IS STRATEGY Flashcards
Porter’s Five Forces Theory
Threat of New
Entrants
Bargaining Power of
Suppliers
Rivalry
Among
Existing
Competitors
Threat of Substitute
Products or Services
Bargaining Power of
Buyers
potential entry barriers
- capital costs
- knowledge
- customer expectations
- network effects
- switching costs
Many versus few suppliers
– raising prices faster
– quality
– delivery schedules
Bargaining Power of Buyers
– attract and retain customers
– charge high prices
Factors FOR Bargaining Power of Buyers
– number of buyers and their price sensitivity
– switching costs
– product differentiation
Low-Cost Strategy:
Broad Market, Low-Cost Strategy:
Target Market: A large customer base.
Differentiation Strategy:
Broad Market and uniqueness
Low-Cost Strategy , narrow market:
Target Market: A specific niche or segment of the market.
Many versus few suppliers
– raising prices faster
– quality
– delivery schedules
business strategy
addresses both external and
internal domains
External domain
business environment of company, how to
differentiate from competitors
Internal domain
administrative structure + design of business
processes
why fit between internal and external domain is important ?
Fit between external and internal domain is critical
for maximizing economic performance
strategic integration
integrate IT strategy and
business strategy
Operational integration:
organizational
infrastructure and processes and IS infrastructure
and processes
