Information Systems in Business - Woolworth - Case Study Example

Running Head: Information Systems Information Systems in Business Student’s Name: Professor’s Name: Subject Code and Name: Date Submitted: Executive Summary The purpose of this report is to show the relationship between IS in relation to Woolworth’s business decision making for competitive advantage and to make recommendations for the improvements required. It was found that 80 per cent of the employees interviewed including the senior manager stated that the core reason for the company in using IS was to aid in strategic decision making. Only 20 per cent were of the opinion that IS aided Woolworths in automation and 40 per cent stated that it was used in informating. The results show that only 20 per cent of the employees felt that IS had ‘some competitve advantage’ to the company while 45 per cent stated that IS had ‘moderate competitive advantage’ to the company. The most outstanding response was that of ‘significant competitive advantage’ to the company which had 80 per cent contribution. Table of Contents Executive Summary……………………………………………………………………….2 Introduction……………………………………………………………………………….4 Literature Review…………………………………………………………………………5 Methodology………………………………………………………………………………7 Research Findings………………………………………………………………………….8 Analysis…………………………………………………………………………………….9 Recommendation…………………………………………………………………………..12 Conclusion…………………………………………………………………………………13 References…………………………………………………………………………………..14 Appendix……………………………………………………………………………………15 List of Figures Figure 1………………………………………………………………………………….9 Figure 2………………………………………………………………………………….9 Figure 3…………………………………………………………………………………11 Figure 4…………………………………………………………………………………12 Information Systems in Business Introduction Information systems is concerned with strategic and managerial discipline involved with information distribution (Zahra, 2002). Several business organizations have come to the realization that computerized databases make up the most crucial assets and that they require professional management. Such businesses have also appreciated the fact that accurate data as well as consistency is vital and have thus come up with company systems as well as architectures for data. Such are extremely high level models which make a description of the major processes an organization participates in and the main entities need in supporting these processes of business. Purpose of the Report The purpose of this report is to show the relationship between IS in relation to Woolworths Limited business decision making for competitive advantage and to make recommendations for the improvements required. Objectives of the Report The following will be objectives of the report: To find out how IS assists Woolworths in undertaking their decisions. To establish the way in which IS could be enhanced in Woolworths in order to improve the current processes in decision making. To determine the future directions that Woolworths can take part in while using IS. To establish the leverage of Woolworths in order to determine its competitive advantage by effective decision making. To investigate the areas in Woolworths where changes to the management of information could be further used in enhancing decision making of the business. Literature Review There are three major uses of IS which are: the provision of support to finish a task faster, cheaply, as well as with great accuracy; provide support to enhance everyday operations by acquiring, transferring, and creating knowledge; offering support that aids the firm in gaining competitive advantage over its competitors.Information systems in business aid the management or the owner of the business in solving unstructured problems. Strategic decisions are the vital decisions that demand a large portion of resources of the business and considerations of the environment (Weigelt, 2009). This is because strategic decisions affect the organization they are taken and also the entire society. Strategic Level Systems thus refer to information systems present at the strategic level of a given organization, and made with the aim of addressing unstructured making of decisions by use of effective communication. Additionally, Information Systems aid the business in addressing and tackling strategic issues as well as long-term tendencies within the business as well as the external environment. They provide support to planning sessions of senior management of organizations and businesses and help in forecast and control of activities. Information Science helps in the creation of creation of communications and computing environments which can further be applied and focused to a variety of problems that change by the combination of data from internal as well as external sources (Weigelt, 2009). Advances in technology will precipitate a great shift in the business operations of global firms, particularly with regard to the role of logistics. As global firms and businesses struggle to attain a competitive advantage in the market, new distribution systems will emerge. Businesses and firms have been looking for new logistics and production architectures as a way of gaining the competitive advantage that come with global production and new technology. Advances in technology affect several aspects of any business activities, especially when it comes to Information and Communication technologies. Notably, the unclear material aspects of the firm’s behavior and the subsequent changes in the meaning of geography and distance (Zahra, 2002). These changes may have an impact on those firms whose activities are carried out over distance, particularly transnational corporations (TNCs). Distance, economic, geographic, cultural, economic, and political factors have been fundamental challenges facing such organizations. This has also influence the manner in which they are managed and organized. The possibility of eliminating the importance of distance, especially geographic distance, and thus the value of physical location, as a result of technological advances, has major implications for such firms. It allows them to gain access to remote resources and other customers and firms, and interact with them electronically, without regard to the physical location of the individuals involved. Methodology Method of Data Collection In order to address the purpose of this report, the researcher relied on primary sources of data. This kind of data was collected from interviews involving the senior manager of the IS department and three employees. The selected interviewees had a solid background knowledge and experience of how IS influenced the business in making decisions as well as giving it competitive advantage. Method of Data Analysis Data analysis is examining of what has been collected in a survey or experiment and making deductions and inferences. It involves transforming observations gathered in the field into categories, and then translating these categories to qualitative and quantitative analysis. The data that was collected using the above methods were subjected to both descriptive and inferential statistical analysis. Research Findings It was found that 80 per cent of the employees interviewed including the senior manager stated that the core reason for the company in using IS was to aid in strategic decision making. Only 20 per cent were of the opinion that IS aided Woolworths in automation and 40 per cent stated that it was used in informating. This is well demonstrated in figure 1 below. Figure 1: Reasons for using IS in Woolworths Limited Figure 2: Opinion on the contribution of IS to competitve advantage of the business The figure above demonstrates the importance of IS in the contribution of competitve advantage to the company. The results show that only 20 per cent of the employees felt that IS had ‘some competitive advantage’ to the company while 45 per cent stated that IS had ‘moderate competitive advantage’ to the company. The most outstanding response was that of ‘significant competitive advantage’ to the company which had 80 per cent contribution. Analysis According to the results, it was found that the main advantage of IS to Woolworths is that it aids in the making of strategic decisions. The others included automation and informating. Automation refers to the provision of support in order to complete a task faster, and in a cheaper and more accurate manner. The main styles of processing include manual processing, fully automated, and technology supported processing. On the other hand, organizational learning or informating is used in offering support to improve the daily operations by obtaining, creating, and transferring of knowledge. Strategizing is also another use of IS and it can provide support in a manner that allows the firm to sustain or gain competitive advantage over competitors. The sources of competitive advantage include the brand name of the company, the good quality products it deals with, a high technological information system, and pricing which is lower than that of its competitors. The other role of IS in competitive advantage is that it has a role to play in the Value Chain Analysis of the company and also in the technology strategy fit. Value chain analysis is doing analysis of organizational activities to know the addition of value to products and costs involved n achieving the same (Livi, 2008). An additional factor of IS in business of Woolworths Limited is to secure information that is sensitive as well as ensure efficient storage for easy retrieval. Moreover, IS makes sure that there is quality control of information that can be easily presented and understood by the audience. It also ensures that data gathering and data processing is carried out in an effective and reliable manner. Figure 3: Value Chain and Uses of IS in value addition Source: (Livi, 2008) The results demonstrate the significant contributions of IS to Woolworths Limited. These include competitive advantage and making of strategic decisions. These two factors are vital for the success of any profit making organization because they can aid the organization in having an upper-hand against their competitors in the same industry. Hence, the company can go through a learning experience in order to find out where to enhance its IS capacity with the aim of being a strong competitor in the industry. The learning experience of the organization can be explained by the idea of the absorptive capacity of the organization (Zahra, 2002). This is the capability of Woolworths Limited to be dynamic as well as innovative. Moreover, it defines its ability to value and identify, carry out exploitation as well as external information for commercial use. The absorptive capacity of the company will also be dependent on the source of knowledge as well as the existing knowledge and its impact on innovative performance. For the company to recognize absorptive capacity as a source of dynamic capability, it will allow it to explore the various opportunities that IS presents. Figure 4: The absorptive capacity model of Zahra and George (2002). The external and internal triggers will make Woolworths Limited to utilize its effort in seeking external knowledge. Additionally, the social integration mechanism is important in the company because there are barriers that are present in the company and they prevent the sharing of knowledge and its exploitation. Moreover, the appropriability regime is the dynamics of the retail industry affecting Woolworths’s capability in protecting the advantages of services which are new. Conclusion The purpose of this report was to show the relationship between IS in relation to Woolworths Limited’s business decision making for competitive advantage and to make recommendations for the improvements required. The objective of the report was to find out how IS assists Woolworths in undertaking their decisions, to establish the way in which IS could be enhanced in Woolworths in order to improve the current processes in decision making, to determine the future directions that Woolworths can take part in while using IS, to establish the leverage of Woolworths in order to determine its competitive advantage by effective decision making and finally, to investigate the areas in Woolworths where changes to the management of information could be further used in enhancing decision making of the business. In order to address the purpose of this report, the researcher relied on primary sources of data. This kind of data was collected from interviews involving the senior manager of the IS department and three employees. Data analysis was examined by the generation of graphs according to the results of the interviews. 80 per cent of the employees interviewed including the senior manager stated that the core reason for the company in using IS was to aid in strategic decision making. Only 20 per cent were of the opinion that IS aided Woolworths in automation and 40 per cent stated that it was used in informating. The results show that only 20 per cent of the employees felt that IS had ‘some competitve advantage’ to the company while 45 per cent stated that IS had ‘moderate competitive advantage’ to the company. The most outstanding response was that of ‘significant competitive advantage’ to the company which had 80 per cent contribution. Information systems is referred to as academic and professional discipline that is concerned with the managerial, strategic, as well as operational activities involved with information distribution. Information systems in business aid the management or the owner of the business in solving unstructured problems. Recommendations Since Woolworths Limited is present in the retail industry, it should upgrade its website using the latest software and advertise its products and services to prospective customers. There is limited research carried out in this field hence, further research should be done in order to tackle issues to do with the relationship between strategic decisions and IS as well as competitive advantage. Bibliographies Zahra, S. A., & George, G. 2002. Absorptive Capacity; A review, reconceptualization, and extension. Academy of Management Review, 27(2), 185-203. Weigelt, C. (2009). The Impact Of Outsourcing New Technologies On Integrative Capabilities And . Performance. Strategic Management Journal, 30(6), pp. 595 Livi, E. (2008). Information Technology and New Business Models in the Tourism Industry. 8th Global Conference on Business and Economics. Appendix a. Interview Questions The following are the sample questions that were used for interviewing the senior manager in IS department and four other employees: 1. What are the uses of IS in your company? 2. What is the major use of IS in your company? 3. What do you think are the advantages of IS in Woolworths? 4. Do you think competitive advantage is linked to IS? 5. What is your opinion concerning IS and strategic decision for the company? b. Type of Competitive Advantage pursued by the company c. Value chain of Woolworths Limited Read More