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1a. The consumers are willing to pay to the industry that has been produced or created of any shape or kind. For instance, making a cake involves supplier opportunity cost of $11 and firm cost is around $12 and the company fix price of cake of $18. Therefore, customers would will to pay $20. Therefore, value would be created of $9 in transformation process.
1b. Decreasing supplier opportunity costs would help in incentive creation for suppliers in order to supply the required resources for few amount. For example, increasing the production of paper by 30% would decrease the supplier opportunity costs by 15%.
1c. For example, the firm would be earning zero value added if the competitors charges less price on product and providing other beneficial such as gifts, coupons, etc.
2. The firm can be on the losing side if the products are made less valuable by the users. The people can make use of particular products more often which makes difficult for the firm to survive with the products as it leads to congestion. For example, if large numbers of users make use of internet then it can affect internet speed and utility of the users would decrease and will directly impact on service provider (Chen, 2013).
3. The role of managers is effective in the process of information system as they can provide strong guidance that may be related to network security and would be effective in coordinating entire technology operations. Moreover, they would be possessing required skills and experience regarding information system implementation. For example, if managers are not included then the management would find difficult in installing system and ensuring security of the system.
4. Classic Information good is that good that is valued for the message that it holds and product is digitized. For example, a book having short stories, pieces of music in CD, etc. Information intensive goods are related to information for developing product and services and making it available in the market. For example, book retail firm, telephone, etc (Nakahara and Sasaki, 2013).
5. Richness is comprised of the information that is reliable, secure, bandwidth or level of information, information customization to a sole buyer and interaction between seller and buyer. Therefore, rich information is developed which can be used for making strong decision. Further, reach trade-off relates with the people that take effective participation in exchanging or sharing information gained from richness.
6. Business integration is employed in order to make appropriate sync of information technology and objectives and cultures of business. System integration is a process that helps in combining the component subsystems into single systems so that business process can be streamlined.
7. The usage of technology has increased at tremendous pace. The people have started making more use of computer for transferring online message through e-mails and many industries install tracking system for effective management. For example, one person can store all their details in the computer with highest security. Moreover, the use of technology will used at higher rate in coming future (Vojtáš, 2013).
8. The information system expert is necessary for design and implementation of system. They can provide valuable information about system’s pros and cons. On the other hand, the firm may require feasible hardware and software for the development of system.
9. The key implication is that systemic effects are involved in making interaction of information technology with other important components. Moreover, if changes are made in the component then it can have affect or impact all others. The information system is involved in organization in the form of computer system or any other monitoring device (Wang, 2013).
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