University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 1 Methodology: Macro Level ‘Oh Mr Porter, What Shall I Do? I Want to Go to Birmingham, and They’re Taking Me to Crewe’.

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 2 Porter’s Five Competitive Forces Model

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 3 Porter’s Five Forces New Entrants. Customers.

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 4 Porter’s Five Forces Suppliers. Substitutes.

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 5 Porter’s Five Forces Industry Competition

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 6 Porter’s Three Strategies Differentiate Pile ‘em High Niche.

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 7 IT and Differentiation Otis elevators put computing power into their lifts to record problems, and track usage. The lifts can then be reprogrammed to offer better service at busy time. Result: growth of market share from 18% to 25% in three years.

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 8 IT and Differentiation Dun and Bradstreet provided on line access to their financial and business services for commercial organisations. This was quickly followed by major banks, who offered similar deals. Moral: competitive advantage does not last long

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 9 IT and Pile ‘em High …and sell ‘em cheap. The low-cost supplier wins. Newspapers and magazines are examples of computerised, lower cost production methods, calling in contributions from writers anywhere in the world.

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 10 IT and Pile ‘em High Advances in computer-aided manufacture. But note also the move to low-wage economies. No IT here...

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 11 IT and Niche American Hospital Supply found its niche in wholesale supply to the health care industry.

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 12 IT and Niche They provide electronic ordering and stock control facilities to their customers. Sounds easy. But how many businesses deliberately try to make their customers’ lives easier?

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 13 Conclusion This version of Porter’s approach is simplistic, but focuses the mind. Such solutions appeal to managers: so Porter ( and SWOT) are much used.

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 14 Conclusion Earl’s methodology, though, offers a more rounded and comprehensive analysis. But remember: no single method works for everyone!

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 15 Conclusion Retrenchment Go for Growth ‘It can’t happen to us’ Non-commercial Entities

University of Sunderland CIFM03 Quality and Information Systems StrategiesLecture 3 16 Porter’s Five Competitive Forces Model