The Impact of Incorporation of Information and Communication Technology in Today's Business Environment - Essay Example

The Impact of Technology in Today’s Business Environment Introduction In the past years, technology has changed greatly and this change has brought about positive improvements in the way business is carried out. Incorporation of information and communication technology (IT) has impacted greatly on the business environment. Ways of doing business have changed and made organizations highly efficient. The improved modes of communication have opened new channels for carrying out business beyond geographical borders (Agnes & Stanislav, 2010). Technology has made positive impacts in the business environment .This is evident from the effect of technology on businesses, as carrying out business is now more effective and more efficient. It has made business transactions faster, allowed collaboration between businesses that are both near and far, reduced barriers that prevent breakthrough into new markets and continues to serve as a source of encouragement for business innovation. The greatest impact has been globalization of business processes and procedures. Organizations can now do business all over the world easily. They can serve clients that are far from them to their satisfaction. All this is due to the impact of technology. Discussion Impact of information technology Information technology has changed the business environment in a major way. While considering the positive impact of IT on business, five core areas are important for consideration. The growth of the internet and the convergence of different technologies, the development of a common economy, emergence of economies based on information and knowledge, the growth of the digital firm and the change in the business initiatives. The internet has improved communication modes by the convergence of different communication methods and made networking between businesses easier. It has also introduced new business models in the fields of entertainment, communication and education such as e-commerce. It has facilitated the shifting of business into new models that are more effective and efficient. Economies based on knowledge and useful information have also emerged and are the future creators of wealth because they are the basis for business innovations and inventions (Pearson Education, 2011). IT has incorporated all business processes together creating a common and very effective communication avenue for businesses between all the involved parties. This has increased the productivity and profitability of the organizations and businesses. The growth of internet is continually enabling businesses conduct trade across borders as efficiently as conducting trade within the business itself. It has also changed the management structure of many businesses. In the traditional business model, the manager relied on formal and rigid plans to run the business. Due to the incorporation of IT into businesses, the manager of the modern business model relies on informal plans and widely established networks to run the business. The manager makes use of the readily available knowledge and insightful information of the employees to ensure the smooth running of the business. The globalization of conducting business is also a result of technology. This has enabled companies to perform certain business activities and processes in other locations in the world where they are done at a lowercost.Thus it is easier to communicate with suppliers and customers, coordinate employees in different geographical regions and respond to business requirements that are either local or international (Jackson, 2009). IT as a transformation tool With the incorporation of technology into businesses, many businesses were greatly transformed into highly efficient and effective business models. This is because organizations are forced to change and shift to other more efficient models by the ever-changing business environment. This has resulted from the shift into the inter-organizational models that have improved their performance. Many companies have adopted the use of computers in carrying out their normal business processes and activities (Wielki, n.d.). This involves the use of such technologies as software and severs that centralize all the business processes. Some have effectively been used in collection and analysis of data. The process is now easier and faster compared to traditional business models that involved manual collection and analysis of data. Some software are used to assess the productivity of individual employees in an organization and this gives the employees motivation to work harder. Many managers have chosen to apply certain technological tools to make their firms effective and efficient (Hengst & Henk, 2001). Advantages of technology IT offers several advantages when incorporated into businesses. Business process (BP) brings about positive adjustments in business activities and other processes. It increases the availability of information that give way for the improvement of the systems that are applied in the business. It is effectively applied in BP in designing a system that will fit in well with the model of the business. It helps in overcoming the problem of simulating the system. Designing a computer model and an appropriate business model at the same time improves the ease with which the information is exchanged between the two models. This enhances the application of IT in business processes (Buttler, 2008). There is also ease of communication between the employees, company suppliers and the customers. This makes the work of the employees easy and flexible. The business design makes available to the employees easy to use software that improve the communication between them and the businesses royal customers. Consequently, this increases productivity and raises the profits accrued. With the use of IT in enhancing business processes, several benefits are seen. The customers can easily send their order information to the businesses and the employees can send response as easily. This reduces the number of complaints sent by the customers regarding the delay of their orders. The company is also able to keep records of the customer orders that are readily available to all departments involved in the products that are requested by customers. With such ease of communication, the products that are ordered are distributed to the respective customers immediately. The processing of invoices for the customers is easier because IT has made sharing information faster and easier. In traditional business models that did not use IT, sharing of information was through papers that resulted in time wastage due to the required duplication of the information. In addition, IT reduces the time required for data to be collected, analyzed and shared in a business. This has been made possible through the design of business models that incorporate all the stages through the use of IT (Eatock et al,n.d). How IT increases productivity Information and communication technology increases the productivity of organizations by enabling them reduce the costs involved and increase their capabilities. As such, organizations become more profitable. The use of computer technology reduces the costs incurred in communication. In traditional business models, communication was through letters and landline telephone connections that were both slow and expensive. With the advent of mobile phones and the internet, communication is cheaper and faster. Instead of letters organizations use electronic mails and short message services that are provided by telecommunication companies (Agnes & Stanislav, 2011). This new technology has been fully accepted by customers because of its efficiency. It is both cheap and fast. Organizations are able to provide their services and goods to the customers’ satisfaction. This is due to faster response to customer orders and other requests. However, these technological advancements reduce productivity in some organizations where they are misused. The use of the internet, electronic mail and programs such as instant messaging, chat rooms and blogs decrease the productivity of employees who spend too much time using them. They reduce productivity if they are used during work hours to gain access to information by either receiving or sending information that is not directly associated with the operations of the organization (Davenport, 2002). Technology increases the level of productivity of employees if properly utilized. This has been observed in some Asian countries where technology has helped create employment and reduced cases of unemployment. The internet offers many employment opportunities in form of jobs and business ventures. This has led to the considerable decrease in the number of unemployed\ people. The greatest advantage of online businesses is that they are easier to start and run than other businesses that are not online. Online jobs are less stressing because of the elimination of the need to travel and deal with the organization’s management face to face. The internet makes running of several businesses at the same time easier because of reduced running costs and the elimination of the need to travel to the site of the business. It does not need many employees and managing them is easy (Katos, 2010). Conclusion From the above discussion, it is clear why technology has a positive impact on the business environment. It improves communication, encourages business innovation, and makes business collaboration easier. It also globalizes business operations and processes and this gives organizations a couple of options to choose from. Though it has some disadvantages that work against the effectiveness and efficiency of organizations, its advantages override the disadvantages. The advantages are more than the disadvantages. Technology has an impact on the business environment both internally and externally, the customers and the competitors. For organizations that want to improve their productivity and efficiency, embracing technology fully is important. Further advancements in technology will change the business environment continually and it is important for businesses to adapt to the changes otherwise they will be pushed out of business due to the heightened competition. References Agnes, M., Stanislav, I. The impact of enterprise 2.0 tools on innovation process: the case study of incentive at IBS. Retrieved from http://www.essays.se/essay/450f9016c6/r” Pearson Education. (2011). Business information systems in your career. Retrieved on 21 November,2011 from http//wps.prenhall.com/wps/media/objects/5528/5661380/_learningtracks/lau don_ch01_lt2. pdf Butler, M. (2008). Future impact of Technology on Business. Retrieved 21 November 2011from http://www.itshownamibia.com/speeches/files/keynote%202.pdf Davenport, H. T. (2002). The new Reengineering Retrieved from http://www.darwinmag.com/read/090102/order/html Hengst, M.D. & Henk, S. G. (2001). The Impact of Information and Communication Technology on Interorganizational Coordination: Guidelines from Theory. Volume 4 No 3, 2001, Retrieved 21 November, 2011 from http://inform.nu/Articles/vol4/v4n4p129-138.pdf Jackson, A. (2009). ICT and the new global investment paradigm: Challenges to cross-border Trade and investment. World Customs Journal, 3(1), 55-61. Katos, A.V. (2010).The influence of Information and Communication Technologies on EnablingTrade: A Cross-Country Investigation. Vol. 10, No. 1, pp. 15-24, 2010, Retrieved 21 November, 2011 from http://www.jiti.com/v10/jiti.v10n1.015-024.pdf Wielki, J. (n.d). The impact of internet technology utilizations on companies internal work environments: the social and ethical implications. Retrieved from http://bibliotecavirtual.clacso.org.ar/ar/libros/raec/ethicomp5/docs/htm_papers/66Wielki, %20Janusz.htm Read More