7_competitivestrategyconcepts
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8/7/2019 7_CompetitiveStrategyConcepts
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COMPETITIVE STRATEGIC
CONCEPTS
Presented by:
Dr. Alok Bansal
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Competitive Strategy: The CoreConcepts
Competition is at the core of the success orfailure of firms.
A firm can survive and succeed in the longrun if it successfully develops strategies toconfront five competitive forces that shapethe structure of competition in its industry.
Competitive strategy aims to establish aprofitable and sustainable position against
the forces that determine industrycompetition.
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Information System and CompetitiveStrategy
The five forces determine industryprofitability because they influence the
prices, costs, and required investment offirms in an industry -- the elements of return
on an investment.
To gain competitive and profitable positionand for the successful survival, firms useInformation System.
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Competitive Strategiesbased on
Information Systems
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1. Lower Cost Strategy
Use IT to reduce cost of business processes.
Use IT to Lower the cost of customer or
suppliers. Sources of cost advantage are pursuit of
economies of scale, proprietary technology,
and preferential access to raw materials.
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2. Differentiate
Differentiation can be based on the
Product
Services IT features
Delivery system Marketing approach
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3. Innovate
Creating new products & services thatinclude IT components.
Developing market niche with the help of IT. Changing business process with the help of
IT.
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4. Promote Growth
Use IT to manage Regional & Globalbusiness expansion.
Use IT to diversify & integrate into otherproducts & services.
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5. Develop Alliances
The way in which interrelationships amongbusiness units can be used to create a
competitive advantage.
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6. Improve Quality and Efficiency
Use IT to dramatically improve the quality ofproduct & services.
Use IT to make continuous improvements tothe efficiency of business process.
Shorten the time needed to develop ,
produce & deliver the product & servicesusing IT.
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7. Build an IT Platform
Technology is pervasive in the value chainand plays a powerful role in determining
competitive advantage, in both cost anddifferentiation.
Build a strategic base of internal & external
data using IT.
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8. Other Strategies
Use Inter organization Information System tocreate switching cost that lock in customers n
suppliers. Build Entry barriers with the use of IT.
Use IT component to make substitute
product unattractive.
Help, create, share & manage business
knowledge via IT.
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THANK YOU
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a1 © Copyright Protected © Please does not circulate the above material without prior permission of Dr. Alok Bansal.alokbansal75@yahoo.comadmin, 12/28/2009
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