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Lesson 5.1

A strategic information system uses information technology to help an organization gain a competitive advantage, reduce disadvantages, and meet strategic objectives. Michael Porter identified four competitive strategies: cost leadership, differentiation leadership, cost focus, and differentiation focus. Porter's five forces model examines threats from new entrants, suppliers, customers, substitutes, and existing competitors. An information system strategy supports communication, record keeping, decision making, and data analysis to improve operations and gain a competitive edge. Business process reengineering involves radically redesigning core processes to dramatically improve productivity, cycle times, and quality.

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Christian Mendoza
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38 views13 pages

Lesson 5.1

A strategic information system uses information technology to help an organization gain a competitive advantage, reduce disadvantages, and meet strategic objectives. Michael Porter identified four competitive strategies: cost leadership, differentiation leadership, cost focus, and differentiation focus. Porter's five forces model examines threats from new entrants, suppliers, customers, substitutes, and existing competitors. An information system strategy supports communication, record keeping, decision making, and data analysis to improve operations and gain a competitive edge. Business process reengineering involves radically redesigning core processes to dramatically improve productivity, cycle times, and quality.

Uploaded by

Christian Mendoza
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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INFORMATION

SYSTEM FOR
STRATEGIC
ADVANTAGE
SYSTEM
 Are information systems that are developed
in response to the corporate business
initiative. They are intended to give a
competitive advantage to the organization.
A strategic information system is any information
system that uses IT to help an organization
 Gain a competitive advantage
 Reduce a competitive disadvantage
 Meet other strategic enterprise objectives
COMPETITIVE STRATEGY CONCEPTS
Competitive strategy is a long-term
action plan of a company which is directed
to gain competitive advantage over its
rivals
Michael Porter, a professor at Harvard
presented competitive strategy concept.
According to him there are four types of
competitive strategies that are
implemented by businesses globally.
COMPETITIVE STRATEGY CONCEPTS
4 types of Competitive Strategy
Cost Leadership Strategy
Differentiation Leadership Strategy
Cost Focus Strategy
Differentiation Focus Strategy
Michael Porter’s model of competition:
 Threat of new entrants into an industry and its
markets
 The bargaining power of suppliers
 The bargaining power of customers
 The threat posed by substitute products that
may capture market share
 The rivalry of existing competitors within its
industry 
INFORMATION SYSTEM STRATEGY 
 Is an essential feature in the corporate
and information technology (IT) world. In a nutshell, it helps
firms and companies to allocate, store, process data, and move
the data and information they develop and receive.
Its role is to support the key aspects of running an organization,
such as;
 Communication,

 Record-Keeping,

 Decision Making,

 Data Analysis 

Companies use this information to;
 improve their business operations,

 make strategic decisions and

 gain a competitive edge.


SILO MENTALITY 
 A reluctance to share information with employees
of different divisions in the same company.
Here are five (5) ideas to get you started on
breaking down business silos.
1. Implement systems for file collaboration
2. Design a mobile device management strategy
3. Create a global view of your workforce
4. Encourage open dialogue
5. Invest in education
HOW DOES YOUR ORGANIZATION CREATE
VALUE?
How do you change business inputs into
business outputs in such a way that they
have a greater value than the original cost
of creating those outputs?
It's a matter of fundamental importance to
companies because it addresses the
economic logic of why the organization
exists in the first place.
THE VALUE THAT'S CREATED AND CAPTURED BY A
COMPANY IS THE PROFIT MARGIN:
 Value Created and Captured – Cost of Creating
that Value =Profit Margin
The more value an organization creates, the more
profitable it is likely to be. And when you provide
more value to your customers, you build a
competitive advantage.
 A value chain is a set of activities that an
organization carries out to create value for its
customers.
Porter proposed a general-purpose value chain that
companies can use to examine all of their activities
and see how they're connected.
PRIMARY ACTIVITIES (VALUE CHAIN ANALYSIS)
Primary activities relate directly to the physical creation, sale,
maintenance, and support of a product or service.
They consist of the following:
 Inbound logistics – These are all the processes related to
receiving, storing, and distributing inputs internally.
 Operations – These are the transformation activities that change
inputs into outputs that are sold to customers.
 Outbound logistics – These activities deliver your product or
service to your customer.
 Marketing and sales – These are the processes you use to
persuade clients to purchase from you instead of your
competitors.
 Service – These are the activities related to maintaining the
value of your product or service to your customers, once it's
been purchased.
REENGINEERING BUSINESS PROCESSES
The practice of rethinking and redesigning
the way work is done to better support an
organization's mission and reduce costs.
Business Process Reengineering involves
the radical redesign of core
business processes to achieve dramatic
improvements in productivity, cycle times,
and quality.
 
THE SIX KEY STEPS OF BUSINESS
PROCESS REENGINEERING
Define Business Processes.
Analyze Business Processes.
Identify and Analyze Improvement
Opportunities.
Design Future State Processes.
Develop Future State Changes.
Implement Future State Changes.
THANK YOU FOR
LISTENING

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