Term Paper: IT Strategies to Maximize the Competitive Advantage

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¶ … IT Strategies to Maximize the Competitive Advantage of Organizations

This paper will examine how IT strategies, also referred to e-business or e-commerce strategies, are utilized by an organization to maximize the competitive advantage of the organization within the market place. This will include analyzing IT strategy in terms of global strategy and this will touch upon how an organization handles marketing. Basically strategy requires leadership and it is interesting how it interacts with all aspects of the organization in order to succeed. Specifically this paper will use four models: SWOT, Porters Five Forces, 7s model and Value Chain to analyze IT strategy within the Chinese nutrition market. This includes health food and vitamins. Specifically these four models will analyze the IT Strategy (or lack there of) being used at a Chinese vitamin company called Waseta International Trading Company. As a result of the findings, this paper will also explore implications of IT strategy and provide recommendations for implementation of one.

Abstract i

Acknowledgements ii

Declaration iii

Table of Contents iv

List of Figures vi

List of Tables vii

Chapter 1

Introduction

1.1 Background

1.2.Statement of the Problem

1.2.1.Purpose of the Study

Chapter 2

Review of Related Literature

2.1 Introduction

2.1.1. Definition of Strategy

2.2. China and IT Strategy

2.2.1. China's Health Food Industry 10

2.3. Executive Summary: Waseta 11

2.4. Four Models 12

2.4.1. SWOT Analysis

2.4.2. Porter's Five Forces 13

2.4.3. 7s Model 14

2.4.4. Value Chain 15

2.5. IT Strategy and the Organization 16

Chapter 3

Methodology

3.1.Introduction

3.2 Procedure

3.2.Plan for Data

Chapter 4

Analysis, Discussions and Conclusion

4.1 Introduction

4.2.Strategic Analysis of Waseta 20

4.2.1. SWOT 21

4.2.2. Porter's Five Forces 22

4.2.3. 7s Model 26

4.2.4. Value Chain 27

4.3.Shortcomings of the Research

4.4. Implications of IT Strategy

4.4.1. Risk Prevention 31

4.4.2. Brand Identity 31

4.4.3. From the Technical View 32

4.4.3.1. E-Supply Chain Management 33

4.4.3.2. Procurement 34

4.4.3.3. Enterprise Resource Planning 35

4.4.4. From the Managerial View 36

4.4.5. Internet Infrastructure 37

4.4.6. Online Security 39

4.4.7. Implementation of IT Strategy

4.5. Reasons for IT Strategy

4.5.1. Implementation Schedule 41

4.6 Recommendations

4.7 Conclusion

References

Appendices 1-7 49

List of Figures

Figure 1. European Online Shoppers 49

Figure 2. SWOT Analysis

Figure 3. Porter's Five Forces Illustration 51

Figure 4. 7s Model 52

Table 1. 7s Model Table 53

Table 2. Implementation of E-Business Strategy Budget Costs (Estimated) for 2005

Use of IT Strategies to Maximize the Competitive Advantage of Organizations

Chapter 1: Introduction

1.1. Background

Today's market place continues to shrink due to computer technologies and communication being at the speed of light. This makes the act of doing business on a large scale not only possible but expected. An organization needs implementation of strategy to happen on every level within the company structure in order to function.

Many factors contribute to a company's success or failure. Company is defined by more than just its product or service and the price at which this product or service is sold in the market place. An effective organization has much strength in its favor to remain competitive. Factors such as: flexibility, creativity, openness to use of technology and innovations, communication across the organization and talented employees are a must for competitive advantage. It is an organization's ability to adjust to changing times that creates a foundation for the public to admire. How an organization continues to reflect such a persona is entirely contingent on so many factors but really it comes down to vision and action. Integrity is crucial. Upholding the company's value system and word to the public remains a key facet for success. Building any strategy or campaign on this premise presents the best possible and true corporate image to the public and allows for a great amount of trust to form. Building character and trust is very important within the financial world but also the retail forum of health products because there has been a backlash due to corporate lack of governance and scandal but also telecommunications is much like a double-edged sword. With the wrong image, comes poor press and lack of a first impression. It can make or break the situation. In this respect, strategy and strategic marketing can be a complex game. In order to better understand customers, it is important one understands how marketing works. This means not only having knowledge of traditional methods but also knowing the fundamentals of e-marketing and e-commerce.

Today's Internet is a triumph for human ingenuity and spontaneous order. In some parts it embodies leading edge technology like Asynchronous Transfer Mode but really it is the use of new technologies combined with older ones that makes the Internet so fascinating and vital to business. Specifically the Internet ends distance limitations and it empowers individuals in important new ways to create new enterprise (Gasman 2005, p. 2). The Internet is relatively vast in its freedom. Unlike the traditional telephone, the Internet is not charged by the mile or any distance. This brings people together. Retailers see the Internet as a marketing tool they can use to target a smaller, regional niche market.

One must understand it is in the best interests of companies to make the e-retailing transitions because of the fact that most shopping now happens online. This is due to the increase in e-commerce and instant need for convenience. E-commerce makes purchasing easier and faster. It fits into the lifestyle of today's 24/7 world where people do not have the time to shop at the mall or pay bills by writing out checks.

1.2.1.Statement of the Problem

The subject of IT strategy or e-business strategy in China's nutrition industry, its frameworks, convenience and also problems or implications were assessed in this research to correlate with actual phone interviews and surveys found in the literature used as methodology.

As a result of this study, this research presented preliminary findings related to IT strategy in China. This leads us to looking at how e-strategy and use of the Internet to facilitate e-commerce has created a whole industry of service for the consumer or in other words, e-services. This required a look at different models to assess strategy and analysis a company's role in the market. The models chosen are: SWOT, Porter's Five Forces, 7s model and Value Chain. The study examined the use of IT strategy at Waseta International Trading Company as a tool of optimization.

1.2.1. Purpose of the Study

The overall purpose of this paper and study is to investigate the role of IT strategy within a Chinese nutrition company. This lead to further study of its use within the health food industry in China. In addition to examining exactly what strategy is and what it entails, this study also required an in-depth study of marketing, its techniques and different applications depending on the climate in which the marketing takes places. This allows us to better understand the nature of the market place and therefore, allowed us to understand strategy better. As growing importance in an organization's competitive advantage and globalization makes an Internet presence an expectation, the right marketing strategy becomes all the more important in a company overall strategy but it also equals power.

An organization needs careful research prior to investment but also needs to strategize and ponder if the consumer is worth the profit. This paper will look at how a proactive strategic analysis allows an organization knowledge of the market in order to build a lasting presence and customer relationships. This paper will also explore the implications of IT strategy and how different degrees of brand presence within the market can create different concerns regarding risk and too much exposure. This would include any threat to protection of intellectual property as well as the organization's image and customer relations.

This paper asks one to consider the scenario of the Waseta International Trading Company in regards to IT strategy. Does the company have one in place and if so how effective is it? If the company does have an effective IT strategy, what can be done to make improvements? This can be an especially daunting task as many elements warrant analysis in order to construct a feasible plan. Still the benefits of such an investment are endless. The possibilities for growth and optimal performance by creating a seamless system make work easier, faster and more competitive for even a small company.

Chapter 2: Review of Related Literature

2.1. Introduction

Information Technology is a powerful means that helps organizations meet the challenges of a competitive market environment and enable the firms to stay ahead of the competition. The information revolution is exerting substantial effects on the structure and functions of organizations. From the beginning of the computing era various studies have been made that predicted several positive effects ensuing from the implementation of Information Technology (IT) (Cash & Konsynski, 1986). Many cases have been published, as well as articles in the professional press, which predicted a net increase in business results of companies that invested… [END OF PREVIEW]

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