Chapter 2 – Strategy and Competitive Advantage

 

In this blog, Businesses need to think strategically. This means that they must have a long-term mindset to keep themselves ahead of the kerb. 

 

Information Systems are a great help in creating a strategic plan. This plan will largely be structured around dealing with both the internal and external environment influencing a business, and the pressures that these environments bring. For example, a business may change its structure by downsizing, upsizing or recruiting more staff. This must be accounted for in the business' strategic plan.
There are 3 main types of pressures that arise from the external environment:
- Technology pressures, which can be new advances or information overload
- Social/political/legal pressures, including social responsibility, laws and regulations, and ethics
- Market pressures, consisting of fluctuations in the global economy, competition and customers.

Information Systems (IS) can help deal with all these pressures. IS can help a business stay in front of all its information and ahead of rapid technological changes. IS can also help keep businesses socially responsible by making sure it is adhering to all laws and government regulations and staying ethical in its procedures. And IS offers proactivity when it comes to globalisation and a changing workforce, accounting for global markets and customers and being able to handle and facilitate a diverse workforce.


Now we've looked at how IS can help a business' strategy, we'll quickly look at how IS can create an advantageous situation over competitors.
IS can be a huge help when it comes to ordering stock. Using IS can make the input stage of a business extremely efficient, simplifying collection methods, while also making distribution to customers a sinch as well, easily keeping track of orders and deliveries. IS can also simplify and supercharge customisation, making it easy to mass-customise for customers. If you are the first to implement these advantages, it will place you in a great position over competitors. On top of this, IS can also help achieve:
- cost leadership by producing at minimal cost,
- differentiation by staying unique to your competitors,
- innovation by improving current products and creating newer, better products,
- operational effectiveness by simplifying procedures making processes more efficient and autonomous,
- customer orientation by focusing on what excels at satisfying customers.

Reference from:

 

Management Information Systems 1st Edition

Gray, H., Issa, T., Pye, G., Troshani, I., Rainer, R. K., Prince, B., & Hugh J. W. (2015). Management information systems. John Wiley.