Chapter 2: Using Information System For Gaining Competitive Advantage

Why learn about the Information System in the Organization? 

            From the previous class, Dr Nur explains that an Information System is very useful in an organization, which it will helps to runs all the activities in the organization, effectively and efficient. In order to be effective in an industry, each organization need to be able to counter any forces that might effect their organization or company. 

There are 5 competitive strategies that can use to confront with the forces that are:-

• cost leadership
• differentiation strategy
• innovation strategy
• growth strategy
• Alliance strategy.

               The most competitive strategy that really gets my attention is cost leadership and differentiation strategy. Each company has their own strategy in dealing with the competitive forces.  

 a) Cost Leadership.

The objective is to become the lowest-cost producer in the industry. This strategy is usually associated with large-scale businesses that offer a “standard” product with little differentiation that are perfectly acceptable to the majority of customers. 

          For example, Air Asia provides the same services like other Airlines company such MAS but they are much cheaper. They are aiming at "making flying possible for everyone". The strategy that has been used by Air Asia to attract more customers by providing product and services that is lower cost. Such as, Air Asia will also discount its product to maximize sales, they will give a discounts or free tickets for their customer and in doing so, it can further increase its market share.

 b) Differentiation Strategy

 The company will try to produce product that is different from their competitors.Besides, they aim to differentiate within a small number of target market segments. They are more into providing products that are clearly different from competitors who may be targeting a broader group of customers. 

          For example, the banking services such as Maybank, HSBC,Public Bank and others. Most of the bank has their own specialties, in terms of product and services that they offer to the customer.Every customer have their own choice to choose which bank that they prefer.  


Reference :- 

• http://tutor2u.net/business/strategy/competitive_advantage.htm 

• https://teach.lanecc.edu/rossj/LCCWebs/JerryClassPages/Jerry/CS160New/CourseTechnology/0-619-21561-5_02_op.pdf
• http://www.jstor.org/stable/4165061?seq=2

(351 words)