IT Portfolio theory and business value returns for Gap
Identification of various IT assets and their business value returns mentioned in the case study using the IT Portfolio theory.
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Assets
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IT Portfolio asset class
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Business value
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Artificial Intelligence
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Informational Asset
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Artificial Intelligence has been acting beneficial for the GAP. As after the termination of the creative designers the company is completely dependent on the aspects of artificial intelligence in order to understand the trend and act accordingly to the set trend. this evaluation of the trend enjoys benefits of creating reference of the trend that must e followed during the course of the business.
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Big data
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Informational Asset
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Big data acts as the platform of artificial intelligence that has been used to analyze the target audience of the market that helps the brand to decode the style that the brand needs to develop to get into the top tire of the trends (Copeland, 2015). Big data also helps in understanding the demands of the audience that create the audience base of the brand.
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Branding
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Strategic Asset
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Branding of the organization is very important in today’s society as the clients depend on the brand more than the product that they are purchasing from the organization. This strategy of branding of the product- is considered to be one of the most efficient technology to market for the product that is to be launched in the market recently.
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Consumer Behavior
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Strategic Asset
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Customer behavior acts the most important aspect of evaluating the organization in case the organization has been dealing with the clothing that is completely dependent on the acceptance of the mass with regards to the daily change of mood of the clients on which the clothing company is based on (Ketokivi, M., 2016).
. This is the reason that checking o customer behavior observation plays an important role in the process of the building of the organization.
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Marketing
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Strategic Asset
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Marketing is the most important strategy for the clothing companies to set the tends in the society and uplift the characteristics of the organization as a global brand (Bonardi and Bergh, 2015). This growth in the brand stature is possible only with the help of the proper marketing of the product. This proper marketing of the product also engages the branding to the people who are the potential clients of the brand. The establishment of the brand happens only when the brand is able to reach out to the people and make the production of their brand reach the global level.
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Operational Management
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Transactional Asset
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Operation management is the most important aspect of any organization. This aspect gives the content of the fact that the methodology that has been proving to be the most important aspect of the organization as the operation manager is uncharged of the operations that are being undergone during the course of the manufacturing methodology (Sodhi, 2015).
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Predictive Analysis
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Infrastructural Asset
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Predictive analysis is required in the clothing organization as the trends that are to be coming in future has t be predicted in order to start manufacturing clothing with respect to the upcoming trend is prediction of the upcoming trend helps the organization to decide the trend of the clothing that are required to be made.
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To what extent does this organization have an IT portfolio which provides a balanced view of value, risk and return?
The organization has been very efficient in aspect of the IT Portfolio of the organization as the CEO of the organization, Art Peck has been eliminating the creative designers of the organization that has been not so beneficial for the organization and the downfall of the organization has been the major reason of eliminating the creative designers of the company (Gero, 2014). the designs that were created by the creative designers not being accepted well by the consumers of the brand this causes the downfall of the brand (Wu and Chiu, 2015). Hence Art Peck decided to eliminate the creative designers and base the company on the platform of the IT portfolio. The usage of big data was the most innovative thing that the CEO applied to the platform of the clothing company in order to increase popularity of the organization of the brand. The risk that was intruded by eliminating the organization was very high (Schaup, Dorminey and Dull, 2015). With this increase in the risk for the organization the probability to earn profits was also increasing as the organization was mainly focusing on the fact of dealing with the trends that were already established in the market and spotters were hired by Art Peck in order to spot trends in the social media sites which might act as an inspiration. The inspiration that was gained from the social media was to be implemented in the process of the manufacturing the clothes. Hence, in this case the risk and return trade off is directly proportional to each other leading to the condition of either growth in stature of the organization or downfall of the organization. In case the organization seeks success it will reach to the extreme level of success and in case it faces failure the organization will not have a backbone to stand back as the creative designers were expelled from their job prospect of the company.
Based on the Resource based view of the firm (RBV), develop a list of resources and capabilities that the organization has access.
Resource based View has been a very useful and efficient technology that is being used in order to gain the proficiency in the market with the resources that are available in the organization without introducing new instruments and the appliance to gain the market proficiency (Rousseau, 2017). The items that falls under the category of the Resource based View also acts as the resources that falls under the categories of the product that increase the competitive advantage to the organization over the other organizations that are present in the market providing competence to the organization.
Evaluation of Gap’s IT portfolio
The resource that falls under the fact of Resource based View are as follows: –
Financial resources fall under the terminology of the tangible resources. The financial resources of the organization constitutes the amount of the money that the organization has the potency to borrow (Copeland, 2015). In case of Gap the potentiality of the organization to borrow funds has been quite high.
Human resource falls under the terminology of the intangible resources. The human resource ideals with the knowledge that the employees of the organization (Schaup, Dorminey and Dull, 2015). The knowledge of the employees like the creative designer was not up to the level with the job profile of the company which caused the CEO of the company to expel them from their job profiles (Gero, 2014).
Physical resources falls under the form of tangible resources of the organization. The physical resource consists of the location of the firm and the raw materials to which the company will have access.
An innovation resource falls under the category of the intangible resources of the organization. This resources deal with the innovations that are needed to brought in to the company (Sodhi, 2015). These innovations bring n the much required benefits that are required to provide competency to the organizations that deal with same business plans (Ketokivi, M., 2016).
How do you think that resources and capabilities add value and rarity for Gap
Any resources that are being added to the resource list must fulfill the range of the VRIO (Wu and Chiu, 2015). The consolidation of the resources with respect to the VRIO area as follows: –
V- The financial resources are valuable to the organization as the monetary aspect of get organization counts the most important of the organization.
R- The financial resource is rare as it differs from all other organizations in this field
I- The cost of imitating the financial resources are very high as the infrastructure of the organization varies.
O- The organization of financial resources is very high as the excess cost is cut by expelling the unwanted employees
V- The human resources are not valuable to the organization as the CEO of the organization has expelled the employees and has preferred the usage of artificial intelligence using the platform of big data (Bonardi and Bergh, 2015).
R- The human resource is not as rare as it does not find importance with respect to other organizations in this field.
I- The cost of imitating the human resources are very low as the employees that were in the high hierarchy of the organization as the CEO has terminated the creative designers due to the lack of impact.
O- The organization of human resources is very low as the excess cost is cut by expelling the unwanted employees
V- The physical resources are valuable to the organization as the location of the organization aspect of get organization counts the most important structure of the organization.
R- The physical resource is rare as it differs from all other organizations in this field
I- The cost of imitating the physical resource is very high as the infrastructure of the organization varies.
O- The organization of physical resources is very high as the infrastructure of the organization is very well built.
References
Bonardi, J.P. and Bergh, R.G.V., 2015. Political knowledge and the resource-based view of the firm. The Routledge Companion to Non-Market Strategy, pp.12-28.
Cohen, P.R. and Feigenbaum, E.A. eds., 2014. The handbook of artificial intelligence (Vol. 3). Butterworth-Heinemann.
Copeland, J., 2015. Artificial intelligence: A philosophical introduction. John Wiley & Sons.
Gero, J.S. ed., 2014. Artificial intelligence in design’91. Butterworth-Heinemann.
Ketokivi, M., 2016. Point–counterpoint: Resource heterogeneity, performance, and competitive advantage. Journal of Operations Management, 41, pp.75-76.
Miemczyk, J., Howard, M. and Johnsen, T.E., 2016. Dynamic development and execution of closed-loop supply chains: a natural resource-based view. Supply Chain Management: An International Journal, 21(4), pp.453-469.
Rousseau, H.E., 2017. Corporate sustainability: Toward a theoretical integration of catholic social teaching and the natural-resource-based view of the firm. Journal of Business Ethics, 145(4), pp.725-737.
Russell, S.J. and Norvig, P., 2016. Artificial intelligence: a modern approach. Malaysia; Pearson Education Limited.
Schaupp, L.C., Dorminey, J. and Dull, R.B., 2015, January. A resource-based view of using social media for material disclosures. In System Sciences (HICSS), 2015 48th Hawaii International Conference on (pp. 2396-2405). IEEE.
Sodhi, M.S., 2015. Conceptualizing Social Responsibility in Operations Via Stakeholder Resource?Based View. Production and Operations Management, 24(9), pp.1375-1389.
Wagner, G. and Choset, H., 2015. Subdimensional expansion for multirobot path planning. Artificial Intelligence, 219, pp.1-24.
Wu, L. and Chiu, M.L., 2015. Organizational applications of IT innovation and firm’s competitive performance: A resource-based view and the innovation diffusion approach. Journal of Engineering and Technology Management, 35, pp.25-44.
