Dynamic Integration of Strategic Management and Information Technology

Strategic uses of information technology focus on the improvement of customer/client services to increase the value of products, which in turn provides market power, enhancing profits. An external focus on customer/client services leads typically to higher revenues via product‐differentiation strategies, whereas the traditional data processing use of computers has been applied mainly to reduce costs. The leadership and expertise of modern management are necessary to shift emphasis to applications of information technology. Strategic opportunities are in (a) helping buyers, suppliers and consumers to improve the purchasing, supplying, using, maintaining, and replacing products or services, (b) introduction of new products or services based on surplus market information plus information processing capability, and (c) changing the public's ability to use information technology and providing new ways to serve customers.