How could IT provide a competitive advantage to a business?

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

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The simple fact that a company has IT cannot provide it with a competitive advantage because essentially every firm of any size has IT.  What can provide a competitive advantage is IT that is better than that of competitors.

The link below tells us that there are many advantages to having IT. It says that

Examples of IT's benefits to different areas of an enterprise include:

  • timely and efficient delivery of products and services
  • higher sales through better understanding of customer behaviors
  • cost savings from fewer staff hours and reduced human or machine error
  • better resource planning through detailed, accurate, and timely financial information.

Looking at this list, you can see where having better IT than your competitors would be useful.

If your IT system is better, you might have a superior database telling you what your customers like to buy, at what price, at what time of year, and other information like that.  This could help you to better plan what sort of inventory to have available.  If you have a better IT system, less time will be wasted on mistakes.  This will mean that you will have lower labor costs per unit of output.

Since IT is, as the link says, the "lifeblood" of any major firm, having better IT clearly is a competitive advantage.

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