The Role of the Information Technology in the Organization - Research Paper Example

The Role of the Information Technology in the Organization Abstract Information technology (IT) normally refers to the use of business applications of computer technology. IT is a product of linkage of communication and media devices to people, i.e. organizational employees. Information systems are composed of a variety of software programs and databases. Information technology spans the enterprise level and is designed to manage and control all the necessary functions within an organization. Information technology forms an integral component of every business plan. Information systems are applied at all business sizes, i.e. from multinational corporations to small businesses. Some of the roles played by information technology in organizational development include productivity enhancement, improvement in profitability, cost reduction, inventory management and establishment of a competitive advantage. Table of Contents The Role of the Information Technology in the Organization 1 Abstract 1 Table of Contents 2 The Role of the Information Technology in the Organization 2 MANAGEMENT ROLE 4 DOWNSIDES OF INFORMATION TECHNOLOGY 9 RECOMMENDATIONS 9 CONCLUSION 10 MacKechnie, Chris. “Information Technology & Its Role in the Modern Organization.” The chronicles. Web. Nov. 13, 2012. 11 The Role of the Information Technology in the Organization Information technology (IT) is made up of a wide array of communication and media devices that link information systems and people. Information systems encompass software programs and databases. Such technologies include voicemail, video conferencing and e-mail among others. IT consists of all forms of technicalities used to create, store, utilize and exchange information in various forms. The process entails processing, acquiring, storing and distributing information. It also includes manipulation, distribution and processing of information. Information has formed the perfect replacement of the conventional methods of information dissemination at an organizational level. The innovative technological tools that have been brought in the organizational management through current technology include e-commerce and computers. Information technology is viewed as the most convenient and effective factor for performance improvement in the business world. Technology allows organizations to work more efficiently and improve their productivity. Most organizations have fully become dependent on information systems for performing their functions. The benefits accrued from IT are extremely crucial in the uplifting the economic and the social aspects of an organization. IT simplifies and enhances the efficiency of organizational information. The paper below is a review of the role of information systems in impacting organizational outcomes and characteristics. Communication. The most prominent role of information systems in an organizational setting is communication. Information devices act as a medium of verbal interaction between employees, staff and suppliers (MacKechnie par. 1). Communication role of information technology is largely a product of the Internet whereby the organizational workforce interacts and communicates through e-mail. However, the recent advancement in information dissemination has led to the application of live chat systems and video conferencing systems. Efficient communication ensures that the necessary information is shared among employees as well as external stakeholders. Marketing is also enhanced through the application of information systems whereby the geographical barrier has been eliminated. Organizational Role. Most organizations are currently undergoing complex transformation. Many industries are changing the culture of mass production through large, vertically-integrated and hierarchically-organized production forms into flexible forms of both internal and external organization. Success is commonly accomplished through the focus on small organizational groups that are bonded through information sharing. Information technology forms an integral component of every business plan. Information systems are applied at all business sizes, i.e. from multinational corporations to small businesses. IT plays a prominent influential role in structures and organizational processes. Such processes include centralization and decentralization, simplifying the complexity of the organizational structure and precise description of duties and roles (Mousavi and BadrAbady 56). The methods of implementation of affairs are largely a factor of technical progression. Most organizations have adopted the culture of computerizing in almost all business functions. Information technology positions an organization for the establishment of a competitive advantage through product and service distinction. Application of information technology in organization management improves relationships with providers; enhances efficiency of the marketing chain, development of improved commodities and services, and improvement in awareness of company products through promotion of its trademark. Application of IT ensures fulfillment of customer satisfaction, establishment of new markets for improved products; enhances innovation, devising new distribution channels, and creation of relationships with partners. MANAGEMENT ROLE IT allows effective use of stored data. Most organizations use the information in strategic planning process and tactical execution of the business roles. The role of management information systems is applied in tracking data related to sales, expenses and productivity. The information can be used to analyze profitability overtime, improve the return on investment and identify the organizational segments that require improvement. The management is able to track changes regularly and respond to unhealthy situations that may lead to business collapse. This boosts productivity and reduces operational costs. Inventory Management. Organizations have an obligation of maintaining the required stock that is sufficient to cater for the changing demand. IT information helps the organizational management to track stock changes of various commodities under their business dealings (MacKechnie par. 2). This triggers orders on additional stock in case the quantity is below the pre-determined amounts. The IT connects the inventory management to the point-of-sale (POS) system that regulates the quantity of various commodities. The POS system records the excesses and deficits. Data Management. The traditional mode of information management that involved large file rooms and cabinets to store information paperwork for distribution are currently outdated (MacKechnie par. 3). Most organizations have replaced the manual filing systems with digital versions of information in servers and storage systems. Documents containing digital information are made accessible to all concerned parties regardless of their geographic conditions. IT enhances data storage where organizations are able to store chunky amount of information that accommodates immediate access from all employees. Data from the field is converted into knowledge and technology by information systems. This enhances issue recognition, recognition of strategies to problem solving and transformation of an experimental method for process improvement. Sharing of knowledge among the workforce enhances team work and staff encouragement in role play. Employees and consumers use the electronic sources and the Internet to outsource information related to commodity changes and follow-up of online transactions. Knowledge Management. Information systems contain valuable information that is paramount to the creation of a knowledge creator system (Mousavi and BadrAbady 57). Information systems improve organizational learning; create knowledge processes and establishment of a favorable environment for knowledge acquisition. Information technology facilitates information exchange among trade processes and units. Any misinformation or errors that may characterize the communicated information is identified and rectified through reference to feedback from respondents. The information can therefore be transformed from unofficial to official or coded information. Increased interrelation between the work force, procedures and technologies enhances the efficacy of an organization. Linking and Improving the Efficiency of the Employees. IT increases the overall amount of information in an organization. This links and enables employees in both factions of various departments within an organization. IT assists in cross-cultural workflow, stockless production and concurrent engineering (Dewett and Jones 321). Technological interdependence provides the accessibility of critical information for all employees, thus hastening the act of problem-solving. The information contained in the IT enables organizational management to explore new modes of structuring their work force to improve productivity. Information sharing improves employees’ self esteem, being identified with the organization, earning respect from others and instilling a feeling of commitment upon the organization. Additionally, employees are highly motivated because they possess a sense of organizational citizenship to the organization. Cost Reduction. The key metric in the application of information systems in business management is the reduction in the cost of business operations. Application of the IT has been linked with the urge of businesses to reduce the operating costs. Effectiveness in business can only be achieved if the organizations curtail their operational costs and derive profits from their various technological equipments used in the improvement of productivity. Customer Service Perfection. Increased efficiency requires improved human resource that can efficiently cater for the welfare of the employees. Efficiency in the human resource is effected by the reduction in the tax complexity, a role that is efficiently performed by computerization. According to MacKechnie (2012), most organizations are also applying IT to improve their mode of management and design customer relationships. The information systems store the entire customer past experiences with the company for offering more enriching service delivery. The organization is able to apply the information systems in understanding the challenges that customers may be facing and device appropriate strategies necessary for dealing with the concerned issues. The entire conversation and information exchange is stored in the storage devices for future reference. This implies that customers are served better and attracted to transact more with the business; it improves productivity of the organization. IT Codifies the Knowledge Base. The human capacity of acting as a component of organizational memory is imperfect because the human brain is subject to erosion and error. IT has largely facilitated the level of organizational memory and the capability to replicate explicit knowledge about an organization. This makes information easy to codify, share, assimilate, store and retrieve. This enables the organizational management to refer to the past experiences and derive information required for improving the current state of affairs. IT Increases Boundary Spanning. IT provides the organization with substantial information utilities and efficiencies (Debaser and Veugelers 336). The employee is provided with an opportunity to access quality information and absorb that is relevant for solving certain problems. For instance, the access to information from other departments or branches is carried out through searching network information. Network search saves time and energy related to manual information search. It also allows quicker access to both internal and external information related to the respective industry environments. Access to a wide variety of information allows expedient decision making. IT Enhances Efficiency. IT creates the necessary conditions suitable for communicating easily and less expensively. Information technology promotes precision and rapid communication to the targeted groups. Information technology creates an efficient environment that enhances creation of the capability to record and index situations more reliably and inexpensively on organizational events. IT enhances selective control of participation to various events and networks. Information systems such as computers can be used in reconfiguration and modification of information to suit the development roles and targets of an organization. Additionally, the management can apply information systems to access expert judgment and decision models. Business transactions and dealings are recorded and retrieved through use of information systems. Innovation. The innovative role of the IT is found in its ability to moderate the many processes involved in harnessing the practicality of problem-solving ideas (Debaser and Veugelers 330). This is visible in the mode in which information is stored, transmitted, communicated, processed and acted upon. The information systems possess the required knowledge base that the employees derive inferences from when conducting a problem solving exercise. DOWNSIDES OF INFORMATION TECHNOLOGY The most prominent negative impact is the loss of employment opportunities due to the replacement of manual labor with technological devices. The IT role as a link to business functions and process does not imply that only constructive information is disseminated. Employee linkage may also lead to inclusion of other characters that are not like-minded, i.e. do not share the common vision. This may deter the development strategies of the organization. Help seekers may not be provided with adequate linkages to the information providers as IT is a product of a combination of people with diverse capabilities. Excessive storage of information may lead to information overload. The scrutiny of large amounts of information may impede the managers’ role of providing timely decisions. RECOMMENDATIONS Organization management is obligated to ensure that the information provided through the information systems is accurate, i.e. geared towards enhancing organizational development. The management should establish online communities composed of experts from various field of profession that provides adequate information for both internal and external information seekers. Sometimes, the information provided in the information systems is not detailed enough to provide the required details on the issues affecting employees. For instance, most of the information on research is normally written in summary form or any other way that suits the needs of the researchers. The leaders should actively screen and scrutinize the process on information management to guarantee proper size and utility of data repositories. The knowledge of the availability of information alone is not enough to enhance innovation. Creation of innovation and competitive advantage is a product of creative application of knowledge and information. CONCLUSION Some of the roles played by information technology in organizational development include productivity enhancement, improvement in profitability, cost reduction, inventory management and establishment of a competitive advantage. The stipulated roles are achieved through maintaining of data flow, tracking processes and storage of the employee records. Information makes it possible for organizations to operate effectively and efficiently with minimal manpower. This curtails the operation costs. Information systems keeps an organization connected to suppliers, employees, customers and sales people. The ability of the technological advancements to streamline the operating cost makes an organizational stand a better chance offering affordable pricing of goods and services without lowering the quality. Low pricing and high quality create a competitive advantage. Works Cited Debaser, Koenraad, and Reinhilde Veugelers. “The role of academic technology transfer organizations in improving industry science links.” Research Policy, 34.3 (April 2005): 321–342. Print. Dewett ,Todd, and Gareth R. Jones. The role of information technology in the organization: a review, model, and assessment. Journal of Management 27 (2001): 313–346. Print. MacKechnie, Chris. “Information Technology & Its Role in the Modern Organization.” The chronicles. Web. Nov. 13, 2012. Mousavi, S.S., and M. Habiby BadrAbady. The Role of Information Technology in Organizational Procedures ' Improvement with Knowledge Based Approach-A Study of the Iranian Taxation Affairs Organization. World Applied Sciences Journal 3 (Supple 2) (2008):55-66. Print. Read More