UNIVERSITI TEKNOLOGI MARA JOHOR

UiTM SEGAMAT

FEB-JULY SEMESTER 1/ 2020

MGT 417
INTRODUCTION TO INFORMATION SYSTEM

ASSIGNMENT QUESTION:
Chapter Review.
Chapter 2
Organizational Strategy, Competitive Advantage and Information
Systems.

PREPARED BY:

GROUP JBC 251 1A

SUBMISSION DATE 19 May 2020
NO. NAME STUDENT ID
1 DINA QISTINA BINTI 2020966393
ZULKANAIN

PREPARED FOR:

MR. MURUGA CHINNIAH

FACULTY OF BUSINESS MANAGEMENT
UiTM, SEGAMAT, JOHOR
 TABLE OF CONTENT

CONTENT PAGE
CHAPTER REVIEW 3-7
REFERENCES 8

2
 Chapter 2 Review.

Organizational strategy, Competitive Advantage and Information

Systems.

Chapter 2 is about organizational strategy, competitive advantage and

information systems. Throughout this chapter, we will learn about how efficiency and
effectiveness affect business process, types of business process to be implemented in
the organization, types of business pressures and solution to overcome the pressures
and lastly analysing competitiveness using Porter’s Competitive Forces Model.

First, this chapter focuses on efficiency and effectiveness which are importance
to create a perfect business process. Efficiency focuses on doing things well in the
process such as making sure no wastes were produced throughout the progress from
one activity to another and effectiveness focuses on doing the things that matter such as
the product produced achieved the desired requirement. An example of cross-functional
processes is airline industry. When efficiency and effectiveness execute efficiently it will
create a competitive advantage. Competitive advantage is any assets that provide an
organization with an edge against its competitors in some measure such as cost, quality
or speed. As it is an essential for any airline industry to provide electronic ticket
purchases. Malaysia Airlines is known as the national carrier of Malaysia while AirAsia is
famous with their tagline Now Everyone Can Fly which they provide domestic and
international flight with low cost. To provide competitive advantage, these sites should
be highly accurate and responsive. They need to provide the current price for the ticket,
information about the flights such as the flight number and time, give option for hand
carry and baggage. AirAsia offers website with more user-friendly looks and faster to
load flight information compared to Mas Airlines. But in term of refund policy Mas Airlines
have the advantage as they handle the issue perfectly compared to AirAsia as a lot of
their customers complained that they did not handle the problem efficiently. Providing
competitive advantage will give pressures to the business as well as affecting the
organization which is the main reason why information systems can help you overcome
the problems.

3
 Second, this chapter allows reader to determine the best strategy to be
implemented in the organization while ensuring business process excellence. There are
three types business processes which are business process improvement (BPI),
business process reengineering (BPR) and business process management (BPM). Each
organization might use different approaches that suit their goals. As for BPR, it is a
strategy that focuses on making the business processes become more productive and
profitable. It is done to allow the organization to break away from conventional
approaches which will create a widespread change. It is redesign by American
businesses to reduce costs and increase quality. This strategy makes some organization
realised that it is too difficult to be executed and giving overwhelming impact to
employees and organizational culture. They began to improve processes by organizing
work within the existing organizational structure which resulting to less radical and more
incremental approach. This is called BPI. It is focuses on reducing defects in outputs, Six
Sigma is an initiative used by organizations to achieve those goal. Six Sigma can easily
measure product defects and have been modified to focus less on defects and more on
customer value. It has five basic phases which are define, measure, analyse, improve
and control. Over time, organization can choose to adapt BPM which focuses on
designing, optimizing and streamlining processes. This method helps organization
improve profitability by decreasing costs and increasing revenues. While BPI is
supported by Six Sigma, BPM is supported by BPMs which is a set of application that
include process information which helps the organization change the business needs
and support business intelligence. Choosing the right strategy for your organization is
very important as it will helps to improve existing processes and achieve the business
goals.

Third, this chapter introduced the readers about business pressures,

organizational responses and information technology support. A business environment
consists the combination of social, legal, economic, physical and political factors. If there
are any significant changes happen between these factors it will create a business
pressure. There are three major types of business pressures. The first one is market
pressures which are generated by global economy, strong competition, changing of
workforce and powerful customers. Globalization is the integration and interdependence
of economic, social, cultural and ecological facet of life which is important to increase
competition. But local market is different between each country as developed countries

4
have higher labour costs compared to developing countries. In developed countries the
changing of workforce is diversified. It can be easily replaced as nowadays IT’s has
enabling people to work from home. This is such a great alternative as we currently can
relate to due to the contagion of pandemic virus, the Government has enforced a
lockdown and organization need to find another alternative to keep the business going
such as execute the workers to work from home. Many organizations have realised that
customer have the knowledge about the products and services that they required. This is
called powerful customers. Technology pressures is the second types of business
pressures. Improved technologies allow organization to create new products with superb
quality. For example, when Apple produces their own tablet which is iPad, the firm
produce it once a year which is a not big gap between each product. This shows that
changes in technology is forcing organization to release new version of a product
corresponding with technology upgrade. Societal pressure is the third category of
business pressures which include compliance with government regulations, protection
against terrorist attacks and ethical issues. Many organizations find that applying the
organization in compliance with the government regulations are expensive and time
consuming. When an attack happened, many organizations are under increased
pressure and some of them choose to ask military reserves for help to protect them from
terrorist attacks. While using internet, they choose to activate security systems to protect
the business. Ethic is a set of morale principles. If ethical issues handled poorly, it will
lead to conflict in the organization such as reducing job satisfaction and increase
employee turnover. When these pressures are increasing the organization should know
how to responses these issues. Organization can choose to implement one of these
options, strategic systems and customer focus. Strategic systems provide organizations
with advantages that enable them to increase their market share, to better negotiate with
suppliers and prevent competitors from entering their markets. Choosing the right
people, the right processes and right technology will give a significant improvement
towards the organization and achieve company’s goals. Making customer happy is the
main customer focus. It is an attempt by the organization to provide excellent customer
service that will attract and retain their customers. As example, Sephora offer 10% off
discount for their first-time customer to attract them become their permanent customers.

Lastly, this chapter explained on how to analyse competitiveness using Porter’s

Competitive Forces Model. Company implemented this model to increase their

5
competitive edge. There are five forces that influence organization competition. The first
one is threat of new entrants, when new competitors highly enter your market as the
entry is easy and low when there are barriers to entry. As example, serving liquor
requires license which is a barrier to certain company as it is time consuming to acquire
the license. Next, the bargaining power of suppliers is when buyers have few choices
from whom to buy which resulting to high supplier power and low when buyers have
many choices. When supplier power is high it allows the organization stronger position to
set the price and quality as buyer does not have other alternative. As example, Windows
and Apple are an operating system that runs on computers and PC. Buyer do not have
other option as these two systems are the only well-known for managing computers.
Third, the bargaining power of customers is when buyers have many choices from who
to buy would lead to high buying power and low when buyers have few choices. As
example, students have many options in buying physical textbooks for school such as
Kinokuniya and Popular, but they also have cheaper options for buying e-book with
extremely lower price. Fourth, the threat of substitute products or services. When there
are many alternatives to an organization’s products or services, then the threat
substitutes are high and when there are few, the substitutes are low. As example,
customer can purchase an online music streaming apps such as Spotify and Apple
Music instead of buying traditional CDs as online streaming apps is easily reachable
compared to CDs where buyers need to bring a CD player. Lastly, the rivalry among
existing firms in the industry. When there is intense competition among many firms, the
threat from rivalry is high and low when the competition is not as intense. As example,
Tesco and Giant both provide supermarket grocery and daily necessities, but Tesco
covers wider coverage of delivering services compared to Giant. It shows that when
Tesco using online platform it has lower threat from rivalry.

The author of Introduction to Information Systems Supporting and Transforming

Business Fifth Edition are R. Kelly Rainer JR, Brad Prince and Casey Cegielski. Rainer
is an Associate Editor of Information Resources Management Journal, Associate Editor
of Communication of the Association of Information Systems Journal and a member of
Decision Science Institute. Prince had his Bachelor of Science in Marketing at
Jacksonville State University in 2000 and pursuing Master in Business Administration in
2002 and PhD in Management Information Systems (MIS) in 2006 at Auburn University.
He is currently an Associate Dean at Richards College of Business. Cegielski is a

6
Professor that writes more than 50 research articles and appeared in numerous
international systems journals. The author of Introduction to Information Systems is
Patricia Wallace, an author of over 40 articles, published 3 software programs and 15
books. Patricia holds a Master of Science in Computer Systems Management from
University of Maryland University College and earned her PhD in Psychology at
University of Texas at Austin.

From this chapter I managed to learn the proper ways to apply efficiency and
effectiveness in business processes, the definition of competitive advantage, the
differences between BPI, BPR and BPM, types of business pressures and lastly about
Porter’s Competitive Forces Model. For me, Introduction to Information Systems
Supporting and Transforming Business Fifth Edition book was clearly written as I can
easily find the topic easily while Introduction to Information Systems book is not clearly
written and the topic is not organized which make it hard to find a specific topic. Although
both books given examples that was outdated I personally felt that it is still relevant to
modern life. As example, Porters Competitive Forces Model is still relevant and can be
used to analyse competitiveness.

Organizational strategy, competitive advantage and information systems is

importance to expose organization ways to respond their business pressures, provides
support for their strategy and making a strategic decision. The author did an excellent
job by giving examples that easy and relatable for students to understand. Yes, I would
recommend Introduction to Information Systems Supporting and Transforming Business
Fifth Edition book to other students as the chapter and topic is very organized. The
examples were given is also can easily be understood and very appropriate for students
to learn deeper about Information Systems. But in other hands, I would not recommend
Introduction to Information Systems book because the order of chapter and topic are
messy and will give a hard time for student to read.

7
 REFERENCES

Books.
Rainer, Prince, Cageilski, Introduction to Information Systems Supporting and
Transforming Business Fifth Edition
Patricia Wallace, Introduction to Information Systems

Links.
Kelly Rainer, retrieved from https://harbert.auburn.edu>directory
Brad Prince, retrieved from
https://www.westga.edu/administration/profile.php?emp_id=47
Casey Cageilski, retrieved from https://harbert.auburn.edu>directory
Patricia Wallace, retrieved from https://www.patriciawallace.net/