The Application of Information Systems in Modern Organisations - Coursework Example

Information Systems in Organizations: ‘Quick Shop, a retail chain, grew 28% every financial cycle. Itbought a software package to manage its inventory and provided customers with a friendly point of sale interface with cartoon characters and amusing voices. The look and feel was good enough to drive people in and talk about it. Their success was not in selling more but in their great marketing strategy, creating a digital supermarket. They restructured the entire concept of digital workplace in creating a brand which everyone would follow for long. Information Systems and organizations influence one another. On one hand, Information Systems must be aligned with the Organization to provide timely, relevant, accurate and trustworthy information that important groups within the organization needs, to exercise better options in strategizing business decisions. On the other hand, the Organizations must be aware of and open itself to the influences of Information systems in order to benefit from new technologies. Information Systems have evolved in a way that system design techniques like Business Process Reengineering (BPR), Total Quality Management (TQM), Enterprise Resource Planning (ERP), Supply Chain Management (SCM) and many others have markedly brought changes which have filled the true meaning of an Organization’s visions and short term goals. Thomas Davenport (1993), a well-known BPR theorist, uses the term process innovation, which he says ”encompasses the envisioning of new work strategies, the actual design activity, and the implementation of the change in all its complex technological, human, and organizational dimensions”. It provides the organization to rethink and radically redesign their business processes to yield better revenue and more organized structure. BPR has helped giants like Procter and Gamble Corporation, General Motors Corporation in creating “Consistent Office Environment” and “common business communication strategy” (Booker, 1994). It has proven success to finance giants like Banc One Corporation, Bank Boston, Country Wide Funding Corporation and many others in organizing themselves for effective process delivery and helping them to generate better profit margins thus eliminating wastage of resources. It also opened doors to process monitoring techniques such as performance, time, quality and measurement from which every industry benefited. The contribution of information Systems towards Total Quality Management (TQM) is far and wide. It helps in simplifying the production process, benchmarking, reducing cycle time and improves the precision of design and production. SouthStream Seafood’s, an American firm involved in sea food business implemented TQM to organize its business structure. It was able to smoothly communicate with wholesalers and retailers thus generating huge profits. TQM is for an organization which does not need a radical change in their structure but would like to improve and put a check on its quality. Enterprise resource planning (ERP) systems have an enormous impact on business and organizations around the world (Howcroft & Truex, 2001; Swanson, 2000). ERP systems are in most cases implemented with the goal to improve some aspect of the organization, e.g., strategic, organizational, management, operational, or IT-infrastructure (Hedman & Borell, 2002). ERP systems are often assumed to be a deterministic technology, since organizations have to align their organizational structure, business processes and workflow to the embedded logic of the ERP system (Glass, 1998). Web-based ERP applications also help in effective Supply Chain Management by sharing data in real time with supply chain partners, improving the optimization decisions. This is particularly true for large retail chains and companies in the FMCG industry. ERP systems have helped giants like Microsoft, Coca Cola, Cisco and many others to implement an enterprise wide transaction framework. Customer Relationship Management (CRM) and Supply Chain Management (SCM) systems integrate technology in most of the crucial business processes so that an enterprise gets structured and optimizes the use of resources. SCM at HP keeps the inventory fresh (Rory J. O’ Connor). The principal idea of CRM is to acquire, enhance and retain the customers in any industry. The role of information systems here is in maintaining the customer choices, their performance reports and their likes and dislikes. It uses integrated systems to analyze the decisions regarding appropriate promotion offers to retain various customers. IBM boosts manufacturing capacity planning with CAPS (Capacity Optimization Planning System) (Kenneth). GUESS dominated the designer jeans and casual clothing market in 1980-1990. As it mushroomed into a corporate empire, it got difficult to manage. Working with Cisco Systems, it replaced a tangle of outdated networking equipment with up to date standardized technology. With software vendors like PeopleSoft and CommerceOne it created a network for its suppliers and retailers. Advanced systems like Knowledge Work Systems (KWS) keeps the organization up to date in knowledge, serve as internal consultants, acts as change agents, evaluates, initiates & promotes change projects. Computer Aided Design (CAD) implemented by The Maddox Design Group of Atlanta, Georgia, uses MicroArchitect CAD software from Idea Graphics for architectural design. Artificial Intelligence (AI) and Management Information Systems (MIS) play a great role in altering the life of an organization helping it to make crucial decisions faster with millions of data from different sources. Humans would take months to arrive at it. The impacts of Information Systems on Organization structure are varied. It flattens the organization, separates work from location, reorganizes workflow, increases flexibility, recast the management process and redefines organizational boundaries. The communication between the top and the bottom gets streamlined and all management jobs get more structured. It can support both a centralized and decentralized organization. The costs and benefits of IT to an organization can be further attributed as follows: The IS system will be able to cover the customer base well by spreading the good word of the company over the internet and also in general. It will be able to spread the business over a large domain of customers which may range from home users to bulk purchasers. The awareness of the company stands very important so that people get a chance to compare it with the competitors. The supply chain can be well managed. The customer information can be stored and managed well so that they are focused when catering repeat orders and services. The data will also serve as rich information to the degree of importance which a customer must obtain. Diversifications into other businesses are very important for business continuity and should be taken care really well to fetch more customers and provide them better and allied services for retention and indirect marketing. Most importantly the services can be rendered to a large variety of customers across a geographical region with B2B and B2C models. The feedback system can also be added so that future caterings can be handled better. The total sales and profit can be easily captured and produced to management with ease reducing a lot of manual operations. Employee turnover and floor space optimization can be made using an information system. The costs of IS can be moderately high in the initial startup but would reap greater benefits in the long run. Information strategy for any organization is purely based on their requirements to manage business and envelope operations into a system which would in turn effectively manage their resources and yield not only profits in the long run but satisfaction to its employees and customers. (Laudon, 2002). As per effectiveness goes, adopting a blend of in-house technology and outsourcing will help its business IT operations rather than transferring the entire IT infrastructure to one vendor. The critical applications can be developed in-house and other IT support jobs and data processing can be outsourced to several hosts of vendors so that the security is well maintained and data protection is not a threat. Outsourcing is selected for the following reasons: Primarily to exploit, at its best, the IT capabilities of the software and hardware vendors. Outsourcing IT development is a most effective way to stretch your budget. When managers plan IT development outsourcing, they usually make it their aim to cut down the companys expenditures by 30%. This is a figure that speaks for itself. Of course, theres always the risk of failure, but if you outsource prudently, youll afford to implement projects of such a scale that would be impossible for you to reach on your own. The need for state-of-the-art IT solutions worked out and innovations implemented with small losses, outsourcing may be the only way out. It will save from the nightmare of retraining employees (or even hiring new ones) and/or paying for re-equipment. Quality of services. Gaining high expertise form the software vendors to support owns IT support centers and infrastructure. The most important would be to get the people do what they have been hired to. Outsourcing is an excellent option but it requires some strategies to be put into place so that it works out well. The possible stuff which can be done is stated as follows: The foremost thing is to properly strategize the entire outsourcing process in the very beginning – at the thought generation process. It gets very important that a separate team is allocated to handle the entire outsourcing process. What is of primary importance is that, the employees must not be rotated in their job areas to handle both their present job employment and outsourcing process. Separate allocated teams will make it sure that their entire time is devoted in handling the process and devote their time in doing what they have been hired to do. The question of investment into outsourcing must be analyzed well. Certain amount of compliance must be obtained as part of the deal. Such as hiring an outsourcing agent for managing the resources and the outsourcing process. Whether the process will be handled by the agents or consultants or a separate team will be formed within the firm, at both ends, is a very tough decision which needs to be taken. The investment decision will require to be analyzed accordingly. All the compensation options must be decided effectively by the parties engaged in outsourcing decision and should make it certain that devaluation process should not affect the employees. Multiple vendors must be consulted for outsourcing IT operations and faith in a particular would pose a risk. The strategy must be in such a way that software vendors must be allocated IT services of the bank in a fashion that expertise can be pooled from a concerned one and others must be trusted with what they excel in. In that way, not every business function is trusted to a single vendor which has been seen to raise suspicions by the analysts. Confidence on a number of software firms would imply a greater integration of responsibilities on the part of the bank too. They need to manage the outsourcing process strategically so that every resource is tapped well for optimum usage and higher productivity. All the above factors collaboratively imply that outsourcing can be taken as a viable option in future. The internet technologies would make sure that the complex business processes are enveloped into information systems which focus on their functionalities widely. The WEB 2.0 technologies have contributed to its full extent. Main technologies associated with Web 2.0: 1. Blogs also known as “web logs” author of blog writes a daily journal on his/her website usually visitors to the website can post comments about blog entry blog entries are usually tagged with a key word so that old posts can be filed under a certain category and therefore searched for easily there are now photo Blogs and video Blogs (vlogs) example: http://www.techcrunch.com/ 2. Wikis web page or set of web pages that can be modified by anyone who has access to the page usually have a “history” function which allows users to see previous versions also has a “rollback” function to restore previous versions possibility of vandalism and mistakes but these are usually corrected quickly by other users example: http://www.wikipedia.org/ 3. Tags and social book marking a web application where you can create “tags” for different URLs that you find that interest you multiple tags can be created for one URL the application will then give you URLs that other users have tagged with the same exact tag a term you might hear related to tags is Folksonomy. This is a collection of tags that an individual has created for his/her personal use Other apps like Flickr (photos) YouTube (video) and Odeo (podcasts) allow their content to be socially tagged example: http://del.icio.us/ 4. Multimedia sharing websites that enable the storage and sharing of multimedia end users upload their own multimedia multimedia content examples: http://www.youtube.com (for video), http://www.flickr.com(for photographs) , and http://odeo.com (for podcasts) 5. Podcasts originally called audio blogs audio recordings in MP3 format can be played on desktop computer or other MP3 devices (most famous is Apple’s iPod MP3 player) video podcasts (vidcast or vodcast) now available example: http://www.apple.com/itunes/store/podcasts.html 6. RSS feeds and syndication user subscribes to “RSS feeds” from different websites user then installs software called an “aggregator” or “feed reader” onto their computer software periodically checks for updates in RSS feeds from different subscribed to websites and updates user with info from the feed one issue is that there are different RSS formats, and thus compatibility issues a new syndication system named “Atom” is an attempt to clear up these compatibility issues information about blog postings (usually the headlines) are made available via RSS feeds podcast listeners subscribe to RSS feeds to be made aware of new podcasts Concepts behind Web 2.0 according to Paul Anderson 1) Individual Production and User Generated Content i. Web 2.0 provides a tool that individual users can use which lowers the barriers to entry of publishing data (written or multi-media). ii. May be entering a new era where news will be delivered more by “citizen journalism” and the idea of “sources of authority” will change. 2) Harnessing the Power of the Crowd i. James Surowiecki wrote a book entitled The Wisdom of Crowds that has been very influential on the Web 2.0 style of thinking. ii. Surowiecki discusses that a solution to an issue can be created more intelligently by a group of people operating under specific conditions than by the smartest individual of that group. iii. A similar concept, called Crowdsourcing was given by wired journalist Jeff Howe. iv. Process of web-based out-sourcing where the obtainment of goods (multi-media, scientific solutions, etc.) can be obtained at websites that offer a repository for the internet community’s contributions. v. Affecting creative professions like photographers because people are willing to use images that are not the quality work of photographers but good enough for what is needed. vi. Scientific sites offer prizes for the person who comes up with a solution for unsolved R&D issues. 3) Data on an Epic Scale i. Web 2.0 techniques allow data to be managed on an epic scale ii. Example: Google or other search engines iii. Example: Amazon records customer’s book choices and then mines massive amounts of this data to come up with targeted recommendations for purchases iv. mash-up: a term that is used combining applications that manage data through Web 2.0 techniques to provide new services v. Example: HousingMaps.com combines Google Maps with the U.S. based Craig’s list of apartments available for rent 4) Architecture of Participation i. Creation of an application where normal use of the application causes the service to get better ii. This is the extension of the pre Web 2.0 concept of open source iii. The idea is if that the most successful services are where the website provides the architecture of easy-to-use-tools which encourages mass participation in the development of the service iv. Mash-ups are one example of this technique 5) Network Effects i. Products exhibit the network effect when the increased use of one increases the value to all customers (i.e. telephones, faxes, email services, Microsoft Office) ii. Many Web 2.0 services rely on the network effect such as MySpace and Facebook iii. Many Web 2.0 services have this in mind and so they create standards to that there can be interoperability between products 6) Openness i. A powerful force in Web 2.0 is the spirit of open innovation…the idea of data and techniques being available to all ii. Web 2.0 services help large amounts of data be available to all iii. Other Web 2.0 products such as the web browser, FireFox, are created with open source and have plug-in that allow for general public experimentation The future of the usage of Web 2.0 in Wikis technologies focus on the information management and integration of online databases and integrate the learning environment into every section of the public. The points of consideration are as follows: The information literacy issues for children must be thoroughly reviewed for better envelopment of collaborative thoughts and technology. Educating young people deeply about privacy, trust and the social web. For all participation, the profiles of all people are viewed by millions of people which often pose a threat. Libraries would be integrated digitally with online databases and video podcasting facility would be made available for ‘Anytime Anywhere Access’. The future of Wikis would make use of the internet technologies and the existing features of the technology to make it good. It must be done to foster better thoughts in the minds of people and share information. The Wikis form a large section of communication channel for collecting knowledge and information in depth across several channels. The advances of Information Systems meet the three proven targets of organizations namely customer satisfaction, effectiveness and efficiency. The rapid development in the IT field constitutes a driving force in itself to drive an organisation to reap its benefits. Works cited Anderson, Paul (February 2007). “What is Web 2.0? Ideas, Technologies and Implications for Education.” JISC Technology and Standards Watch. Chaffey, D., & Wood, S., (2005). Business Information Management, Improving Performance Using Information Systems, London: Financial Times/Prentice Hall. Davenport, Thomas & Short, J. (1990). The New Industrial Engineering: Information Technology and Business Process Redesign, in: Sloan Management Review, Summer 1990, pp 11-27. ICFAI (2002). ERP-Concepts and Cases. ICFAI University Press. IRMA (2003). “ERP-Systems Impact on Organizations”, See < http://www.irma-international.org/downloads/excerpts/2003/GrantEx.pdf>. James A. O’Brien (2002). Management Information System, 6th ed Tata McGraw Hill. Kenneth C. Laudon and Jane P. Laudon (2002). Management Information System, 6th ed New York: Tata McGraw Hill. Kelkar, A. S (2001). Management Information System, Prentice Hall India. William (2006). The wide world of Wikis. See: www.firstauthor.org/Downloads/Wikis.pdf. Read More