Lecture 4 Strategy Flashcards
What is strategy in the context of business?
The future direction and actions of a company, focusing on approaches to achieve specific objectives and fundamental choices that align the organization with its strategy.
What does a business model focus on?
The value proposition addressing customer needs and delivering economic value.
What is IS/IT strategy?
A portfolio of information systems (IS) aligned with business strategy, aimed at creating competitive advantage.
Source: Ward and Peppard, 2002
What does strategic alignment refer to?
The process of aligning Information Systems (IS) strategy with business strategy to support and shape business operations.
What is the central question of business alignment in IS/IT strategy?
How can IS (strategy) support business strategy?
Example: How can Hema improve customer service using social media like Facebook?
What is Business Impact in IS strategy?
How IS can be used to shape and improve an organization’s productivity, competitiveness, and strategy through innovative use.
Example: De Volkskrant’s exploration of iPads and multimedia for their newspaper strategy.
What is a PEST(EL) analysis?
A framework for analyzing external factors affecting business strategy: Political, Economic, Social, Technological, Environmental, and Legal.
What are the components of the Political factor in PESTEL analysis?
Government policies, leadership changes, foreign trade policies, tax policy, and regulation trends.
What does the Economic factor in PESTEL analysis include?
Economic growth, inflation, unemployment rates, disposable income, and the impact of globalization.
What does the Social factor in PESTEL analysis cover?
Demographics, consumer attitudes, cultural trends, and population growth.
What does the Technological factor in PESTEL analysis consider?
Innovations and technological trends, such as AI, that affect production, distribution, and communication.
What are the Environmental factors in PESTEL analysis?
Issues related to sustainability, raw materials scarcity, pollution, and ethical business practices.
What does the Legal factor in PESTEL analysis cover?
Laws and policies affecting health, safety, advertising standards, consumer rights, and product safety.
What is Porter’s Five Forces model?
A framework for analyzing competitive dynamics within an industry to assess its attractiveness and identify threats and opportunities.
What does the Degree of Existing Rivalry refer to in Porter’s Five Forces?
The intensity of competition among current firms, influenced by the number of competitors, growth rates, and product differentiation.
What is the Threat of Potential Entrants in Porter’s Five Forces?
The likelihood of new competitors entering the industry, influenced by barriers like startup costs and brand loyalty.
What is the Bargaining Power of Suppliers in Porter’s model?
The influence suppliers have over firms, depending on the number of suppliers and the uniqueness of their products.
What is the Bargaining Power of Buyers in Porter’s model?
The power buyers have over firms, shaped by the number of buyers, product differentiation, and switching costs.
What does the Threat of Substitutes refer to in Porter’s model?
The risk that alternative products or services could replace the industry’s offerings.
What are complements in Porter’s Five Forces?
Products or services that enhance the appeal of another product.
What are the four competitive strategies in Porter’s model?
Cost Leadership
Differentiation
Industry-wide
Focus
What is the Cost Leadership strategy in Porter’s model?
Competing by being the cheapest in the industry (e.g., Lidl, Aldi).
What is the Differentiation strategy in Porter’s model?
Competing by offering unique products or services (e.g., Apple).
What does the Focus strategy in Porter’s model involve?
Focusing on a specific target market rather than a broad industry approach.
What are Tracy & Wiersema’s three value disciplines?
Product Leadership
Operational Excellence
Customer Intimacy
What is the Product Leadership value discipline of Tracy & Wiersema Value Disciplines
Focus on creating the best possible products.
What is the Operational Excellence value discipline Tracy & Wiersema value disciplines?
Focus on minimizing costs and improving efficiency (e.g., Lidl).
What is the Customer Intimacy value discipline of Tracy & Wiersema value disiplines
Focus on delivering superior customer experiences.
What does SWOT stand for?
Strengths, Weaknesses, Opportunities, and Threats.
What is the purpose of a SWOT analysis?
To analyze internal (Strengths, Weaknesses) and external (Opportunities, Threats) factors in a business.
What is the Balanced Scorecard used for?
A tool for translating strategic objectives into concrete projects, focusing on four pillars: financial, customer, internal processes, and learning & growth.
What is McFarlan’s Strategic Grid?
A framework for evaluating the strategic importance of IS in an organization.
What are the four segments of McFarlan’s Grid?
Strategic
Turnaround
Factory
Support
What is the Strategic segment in McFarlan’s Grid?
IS systems critical for competitive advantage, requiring future investment.
What is the Turnaround segment in McFarlan’s Grid?
IS systems not crucial now, but future investment could enhance competitive position.
What is the Factory segment in McFarlan’s Grid?
IS systems essential for operations, but no further investment is expected to improve competitiveness.
What is the Support segment in McFarlan’s Grid?
IS systems used for cost reduction or efficiency, with no strategic importance.
What is stakeholder analysis?
A process to identify, evaluate, and prioritize stakeholders based on their interests and influence on the firm.
What are the steps in Stakeholder Analysis?
Identify stakeholders
Determine interests
Assess influence
Prioritize stakeholders
What are the components of a BIS (Business Information Strategy) strategy?
Business Information Strategy
IS Functionality Strategy
IT Strategy
What are the stages in Nolan’s Six-Stage Maturity Model?
Initiation
Contagion
Control
Integration
Data Administration
Maturity
