Strategic Value of Information Systems - Essay Example

Information Systems Question in large organizations, executives in all the functional areas of the firm must propose, champion and support information systems that provide sources of competitive advantage while addressing important key success factors. In this course, we have explored a variety of technological, managerial and related areas within the scope of information systems. Discuss three specific issues that executives must consider, examine and evaluate when making decisions regarding the strategic value of information systems. In order to ensure the continuous growth and success of the organization, the constitution and sustenance of business models has to consider the latest developments in information technology. The ultimate goal of Information Systems Management is to assimilate the utilization of information technology into business models and business processes to scrutinize its potential to attain business goals. Todays in the scenario of globalize market, which is full of large enterprises; the competition is getting tougher and tougher. As a result, IT departments are ponderous to become more aligned with business. There are lot of models for calculating the profitability with the incorporation of information technology but they all are trying to explore the conjunction between IT investments and the company's financial result .The process of introducing and use of new information technology in organizations is based on the skills and knowledge of experts who has the ability to master a series of interdisciplinary skills. Other factors like organizing and managing human resources, long term planning, employment, training, motivation, encouraging creative work and proper stimulating are also significant. Psycho-sociological and managing processes also depend on the working conditions, type of work and area of work, availability of human resources and skills available, working atmosphere, and other factors. It is imperative that the development of information technology department is the responsibility of information technology management and should offer the effective ways and leadership qualities to manage the human resources efficiently. Following are the issues that executives must consider, examine and evaluate while making decisions regarding the strategic value of information systems. Business And Knowledge Management Organizations are facing ever-increasing challenges, brought on by marketplace pressures or the nature of the workplace. Many organizations are now looking to knowledge management to address these challenges. Such initiatives are often started with the development of a knowledge management strategy. To be successful, a KM strategy must denominate the basic necessities and issues within the organization, and furnish the architecture for incorporating all these factors. Every organization has a specific environment and different set of requirements, signified by various factors like size of organization, its aim and activities of the organization, overall strategic direction, accessibility of resources, geographical situations and many others. As a result knowledge management strategies follow either top-down or bottom up approach for the organizations. This main emphasis of these strategies is to provide the architecture for the selection and prioritization of individual projects and activities. Again this strategic focus depend on the number of factors that include: Organizational strategy documents, such as the corporate plan or annual report Involvement of Senior management Results of other strategic research projects, such as staff satisfaction surveys. External market research. 2. Psychological Factors According to psychological aspect factors that leveraged factors of IT development are as follows: Professional contributions of each individual Level of personal professional development and satisfaction at work Communication whether formal or informal, also plays significant role in the development of modern organizations. The needs and demands of different users develop and vary constantly. Nowadays, the IT department must be capable enough to distribute the information and make it available to variety of users at different locations. Therefore they must communicate each other in an effective manner to achieve their targets. 3. Role of Management Information technology is recognised as an significant factor for the expansion and efficiency of the organization. Therefore, it is the duty of each organization to keep track f the development and use of this technology in well-organized manner. Management of IT exploitation is not very different from management of other technologies. In the last decade, the use of information technology has led to the emergence of complexities in the organization. This complexity can be viewed a result of integration of business processes and Information technology tools. Information technology management is supposed to handle technical as well as issues related to the human resource management. This requires the information technology managers must possess business process knowledge along with technical knowledge. They must understand their customer requirements and must be aligned with the vision, goals and strategy of the organization. Following are the two important aspects of information technology management: 1. Recognition of management functions Planning, organization, leadership and control are the integral part of the management. Similarly following can be regarded as basic functions of Information technology management (1) Formulation of strategy related to the development of IT department in the organization, (2) planning and structure of IT infrastructure, (3) IT activities in an organization, (4) managing human potential, (5) control and supervision of the quality of service and accordingly user satisfaction and last but not least, evaluation and judgment of IT management quality and its effectiveness. 2. Necessary personal characteristics significant for successful management It is expected from the IT manager to plan the things according to the changes to get the most favorable and effective results that are in the favor of the organization itself. He should plan the things accordingly and take the necessary action and this should be well balanced with other managerial level activities, which are again well versed with business process also. That also requires incorporation of high leadership qualities, productive output at the end of manager also. A modern information technology manager should boast the knowledge and qualities that subsidize remarkably to efficacious human resource management. High tech issues are insufficient and there are new sociological aspects appearing, such as a new science of mastermind management, which are reliant on new emerging facts and principles. Besides, every organization has its own specific goals, values and ethics that a manager has to understand so that he can develop and exploit them effectively, to meet the needs and interests of each and every person. Question 2) In small businesses, information systems tend to be more focused and specific. These firms have limited resources and are focused on immediate value. Complex systems may not be appropriate. Identify a specific market or industry, and discuss how small businesses in that area should use information systems to enhance small business success and performance. The small-scale business sector is currently one of the fastest developing and significant sectors. Information technology plays an important role in the development and growth of small-scale industries. Incorporation of information technologies has changed the business process of small-scale industries also. It has changed everything from the production process to staff training and managing human resources of organization. It has entirely changed the aspects of market competitiveness in terms of products and processes. The amalgamation of information technology into small-scale industries recompenses for size and distance and enables companies to expand and to work in a global market. Using new innovative tools and techniques of information distribution, they can no longer be isolated from international market. Such technologies includes electronic/video conferencing, mailing, tele-conferencing, electronic commerce, electronic networking etc. Internet is pool that can be used to access any kind of information without compensating on quality, legal and regulatory requirements, fiscal regulations and opportunities. It becomes very simple and easy to attain, collect any kind of information on technologies and markets with the use of various networking components. The acquired information can be used as a source of analysis to increase the productivity, profit and market share of the enterprise. The information is accessible with in a few seconds. Evolution in the world of computing and in the era of communications takes the form of global information networking. The net result of this innovation is that it decreases the cost, the time for collection the required valuable information no matter how far that information is. Along with this, the ability to collect, analyze and the frequency of transmission of data has enhanced extremely. Local knowledge can be assimilated, distributed among economic agents and then can be merged with global knowledge to give the valuable piece of information. The net effect of all these activities and use of communications technology has drastically decreased the transaction costs; expedite the triumph of scope with the familiar rapid and continuous customization. Such transmissions undermine authoritative controls since the hoarding of information is no longer possible. Similarly, the costs of writing and enforcing better contracts are minimized. It is generally recognized that the prospects educed from the development and use of information technology system are great and enormous. These benefits of the revolution, which takes place in the past decades in the era of information technology, are not limited to the large organization but they can be availed by small and medium enterprises also. Innovations in the fields of information technology makes the vast world of trading so small that even the small trader can access the information and can do the trading across the boundaries of the state and country. They can display their product on the web and attracts the customer through out the world with the use of Internet, display the list of their prices and helps the customer to compare the prices with other vendors and attract the majority of customers towards their product. This ultimately helps in increasing the share of their market value and controls the whole economy by tracking the demand and supply of the product also. One of the very good examples of this is the project by Tropical Whole Foods, which is involved in trading of dried fruit. They use the email system to exchange information in Burkino Faso, South Africa, Uganda and Zambia. Therefore desire to trade in international market is no longer right of rich traders even the poor trader can do the trading in international market through the use of internet. Question 3) Information systems professionals spend an increasing portion of their time addressing legal and ethical issues. Examples include privacy, employee monitoring and compliance. Have information systems made it less or more difficult to manage the reputation and legal standing of businesses Information security is one of the most censorious domains and a great challenge that all the organization has to face. With the use of information technology there is an increase in the variety of security threats that every enterprise face and the frequency and type of issues have become more and more complex day by day. Although the improved knowledge and with use of some specific techniques, information managers are able to give solution to the above problem to maximum extent yet the risk is still there. The main assignment is to endow the executives and information technology managers with information security issues in a meticulous way. Computers on a local area network, such as a home network or a small business network, are developed and emerged into a secured network group that restricts and control the access of user depending upon the rights and permissions and allows them to share resources among the users in the same group. Similarly different groups can be created over the network and permissions can be assigned differently to different groups. Now if one group want to access the resources available on other group, the first group has to take permission of second group by creating the trust relationship. During this establishment he has to enter the username and password to authenticate the validity of the group user. In this way information is secured over the network. Access of users to particular resource can be controlled in this way. The internet is a pool of vast knowledge but there also some ethics and rules to be followed as it involves in various kind of monetary transaction also. There also security has to be considered and taken care. With the use of new encryption techniques data can be encrypted and transferred from one part to another part over the internet. Inspite of all these efforts, hacking and email scams, viruses are all there which makes it difficult for one to trust on online data. Moreover the content available should not be copied as it professional ethics. Management and executive support is indispensable to institute, maintain and use the information security program or technique effectively. If management understands security issues and give them appropriate priority then only outlook of organizational to enforce security can be developed. Without top management support, security will likely be under resourced and considered a low organizational priority. It is important that the users at all levels in the organization must be conscious of the threats allied with computers and the Internet. Then only an organization can attain a secure computer network. This also requires giving training and knowledge to all users in the organization. Untrained and unaware users will continue to be a major problem to the security of information systems. Organizing such educational program that includes all types of training will help to ensure that employees are knowledgeable about security issues and procedures. Information security is not an integral part of most corporate cultures. In many organizations, security and risk management concepts are not integrated in the normal training process with any depth or impact. Employees tend to reckon information security as a hassle and as a result new policies and associated controls are often congregate with resistance. Security staff must build and promote an environment of security and cooperation within the organization. Organizations are struggling to find out the efficient technological processes through which they can manage, recognize, validate, and follow system users. As systems become more widely distributed and as organizations increasingly interoperate electronically, identity management and access controls have become complex and imperative issues. References Oetringer, Eugen. The IT Strategy Management Process: Supporting IT Services through Effective Knowledge Management,Van Haren Publishing, ISBN 90-77212-26-4. Davenport, Thomas H., Prusak, Laurence & Wilson, H. James (contributor). What's the Big Idea Creating and Capitalizing on the Best New Management Thinking, Harvard Business School Press, ISBN: 1578519314. S. Dawes (1996), "Interagency information sharing: Expected benefits, manageable risks," Journal of Policy Analysis and Management, vol. 15, pp. 377-394. J. E. Fountain (2001), Building the Virtual State: Information Technology and Institutional Change. Washington, D.C.: Brookings Institution Press. Read More