Strategic Impact of Business Systems on Market Competition
The business world comprises of making profits while delivering quality goods and services. The business managers should plan, organize and staff the right personnel to help achieve the business objectives. Businesses today require involving latest technological advancement in their operations to improve quality and efficiency in business. Management may want to acquire a system that would help fight competition by having a system that would tap into competitors’ actions and strategies. This would help them have prior knowledge of the competitors’ next moves. This paper highlights the strategic impact of having a system that gathers competitors' customers’ information to a business. It also elucidates the effects of the system to the customers and its ethical focus.
Many companies closely monitor the activities of their competitors to gain competitive intelligence. The information about one’s competitors makes the difference between winning and losing a battle hence significant in the business world (Turban et al, 2006). Acquiring new systems has to undergo a rigorous process to ensure that the system purchased delivers its goals. The advantages of having a system that would tap into competitors’ customers include;
It helps identify the competitors’ consumer strategies, which make them standout and pull many customers. The system helps a manager know how to approach the competitors’ market through sufficient strategies that counter the level of competition. It is advantageous to have knowledge of the type and level of competition a business faces in the market. It would help plan for effective and efficient operations to win over some of the competitor’s customers (Turban et al, 2006).
Another advantage that a business would have from information on the competitors’ customers is the level of expected innovation and differentiation needed in production or marketing. The information from the customers would show the product they prefer. This would help a business organization and management to counter the competitors’ innovative level through differentiation. It also helps in quality management of the products produced or marketed maintaining high standards and affordable pricing (Turban et al, 2006).
It is also advantageous to have customer information as it helps a business strategize on niche marketing. The knowledge of customer needs and expectations in a business or product help, in delivery of services effectively, as they are the main business assets. The system would help managers to focus on a unique niche in the market as their target market. The age, preference and technical advancement needs of the customers help in shaping the strategies and production lines of businesses (Cronin, 1996).
There are disadvantages involved that may arise from having a system that gives information on competitors customers. They include; misinterpretation of data received that yields poor strategies. Strategic management is about prediction of the future through a series of favorable factors. The data received through the system is useful in strategizing how to counter competition with predictable actions. The limitations of the system arise when managers’ decisions fail to make achievement of the intended objective difficult. This may be inform of poor pricing, poor entry in the market leading to making losses (Cronin, 1996).
Implementation of a system that gives information on the competitors customers may lead to ethical malpractice by the business. It is prudent to note that conducting research on the customer needs is a business prerogative; it is unethical to spy on the competitors’ operations and especially customers. It is unethical to tap in the relationship between a client and the business provider. For example, a client in a bank should not have his details and relationship with the bank exposed to outsiders. This compromises the safety of the client’s privacy making him lose trust in the bank and shifts allegiance to the other providers. This unethical behavior prompts the bank to lose many customers as well as the unethical spying bank. The system would be disastrous to the operations of businesses as it would make the client’s fill trapped, which is not their expectation (Lawrence, & Weber, 2008).
It is also unethical to check on the competitors customers with the view of initiating unhealthy competition in the industry. This compromises on the quality of services and makes the industry to collapse. For example, having unhealthy competition in the health sector would cripple such a noble and basic service making the quality low and driving the costs upwards. It is prudent to conduct businesses and implement systems that take to account impacts of the overall industry.
The customers that the system investigate do matter on their type either businesses or individuals. The information that the system portrays to the managers of the business helps them strategize on their counterproductive plans that they would use to gain competitive advantage. These differences involve the differentiation of products, the marketing strategies as well as pricing of the products. For example, explains the level of discounts available to businesses and individuals (Lawrence, & Weber, 2008).
It is evident that conducting research on the competitors’ customers gives business knowledge of the market as well as the level of competition. Although it is prudent to have a system that shows such information, it has some ethical concern especially when utilized to malign the competitors’.