Information Technology Strategic Advantage - Essay Example

IT Strategic Advantage Course Name and Code Institution Name Faculty Name Insert Your Name Insert Your Number Instructor’s Name 28 July 2009 Information technology (IT) is a major component in organization and enterprises all over the world. However, information technology is changing at a faster rate than how it can be utilized and thus many organizations tend to utilize half-baked resources. Thus, the aim of this paper is to analyze service orientation and agile digital platforms in forming an organization that has strategic advantage relative to its competitors and requirements. Service orientation can be defined as a design paradigm that specifically specifies development of automatic logic in the form of services. Thus, service orientation requires effective implementation of strategies for controlling inefficient business processes and the software that brings them together. In the economic perspective, service orientation can be used to trim and reduce costs through outsourcing slices of business operation and software development. This perspective is supported by Nicholas Carr (Carr, 2003) article of May 2003 edition of the Harvard Business Review. Carr (2003) compares the excess of IT to the development of rail lines and electricity utilities thus requiring organizations and businesses to spend less in IT. Hence, it is important for the organization’s management to understand the concepts and have good business arguments before requesting for better software architectures. Hence, services such as insurance utility work and payroll can be outsourced resulting in cost-effective and better quality of services received or accorded. Moreover, introduction of automated treadmill services such as enterprise resource planning (ERP) that is organized in service-oriented way, which also strategically improves the position of the organization that implements. Thus, the service orientation architecture provides a means and clear picture for an organization to make right decisions (Baskerville and Mathiassen 56). Furthermore, the use of service-oriented architecture provides a competitive imperative strategic advantage. If one side of a service-oriented coin is “leaner and meaner”, the other side is the need to compete, attract and retain customers. Many customers require service-oriented aspect in demanding for better and smoother experiences in accomplishment of business requirements. Thus, those companies that apply service orientation in terms of utilizing technology innovatively to improve consumer experience outstands other companies (Bloomberg and Schmelzer 14). Companies that embrace service oriented provide means of multi-channel business process in which a single initiative e.g. online payment can be used to accomplish many tasks providing a visibility sense for the customers to track movement of their requirements. Moreover, the use of service-oriented architecture ensures that companies are specialized and maximizes their competencies allowing the company or organization to gain strategic advantage. Analysis and design is a major factor for IS designers especially when it comes to distributed groups that the global community have come to embrace. One of the major issues is the compatibility of the numerous systems that are involved in the entire process. Different resources within the distributed groups require different architectural and logic considerations. Thus, the IS designers before embarking on developing the resource should understand the requirements and capabilities of all organizations or bodies involved or utilizes the development resource. Moreover, the products and services produced by the different distributed groups should be able to complement each other or there should be no complexities in making the different developed resources to work together. Security is another issue that should be considered by the IS designers. Information and data exchanged should be limited to specific respondents so ensure that strategic advantage or competitors do not know strengths of the organizations forehand. Hence, it requires that the development of the entire process should ensure that security is embroiled with the entire distributed group processes. Thus, appropriate measures should be developed by the IS designers to ensure that security is not compromised (Bloomberg and Schmelzer 16). However, there are number of complications faced by industries or organizations in transforming from IT towards service orientation requirements. Complexity is a major aspect that reduces the chances of organizations dumping IT to move towards service orientation. Many organizations contain many different processes, people and departments that operate differently and at times conflict in the way that duties and operations are accomplished. In fact, this scenario is worse when IT is involved due to ever-increasing complexity in IT, companies have to employ large, multi-skilled teams to design, formulate and implement many layers of IT infrastructure that is accumulated over time through management changes, mergers and acquisitions and numerous individual initiatives and tactics. Many organizations have been used in such complexities and transforming them into service orientation becomes another headache, and minimal chances are there for success if ever employed. Inflexibility is another issue that prevents organizations from embracing service-orientation. It is common scenario that many enterprises have existing technology and processes that are cumbersome or difficult to improve, upgrade and even impractical to replace. There is a mentality in many organizations that “if it works, don’t screw with it”. This is actually true in an environment that there are no changes – stagnant environment and becomes a burden when changes occur preventing occurs from embracing new technologies. Additionally, when organizations try to embrace service orientation, there is the risk of failure and other complications associated with excessive inflexibility and complexity, and all this can be referred as brittleness of organizations. Many organizations may be seen as growing organically over time, an aspect attributed to organizations that are prone to acquisitions and mergers; most of these organizations are tangled together like spaghetti especially due to different technologies and processes. Thus, when circumstances require these organizations to change their status quo, they must either undertake risky improvement projects, expensive or simply stay put and thus no changes in terms of technologies and process, which means that the business will continue to utilize technologies that are obsolete. Thus, this risk is inherent for those organizations that try to shift from IT to service oriented strategies. Designing for digital options provide a means in which an organization can utilize or stop utilizing a component within the development of information technology. Options are the privileges or rights that an organization possesses without specified current obligations for future full investment. The benefit of holding option is ten fold especially when the holder has preferential advantages in maximizing these opportunities as opposed to those that do not hold these options. Holding of options is economically advantageous because of the prior investment, learning and experience of exploiting emergent opportunities. Thus, the use of digital options is the capital of IT enabled inter-organizational and intra-organizational work process for automating and integrating such process to be in better platform relative to competitors. Moreover, digitized knowledge is the information technology repository of knowledge and forms the fundamental systems of interaction among the members of the organization to generate the knowledge that helps in sharing of expertise and perspectives. Other benefits of using digitized options are high reach vs. richness and creation of modular and atomized business processes. Richness can be defined in terms of interactions among members of an organization in terms of sense-making support, sharing of perspectives, and the development of tacit knowledge while high reach defines the association of design and its implementation. However, problems are inherent in the use of digital options in the perspective of originality of organization. This approach can be utilized in an organization that is not agile or are not ready to response to change because of complexities, brittleness and inflexibleness. Nevertheless, analysis, design and implementation of a service orientation are different. A publicly announced methodology for use ion development of service oriented is the IBM SOMA. SOMA covers the broader scope of development of service oriented analysis and design through specification, identification, service components, specification and realization of services and flows that are used for service composes. The analysis and designs brings into consideration the use of component based analysis, traditional object oriented and design methods that supports the requirements of service oriented architecture (Allen and Higgins 7). The implementation of service-oriented strategies requires the use of appropriate tools and run-time infrastructure software. Other factors that play a major role in the implementation of service orientation are management, integration, security, process and modeling. Many service vendors are striving and coming each time with different service oriented products but there should be strategies that will integrate emerging disparate and heterogeneous systems into the single enterprise. However, all these requirements should loosely be coupled, coarse grained and asynchronous services. Generally, service oriented is a strategy that ensures that a company does not concentrate on technologies that do not benefit the organization rather to decrease expenses associated with these process in improving the financial position of the company in terms of profits and ROI. However, converting information technology towards service oriented is usually difficult because of complexities, inflexible and brittleness of the organization. Moreover, compatibility and security measures are some important issues that IS designers should put in place in addressing issues associated with distributed groups. Additionally, understanding the requirements of digital options provides an environment in which an organization that possesses these credentials will sustain in a competitive environment. Moreover, design, analysis and implementation of service oriented require bringing together all resources within the organization to ensure that the entire organization strategic objective is achieved. Work Cited Allen Paul, Sam Higgins and Schlamann Hermann. Service Orientation. London: Cambridge University Press, 2006. Baskerville, Richard and Mathiassen Lars. Business Agility and Information Technology Diffusion, vol. 58. New York: Springer Publishers, 2005. Bloomberg Jason and Schmelzer Ron. Service Orient or be Doomed. New York: John Wiley and Sons Publishers, 2006. Carr, Nicholas. It Doesn’t Matter. Harvard Business Review, May 2003. Read More