Part A: Question 1 A. Porter's five force model includes the following: Supplier Power. This is how much the supplier is able to give to the organization, the volume that is included, the impact of cost for the supplies, the use of substitutes for the supplies and the integration of other supplies as a threat. Threat of substitutes. This includes the change of costs, the buyer's capacity to substitute supplies for another supply, and price-performance. Buyer power. This includes the capabilities that the buyer has to purchase, and includes components such as volume, information, identity, understanding products, having substitutes and the incentives of the buyer.
Barriers to entry. This is the costs, policies, economics, requirements, brand identity, access to distribution and retaliation that could occur with the product. All of these are linked to the rivalry aspect of the business, which includes exit barriers, fixed costs, industry growth, product differences and corporate stakes (find an Amazon) This particular model is applicable to Microsoft because of the products and changes being made within the industry. In relation to supplier power, this links to the capabilities of those who are making the technology products.
Specifically, Microsoft is put into demand over the innovations of the products as well as the durability of the products that are introduced to buyers. This is linked to the rivalry as the ability to have innovation of the products will allow for the Microsoft products to stand out or to fail and will either result in growth of the Microsoft or the need to move into exit barriers. This is also linked to threat of substitutes. This specifically links to Microsoft's competition, such as the Mac.
The more that buyers become enlightened on the different innovations of Microsoft, the more threats there are towards substitution. This also relates to buyer power. For technological products, Microsoft is responsible to giving buyer power to individuals through providing knowledge about the technological products and how they stand out from the crowd. If this is not done, buyers will have the capability to go towards the competitors. This will also link to the rivalries, as Microsoft then has a responsibility to allow industry growth to occur related to the knowledge that is given.
The last aspect of this is the barriers to entry. The brand identity of Microsoft automatically provides capabilities away from the barriers of entry. In relation to this, the economics may affect this, with poor economics causing a loss in cost and capabilities to experience the rivalries, such as industry growth (Microsoft, 2008). B. The first example of how IS strategy can be used to develop Microsoft is to examine the strengths of Microsoft. This would include the innovations and the capacity to overcome barriers of entry with these innovations as well as with the brand of Microsoft.
The second way in which an IS strategy could be used is to examine the weaknesses of Microsoft. This would include the distribution and supplier areas, which may not be making the best supplies, as well as the competition which is also drawing on innovations in order to succeed (Microsoft, 2008).