Articles on External Context Flashcards
(12 cards)
What is digital strategy formulation?
process of identifying elements of the firm’s business model subject to change according to the new strategy, along with the scope of the digital transformation
What is digital strategy implementation?
how firms translate digital strategy formulated into a concrete plan and set of actions.
What are the four components of the digital business model?
- Firm’s value proposition and market segments
- Structure of the value chain
- Mechanisms used by firm to appropriate value provided
- Relationship among these elements
What are the three strategic limitations of AI?
- Generic nature of AI
- AI manifests as a form of explicit knowledge
- Myopia
Why is the generic nature of AI a strategic limitation?
logic of algorithm isn’t unique to the user applying it, but can be rediscovered by anyone using the same procedure. Doesn’t create unique value for firm
Why is the explicit knowledge form of AI a strategic limitation?
Organizational knowledge driving a firm’s AI processes can be extracted through cyber-attacks and may be highly portable during employee turnover.
Identifying mechanisms for preventing spread of AI assets across firm boundaries is critical
Why is AI’s myopia a strategic limitation of AI?
AI lacks contextual awareness beyond their assigned tasks. This inability to recognize interdependencies between its task and other tasks in the firm is limited, which could result in expensive technical and operational failure.
AI will also lack a proper understanding of a firm’s strategy
What are the 4 conceptual building blocks for theorizing AI-driven competitive advantage?
- Capabilities and competitive advantage
- Situated agency
- Capability development
- AI characteristics
Which three sources of competitive advantage is focused on in an AI-driven competitive advantage?
- Firm-specificity: produced with cospecialized knowledge; greater value inside firm than outside
- Capability-development costs: cost must not supersede value earned form deploying capability
- Environmental fit: customers only respond positively if firm’s capabilities match their needs
What is meant with situated agency as an AI-driven competitive advantage?
Balance machine’s agency with human agency by structuring context in which AI makes sense of problems and applies solutions.
What are the three dimensions informing an actor’s behavior and how free choice may manifest?
- Iteration dimension: actions anchored in organization’s prior experience
- Practical evaluative dimension: actions anchored in organization’s present social context
- Projective dimension: actions based in actor’s ability to reimagine their organization’s present arrangements to meet future goals.
What are the four steps of capability development?
- Bundling strategic assets
- Embedding assets in routines
- Assembling routines as capabilities
- Matching capabilities to opportunities in environment
