Organization of Information Technology and Information Systems - Case Study Example

Organization of IT and Information Systems Introduction Before going into the discussion regarding use of information technology in an organization, let us first describe information technology in order to get a better understanding of how use of information technology can prove to be beneficial for a company. Schneider (2010) states, “Information technology is the use of computers and software to manage information”. Information technology department of a company performs various functions related to the management of information. Some of the core functions of information technology department include storing, protecting, processing, and retrieving required information. Computers, servers, and data management systems are some of the key components of an IT department. These components perform various complex functions related to management of information. IT department of a company plays a critical role in the success of the company in the 21st century. Today, there is hardly any company or organization, which does not make use of information technology for managing data and information in an organized way. 2. Name of the company The name of the company, which I have selected for analysis, is Amazon. Let us discuss how this company makes us of information technology for carrying out the business tasks in an efficient manner. 2.1 Description of the Company Amazon is one of the leading global internet companies of the world. It is a platform for the sale of different kinds of products such as books, toys, furniture, and music CDs. Amazon holds the pride of being the largest retailer of America. Amazon Company was launched online by Jeff Bezos in 1995. Amazon S3 and Amazon EC2 are those products, which have contributed significantly to the success of the company. Farmer (2008) asserts, “Their core competency is their ability to develop and leverage their technology stack, including SimpleDB, EC2, and S3, towards making retail ultra-efficient”. Amazon Company has many competitors who are trying to snatch the market domination from Amazon but none of the competing companies has been successful in the purpose yet. Some of the major competitors of Amazon include Elastra, eMusic, and Alice.com. It is due to the implementation of an effective and efficient management information system that the company has achieved market domination in a very short span of time leaving behind all of its competitors. At present, Amazon is recognized as one of the largest online shopping companies of the world. In the later part of this report, we will discuss those factors that are driving use of the information system in the company. We will also analyze the impact of information system on the company in terms of benefits and limitations. Let us first get to know what management information system actually is in order to get a better understanding of the use of information system in Amazon Company. 3. Management Information System Oz (2009, p.9) states, “Information is the lifeblood of any organization”. Management information system means management of collected information, which is required to administer different business activities. Abel (2008) asserts, “MIS deals with planning, development, management, and use of information technology tools to help people perform all task related to information processing and management”. A management information system is a part of internal business control system that manages company’s documents, people, procedures, and information technology (Martin 2010). Stahl (2008, p.1) found that information systems promote efficiency and optimal control of business processes. Lauderdale (n.d.) states, “MIS allows managers to create reports about the company activities”. A company or organization can never be successful without implementation of a management information system because MIS keeps proper record of all information that is needed to run the business activities effectively. Dhillon (2010), in an article, found that the main task of a management information system is to ensure delivery of correct information to the intended receivers of the information. If we talk about the key tasks of a MIS, we can say that a MIS is capable of performing various tasks related to the management of information. Some of those tasks include documentation of the collected information, storing the information in appropriate locations, keeping track of the information, and assisting the concerned departments in processing of information. Lucey (2005, p.4) found that the main purposes of a management information system are to process the data into information and to communicate the processed information to the concerned people. LaRose (n.d.) asserts, “Management information systems are used to manage the data created within the structure of a particular business”. An efficient MIS is concerned with how and what information should be retrieved instead of deciding whether the information should be retrieved or not (Vitez n.d). One of the most important aspects of management information system is that it keeps the information up to date, which is essential for the success of any organization. Summers (2010) found that regular upgrading of the business information system is a very important process that every company or organization should implement. 3.1 Working of an information System Computer is the main component of any information system. All information about the companies is stored in the computers. In case of trading company, information about the customers’ orders such as customer name, product name, product specification, order delivery time, and payment information is stored in the computers for further processing. While talking about MIS, let us get some information about website, which is an integral part of any trading company’s management information system. “One of the easiest ways to help your business gain more exposure and potential customers is to have a professionally developed website” (Holub 2005). Website is an effective platform for communication between the companies and their customers. The request, which is made by the customers regarding any product, is stored in the computer of the company along with details of the order. When a customer’s request is stored in the company’s database, the concerned department makes use of the order related information it in order to deliver the requested product to the customer. Therefore, we can say that a website is not only an essential part of a trading company but also it is a key component of the information system of the company. 3.2 What Factors drive the Use of IS in Amazon Company? There are a number of factors, which force an organization to implement a management information system. Amazon Company has also implemented an efficient information system in order to keep up to date record of information. Let us discuss some of the factors in detail in order to know the impact of those factors on the success of Amazon Company. 3.2.1 Need of Information Management Need of information management is the first factor which has driven Amazon Company to implement an information system in the company. Almost every company, which has an online presence, needs to manage the customers’ details and other information in the database in order to carry out the business processes effectively. Amazon Company would have been a failure without the implementation of information system because Amazon is a customer-oriented company, which needs to be efficient in managing the customer related information. Therefore, need of information management was the primary force behind implementation of information system in the Amazon Company. 3.2.2 Details of Customers’ Orders Another factor, which played a major role in the implementation of information system in Amazon Company, was management of the details of the customers’ orders. Amazon Company runs its business through its website where customers place their orders and the company provides the customers with their desired products. This is the reason why it was important for the company to keep track of the customers’ details in an efficient way. 3.3.3 Need of Information Retrieval on Demand Information retrieval on demand is also an important factor behind the implementation of information system in an organization. In case of Amazon Company, information needs to be retrieved constantly for processing. Therefore, it was important for the company to implement an information system in order to facilitate the company’s employees in carrying out the business activities in an appropriate manner. 3.3.4 Need to Ensure Data Consistency Another important factor, which made the company implement information system, was need of data consistency. It is important for a company to collect the data from reliable sources and to process the collected data in a consistent manner. The users of information system do not find any difficulty in using the information if the data is processed consistently. Data consistency is extremely important for the implementation of an effective information system. A company needs to apply those procedures and techniques regarding data management that should be able to bring necessary changes to the business processes. Therefore, it was important for Amazon to implement information system in the company because of need to bring consistency in information management. 3.3 What are those Benefits that MIS provides to the Amazon Company? As mentioned earlier in the report, success of a company without the implementation of a management information system is impossible in the today’s world. It is because there is a lot of competition between companies these days and only those companies can get competitive advantage which keep up to date information about different issues related to the internal and external environments of the businesses. MIS provides the companies with various benefits related to the information management. Amazon Company also makes use of an efficient information system that has driven the company to the heights of success. Some of the core benefits for the Amazon Company due to the implementation of the information system include accuracy, timeliness, completeness, and relevance. Let us discuss those benefits in some detail. 3.3.1 Accuracy Accuracy is a key benefit of implementation of information system in a company. In Amazon, the information management department has enabled the company keep precise and accurate information on all aspects of the company’s business. All departments of the company make use of reports, which are generated by the information system. Information system has also provided the company with accuracy of internal controls, which is extremely important for the proper functioning of a company. 3.3.2 Timeliness Quick data processing is also one of the benefits provided to the Amazon Company. Timeliness is integral for an efficient information system because it results in improving performance of a company. It is due to the implementation of information system mechanism that the information is always ready to be retrieved by different departments of the company. The data collection and processing time has become very less which has resulted in saving time of the company’s employees and customers. 3.3.3 Completeness and Relevance Completeness and relevance are also two of the key benefits of implementation of information system in the Amazon Company. The users are now provided with complete but the most relevant information related to any specific matter. Information is presented to the concerned users in the form of reports. The information system of the Amazon Company provides only relevant information to the concerned departments because irrelevant information leads towards the wastage of time of the users. So, these were some of the benefits provided to the Amazon Company due to the implementation of an efficient information system. 3.4 Limitations of Information System Some of the limitations regarding implementation of information system in the Amazon Company include cost of employee training and expense of the information system implementation. However, these limitations can never overshadow the large number of benefits of the implementation of information system in the Amazon Company. 4. Conclusion Summing it up, information system is one of the integral parts of any online company as it keeps proper record of all information that is needed to run the business activities effectively. Amazon is one of those companies, which have implemented an efficient information system for the proper management of information. The implementation of the information system has played a key role in making the company reach heights of success in a very short span of time. Therefore, we can say that an efficient information system is a key towards success of a company in the 21st century. References Abel, O 2008, Knowledge Workers in the Information Age, viewed 31 December 2010, . Dhillon, T 2010, Data Management for Your Success, viewed 31 December 2010, . Farmer, J 2008. Amazon, the Tech Company, viewed 31 December 2010, . Holub, S 2005, Why Your Business Needs a Website, viewed 31 December 2010, . LaRose, M n.d., An Introduction to Management Information Systems, viewed 31 December 2010, . Lauderdale, C n.d., What are the Benefits of a management Information System?, viewed 31 December 2010, . Lucey, T., 2005. Management Information Systems. 9th ed. London: Thomson Learning. Martin, S 2010, An Introduction to Management Information Systems, viewed 31 December 2010, . Oz, E., 2009. Management Information Systems. 6th ed. Massachusetts: Cengage Learning, Inc. Schneider, L 2010, Information Technology – Definition and History, viewed 31 December 2010 . Stahl, B., 2008. Information Systems: Critical Perspectives. 6th ed. Oxon: Routledge. Summers, I 2010, Guide to Upgrading Your Business Information Systems, viewed 31 Decemeber 2010, . Vitez, O n.d., Limitations on Management Information Systems, viewed 31 December 2010, . Read More