Strategic Use of Enterprise Resource Planning Systems In a world of information technology (IT) abundance, competitive advantage (CA) has little to do with access to technology. Indeed, because enterprise systems (ES) are the most adopted technology by businesses, it would be difficult for a firm to achieve a competitive advantage (CA) purely on the basis of having an ES.   Contents INTRODUCTION 3 COMPETITIVE ADVANTAGE 3 Factors that affect the IT system 3 Michael Porter’s Model 4 COST LEADERSHIP STRATEGY 5 Case Study 1- Walmart 5 Case Study 2- IKEA 5 DIFFERENTIATION STRATEGY 6 Case Study 1- Target 6 Case Study 2- Etsy 6 FOCUS STRATEGY 7 Case Study 1- PepsiCo. 7 CONCLUSION 7   INTRODUCTION Organization these days wants their information and data to be under proper security, analysis and monitoring, with an ERP system implemented, which would also be latest and updated in relation to the organization. Enterprise system involves all the important rebuilding activities to link all the departments and stages. Using ES system companies are using various achievements by adapting it, to compliment future strategies. In the following this essay discusses about all the competitive advantage, the factors affecting the IT system by an ES system, Michael porter’s model and achievements of the different sectors of competitive approach with two examples each. COMPETITIVE ADVANTAGE Competition determines whether a business will flourish in a long term. Strategies, by its definition means actions taken by a firm or party in lieu of taking consideration of other party or competitor. Many factors like firm’s ability to deliver new and innovative products, integral core culture of the firm come into play to deliver efficient results and performance. Competitive strategy can be defined as a process of finding the optimum point where a firm has a core competency and strength to maintain a long-term sustainable growth against all the market competitors. (PORTER, 1997) Competitive advantage can be defined as a set of favorable conditions in which a company or a country has got an upper edge to yield products and services at an affordable price in a convenient way for customers as well as company. As a result, it helps the company to accomplish better results in the form of higher sales accompanied by comprehensive margins than its opposition. (Intestopedia.com, 2016)However, these factors are regulated by various factors such as goodwill and quality of product, branding, supply chain network, cost distribution, copyrights and trademarks and customer service. Factors that affect the IT system Many people argue that innovation strategy management is when a company is able to incorporate new technology into their existing structure effectively. When EBay introduced online auction, it created a ripple throughout the world; or when Apple computers integrated software and hardware into one system, it was a bold move that led to the boom for company, are good examples of adopting new technology in early stage. Conversely, it can lead disastrous results if not complied with advancements. Such as, Kodak was such a hit in late 90’s or early 2000’s because of their unique pictography technology but led to their demise and bankruptcy, as they could not keep up with the latest trends of digital technology innovation (Quaddus, 2013). Some recommended fundamental aspects that decide if a company will become a big giant in industry or will lead to its end are as follow: - Scope of new opportunity: it determines if the company will be able to handle it effectively and if it’s the right time for it Products and services: As in textile and cloth industry because fashion comes and goes and it gets obsolete very quickly or people become bored very easily, so it’s very important for the organization to be an early mover to avail all the benefits. Seizing the perfect moment: Not all the times the person who takes the first step wins, sometimes firms need to make a wise decision keeping in mind their current situation and make the best move accordingly (Quaddus, 2013) Michael Porter’s Model Michael Porter’s five forces model is an important instrument in determining the competition in a particular industry and its associated factors along with it. As per Porter, a thorough industry analysis can shed some light on five competitive forces that include (Rapidbi, 2012): • Rivalry of competitors within its industry • Threat of new entrants into an industry and its markets • Threat posed by substitute products which might capture market share • Bargaining power of customers • Bargaining power of suppliers Michael Porter classified the firm’s core competency into two major parts: cost advantage and differentiation. Furthermore, they can be segmented into three general strategies that are cost leadership, differentiation and focus. These strategies are largely focused at business level as they can’t be categorized into firm or industry related branches (quickmba.com, 16). COST LEADERSHIP STRATEGY The core element behind this strategy is to avail the benefits from the cost effective products produced by the company. An organization relies heavily on this strategy for the optimum utilization of its resources with the help of elevated managerial efficacy that will eventually reflects in company’s leaders and performance (Hashem Valipour, 2012). However, this will work only if you have made decent investment in manufacturing sector and keep a tight watch on the supply chain to cut costs and avoid expenses wherever possible. This can be achieved by eliminating the usual hierarchy and eliminating different chains emphasize the authority and power into few hands to facilitate more control and accountability. Case Study 1- Walmart use of different case stusy Wal-Mart Stores Inc. has proved it to be very efficient in applying special cheaper prices approach quite successfully all around the globe. This concept of using this method is to set prices of products strategically at lower prices from the competitive market on a sustainable basis, so that to lure the customers towards their products and rule out the competitors from the market. Wal-Mart relies to make their profits from high volume of sales rather than focusing on advertising and marketing. Core principles behind its success are a huge, effective and solid supply chain management of products. They target indigenous suppliers directly and developing countries markets to relish lower exchange currency rate and thus, removing all the mediators from the chain as to avoid scattering of profits in the chain process. Hence, company makes huge profits from high volume of sales while keeping competitive margins (smallbusiness, 16). Case Study 2- IKEA use of different case stusy When Ikea entered the furniture market, it definitely turned around few heads in the existing industry by its unique style of operating business. Ikea provides urbane and pretentious furniture at very affordable prices. Strategy used is to outsource its products from developing countries where the prices of wages are low by providing fundamental and essential services. The idea behind this successful technique is to neither to assemble nor to deliver the products for the customers. Instead, customers are supposed to acquire the products from the store or warehouse of IKEA and assemble furniture at home with the help of very basic or no tools (smallbusiness, 16). This enables both customer and company to save valuable time, energy, useful resources and a lot of money. It’s called hitting dual targets from a single bullet, as in providing benefits for both the parties. Unlike many common existing suppliers, who provide bulkier products that are less convenient and high transportation cost, giving IKEA an upper edge. DIFFERENTIATION STRATEGY use of different strategy This strategy puts emphasis on providing exclusive and unparalleled products and services that are tailored to the needs of customer, leaving customer to choose you over competition every time. In turn, it will ensure loyal and long-term customers because their requirements are adequately addressed and they will choose company’s products over competition every time. A good example can be taken of Apple I phones; there are similar products available in the market by different competitors at cheaper prices but customers choose Apple because of their high user compatibility and exceptional customer care experience. This allows companies to usually charge a premium price that customers are happy to pay as well. Case Study 1- Target use of different case stusy Starting from a small town family startup, Target now has the ownership of many stores across country under its belt and still growing strong. Many of the accomplishments behind Target’s success are because of its differential policy approach it uses in all stores. They are renowned for their competitive and unmatchable discount prices available in whole market and has become one of the biggest discount store giants among K-Mart and Reject shop. Core competency of company lies in providing up to date, modern, creative and innovative goods that are used in day-to-day life, which other stores are unable to provide. Promoting latest products in a tactical way for the greater accessibility for consumers. Moreover, the whole store designs and layouts are well thought and planned to provide cheaper goods throughout year (Target Store, 2016). Case Study 2- Etsy use of different case stusy Etsy being an online artisan gallery of shopping store, which offers its buyers and sellers to showcase and sell their handmade wares and products to customers all around the world. As a crafter’s dream shopping site being a paradise for beginning, through its production and sales. Etsy has established a niche company of not only craft items but homemade items as well. On the internet crafters have found a home community and for amateur crafters the world has opened a place to sell their products for a good price. (Cleverism.com, 2016) The crafts of individuals and business investors are brought together through the business model Etsy has introduced. FOCUS STRATEGY use of different stratefy Where thorough knowledge and understanding of the markets are needed to study the individual needs of consumers, the companies to create the cheap and relevant products for the consumers use focus strategies. Consider a local merchant selling products in a niche market as per the taste of the local consumers creating a high level of loyalty from customer’s end. As a result, it makes it a very unattractive market for its competitors to enter, as they won’t be able to understand the taste and needs of customer (Mindtools.COM, 2016). In nutshell, it needs to be examined properly as to which strategy is used after carefully analyzing the existing market conditions from customer’s point of view. Case Study 1- PepsiCo. use of different case stusy PepsiCo is currently one the utmost rushed nourishment organization around the globe. Keeping in mind the end goal to essence on one fragment PepsiCo took optimal choice to turn off its corporate of eatery into an organization which is dealt on an open market independent organization. It moreover rebuilt its connotation and chose to isolate the packing operation shape that organization. It attained Tropicana Company keeping in charge in mind the end goal to reinforce its place in non-carbonated section. It furthermore a portion of the littler organizations like KFC, Pizza cabin, taco ringer and so on it gained Quaker oats with a specific end goal to items wellbeing and health items. Allude figure 7 for the key components of the procedure (The case center organisation, 16). CONCLUSION Before selecting a suitable strategy business should think wisely and carefully. Technology risks are present in porter’s strategy specially while change is being installed in an organisation it leaves the past works outdated and old fashioned with such experience, by having an competitive advantage it could be to have these advantages could be hectic. Thus various companies have a different working structure and outlook to their business strategies. The five factors can’t be established in every aspect of a business process. But multiple strategies can be combined in segments, which is successful mostly. WORD COUNT- 1820 approximately. References • Cleverism.com. (2016). Retrieved from Stand crowd examples: https://www.cleverism.com/stand-crowd-examples-differentiation/ • Hashem Valipour, H. B. (2012). The Effects of Cost Leadership. Asian Economic and Social Society. • Intestopedia.com. (2016, 09 04). Retrieved from http://www.investopedia.com/terms/c/competitive_advantage.asp • Mindtools.COM. (2016). Retrieved from https://www.mindtools.com/pages/article/newSTR_82.htm • PORTER, M. E. (1997). Competitive advantage creating and sustaining superior perforance. 07-10. • Quaddus, J. X. (2013). Managing Information Systems: Ten Essential Topics. Atlantic press, pp. 8-12. • quickmba.com. (16, 09 04). Retrieved from http://www.quickmba.com/strategy/generic.shtml • Rapidbi. (2012, 09 07). Retrieved from Porter’s Five Forces for competitor analysis & advantage: https://rapidbi.com/porterfiveforces/ • smallbusiness. (16, 09 04). Retrieved from http://smallbusiness.chron.com/examples-cost-leadership-strategy-marketing-12259.html • Target Store. (2016). Retrieved from https://docs.google.com/viewer?a=v&pid=forums&srcid=MDY2NDYyODM5NTQ1MTAxODU3NjcBMDYzMzA1NjcwOTQyMjM1MjAyNDQBS3VmVkM4WVdDeklKATAuMQEBdjI • The case center organisation. (16). Retrieved from EDUCATORS: http://www.thecasecentre.org/educators/products/view?id=19860