1. Chapter2 COMPETING WITH INFORMATION TECHNOLOGY

2. Goal: Introduces fundamental concepts of competitive advantage through information technology and illustrates major strategic applications of information systems. Learning outcome: These chapters will prepare you to move on to study chapters on information technologies. Objective: – Identify several basic competitive strategies and explain how they use information technologies to confront the competitive forces faced by a business. – Identify several strategic uses of Internet technologies and give examples of how they can help a business gain competitive advantages. – Identify the business value of using Internet technologies to become an agile competitor or form a virtual company.

3. Content Fundamentals of Strategic Advantage – Competitive Strategy Concepts – Strategic Uses of Information Technology – Building a Customer-Focused Business Using Information Technology for Strategic Advantage – Reengineering Business Processes – Becoming an Agile Company – Creating a Virtual Company – Knowledge Management Systems

4. Competitive Strategy Concepts

5. Competitive forces: – The rivalry of competitors within its industry – The threat of new entrants into an industry and its markets – The threat posed by substitute products that might capture market share – The bargaining power of customers: Refers to the pressure consumers can exert on businesses to get them to provide higher quality products, better customer service, and lower prices. – The bargaining power of suppliers Basic Strategy: – Cost Leadership Strategy: Becoming a low-cost producer of products and services in the industry or finding ways to help suppliers or customers reduce their costs or increase the costs of competitors. – Differentiation Strategy: Developing ways to differentiate a firm’s products and services from those of its competitors or reduce the differentiation advantages of competitors. – Innovation Strategy: Finding new ways of doing business(developing unique products and services or entering unique markets). – Growth Strategies: Significantly expanding a company’s capacity to produce goods and services, expanding into global markets, diversifying into new products and services, or integrating into related products and services. – Alliance Strategies: Establishing new business linkages and alliances with customers, suppliers, competitors, consultants, and other companies.

6. Strategic Uses of Information Technology

7. Example

8. Other Strategic Uses of Information Technology

9. Building a Customer-Focused Business

10. The Value Chain and Strategic IS

11. Reengineering Business Processes

12. Example

13. Becoming an Agile Company How information technology can help a company be an agile competitor, with the help of customers and business partners.

14. Creating a Virtual Company

15. Knowledge Management Systems