ABSTRACT
Five key questions can be used to guide an assessment of the impact of IT on strategy.
A successful entry barrier offers not only a new product or service that appeals to customers but also features that keep the customers ‘hooked’. The harder the service is to emulate, the higher the barrier to entry. A large financial service firm sought to build an effective barrier to entry when it launched a unique and highly attractive financial product that depended on sophisticated software that was both costly and difficult to implement. The complexity of the IT-enabled product caught competitors off guard; it took several years for them to develop a similar product, which gave the initiating firm valuable time to establish a significant market position. During this time, the firm continued to innovate, enhancing the original product and adding value to the services. Competitors not only had to catch up, but had to catch a moving target.
