Class 3, chapter 5 from class Flashcards
what are the types of business pressures
Market Pressures
Technology Pressures
Societal/Political/Legal Pressures
market and economic pressures
global economy and strong competition
need for real time operations
changing workforce
powerful customers
technological pressures
information overload
technological innovations and obsolescence
Societal/Political/Legal Pressures
terrorist attacks and homeland security
ethical issues
compliance with government regulations and deregulations
social responsibility
do large organizations usually do calm innovation or radical disruptive innovation? why
they do it calm because they have too much to lose
do startups usually do calm innovation or radical disruptive innovation? why
radical innovation because they have nothing to lose
information overload
so much info out there its impossible for us to get it all
makes it difficult to make a decision as manager
what are the 3 areas IT assists in going green?
- Facilities design and management
- Carbon management
- International and U.S. environmental laws
what is the digital divide?
not everyone has same access to IT innovation
for ex: here in mtl, internet is gyuuu, but in the north of qc and Africa c’est dead
organizational responses to business pressures
Strategic Systems
Customer Focus
Make-to-Order and Mass Customization
E-Business and E-Commerce
strategic systems
think about and test and put in place different type of strategies to improve profits, negotiate with suppliers, and gaining market share
customer focus
going to try to restructure how people in and out of the organization think about the business
want to make people always think positive about the company
it requires everyone to properly know their role
Make-to-Order and Mass Customization
taking advantage of new technologies
being able to more easily provide small customizations of our different products
using AI, all kinds of different racking technologies, computers
E-Business and E-Commerce
taking advantage of capabilities of doing business online
covid boomed this even more
Porter’s Competitive Forces Model
- The threat of new competitors
- The bargaining power of suppliers
- The bargaining power of customers (buyers)
- The threat of substitute products or services
- The rivalry among existing firms in the industry
Micheal E. Porter
big influence in business
when is the threat from rivalry high?
when there is intense competition among many firms in an industry
threat of entry of new competitors
The threat that new competitors will enter your market is high when entry is easy
low when there are significant barriers to entry
barrier to entry
A product or service feature that customers have learned to expect from organizations in a certain industry
A competing organization must offer this feature in order to survive in the marketplace
Threat of Substitute Products or Services
If there are many alternatives to an organization’s products or services, then the threat of substitutes is high
If there are few alternatives, then the threat is low
switching costs
The costs, in money and time, imposed by a decision to buy elsewhere
ex: contracts with smartphone providers
ways to limit power of competitors or new entrants?
switching costs
barriers to entry
Bargaining Power of Suppliers
Supplier power is high when buyers have few choices from whom to buy
low when buyers have many choices
ability to negotiate with suppliers is crucial
Bargaining Power of Customers (Buyers)
Buyer power is high when buyers have many choices from whom to buy
low when buyers have few choices
something like elasticity
What composes Porter’s Value Chain?
support activities
primary activities
margin section
