Kimberlie

Estrella
BUSA 345
Professor Xu
24 April 2017


Using Information Systems Strategically


For my final paper I would like to identify some requirements for developing an

information system that can be used strategically, illustrate how information systems can give

businesses a competitive advantage, and find out what area your business should choose to

compete in.

A strategy is a plan to gain an advantage over the competition, so a strategic

information system (SIS) is one that creates and takes opportunities to outperform

competitors. When you are creating an SIS you need to remember that it must be a part of the

overall organizational strategic plan. Some questions you can ask yourself while creating the SIS

are, What is the most effective way to gain an advantage?, Would more accessible

information to our employees help establish a greater advantage?, Is developing a new SIS

economically justified?, and What are the risks of developing a new system?. Once you have

answered all these questions you will hopefully have a plan to create a new SIS that will help

you gain a competitive advantage.

There are many ways that information systems can give businesses a competitive

advantage, but I will discuss three here. The first way is if you use them to achieve the lowest

operational costs and the lowest prices. If you incorporate an efficient customer response

system to directly link consumer behavior to distribution, production, and supply chains it

would help lower inventory and distribution costs. (Laudon) The second way would be to
differentiate your products and services. You can use your information system to find out more

about other products and how you could improve them whether it be through better

advertising, or just a superior product. An example of a differentiated product is the Google

search engine. It wasnt the first of its kind, but it has become the popular and superior choice.

A third way that an information system can give businesses a competitive advantage is by

creating the opportunity for companies to create alliances. An example of this would be a

website like Expedia. By going through Expedia you can book everything needed for your

vacation in one place, and at a discounted rate. The common denominator among the car

companies, hotels, and airlines on Expedia is that they all have information systems that track

transactions and discounts. This gives them an opportunity to create a bundle that entices

customers to book with them. (Souza, 46)

The best way to identify where you should compete is by analyzing competitive forces.

In our book it says that the framework most often used is Porters notion of the five primary

competitive forces.

1. The rivalry among competing sellers in your industry.

2. The threat of potential new entrants into your industry.

3. The bargaining power that customers have within your industry.

4. The bargaining power that suppliers have within your industry.

5. The potential for substitute products from other industries. (Valacich, 60)

By analyzing these statements in relation to your company or business, you can determine which

of these forces is most important, and what technology you want to use to address that force.
 We now know how to create a successful strategic information system, but you have to

remember that companies are constantly looking for innovative ways to use these systems so it

is not just something you make, and then never revise or change. Putting out new information

systems is an ongoing process in which organizations are looking for new technologies, choosing

the technologies that match with the challenges the company faces or creates economic

opportunity, and implementing it in a way that helps them to gain a competitive advantage.

Before this class and researching this topic for my paper, I didnt have any knowledge of

information systems and why they are so important to running a successful operation. I can now

say that utilizing information systems strategically will be at the forefront of my mind if I ever get

to run a business or company.

Works Cited

Laudon. Management Information Systems. Chapter-3. N.p., n.d. Web. 27 Apr. 2017.

<http://paginas.fe.up.pt/~als/mis10e/ch3/chpt3-3bullettext.htm>.

Sousa, Kenneth J., Effy Oz, and Effy Oz. Management information systems. Stamford, CT, USA:

Cengage Learning, 2015. Print.

Valecich, Joseph. Information Systems Today. N.p.: Prentice Hall, 2016. Print.