Information Systems In Business

1.Explain information technology’s role in business and describe how you measure success?

Information Technology is everywhere in Business, understanding IT provides a great insight to anyone learning about business.
Information technology has become an important part of organisations’ strategy, competitive advantages, and profitability. There is management pressure to build systems faster, better and at minimum cost. Success is incredibly difficult to measure, but we can measure success by Efficiency IT metrics and Effectiveness of IT metrics.

Efficiency IT Metrics
Measures the performance of the IT systems itself, such as throughout, speed and availability.
Effectiveness IT Metrics
Measures the impact IT has on business process and activities, including customer satisfaction, conversion rates and sell through increase.


2.List and describe each of the forces in Porter’s Five Forces Model.
Understanding the five forces can help a company identify potential opportunities and create a competitive advantage wile determining potential rivals. The five forces are the following,
•Buyer Power
•Supplier Power
•Threats of Services
•Threats of new entrants
•Rivalry among existing competitors

Buyer Power
When a buyer have many sellers to choose from, and is low when their choices are few. It is reflected by their ability impact the price they are willing to pay for an item.

Supplier Power
Consists of all parties involved, in the procurement of a product. In a typically supply chain, an organisation will probably be both a supplier and a customer.

Threats of Services
Threats of service are high when there are many alternatives to a product or service and a low when there are few alternatives from which to choose.


Threats of new entrants
Threats of new entrants are high when it is easy for new competitors to enter a market and low when there are significant barriers to entering a market.

Rivalry among existing competitors
Rivalry among existing competitors is high when competition if force in a market and low when competition is more complacent. Although competition is always more intense on some industries than in others. The overall trend in towards increased completion in almost every industry.


3.Compare Porter’s three generic strategies.
An organisation can follow one of Porter’s three generic strategy when entering a new market.
1. Broad cost leadership
2. Broad differentiation
3. Focused strategy

Broad strategies reach a large market segment, while focused strategies target a niche market. A focused strategy concentrates on either cost leadership or differentiation. Trying to be all things to all people.


4.Describe the relationship between business processes and value chains.
Business process is a standardised set of activities that accomplish a specific task, such as processing a customer’s order. To evaluate the effectiveness process, an organisation can use Michael Porter’s value chain approach.

Value Chain is an approach view of an organisation as a series of process, each of which adds value to the product or service for each other. To create a competitive advantage, the value chain must enable the organisation to provide unique value to its customers.