BU415 Chapter Notes - Chapter 7: Information System, Competitive Advantage, Sociotechnical System
Document Summary
The primary role of functional and general managers in business organizations is to contribute to the creation and appropriation of economic value. Added value is one of those terms used to convey the idea that a firm is doing something worthy of attention. The analysis of added value is a formal mechanism that managers and analysts use to evaluate how much of the value created the firm can appropriate in the form of profits. Useful when: you are endeavoring to create value in novel ways and offering things that no competitor is currently offering, you are evaluating how to respond to a competitor who took the leadership position. The analysis of added value can help you measure how much benefit your competitor is drawing from the innovation and what benefits are likely to accrue to you if you choose to replicate the initiative. A disciplined analysis will help you carefully analyze the potential of the initiative.
