How Do Companies Involved With Successful Information Systems Benefit?

995 Words Dec 19th, 2016 4 Pages
1. How do companies involved with successful Information Systems benefit? Give some specific examples demonstrating competitive advantage.
As we know that Michael Porter’s competitive five forces model describes the important factors that companies should be focusing on for while doing business. There are also industry’s environment forces that cannot be missed: new market entrants, substitute products, customers, and suppliers. (http://paginas.fe.up.pt/~als/mis10e/ch3/chpt3-3bullettext.htm) Below are four generic strategies to gain competitive advantages using information systems and each will be listed followed by an example.
Organizations can use information systems to fundamentally shift the cost of doing business (Booth, Roberts & Sikes 2011) or reduce the costs of business processes or/and to lower the costs of customers or suppliers (Xu, J., & Quaddus, M. A) via supply chain management(SCM).
Supply chain management (SCM) is the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer. Supply chain management involves coordinating and integrating these flows both within and among companies. (http://searchmanufacturingerp.techtarget.com/definition/supply-chain-management) One good example would be a material requirements planning (MRP) system. For purchasing department ordering materials and making sure there is enough inventory is key to everything and MRP is such a system which…

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