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Lecture

Chapter 8.docx

5 Pages
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Department
Administrative Studies
Course Code
ADMS 4570
Professor
Lois King

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Description
Chapter 8 entry into the fast moving internet economy does not guarantee success the internet has been rapidly adopted by people worldwide the impact of information and communication technologies goes beyond the internetat a more basic level it is the shift from analogue to digital technologies that is responsible for so many new IT capabilities analogue represents a type of physical info that requires large amounts of storage and often works only with hardwired equipmentdigital technology they use information in the form of bitselectronic signals expressed as either on or off one or zero Digital technology capabilities have become a major driver in todays economy Technology driven initiativesthe internet wireless communication and other digital technologies are having a significant impact on the economythey change the ways businesses interact with each other and with consumersso business must perform at a higher levelsmarter faster cheaper This also provides them with opportunities Using the internet and digital technologies you can find new geographic areas make bids and purchase have a reservoir of knowledge that is online and you can sell stuff With the internet competitive advantage industry analysis and longterm customer relations are even more important Databases can be updated instantaneously systems are more flexible and alternative choices can be valued in real timeCo creation process becomes possiblecustomers can be involved from the beginning in developing productswhich blurs the lines between suppliers customers and the firmit is the cocreation processThis is why strategy formulation is so importantthings are changingshould use the internet as a tool to help get profitable transactions How the internet affects the 5 competitive forcesThreat of new entrants oIt reduces barriers to entry such as the need for a sales force access to channels and physical assetsAffordable advertising as well for smaller firmsoInternet applications are difficult to keep proprietary from new entrantsoA flood of new entrants has come into many industries can create an image that they are strong competitors regardless of sizecan personal and pay more attention to detailocan have more access to distribution channels as well bargaining power of buyersoeliminates powerful channels or improves bargaining powerthey have access to more options and companies must compete on price because there are more outletsoit shifts bargaining power to consumersthere is more need for customer loyaltyothere is a reduction in switching costsits easy to access it
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