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¶ … Role in Alibaba Value Chain
IT role in Value Chain
With mounting pressures from market competitors driving ever-evolving business needs, firms are seen to increasingly count on information technology/systems for competitive advantage and attaining business agility. Differentiation can help achieve value creation throughout a business's value chain, via activities that create services and products that increase performance or reduce costs. Business information systems are pervasive and impact all points on a business value chain. Further, they also impact competitive scope, whilst reshaping how a business's offering fulfills consumer needs. All value activities of an organization possess an information processing element which incorporates steps needed for capturing, manipulating, and channeling requisite data for performing the activity (Role of IT in Michael Porter's Value Chain Framework, 2009).
Right from logistics activities to servicing, information systems carry out the functions of control and optimization, and hence, transform processes and products to provide more critical functions. They aid companies in redesigning manufacturing devices, promoting marketing, improving logistics operations, enhancing customer service, and boosting performance of products. They facilitate organizational globalization, establish industry attractiveness, and can influence industry structure through altering of every one of the 5 competitive forces. Information systems assist businesses in establishing competitive edge via cost-cutting...
Alibaba e-Business's information system generates significant value for Alibaba, and includes the areas of company finance, production, performance management, business intelligence and supply chain. Value creation expands to cover all primary and secondary value chain activities. Value creation in Alibaba's e-business systems occurs via:
Transactional efficiencies -- These are attained through distribution of cost reduction, inventory management restructuring, simplification of transactions enabling individual clients to enjoy the benefits of scale economies via bulk purchases and demand aggregation, supply chain streamlining, and speedier order fulfillment and transaction processing, thus benefiting customers as well as vendors (Role of IT in Michael Porter's Value Chain Framework, 2009).
Complementarities -- Alibaba and other e-businesses will be able to leverage value creation potential through offering complementary service/product bundles to clients (Role of IT in Michael Porter's Value Chain Framework, 2009).
Novelty -- New manufacturing methods, tapping new markets, designing new services or products, new marketing or distribution methods/channels, or innovation in business operations (or transaction restructuring) may create…
References
Alibaba: Company Overview. (n.d.). Retrieved April 20, 2016, from http://www.alibabagroup.com/en/about/overview
Role of IT in Michael Porter's Value Chain Framework. (2009). Retrieved April 20, 2016, from http://www.managedecisions.com/blog/?p=6
What is Alibaba? (n.d.). Retrieved April 20, 2016, from http://projects.wsj.com/alibaba/
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