Information and Competitive Advantage

This topic Dr. Roya have teach about to understand how competitive advantage is created is critical to the development of a firm. Dr. Roya also given explanation to identify basic competitive strategies and explain how a business can use information technology (IT) to confront the competitive forces.

Information technology (IT) plays a major role in reengineering most business processes firstly it can substantially increase process efficiencies, information technology also can improves communication. In addition, information technology also can give facilitates collaboration. Information technology can change the way businesses compete. When use IT in strategic information system that can help organization in gain a competitive advantage, reduce a competitive advantage and it can also meet other strategic enterprise objectives.

In this topic also can learnt about competitive strategies. Competitive strategies is on industry structure and competitor analysis in a variety of industry environments, through it contains many implication for competitive advantage (Micheal E. Porter, 1985).  Five competitive strategies is explain about cost leadership, differentiation strategy, innovation strategy, growth strategy and alliance strategy. Firstly about cost leadership is generating an advantage by producing at a lower cost and the increase profit margins. Differentiation strategy is about differentiate a firm’s products from its competitors it also focus on a particular segment.

 Before learnt about competitive strategies it must learnt about competitive force. Competitive force is a part in competitive advantage. According Wikipedia, competitive force is group of firm that market their product by offering consumers greater value with lower price and providing greater benefit and service to client.

According Michael Porter's Five Forces Model explains that there are five forces that determine industry attractiveness and long-run industry profitability. These is competitive force is  first rivalry of competitors within its industry is more intense where there are many small or equally sized competitors; and rivalry is less when an industry has a clear market leader. Second is new entrants into an industry and its markets can give an effect the level of competition whereby reduce customer dependence on the existing company. Next is substitute products that may capture market share is a product from another industry that offers similar benefits to the consumer as the product produced by the firms within the industry. Next is bargaining power of customers is about people create demand in organization. Lastly is bargaining power of suppliers supply material and other product into the organization.

As a conclusion, competitive advantage also have force and that force can reduce when we have good strategy. So, I must study a lot about this topic to get more knowledge that can give me advantage to manage my job in future.