Porter and Milar. How Information Gives You Competitive Advantages

Porter and Milar. How Information Gives You Competitive Advantages

Porter y Millar “How information gives you competitive advantage”
The Information revolution is affecting COMPETITION in 3 vital ways:
* It changes INDUSTRY STRUCTURE (this alters the rules of competition)
* It creates COMPETITIVE ADVANTAGE by giving companies new ways to outperform their rivals
* It creates WHOLE NEW BUSINESSES, often from within a company’s existing operations.

A company’s value activity falls into nine generic categories.

PRIMARY ACTIVITIES: those involved in the physical creation of the product, its marketing and delivery to buyers, and its support and servicing after sale.
SUPPORT ACTIVITIES: provide the inputs and infrastructure that allow the primary activities* to take place.

A company’s VALUE CHAIN is a system of interdependent activities, which are connected by LINKAGES (linkages exists when the way in which one activity is performed affects the cost or effectiveness of other activities). Linkages require activities to be coordinated.
The Value Chain of a company in a particular system is embedded in a larger stream of activities that we term the “VALUE SYSTEM” (which includes the value chain of suppliers, who provide inputs to the company value chain; and also the value chain of buyers).

Many of the company’s activities- not just its physical product or service- contribute to DIFFERENTATION.
COMPETITIVE SCOPE (scope es alcance)> has 4 key dimensions: segment scope, vertical scope (degree of vertical integration), geographic scope and industry scope. RECORDAR VIGS

IT IS TRANSFORMING THE VALUE CHAIN! IT IS ALSO AFFECTING COMPETITIVE SCOPE…this explains why IT has acquired strategic significance.
EVERY VALUE ACTIVITY> HAS BOTH A PHYSICAL (all the physical tasks required to perform the activity) AND AN INFORMATION-PROCESSING (steps required to capture, manipulate and channel the data necessary to perform the activity) COMPONENT.
Now IT is advancing...

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