Information system for competitive advantages

In this part, we will discuss basic competitive strategies and explain how a business can use IT to confront the competitive forces it faces and Identify several strategic uses of IT and give examples of how they give competitive advantages to a business

Information Technology plays a major role in re-engineering most business processes

1.       Can substantially increase process efficiency ( Help the workers to minimize the process so the time, money and effort can efficiently using)

2.       Improves communication

3.       Facilitates collaboration

• To succeed in organization, a business must develop strategies to

a.       competitors within its industry

b.      New entrants into an industry and its markets

c.       Substitute products that may capture market share

d.      Bargaining power of customers

e.      Bargaining power of suppliers

And this is Five competitive strategies that can support organization development:

1         Cost Leadership

´  Become low-cost producers

´  Help suppliers or customers reduce costs

´  Increase cost to competitors

´  Example: Priceline uses online seller bidding so the buyer sets the price. it will help the customer and producer to increase their capability to buy and get the efficient price for both parties.

Differentiation Strategy

´  Differentiate a firm’s products from its competitors’

´  Focus on a particular segment or niche of market

´  Example: The fashion industry which using online shop and not the development of their business will increase in online shop side because using the information technology, customers can search and buy he thing easier. the strategy marketing must be develop to make the identity for our company.

 Innovation Strategy

´  Unique products, services, or markets

´  Radical changes to business processes

´  Example: Amazon’s online, full-service customer systems. With the innovation which means different from the other competitors make our company unique and special and will interact the customers to buy from our company and success our business

Growth Strategy

´  Expand company’s capacity to produce

´  Expand into global markets

´  Diversify into new products or services

´  Example: Wal-Mart’s merchandise ordering via global satellite tracking.

 Alliance Strategy

´  Establish linkages and alliances with customers, suppliers, competitors, consultants, and other companies

´  Includes mergers, acquisitions, joint ventures, virtual companies

´  Example: Wal-Mart uses automatic inventory replenishment by supplier