Digital Technologies in Business Chapter 2 notes
Digital Technologies in Business Chapter 2 notes meta 16ss
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This 7 page Class Notes was uploaded by Jordan Calvert on Tuesday January 19, 2016. The Class Notes belongs to meta 16ss at The University of Cincinnati taught by Robert Rokey in Spring 2016. Since its upload, it has received 74 views. For similar materials see Digital Technologies in Business in Business at The University of Cincinnati.
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Date Created: 01/19/16
Technology in business Chapter 2 Notes -Competitive advantage: any assets that provide that provide an organization with an edge against its competitors in some measure such as cost, quality, or speed. It helps an organization control a market and get larger profits. Business Pressures -Business Environment: the combination of social, legal, economic, physical, and political factors in which businesses conduct their operations. Any change to any of these factors can create business pressures on organizations. Market Pressures -Market pressures are generated by the global economy, intense competition, the changing nature of the workforce, and powerful customers. -Globalization: the integration and interdependence of economic, social, cultural, and ecological facets of life, made possible by rapid advances in information technology. -The changing nature of the workforce is becoming more diversified, especially in developed countries. Increasing numbers of women, single parents, minorities, and people with disabilities are now employed in all types of positions. -Customer sophistication and expectations increase as customers become more knowledgeable about the products and services they acquire. Organizations recognize the importance of customer’s happiness. Technology Pressures -Technological innovation and obsolescence are technology pressures. Few and improved technologies rapidly create or support substitutes for products, alternative service options, and superb quality. (ex. Brand new models of phones, tablets, computers, ect being released). - Information overload caused by the amount of information available on the Internet doubles approximately every year. Societal/ Political/Legal Pressures - The third category of business pressures includes social responsibility, government regulation/deregulation, spending to protect against terrorism, and ethics. -Social issues that affect business and individuals range from the state of the physical environment, to company and individual philanthropy, to education. -organizational social responsibility/ individual social responsibility: Some corporations and individuals are willing to spend time and/ or money to address various social problems. -One critical social problem is the state of the physical environment. A growing IT initiative, called green IT, is addressing some of the most pressing environmental concerns. IT is instrumental in organizational efforts to “go green” in there areas: -Facilities design and management: organizations are creating more environmentally sustainable work environments. -Carbon management: As companies try to reduce their carbon footprints, they are turning to IT executives to develop the systems needed to monitor carbon throughout the organization and its supply chain. -International and U.S. environmental laws: IT executives must deal with federal and state laws and international regulations that impact everything from the IT products they by, to how they dispose of them, to their company’s carbon footprint. -Digital divide: refers to the wide gap between those individuals who have access to information and communications technology and those who do not. -Make-to-order: a strategy of producing customized products and services. -Mass customization: a company produces a large quantity of items, but it customizes them to math the needs and preferences of individual customers. -Competitive strategy: a statement that identifies a business’s approach to compete, its goals, and the plans and policies that will be required to carry those goals. -Competitive forces model: The best-known framework for analyzing competitiveness. Created by Michael Porter and used by companies to develop strategies to increase their competitive edge. -Porters 5 forces and the ways the web influences them: 1. The threat of entry of new competitors: the threat that new competitors will enter your market is high when entry is easy and low when there are significant barriers to entry. -entry barrier: a product or service feature that customers have learned to expect from organizations in a certain industry. 2. The bargaining power of suppliers: supplier power is high when buyers have few choices from whom to buy and low when buyers have many choices. Therefore, organizations would rather have more potential suppliers so that they will be in a stronger position to negotiate price, quality, and delivery items. 3. The bargaining power of customers (buyers): Buyer power is high when buyers have many choices from whom to buy and low when buyers have few choices. Loyalty programs reduce buyer power. 4. The 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. 5. The rivalry among existing firms in the industry: the threat from rivalry is high when there is intense competition among fewer firms and is not as intense. -Value chain: a sequence of activities through which the organization’s inputs, whatever they are, are transformed into more valuable outputs, whatever they are. -The value chain model: identifies points where an organization can use information technology to achieve competitive advantage. -Primary activities: relate to the production and distribution of the firm’s products and services. -Support activities: Unlike primary activities, support activities do not add value directly to the firm’s products or services. -Value system: a value system, or an industry value chain, includes the suppliers that provide the inputs necessary to the firm along with their value chains. -Business-information technology alignment: the tight integration of the IT function with the organization’s strategy, mission, and goals.
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