This paper reports on a case study of the successful use of various constituents of the Information Systems and Technology that are implemented in an entrepreneurship organization, Dubizzle.com, in the United Arab Emirates (UAE).
It seeks to communicate, and demonstrate how technology affects competition in today’s market place. In addition, the paper provides some guides in analyzing the needs for integrating technology in the corporate strategy. In order to achieve the above objectives, this paper will identify how Dubizzle.com uses technologies to create a strategic competitive barrier in efforts to attain a consistent competitive edge in its market. The plan is to analyze and interpret Dubizzle.com in terms of technological hardware and software they are currently using and aim on using in order to increment on their competitive advantage in their respective markets.
Introduction
General misconceptions on IT and IS:
1.The first misconception:
Various organizations and managements often have the tendency to make inaccurate assumptions regarding Information Systems and Technology. These assortments of misperceptions are firstly, that IT and IS are mere technical terms used to describe computers systems and can be used interchangeably. This notion is absolutely impractical and inaccurate since, there is a distinct difference between IT and IS. IT refers to the various technology oriented hardware that could be implemented in an organization. Whereas, IS includes all the different software that installed in a companies or institutions. Although, it is extremely crucial for both IS and IT to work in tandem by complimenting each other. It is more so significant for various institutions to indentify the difference amongst the two.
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2. The second misconception:
The second misconception that generally exists regarding IT and IS, is that not all firms require innovative and up-to-date IT and IS solutions. This statement is a misassumption predominantly because IT and IS not only become a stepping stone for organizations in achieving in overall business operational efficiency by reducing the prospect of error occurrences, but it also enables organizations to achieve the following benefits.
a. New product, services and business models:
This is attained through making these very operational and strategic processes faster, more time and cost efficient.
b. Customer and supplier intimacy:
This effectual interaction is achieved by creating an effective and a transparent channel of two-way and horizontal communications with the company’s suppliers and customers by reducing barriers of communication.
c. Improved decision making:
Through attaining significantly more accurate and up-to-date processed information which is the primary basis in making high- risk strategic decisions.
d. Competitive advantage:
Is also achieved through IT and IS since it enables firms to build on their switching costs, create barriers for their competitors to effectively compete in the market, and change the nature of the business competition through innovation and further development in its business model, products and services. e. Survival:
It is one of the benefits that are attained by many companies especially, small-scaled businesses; those who do not have financial or the technological prowess to achieve or maintain dominance in their respective markets for a consistent period of time.
Project Aims
The primary aim of this paper is to illustrate how present and potential IT infrastructure that is installed and implemented by Dubizzle enables them to attain a competitive edge in its market. Thereby, based on this unique yet real-life case, the paper seeks to explain that this successful venture can well be replicated in virtually any market, by any firm who seeks to implement their IT infrastructure at the right place, at the right time. The secondary objective is to clarify and eliminate the aforementioned common misappropriations regarding IT and IS. Moreover, explain how the trend and traditional approach towards perceiving it is evolving.
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Reasons for choosing Dubizzle for this case study
The primary rationale behind choosing Dubizzle was because of its immense diversity in terms of the markets it caters to, the size of the company itself, and the nature of the competition environment that exists in its market as opposed to abundantly existing medium-scaled manufacturing firms. Moreover, irrespective of the differences that pertain to size and nature of these companies, both of types of these firms have been successful in implementing their IT infrastructure which has in turn allowed them to attain competitive advantages in their respective markets. Therefore, identifying and analyzing the IT infrastructure and the strategies of companies such as Dubizzle would improve and enhance our project outcome and its conclusiveness.
BUSINESS MODEL
Dubizzle is the largest online classifieds service in the UAE that publishes various advertisements, information and reviews on subjects ranging from jobs vacancies and requirements, to real estate and reviews on various restaurants and cafés in the UAE. Its business model is immensely reliant on advanced Information Systems (IS) which in turn enables it to become increasingly unique and grab a competitive edge in the market. Dubizzle is an organization with horizontal hierarchical structure where decision making and work is decentralized. However, its strategic decisions are performed by Sim B. Whatley and J.C. Butler who are the Managing Partners and Co-Founders of Dubizzle and are in effect, in charge of the entire organization. Dubizzle was initially located in Dubai however due to the immensely significant and rapid success it has received in the space of four years; it has expanded to the capital city of the UAE, Abu Dhabi in 2009. Dubizzle, owing to its relatively unique business model, has only one potential competitor/rival which is Souq.com that replicates and builds on the business model of the renowned Amazon online shopping website. Dubizzle is poles apart from the commonly found modest-scaled consumer goods manufacturing company in terms of its business model and the different market it caters to. Moreover, the company’s entire existence depends on its own Information Technology (IT) and the market’s IT infrastructure as it deals primarily in providing a service-oriented website.
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BUSINESS/ IT STRATEGY
Dubizzle has a distinct requirement to plan, invest and implement significantly on IT and IS. Dubizzle’s IT strategy is generally dynamic and is altered continuously to cater to their customer’s preferences which are constantly evolving. The organization does plan strenuously on consistently modifying their current business model which is heavily integrated with various IT and IS decisions due to the technology-oriented nature of the business. Thus, this also becomes their means of staying ahead of its sole rival Souq.com and other potential competitors. Their inclusion of other services such as providing reviews and updates on a variety of restaurants and clubs as well as various social and charitable events can be used as a case in point.
Dubizzle have empowered their staff in terms of deciding what mix of hardware and software to use which is generally subjected to the employee’s personal or experiential preference. For example, the standard hardware in terms of the computer systems that are provided by the organization to its employees are Toshiba laptops with quite competitive specifications comprising of a 2.2 gigahertz Pentium 4, dual-core processors (since they have quite a substantial amount of multitasking and troubleshooting to do), a 2 gigabytes DDR RAM and a hard drive capable of storing 250 gigabytes worth of data., The software they use for developing the Dubizzle’s website are primarily various open-source operating systems in the form of Linux and Ubuntu.
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PORTER’S FIVE FORCES
Along with the analysis and discussion of the infamous Michael Porter’s forces influencing the strategies of the aforementioned company, these five forces are to be tied to the crucial role that IT and IS play. 1 Threat of New Entrants:
The threat of new entrants in the market is definitely a major cause of concern for the Dubizzle management. Since as of now, this entire seemingly untapped lucrative market of the Gulf Cooperation Council countries is being shared by only two website- oriented companies, Dubizzle and Souq. Thus, there are various entrepreneurs and well-established companies that have taken notice of the potential this unexploited market possesses and are devising strategies to enter the market.
2 Threat of Substitutes:
Dubizzle faces quite a significant amount of threat from its various substitutes such as the well established real-estate and used automobile retail companies themselves which have just recently realized the fact that Dubizzle is capturing a share of their profits and market. Therefore, these firms are planning to launch a variety of substantially funded advertising and promotional campaigns to negate Dubizzle’s competition. The management of Dubizzle has taken this into consideration whilst devising and reformulating their website and their advertising model in the coming months. 3 Customers:
The third aspect of Porter’s forces that influence Dubizzle’s decisions and strategies are Dubizzle’s customers. Dubizzle’s website currently caters to a segment of the UAE market which considers these web-services to be rather unsought due to its uniqueness. Thus, there is a dire need for the management of Dubizzle to invest significantly on informative advertising for Dubizzle in order to create awareness in the minds of the consumers about the existence and benefits offered of using Dubizzle.com. 4 Threat of Current Competitors:
The fourth facet of Porter’s forces that demands utmost attention whilst formulating any strategic decision of Dubizzle is the threat of current competitors, which in this case is the presence of an equally innovative and a large-scale competitor in Souq.com. The latter is an intermediary owned and controlled by Jabbar Internet Group which including Souq.com, has 4 intermediaries in an aggregate. Their ability to raise substantial sums of capital for various investments and project can be a source of a major concern for Dubizzle, since they are a modest-scaled firm who are growing on a steady basis.
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Thus, the management of Dubizzle ought to be immensely judicious in their utilization of their funds in terms of investing in various investment or expansion projects since their margin of failure as opposed to that of Souq.com is quite minimal due to the variance in its size and the ease and ability to raise larger amount of capital if need be. This analysis of web-based companies such as Dubizzle shall aid in understanding how the successful implementation of IT and IS in tandem leads to proficient and informed strategic decision and ultimately enabling organizations to attain a competitive-advantage in vastly dynamic and demanding markets. 5 Suppliers:
The final constituent of Porter’s forces, are the suppliers of Dubizzle which provide the organization with various hardware and software such as operating systems and computers. Since, Dubizzle is not a large-scale company; it doesn’t have the luxury of being dominant over their suppliers whilst holding negotiations and purchasing their IT and IS equipment. Thus, it would disallow Dubizzle from seeking benefits of traditional trade discounts since they are presently not purchasing in bulk from the suppliers.
Conclusion
To conclude, this paper through examination of various IT and IS infrastructure and strategies that are implemented by Dubizzle; seeks to explain why they are the current bare-essentials for virtually any organization in terms of obtaining and maintaining a strategic competitive edge in their respective markets. Moreover, through significant analysis and illustration of various IT and IS mediums that are used by the organization, most of the problems resolved are sought to fulfill the paper’s primary and secondary aim.
