Enhancing Competitive Advantage with Information Systems
School
Stockton University**We aren't endorsed by this school
Course
MGMT 3121
Subject
Information Systems
Date
Dec 10, 2024
Pages
5
Uploaded by AdmiralValor15966
––Chapter 2 - Gaining Competitive Advantage Through Information SystemsOrganizational Decision-Making Levels: - Operational LevelWho: Foreman and SupervisorsWhat:Automate Routine and Repetitive Activities and EventsWhy:Improve Organizational Efficiency- Routine, day to day business procedures- Transactions- Focus on efficiency - faster, lower cost, less time, less effort- Very structured decisions-Managerial LevelWho:Midlevel managers & functional managersWhat:Automate the Monitoring and Controlling of Operational ActivitiesWhy:Improve Organizational Effectiveness- Focus on effectiveness - Semistructured decisions- Key Performance Indicators (KPIs)-Executive/Strategic LevelWho:Executive-Level ManagersWhat: Aggregate Summaries of Past Organizational Data and Projections of the FutureWhy: Improve Organizational Strategy and Planning- Top-level- Focus on long-term strategic questions facing the organization- Unstructured decisions - IS provides KPIs to assist with strategic planningDoing Things BetterDoing Things FasterDoing Things SmarterFirms have a competitive strategyInformation systems should be implemented that support the strategySources of Competitive Advantage
- Quality- Service- Low Cost- Proprietary- Innovation- Brand- ValueLevel of Industry Competitiveness - Rivalry Among Existing Firms- Threat of New Entrants- Bargaining Power of Suppliers- Threat of Substitute Products or Services- Bargaining Power of BuyersValue ChainTechnology/Strategy Fit- maximize business/IT alignment- matching IT investment Assessing Value- Economic Value- Architectural Value- Operational Value- Regulatory and Compliance ValueBusiness Models in the Digital World- A business model reflects the following:
1.2.3.4.5.●●●What does a company do?How does a company uniquely do it?In what way (or ways) does the company get paid for doing it?What are the key resources and activities needed?What are the costs involved?A summary of a business’s strategic direction that outlines how the objectives will be achievedA business model specifies the value proposition, as well as how a company will create, deliver, and capture value.Determine how to generate revenue. A revenue model describes how the firm will earn revenue, generate profits, and produce a superior return on invested capital.Freeconomics: Free Products Are the FutureFree doesn’t mean no profitApproachWhat it MeansExamplesAdvertisingFree services are provided to customers and paid for by a third party⿏Yahoo!’s banner ads⿏Google’s pay-per-clickFreemiumBasic services are free; a premium is charged for special features⿏Skype⿏Dropbox.comCross subsidiesSale price of one item is reduced inorder to sell something else of value⿏Comcast DVR⿏Free cell phone with two-year contractZero Marginal CostProducts are distributed to customers without an appreciable cost to anyone⿏iTunes music distribution⿏Software distribution⿏YouTube Video contentLabor ExchangeThe act of customers using free services creates value⿏Yahoo!Answers⿏Answers.com
○◆◆◆◆○◆◆◆○◆◆◆○◆◆◆○◆◆◆○○○○○Gift EconomyPeople participate and collaborateto create value for everyone⿏Open source software⿏WikipediaInternational Business StrategiesHome ReplicationFocused domesticallyInternational business is an extensionFocus on local customersInability to react to local market conditionsGlobalCentral organization, standardized offerings across markets, homogenous marketsStandardized products, economies of scaleInability to react to local market conditionsMulti-domesticDecentralized federation, heterogenous marketsQuick Reaction to changing local market conditionsDiffering products, lack of economies of scale, limited communication and knowledge sharingTransnationalBoth centralized and decentralized components, integrated network and marketBenefits of both multi-domestic and global strategiesHighly complex, difficult to manageValuing InnovationsSuccessful Innovation is DifficultInnovation is Often FleetingInnovation is Often RiskyInnovation Choices Are Often DifficultOrganizational Requirements for InnovationProcess RequirementsResource RequirementsRisk Tolerance RequirementsPredicting the Next New ThingMany innovations can be copiedSome innovations deliver longer advantages
◆◆High levels of customer investment in proprietary systems; high switching costsTechnologies that are very difficult to copyDisruptive InnovationsImplementing the Innovation Process•Choosing Enabling/Emerging Technologies•Matching Technologies to Opportunities•Executing Business Innovation for Growth•Assessing ValueInvestments in Disruptive Innovations•Put Technology Ahead of Strategy•Put Technology Ahead of Marketing•Innovation is Continuous