Designing Effective Organization - Research Paper Example

Use of Internet in designing effective organization Introduction Technological innovation has driven organizational change that has resulted in increased effectiveness and efficiency. This dates back to the substitution of machines for manual labor. Considering the recent developments in technology, internet has driven organizational success to much higher level. The major factor that led to the adoption of internet in various organizations and at all levels is the speed of communication and workflow. Earlier ordering stock quotes and requisitions would take as much as five to seven days in processing. Now with the use of internet getting stock quotes, sending mail, updating stocks, receiving and resolving complaints, etc are done in less than a minute. Rather it takes few seconds to draft a mail, get real time updates on employee performance, fetching financial information, etc. It has led to process automation. In other words it has become the most important resource in an organization. In the advent of globalization where organizations conduct business across a host of nations either through transnational or multinational entity, internet has become the most critical resource. Trade facilitation would not have been much effective had there been no internet. This has not only led to expedition of business processes, but it has simultaneously reduced the cost of operations. Organizations only incur the initial cost of setting up the process, but the long run cost of business is significantly reduced. Earlier organizations would incur significant printing charges, postal charges, high manpower cost, etc which has been almost reduced to zero or has become negligible after the implementation of internet. Relevance of internet in designing effective organizations With growing competition, organizations want to enjoy competitive advantage and be on the top. This requires it to reduce its cost in order to earn higher profits. Internet has led the technological innovation in businesses around the globe. Organizational effectiveness and efficiency refers to the achievement of targets and objectives in less time and with optimum utilization of resources. Resources are limited and cannot be utilized in full capacity to meet strategic organizational goals. To ensure business sustainability, internet has become the most critical medium why organizations use it to run its business operations. It has become the most innovative medium through which information is communicated. It refers to the transmission of information and communication through electronic channel. Data and information has become the medium of exchange and might replace money in the future for conducting business transaction. Thus, internet has become an irreplaceable asset that aids in supplementing organizational effectiveness. It primarily supports the organization in three ways that leads to its effectiveness and efficiency. It offers speed, volume and cost advantage to organizations. These are the three important factors that will drive organizational success. It processes information in a few seconds to organizations stakeholders. Information if processed to the right person at the right time will lead to operational efficiency that is leveraged by organizations to become successful. Through internet organizations can communicate with its customers, suppliers, shareholders, external regulatory authorities, etc in real time. Earlier information on dividends paid to shareholders and payment of dividends would take substantial time, which includes the time of sending the cheque through post offices and courier services. With the use of internet organizations can share information and transfer dividends directly to the bank accounts of its shareholders in a matter of few seconds. It has led to faster processing of customer orders. Internet has led to the integration of the supply chain which helps organizations process information from the customers to its suppliers in real time. Earlier this process would take substantial time leading to delayed decision making. Earlier organizations would incur high cost in processing and sending large volume of information to its vendors, customers, regulatory authorities, etc. Now it can send large volume of data to its stakeholders at reduced cost. There is no documentation, storage and maintenance cost. Digital copies have zero cost as it does not require physical paper and ink. Organizations save space as earlier there were large files where financial records were kept. Now the same data can be saved in digital storage spaces called cloud storage which can be retrieved at any time. It ensures effective decision making as it facilitates the flow of information to the management in a few seconds. Internet has reduced the use of human capital, unlike where organizations would employ people to prepare such data and update it on a regular process. It now does the same work with less manpower as literally the entire work is automated (Sudweeks and Romm, 2012). Key requirements in implementing internet in organizations Implementing internet in organizations require physical and non physical resources. Successful implementation would require a blend of physical and human resources. Internet requires a platform that will be used as an input and output device to feed and fetch information that is critical for effective decision making. It cannot fetch data and information on its own. It requires an external source from which the data will be fed and it will effectively interpret and transmit it to the related entities in an organization that require that information. Thus, human capital is also another critical factor in implementing internet in organization. Though it requires less manpower, it still requires it in order to feed the relevant information. Internet requires less people and cost in transferring information but the requirement of information by organizations is not affected. Organizations are managed by people who require information to manage the business operations and take decisions that will add to the effectiveness. People in an organization who uses internet for sharing and communicating information at various levels require professional expertise and special skill set. High networking and computer knowledge is a pre requisite in the implementation of the tool. Organizations should ensure and assess the training needs of its employee so that they can effectively use internet to communicate and share information. The physical components that are required to implement internet in organization are computer machines, servers, computer peripherals, etc. These are the input and output devices that are used in feeding data and information which are transmitted through the internet for consumption by various stakeholders of an organization. Implementing internet in organizations also require a technical team that will resolve any internet related issues. This team comprises members who have professional expertise in the domain and offer technical support to the organization in cases where there are network disruptions hindering the operational flow. Organizations should also ensure that the tool is not misused by any of its employees that will lead to consequences affecting its sustainability. It should also ensure data protection and prevent data and information theft. Proper security measures should be implemented that will secure the data which might be readily available to all the stakeholders. Effective access should be granted to the employees; else it will lead to data and information redundancy which will hinder organizational effectiveness (Sudweeks and Romm, 2012). Organizational change or restructuring as a result of implementing this topic Internet applications can be considered to be a tool that enhances organizational performance. Organizations in earlier years were totally dependent on manual labor but through utilizing this application firms can gain competitive edge. Competition is one of the vital elements which have facilitated growth of Internet. Technological advancements have led to organizational growth and less of human error. Organizations before implementation of this topic were dependent on human resource. Strategies were implemented by firms in order to acquire best talent within organizational system. On the contrary, Internet or Intranet applications will provide a medium to firms whereby they can directly access data without any manual help. Organizational change is bound to happen with the introduction of this technological tool. This is simply because new features of the application will be incorporated which needs to be well understood by employees. It can be stated that earlier firms were inclined towards training employees on basic functions but in later phase focus would shift towards technical training of employees. Team members should be aware about technical intricacies associated with Internet applications so as to ensure maximum utilization of resources. Organizational change will be observed in context of continuous training and development programs of employees. This change shall have positive implications on the system because employees can put across their queries through such training programs. To be more precise it is a procedure by which employees can be aligned with common goals or interests. Organizational restructuring would also occur in the form of elimination of human capital and more focus on technical equipments. Internet shall be able to reduce manual work along with probable human error. Reduction in workforce will prove to be a major organizational restructuring process. In earlier years more importance was given to development of employees, where proper training programs were designed along with reward management and performance appraisal schemes. However growth of Internet applications will lead to less investment in human resource management and more funds allocated towards technology based applications. Organizational restructuring shall be prominent in relation to management of files, information, etc. It is clearly evident that information will be more efficiently managed through these applications instead of involving human resource. Employees being recruited will be reduced so as to shift fund allocation towards other operations. Internet usage will also result into centralized decision making approach. In earlier times information was department specific and on being communicated often got adversely affected. Internet will support cloud computing approach where team members can access data as and when required without resulting into any form of misinterpretation. Apart from data accessibility, there can even be some negative impacts of organizational restructuring like greater dependency on Internet in comparison to management. Before incorporation of Internet application, face to face interaction was relatively more which prevented a lot of misunderstandings but organizational change shall provide a medium that can initiate team conflict. In overall context, organization will change in terms of efficiency, less of human error, centralized structure, rapid data accessibility, dealings in large volume of data, etc. Past successes or failures implementing internet in organizations Organizations across the world have potentially benefited from the implementation of the internet in many ways but at the same it has been subject to failures. Though the pros of the implementation significantly outweigh the cons, still organizations should consider the impact of the implementation of internet. The cost benefit trade off is high in the implementation of the tool. Organizations in the past have successfully implemented internet to increase its effectiveness. Various business sectors have grown exponentially and enjoy competitive advantage. The retail sector in particular has enjoyed increased efficiency after the implementation of the internet. Internet has led to the integration of supply chain in the retail industry. All the stakeholders in the supply chain are integrated through the internet which facilitates information sharing in real time. Earlier there was a long waiting time for the customers as orders were made physically through post. Retailers had to maintain high inventory that led to increased cost. Market externalities also affected the flow of inventory. Through the use of internet the retailing landscape has totally changed. It has become online and is known as E-tailing. Retailers now through integrated supply chain do not require maintaining high volume of inventory. Internet has made shopping experience of the customers much more convenient. Businesses now enjoy lower cost of advertisement as the printing cost of fliers and various other promotional banners are eliminated and it was mailed to the customers through the internet. Despite the success of implementing internet in organization, it also led to failure. During the emergence of the IT sector, many organizations laid off its workforce. Internet implementation requires high level of knowledge and skills. During such transformation there was a dearth of institutions that would train and develop the skills of the employees. The workforce then was also aging that coupled with the problem of the training needs. The technological change i.e. implementation of internet was not favored by many as they were not capable of adapting to the new technology and age was also another factor. This led to organizations offering voluntary retirement services to its aged employees. The use of such technology was aimed at increasing the workforce productivity, but the implementation sparked repercussions in the workforce supply in the short run. Organizations were left with less people and the work load increased. This reduced the overall productivity of the organizations. The information technology sector was characterized by a large workforce gap that led to major US companies to outsource work from emerging economies at cheap rates. The domestic unemployment rate surged owing to the development of the sector initially, but in the long run it achieved equilibrium. The costs involved in implementing internet in organizations Implementation of internet in organizations has a high tradeoff between cost and the benefits associated. Despite its benefit that adds to the organizational effectiveness, it owes inherent limitations that can impact the organization and might lead to failure. Its implementation requires high cost of establishment. The initial set up cost is high. It requires professional expertise in handling transactions, sharing information and data online with clients and stakeholders. Good level of knowledge is imperative to operate systems that run on internet. Today virtually all organizations and business processes require internet. Industries like manufacturing, automobile, pharmaceuticals, banking and insurance, etc run equipments that are automated and use internet. Even manufacturing equipments are run on internet which controls the input mixtures. This requires high level of knowledge and organizations have to employ people at higher cost. Existing workforce needs to be trained and required skills need to be developed that will meet organizational requirements. The training costs are comparatively higher and organizations need to continuously assess the training needs to align the workforce with the organizational practices. Implementation of internet requires less number of people as this leads to workforce layoff. There may be employees who may not be in favor of the change and might lead to conflicting behavior in organizations. This will impact the resource sharing and allocation between the employees. The organization culture will be affected which will lead to high employee turnover resulting in low productivity. Employee lay off owing to technological change affects the workforce productivity ratio. This eventually leads to paying high compensation package to the highly skilled workers that match the organizational skill sets. Organizations need to set up technical support teams to monitor the computer systems that run the internet. Disruptions in the network will impede the flow of work. Organizations need to incur additional costs that will resolve internet related issues. With the benefit of internet that provides storing and transferring large volume of data and information to various stakeholders the rise of cyber security threats have also risen. This exposes the confidentiality of information and data that will negatively impact the organization. Competitors will leverage such information and use it in its best interest. Hackers look to access such classified information and sell it to competing organizations. Critical information about clients if exposed will lead to loss of customers to competing organizations. Financial information and records are stored on the cloud and are very sensitive to organizations and various parties. Organizations need to ensure safety and security of such sensitive information which if accidentally placed in the wrong hands might lead to huge loss. Organizations need to form a separate department that will monitor the internet usage and patterns. They will ensure that the internet is not misused by any employees in their own interest that negatively impacts the organization. Organizations should create access level for its employees. It will lead to flood of information if data is not streamlined for various functions in an organization. The access of financial data to marketing vertical will be of no use and will lead to insufficient and wrong information that will lead to delay in workflow. Internet is used by different organizations for different purposes. Though the tool is available for universal use but the process is unique and must be protected, else this might lead to identical information. Thus, organizations need to patent its process and stop other organizations to imitate its process and design. At times use of internet in organizations can create distractions which will affect the productivity of the employees. It is very easy for anyone to access email and social networking sites through the internet and thus such usage at workplace will result in employees having less time to do their job. This will be followed by decreased level of output that will impact the organizational effectiveness (Sudweeks and Romm, 2012). Conclusion Internet has in many ways augmented operational efficiencies that have led to different organizational structures. Organizations have successfully implemented the technology on various platforms that have led to lower cost, increased speed and volume of transactions and information. It has led to an efficient way of sharing information and resources within an organization as well as with its various stakeholders. The speed of communication and information has led to effective decision making. It has facilitated increased accessibility of critical information that is required by the management to make strategic business decisions. Technological innovation has also led to the development of new devices that run on internet which gives different solutions to different organizational needs. Internet has led organizational change especially strategic change that has helped organizations to achieve higher productivity with reduced resource utilization. It offers low cost solutions to various business types. It has helped organizations to integrate its value chain. This has led to reduced costs and time in supply of goods and services. Although there are host of benefits associated with the implementation of internet in organizations, it has also led to potential withdrawals. It can at times affect the organizational culture. Technological innovation draws organizational change which may not be accepted by all. It requires professional expertise that might lead to increased cost and biasness in sharing information and resources. This will lead to workplace conflicts that will impede organizational growth and reduce its effectiveness and efficiency. References Sudweeks, F. and Romm, T.C. (2012). Doing business on the internet: opportunities and pitfalls. UK: Springer Science & Business Media. Read More