Information Systems

1. Explain information technology's role in business and describe how u measure success?

The positive impact of information technology on a business is that it reduces costs, improves productivity and generates growth. IT is very critical within organisations as various initiatives aid in facilitating communication and increasing business intelligence.

Success is measured through both efficiency IT metrics and effective IT metrics. Efficiency IT Metrics measures the performance of the IT system itself including throughput, speed and availability. Getting the most from each resource. Effectiveness IT Metrics measures the impact IT has on the business processes and activities including customer satisfaction, conversion rates, sell-through increases. Setting the right goals and seeing they are accomplished.

2. List and describe each of the forces in Porter's Five Forces Model?

Ø Buyer power- high when buyers have many choices of whom to buy from and low when their choices are few. One way to reduce buyer power is through loyalty programs, which rewards customers based on the amount of business they do with a particular organisation.

Ø Supplier power- high when one supplier has a concentrated power over an industry. Buyers have few choices of whom to buy from and low when their choices are many.

Ø Threat of substitutes- high when there are many alternatives to a product or service and low when there are few alternatives.

Ø Threat of new entrants- high when it is easy for new competitors to enter a market and low when there are significant entry barriers.

Ø Rivalry among existing competitors- high when competition in fierce in a market and low when competition is more complacent. Reducing switching costs is one way to "steal" your competitors' customers.

Follow links for further explanation, each link is on one area of Porters Five Firces Model:
http://www.youtube.com/watch?v=57TzFsHqPLo
http://www.youtube.com/watch?v=NxygE8Wvvjk
http://www.youtube.com/watch?v=Cp4z3LWGHpk&feature=related
http://www.youtube.com/watch?v=XpdXHTN8fmQ&feature=related
http://www.youtube.com/watch?v=MFdPhQhGFms&feature=related

(Follow links in orders presented)

3. Describe the relationship between business processes and value chains?

Information technology needs to ensure that support works well so primary activities are running well within the organisation.

http://www.youtube.com/watch?v=7wL6x1BSlw8&NR=1&feature=fvwp 

4. Compare Porter's three generic strategies?

Industry force	Cost leadership	Differentiation	Focused
Entry barriers	Ability to cut price in relation deters potential entrants.	Customer loyalty can discourage potential entrants.	Focusing develops core competencies that can act as an entry barrier.
Buyer power	Ability to offer lower price to powerful buyers.	Large buyers have less power to negotiate because of few close alternatives.	Large buyers have less power to negotiate because of few alternatives.
Supplier power	Better insulated from powerful suppliers.	Better able to pass on supplier price increases to customers.	Suppliers have power because of low volumes, but a differentiation-focused firm is better able to pass on supplier price increases.
Threat of substitutes	Can use low price to defend against substitutes.	Customers become attached to differentiating attributes, reducing threat of substitutes.	Specialised products and core competency protect against substitutes.
Rivalry	Better able to compete on price.	Brand loyalty to keep customers from rivals.	Rival cannot meet differentiation-focused customer needs.