REVIEW CHAPTER 2

This chapter is basically about how a business can use IT to confront the competitive forces it faces by indentifying basic competitive strategies.

Firstly, in order to stay competitive in the marketplace, organization or business have to develop some strategies to counter these forces which is, rivalry of competitors within its industry, new entrants into an industry and its markets, substitute products that may capture market share, bargaining powers of costumers and bargaining power of suppliers. For example, Baskin Robbins that sells an ice cream as their primary product besides selling cakes. Then, new entrants such as Tutti Frutti that sells the same product which is an ice cream that basically made from a yogurt.

So, when the company or a business’s realizing that they are not only a company that sells the same thing, both of the company sells same product (ice-cream), they must think about the strategies that they have to do in order to stay competitive. There have 5 strategies such as cost leadership, differentiation strategy, innovation strategy, growth strategy and alliance strategy. For me, all these strategies have their own strength in helping all these organization. The organization have to think that which the strategies that suits them. By using technologies such as IT can change the way business competes. All these can help organization gain a competitive advantage, reduce competitive disadvantage and meet other strategic enterprise objectives. All these can gain competitive advantage differentiation from products, services, and capabilities. For example, McDonalds, Pizza Hut have website that have offers online ordering, same also as Air Asia that offers online ticketing plus hotel services.