Solution Manual for Information Systems in

Organizations by Wallace

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Solution Manual for Information Systems in Organizations by Wallace

Instructor Guide
Wallace Simulations
John Hupp
Chapter 7 Simulation— Instructor Guide

Overview

In this simulation students play the role of a web consultant asked to settle a dispute among the
company’s marketing managers and web developers, who each have their own idea about what
will work best on the front page of the Chocolate Lovers Unite website.

The emphasis is on critical thinking, and students are asked to think through how to use
business intelligence to draw conclusions about the effectiveness of different photos, tag lines,
and copy on the company’s home page. Each week for six weeks, the student selects assets for
the A and B versions of the home page, and visitors are randomly directed to one or the other
when they visit the site. After each week, the student can view the analytical results for the two
versions, and compare conversion rates for newsletter signups. The student receives various
email and voice messages from other people, who comment on the results and argue over
which one is working best. With three choices for each of three asset categories (photo, tagline,
ad copy), the student obviously can’t test all the combinations. The goal is to be as systematic as
possible and draw correct conclusions from the business intelligence that is available,
recognizing that in the real world there is rarely enough time or resources to test everything.

The simulation touches on most of the key words in the chapter so students can see or hear
them in context. It reinforces the importance of data‐driven decision making, as the student
chooses which web assets to test, and draws conclusions from the results. The simulation also
shows how things can go awry during any experiment, when a bot attacks the Chocolate Lovers
Unite website.

“Can you believe this?” whispered the VP to you, as a loud argument broke out among the
marketing people, sales people, web designers, and just about everyone else in the room. They
all thought they knew what design would be most effective for Chocolate Lovers Unite (CLU)—
an online chocolate retailer with some of the most sumptuous products on the market. The VP
asked for quiet in the room, and when everyone settled down, explained that you would be
working with them to evaluate different website approaches.

“As a web analyst, you were asked to help CLU resolve these arguments using data driven
decision making and business intelligence. Which marketing pitch will work best? Your job is to
find out with real data, not guesswork. Time is short with the gift‐giving holiday season fast
approaching, so you better get started. Check your email and voice messages after you login…”
(Wallace 234–235)

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 Instructor Guide
Wallace Simulations
John Hupp
Suggestions for Use

Solo Learning
 TRADITIONAL: All simulations may be assigned as homework for individual students. Scores
would be recorded on their performance for evaluation and grades. Knowledge of the
chapter content is required to successfully complete each simulation.

 STUDY LABS: The simulations may also be used as lab work at the start of class. In this case it
is valuable to follow the activity with lectures, exercises, and/or discussion of the topics
covered in the chapter.

 FLIP‐THE‐CLASS: In this learning approach, the students are required to study the text and
recorded lecture with PowerPoint slides prior to the class session (conventionally done in
class). At the start of class a short, timed quiz on the chapter is recommended to encourage
prior study, to assess learning achieved, and to identify problem areas. The simulation is
then completed during class, solo or group, and followed by a discussion and reinforcement
of identified problem areas.

 ONLINE: The simulation is particularly useful in online or hybrid classes since it provides an
interactive learning exercise without an instructor. However, in order for the instructor to
assess difficulties with the topic, it is suggested that the simulation be accompanied by a
short quiz and/or online discussion topics. Discussion topics would be posted in a shared
forum, and students would be required to post their responses as well as replies to other
student comments. The simulation serves as the catalyst for the discussion, and the posted
topics should have open solutions rather than right or wrong answers.

Group Learning
 TRADITIONAL: Students are assigned to small groups of 3 to 5 and should complete the
simulation in class together. It is recommended that instructors avoid using this approach
outside class because students may not participate as well. During the simulation, students
are asked to identify 3 to 5 key decisions based upon the simulation that companies must
make in developing their competitive strategies. These decision points are submitted as a
group upon completion of the activity.

 WALK‐THRU: In this approach, the instructor presents the simulation to the class as a whole.
As each decision point is reached in the simulation, the presentation is paused, and the
instructor opens a discussion for the solution to the class. In order to maintain progress and
engagement, points of difficulty, contention, or tangential ideas are noted on the
blackboard for follow‐up discussion.

 PARSING‐THE‐LECTURE: The simulation proceeds in segments divided by interactive

participation. The instructor divides the lecture and PowerPoint slides into matching
segments. Each micro‐lecture or segment should be no longer than seven minutes (about 2
to 3 slides). The instructor introduces the topic and initiates the simulation. At each decision

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 Instructor Guide
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John Hupp
point, the instructor gives the micro‐lecture on that subject, and the class then selects their
preferred decision(s). It is important that the instructor not correct wrong solutions at this
time but allows the simulation to continue and score. During the feedback section, the
instructor clarifies any difficulties or errors and then closes the lecture.

 ONLINE: Each of these group learning approaches may be given in an online interactive
session. The Traditional approach could also be assigned to groups off‐line for submission.

Student Applied Questions

Questions
1. Transactional databases have the daily operational data in them. Even though we can
analyze this data, businesses generally want to do more. Transactional data is extracted
to a data warehouse, which enables greater analysis and use. What data would you
recommend a Marketing department to add to the data warehouse for these analytic
uses? Why is the transactional data insufficient for the Marketing department? Are
there other departments that might use non‐transactional data? Which ones and why?

2. Data mining examines patterns in a company’s data. What patterns might Chocolate
Lovers Unite look for in their website data? Would they need external data too? Are
they gathering this data? If not, how could they get it? Which patterns would be the
most valuable to them? Why?

3. Chocolate Lovers Unite is considering offering a new product but before they make such
an investment, they want be comfortable that they will gain a good return on it. What
kind of data will they need to make this decision? How do they get this data? What kind
of analysis should they do to find out if their idea is worthy?

4. Identify three things that a company is able to do with the data that they have about
their customers and employees that are not ethical. Are these all illegal as well as
unethical? What might be the consequences if a company were to do unethical but legal
things with their data?

5. A mid‐sized company is doing a good job with their transactional database, and they are
even using external data to help them analyze market trends and benchmarks.
However, their management really needs some way to know in an instant how the
company is doing in any area from sales to service to operations. What can they make to
give them this snapshot score of their performance? What would be the value of doing
this? What kinds of data might they want to use and where would they get this data?

Solutions
1. In addition to the sales order and customer transactional data, Marketing might want
data about their market such as demographic data. Competitive data would also be

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John Hupp
helpful, and they could buy such data about their competitors. Marketing is a good area
to explore because they will generally want lots of external data from many different
sources. Transactional data only tells Marketing what happened with their customers
and offerings, and it does not provide them sufficient information about the market
they have or want to have. Normally, most all departments can benefit from external
data. Finance might benefit from benchmarking data on other companies’ performance.
Operations might use external data to help them evaluate their productivity and yields.
Service may use external data on both their market and their competitors. Basically,
while it is valuable to keep informed about what is happening inside the company, it is
also essential to stay current with what is happening outside—external data sources do
this.

2. Spending patterns would be of interest to the company so they could evaluate the size
of orders and the selection of products. Patterns that show which products are
frequently bought together are also helpful. Other patterns that they might analyze
include such demographic analysis as product associations with age, location, gender,
date, or holiday. From these they might notice, as an example, that on Valentine’s Day,
males of all ages buy lots of chocolate. They may not be collecting sufficient
demographic data, and to do this site registration could be a good solution. Also, they
could purchase some of the demographic data they want. The most valuable patterns
would be those that identify key relationships between their offerings and other factors.
Knowing which factors generate the greatest sales revenue would help them target
those factors in the market and improve revenues.

3. They will be advised to add some market data to their warehouse. The type of market
data would be about their products and their competitors’ products. They might also
wish to know more about the demographics in their target markets. Marketing might
conduct some research and place their data in the warehouse to analyze along with this
external data. The primary analysis is likely forecasting the sales performance in the
market; however, some what‐if analysis would allow them to adjust some of the
marketing plans to fit their target better. Goal‐seeking analysis would help them
establish their pricing requirements and target sales quotas. They would gather the
needed data from their website, transactional databases, and from research and
external sources.

4. Employee data is a protected resource that is governed both by law and policies. It is
unethical and illegal for a company to provide detailed employee data to outside
sources. However, companies often provide summary data about their employees to
various agencies and establishments. Customer data is not as protected, and a company
may sell its data about customers to a buyer. However, this practice is considered
unethical by some and may result in customer dissatisfaction and possibly action against
the company. Privacy issues are increasingly important to both employees and

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John Hupp
customers. The ethics are shifting toward increased privacy, but they are changing faster
than the laws governing these practices. Therefore, several behaviors are considered
unethical but still legal. Facebook is currently confronting many of these privacy
challenges as they try to determine what data they can safely sell without losing their
customer base. The greatest concern of any company is to build customer loyalty
because customers vote with their money on their preferences. Whether legal or not,
any action that disrupts customer loyalty is a concern that may affect revenues and
ultimately brand.

5. A management dashboard would address this need well. In fact a tiered dashboard
design would optimize the solution for different levels of management. In this design
the lower managers’ dashboards would roll‐up into the senior managers’ displays. This
way all managers would have the dashboard and also be sharing the same data at
varying levels of detail and focus. The dashboard should provide the key performance
indicators for each of the managers, and these would be set by the company based
upon their objectives and needs. Additional data would vary by area to provide data
about critical issues and projects. Having an instant view of the current situation and
performance would enable managers to identify potential problems before they occur
and take actions to mitigate or solve them. Without a scoreboard the managers are
relying on their own personal awareness and knowledge which can often omit key
points and not indicate brewing problems. Dashboards enable the managers to be more
effective in decisions and actions. Companies also may provide these dashboards or
subsets of them to the employees themselves so they are able to evaluate what is
happening and how they are doing. The data for such dashboards generally comes from
the transactional database extracts at the lower management levels; however, the
higher management will have a need for more external data to provide them the view
of the market as well as their own performance.

Discussion Points
1. College life requires keeping up with a number of data sources from classes to financial
aid to career development. Assume that you have access to the data that you want at
the college, but you wished to create a student dashboard app for the smartphone.
What would this dashboard look like? What key areas of data would you want
displayed? How would you display them—numerically, graphically, or textually? How
often would you want the data updated and why? Would you be able to drill down into
these data summaries and access the details? Why? What challenges might you
encounter getting access to the needed data?

2. People often think of online analytic processing (OLAP) as something only done by a
company or division. However, multidimensional cubes from OLAP can be very helpful
to individual managers as well. Assume that you are one of the managers of a customer

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 Instructor Guide
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John Hupp
service department of a large corporation, and you are responsible for reaching set
quotas for customer calls, problem resolutions, and customer satisfaction. You have
access to the customer service data warehouse, but you would like to “slice and dice”
this data yourself using OLAP cubes. What kinds of data would you want about services
and problem resolutions? What dimensions would you use to analyze your
department’s performance? How often would you need this data updated and current?
How might such analytic use improve your department?

3. Many businesses today are using the data you generate and provide when you browse
the web. Whether you are using Facebook, Yahoo, or simply looking for a new sweater,
the data you provide is being analyzed and used by companies to improve their
performance. How does this analysis by these companies improve things for you? How
do you benefit as a consumer and browser? What data might you wish to be protected
and not available for others to use? What can you do as an informed consumer to
protect yourself from problems associated with misuse of the data you generate? What
do you want to be able to do? Why? Would this encumber companies from continuing
to provide the benefits you enjoy?

4. Consider the student dashboard that you created earlier. What RSS feeds would you add
to your dashboard in a mashup to make it more valuable to you? How would these
additions make the dashboard more effective for you? Would you encourage each
student to create their own smartphone mashup on their dashboards? Why?

5. Chocolate Lovers Unite needs to understand their competitive position and

performance in the market. They have their data warehouse with the website data and
the operational transaction data, but that is limited to just being about their company
and the market that they know. How can they extend this warehouse to better
understand their competitive position? What data would they need and where could
they get it? How do they decide whether to purchase the data or subscribe to the
source? Where do intelligent agents fit into this solution if at all? Finally, would such a
solution actually create value for the company? How?

Answers for Simulation

Sample feedback for correct student choices during the simulation follows.

Please note that for some questions, more than one choice might be acceptable. In those cases,
students might receive full or partial credit for answers other than those shown in the sample.

Works Cited
Wallace, Patricia. Information Systems in Organizations. Upper Saddle River: Pearson, 2013.

Copyright © 2013 Pearson Education, Inc. Page 6

Feedback on Your Choices in Chocolate Lovers Unite

1.Selecting Appropriate Analytic Metrics

Points: 10 out of 10

While all these metrics are potentially useful,you must know the number of unique visitors and the number of newsletter
signups each week in order to computer the conversion rate,which is what Leon wants to use.

Correct Choices Your Choices Points

1. Total # visitors

2. # Different countries

3. Average bounce rate on home page

4. # Unique visitors 5

5. Average time spent on home page

6. # Signups for newsletter 5

7. Top traffic sources

8. Total number of page views

Total Points 10

2.Selecting Assets to test

Points: 9 out of 9

You chose the following assets for the A and B versions for each week,and your conversion tates are shown.

Week 1 2 3 4 5 6

A B A B A B A B A B A B

Photo Product Woman Jogger Woman Product Woman Jogger Product Woman Jogger Product Woman

Tag Line Yumm Heart Give the gift Heart Yumm Heart Give the gift Yumm Heart Give the gift Yumm Heart
healthy healthy healthy healthy healthy

Copy Benefits Testimonial Finest Testimonial Benefits Testimonial Finest Benefits Testimonial Finest Benefits Testimonial
ingredients ingredients ingredients

Conversion 7.7% 6.5% 7.1% 6.7% 7.5% 6.6% 7.0% 7.8% 6.8% 7.1% 7.7% 6.7%

Rate

To give asset a fair test,you should have used it at least 3 times,but not more than 5 times.You earn 1 point for each asset that
was tested at least 3 times but not more than 5 times.
 # times selected Points

for use

Photos Product 4 1

Women 5 1

Jogger 3 1

Tag line Yumm 4 1

Heart healthy 5 1

Give the gift 3 1

Copy Benefits 4 1

Testimonial 5 1

Finest 3 1

Total Points 9

Note that not all the conversion rates you obtained are reliable because you did not use each asset at least 3 times,but no
more than 5 times,during the test.To obtain reliable results when testing the effectiveness of online promotions,be sure to give
each asset or website version a fair test.

3.Comparing Conversion Rates

This table shows the average conversion rates for each asset,based on the number of times it was used in a test.

Average Conversion

Rate(%)

Photos Product 7.67

Women 6.66

Jogger 7.07

Tag line Yumm 7.67

Heart healthy 6.66

Give the gift 7.07

Copy Benefits 7.67

Testimonial 6.66

Finest 7.07
 Solution Manual for Information Systems in Organizations by Wallace

4.Your Decisions about the Best Performing Assets

Points: 15 out of 15

The table below shows your decisions,and also shows the best choices based on the average
conversion rates. You earned 5 points for each correct selection.

Your choice Highest Conversion Points

Rate

Photos Product Product 5

Tag line Yumm Yumm 5

Copy Benefits Benefits 5

Total Points 15

If you had balanced the choices for assets each week,the average conversion rates would have been most
favorable for Product,Yumm,and Finest lngredients.

Total Points for Scored Choices

You received 34 out of 34 points, or 100%.

Discussion Questions
1.What led you to make your choices for best photo,best tagline,and best ad copy?

2.What are the advantages of web analytics for organizatios that maintain a website?

3.For this experiment,number of people signing up to get CLU's newsletter was the primary measure of
success.What other metrics should different kinds of organizations use,such as nonprofit membership
associations,universities,charities,or government agencies?

4.What improvements would you make to the experiment you just conducted to better analyze the effectiveness of
different assets that the web developers might use on the organization's front page?

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