(01) Digital business strategy: toward a next generation of insights. Bharadwaj, A., El Sawy, O. A., Pavlou, P. A., & Venkatraman, N. V. (2013).. Flashcards
Over the last three decades, what was the prevailing view of information technology strategy?
the prevailing view of information technology strategy has been that it is a
functional-level strategy that must be aligned with the firm’s chosen business strategy. Even within this so-called alignment view, business strategy directed IT strategy.
Why do the writers of the article argue that the time is right to rethink the role of IT strategy, from that of a functional-level strategy—aligned but essentially always subordinate to business strategy—to one that reflects a fusion between IT strategy and business strategy?
Because of the fact that during the last decade, the business infrastructure has become digital with increased interconnections among products, processes and services.
Across many firms, spanning different industries and sectors, digital technologies are fundamentally transforming business strategies, business processes, firm capabilities, products and services, and key inter firm relationships in extended business networks.
Digital technologies = (viewed as combinations of information, computing, communication, and connectivity technologies)
What are the four key themes identified by the writers? (Memory aid (4 S))
(1) the (s)cope of digital business strategy
(2) the (s)cale of digital business strategy
(3) the (s)peed of digital business strategy
(4) the (s)ources of business value creation and capture in digital business strategy
memory aid: all themes start with S
What is the working definition of digital business strategy?
organizational strategy formulated and executed by leveraging digital resources to create differential value.
What 3 points does the definition of digital business strategy highlight?
(1) it goes beyond the traditional view, thinking of IT strategy as a function within firms and recognizing the pervasiveness of digital resources in other functional areas such as operations, purchasing, supply chain, and marketing;
(2) it goes beyond systems and technologies, which might have narrowed the traditional views of IT strategy to recognize digital resources, thereby being in line with the resource-based view of strategy
(3) it explicitly links digital business strategy to the creation of differential business value, thereby elevating the performance implications of IT strategy beyond efficiency and productivity metrics to those that drive competitive advantage and strategic differentiation.
What is meant by corporate scope?
The portfolio of products and businesses as well as activities that are carried out within a company’s direct control and ownership.
Why is it important to understand the scope of the digital business strategy?
Understanding the scope of digital business strategy helps to conceive its
relationship to firms, industries, IT infrastructures, the external environment, and how digital business strategy can be more effective in a variety of settings.
In the context of the scope of digital business strategy, what should researchers pay particular attention to? According to the writers.
researchers should pay particular attention to how, when, and why the scope of digital business strategy is impacted by digital technologies.
How is digital business strategy different from traditional IT strategy?
Digital business strategy is different from traditional IT strategy in the sense that:
it is much more than a cross-functional strategy, and it transcends traditional functional areas (such as marketing, procurement, logistics, operations, or others)
and various IT-enabled business processes (such as order management, customer service, and others).
Therefore, digital business strategy can be viewed as being inherently transfunctional.
The formulation of digital business strategy includes:
the design of products and services and their interoperability with other complementary platforms, and their deployment as products and services by taking advantage of digital resources.
Why do we need a re conceptualization of the role of digital connections within a firm’s corporate portfolio of products and services (its scope)?
to better prescribe its digital business strategy under increased digital conditions.
Why should digital resources around digital business strategy be viewed relatively broad?
This is because digital resources are “more than just bits and bytes, the digital infrastructure consists of institutions, practices, and protocols that together
organize and deliver the increasing power of digital technology to business and society” (Deloitte 2009, p. 2).
They include traditional data and information, but they also include
the significant explosion of data.
Explain how new portfolio of digital business
strategy approaches around the digitization of information for
products and services originated.
(This):
The proliferation (fast increase in usage) of social media, cloud computing, and mobile phones has enhanced the quality and quantity of data generated every day.
(Led to this):
big data create conditions of data (information) abundance due to the massive amount of detailed (and often ready to analyze) data made available
(which resulted in this):
This opens up a whole new portfolio of digital business strategy approaches around the digitization of information for products and services.
What are the key takeaways from theme (1): “the scope of digital business strategy”?
(1) Digital Business Strategy Transcends Traditional Functional and Process Silos
(2) Digital Business Strategy Includes Digitization of Products and Services and the Information Around Them
(3) Digital Business Strategy Extends the Scope Beyond Firm Boundaries and Supply Chains to Dynamic Ecosystems That Cross Traditional Industry Boundaries
How can organizations extand the range and reach of digital business strategy
beyond tight supply chains with partners in traditional industries to loosely coupled dynamic ecosystems?
(1) Rethinking of how to standardize IT infrasdtructure and business processes around them
(2) It also requires an orchestration of digital resources that is
more multifaceted, data rich, and dynamic.
(3) The digital dependencies may require a mindset that require pooling and sharing digital business strategy with other players in the business ecosystem, whether they are partners or competitors.
