zoom out zoom in. The author of this article has studied nine companies that have R&D investments to see how those that use technology […]. In this company, managers first treated technology as a secondary concern, then as a primary one, then as secondary again. The companies on the continuum provide evidence that managers still consider pursuit of a technological advance a good criterion for allocating money. <6��:���ǵ��k';� /�e�y�>&)o���a��� ��9��3[!����8��4:���LSJ�Z�q[��|�ūBMЋ�W��V���g�>/�c����G����_�a.C��A�ǘ���F��/�]QLP� Each company is successful in its own market. Essentially, the business strategy determines these criteria with a view to maintaining a desired market position. As I noted earlier, company 7, the fast-growing chemicals company, is beginning to place more emphasis on technology in its business and as a result is moving toward the right-hand side of the continuum (see Exhibit II). But, if company 9 should decide to place more reliance on technology as a competitive weapon, in addition to examining the amount of resources directed toward technology, it would have to satisfy the three conditions I have listed and which I now discuss in greater detail. Amazon.in - Buy Banking Technology as a Competitive Weapon book online at best prices in India on Amazon.in. 0000004273 00000 n This article explains that information databases are not only to be prized and jealously guarded, but that the Information Systems Technology (IST) that allows manipulation of information can be wielded as a formidable weapon in the marketplace. Its investment in R&D has grown steadily, though a sales slump resulted in a cutback in R&D funds for two of the last three years. The scientists and engineers regularly visit colleagues in their field at other companies and universities to get current information that will help them determine their annual budgets. He instituted technical strategic reviews to parallel the business reviews that his predecessor had started. (Even though the technical chiefs recognize that their managers lack some of the skills and interest for carrying out these studies, they think it is prudent to spend time doing it rather than operate inconsistently with the rest of the company.). Competitive Strategic Window: The Competitive Strategic Window analyses the competitive landscape in terms of markets, applications, and geographies. Using a new skin should never mean having to relearn a weapon: it should fire the same way, never feel slower ( feeling faster is okay, but actually being faster is unacceptable), and it shouldn’t take up less (or more) space on your screen. It places little emphasis either on technology as a major element in doing business or on technical credentials in the selection of its top managers. It is the second largest company in the survey, with sales of more than $25 billion. The criteria managers use to select projects are the central factors in determining the extent to which they actively support the development of technological leadership. Currently, Rogue Company features 14 Rogues to choose from, each with their distinct strengths and weaknesses. Introduction. The technology asset is the second most important asset of IT use as a competitive weapon. The giant oil company wrapped to increase their investment in R&D. The decision-making systems and structure of the company reinforce the priority given to technological matters in two ways: (a) the company’s systems provide a close connection between business and technological decision making; (b) the systems and structure for decision making on technological matters are consistent with the company’s other systems. Michael Dell, founder of Dell Computer, puts it bluntly: “The Internet is like a weapon sitting on the table, ready to be picked … It could be a manufacturing organization or a person who buys the product.). (The top managers are aware of this unstable situation and are working to change it.). Skip to main content.sg. In other words, the culture of the companies at the right side of the continuum supports the priority attached to technology. Like companies 1 and 2, it supports a strong R&D effort and enjoys a good technical reputation. A former meta defining weapon, the SG553 was recently nerfed, and for good reason. 2. It plays an important role in the modern competitive environment though IT has become so important to competition making it … A long succession of top-level officers has come from technical divisions of the company. Because his connection with the business decision-making process is remote, the function he represents is considered rather unimportant. But as the company has grown, its strategy has shifted. Literature in this area abounds with a number of frameworks for identifying and categorizing opportunities. Rather, the profiles of the nine companies I studied suggest that a company’s decision to rely more heavily on technology should be coupled with a commitment to satisfy the conditions necessary to implement it. In companies 7, 8, and 9, the technical plan is presented after the business plan. (See the sidebar for capsule descriptions of the nine companies.). Technology as a Competitive Weapon Alan L. Frohman No one doubts anymore that to be more competi- thedevelopmentofanewbutylcompoundtobeused tivewithforeigncompaniesU.S.manufacturersneed in transportation. The orientation of top managers must change if the company is to continue with its new strategy most successfully. It relies on technology to form a competitive edge and enjoys a strong reputation for technological advances. On the other hand, a company that encourages its scientists and engineers to be market oriented runs the risk of focusing on only short-term priorities and yesterday’s problems. Jay W. Lorsch and Paul R. Lawrence, “Organizing for Product Innovation,” HBR January–February 1965, p. 109; and Paul R. Lawrence and Jay W. Lorsch, Organization and Environment (Boston: Harvard Business School, Division of Research, 1967). In contrast, company 7 determines its technology budgets on a customer-by-customer basis. There is evidence that companies can effectively move from one point along a continuum to another, as company 7 is doing. 0000001821 00000 n Its market is homemakers, who have little appreciation for the sophisticated technology that goes into the product that is so easy to use. Reference to this paper should be made as follows: Challis, D. and Samson, S. (1996) `Technical effort as a competitive weapon: experiences of Australian firms', Int. Many aspects of an organization—from technical talent to reward systems, from climate to equipment—affect the payoff a company will receive from its investments in technology. It is number one in sales in the industry, has an excellent technical reputation, and attracts and maintains top technical performers. Several years later the second general manager was promoted and replaced by a third general manager who had been in the planning and financial organization for the previous ten years. Buy Banking Technology as a Competitive Weapon by James Essinger at Mighty Ape NZ. Timing When the technology plan is presented can also reflect how important it is to the business plan. In company 2, the staff rarely carries out major activities. Supply Chain Management As A Competitive Weapon. The technology planning occurs in the same way: the people below the technical chiefs review their own projects and make recommendations for resource allocations consistent with their goals. 2, pp.126-143. Engineers in top management seats are in the minority and were selected because of their business experience rather than their technical backgrounds. The evolution of Information Technology (IT) practices and techniques is a factor that enabled the integration of supply chains into value systems. It dealt with topics on linking business and technical priorities, managing technological strategy, and planning technology. 3. Every two years, management reviews the budgets to ensure that dollars are well spent to maintain technological leadership. It allocates few dollars toward projects furthering technological advances, and the technological decision making is only distantly connected with decision making in other areas of the business. In the companies surveyed, managers base decisions to start projects on five criteria: (1) supporting business goals, (2) maintaining and building technological leadership, (3) solving a customer’s problem, (4) developing a window on technology, and (5) pursuing a technological advance. Another aspect of this problem is the tendency of companies with a strong technical orientation to produce what they can make technically, which is not necessarily what customers will buy. Although information technology has become an important part and a backbone of carrying out business activities, the overall importance of information technology as a strategic mechanism of achieving sustainable competitive advantage has greatly diminished. Rather than stating alternatives, costs, risks, and consistency with the business plan, the technical plan is a statement of past contributions and promises for the future. 4. Banking technology as a competitive weapon. It has relied on a technically trained field staff and its R&D organization to support its technical service and sales organization. A central R&D organization is struggling to forge a connection with the line organization. Buy Banking technology as a competitive weapon by Essinger, James (ISBN: 9781853342448) from Amazon's Book Store. Linking business to technology In organizations that are leaders in technology, the involvement of the top business and technical managers in decision making, planning systems, the timing of decisions, and structuring the company itself all strengthen the link between technology and business goals. Over the last ten years it has focused its R&D efforts on short-range goals and has not added much to its technical capability. As the product matures, these criteria are likely to change. For example, company 4 estimates that at least 50% of its R&D budget goes toward maintaining and developing technological leadership in areas that may have business payoffs. %PDF-1.2 %���� They are comfortable with and fluent in technical topics. These companies put a high priority on bringing in new technical blood regardless of the state of the business. Chief technical officer The fourth way companies have to tighten the connection between business and technology is to give the chief technical officer a major role in business and technological decision making. Hotels leave no stone unturned in today’s extremely competitive business environment, and a key weapon in their arsenal is technology. The use of information technology (IT) as a competitive weapon has become a popular clich; but there is still a marked lack of understanding of the issues that determine the influence of information technology on a particular organization and the processes that will allow a smooth coordination of technology and corporate strategy. The division’s market was more or less stable and the technology nearing full maturity. This is inconsistent with the top-down fashion in which the rest of the company operates. 3. For example, company 2, the multimillion-dollar aerospace company, has drawn all of its top management from the ranks of its scientists and engineers. 0000036031 00000 n Finally, he again split the technical service function between the manufacturing and sales organizations. While management has viewed technology as important to the company’s success, it has not emphasized new technology. In order to assess the competitive value of IT techniques and methods for SCM, we have conducted a field research in 2013, in a cross-sectional sample of firms at the region of Central Greece. Kevin Turner, who was a Wal-Mart vice president for application development, … The author of this article has studied nine companies that have R and D investments to see how those that use technology successfully as part of their competitive strategies differ from those that do not or don't do it successfully. However, with technology in a constant state of flux and constantly unlocking new opportunities to improve customer satisfaction and boost internal efficiency, hotels have their task cut out leveraging technology to remain one-up on competition. Copyright © 2020 Harvard Business School Publishing. 12, No. In fact, some companies in fields such as optics, integrated circuits, software development, and chemistry have been leaders in technology development when their competitors had invested much more in the development of new technology. I am not suggesting that the technology unit should operate in the same way as the rest of the company. Senior research management reviews the results but never formally presents them to senior business management, and the business managers do not incorporate them into their planning process. He reorganized the technical service units, which had reported to manufacturing and sales, so they would report instead to the research organization. All rights reserved. Systems and structure. Indeed, the potential use of information technology as a competitive weapon has already become a popular cliché. For example, in the companies placing great emphasis on technology, recruiters go to the top technical schools and offer top salaries to attract the best talent available. It has depended on a reliable product and a very motivated field sales organization to maintain its market position. Create lists, bibliographies and reviews: or Search WorldCat. A strong, central R&D organization dominates its technical development effort. Merely increasing the size of company 7’s R&D budget without applying different criteria for resource allocation probably would not make company 7 a technological leader. Since technology has been a crucial component of the organization’s competitive advantage, its IT governance archetype can be characterized as an IT duopoly. The chief technology officer and the president often meet in this way. In company 8, in contrast, the top business managers communicate very little with heads of the technical unit. By solving a customer’s problem, usually by providing technical service, scientists and engineers can get ideas for new or improved products or process changes, especially if the customer is technically sophisticated, like the OEM customers of computer manufacturers. Companies on the right-hand side of the continuum not only put a greater proportion of their dollars on projects to maintain and develop technological leadership than companies at the left-hand side, they also publicize their technological competence. 0000006911 00000 n Communication between functional groups deteriorates when the systems are not consistent with each other. Business and technology units differ as to the amount of uncertainty, time delay for information, and orientation of the people that is appropriate for each. Size alone cannot explain the difference in reporting relationships. Support of other systems The pay, promotion, and hiring processes are also important communicators of the priority management attaches to technology. In response, technology partnerships between and in some cases among organizations are becoming more important and prevalent. Less than one year later, the smaller company introduced the compound to the market and is still reaping substantial profits from the product. In some companies, staff managers do little more than analysis; in others, staff managers in effect make the key decisions. If it is not the amount of R&D investment alone, other factors must either inhibit or encourage the successful exploitation of technology. Banking technology as a competitive weapon 1997: Winning strategies explained The use of information technology (IT) as a competitive weapon has become a popular cliché; but there is still a marked lack of understanding of the issues that determine the influence of information technology on a particular organization and the processes that will allow a smooth coordination of technology and corporate strategy. Of nine companies studied, those that successfully exploit technology have Technology as a Competitive Weapon | The Case Centre By continuing to use our site you consent to the use of cookies as described in our privacy policy unless you have disabled them. Companies that exploit technology well do not just continually funnel more resources into that area; they sort out the tasks and set priorities using detailed criteria. Obviously, different functions operate in different ways, but it is important that they link effectively with the rest of the organization. One member of the company’s planning staff describes it this way. Rather than develop a technical staff function capable of communicating with this group or influence the business planning staff himself, the chief technical officer tried to work directly with the president of the company, but with little success. Information technology: a new competitive weapon @inproceedings{Parsons1983InformationTA, title={Information technology: a new competitive weapon}, author={J. Parsons}, year={1983} } There has been a notable absence, however, of testable models based on relevant theory. IoT initiatives are no longer driven by the sole purpose of internal operational improvement. olpaperf05g2 - USING INFORMATION TECHNOLOGY AS A COMPETITIVE WEAPON Prepared for Dr Mary Lacity IS 6800 Management of Information Systems Prepared by. The goal here is that no skin makes a weapon feel unfamiliar. Second, the decision-making systems and structure of the technology unit are compatible with those of the rest of the organization. 0000002105 00000 n Indeed, tech- up its effort with the conclusion that the compound Competitive edge. Technology as a Competitive Weapon - Free download as PDF File (.pdf), Text File (.txt) or read online for free. Identify and rank the ways in which information technology might create competitive advantage. Company 1 has a stable pattern. The business managers are even expected to handle special projects by drawing on their line people. When used intelligently, any operator from the roster can make big plays and win games. A company’s decision-making systems and structure reinforce the technology strategy in two ways. Un article de la revue Revue internationale P.M.E. In company 2, the aerospace manufacturer, the scientists and engineers in the technical organization allocate the available dollars to projects based on their determination of what will help the company stay abreast of the technology relevant to its business. With the appointment of a new president who puts greater emphasis on technology, in a few years one can expect to see more top managers who have technical backgrounds. Account & Lists Account Returns & Orders. Organizations investing in information technology (IT) over the past decades have categorically seen the uses of IT change. AbeBooks.com: Banking technology as a competitive weapon (9781853342448) by James Essinger and a great selection of similar New, Used and Collectible Books available now at great prices. Read Banking Technology as a Competitive Weapon book reviews & author details and more at Amazon.in. The company is noted more for its high-quality products than for its technological leadership. To derive the companies’ positions on the continuum (see Exhibit I), I asked knowledgeable business people, some of whom work for the companies and some who do not, to rate them according to the emphasis each places on technology and according to their effectiveness in using it as a competitive weapon in maintaining and developing their businesses. Research Reports [Widget Area] Consulting Sample Projects Training. Downloadable! This preview is indicative only. Still, the practice of moving plants overseas and deploying technology to reduce labor costs has perpetuated the myth that production -- actually making the products -- contributes little to a company's competitive position. Technology as a Competitive Weapon Keywords: Technology management; technical function management; best practice; case studies; Australian manufacturing firms. The IT duopoly arrangement allows technology executives and business unit leaders to collaborate on technology projects and decisions. But a new president, who wanted to raise that priority, appointed a chief technology officer who reported directly to him. For example, in company 2, all but the most fundamental R&D investments have to appear in the business plan of the businesses to which they are directed. Its investments in technology have remained volatile, even though its business has grown remarkably well. George Steiner, Top Management Planning (New York: Macmillan Press, 1978). Consistent with this approach, company 2’s technology managers, not staff, conduct the special studies and analyses necessary for decision making. 2. 68 0 obj << /Linearized 1 /O 71 /H [ 981 478 ] /L 250381 /E 53395 /N 10 /T 248903 >> endobj xref 68 21 0000000016 00000 n In company 5, top management reviews the business plan two months before it reviews the technical plan. Of course, the two plans should be in balance. Company 9, the large equipment manufacturer, also shows a stable profile. A product at the beginning of a life cycle is likely to require performance-improvement projects, whereas a mature product is more likely to need process-improvement and cost-reduction projects to support it. 0000000784 00000 n … While this system maximizes the exploitation of the R&D organization, it does not necessarily produce optimal overall results. To keep its leadership in this field, the company undertakes projects that provide a continuous stream of information and experience in the handling of lithium catalysts. The M4A1 assault rifle has seen a buff in terms of damage, fire rate and range, making it a more competitive weapon. This article surveys the major efforts to arrive at a relevant framework and … Company 7 is a fast-growing chemicals company with sales of $3 billion. Where such systems are not consistent, someone who acts as an integrator can be a help.5. 0000003999 00000 n HTC recently complained that Samsung has “strategically declined” to provide it with crucial parts for years. Leaders need to consider all these factors when trying to optimize a particular offset deal for a given country. People attending the meetings take few formal notes and form the final plan by briefly summarizing the presentations. Although the rifle is not the must-have weapon anymore, it is still a fantastic gun. In company 3, a manufacturer of computers and related equipment, the president reviews the technical plans and budget at regular intervals and is informed of major progress or delays with respect to key technological undertakings. In company 6, the two groups communicate somewhat, but the top business managers do not really get involved in making technical decisions. Kenneth R. Andrews, The Concept of Corporate Strategy (Homewood, Ill.: Dow-Jones-Irwin, 1971). 0000001459 00000 n However, if you’re just starting out in the game, you might be overwhelmed by the different types of characters available in the game. Search. Indeed, technology can be a powerful weapon on the battlefield of economic enterprise. Banking Technology as a Competitive Weapon close. The early building experience allowed the company to leap ahead in the field and to successfully exploit the new technology. The running-out-of-time phenomenon clearly communicates to the rest of the company, especially the technical people, that management thinks little of technology’s contribution to the business. The business manager is responsible for developing the technology effort and effectively integrating it into his plan. In company 2, management reviews the business and technology plans at the same time. In company 7, the mismatch is evident: the business planning staff is strong and makes important contributions to the business, but the technical staff is weak. In company 2, on the other hand, the chief technical officer sits in on the important business and strategy meetings. 0000006125 00000 n The business plans and strategy statements for both companies 2 and 3 include assertions regarding technological priorities and steps for carrying out those priorities. Exhibit II Where companies fall on the continuum vis-à-vis three conditions for companies that exploit technology well. Companies that rely heavily on technology as a competitive weapon either focus much of the responsibility for decision making on both technical and business managers or leave a lot to staff members on both sides. Where the business plan is presented first, management might screen out promising technical ideas that seem inconsistent with it. Cart All. 0000001940 00000 n In contrast, company 8, the large transportation equipment manufacturer, has drawn most of its top managers from the administrative side of the organization, usually from the financial divisions. However, technology isn’t the only way to get competitive advantage instead it is one of the many ways to scale your business. It continues to invest substantially in R&D. Company 4 has a strong bottom-up approach to decision making: line managers make decisions, which then bubble up to the higher levels for a final decision. That weapon is an immensely valuable yet often underappreciated asset: data capital, specifically around consumer insights and demand forecasting. Five-forces model, Competitive forces, Porter's five forces, Porter's framework for competitive analysis ... Parsons, G. 1983. It is, nonetheless, a steady innovator and a firm supporter of R&D. In several companies where top managers have strong technical backgrounds, the R&D managers complained that the managers spent too much time “engineering our projects”—that is, getting too involved in technical operations. On the other hand, company 7 estimates that 70% of its R&D dollars is invested in projects aimed at solving immediate customer needs. Merry Christmas! In the case of company 4, however, the shift across the continuum indicates instability. Harvard Business Publishing is an affiliate of Harvard Business School. Pages 22. Protecting and establishing technological leadership is an important project selection criterion. Amplify your business knowledge and reach your full entrepreneurial potential with Entrepreneur Insider’s exclusive benefits. In company 8, however, business unit decisions and planning are relayed through a system of paperwork. Hello Select your address All Hello, Sign in. One reiterates that the weapons are insignificant of the point of view of the consumer. Structural ties In the nine companies, the impact strategy has on the internal structure is clear. (A customer is broadly defined as the user of the product or process. Banking technology as a competitive weapon 1997: Winning strategies explained [Essinger, James] on Amazon.com. Its top managers came from different disciplines. Its products incorporate very sophisticated technologies that the customer does appreciate. The sword in this time period was the most personal weapon, the most prestigious, and the most versatile for close combat, but it came to decline in military use as technology, such as the crossbow and firearms changed warfare. Top management connection In companies that exploit technology effectively, the top business managers see themselves as responsible for making and approving technology decisions. Originally conceived to covertly detect concealed guns and knives, our fully integrated platform cost-effectively secures perimeters (i.e. The business manager is responsible for all decisions, including many activities—such as economic analysis, forecasting, and manpower planning—that other organizations usually assign to staff. HTC next to accuse Samsung of using component supplies as a "competitive weapon" Apple isn’t the only company grappling with its relationship to Samsung as both a smartphone component supplier and handset competitor. Its R&D efforts, mostly divisionalized, are well managed but concentrate on putting out fires. In forming such a business strategy the companies sacrifice a healthy balance among their functions.4. Some projects, such as those leading to Land’s invention of instant photography and Carlson’s haloid (Xerography) process, are the result of technological push. For an article addressing this topic see Frederick W. Gluck and Richard N. Foster, “Managing Technological Change: A Box of Cigars for Brad,” HBR September–October 1975, p. 139.