Achieving Competitive advantage with Information Systems

The information revolution is sweeping through our economy. No company can escape its effects. In any company, information technology has a powerful effect on competitive advantage in etiher cost or differentiation. The technologies affects value activities themselves or allows companies to gain competitive advantage by competitive forces, these are the competitive forces : Traditional competitors, new market entrance, subtitute products or services, customers and suppliers. If a company wants to get competitive advantage in the market, the company should set up strategies. These are generic strategies for dealing with competitive forces:

  1. Low-cost leadership : producing goods at lower costs with relatively the same   quality compared to its competitors.
  2. Product differentiation : creating a product with better features or performance.
  3. Focus on market niche : focus on a specific demogrpahic of customers, products and services.
  4. Strenghthen customer and supplier intimacy : build a good relationship with customer and supplier.

By using information technology, we can achieve competitive advantages in the market. Beside information technology, there are other things that can impact on competitive advantage, the Internet is one of the things. Internet can make a new opportunities for building brands and loyal customer bases. The specific activities were information systems have a strategic impact are in primay activites, support activities, benchmarking, best practices.There are the benefits of information revolution, these are the benefits:

  1. Scale economies and resources cost reduction
  2. Higher utilization rates,fixed capital cost
  3. Spending time to market

Because of the information revolution, information systems has some progress and it improving the quality of a business. Information systems helps business to reduce cycle time, simplify production process, use customer demands to improve products and services, improve design and precision and improve production precision and tighten production tolerances.

To achieve the competitive advantage, business should use the steps in Business Process Management. Business process management has five steps to aims to continously improve processes and these are the steps :

  1. Identify process for change
  2. Analyze existing processes
  3. Design new process
  4. Implement new process
  5. Continous measurement.

Oleh: Faiz Zhahir Bya & Gunawan Wang