Technology in Business and Business Processes - Essay Example

Contemporary Research in the Area of Business Information Systems By Introduction With the emergence of information technology by the late 20th century, the global business spectrum has undergone tremendous changes, and companies began to depend increasingly on technology to manage their daily business activities. In addition, business organisations computerised their supply chains to maintain optimum inventory levels and to deliver right quality of products to customers in a timely fashion. Evidently, technological advancements also benefited businesses to perform better in terms customer relationships management and thereby build and maintain a strong customer-vendor relationship in the long term. With the turn of the 21st century, competition intensity significantly increased in the global business environment, and hence firms began to invest ever more in technological development. Companies also introduced highly advanced technologies such as business information systems and management information systems to improve the flow of information across different levels of management and enhanced the speed and accuracy of decision making. This paper will discuss the importance of technology on business and business processes in the light of growing influence of information systems and management information systems in the business environment. The paper will also evaluate the role that information systems have played in the emergence of electronic business. Technology in Business and Business Processes Regardless of the size of the business, technology can have both tangible and intangible influences that would benefit organisations to meet customer expectations effectively and to maximise profits (Fernando 2011, p.35). The technological infrastructure can notably impact the culture, operational efficiency, and relationships of a business. According to an opinion, with the growing popularity of computer and information technology, it has become inevitable for businesses to rely on these technologies to enhance their supply chain efficiency, speed, cost efficiency, and the ability to handle multiple tasks with little chance of error (George 2008, p.6). Today computer technology is really important for business houses in dealing with their office routines, identifying and seizing newly emerging business opportunities, performing financial accounting, and for managing a wide variety of other tasks effectively. The application of technology, particularly computer technology, has assisted businesses to reduce their manual labour efforts noticeably and to save a great deal of time, effort, and money (Williams 2005, p.na). While analysing the importance of technology in business, it seems that technology is vital to enhance better communication, which is the key element determining the supply chain efficiency of an organisation. With the recent advancements in communication technologies like WhatsApp and other free instant messaging services, it is easy and inexpensive for employees to interact with their managers and clients quickly and effectively. In addition, improved communication is essential for businesses to create a strong public image and to enhance corporate reputation. According to experts, technology greatly aids businesses to identify their cash flow needs timely and effectively and to preserve precious resources such as time and physical space (Götze, et al. 2007, p.22). Warehouse inventory technologies assist firms to maintain optimum inventory levels and eliminate the possible financial losses resulting from under and excess stock conditions. Since technology is able to improve employee interactions at different levels, it can play a notable role in shaping the organisational culture of a firm. Today advanced technologies are available to combat security threats and vandalism effectively, and this in turn would add value to the security and safety of business transactions. Finally, technology is important for businesses to improve their research capacity and thereby acquire new potential opportunities. Similarly, technology can have a great impact on business processes. Evidently technological advances can significantly influence the way the work is accomplished in manufacturing, and this situation naturally leads to changes in business processes. According to Peter Terwiesch, chief technology officer (CTO) of power and automation supplier ABB Ltd in Switzerland, technology driven outcomes such as integration of systems, sustainable manufacturing solutions, energy management, and work team collaboration may positively impact business processes by saving time, money, resources, capital, and operating expenses over the lifetime of the manufacturing plant (Automation World). Terwiesch adds that integration of systems reduces engineering and operator efforts to a great extent. In addition, this facility is will cut down overhead costs and eliminate excess inventory by providing real-time visibility into what has been occurring in the plant (Ibid). Use of advanced technologies may assist firms to make their business processes safe and protect people that work on it. Technological developments may be capable of reducing the complexity of business processes thereby contributing to greater performance efficiency. Another major impact of technology on business processes is that effective application of technology can play a notable role in reducing the process wastage to a great extent. Role of information systems An information system can be simply defined as a system consisting of people and computers that performs the functions of processing and interpreting the information. “Information system technically as a set of interrelated components that collect or retrieve, process, store and distribute information to support decision making, coordination, control, analysis, and visualisation in an organisation” (Zaman & Robinson 2009, p.894). In the context of a business environment, information systems can play a significant role in underpinning competitive advantages and developing strategies. Information systems can greatly assist businesses to enhance adequate use of data, reduce workload, and operate in well compliance with various mandatory regulations. Information storage and analysis is a major role performed by information systems. Through the adoption of well designed information systems, organisations can take advantages of sophisticated and comprehensive databases that contain every possible piece of data about the firm (Rob et al 2008, p.531). Information systems are capable of storing, updating, and even analysing the information, and hence companies may find it easy to pinpoint solutions to current or future issues. In addition, these systems are able to integrate data/information from various sources, inside and outside the organisation, keeping the top management well informed of the internal performance and external opportunities and threats. Business information systems can really assist companies to make sound strategic decisions. It is evident that long-term success of a business organisation largely depends on the potentiality of its strategic plans. Top managements rely on information systems to frame potential strategic plans and make decisions in the best interests of the longevity and prosperity of the organisation (Khosrowpour 2002, p.740). Management professionals indicate that business information systems can really benefit organisation to form well informed decisions by delivering all the necessary information. The process of decision making involves choosing a particular course of action from several alternatives available and performing the corresponding tasks. When a business is provided with up to date and adequate information, it can easily and confidently make the choice. If two or more choices look appealing, companies can use information systems to analyse different scenarios. For each choice under consideration, the system can scrutinise key indicators like sales, costs, and profits so as to identify the alternative that can deliver most beneficial outcomes. In addition, business information systems can help organisations evaluate information from external references like Reuters or Bloomberg that provide a range of valuable information regarding the general economy. A deep evaluation of and comparison to market trends is greatly helpful for organisations to analyse the soundness of their strategic decisions. Information systems can play a significant role in designing and implementing a large number of value added systems in the organisation (Nickerson et al, ). For instance, the better integration of information systems with the manufacturing cycle may assist companies to make sure that the output they generate is in compliance with various quality management standards. Information systems can increasingly simplify business processes and eliminate unnecessary supply chain activities (Song et al 2010, p.82). In addition, these systems can greatly benefit business organisations to exercise better control over various employee processes and thereby enhance overall performance efficiency of the supply chain. Importance of management information systems Management Information Systems (MIS) can be simply defined as the study of organisations, technology, and people and their inter-relationships. In the word of Beekman (2001), “a management information system is defined as a computerised system that includes procedures for collecting data, a database for storing data, and software tools for analysing data and producing a variety of reports for different levels of management” (p.403). Firms use MIS mainly to realise potential benefits from investing in personnel, business processes, and equipment. One of the potential features of the management information systems is that it assists organisations to deal with decision making process effectively by providing accurate and updated information and performing analytical functions. MIS reflects information gained from the operations of the company. These systems use data/information generated by the working level and convert it into useful formats. Management information systems mainly contain information such as sales data, employee details, expenses, and investments (Oz 2009). If a company needs to know how much profits it has made over the last five years so as to make a business decision, MIS can provide the company with accurate reports containing the information required. In the view of Markgraf (n.d.), the capability to run scenarios is a crucial aspect in decision making and the MIS performs better in the regard. Some management information systems have built-in scenario running features whereas some others are capable of providing the informed needed for running scenarios on other applications like spreadsheets. What-if scenarios would greatly assist organisations to identify how different variables may change in accordance with a particular decision (Elearn 2009). Using MIS, firms can run scenarios like reduced staff levels or increased promotion budgets to understand what happens to revenue, expenditure, and profit for different levels of cuts or increases. Management experts indicate that MIS plays a crucial role in promoting realistic scenarios possible. Any decision a company takes may lead to changes in projected company results, and thus may require appropriate modifications to the existing business strategies and overall organisational goals. MISs either have the trend analysis feature built-in or can provide adequate information that may facilitate such an analysis. Generally firms depend on business strategies like projections for all fundamental operating results. A trend analysis can really benefit organisations to identify what these results would be in the current situation and how they may change once the proposed management decisions are implemented. The new values may be potential enough to form the basis of the firm’s future strategic approach. While a business organisation forms decisions with specific goals in mind and have the proper documentation from MIS and trend analysis to support the decisions made, it should track company results to make certain that they progress as they planned. Management information systems are really beneficial for businesses to assess whether their decisions have had the desire effect, or whether corrective actions are required to achieve the goals. If the management finds that the operating results do not develop as planned, it can use MIS to evaluate the situation and take proper additional measures to improve the situation. Role of information systems in the emergence of electronic business Researchers claim that information systems play an inevitable role in the emergence of electronic business. It is obvious that information systems can help users access and understand information clearly and respond immediately and effectively to the information. This potential feature of information systems is really essential in the electronic business sector because end customers in the e-business sector cannot make a sound purchasing decision unless they can access and understand the information required. Modern businesses do not hesitate to invest in information systems for a variety of reasons. E-business experts like Karake-Shalhoub (2002, p.ix) claim that information systems are greatly beneficial for this business sector to enhance operational excellence. As these systems are capable of providing business managers with a wide variety of information about the workforce, business processes, and supply chain flaws, they can benefit e-business managers to improve the overall organisational productivity. In addition, these systems provide abundance of information relating to supply chain activities ranging from material acquisition to the delivery of finished goods, leading to greater supply chain efficiency. Increased agility is another potential benefit of information systems for the electronic business industry. Industry practitioners suggest that information systems assist the e-business sector to develop new products and services in accordance with the existing market trends. As a result, they can greatly aid organisations to operate in line with customer expectations and thereby gain competitive advantages in the marketplace. In addition, information systems are able to promote customer intimacy and service through enhancing customer management relationships. Therefore, information systems would assist the management to keep customers loyal to the company in the long term. To be more specific, information systems facilitate effective and quick flow of information across various level of organisation, and hence they can benefit the organisation to make well informed business decisions. When it comes to decision making, information systems noticeably contribute to the speed and accuracy of the decisions. Researchers opine that use of information systems has significantly aided companies operating in the e-business sector to increase their market share and to add to shareholder values. Comparing e-business firms that use information systems with those do not use, it seems that companies relying on information systems have great access to a range of potential information regarding internal and external market environments. As a result, those companies can proactively respond to future market opportunities or threats, and this in turn would aid the organisations to improve their market competitiveness. Therefore, application of information systems can notably contribute to the long term survival of e-business organisations. Since information systems facilitate fast decisions making, stakeholders such as suppliers and creditors would not face any delay in getting their service. This situation can really assist businesses to keep in good relations with their stakeholders and to enjoy the synergies of combined operation. Finally, information systems can also help e-businesses to know the recent governmental regulations and avoid the possibility of lawsuits. To sum up, these systems greatly contribute to the fast growth of the e-business sector. Conclusion From the above discussion, it is clear that technology can have great influence on a business and business processes. It was the advancements in the technological landscape that drove the dramatic business growth worldwide over the last two decades. Technology plays an inevitable role in every area of the business, and hence modern business managers tend to invest increasingly in the technological infrastructure. While analysing the influence of technological sector on the business, it is evident that development of computer and information technology extremely benefited the business landscape to enhance its performance efficiency. Similarly, modern businesses increasingly rely on information systems to gain competitive advantages over their market rivals and to develop potential strategies. Information systems notably contribute to the implementation of strategic decisions by promoting information storage and analysis. Use of well integrated information systems can better assist organisations to maintain sophisticated and comprehensive databases that provide the top management with every piece of crucial information. Management information systems generally contain information such as sales figures, workforce details, expenses, and investments, and they benefit firms to make well informed strategic business decisions. The capability to run scenarios is a potential feature of MIS that helps organisations to understand what happens to revenue, expenditure, and profit under various scenarios. Finally, information systems play a vital role in the emergence of the e-business sector. They can greatly aid companies to enhance operational excellence through influencing productivity, efficiency, and agility. 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