Information Systems Management the Measure Journal

Excerpt from Journal :

Information technologies are the catalyst that unify these diverse areas of a business model together and have the potential to accelerate the business more quickly on key criterion including new product development, higher levels of customer satisfaction, and more efficiency in managing supply chains to forecast. The catalyst of any successful business model, whether being re-defined for business decades old, or a start-up that has just launched, is the need for using information technologies as a conduit for listening to the customer.

The paradox many businesses get caught up in when attempting to stay in step with their customers and stay relevant by investing heavily in information technology is the mistaken belief that standardization of tasks and processes will yield increasingly lower costs as a business moves down an experience curve (Porter, 1986). In previous economic cycles during the 20th century where mass production and efficiency was the approach to minimizing costs and competing on price, this strategy may have worked for a decade, yet is no longer effective today. The many studies of how potent values-based differentiation is using the 7S's framework makes this point clear (D'Aveni, Canger, Doyle, 1995).

Disruptive business models must be firmly anchored in the value chains of the industries they are part of, and seek to augment, strengthen and increase the focus on customer needs better than any other competitor (Porter, 1986). The Determinants of Competitive Advantage or the Five Forces Model provides insights into how best to approach each aspect of competitive dynamics that must be taken into account when a given industry's dynamics are going through a transition based upon innovation (Porter, 2008).

Dr. Porter relies heavily in his earlier research on the concept of personal productivity being the only competitive advantage any nation or organization can rely on for the long-term (Porter, 1986). The Five Forces Model takes into account efficiency and performance gains that can be attributable to the experience effect of productivity gains based on cumulative learning that the Boston Consulting Group has promoted for decades and Dr. Porter acknowledges in his research (Porter, 2008).

Yet for disruptive innovation to occur and the full value of the 7S's framework to permeate an organization, the most critical decision is which generic strategy to choose as a business model and how best to use information technologies to support competitive differentiation. When this occurs the organization will become disruptive based on its ability to become a knowledge-sharing network as studies of the Toyota Production System indicate (Dyer, Nobeoka, 2000). Information systems in this context fuel disruption by creating entirely new and highly effective strategies for knowledge transfer and greater value creation through knowledge sharing. Even in the case of the current challenges the company has, knowledge sharing has helped to solve the problem.

Conclusion

Information systems must be the catalyst of disruption in a business model, keeping the focus on how better to deliver value to customers while concentrating on how to make the value chain agile. The tighter the synchronization between business, organizational, and it strategy, the greater the potential a firm has to be a disruptive force in an industry.

References

Richard a D'Aveni, Jonathan M. Canger, & Joseph J. Doyle. (1995). Coping with hypercompetition: Utilizing the new 7S's framework1. The Academy of Management Executive, 9(3), 45.

Jeffrey H. Dyer, & Kentaro Nobeoka. (2000). Creating and managing a high-performance knowledge-sharing network: The Toyota case. Strategic Management Journal: Special Issue: Strategic Networks, 21(3), 345-367.

Porter, Michael E.. (1986). Changing Patterns of International Competition. California…

Sources Used in Document:

References

Richard a D'Aveni, Jonathan M. Canger, & Joseph J. Doyle. (1995). Coping with hypercompetition: Utilizing the new 7S's framework1. The Academy of Management Executive, 9(3), 45.

Jeffrey H. Dyer, & Kentaro Nobeoka. (2000). Creating and managing a high-performance knowledge-sharing network: The Toyota case. Strategic Management Journal: Special Issue: Strategic Networks, 21(3), 345-367.

Porter, Michael E.. (1986). Changing Patterns of International Competition. California Management Review, 28(2), 9.

Michael E. Porter. (2008, January). The FIVE COMPETITIVE FORCES THAT SHAPE STRATEGY. Harvard Business Review: Special HBS Centennial Issue, 86(1), 78-93.

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