The Reasons Information Technology Increases Competitive Advantage

Published Date: 02 Nov 2017

INTRODUCTION

In the sophisticated world nowadays, many organizations or company are used Information Technology (IT) tools to make them outstanding from other organization or company in global business. Moreover, every company that want to make difference or unique from other company they need to put or create some competitive advantage through information technology tools. First of all, we need to know the meaning of information technology and competitive advantage ahead so that we can go further about this discussion.

‘’Definition of Information Technology (IT) is a field concern with the use of technology in managing and processing information. Information technology (IT) is a set of tools, processing information, and methodologies such as programming, data communication, data conversion, storage and retrieval and etc.’’

‘’Definition of competitive advantage is known as an advantage gained over competitors by offering customers greater value, either through lower prices or providing additional benefits and service that justify similar, or possibly higher, prices. For growers and producers involved in niche marketing, finding and nurturing a competitive advantage can mean increased profit and a venture that is sustainable and successful over the long term’’. Thus, the definition of’’ global business is consisting of transactions that are devised and carried out across national borders to satisfy the objectives of individuals, companies, and organizations’’.

Base on the definition above, what can I conclude here relate with the question is Information Technology (IT) is drive business create some competitive advantage in their business through (IT). Therefore, (IT) can make every company more efficient and effective while do it any task or more innovative in term of create something new to make their company difference and unique from others. Thus, competitive advantage is importance to every company and organization which to leverages their innovation idea and try to find the market niche that they need to fulfill their demand. The way to make company stay in compete with other company is apply the competitive advantage through IT in global business.

OBJECTIVE

To find out what is the reasons information technology increase competitive advantage

There are there reasons which are information technology increase revenue, IT can help increase productivity and reduce operation cost and IT can help secure the privacy of your customer and employees.

To examine the used of information technology in competitive advantage.

BODY OF ARTICLE

The Reasons Information Technology Increases Competitive Advantage

First reason-information technology can help increase revenues

Competitive Advantage- (web Presence).

Every company that is emerging company into the global must have the website which means that company must create the website to deliver or share the information about your product and service through the website. If you don’t know how to create the website, you must hire or outsource a good web developer to create the best website of your company. Website is very importance to company because customer tent to search or gain information through the internet rather than printed media. So, as an extraordinary company you must put some value add to your product and service and also must create some unique or difference website to attract customers.

Competitive Advantage – (E-Commerce).

In an industry that sell or serve same product and service, you need to make differentiate from other company. That is mean, if your businesses almost same as your competitor you must use Information technology to make your company more outstanding such as create your company become click-and-mortar. In sophisticated world people more wanted to shop or buy from click-and-mortar. This is the way to make your company more differentiate and unique by using Information technology. In addition, it is will increase the competitive advantage through the Information technology.

Customer relationship Management Software –(CRM Competitive Advantage)

To ensure that the performance of sale team, your company must set the sale goals and tracking performance sale team whereby sale team must achieve it that set of goals to increase Revenue Company. Furthermore, your staff or employees must follow up in timely manner with all customer requests and give them the best service so that they will position your company name in their mind. By using Information Technology your company can track the customer complaint and suggestion, so that your company can improve performance from that. In addition, when you improve the CRM of your company that will be increase your competitive advantage thus when your company use CRM system through Information Technology will make your company one step ahead from other competitor. Information technology again will help you company tough and strengthen your competitive advantage by increase the sale close rate.

Reason 2 – Information Technology Can Help Increase Productivity And Reduce Operating Cost.

Competitive advantage- (computer networking)

In an organization MIS is very importance to make all work or task easier and efficient rather than use manually work. In this sophisticated era, organization or company must apply MIS to make all work or task effective and faster. For example, upper-line management wants to give their order or task to bottom-line management, they need to use email or memo to send all the task to their employees rather than they make meeting with a couple hours, it is take a long time and this is not efficient to your company. Thus, operation side also will effect because of an order from upper-management is late and they cannot to make decision without authorizes. If your company not uses Information technology, your company will decrease competitive advantage and it will affect your revenues. A simple network will save everyone time and directly contributes to strengthen your competitive advantage.

Competitive advantage – (automation software)

Recently, company not aware about the system that will make the work faster and effective rather than use manually work and its make couple hour to done the task. However, to make your company competitive advantage, you must apply multitasking work so that your employees can do many work in the same time. For example, if your company used automation software which means that you need to put some recent information in some software so that the information directly detect that information and automatically complete your task such as inventory tracking, sale tracking, account system and etc. This software will make your work more efficient and multitasking. Thus it will increase competitive advantage in your company by using this Information Technology and Management Information System.

Competitive Advantage – (Enterprise Resource Planning Software)

Definition of ‘’Enterprise resource planning (ERP) systems integrate internal and external management of information across an entire organization which embracing finance/accounting, manufacturing, sales and service, customer relationship management, etc. The purpose of ERP is to facilitate the flow of information between all business functions inside the boundaries of the organization and manage the connections to outside stakeholders’’. What can I explain about ERP is system that give the information and manage it base on function information given. For example, e-commerce, e-finance, e-business system and supplier relationship management (SRM) become more integrated each other by using Information technology. Through a good ERP solution, Information technology can really make a business operation more effective and efficient thus stand out and rise above its competitors. This is the factor that way to increase the competitive advantage in business.

Reason 3 – (Information Technology Can Help Secure The Privacy Of Your Customer And Employees).

Customer loyalty/employee retention.

Somehow when we are given and deliver good product and services toward customer we forget or unconscious about the security data and network security. Thus, this is not adequate to ensure that the server not been hacks or steals the data. To ensure that your customer wills loyalty with your company, you need to make sure that the security network must completely secure. So that customer will feel secure the data themselves from your company. This is very importance issue that company need to prioritize. Moreover, to increase the competitive advantage you need to concern about your network security, that the way how your company differentiate from other competitor by do it the security of customer data and gain the customer loyalty. Every employee in your company must play the role to ensure that all the customer data such as card credit, personal information, and etc. must be keep and secure by using data security software.

The Element Used For Information Technology in Competitive Advantage.

The CEO’s attitude toward information technology :

Company leadership is very importance to drive its competitive advantage by used Information technology so that every employee will follow the order toward separate the information within the company to run the business smoothly and successfully. Moreover, the communication between upper-line and bottom-line management is important part to run the business and make them more understand what the management want about the business ahead. For example the CEO want all the sale track at that moment so by using email or software the employee can send immediately to CEO without waste time and no need to go anywhere. This is more efficient work they need to do to increase the competitive advantage by using the Information Technology.

Use Information Technology to bridge the gap between business people and technical people;

Basically, business people need to understand how to use the information technology to increase the competitive advantage in business world. Thus, the technical people need to achieve the goal that the company set for certain period. So that the relationship between business people and technical people it bring the good process to solve the problem that raise in the company. Information technology designing to give a competitive advantage requires two elements which for the first is requires to understanding the business problem that possible arise in company. Second is requiring understanding the available technologies in the company that the technical people need to design the problem by using creative problem solving. Furthermore, for business people they need to study and apply the management information system (MIS) which that will be help them to detect or find out the problem and technical issues will come out in the company.

Use information technology to view business problem from another perspective :

The most important thing that the company needs to know is the customer problem which means that from customer perspective. As a an employee we need to know the customer problem to ensure that either they like or not the good and services we are serve it to them. By using the information system employee can design the information that would be enhance the customer experience using company product.

Use information technology in creative designing:

Basically, business people designing new information system with come out the new design but still ordinary, this is the biggest mistake that they make because to gain the competitive advantage we need to designing new information system with value added in every design that they make. So people will assume that your company is more innovative and have the competitive advantage among the competitors. Moreover, to solve the problem business people must create something new way to solve the problem effectively and efficiently.

DISCUSSION

First of all, the issue in body of article that I discuss above is about the reasons information technology increase competitive advantage. There are three reasons, the first reason are talk about information technology can help increase. Which is this reason containing the element that competitive advantage need; there are web presence, E-commerce and Customer relationship management software. The reasons basically discuss about company how to gain the competitive advantage through information technology.

Moreover, the second reasons that we are discuss above is information technology can help increase productivity and reduce operating cost. These reasons contain several elements which is computer networking, automation software, and enterprise resource planning software. This reason focus on increase productivity and reduce the operating cost which mean that the company need to use the information technology to increase the productivity such as less time taken for deliver the information, solve customer problem and etc. For the third reason is information technology can help secure the privacy of the customer and employees. These reason basically focus on customer loyalty which mean that once the customer information has been hack or stolen, the customer will never trust your company anymore and that will be affect to another customer also.

Second discussion that I discuss above is about element used for information technology in competitive advantage. There are four elements which is the CEO’s attitude toward information technology, use information technology to bridge the gap between business people and technical people, use information technology to view business problem from another perspective and use information technology in creative designing. However, these elements is important to enhance the company revenue through the information technology in term of internal problem company so that business people and technical people need to find the best solution to solve the problem creatively and efficiently without effect the revenue.

CONCLUSION

The conclusion that I can conclude about the discussion above is information technology is the key success to enhance the competitive advantage in your company. Why every company needs to increase the competitive advantage? This is because every company needs to differentiate the product and service if they are in the same industry. Customer and third parties is hard to find out the specialty or uniqueness of their product if they are product same product with other competitor. The simple word that I can say is uniqueness and specialty from your company will position your brand name in customer minds. This is easier for you to do the marketing because of your brand name already establish and well know. By using information technology your production is higher and the operation cost will be reduces. This is more efficient and effective toward increase revenue of your company by using information technology.

Furthermore, information technology will increase the two way communication toward upper-line and bottom-line management which is they can communicate each other through information technology medium such as video conference, Skype, email messenger, and etc. using the automation software will reduce the task and employee can do other task in one time which mean that employee can do multitasking by using automation software. For example sales tracking by accountant, they can trace the sale by using the software immediately and they can do other task also. Information technology will reduce timeliness of employee and this is call efficient work.

Nowadays, Information technology is very important that are really need to use for every businesses. There can leverage the revenue and reduce more cost in term of operation cost, supplier cost, utilities cost and etc. So your company must have the click-and-mortar even though you are already have break-and-mortar, this is because people nowadays more likely to buy what they want through online. In addition, your company will increase the revenue and the sources you will get into two ways which is from click-and-mortar and break-and-mortar. Information technology is make business more efficient and thus makes company increase their competitive advantage ahead.

REFFERENCES

Use of information technology in competitive advantage <http://www.useoftechnology.com/information-technology-competitive-advantage/> [10 April 2013]

Baltzan,2003, Business Driven Technology, McGraw-Hill International, New York.

Baltzan Paige, (2013) Business Driven Technology, 5th edition, United States: New York

Information technology increase competitive advantage - top there reasons. <http://webtechengineer.hubpages.com/hub/Information-Technology-Increases-Competitive-Advantage >[10 April 2013]