1Q 2) Explain strategic MIS categories in detail.

Give illustration for each

category.
2Ans:
3Strategic MIS:
An organization’s strategy supported by information system fulfilling its
business objectives came to be known as Strategic Information System. The
strategic information
system consists of functions that involved gathering, maintenance and
analysis of data concerning internal resources, and intelligence about
competitors, suppliers, customers, government and other relevant
organizations.

Under Porter's framework, enterprises have four generic strategies available

to them whereby they can attain above average performance.
They are:
a) cost leadership;
b) differentiation;
c) cost focus; and
d) focused differentiation.
Porter's representation of them is indicated below

Porter's Four Generic Strategies (Porter 1980)

According to Porter, competitive advantage grows out of the way an

enterprise organizes and performs discrete activities. The operations of any
enterprise can be divided into a series of activities such as salespeople
making sales calls, service technicians performing repairs, scientists in the
laboratory designing products or processes, and treasurers raising capital. By
performing these activities, enterprises create value for their customers.

The ultimate value an enterprise creates is measured by the amount

customers are willing to pay for its product or services. A firm is profitable if
this value exceeds the collective cost of performing all of the required
activities. To gain competitive advantage over its rivals, a firm must either
provide comparable value to the customer, but perform activities more
efficiently than its competitors (lower cost), or perform activities in a unique
way that creates greater buyer value and commands a premium price
(differentiation).
As per Borden 1964, quoted in Wiseman 1988 many differentiation bases can
be classified as 4 P’s as given below:

• product (quality, features, options, style, brand name, packaging,

sizes, services, warranties, returns)
• price (list, discounts, allowances, payment period, credit terms);
• place (channels, coverage, locations, inventory, transport); and
• promotion (advertising, personal selling, sales promotion, publicity).
The various attributes listed above can be sharpened the firms product by
the support of a suitable information technology.

Strategy Company Strategic use of information Business benefits

technology

Cost lea Dell compute Online build to order Lowest cost producer
dership r Online seller bidding Buyer-set pricing
Priceline.com Online auctions
Auction-set prices
ebay.com
Different AVNET Marsh Customer/supplier Increase in market sha
iation all ecommerce re
Moen Inc. Co Online customer design
nsolidated Customer online Increase in market sha
Freightways shipment tracking re

Increase in market sha

re
Innovati Charles Schw Online discount stock trad Market leadership
on ab & Co. ing Online package
Federal Expr tracking and Market leadership
ess flight management Online
full-service customer syst
ems Market leadership
Amazom.co
m
Growth Citicorp Global intranet Increase in
Wal-Mart Merchandise ordering global market
by global satellite network Market leadership
POS inventory tracking
Toys Us Inc.
Market leadership
Alliance Wal-mart Automatic inventory reple Reduced inventory cos
/Procter & nishment by supplier t/increased sales
Gamble
Cisco system Virtual manufacturing Agile market leadersh
s alliances ip
Online one-stop
Staples INC. shopping with partners
and partners Increase in market sha
re

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