Platt Perspective on Business and Technology

Leveraging information technology to revitalize mature industries and marketplaces 6: adding in a competitive context 1

Posted in business and convergent technologies, strategy and planning by Timothy Platt on February 7, 2014

This is the sixth installment in a series in which I discuss and analyze businesses as information management systems, and in which I characterize their competitive strength and marketplace capabilities in corresponding information technology implementation terms (see Ubiquitous Computing and Communications – everywhere all the time 2, postings 273 and loosely following for Parts 1-5.)

I have up to here in this series, been discussing information management systems and policies as they map and represent overall business operations, and business strategy as actually put into practice. And as such, I have been discussing businesses as information systems per se, first in an internal to the business context (in Parts 1-3), and then looking into how businesses connect into supply chains and other business-to-business collaborations (in Parts 4 and 5.) But up to here, I have taken a relatively static view of the organization. I add the element of change in here, and the emergence of innovative opportunity and need, as marketplaces and competitive contexts evolve and as individual businesses that operate in them face need to grow and evolve too.

• When you view and analyze a business in terms of its information held, and its information management systems and processes and their operational and due diligence efficiencies,
• Business innovation becomes a function of improvement or loss of relative efficiency, cost-effectiveness or risk management quality in business sustaining information systems and processes.
• Obviously, this perspective can only capture one side of a business’ overall innovative potential. A manufacturing company, for example, might find their most readily available and achievable opportunities for innovative change in their production facilities and through upgrading their equipment for parts production and final assembly of their marketable finished products. But even there, potential benefits can be lost if these new production and assembly systems require upgraded or more fundamentally changed inventory management systems too, that are fundamentally information management and distribution systems.
• So an information systems perspective can often hold significant value when considering business innovation in a general sense and even when considering areas of business process and performance that would not traditionally be viewed in terms of information management per se,
• As well as when primarily looking at innovation as it might arise strictly within an Information Technology department.

I restate this line of reasoning here with its within-organization perspective to repeat a basic principle that applies both when analyzing and evaluating a business within its own walls, and also when considering how it connects out in participating in business-to-business collaborations.

• Operational and strategic processes throughout an organization can be fundamentally viewed and understood in terms of information, and information management and flow. And this applies both within the organization and when that business is viewed in larger contexts.

And this brings me to the core issues that I would discuss in this series installment, where I widen the scope of this narrative to include understanding and responding to competitors. That is where the costs and risks of innovation are offset and exceeded by the value that it can and does bring, when effectively implemented.

• Ultimately, the one true measure of value obtainable through business innovation is in how it impacts upon and shifts marketplace and competitive strength and position.
• And from an information systems perspective this means developing and maintaining information systems that can confer competitive advantage for design, production, and/or distribution and sale of marketable products and services.

When dealing with business-to-business partners in collaborative arrangements such as supply chain systems, this means understanding other business’ systems and operationally aligning with them for smooth, reliable, cost-effective, secure business-to-business transactions, all of which depend on supporting and enabling information transactions.

When dealing with competitors, this means understanding them and their systems and processes, and with knowledge and understanding of their business-supporting information systems definitely included in that. And it means understanding their strengths, weaknesses, opportunities and threats at a business operations and strategy level as well as knowing what products and services they are currently shipping out of their doors. This business level understanding is essential if you are to be able to plan ahead and address their challenges to your business proactively, rather than just responding reactively to them, always finding yourself playing catch-up with them.

From an information systems perspective, this means looking at their products and services themselves, but it also means looking at and understanding their processes and systems for bringing those marketplace offerings together and bringing them to market and to specific customers. And beyond just that it means understanding how they complete the cycle for those process steps through customer support and current customer marketing services, where that can lead to repeat business and also encourage word of mouth and viral marketing for developing new customer business.

• Effective innovation in a business and its systems and processes begins with understanding the competition and where a potential innovative change might yield competitive advantage.
• Innovative change simply for the sake of change might work and even lead to increased business success, but innovation that is not developed strategically and from an awareness of the competition and how they are changing and evolving, is more likely to only create new cost centers without matching gain.

I have written this posting in more general terms and will continue its discussion in a next series installment where I will more directly focus in on information systems. And I note in anticipation of that, that I will discuss both single business versus single business competition scenarios and supply chain versus supply chain scenarios. Meanwhile, you can find this and related postings at Business Strategy and Operations – 3 and also at Page 1 and Page 2 of that directory. You can also find this and other related material at Ubiquitous Computing and Communications – everywhere all the time 2 and at the first page to that directory.

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