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Organizational Strategy and Competitive Advantage
BSAD 141
Dave Novak
BDIS: 1.2 (13-26)
Lecture Outline
Business Strategy
Competitive Advantage
Goals versus Objectives
Porter’s 5 Forces Model
Value Chains
How do information systems fit in?
Business Strategy
What is a “business strategy”?
Business Strategy
Is it important for employees to know the organizational “business strategy”?
Business Strategy
Difference between goals and objectives
Examples of Goals
Developing new products or services
Entering new markets
Increasing customer loyalty
Attracting new customers
Increasing sales
Examples of Objectives
First, identify a particular goal
For example, increasing customer loyalty
Second, identify measurable, focused indicators of customer loyalty that can be used to determine whether you are actually meeting your goal
Examples?
Competitive Advantage
A feature of a product or service that customers value very highly or more highly than they do for similar features provided by their competitors
Could be a unique product or service but doesn’t have to be unique
How do you determine “better”?
Identifying Competitive Advantages
Competitive intelligence –The process of gathering information about the competitive environment to improve the company’s ability to succeed
First-mover advantage – Occurs when an organization can significantly impact its market share by being first to market with a competitive advantage
Competitive Strategy
Competitive Strategy
Source: Kroenke, Experiencing MIS, 2008
Porter’s 5 Forces Model
A framework for analyzing the competitive forces in the environment in which an organization operates
Evaluate the attractiveness in terms of entering into a particular industry
Assess potential for profit
Porter’s 5 Forces Model
1) Buyer/Customer Power
The ability of buyers to influence the price of an item
High when customers have ability/power to (lower) prices
Switching cost – Manipulating costs that make customers reluctant to switch to another product
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