Competitive analysis of enterprise integration strategies

Purpose – The purpose of this paper is two‐fold: first, it sets out to suggest that when a new ERP system or an upgrade is considered it may be best to begin with a formal analysis of the market leader's IT strategy. This study must address how they use information across the extended enterprise from suppliers to customers. Second, it aims to suggest a simple competitive audit matrix (CAM) that can be used to structure this analysis. Design/methodology/approach – The argument that a formal analysis is necessary to minimize the risk of disappointing ERP results is developed from the literature, and the CAM is adapted from a model presented in the “competitive analysis of the firm” literature. Because, inside data are usually not available, the model is designed to rely on publicly accessible data. Findings – While there are considerable challenges in undertaking a competitive IT analysis, the use of a case study, 7‐Eleven Japan, suggests that there is much to be learned by following a structured approach at this early stage in the development of an ERP project. Research limitations/implications – Since, this appears to be the first paper focusing on the use of competitive data in establishing IT strategy, there is considerable opportunity for others to verify the usefulness of this approach, to use the framework in uncovering strategies that are common to market leaders in different industries, or to suggest other frameworks altogether. Practical implications – Companies that are considering an ERP, or more likely an upgrade to an existing ERP, should find this simple framework most useful in provoking the kinds of discussions that are necessary before major strategic IT decisions are made. Originality/value – This is the first paper that presents a framework for undertaking analysis of a competitor's IT integration strategy.