Page 150 - DCAP302_ENTERPRISE_RESOURCE_PLANNING

Enterprise Resource Planning

notes (b) Availability: As most of the companies become more and more dependent on IT,
it is very important to ensure the maximum availability of the services. This does
not mean that all IT systems have to be absolutely flawless and foolproof but good
thought has to be given to what could be the consequences for the company if all or
part of the IT services are temporarily unavailable and what can be done to minimize
these consequences.

(c) Agility: market changes constantly and so does legislation and technology. It is said
that the product lifecycle and their time to reach the market are getting shorter and
shorter as a consequence, IT systems have to be built for maximum agility cross
compatibility, reuse and lightweight functionality are the ideas to be considered.
4. Competitive environment analysis: Porter’s five force model studies the five driving forces
in an industry which are as follows:
(a) Barriers to entry:
(i) Absolute cost advantage
(ii) Proprietary learning curve

(iii) Access to inputs
(iv) Government policy
(v) Economies of scale
(vi) Capital requirements
(vii) Brand identity

(viii) Switching costs
(ix) Access to distribution
(x) Expected retaliation
(b) Threats to substitutes:

(i) Switching costs
(ii) Buyer propensity to substitute
(iii) Relative price performance of substitutes
(c) Bargaining power of buyers
(i) Bargaining leverage
(ii) Buyer volume

(iii) Buyer information
(iv) Brand identity
(v) Price sensitivity
(vi) Product differentiation

(d) Bargaining power of suppliers:
(i) Supplier concentration
(ii) Importance of volume to supplier
(iii) Differentiation of inputs
(iv) Impact of inputs on cost or differentiation

144 LoveLy professionaL university