Relationship Between Business Strategy and It Strategy Essay

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ITM501-Module 4 Case RELATIONSHIP BETWEEN BUSINESS STRATEGY AND IT STRATEGY. 1. If the business strategy is to reduce costs and become more competitive the business adopts an IT strategy that helps reduce costs and collaborate closely with suppliers. 2. If the business strategy is to differentiate its service by providing excellent customer service and response and IT strategy of linking ERP and customer service provides competitive advantage to the business. 3. If the business strategy is to differentiate by producing a better product, the IT policy of linking ERP, product data management and other systems helps improve the product. 4. A company can gain competitive advantage by collaborating in a meaningful manner with the customers and supplier in a supply chain. Only a well devised IT strategy can help achieve this objective. 5. One way to reduce costs and gain competitive advantage is to reduce inventory costs as well as avoid stock out situation. An IT strategy that allows a supplier to examine the business's inventory and order processing system is an efficient way of achieving this goal. PROBLEM WITH STRATEGY FORMULATION? 1. The company or its partners believe that adoption of integrated data sharing is not yet the industry norm and when it will become a norm in the industry it will be used. 2. Strategy formulation may not have any problems but to implement the strategy is very difficult because it means dealing with several partners. 3. Strategy formulation even with the partners is easy, especially in broad terms. Only when the specifications related to implementation are discussed that the collaborators withdraw; 4. Strategy formulation is usually encouraged but when it comes to the cost of changing the system, incurring cost and introducing modern IT systems in business when the resistance arises. 5. Essentially there is no

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