MIS
Chrisyanqu
CourseSlidesCh2.pptxManagement Information Systems
Chapter 2 Strategy and Information Systems
Study Questions:
Q2-1 How does organizational strategy determine information systems structure?
Q2-2 What five forces determine industry structure?
Q2-3 How does analysis of industry structure determine competitive strategy?
Q2-4 How does competitive strategy determine value chain structure?
Q2-5 How do business processes generate value?
Q2-6 How does competitive strategy determine business processes and the structure of information systems?
Q2-7 How do information systems provide competitive advantages?
Q2-8 2029?
Q1: How Does Organizational Strategy Determine Information Systems Structure?
Q2: Industry Structure Porter’s Five Forces Model
Examples of Five Forces
| Force | Example of Strong Force | Example of Weak Force |
| Bargaining Power of Customers | Toyota as a customer to purchase auto paint from it’s supplier | Your bargaining power over the university policies and procedures |
| Threat of substitutions | Frequent traveler’s choices of auto rental | Patients with special disease choosing the only drug effective |
| Bargaining power of suppliers | Textbook providers deciding the price of textbooks | The bargaining power of the Chinese manufacturers over Walmart |
| Threat of new entrants | Corner latte stand facing strong threats | Professional Football teams |
| Rivalry | Used car dealers, real estate agents, Chinese manufacturers, etc. | Internal Revenue Service |
Q3: Industry Structure Determines Competitive Strategy
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Q4: Porter’s Value Chain Model
Value Chain is a network of value-creating activities (primary and support activities)
Margin and Linkages:
Margin:
= value created by each activity less the cost of the activity
Company strive for margins by either improving the value or reducing the cost.
Primary activities are those directly create value
Support activities are those indirectly create value
Linkage
Interactions across value activities
It pushes people to think outside their silos, streamlining business processes to create higher value, or reduce costs.
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Example of Value Chain Structure
Q5: How do Business Processes Create Values?
Business Process: a network of activities that generate value by transforming inputs into outputs.
Business Process Redesign by integrating data and
providing better information.
Old Process with silo database
New Process with linked database
Q6: How Business Processes are affected by competitive strategies?
To sum up, all IT/IS investments must align
with the strategic goals of your business!
Process
Implementations
Product
Implementations
Q7: How do IS/IT provide competitive advantages?
Researchers have identified the following eight ways to increase competitive advantages:
Create a new product or service
Enhance products or services
Differentiate products or services
Lock in customers and buyers
Lock in suppliers
Raise barriers to market entry
Establish alliances
Reduce costs
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