How information gives you competitive advantage


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How information gives you competitive advantage

  1. 1. How information givesyou competitiveadvantage Presented by : sandeep Gunjan Abhinabh Shikhar Rishabh Jain Sidhant Serawat 1
  2. 2. IntroductionInformation revolution It changes industry structure and therefore the rule of competition it creates competitive advantage by giving companies new way to outperform their rivalsIt spawns whole new businesses 2
  3. 3. DiscussionWhy IT has acquired significance and how it is affecting all businessHow the new technology changes the nature of competitionOutline a procedure that managers can use to assess the role of IT in their business 3
  4. 4. Strategic SignificanceValue chain An important concept that highlights the role of information technology incompetition is the “value chain”. Firm Support of entire value chain eg: planning, financing, infrastructure accounting, QM Human resource management Recruiting, Hiring, Training & Development Technology development Improving product & manufacturing process Procurement Purchasing unit Inbound Operations Outbound Marketing Service logistics logistics and sales Margin Material Transferring Storing and Sales To receiving, sto input into maintain Distributing & ring & finished and 4 distributing to goods products Promotion enhance manufacturin the g premises prodcut
  5. 5. Strategic Significance (cont.)Transforming the value chain • It generates more data about activities and products . Information that was not available before . There is a higher information content now • It enhance the linkage between both inside and outside the company • It allows companies to coordinates activities in widely dispersed geographical location 5
  6. 6. Transforming value chain Information technology is permeating the value chain at every point, transforming the way value activities are performed and the nature of the linkages among them. Firm Creating Planning models & linkage infrastructure Human resource Online Hiring & training. management Technology Computer-aided design Electronic market research development Procurement On-line procurement of partsSupport Automated Flexible Automated Telemarketing Remote Margin warehouse manufacturing order servicing ofactivities Remote equipment processing terminals for salespersons Computer scheduling Inbound Operations Outbound Marketing Service logistics logistics and sales Primary activities 6
  7. 7. Strategic Significance (cont.) Transforming Product It give power to enhance the quality of current product and servicesProduct & services Past Present= Physical component Physical component > Physical component < + Product drive information Product drive information information 7
  8. 8. Changing the nature of competition Information technology is changing the rules of competition in three ways: • Changing industry structure • Creating competitive advantage • Spawning new businesses 8
  9. 9. Changing the nature of competitionChanging industry structure System to connect Threat of new buyer and supplier entrance Bargaining power of suppliers Rivalry among existing competitors Bargaining power of buyers Automated Quotes Threat of substitute For easier comparison product or services CAD makes it easier To product offering Five competitive forces 9
  10. 10. Changing the nature of competition Changing the nature of competition Competitive AdvantageCost advantage Differentiation advantageCost lowering: wide set information provides opportunity to reduce excessive expense at any part of value chainEnhancing differentiation: IT make it possible to customize the product. 10IT basically helps in redefining the relationship between competitivescope and advantage
  11. 11. Changing the nature of competitionSpawning new businessThe information revolution is giving birth to completely newindustries in three distinct ways: 1. IT makes new businesses technologically feasible. 2. IT can also spawn new businesses by creating derived demand for new products. 3. IT creates new businesses within old ones. 11
  12. 12. Competing in the age of informationFollowing steps are required:• Assess information intensity• evaluate on the basis of value chain or product.• Predict the impact of IT• Identify and rank the way in which IT might create competitive advantage• To investigate how it might spawn new business• Develop a plan to take advantage 12
  13. 13. Thank you 13