“the analyses, decisions, and actions an organisation undertakes in order to create and sustain competitive advantage”.
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what is strategy (5)
• The direction and scope of an organisation over the long-term • A set of actions to achieve the long-term goal • May be explicit or implicit • Can be planned or emergent • Most successful organisations relentlessly pursue a focused strategy
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1. what happens when there is no I.T strategy?
Missed opportunities for additional sales on the sell-side and more efficient purchasing on the buy-side
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2. what happens when there is no I.T strategy?
Fall-behind competitors in delivering online services – may become difficult to catch-up, for example, Tesco, Dell
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3. what happens when there is no I.T strategy?
Poor customer experience from poorly integrated channels
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strategic goals can be simple ( 3 examples)
• “A computer on every desk” • “Always low prices” • “Organise the world’s information
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synergy
the interaction or cooperation of two or more organizations, substances, or other agents to produce a combined effect greater than the sum of their separate effect
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using IS to acheive competitve advantage
•Information systems can improve overall performance of business units by promoting synergies and core competencies
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what are the components of the 5 force model?
(rivalry among existing competitors) supplier power, threat of new entrants, buyer power, threat of substitutes
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suplier power def
– these people making these programmes are in high demand
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buyer power def
buyers have a lot of power in the cable industry – e.g. they can change the channel without control from anyone else
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cost stratrgy - focused startegy example
e.g. Tesco has used correlation between data and sales expectations – e.g. how much ice cream will I need in my store in a week? – they used weather data - THEY HAVE SAVED A LOT OF MONEY FROM DOING THIS
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cost strategy - cost leadership example
e.g last year it was hot weather from may to October – when people waned fans there were none because this wasn’t expected – they lost a lot of money. but now the use of data weather avoids this problem
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1. strategic uses of IT
1. IT can reduce barriers to entry and create barriers to entry – e.g. Priceline patented reverse auction system/Airline loyalty programs
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2. strategic use of IT
IT can lock-in buyers and provide product differentiation – e.g. amazon kindle
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3. Strategic use of IT
3. IT can create new channels to market e.g. online gambling
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Strtegic values of I.T - tangiable (4)
o Increased sales or profits o Increased market share o Improved efficiency o Decreased operations costs
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strategic values of I.T - intangible (4)
o Improved information (decision making) o Improved communications o Increased effectiveness and flexibility o Improved brand image
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virtual company startegy
–Virtual company uses networks to ally with other companies to create and distribute products without being limited by traditional organisational boundaries or physical locations
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Using IS to Develop Competitive Strategies (network economies) (3)
– Marginal cost of adding new participant almost zero, with much greater marginal gain – Value of community grows with size – Value of software grows as installed customer base grows
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Using IS to develop comp strategy (virtual company strategy)
– Virtual company uses networks to ally with other companies to create and distribute products without being limited by traditional organisational boundaries or physical locations
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Using IS to Develop Competitive Strategies (business ecosystems)
– Industry sets of firms providing related services and products e.g. microsoft
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disruptive techonology definition
Disruptive technologies are substitute products that perform as well as or better (often much better) than anything currently produced
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Some types of strategy are...
cost, differentiation, lockin, and alliances
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Other cards in this set
Card 2
Front
what is strategy (5)
Back
• The direction and scope of an organisation over the long-term • A set of actions to achieve the long-term goal • May be explicit or implicit • Can be planned or emergent • Most successful organisations relentlessly pursue a focused strategy
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