chapter 3 study guide

how managers make decisions

they look at the competitive situation in their industry and then consider ways of coping and suceeding in that enviornment

porters cometitive forces model

customer power: how buyers can effect prices for goods and services

supplier power:ability of suppliers to influence the amount they charge for supplies

Threat of new entrants: alternative products avaible for less then customers

threat of goods and services:how easy for another company to enter your market

rivlary among competitiors: threat is high wehn competition is strong in a market and low when competitors are complacent

importance of aligning IT with business objectives

identify business goals and strategies 

break strategic goals into concrete activitites 

identify metrics for measuring progress 

measure actual performance 

imact of global interent on business

scale economies 

resource cost reduction 

higher utilzation rates 

fixed capital costs lower cost per unit of production 

speeding time to market 

enabling new products and services to emerge as substitutes for existing products and services 

business process management(BPM)

1. identify processes for change

2. analyze existing processes

3. design new process

4. implement new process

5. continuous measurement

distruptive technology and impact on companies

tech with distruptive imact on industries and businesses rendering existing products, services and business models

value chain

analyzes an organization as a series of business processes where each adds value to the companys products or services 

(primary activities, inbound logistics, operations, sales marketing, service, outbound logisitcs) 

value web

s a dynamic network of interconnected organizations, partners, suppliers, and customers that collaborate to create and deliver value through shared resources, information, and processes.

strategies for dealing with competive forces

align IT with business objectives

low cost leadership

product differentiation

forcus on market niche

strengthen customer and supplier intimacy

global internet and business

enabling new products and services to emerge as substitutes 

changes to balance of power of customers and suppliers 

reduction of barriers to entry 

transformation/ destruction of industries 

BPR

far-reaching change

elimination of old processes replacement with new processes