Week Two Questions

1. Explain information technology’s role in business?

Information technology is everywhere in business. Understanding information technology provides great insight to anyone learning about business. It not only has an effect on business but also the potential to transform it. IT has a positive impact by reducing costs, improving productivity and regenerating growth. 

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

• Efficiency IT Metrics - measure the performance of the IT system itself, ex, through put, speed and availability. 
• Effectiveness IT Metrics - measures the impact IT has on business processes and activities, including customer satisfaction, conversion rates and sell through increases. 

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

Michael Porters Five Forces Model is a useful tools to aid in understanding competition and its implications for business strategy. It also helps to determine the relative attractiveness of an industry. It includes the buying power, supplier power, threat of substitute products or services, threat of new entrant which becomes the rivalry among existing competitors. 

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

A business process is a standardised set of activities that accomplish a specific task, such as processing a customer's order. To evaluate the effectiveness of its business processes. The value chain approach views an organisation as a series of processes, each of which adds value to the product service for each customer. To evaluate the effectiveness of its business processes, an organisation can use Porter's value chain approach. An organisation creates value by performing a series of activities that Porter identifies as the value chain.