What do you mean by business strategy and its levels? Explain

A Management Information System ICT Revision Questions and Answers

Business strategy is a set of activities and decisions firms make that determine the following:
• Products and services the firm produces
• Industries in which the firm competes
• Competitors, suppliers, and customers of the firm
• Long-term goals of the firm
Strategies often result from a conscious strategic planning process in which nearly all small to large firms engage at least once a year. This process produces a document called the strategic plan, and the managers of the firm are given the task of achieving the goals of the strategic plan. But firms have to adapt these plans to changing environments. Where firms end up is not necessarily where they planned to be. Nevertheless, strategic plans are useful interim tools for defining what the firm will do until the business environment changes.
Thinking about strategy usually takes place at three different levels:
• Business. A single firm producing a set of related products and services
• Firm. A collection of businesses that make up a single, multidivisional firm
• Industry. A collection of firms that make up an industrial environment or ecosystem
Information systems and technologies play a crucial role in corporate strategy and strategic planning at each of these three different levels. Just about any substantial information system—a supply chain system, customer relationship system, or enterprise management system—can have strategic implications for a firm. What the firm wants to do in the next five years will be shaped in large part by what its information systems enable it to do. IT and the ability to use IT effectively will shape what the firm makes or provides customers, how it makes the product/service, how it competes with others in its industry, and how it cooperates with other firms and logistic partners.

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