Answered Essay: How does Porter's competitive forces model help the company you work in

How does Porter’s competitive forces model help the company you work in developing competitive strategies using information systems

Expert Answer

Porter’s five forces model comprise of the strategies that are designed in respect of five competitive forces that shape the working of the firm. These comprise of factors such as the traditional competitors in the market, new entrants, substitute products in the market, suppliers, and customers of the company. The generic strategies that information technology can be used with in the Porters five forces model are by creating low cost leadership, the IT can be used to lower the operating costs of the company. For example if the company uses IT to record the customer response on the new launched products to the company, the firm would correctly evaluate the response helping the firm design product specific supply chain. IT can also be used by the company to create product differentiation. The information system can be used to customize the product and the tailor made products can be used to create product differentiation.

IT can be further used by the company to create niche marketing. The technology can be used to select the target market and work towards detailed segmentation and targeting of the consumers. The company can also use the technology in designing the tailor made products for the consumer and create a distinction from the competitors. The Information technology can be used to create to integrated supply chain network to enhance the functioning of the organization and creating competitive edge in the market.

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