▪ Introduction;

2 ▪ Business Processes;
▪ Business Process Improvement,
▪ Business Process Reengineering, and
Unit Business Process Management;

Organizational Strategy, ▪ Business Pressures, Organizational

Responses, and Information
Competitive Advantage,
Technology Support;
and ▪ Competitive Advantage and
Information Systems Strategic Information Systems

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 This topic discovers the connection of organizational strategy,
competitive advantage, and information systems (IS), which are very
important in shaping modern business practices.
▪ Introduction:
▪ Organizational Strategy: A plan that defines a company's goals,
Organizational
objectives, and the actions needed to achieve them.
Strategy,
▪ Competitive Advantage: The edge a company has over its competitors,
Competitive
allowing it to generate greater value for customers and stakeholders.
Advantage,
▪ Information Systems (IS): A combination of technology, people, and
and
processes that organizations use to manage and analyze data, improve
Information
efficiency, and make informed decisions.
Systems
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 • Routines (standard operating procedures)
These are Precise rules, procedures, and practices developed
to cope with virtually all expected situations. Routines ensure

▪ Business consistency and efficiency in performing tasks

• Business Processes:
processes
A collection of routines that together accomplish a specific
goal. Or Routines form the foundation of business processes.

• Business firm: Collection of business processes . A business

firm integrates and coordinates various business processes to
function effectively.
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 ✓ A business process is an ongoing collection of interconnected
activities or tasks that collectively produce a product or service of
value to various stakeholders, such as the organization, its
business partners, and its customers.
▪ Business
processes

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▪ Business
processes

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▪ Business
processes

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 ✓ These are the materials,
services, and information that
Inputs
flow through the process.
▪ Three ✓ Inputs are transformed through
activities to produce valuable
fundamental
outputs.
Business
elements of Outputs processes
Business Elements Resources ✓ Refers to the people and
equipment involved in
processes ✓ The product performing process
or a service activities.
created by the ✓ Resources ensure the
process
process operates efficiently
and effectively
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 There are three main types of
different business processes.
▪ Types of
• Core or Primary Business
Business Process
processes • Management Business
Process
• Support Business Process

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 • Core or Primary Business Process
✓ These are the main activities that enable businesses to deliver
products, services and value to their clients. Primary processes serve
▪ Types of
the customer's needs and directly impact income, profit and value
Business delivery.
processes ✓ Examples of core business processes are:
• Production • Fulfillment
• Sales • Customer service
• Marketing • Operations
• Distribution • Product development
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 • Management Business Process
✓ The processes that plan, organize, coordinate and control all the functions of
the business fall under management processes.
▪ Types of ✓ These processes are goal-oriented. It includes helping and motivating entire
team to achieve their targets. These processes also help in forming a
Business
direction for the further growth of their business.
processes ✓ CEOs, managers, and top-level management are generally involved in
management processes.
✓ Examples of management business processes are
• Strategic planning and management • Performance management.
• Budgeting and financial planning
• Corporate leadership
• Risk management
• Quality assurance LBG
 • Supporting Business Process
✓ These are the processes that are not directly related to the delivery of the
service or product to the customer. But they help the business create an
▪ Types of environment where the primary processes can work better.

Business ✓ They create a suitable environment for the primary processes to be

executed successfully. They serve internal stakeholders, keep the
processes
business running and ensure things get done.
✓ Common examples of support processes include procurement, IT,
technical support, human resources(recruitment, training), accounting
and finance processes.

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 ❑Risk reduction:
✓ Identifies potential risks in processes
and diminishes them.
▪ Benefits ✓ Planning out everything beforehand
lets you identify the most obvious
Business
risks. Thereby decreasing the time
processes spent on rectifying errors. Test run of
the process even reveals risks that are
very hard to find.

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 ❑Cost reduction:
✓ Identifies and removes inefficiencies to
reduce waste.
▪ Benefits ✓ Minimizes expenses associated with
errors and rework.
Business
✓ You run tests on every process you
processes ever create. Evaluation points out how
you can optimize your business. It
identifies unnecessary tasks. It also
helps you find alternate ways of doing
the tasks involved.
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 ❑Agility:

✓ Enables quick adaptation to

▪ Benefits
market or regulatory changes.
Business ✓ Provides the flexibility to
processes scale operations when needed.

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 ❑ Facilitates communication:

✓ Improving communication within the

company improves working
▪ Benefits efficiency. Not only that, but it also
Business improves the communication
between you and the customer.
processes
✓ Encourages transparency among
teams.
✓ Clarifies roles and responsibilities,
reducing confusion.

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 ❑ Allows for new technology:

✓ The business process should

change periodically. Thus allowing
▪ Benefits
for new technology to enrich your
Business business. Adapting to the changing

processes times is one of the best things a

business can do to keep itself
active.

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 • Clearly establish the
purpose and goals of the
process.

• Develop various methods

to achieve the objective
▪ Steps of and evaluate their
feasibility.
Business • Identify key individuals or
teams and assign roles and
responsibilities
processes • Pilot the process on a
smaller scale to ensure it
functions as intended.
• Fully implement the
process in the
organization.
• Evaluate the outcomes to
determine if the process meets
the objectives and identify
areas for improvement. LBG
 ✓It’s an approach focused on identifying inefficiencies or problems
in existing workflows/System and then resolving them to improve
overall performance. This typically involves:
❑ Business • Streamlining operations,
Processes • Reducing waste or redundancy,
Improvement • Enhancing quality, and
(BPI) • Ensuring better alignment with organizational goals.

✓ Business Process Improvement (BPI) is a continuous

approach that focuses on enhancing the efficiency and
effectiveness of workflows.
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 ✓The final goal is to create smarter, faster, and more reliable
processes that deliver better results for both the business and
its customers.
❑ Business
Processes
Improvement
(BPI)

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 The primary objective of BPI is to continuously improve the performance of both
the formal and informal processes within an organization.
By engaging in business process improvement, organizations can identify
bottlenecks, friction, inefficiencies and other problems within their processes and
❑ Purpose of take corrective actions, which helps them to do the following:
Business ✓cut costs;
✓eliminate redundant efforts;
Processes
✓ensure continued adherence to workflows and better compliance with rules and
Improvement
regulations;
(BPI) ✓improve quality of their products or services;
✓reduce errors; and
✓speed output.

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 ✓ Additionally, BPI techniques can help an enterprise meet

❑ Purpose of customer demands and business goals more effectively.

Business ✓ Business process improvement also creates value in its

Processes ability to help enterprises fine-tune how they operate to

Improvement ensure they are positioned to compete in today's technology-

(BPI) driven business environment.

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 ✓ In today’s dynamic business environment, adaptation is key to
survival. Here’s why BPI is crucial for success:
• Increased Efficiency:

❑ Business ➢ BPI pinpoints areas where processes can be optimized, saving time,
Processes resources, and reducing costs.

Improvement ➢ Enhances productivity, enabling teams to focus on value-adding

activities.
(BPI)
• Improved Quality:
importance
➢ By refining processes, BPI helps ensure consistent, high-quality products
or services, increasing customer satisfaction.
➢ Products and services meet higher standards due to improved processes.
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 • Enhanced Agility:

➢ BPI allows your business to quickly adapt to changing market

demands or customer needs.
❑ Business ➢ Encourages the adoption of new technologies and methods to stay
Processes ahead of competitors.
Improvement • Strengthens Competitive Advantage:

(BPI) ➢ A streamlined, efficient organization gains an edge over slower-

moving competitors.
importance
➢ Keeps businesses lean and efficient, enabling them to outperform
opponents.

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 • Employee Development:

➢ BPI often involves process analysis and redesign, promoting skill

development and greater employee engagement.
❑ Business
Processes
Improvement
(BPI)
importance

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 Achieving successful Business Process Improvement requires a structured
approach and a clear roadmap. The following steps outline the process:

❑ Steps for
Implementing a
business process
improvement
strategy

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 The first step in BPI is identifying and
documenting the organization's current processes.
This involves mapping out each process's steps,
❑ Steps for
inputs, outputs, and dependencies, allowing for a
Implementing a comprehensive understanding of the existing
business process workflow.
improvement Once the current processes are mapped, it is crucial

strategy to analyze them thoroughly. This involves

identifying bottlenecks, inefficiencies, and areas
with high error rates or delays. By conducting root
cause analysis, organizations can pinpoint the
underlying issues that hinder process performance.
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 Based on the analysis, organizations need to
develop a well-defined plan for process
improvement. This includes setting specific goals,
❑ Steps for establishing key performance indicators (KPIs),
Implementing a and outlining the strategies and tactics required to

business process achieve the desired improvements.

improvement With a well-crafted improvement plan,

strategy organizations can implement the necessary

changes. This may involve redesigning
workflows, reallocating resources, leveraging
technology, or introducing new tools and
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 After implementing the changes, monitoring
❑ Steps for
and evaluating the results is essential. This
Implementing a involves measuring performance against
business process defined KPIs, gathering stakeholder feedback,
improvement and making necessary adjustments to ensure
strategy sustained improvements.

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❑ Benefits of
Implementing a
business process
improvement
strategy

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 Implementing Business Process Improvement initiatives offers numerous
benefits to organizations:

❑ Benefits of ✓ Business Process Improvement aims to enhance quality

standards and customer satisfaction by identifying and
Implementing a
addressing inefficiencies and bottlenecks. Improved
business process
processes result in better products and services,
improvement increasing customer loyalty and satisfaction.
strategy ✓ BPI encourages better communication, collaboration, and
coordination among departments. By mapping and
analyzing processes, organizations can identify areas for
improvement in cross-functional workflows, leading to
improved teamwork and smoother operations. LBG
 ✓ Process optimization often reduces costs by
eliminating wasteful activities, reducing rework, and
❑ Benefits of streamlining resource utilization. Organizations can

Implementing a allocate resources more effectively, minimizing costs

and improving profitability.
business process
✓ One of the primary benefits of BPI is the increased
improvement
visibility it provides in organizational processes.
strategy
Organizations comprehensively understand how different
activities and tasks are interconnected through process
mapping and analysis. This visibility enables
organizations to identify potential risk points, bottlenecks,
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and process dependencies.
 ✓ BPI fosters a culture of continuous improvement and
adaptability, which is vital for effective risk

❑ Benefits of management. By embedding risk management practices

into the BPI framework, organizations can proactively
Implementing a
identify emerging risks, changing market conditions,
business process
and evolving regulatory requirements.
improvement
✓ During the BPI journey, organizations conduct
strategy thorough analyses of their existing processes. This
includes identifying process inefficiencies, gaps, and
vulnerabilities. As a result, organizations gain a deeper
understanding of the risks associated with these
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processes.
 ✓ Business processes often involve multiple
❑ Benefits of
control points and compliance
Implementing a
requirements. Organizations can
business process
streamline and strengthen these controls
improvement
through BPI, ensuring adherence to
strategy
regulatory standards, industry best
practices, and internal policies.

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 ✓ Business Process Improvement (BPI) methodologies are
❑ Business structured approaches used to analyze, redesign, and
process enhance business processes to achieve greater efficiency,
improvement effectiveness, and adaptability.
Methodologies ✓ Managers engaged in business process improvement
typically use one or more of the following methodologies
to work through the task:

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 ✓Lean Manufacturing
• Lean is a systematic method to
restructuring business processes
❑ Business
by eliminating waste, improving
process
efficiency, and delivering more
improvement
value to customers with fewer
Methodologies resources.
• Lean in Practice:

Lean can be applied to various industries:

✓ Manufacturing(improving production lines)
✓ Healthcare(Reducing patient wait times)
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 Lean encompasses the following:
✓ Kaizen, an approach that calls for small, ongoing changes that build up
to significant improvements;
❑ Business ✓ 5S, a related checklist-based approach built on Japanese words

process typically translated as

• Sort: Remove unnecessary items.
improvement
• Set in order: Arrange tools and materials for easy access.
Methodologies • Shine: Keep the workplace clean and organized.
• Standardize : Establish consistent procedures.
• Sustain: Maintain and review standards regularly.
✓ Plan-do-check-act, a model for testing, analyzing and improving; and
✓ Total Quality Management (TQM) framework.
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 Agile management:

❑ Business ✓ Agile methodologies are a group of principles and practices

process for software development (and other industries)

improvement ✓ It focuses on Iterative and incremental improvements to

Methodologies adapt to changing business needs.

✓ Agile methodologies prioritize customer value, adaptability,
and collaboration, making them well-suited for fast-paced
and dynamic environments.

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 Six sigma:

✓ Six Sigma is a process improvement methodology that aims to

❑ Business
minimize the amount of variations within the end product
process
✓ Six Sigma is often used in manufacturing, mainly because it
improvement
helps minimize defects and inconsistencies. The goal here is to
Methodologies
optimize for consistency, which in the end leads to customer
satisfaction. Or
✓ Six Sigma is a data-driven methodology for improving business
processes by identifying and eliminating defects or
inefficiencies, aiming to achieve near-perfect quality.
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 ✓ Six Sigma uses two primary frameworks based on the nature of
the improvement effort:

❑ Business a. DMAIC framework (Define, Measure, Analyze, Improve, Control)

process
improvement
Methodologies

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 a. DMAIC (Define, Measure, Analyze, Improve, Control)
• Define: Identify the problem, set project goals, and define
customer requirements.
❑ Business
• Measure: Collect data to establish a baseline and measure the
process current process performance.
improvement • Analyze: Identify root causes of defects or inefficiencies using

Methodologies statistical tools.

• Improve: Develop and implement solutions to address the root
causes.
• Control: Establish controls to sustain improvements and ensure the
process remains efficient.
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• DMADV (Define, Measure, Analyze, Design, Verify)

• Establish project goals and customer needs.

• Define critical-to-quality metrics and collect relevant
data.
• Evaluate options to meet customer requirements.

• Create detailed designs for the process or product.

• Test the design to ensure it meets performance

expectations.
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 ✓ Business Process Reengineering (BPR) is also referred to as
business transformation, business process redesign, or
business process change management
❑ Business
✓ Business Process Re-engineering (BPR) is a management
Process
Reengineering strategy aimed at improving organizational performance by
re-designing and optimizing business processes.
✓ BPR is a systematic and radical approach to change, focused
on transforming and streamlining core business processes to
achieve dramatic improvements in quality, efficiency, and
customer satisfaction.
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 ✓ BPR involves a comprehensive analysis of existing business
processes, identifying inefficiencies, bottlenecks, and waste,
❑ Business
and then developing new and improved processes that align
Process
Reengineering with the organization’s strategic objectives.
✓ The objective is to eliminate unnecessary steps, reduce cycle
time, and improve overall efficiency, while maximizing the
value delivered to customers.

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 According to Dr. Michael Hammer.
“Business Process Re-engineering is the fundamental
❑ Business rethinking and radical design of business processes to
Process
Reengineering achieve dramatic improvements in critical, contemporary
measures of performance such as cost, quality, service and
speed.”

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 The Business Process Reengineering is the examination and redesign of business
process to achieve the dramatic improvement in its performance, productivity, and
quality.
The Business process reengineering includes of following steps:
❑ Steps involved ✓ Set clear goals 1. Define ✓ Understand what
2. Identify
in Business and a structure objectives & Customer customers expect and
for the re- framework needs prioritize their
Process engineering requirements.
Reengineering initiative.

✓ Analyze current
5. Implement 3. Study the
workflows to
the redesign existing pinpoint
Plan Process inefficiencies.
✓ Execute the changes
and monitor
performance. 4.
Formulate ✓ Develop a strategy
a redesign to optimize and
Plan innovate processes. LBG
 ✓ Increased Efficiency:
It aims to streamline processes, reduce cycle times, and
eliminate redundancies, bottlenecks, leading to improved
❑ Advantages of
operational efficiency.
Business
Process ✓ Cost Reduction: Organizations can lower operational costs
Reengineering
by optimizing processes and reducing costs.

✓ Improved Quality: Redesigned processes include built-in

quality checks, resulting in higher quality outputs and
fewer errors.
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 ✓ Enhanced Customer Satisfaction: It focuses on
improving overall customer satisfaction by aligning the
processes with customer needs. Improves product or
❑ Advantages of
service quality, delivery speed, and responsiveness.
Business
Process
✓ Employee Empowerment: Involving employees in
Reengineering
process redesign leads to a more motivated workforce.

✓Improved Financial Performance: BPR can lead to improved

financial performance through cost savings, better resource
utilization, and increased revenues.
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 ✓ Better use of Technology: Means leveraging modern tools
like AI, ERP(Enterprise Resource Planning), or
RPA(Robotic Process Automation)and systems to improve
❑ Advantages of
processes, make them faster, and more efficient.
Business
Process So , better use of technology in BPR helps businesses work
Reengineering smarter, not harder, by optimizing processes, improving

decision-making, and enhancing customer satisfaction.

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 ✓High Initial Costs: Implementing BPR can be a costly and
time-consuming process, requiring significant investment in
resources, including technology, training, and consulting fees.
❑ Challenges This can be a significant barrier for small organizations or for
in BPR businesses with limited budgets

✓Resistance to change: Implementing BPR can be a difficult and

complex process that requires significant changes to an
organization’s culture, processes, and people. Employees may
resist the changes, especially if they feel their job security is at
risk, leading to decreased morale and increased turnover. LBG
 ✓Risk of Failure: BPR involves radical changes, which carry
a high risk of failure if not executed carefully. Poor execution
can result in wasted resources and reduced employee
❑ Challenges morale.
in BPR ✓Time consuming process: BPR requires significant time to
analyze, redesign, and implement new processes.
Organizations may face disruptions during the transition
period.

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 ❑What are the 3 R’s of Business Process Re-engineering?
The three R's of Business Process Re-engineering (BPR) are:
✓ Re-engineering
✓ Re-design
❑ Self
✓ Re-build
evaluation Re-engineering: It involves identifying and analyzing current processes that
need improvement.
questions Redesign: This involves rethinking and redesigning the identified processes for
optimal efficiency.
Rebuild: It involves deploying the redesigned processes. Or This is the process
of constructing new processes from scratch. It’s about creating new systems,
structures, and methods that better support the organization's overall strategy and
objectives. LBG
 ❑How can BPR benefit small organizations?

BPR can benefit small businesses by improving operational

efficiency, reducing costs, enhancing customer service, and
❑ Self
enabling scalability. It allows them to compete more effectively in
evaluation their markets.

question For small businesses, automation (e.g., automated inventory

management, customer communications, or order processing)
not only saves time but also reduces errors, improving overall
efficiency without the need for more staff.

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 ❑What technologies are used in BPR?

Technologies such as:

• Business Process Management (BPM) software,
❑ Self • ERP systems,

evaluation • Robotic process automation (RPA),

• Data analytics tools(Power BI), and
question
• Cloud computing are commonly used to automate and optimize
processes.

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❑BPI
Vs.
BPR ❑ Lower risk, more predictable ❑ Higher risk, potentially more
outcomes disruption
❑ Bottom -up approach ❑ Top-Down approach

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 ✓ Business Process Management (BPM) is a systematic approach
to improving an organization's processes to enhance efficiency,
effectiveness, and adaptability.
❑ Business
✓ It involves using tools and techniques to analyze, design,
Process
implement, monitor, control, and optimize business
Management
processes
✓ Business Process Management, or BPM, is a set of
different tools and techniques that together help
businesses improve and optimize their processes.

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 ✓ BPM involves the analysis, design
❑ Business
implementation, optimization, and ongoing
Process
improvement of all the activities happening within an
Management organization.

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❑ Components
of Business
Process
Management

This diagram illustrates the three core pillars of Business Process

Management (BPM):
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 People
✓ Individuals or teams responsible for executing tasks and managing
❑ Components
workflows.Their roles include creating, implementing, monitoring,
of Business and improving processes.

Process Processes
Management ✓ The structured set of activities, tasks, and workflows designed to
achieve specific objectives. Processes are the backbone of BPM
and must be designed, monitored, and optimized for continuous
improvement.
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 Technology
✓ Represents the software, systems, and tools that facilitate
❑ Components
the process.
of Business
✓ Technology enhances productivity, reduces manual effort,
Process
and provides data for process analysis and improvement.
Management
The integration of people, processes and technology, is essential for
the successful implementation and management of BPM. These
elements work in harmony to achieve organizational goals, improve
efficiency, and adapt to changing needs.
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 ✓ Business process management (BPM) is important for organizations
because it provides a structured framework that ensures efficient
❑ Why is operations align with business objectives. Unmanaged processes often
create chaos, inefficiencies, and bottlenecks, which obscure the bigger
Business
picture for teams and hinder performance.
Process ✓ By applying BPM, organizations create structured, repeatable processes

Management that lead to measurable improvements, reduce complexity, automate

tasks, and enhance governance. Process owners can streamline
important ? workflows and reduce errors, while IT leaders gain the ability to
minimize system complexity and drive automation.

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 ✓ BPM allows organizations to cut costs, streamline operations, and
adapt quickly to market changes and new technologies. By
❑ Why is managing processes end-to-end, BPM enables teams to respond

Business faster to evolving business needs, improving overall agility. IT

leaders and process owners gain control, clarity, and a clear path
Process
to operational excellence, helping organizations become more
Management competitive and achieve long-term success.
important ?

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❑ Steps of
Business
Process
Management
lifecycle
The image outlines the Steps of the Business Process Management
(BPM) Lifecycle, highlighting the steps involved in improving and
managing business processes LBG
❑ Steps of In the design phase, businesses:
Business • Analyze existing processes to identify inefficiencies or
Process bottlenecks.
Management • Define goals for the new or improved process.

lifecycle • Map out workflows, roles, responsibilities, and key metrics

for success.

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❑ Steps of In the model phase:
Business • The process design is simulated or visually represented to
Process understand its workflow and identify potential risks or
Management inefficiencies. Preparing for real-world implementation

lifecycle scenarios.
• Tools like flowcharts or Business Process Model and
Notation are used.
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❑ Steps of
During the execute phase:
Business
• The process is implemented in the actual operational
Process environment.
Management • This can involve automation through BPM software or

lifecycle manual execution.

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❑ Steps of
During the execute phase:
Business
• The process is implemented in the actual operational
Process environment.
Management • This can involve automation through BPM software or

lifecycle manual execution.

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❑ Steps of
In the monitor phase:
Business
• The performance of the process is continuously tracked to
Process ensure it meets predefined goals.
Management • KPIs (Key Performance Indicators) and other metrics are used

lifecycle to measure efficiency and effectiveness.

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❑ Steps of
The final step optimize focuses on:
Business
• Improving the process further based on the insights gathered
Process during monitoring.
Management • Removing inefficiencies, automating tasks, or revising

lifecycle workflows.
• Revising the process to adapt to changing business needs.

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 ✓ Business pressure, the impact of significant changes that
❑ Business occur in a business environment.
Pressures: ✓ The business environment is the combination of social, legal,
economic, physical, and political factors that affect business
activities. Significant changes in any of these factor are likely to
create business pressure on the organization.

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Fig: Business pressures,
organizational
performance and
responses, and IT
support.

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❑ Types of
Business
Pressures: Social
Changing nature of Different
manpower, powerful innovations in responsibility,

customers Technology governments

customers regulations

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❑ Types of ❑Market Pressures
Business • Market pressures arise from external market dynamics
Pressures: that require businesses to adapt to remain competitive.
• Examples: Increased Competition, Changing Customer
Demands, Globalization, Market Trends:

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❑ Types of ❑ Technology Pressures
Business • Technology pressures stem from the rapid pace of
Pressures: technological advancement and its impact on business
operations and strategies
• Examples: Digital transformation(like AI , Cloud
computing, IoT)

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❑ Types of ❑ Societal Pressures
Business • Societal pressures are driven by evolving social norms,
Pressures: values, and expectations.
• Examples: Cultural Shifts, Workforce Changes, Ethical
issues

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 ▪ Organizational responses refer to the strategies and actions
that businesses implement to adapt to various pressures
❑ Organizational and challenges in their environment.
Responses
▪ These pressures can include economic, technological,
social, or competitive factors. Effective organizational
responses help companies remain competitive, innovative,
and customer-focused.

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 • These are systems designed to provide a competitive advantage to organizations by
Strategic aligning business strategies with IT capabilities. Examples : Supply chain
Systems management systems to streamline operations, Customer relationship management
(CRM) systems to enhance customer interactions.

Customer • is the difference between attracting and keeping customers by

❑ Organizational Focus providing superb customer service to losing them to competitors

Responses
• is a strategy of producing customized products and
Make-to-Order services.

• is producing a large quantity of items, but customizing them

Mass
Customization to fit the desire of each customer.

E-business and • Buying and selling products and services electronically. (E-
E-commerce business is a broader concept than e-commerce.)
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❑ Framework of
Organizational
Responses

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 ✓ Competitive Advantage refers to the unique attributes or capabilities
that allow an organization to outperform its competitors. It's the edge a

❑ Competitive business gains over others in delivering value to its customers.

Advantage ✓ An advantage over competitors in some measure such as cost,

quality, or speed, leads to control of a market and to larger- than
average profits.

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 • A Strategic Information System is an IT system that helps an
organization achieve its business strategies and competitive
advantage. Unlike regular information systems, SIS are
❑ Strategic
specifically designed to support or shape the business strategy.
Information
• Provide a competitive advantage by helping an organization to
Systems (SIS)
implement its strategic goals and to increase its performance and
productivity.

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 • Porter's Five Forces model, developed
by Michael E. Porter, is a framework
for analyzing the competitive forces
that shape every industry and determine
❑Porter’s
its profitability. It helps businesses
competitive understand their industry structure and
develop strategies to gain a competitive
force
edge. The model identifies five forces
model that affect competition.
• Porter’s model also demonstrates
how IT can make a company more
competitive.

Fig : Porter's Five Forces Model, showing the five competitive forces that influence
an industry's structure and profitability. LBG
 • Threat of New Entrants

✓ Threat of entry of new

❑Porter’s competitors is high when it is

easy to enter a market and low
competitive
when significant barriers to entry
force
exist.
model ✓ New competitors entering the
market increase competition and
can reduce profits unless there are
high barriers to entry.

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 • Bargaining Power of Suppliers

✓ The bargaining power of suppliers

❑Porter’s is high when buyers have few choices
competitive and low when buyers have many
force choices.
model ✓ Suppliers' control over pricing and
supply availability, impacting costs
and profitability.

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 • Bargaining Power of Buyers

✓ The bargaining power of buyers is high

❑Porter’s when buyers have many choices and low
competitive when buyers have few choices.

force ✓ Customers' influence on pricing and quality,

which can pressure businesses to improve
model
value or reduce prices.

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 • Threat of Substitutes

✓ The threat of substitute products or

❑Porter’s
services is high when there are many
competitive substitutes for an organization's products
force or services and low where there are few
model substitutes.
✓ The risk posed by alternative products or
services that fulfill the same need,
affecting demand for your offerings

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 • Threat of Substitutes

✓ The rivalry among firms in an industry is

❑Porter’s
high when there is fierce competition and
competitive low when there is not.
force ✓ The intensity of competition within the
model industry, often driven by the number of
competitors and market growth rate.

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 Porter’s Generic Strategies, a framework by Michael Porter to achieve
competitive advantage in business. The strategies are categorized based on
two dimensions:

1. Source of Competitive
❑Porter’s
Advantage:
Generic • Costs: Competing by being the
lowest-cost provider.
Strategies • Differentiation: Competing by
offering unique products or
services.
2. Scope of Market:
• Broad Market: Targeting a wide audience or market.
• Narrow Market: Focusing on a specific niche or
segment. LBG
 The Four Generic Strategies:
▪ Cost Leadership:
(I can sell at lower costs) Produce products and/or services at the lowest cost
❑Porter’s in the industry. Aims to achieve the lowest production and operational costs

Generic in a broad market.

▪ Differentiation
Strategies
(I am better because I am different) Offer different products, services or
product features. Focuses on providing unique and high-quality products or
services across a broad market.

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 The Four Generic Strategies:

▪ Cost Focus

Concentrates on minimizing costs for a narrow market

❑Porter’s
Generic ▪ Differentiation Focus

Strategies
Offers unique products or services to a narrow market

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 ✓ Cost leadership, Differentiation, Innovation, Operational
effectiveness, Customer-orientation
❑ Strategies for ▪ Cost Leadership:(I can sell at lower costs) Produce products and/or
Competitive services at the lowest cost in the industry.
Advantage ▪ Differentiation:(better because different) Offer different products,
services or product features.
▪ Innovation:(im new...try to catch up) Introduce new products and
services, add new features to existing products and services or develop
new ways to produce them.

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 ▪ Operational Effectiveness: (more efficient) Improve the manner
in which internal business processes are executed so that a firm
❑ Strategies for performs similar activities better than its rivals.
Competitive
▪ Customer-orientation:(treat customer better) Concentrate on
Advantage
making customers happy.

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❑ Strategies for
Competitive
Advantage

Fig: Strategies for Competitive Advantage LBG

 ✓ What is Business process? Explain the different types of business
process.
✓ What is Business process re-engineering? Explain the steps of
Business process re-engineering.
2 ✓ What is Business process improvement? Explain the steps for

Self evaluation Implementing a business process improvement strategy.

questions ✓ What is business process management? Explain the steps of
the Business Process Management (BPM) Lifecycle.
✓ Define a cross-functional business process and provide several
examples of such processes.
✓ Differentiate between business process reengineering and
business process improvement, LBG
 ✓ What are the main elements of business processes, and why are
they important for organizational success?
✓ What are the main components of a business process? Explain
✓ What methodologies are commonly used in Business Process
2 Improvement? Discuss.

Self evaluation ✓ How can BPM tools and software enhance organizational agility?
questions ✓ What are some common business pressures faced by
organizations? Explain

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