Crucial Competitors and Partners
Why Are Strategic Advantage Models Essential to Planning for Information Systems? A general manager who relies solely on IS personnel to make IS decisions may not only give up any authority over IS strategy but also hamper crucial future business decisions. In fact, business strategy should drive IS decision making, and changes in business strategy should entail reassessments of IS. Moreover, changes in IS potential should trigger reassessments of business strategy—as in the case of the Internet when companies that understood or even considered its implications for the marketplace quickly outpaced their competitors who failed to do so. For the purposes of our model, the Information Systems Strategy Triangle, understanding business strategy means answering the following questions:
1. What is the business goal or objective?
2. What is the plan for achieving it? What is the role of IS in this plan?
3. Who are the crucial competitors and partners, and what is required of a successful player in this marketplace?
4. What are the industry forces in this marketplace?
Porter’s generic strategies framework and the dynamic frameworks (summarized in Figure 1.4) are revisited in the next few chapters. They are especially helpful in discussing the role of IS in building and sustaining competitive advantages (Chapter 2) and for incorporating IS into business strategy. The next section of this chapter establishes a foundation for understanding organizational strategies.
The answers to these questions inform the assessment of the organization’s use of IS. Chapters 3, 4, and 5 use the Managerial Levers model to assess the impact of information systems (IS) on the firm. Chapters 8 and 9 use this same list to understand the business and governance of the IS organization.
Brief Overview of Information Systems Strategy IS strategy is the plan an organization uses to provide information services. IS allow a company to implement its business strategy. JetBlue’s former Vice President for People explains it nicely: “We define what the business needs and then go find the technology to support that.”17
Business strategy is a function of competition (What does the customer want and what does the competition do?), positioning (In what way does the firm want to compete?), and capabilities (What can the firm do?). IS help
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