________ to collect and share individual's personal data.

A) database B) network application C) approval D) web cookie Answer: C Diff: 2 Page Ref: 280 51) The biggest threat to privacy from ERP systems is from ________ activities.

A) BPR B) data mining C) security D) data warehouse Answer: B Diff: 2 Page Ref: 280

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52) ________, where crooks use an individual's profile for fraudulent transactions, is now the number one crime in many parts of the world.

A) Data mining B) Phishing C) Internet fraud D) Identify theft Answer: D Diff: 3 Page Ref: 280 53) The large amount of data being collected today and its integration with multiple sources means there is a greater chance the data may be: A) corrupted.

B) converted.

C) outsourced.

D) duplicated.

Answer: A Diff: 2 Page Ref: 280 54) To protect the accuracy of the data, ERP systems must embed ________, on data accuracy and make them available to organizations.

A) test examples B) training C) best practices D) policy Answer: C Diff: 3 Page Ref: 280 55) ERP systems can help to ________ data with an organization's trading partners.

A) enable B) synchronize C) privatize D) import Answer: B Diff: 3 Page Ref: 280 56) ________ collect and disseminate information about consumers to be used for credit evaluation and certain other purposes.

A) Marketing agencies B) Accounting firms C) Credit reporting agencies D) ERP systems Answer: C Diff: 2 Page Ref: 280

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57) The ________ principle of ethics makes organizations realize that they are not the ultimate owners of the information collected on individuals.

A) privacy B) accessibility C) accuracy D) property Answer: D Diff: 2 Page Ref: 281 58) With the passage of the ________, the U.S. government has gained access to vast databases of telephone and email records.

A) NAFTA Act B) Patriot Act C) COPA Act D) FCRA Act Answer: B Diff: 2 Page Ref: 281 59) The ________ principle of ethics forces an organization to have proper controls for authorization and authentication.

A) privacy B) accessibility C) accuracy D) property Answer: B Diff: 2 Page Ref: 281 60) Identity theft in the U.S. is: A) declining.

B) increasing.

C) stabilizing.

D) random.

Answer: A Diff: 2 Page Ref: 282 61) In the context of an ERP implementation, ________ theory would implement very few restrictions on using the information from this system to monitor employee performance or collect and share consumer information from the system..

A) stakeholder B) stockholder C) communication D) social contract Answer: B Diff: 3 Page Ref: 282

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62) In the context of ________ theory, the ERP system would not be allowed to share or collect consumer information unless the consumers were notified of this plan and only if this activity would result in a net benefit to the society.

A) stakeholder B) stockholder C) communication D) social contract Answer: D Diff: 3 Page Ref: 282 63) Globalization and offshoring have ________ the level of ethical concerns.

A) lowered B) mediated C) raised D) mitigated Answer: C Diff: 2 Page Ref: 283 64) Often in software negotiations, the software is placed in ________ in the event the software company declares bankruptcy.

A) storage B) escrow C) production D) development Answer: B Diff: 2 Page Ref: 283 65) One danger of outsourcing is that employees for an outsourcing partner can leave and go to work for a(n) ________.

A) government B) attorney C) competitor D) consultant E) none of the above Answer: C Diff: 2 Page Ref: 273 66) Language and time zone differences can be difficult to ________ as far as their impact on an IT project.

A) quantify B) identify C) determine D) document E) all of the above Answer: A Diff: 2 Page Ref: 274 9 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

67) Outsourcing ERP functions might look cheaper on paper, but savvy managers must consider the total cost of ________.

A) attorneys B) consultants C) ownership D) management E) none of the above Answer: C Diff: 2 Page Ref: 274 68) SaaS is a model for ________ delivery rather than being a separate market segment.

A) data B) software C) hardware D) consultant E) none of the above Answer: B Diff: 3 Page Ref: 274 69) The SaaS model brings lower implementation risk and a better ________ transfer between integrators and users.

A) knowledge B) hardware C) data D) consultant E) all of the above Answer: A Diff: 3 Page Ref: 274 70) The rapid growth in SaaS-based applications is due in part to the advent of PCs and the ________.

A) printers B) cell phones C) internet D) iPods E) none of the above Answer: C Diff: 3 Page Ref: 274

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71) The learning curve for SaaS-based applications is less because most users already know how to use a ________.

A) web browser B) personal computer C) printer D) iPod E) none of the above Answer: A Diff: 2 Page Ref: 274 72) The adoption of the SaaS model may turn applications into ________.

A) hardware B) commodities C) disasters D) managers E) none of the above Answer: B Diff: 3 Page Ref: 275 73) When using a computer, most people spend the majority of their time using ________ applications.

A) custom B) end-user developed C) illegal D) standard E) none of the above Answer: D Diff: 2 Page Ref: 275 74) It is a myth to think that SaaS applications do not need any ________.

A) attorneys B) hardware C) configuration D) consultants E) none of the above Answer: C Diff: 3 Page Ref: 275 75) Ethics is sometimes referred to as the science of ________.

A) managers B) attorneys C) morality D) consultants E) none of the above Answer: C Diff: 2 Page Ref: 277 11 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

76) How can companies guard themselves from lack of performance on the part of consulting partners?

Answer: It is important that companies safeguard their relationship with consulting firms with carefully drawn up contracts. Sometimes consulting firms will send out their best people for the first week or two and then replace them with inexperienced and incompetent staff. A clear description of the roles and expectations of the consultants can help address performance issues.

Diff: 2 Page Ref: 295 77) Why do ERP implementations need an audit plan?

Answer: Audit plans are necessary to ensure that the ERP system has the appropriate automated and manual controls in place. These controls will help to prove the completeness of key processes such as the data conversion process. The audit will also consider whether there is enough separation in duties as far as controls are concerned. Auditors must also evaluate the data flow for approval processes, change controls and software update and testing.

Diff: 3 Page Ref: 295 78) How has the need for SOX compliance impacted ERP systems?

Answer: The Sarbanes-Oxley Act of 2002 has had a huge impact on business today. In particular, sections 404 and 409 related to IT controls. Section 404 impacts how internal controls are set up and states that IT systems have to have adequate internal controls and procedures for financial reporting. Section 409 states that there must be real-time access to operational and financial corporate data. Both of these must be kept in mind when implementing an ERP system.

The ERP system must be set up to support SOX compliance in terms of internal controls, timely access to data, and financial reporting.

Diff: 3 Page Ref: 286 79) How should an ERP system be secured?

Answer: Because many users now access their ERP systems with browsers, they are increasingly susceptible to viruses, hackers and attacks over the Internet. Employees need to be educated about the importance of maintaining security for their ERP system. User IDs and passwords can be stolen and sometimes firms hire consultants to try and hack into their systems to test users. PDAs and laptops with sensitive information can also be stolen. ERP systems are prime targets since they contain so much sensitive information. A security plan should be created which starts with changing passwords frequently and educating users. Extensive hardware and network security features should also be in place.

Diff: 2 Page Ref: 289 80) How should an organization with an ERP system plan for a disaster?

Answer: Because an ERP system is considered to be "mission critical", it is important that some planning be done for both natural and man-made disasters. For large companies, one estimate is that they lose $13K for every minute the ERP system is down. Of course there must be some trade-off between the acceptable level of risk and the cost of getting the systems back up and running. Sometimes, companies set up alternate sites at different locations that are ready in case the original systems go down. Data backups may also be stored in multiple locations and on different media.

Diff: 2 Page Ref: 293 12 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

81) What is outsourcing? How is it used in ERP systems?

Answer: Anytime a company decides to sub-contract its business processes or functions to another company, it can be said to be engaged in outsourcing. In this respect, offshoring is just one type of outsourcing. Over the past 10 to 20 years there has been a growing trend to outsource many different IT functions from maintenance to development. This has impacted ERP systems more and more recently. Some firms outsource the whole management and delivery of their ERP applications. Some may outsource different parts of the development and maintenance. They may also have economic benefits for offshoring these same pieces of the ERP system. This strategy is especially popular for small and medium-sized companies which don't want to invest a lot of resources in their own, unique ERP system.

Diff: 3 Page Ref: 294 82) What are the potential drawbacks to outsourcing ERP systems?

Answer: Ostensibly there are many benefits to outsourcing ERP systems. But there are some less obvious reasons why a firm may decide against it. Because ERP outsourcing is still relatively new the outsourcing partner may not have enough expertise and experience in integrating with other applications in the organization or with external business partners. There are also a lot of hidden costs such as travel costs, monitoring costs, and the lost productivity and revenues if things do not go well with the system. Because these systems are mission critical, some firms may not like to give up control of their systems to an outside company and possibly lose crucial intellectual property.

Diff: 2 Page Ref: 270 83) What is the SaaS model and how is it impacting ERP systems?

Answer: The Software as a Service model is a way that expensive software like ERP software can be leased or rented from a software vendor. For a specific monthly fee, this vendor will maintain, operate, and support the software for the client. It is a way of delivering ERP applications over the Internet in a way that allows users to access them with an Internet browser.

This makes it easier for users to access and learn since they are probably already quite familiar with Internet browsers. It also means that it can be accessed from many different devices.

Because SaaS vendors can sell standardized applications to a global market, the economies of scale may drive down the cost too.

Diff: 3 Page Ref: 274 84) What are the ethical considerations associated with ERP systems?

Answer: The basic ethical framework described as PAPA (privacy, accuracy, property, and accessibility) certainly applies equally to an ERP system. Because the data is totally integrated, there are more chances for sharing data and violating an individual's privacy. The accuracy of the data could also be a big problem since the data is supposed to be entered once and then it is replicated to dozens of other applications throughout the enterprise. So if it is wrong, the damage is even greater. If implemented properly with good controls, ERP systems can safeguard the individual's information better than before, but if done poorly, the ERP system can also make it harder. The same can be said as far as the accessibility of the information. In an ERP system, the proper access controls must be in place and this can make it easier to control access if done correctly.

Diff: 3 Page Ref: 277 13 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 11 Supply Chain Management 1) A complete SCM solution includes customers, service providers and partners.

Answer: TRUE Diff: 2 Page Ref: 304 2) SCM focuses on a few key parties and processes.

Answer: FALSE Diff: 2 Page Ref: 304 3) SCM stands for Supply Change Management.

Answer: FALSE Diff: 1 Page Ref: 305 4) SCM integrates supply and demand management within and across companies.

Answer: TRUE Diff: 1 Page Ref: 305 5) SCM is an outgrowth of Porter's concept of the "value chain."

Answer: TRUE Diff: 2 Page Ref: 305 6) Supply chain processes can be divided into primary and tertiary activities.

Answer: FALSE Diff: 2 Page Ref: 305 7) A company's supply chain strategy and its competitive strategy must be aligned in order for the company to be successful.

Answer: TRUE Diff: 2 Page Ref: 305 8) The supply chain has minimal impact on the firm's value chain.

Answer: FALSE Diff: 2 Page Ref: 305 9) As companies work to focus on core competencies and become more flexible, they have reduced their ownership of raw material sources and distribution channels.

Answer: TRUE Diff: 3 Page Ref: 306 10) Traditionally different departments such as marketing, purchasing, and manufacturing all shared the same objectives and worked together.

Answer: FALSE Diff: 2 Page Ref: 306

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11) There is basically only one general type of supply chain.

Answer: FALSE Diff: 2 Page Ref: 306 12) The inventory system is one of the key drivers of supply chain performance.

Answer: TRUE Diff: 2 Page Ref: 309 13) The two main types of facilities are functional sites and storage sites.

Answer: FALSE Diff: 2 Page Ref: 309 14) In general, increasing the number of facilities increases the total transportation cost.

Answer: TRUE Diff: 3 Page Ref: 309 15) Maintaining a large inventory generally increases the likelihood of a stock out for that product.

Answer: FALSE Diff: 2 Page Ref: 40309 16) The service industry has no finished goods inventory.

Answer: TRUE Diff: 1 Page Ref: 309 17) The type of transportation used by a company will help to determine the location of facilities in the supply chain.

Answer: TRUE Diff: 2 Page Ref: 309 18) Information is not a major driver of supply chain effectiveness because it does not have a physical presence.

Answer: FALSE Diff: 2 Page Ref: 309 19) Supply chains exist in both service and manufacturing organizations.

Answer: TRUE Diff: 2 Page Ref: 310 20) Labor utilization is one of the three types of flows in a typical supply chain.

Answer: FALSE Diff: 3 Page Ref: 310 21) Many companies are now using the Internet as part of their SCM solution.

Answer: TRUE Diff: 1 Page Ref: 310 2 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

22) In SCM software, planning applications are used to track the physical status of goods.

Answer: FALSE Diff: 2 Page Ref: 310 23) Procurement is the B2C purchase and sale of supplies and services.

Answer: FALSE Diff: 2 Page Ref: 311 24) Warehousing and inventory control functions are being increasingly outsourced to logistics partners.

Answer: TRUE Diff: 3 Page Ref: 311 25) The order fulfillment process produces and supplies products to the distribution channels based on past forecasts or POS data.

Answer: FALSE Diff: 3 Page Ref: 312 26) In the retail industry, product returns are a big issue and must be included in the management of the supply chain.

Answer: TRUE Diff: 2 Page Ref: 312 27) Failure to consolidate the forecasting information along the supply chain will result in the Marketing Effect for an organization.

Answer: FALSE Diff: 3 Page Ref: 312 28) More brick-and-mortar manufacturers are adding e-commerce capabilities, and are facing new challenges such as the individual delivery of products.

Answer: TRUE Diff: 3 Page Ref: 319 29) CRM uses e-business concepts and Web technologies to manage inventory and information beyond the organization, upstream and downstream.

Answer: FALSE Diff: 2 Page Ref: 319 30) e-SCM unites all the steps in the business cycle, from initial product design until a finished product is delivered to the customer.

Answer: TRUE Diff: 2 Page Ref: 319 31) Software that supports collaboration among groups of people over networks is called VPNs. Answer: FALSE Diff: 2 Page Ref: 312 3 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

32) The PMO system can send sales and inventory data directly from the retail store to the warehouse.

Answer: FALSE Diff: 3 Page Ref: 312 33) e-SCM is the use of Web-based technology to support the key procurement processes.

Answer: FALSE Diff: 1 Page Ref: 312 34) Ariba is a company that offers procurement solutions.

Answer: TRUE Diff: 2 Page Ref: 314 35) Supply webs, also known as exchanges, are virtual locations where buyers and sellers can meet.

Answer: TRUE Diff: 3 Page Ref: 315 36) In an auction, a company post requests for bids on supplying specific quantities of a particular product.

Answer: FALSE Diff: 3 Page Ref: 315 37) In today's world, most companies in-source the handling of e-logistics.

Answer: FALSE Diff: 3 Page Ref: 315 38) Because there is considerable overlap between SCM and e-SCM systems, there has been a recent surge in integrated solutions available on the market.

Answer: FALSE Diff: 3 Page Ref: 316 39) Until the late 1990's the focus of organizations was on improving their external efficiency.

Answer: FALSE Diff: 2 Page Ref: 316 40) As opposed to ERP systems, SCMs are oriented to supporting ________ business processes.

A) core B) transactional C) inter-organizational D) adaptive Answer: C Diff: 3 Page Ref: 316

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41) As SCMs matured, they were found to have significant overlap with ________ systems.

A) CRM B) ERP C) data warehouse D) RFID Answer: B Diff: 2 Page Ref: 316 42) ERP applications help make SCMs more effective by making ________ easier and by providing real-time information.

A) decision-making B) system design C) security planning D) data sharing Answer: D Diff: 2 Page Ref: 316 43) Because ERP systems provide ________ information, decisions such as ordering raw materials can be based on actual inventory data.

A) real-time B) processed C) supplier D) reverse auction Answer: A Diff: 2 Page Ref: 316 44) ERP systems are being ________ to take advantage of the Internet revolution.

A) expanded B) web-enabled C) reengineered D) reverse engineered Answer: B Diff: 1 Page Ref: 316 45) ERP vendors are adding more ________ functionality to their products and this is helping to blur the line between them.

A) data mining B) system security C) SCM D) SFA Answer: D Diff: 2 Page Ref: 317

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46) The joint design of products is an element associated with the ________ dimension of supply chain integration.

A) synchronized planning B) information integration C) workflow coordination D) new business model Answer: A Diff: 3 Page Ref: 318 47) The coordination of production planning and operations is an element associated with the ________ dimension of supply chain integration.

A) synchronized planning B) information integration C) workflow coordination D) new business model Answer: C Diff: 3 Page Ref: 318 48) The direct sharing of real-time information is an element associated with the ________ dimension of supply chain integration.

A) synchronized planning B) information integration C) workflow coordination D) new business model Answer: D Diff: 2 Page Ref: 318 49) Logistics restructuring is an element associated with the ________ dimension of supply chain integration.

A) synchronized planning B) information integration C) workflow coordination D) new business model Answer: D Diff: 3 Page Ref: 318 50) Planning ________ refers to the joint design and execution of plans for product introduction, forecasting, and replenishment.

A) design B) synchronization C) approval D) collaboration Answer: B Diff: 2 Page Ref: 318

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51) Smoothing out and automating the procurement activities between a manufacturer and a supplier is an example of: A) BPR. B) data mining analysis.

C) information collaboration.

D) workflow coordination.

Answer: D Diff: 3 Page Ref: 319 52) Allowing a vendor to check on your company's product inventory and then automatically generating a purchase order is an example of a(n) ________ activity in the procurement process.

A) data mining B) phishing C) workflow D) value chain Answer: C Diff: 3 Page Ref: 319 53) It would be much easier to integrate ERP and SCM applications if all the members of the supply chain adhered to: A) strict security protocols.

B) standard data formats.

C) best practices.

D) open standards.

Answer: D Diff: 3 Page Ref: 319 54) If two supply chain partners want to link up their ERP systems and they are using different ERP software, they must either purchase or develop the ________ needed to connect them.

A) test data B) servers C) best practices D) middleware Answer: D Diff: 3 Page Ref: 319 55) With globalization and the increase in mergers and acquisitions, ________ has become an important approach for integrating the disparate systems and data.

A) ERP B) EAI C) SCM D) CRM Answer: B Diff: 3 Page Ref: 320

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56) With the introduction of ________ models such as EJB, DCOM, and CORBA, application integration has gotten easier.

A) IT B) marketing C) component-based D) EAI Answer: C Diff: 3 Page Ref: 320 57) DCOM and CORBA make application integration easier by providing a standard set of: A) protocols.

B) data conversion formats.

C) user profiles.

D) APIs. Answer: D Diff: 3 Page Ref: 321 58) CORBA/IIOP and ________ are the two main protocols for object communication across networks, including the Internet.

A) DCOM B) EJB C) API D) COM Answer: A Diff: 3 Page Ref: 321 59) ________ is the technology at the heart of the SOAP communication protocol that helps define a new way for processes on different systems to communicate.

A) Database B) XML C) DCOM D) SCM Answer: B Diff: 3 Page Ref: 321 60) ________ is the first phase of the Enterprise Application Integration process.

A) Solution outline B) Architecture C) Design D) Implementation Answer: A Diff: 2 Page Ref: 321

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61) ________ is not a benefit of Enterprise Application Integration.

A) Increased efficiency B) Lower costs C) Expanding the diversity of data sets D) Improved customer service Answer: C Diff: 2 Page Ref: 322 62) The success of SCM integration often depends more on ________ and on arriving at an agreed policy between trading partners, rather than on sophisticated information technology.

A) networks B) protocols C) communication D) standardization Answer: D Diff: 3 Page Ref: 324 63) In a supply chain, ________ are either production sites or warehouses.

A) networks B) suppliers C) facilities D) components Answer: C Diff: 2 Page Ref: 308 64) Carrying a large inventory may improve customer service but will also increase the cost of ________ inventory.

A) producing B) shipping C) auditing D) holding Answer: D Diff: 2 Page Ref: 308 65) The ________ process responds to customer demand by managing orders, and storing and delivering finished goods.

A) manufacturing B) order completion C) order fulfillment D) marketing E) none of the above Answer: C Diff: 2 Page Ref: 311

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66) The ________ process uses past forecasts to produce and supply products for the company's distribution channels.

A) manufacturing B) order completion C) order fulfillment D) marketing E) none of the above Answer: A Diff: 2 Page Ref: 312 67) In a physical distribution, the ________ is the final destination of a marketing channel.

A) vendor B) customer C) supplier D) marketeer E) none of the above Answer: B Diff: 3 Page Ref: 312 68) The most important ingredient in successful e-SCM is the ________ of partners, suppliers, and employees.

A) dedication B) order completion C) order fulfillment D) marketing E) none of the above Answer: A Diff: 2 Page Ref: 319 69) The company's local area network, or ________, which is behind the company firewalls, is an important component of e-SCM. A) extranet B) intranet C) internet D) WAN E) none of the above Answer: B Diff: 2 Page Ref: 319

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70) ________ are important components for connecting external supply chain partners and are usually secured via a VPN. A) Extranets B) Intranets C) Internets D) WANs E) none of the above Answer: A Diff: 2 Page Ref: 312 71) The corporate ________ serves as a gateway to a corporate website that enables collaboration and access to company information.

A) extranet B) portal C) internet D) WAN E) none of the above Answer: B Diff: 2 Page Ref: 312 72) To shorten the time it takes to bring a new product to market, collaborative design and product development among the parties in the supply chain is ________.

A) minimal B) never done C) unlimited D) crucial E) none of the above Answer: D Diff: 2 Page Ref: 314 73) On-line buyers want to purchase a product on-line and also be able to ________ that shipment until it arrives at their doorstep.

A) avoid paying for B) ignore C) track D) forget about E) none of the above Answer: C Diff: 1 Page Ref: 315

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74) Collaborative planning involves a shared ________ between business partners.

A) contract B) forecast C) project D) attorney E) none of the above Answer: B Diff: 3 Page Ref: 316 75) Collaborative planning is difficult since it involves ________ from multiple parties across different companies.

A) output B) input C) processes D) data E) all of the above Answer: B Diff: 3 Page Ref: 316 76) What is supply chain management (SCM)? How is it an outgrowth of Porter's value chain concept?

Answer: A formal definition of SCM is that it "encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activities." Porter developed the idea of the "value chain" were all the activities that add value to an existing service or product to provide competitive advantage. The supply chain focuses on the primary activities of the value chain and how to improve it with better flow of information and material.

Diff: 2 Page Ref: 305 77) Describe some of the potential benefits of SCM. Answer: A good supply chain helps the company be more agile and flexible in today's Webenabled environment. The supply chain can improve trust and collaboration among supply chain partners while reducing inventory carrying costs. By integrating the supply chain processes the supply chain can be more responsive and efficient.

Diff: 2 Page Ref: 306 78) How did Wal-Mart integrate RFID technology into their SCM system?

Answer: Wal-Mart tried to force its suppliers to all use RFID technology, but because of the high cost, only a small percentage had adopted it by 2003. It has moved away from using the tags in distribution centers and now is using them more in stores to reduce out of stock situations and to drive sales promotions. It recently expanded the use of RFID tags from 100 to 1000 stores.

Data is collected when any product moves in the store, including at the cash register. Suppliers can use the Web to check exactly where their products are. Some employees have been given handheld RFID readers to help them find products.

Diff: 3 Page Ref: 307

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79) What are the four main drivers of SCM performance?

Answer: There are four main drivers of SCM performance. These include the actual facilities, the inventory, transportation, and how well the information is used to tie it all together. Looking at these four drivers in detail can help improve the responsiveness and efficiency of the supply chain as a whole.

Diff: 2 Page Ref: 307 80) How are the different facilities integrated into the supply chain network?

Answer: A facility is a place in the supply chain where product is manufactured, stored or transshipped. The two major types of facilities are production sites and storage sites or warehouses. Decisions have to be made about the location of the facilities, their capacity, and how they will be linked up to distribution centers and suppliers. This will impact the transportation costs and the overall responsiveness of the supply chain to customers.

Diff: 3 Page Ref: 307 81) Describe the different "flows" in a supply chain network.

Answer: One view of the supply chain is that it supports different "flows" to meet customer demand. The most obvious flow is the movement of materials from suppliers to customers. Less obvious is that there are financial flows and information flows that go along with each movement of material in the chain. Coordinating the flow of all three between the various supply chain partners adds considerable complexity to it but also provides more opportunities for making the supply chain more effective and efficient.

Diff: 2 Page Ref: 309 82) How have the Internet and Web-based applications changed SCM? Answer: More and more companies are using the Internet and Web-based applications as part of their SCM solution. There are special procurement marketplaces on the Web for different industries where manufacturers can trade and even make auction bids with suppliers.

Procurement activities are also done more and more over the Internet with e-procurement solutions. Creating an integrated e-supply chain will continue to be a major competitive advantage as it speeds time to market, improves order fulfillment and customer satisfaction.

Diff: 2 Page Ref: 312 83) What are some of the processes supported by SCM? Answer: The main SCM processes include procurement, which is the purchase and sale of supplies and services between businesses. Outsourcing processes are also supported by SCM where one company provides goods or services for another company that may have been provided in-house. Examples of some of these outsourced services include transport, warehousing, and inventory control. SCM should also support the process of order fulfillment.

This involves taking the order, picking the order, packaging the order and finally, the physical distribution of the order to the customer. Another crucial process in SCM is the forecasting process. Forecasting is involved in predicting the weekly or monthly product activity for a specific period of time. SCM can provide more accurate and timely data to the forecasting process which will in turn, generate a better forecast.

Diff: 3 Page Ref: 311

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84) What are the components of E-SCM? Answer: There are basically six different components of the e-supply chain. These include replenishment, e-procurement, collaborative planning, collaborative product development, elogistics, and supply webs. These components are built with a technology infrastructure and a set of IT development tools.

Diff: 2 Page Ref: 312

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Enterprise Systems for Management, 2e (Motiwalla/Thompson) Chapter 12 Customer Relationship Management 1) CRM implementations should be technology driven.

Answer: FALSE Diff: 2 Page Ref: 333 2) CRM stands for "Customer Reporting Management."

Answer: FALSE Diff: 1 Page Ref: 333 3) CRM is a brand new concept.

Answer: FALSE Diff: 1 Page Ref: 333 4) CRM provides support for front-end customer facing functionality.

Answer: TRUE Diff: 1 Page Ref: 334 5) Organizations first implemented CRM to capture customer data for analysis.

Answer: TRUE Diff: 2 Page Ref: 334 6) Allowing customers to obtain information via Internet-based inquiries helped organizations to scale up their call center operations.

Answer: FALSE Diff: 3 Page Ref: 335 7) CRM systems made personalized marketing and customized promotions more feasible.

Answer: TRUE Diff: 2 Page Ref: 335 8) CRM systems lack integration with the enterprise wide data collection and analysis systems.

Answer: FALSE Diff: 2 Page Ref: 336 9) The use of CRM systems has triggered some concerns about infringing on individual privacy.

Answer: TRUE Diff: 2 Page Ref: 336 10) Internet technologies are not very useful for collecting consumer data.

Answer: FALSE Diff: 2 Page Ref: 336 11) Customer tracking and profiling are key tools for effective CRM. Answer: TRUE Diff: 2 Page Ref: 338 1 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

12) The Internet makes it easier for customers to switch vendors.

Answer: TRUE Diff: 2 Page Ref: 338 13) CRM systems are not oriented towards delivering strategic value for an organization.

Answer: FALSE Diff: 2 Page Ref: 338 14) Improving communication and reducing costs are examples of tactical benefits of a CRM system.

Answer: TRUE Diff: 3 Page Ref: 338 15) Analytical CRM systems provide front and back-end support for sales and marketing.

Answer: FALSE Diff: 2 Page Ref: 338 16) Operational CRM systems improve the efficiency of CRM delivery and support processes.

Answer: TRUE Diff: 3 Page Ref: 338 17) Analytic CRM systems make use of sophisticated data warehousing and data mining software.

Answer: TRUE Diff: 2 Page Ref: 339 18) Vlogs are examples of common channels for collaborative CRM systems.

Answer: FALSE Diff: 3 Page Ref: 339 19) The CRM portal helps to integrate all the different channels for interacting with the customer.

Answer: TRUE Diff: 2 Page Ref: 339 20) A good CRM system can automate all the customer relationships.

Answer: FALSE Diff: 2 Page Ref: 339 21) The key goal of campaign management is to generate "leads."

Answer: TRUE Diff: 1 Page Ref: 339 22) The goal of service management is to convert leads into customers.

Answer: FALSE Diff: 2 Page Ref: 339 2 Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall

23) The focus of market research is finding ways to increase the duration and intensity of customer relationships.

Answer: FALSE Diff: 3 Page Ref: 339 24) A good CRM system requires a closed knowledge management loop which consolidates, analyzes and shares the customer information.

Answer: TRUE Diff: 3 Page Ref: 340 25) Customer profiling makes it harder to have individualized contact with a customer.

Answer: FALSE Diff: 2 Page Ref: 340 26) Some of the current CRM vendors originally started off in the SCM market.

Answer: FALSE Diff: 3 Page Ref: 341 27) SFA tools help sales personnel to track sales leads and contact with customer.

Answer: TRUE Diff: 2 Page Ref: 341 28) The call center has become a common source for customers to find quick answers to complex technical questions.

Answer: FALSE Diff: 3 Page Ref: 341 29) The growth in data being generated by web-driven business has been a driver for data mining and analytics functionality.

Answer: TRUE Diff: 2 Page Ref: 341 30) No single CRM software package can provide all the functionality needed for a comprehensive CRM system.

Answer: TRUE Diff: 3 Page Ref: 341 31) Typical CRM systems follow a cloud architecture.

Answer: FALSE Diff: 2 Page Ref: 342 32) A company may also choose a hosted architecture where the CRM vendor runs and maintains the CRM applications and data on their own web site.

Answer: TRUE Diff: 2 Page Ref: 343

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33) Improvements in the speed and security of the Internet have recently spurred interest and demand for in-sourced CRM systems.

Answer: FALSE Diff: 2 Page Ref: 343 34) One key concern about hosted CRM applications is that they do occasionally experience downtime and this can really hurt the company whose application is hosted.

Answer: TRUE Diff: 2 Page Ref: 343 35) The hardware requirements document will outline what the new CRM system capabilities should be. So this is a crucial document in the CRM implementation.

Answer: FALSE Diff: 2 Page Ref: 345 36) Hosted CRM systems have become an attractive alternative for small and large sized firms.

Answer: FALSE Diff: 2 Page Ref: 345 37) Paying a CRM vendor to host your CRM applications is a less expensive alternative to purchasing licenses to CRM software and running it yourself.

Answer: TRUE Diff: 2 Page Ref: 345 38) CRM project deadlines should be firm to account for the organizations ability to change and not simply adhering to a delivery schedule set by a vendor.

Answer: FALSE Diff: 2 Page Ref: 345 39) At the beginning of a CRM implementation, management and personnel should agree on the metrics that need to be captured by the software.

Answer: TRUE Diff: 2 Page Ref: 346 40) It is easier and more economical to implement an ERP with a CRM system.

Answer: FALSE Diff: 2 Page Ref: 346 41) CRM should not be implemented as a(n) ________ system or all at one time.

A) core B) transactional C) inter-organizational D) single Answer: D Diff: 2 Page Ref: 347

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42) When implementing CRM, there must be ________ not only from management but also from individual users and departments.

A) planning B) buy-in C) data D) decisions Answer: B Diff: 2 Page Ref: 347 43) Implementing a CRM system is difficult because there is/are ________ of CRM functions scattered across a variety of different business areas.

A) vendors B) networks C) pieces D) data sharing Answer: C Diff: 2 Page Ref: 347 44) Every CRM system is unique and must be ________ to the needs of the organization.

A) customized B) processed C) analyzed D) reverse engineered Answer: A Diff: 2 Page Ref: 347 45) Management must decide to go with a ________ CRM solution or select a single vendor to support all the CRM requirements.

A) expanded B) web-enabled C) reengineered D) best-of-breed Answer: D Diff: 3 Page Ref: 347 46) In recent years, the CRM market is moving towards ________ vendors due to consolidation, mergers and acquisitions among CRM software vendors.

A) improved B) bigger C) fewer D) more Answer: C Diff: 1 Page Ref: 347

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47) Because they collect and organize consumer data and make it easier to share it, CRM systems have come under fire for ________ and ethical violations.

A) security B) information C) privacy D) business Answer: C Diff: 2 Page Ref: 347 48) Legislation has been passed that restricts collecting data from ________ even though they are a powerful buying segment.

A) religious groups B) political groups C) children D) ethnic groups Answer: C Diff: 1 Page Ref: 347 49) Many companies have pledged not to ________ collected data to outside vendors.

A) process B) sell C) report D) aggregate Answer: B Diff: 2 Page Ref: 347 50) CRM provides a(n) ________ relationship with the consumers to improve their buying experience.

A) synchronized B) integrated information C) one-on-one D) beneficial Answer: C Diff: 2 Page Ref: 347 51) The second generation of CRM systems provided a(n) ________ view of every customer interaction with the organization.

A) planned B) holistic C) transactional D) collaborative Answer: B Diff: 2 Page Ref: 347

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52) CRM systems provide unique, real-time experiences to the consumers based on their ________; namely, their physical location and current needs.

A) core process B) context C) profile D) situation Answer: B Diff: 3 Page Ref: 347 53) CRM systems can be categorized based upon their ________, business strategy, and implementation perspectives.

A) functionality B) level of data sharing C) tactical impact D) value chain alignment Answer: A Diff: 3 Page Ref: 348 54) The customer relationship process can be divided into the ________, support, and analytical processes.

A) maintenance B) marketing C) acquisition D) delivery Answer: D Diff: 3 Page Ref: 348 55) Successful CRM systems require the integration of people, ________ and technology.

A) consumer data B) networks C) best practices D) processes Answer: D Diff: 2 Page Ref: 348 56) ________ is/are not a major component of a CRM system.

A) Market research tools B) Sales force automation software C) Supply chain management software D) Support tools Answer: C Diff: 2 Page Ref: 348

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57) With the increasing costs of hosting and maintaining CRM systems, many companies have been forced to opt for a(n) ________ hosted CRM solution.

A) thin-client B) middleware C) component-based D) EAI Answer: A Diff: 3 Page Ref: 348 58) CRM systems must be a part of the overall corporate strategy and must never focus on just being a ________ solution.

A) marketing B) data conversion C) technology D) tactical Answer: C Diff: 2 Page Ref: 348 59) A recent Gartner study showed that ________ percent of all CRM initiatives fail.

A) 30 B) 50 C) 75 D) 80 Answer: C Diff: 3 Page Ref: 333 60) As opposed to an ERP system, CRM systems provide support for ________ functionality such as marketing, sales, and customer service.

A) database B) front-end C) back-end D) application Answer: B Diff: 2 Page Ref: 334 61) The focus of a CRM system should be always be on enhancing the ________ experience.

A) user B) designer C) customer D) manager Answer: C Diff: 1 Page Ref: 333

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62) CRM began in response to a changing market environment as mass marketing gave way to focused segment marketing and finally, target marketing to a(n): A) focus group.

B) core customers.

C) niche player.

D) individual.

Answer: D Diff: 2 Page Ref: 334 63) By using technology to analyze consumer data, companies found that ________ sales to loyal, repeat customers is much more profitable than acquiring new customers.

A) new B) incremental C) special D) non-standard Answer: B Diff: 3 Page Ref: 335 64) In CRM systems, a customer file is started from an initial point of ________, whether it is a phone call inquiry or a purchased lead.

A) networking B) demand C) marketing contact D) service support Answer: C Diff: 2 Page Ref: 335 65) A holistic view of a client's sales may reveal that the cost of marketing, selling, and servicing the client ________ much of the profit realized by a sale.

A) produces B) augments C) determines D) negates Answer: D Diff: 2 Page Ref: 335 66) Companies develop a marketing ________ of every customer by observing buying patterns and combining this with demographic data.

A) log B) profile C) call center D) CRM system E) none of the above Answer: B Diff: 2 Page Ref: 339

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67) The focus of ________ technology is on facilitating better communication between a customer and a telephone operator.

A) log B) marketing profile C) call center D) CRM system E) none of the above Answer: C Diff: 2 Page Ref: 339 68) True CRM brings together information from all the ________ sources within an organization.

A) software B) hardware C) data D) process E) none of the above Answer: C Diff: 1 Page Ref: 339 69) The ________ server houses the backend database and possibly retrieves information from other database systems in the company.

A) cloud B) database C) client D) web E) none of the above Answer: B Diff: 2 Page Ref: 342 70) The CRM ________ server provides an extranet access point for external users such as vendors.

A) cloud B) database C) client D) web E) none of the above Answer: D Diff: 3 Page Ref: 342

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71) CRM systems typically process ________ information such as customer contact data and profiles.

A) ill defined B) random C) incomplete D) well structured E) none of the above Answer: D Diff: 3 Page Ref: 343 72) Unstructured information such as documents and memos are provided to the CRM system by ________ systems.

A) knowledge management B) cloud C) client D) web E) none of the above Answer: A Diff: 3 Page Ref: 343 73) When beginning a CRM implementation, a company should focus on the ________ of the CRM project before considering possible technology solutions.

A) cloud B) database C) client D) goals E) none of the above Answer: D Diff: 2 Page Ref: 343 74) Salesforce.com is an example of a CRM application ________ provider and offers a quicker implementation and less expensive CRM option.

A) service B) cloud C) client D) web E) none of the above Answer: A Diff: 3 Page Ref: 345

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75) CRM should be viewed as a strategic business solution and not a ________ solution.

A) cloud B) technical C) client D) web E) none of the above Answer: B Diff: 2 Page Ref: 346 76) Why is it important that CRM be customer-driven rather than technology-driven?

Answer: This is because that to be successful, CRM implementations must involve an understanding of people, processes, and systems rather than just focusing on a narrowly defined IT application. Successful CRM necessitates that people change attitudes and that customerfacing processes change too. It is too often the case that companies just want to buy the CRM software and turn it on and then forget about it. This is one reason why they have such high failure rates.

Diff: 2 Page Ref: 333 77) What is CRM? How has it evolved?

Answer: CRM is Customer Relationship Management and it is an approach that offers to provide a better customer experience and do it more efficiently. As such, it combines corporate strategy, business methodology, and technology to meet a wide set of goals for companies. It is not a new idea, but as a technology, grew out of simple sales force automation applications and databases where salespeople wanted to store all their customer contact information. Gradually other applications were added in such as marketing automation and call center support. Then business analytics were added in to support all of the various functional areas of CRM. Diff: 2 Page Ref: 333 78) Why are some consumer advocates upset with the growth of CRM? Answer: The main reason that some consumer advocates are speaking out against CRM is because they view it as an invasion of individual privacy. One of the main purposes of CRM is to make it easy to view all of the data and transactions for each customer. This means that a wide range of data must be combined in order to get the 360 degree view of the customer. Companies also use the systems to create complex and detailed profiles about each customer that can be used to predict their behavior. However, this same data in the wrong hands can be a real danger to individuals so it is important that precautions are taken.

Diff: 2 Page Ref: 336 79) How is the focus of CRM now shifting from its tactical to its strategic impact?

Answer: With the growth of the Internet the possibilities of CRM have increased. Initially, companies used CRM to add tactical value by decreasing costs and improving customer-focused processes. Now, with the Internet and other changes, CRM is used more to increase brand loyalty and add value by attracting more customers. The basic idea is that CRM can be used in creative new ways to create a unique and meaningful experience.

Diff: 3 Page Ref: 337

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80) Describe the different ways of categorizing CRM. Answer: There are three general ways of thinking and talking about CRM. First, one can look at CRM purely from a functional perspective. In this view, there are two types of CRM; either sales force automation or customer support related. From a business strategy perspective one can view CRM as a business, technology, or customer relationship initiative. From an implementation perspective, CRM systems can be operational, analytical, or collaborative in their focus. Each perspective helps to explain the complex facets of CRM. Diff: 3 Page Ref: 337 81) How should CRM be integrated with customer delivery processes?

Answer: Delivery processes focus on direct contact with the customer to support the sequence of activities to solve a specific problem such as buying a car. So the key customer delivery processes should include campaign management, sales management, service management, and complaint management. All of these processes involve direct contact with the customer and CRM should make it easier for companies to provide these services to customers.

Diff: 3 Page Ref: 339 82) How is CRM integrated with the processes associated with data analysis?

Answer: To properly analyze customer data, CRM should be integrated with the collection, processing, consolidation, and analysis of all the data collected from the other CRM processes. It can be used to help better target and identify various market segments and integrate this with campaign management. It can also be used to find buying patterns and combine this with demographic data to create customer profiles and predict buying behavior.

Diff: 3 Page Ref: 339 83) What might a typical CRM architecture look like? What factors should be taken into consideration when designing a CRM architecture?

Answer: Typical CRM systems generally follow a client/server architecture. This architecture consists of an application server, a database server for the back end database, and a Web server.

The Web server will be important if users will have access to the CRM applications via the Internet. The main factors of interest would be to consider how well it processes queries, how easily the system can grow to accommodate more users, how easy it is for users to access, and how secure it is.

Diff: 3 Page Ref: 341

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