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Strategic IT Deployment & SISs: Enhancing Competitive Edge - Key Insights

This chapter delves into the strategic deployment of IT and Strategic Information Systems (SISs) as potent tools for boosting competitive advantage in both private and public sectors. Understanding Porter’s competitive forces model is crucial to navigating the dynamic and highly competitive landscape of global markets. The chapter explores how IT can drive innovation, speed, service quality, and foster alliances for sustainable business success. It discusses how IS shapes competitive strategies outwardly through customer services, inwardly for employee productivity, and through strategic alliances like supply chain management. The analysis includes Porter’s competitive forces model, threats like new competitors, supplier and buyer bargaining power, and substitutes, along with value chain analysis. Additionally, the Porter & Millar's SIS process is detailed for leveraging IT to create competitive advantage and spawn new business opportunities. Various SIS applications such as cost leadership, differentiation, growth, and customer-oriented approaches are explored, emphasizing the importance of internal efficiency and innovation. The chapter poses critical discussion questions to evaluate the presence and implications of strategic information systems in organizations, touching on risk and ethical challenges in E-commerce implementation for large grocery stores. The assignments include reviewing technology guides, chapters, and research papers for deeper insights and practical application of the concepts discussed.

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Strategic IT Deployment & SISs: Enhancing Competitive Edge - Key Insights

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  1. Chapter 3 Strategic Information Systems

  2. Agenda • IT strategic deployment pressure • Strategic information systems (SISs) • Porter’s competitive forces model

  3. Pressure • Increase performance, not just marginally, but substantially • Private sector: • Highly competitive • Rapidly changing • Global markets • Public sector: • Improvement demand from taxpayers

  4. 1998 Study by Hackett Group • IT staff spend an average of 3 days/week administering day-to-day operations • Only 8% of IT staff focused on decision support or strategic planning for future use of IT technology • Half of application development for supporting revenue generating function • A third of application development for rebuilding administrative and support functions

  5. IT as Competitive Tool • Innovation (IT) • Speed (delivery) • Service (tailoring) • Quality (TQM) • Alliances (intranet, extranet)

  6. Agenda • IT strategic deployment pressure • Strategic information systems (SISs) • Porter’s competitive forces model

  7. Strategic Information Systems • IS supports or shapes a business unit’s competitive strategy for competitive advantage • Approaches • Outward (customer services) • Inward (employee productivity) • Strategic alliances (supply chain) • Competitive intelligence (internal & external information)

  8. Agenda • IT strategic deployment pressure • Strategic information systems (SISs) • Porter’s competitive forces model

  9. Porter’s Competitive Forces Model • Threat of new competitors • Bargaining power of supplies • Bargaining power of buyers • Threat of substitute product or services • Rivalry among existing firms

  10. Porter’s Value Chain Analysis Model • Primary activities • Inbound logistics (input) • Operations (manufacturing and testing) • Outbound logistics (storage and distribution) • Marketing and sales • Service (installation and repair)

  11. Porter’s Value Chain Analysis Model • Support activities • Firm infrastructure (accounting, finance, management) • Human resources management • Technology development (R&D) • Procurement • Value system • Increase efficiency, effectiveness, competitiveness

  12. Porter & Millar’s SIS Process • Access information intensity (usage) • Determine the role of IT in the industry structure (competitive forces) • Identify & rank IT in terms of creating competitive advantage • Investigate IT to spawn new business • Develop a plan for taking advantage of IT

  13. SISs Applications • Cost leadership • Differentiation • Growth • Time • Alliance • Innovation • Improve internal efficiency • Customer-oriented approaches

  14. Points to Remember • IT strategic deployment pressure • Strategic information systems (SISs) • Porter’s competitive forces model

  15. Discussion Questions • Is there any strategic information system in your organization? • Yes, name them. • No, can you suggest one or more? • What are the risk and ethical problems associated with implementing an E-commerce for a large grocery store?

  16. Assignment • Review technology guides 1-2 & chapters 1- 3 • Read chapter 4 • Group Assignment • Research paper

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