Chapter 2: IS, Organisations and Strategy

Question 1

What are Porter’s 5 Competitive Forces?

Answer 1

• Rivalry among existing competitors
• Threat of New Entrants
• Substitute Products
• Bargaining power of buyers
• Bargaining power of suppliers

Question 2

What are the basic strategies for dealing with competitive forces?

Answer 2

1. Low cost leadership
2. Product differentiation
3. Focus on market niche (long tail)
4. Increased intimacy with suppliers/customers

Question 3

What are business ecosystems?

Answer 3

Business ecosystem is a term for interdependent network of suppliers, distributors, outsourcing firms, transportation service firms and technology manufacturers

Question 4

What is meant by Business Value chain model ?

Answer 4

Business Value chain model highlights specific activities where competitive strategies can be best applied and where IS systems are most likely to have a strategic impact.

Question 5

What is servitization?

Answer 5

The servitisation of products describes the strategy of creating value by adding services to products or even replacing a product with a service.

Question 6

What is a value web?

Answer 6

A value web is a collection of independent firms that use IS to coordinate their value CHAINS to collectively produce a product/service.

Question 7

What is the difference between the aims of IS for primary and secondary activities in the business value chain?

Answer 7

IS for primary activities aims to increase value (logistics, marketing, sales, operations).
IS for secondary activities aims to reduce costs (infrastructure, HR, technology).