IBE312:
Ch18 – Business Strategy
2013
Business Strategy
Fig. 18-1 feedback loop of business strategy and IA (M&R)
 Competitive advantage – “Competitive advantage grows out of
value a firm is able to create for its buyers that exceeds the firm’s cost
of creating it. Value is what buyers are willing to pay, and superior
value stems from offering lower prices than competitors for equivalent
benefits or providing unique benefits that more than offset a higher
price. ” (Porter, Competitive Advantage of Nations, 1990, p.73)
 Competitive strategies - Cost leadership (operational
effectiveness), Differentiation (innovative products, better
customer service, etc)
2
Defining Business Strategy
 Michael Porter – On Competition – says do it
better than the rivals at same or lower cost. - that
is:
 ”Operational effectiveness means performing
similar activities better than rivals perform them.
Operational effectiveness includes but is not
limited to efficiency.”
3
Alignment
 Of the IA with the business strategy
 Stakeholder interviews can help reveal the
company strategy. Questions to ask:
• What is the company good at?
• ..bad at?
• What makes the company different from your
competitiors?
• How are you able to beat competitors?
• How can your web site or intranet contribute to
competititve advantage?
4
Strategic Fit
 Activity system maps – a tool for examinig strategic fit.
See strategic fit between activities.
 Can the business strategy be seen in the website design?
5
Business Strategy (cont.)
 Exposing gaps in the business strategy:
• One best way (SWOT) - but not the only way
• Many good ways (the elephant) – The “blind” are we.
The elephant is “strategy formulation” or “IA”.
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Many Good Ways
 p388
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Competitive Advantage
 Moore says ”most people focus on the top layer of
differentiated offerings (e.g. branding and positioning),
businesses can achieve lasting competitive advantage
ony by building from the bottom up. (M&R, p.390)
8
IA – invisibility to advantage
 Lower layers play a critical role in building a successful user
experience.
 Think about the company that you are consulting in Ex3. Fill
in what you know about that company using this pyramid.
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