Business Driven Technology

Business Driven Technology

Business should drive technology as the goals of IT are aligned with the plans and goals of the organization. This requires that business managers understand the impact information technology has on business operations and the application of people, technologies and procedures to solve problems. Business managers who are most familiar with the organization’s strategic plan, are also best suited to determine what competitive advantage is gained by the strategic use of information technology. Technology should not be implemented just for the sake of staying current or appearing “high tech”. The technology goals should be developed to facilitate business goals.

Strategically, organizations derive benefits from IT in varying amounts depending on the business function. The functional areas such as Customer service, Finance, Sales and Marketing, IT Operations, Operations Management, HR, and Security benefit differently. In general, IR projects can help an organization to reduce costs, improve customer satisfaction, create competitive advantage or generate growth, streamline supply chain or expand globally. When used properly, companies can use IT to retain key customers, or improve financial management plus much more.

Competitive Advantage

Identifying Competitive Advantages is a continuous necessity today due to the fact that competitors can quickly erode an advantage by duplicating it. As a result, organizations are pushed to develop a new competitive advantage. To analyze and develop competitive advantages organizations use three common tools: 1) Five Forces Model, 2) Three generic strategies, 3) value chains.

Five Forces

In each case, technology can be developed and implemented to create a competitive advantage

1) Increase switching costs to reduce the Threat of substitution, 2)B2B Market places to decrease Supplier Power, 3) Loyalty program to decrease Buyer Power, 4) Provide Lower prices in a Rivalry intense...