According to Ngai and Wat (2004), one of the benefits of HRIS is to increase competitiveness of an organization by using HRIS to improve HR operations. There are five competitive forces that mention by Shin (2001) which are rivalry among existing firm within an industry, threats of new entrants, substitute products, the bargaining power of customers and suppliers. “Although some have argued that today’s rapid pace of industry’s fundamental attractiveness, exposes the underlying drivers of average industry profitability, and provides insight into how profitability will evolve in the future. The five competitive forces still determine profitability even if suppliers, channels, substitutes, or competitors change (p.66).” (Porter, 2001 in Shin, 2001, p.165)
The example of rivalry competitive is KFC and McDonald, they are same in fast food industries which provide food service to customer and the food provided are almost the same. New entrants into an industry means there are new companies which provide same goods or services in a certain industry. Substitute product means that when the price of a product is high, we choose another substitute product which has lower price. For example, when the price of chicken is high, then we are not going to eat chicken but change to eat beef which provide protein to us also. Bargaining power of customer occur when there are lots of choices in market that customers are not limit to only one goods/ services provider. When there is bargaining power of supplier, which means that an amount of company need one supplier to supply their goods/ services, the supplier might increase the price of supplies which cause the cost of products for certain company force to increase.
Besides that, there are five competitive strategies which are cost leadership, differentiation strategy, innovation strategy, growth strategy and alliance strategy. Cost leadership means a company provides goods/ services with lower price compare to other company with same goods/ services, the company who able to produce goods in lowest cost would gain best profits. Some of the companies try to produce different products/ services from its competitive to gain more customers, this is differentiation strategy. Innovation strategy means produce a unique product that the other company do not have to attract customers. Another way to compete with competitor is to improve the company itself which is developed or expend the company, make it into global markets to gain more customers and profit. Alliance strategy includes of mergers, acquisitions, joint ventures and others. One of the examples of mergers is Google and Motorola, these two companies merge in order to compete with Apple. In addition, there are other competitive strategies such as look in customers and suppliers, build in switching costs, erect barriers to entry, build strategic IT capabilities and leverage investment in IT.
Reference
E.W.T. Ngai and F.K.T. Wat (2006). Huamn Resource Information Systems: A Review and Empirical Analysis. Personal Review. Vol. 35 No.3, pp. 297-314.
Namchul Shin (2001). Strategies for Competitive Advantage in Electronic Commerce. Journal of Electronic Commerce Research, Vol. 2, No. 4, pp. 164-171.
Porter, M. (2001). Strattegy and the Internet. Harvard Business Review. Pp. 62-78
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