The Impact of Information Technologies on Business Process - Case Study Example

Topic: Advanced Business Process Management Summary 1 Introduction 2 Critical Analysis 3 Several advantages of Information technology & Information systems: 5 Several disadvantages of IT & IS: 10 Conclusion 11 Bibliography: 12 Summary In this discussion there is a popular argument that indicates whether Information technology & Information systems have positive or negative impact on business process reengineering project. While making a value judgment on this matter, we will try to make a clear concept regarding IT, IS, Reengineering process & will also find that all of those are closely connected to improve product performance or TQM process. A number of benefits of IT & IS will be found such as collaboration, work site flexibility, management development, employee improvement etc. Although some disadvantages are accomplished with those, significance & usefulness of Information technology & system cannot be avoided in reengineering process. Introduction Our discussion begins with a popular concern today relating the necessity or adversity of information technology & information system in today’s business reengineering process. We already know that, in today’s complex business context Information technology & system are used to improve the quality of products, services or overall organizational performance. Thus, once an organization makes a decision to enhance the quality of products & services, it must then decide how to implement them. This approach of managing quality is TQM or Total Quality Management. Thus, our further discussion will show the impact of IT & IS in business reengineering process while the firm’s main concentration goes to improving its product’s performance. Critical Analysis Before going forth to the argument of positive & negative impact of Information technology & Information system on reengineering process, we should have a clear concept of the key issues those are essential to make a value judgment over the topics. Our given concern has several important issues like Information Technology (IT), Information System (IS), and Business Process Reengineering Project & consequently all those issues turn to the destination of achieving high quality of company’s product. Information is data presented in the way or form that has meaning that means, it has a meaning to the manager & provides a basic for action. So Information technology or IT refers to the resources used by the organization to manage information that it needs in order to carry out its mission. IT may consist of computers, computer network, and telephones; fax machines & other pieces of hardware. IT involves software that facilitates the systems ability to manage information in a way that is useful for the organization. Using this system, company can identify how a given product or product line are selling in number of stores over any meaningful period of time. Information system may be a misnomer. It suggests that there is one system, but in fact a firm’s employees will have different interests, job responsibilities & decision-making requirements. One information system can not accommodate such variety of information requirements. Thus IS is a complex set of several information that share information while serving different levels of the organization, different departments or different organizations. Business process reengineering is a management approach that aims to the improvements of elevating efficiency and effectiveness of the processes exist within and across the organizations. The key motive of BPR (Business Process Reengineering) from a “clean slate” focuses and determines how they can best construct these processes to improve conducting their business. Business Process Redesign, Business Transformation, or Business Process Change Management is other titles of BPR. According to Michael Hammer, as a number of works has been done not adding any value for customers, those works should be eliminated rather than companies should consider their processes because of maximizing customer value. Further, Davenport points out the main distinction between BPR and other methods of organization development or OD, basically the continuous improvement or TQM movement where it has been stated that modern firms must attain a Multiplicative levels of improvement of 10x rather than 10%. Thus, TQM is a real & meaningful effort by an organization to change its whole approach to business in order to make a quality a guiding factor in everything that an organization does. Major ingredients of TQM are as- Although Business Process Reengineering is a close relative that seeks radical rather than merely continuous improvement of a firm, it inserts the efforts of TQM for making process orientation as a strategic tool and a core competence & additionally, BPR concentrates on core processes of business using the specific techniques within the and TQM ”toolboxes” by broadening the project’s vision. After understanding the above conditions, before we can make a decision of positivism or negativism of IT & IS we need to find out both impacts of those. Several advantages of Information technology & Information systems: Fruitful reengineering procedure: In case of changed structural organizational variables, some other ways of accomplishing and performing work has been often considered insufficient. In that case to achieve the benefits fully, the use of Information technology is assumed as a great contributor. Although traditionally it has been used to support the relative existing business operations, now it is using for other fruitful reengineering purpose. Increase collaboration: In BPR, IT is simply considered to maintain a role as enabler of newer organizational forms and collaboration, better than supporting traditional business functions. Collaboration happens not only among the internal but with outside the firm. The network system makes it cheaper & easier to contact with everyone, whether other employees or outside organizations. Aided by internets, reformed companies can learned that complex problems can be solved better by means of collaboration rather than spontaneous interaction, so decisions that that would domain the individuals are now shared, as both people & departments can become more independent. As so much information has been accusable, for evaluation of different perspective, marketing, finance, engineering, & purchasing can share their different store of information & determine an overall best design. Closeness of buyers & suppliers: Organizational buyers & suppliers are becoming so closely networked that they sometimes seem to be working for one organization. In the financial service industry, institutional investors are networked with investment bankers, thus allowing efficient buying & selling of initial stock offerings. Interactive videodisk helps to get instant contact with potential buyers. Collaboration of virtual company: While a company reformats itself, its marketing & promotional skills may team up with firms that are experts in warehousing & distribution, engineering & production. Networking allows collaborators to exchange ideas, plan daily activities, share customer information, & also coordinate their efforts, even if their respective facilities are far apart. Role of Shared database: It makes information available at several places. Role of Expert systems: It allows generalists of performing specialist tasks. Role of Telecommunication network: It allows organizations of becoming centralized and decentralized at the same time. Besides wireless data communication and portable computers allows field personnel of working in office independently. Role of Decision-support tools: It allows decision-making as a part of everybody's job. Role of Automatic identification and tracking: It allows things of telling where they are rather than finding. High performance computation: In the mid 1990’s it allows on-the-fly planning & basically the workflow of management systems were thought as a major contributor of improving process efficiency. Enterprise Resource Planning or ERP vendors like SAP imaged their solutions as movers for business process improvement as well as redesigning. More flexible work sites: Geographic separation of the workplace from the company headquarters is more common than ever because of networked organizations. Once a firm reformed, it should be careful that employees no longer do not work only at the office or the factory, or all the company’s operations performed at one location. Geographically scattered activities can be highly coordinated thanks to a networked system. E-businesses conduct no activities at one centralized location. So all these activities are launched by the customers order & coordinated through the network. Improved management processes: Network systems have changed the very nature of the management process. The activities, methods & procedures of today’s manager differ from those that were common in few years ago. Once upper-level –managers did not concern themselves with all the detailed information considering critical contemporary measures relating performance like cost, quality, service, and speed. Then the question may arise-why? Because it was expensive to gather, slow in coming & quickly out of date. Similarly, workplace management was delegated to middle & first line managers. With information systems, instantaneous information is accusable in a convenient & usable format. Now more & more upper managers use it routinely for planning, leading, directing & controlling operations so that they become successful to prove better performance. By implementing high-tech technology, managers can find out the current status of any customer order, inspect productivity statistics for each workstation, & analyze delivery performance of any driver & vehicle. Also they can identify departments that are working well together & those are creating bottlenecks. Changed employee behavior: Information system also directly affects the behavior of the company that has a significant impact on total quality of product & speediness. Information system usually improves ones efficiency. Some people also enjoy their work more because they have fun using the new technology. Through computerized bulletin boards & e-mail, groups can form across organizational boundary. By having refreshments through work, their workforce ability or interest become increased which may be fruitful to increase production speed. Easiness to use: While a firm decides to introduce high technology in its BPR project, it should not be worried to use them appropriately because IS are in many cases simple to use as one should not have to be a computer expert to use the system. In theory, a manager should be able to access a modern information system by turning on a computer & clicking an icon with a mouse. Better relation with employees: One implementation relates to the span of management & number of levels of the organization. Innovations in information technology enable a manager to stay in touch with an increasingly large number of managers & subordinates. More flexible operations: Electronic network allows business to offer customers greater variety & faster delivery cycle. Products such as cell-phone, PC’s & audio systems can be custom-ordered, too, with your choice, features, & options & next-day delivery. This principle is called “mass customization”. Although a company produces in larger volumes, each unit features the unique variations & options that the customer prefers. Flexible production & fast delivery depend on the integrated network to coordinate all the activities & the ability to organize & store massive volumes of information is crucial, as the electronic linkage between customers, manufacturers, material suppliers & shippers. Several disadvantages of IT & IS: Information systems are expensive & difficult to develop & implement. At a turning point while a firm tries to faster its operational wheel, it will have to cut more cost to install a system in such a piecemeal fashion that its effectiveness suffer. Information systems are not suitable for some task or problems. Complex problem require humans must still address human judgment. Managers sometimes rely too much on this system. Information provided to managers may not be accurate, timely, complete, or relevant that may disrupt productivity & raise cost of production. Managers sometimes have unrealistic expectations about what information systems can accomplish. The information systems & technology can be used for sabotage, & subject to computer virus or downtime. Computerized working arrangements also tend to be much less personal than other methods. Combining all of those factors can disrupt a company’s ability to ensure high quality, less cost & overall better performance oriented products in the reengineering process. Conclusion After evaluating the various aspects of benefits & cost of IT & IS in BPR, we can conclude that in today’s business world a firm must need high-tech technology & system if it wants to cope with the modern techno-based era. While a firm goes through a reengineering process where it needs to envision the new work strategies, actual process design activity, and the successful implementation of the change in all its distinguished technological, organizational versions & mostly human resources, it should have a better cooperation, mutuality, diversity & updated methodology to run in the customers mind as the customers main desire is to get high quality goods & services for which the firm musty introduce the idea of TQM. Although IT & IS have some drawbacks, a company can easily overcome so if it can ensure the proper use of science & that will be helpful to fulfill the major purpose of increasing effectiveness & efficiency of a business. So, the above arguments that are showing a number of advantages of information technology & information system can be presented as a prime catalyst of requiring its necessity in business reengineering process. And additionally it can also be said that in this modern age, it is not possible to avoid the huge usefulness & necessity of Information technology & system in any sort of business activity. Bibliography: Ansari, S. (2000), Business Process Reengineering, McGraw Hill College Division, ISBN-10: 0072420081. Baidoun, S. & Zairi, M. (2003), A proposed model of TQM implementation in the Palestinian context, Routledge Taylor & Francis Group: Bradford, UK. Griffin, R. W. (2006), Management, 8th Edition, Houghton Mifflin Company, Boston New York, ISBN: 0-618-35459x Hammer, M. (1995), The Reengineering Revolution, 1st Edition, Hammer & company, New York, ISBN: 978-0887307362 Hammer, M., and Champy, J. (2001), Reengineering the Corporation, Harper Business, New York, ISBN: 978-0066621128 Johansson, H. J., et.al. (1993), Business Process Reengineering: Break Point Strategies for Market Dominance, John Wiley & Sons, Chichester, UK Malhotra, Y. (2002), Business Process Redesign: An Overview, ICFAI Journal of Operations Management (India), November 2002. Stoner, J. A. F., Freeman, R. E., Gilbert, D. R. (2006), Management, 6th Edition, Prentice-Hall of India Private Limited, ISBN: 81-203-0981-2 Thompson, J. D. (2003), Organizations in Action: Social Science Bases of Administrative Theory, Transaction Pub, ISBN-13: 9780765809919 Taylor, F. W., (2008), The Principles of Scientific Management, ed. Tracy, S. E, Enna Inc. 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