Importance of Technology and Its Contribution to Modern Organizations - Report Example

Running Head: IMPORTANCE OF TECHNOLOGY AND ITS CONTRIBUTION TO MODERN ORGANIZATIONS Student’s name Institution Course Professor Date Table of Contents Table of Contents 2 EXECUTIVE SUMMARY 3 1.0INTRODUCTION 4 2.0LITERATURE REVIEW 4 3.0 CRITICAL ANALYSIS 6 4.0Conclusion 12 5.0 REFERENCE 14 EXECUTIVE SUMMARY There have been wide emergences of new technology and innovation in the modern world. Innovations and technological means have continually put to use by organizations. Various researchers has studied and come up with the various contributions of technology and innovation to organizations and the general economy at large. This report analyses the contributions and importance of technology and innovations to various organizations. It looks into how technology and innovation has helped various sectors and departments in the organizations to aid in the realization of the overall objectives of the various organizations. This report looks into the contributions and importance of technology and innovation to production in organizations, marketing, human resource, financial systems among other sectors of the organizations. This report analyses this using secondary information and research carried out by various research on the use of technology in organizations. Technology has contributed greatly to various sectors of organizations. The use of technology has seen organizations improve their productivity and their functionality at large. This has made many organizations to encourage and put in place use of technology in their organizations. Technology is thus looked as one of the necessary resource in successful achievement of organizations goals. 1.0INTRODUCTION Over the current decades, there has been high evolution of technology in the world. The changes in technology have made many organizations to make technology as one of their important resource in increasing productivity, profits, competitive advantage among other goals of the organization. Previous research has shown that various forms of technology have contributed greatly in improving organization performance Kohli and Devaraj (2003). The various advantages resulting from implementation of technological changes in organizations has made it necessary for many organizations to implement technological innovations in the running of their organizations. Brans, P. (2003) notes that the use of new technology and innovations in the running of the business of “Technology is a resource that, like financial and human resources, is pervasively important in organizations.”Burgelman R, Christensen C and Wheelwright S, Strategic Management of Technology and Innovation, McGraw Hill, p.237.This statement is true given the fact that technology like other types of resources contribute jointly towards the success of the organization. This report tend to explore in detail the various importance of applications of technology to organizations and their contribution to modern organizations 2.0LITERATURE REVIEW From the time of neoclassical economists, the use of technology has been highly emphasized. Neoclassical economists insisted on the advantages of technology in the reduction of cost of labor. Various researchers have carried out various researches on the contribution and importance of technology to organizations. There have come up with many findings on its importance that organizations gain from its implementation. According to Brynjolfsson (2002), the applications of technology in the running of organizations have resulted into increase in productivity, efficient human resource practices, increased profits and efficient information transmission in the organizations. He notes that the extend of the advantages of applications of technology depends on various factors like the management practices of the organization, the organizational structure as well as the competitive macro and micro environments of the various organizations. He however, majors his study on the applications of information technology in his study. His study majored on the applications of various technologies in the information technology in the organizations he carried out his survey. Bermudez studied the various changes in the business environment and what lead to the current globalization in the world. In his findings, he comes out with the fact that the current globalization has been greatly been due to the breakthrough in the technological environment especially in the manufacturing field and in information and technological field. He notes that technological changes have generally led to the successful emergence of multinational corporations, e-commerce, and reduction in production costs among other advantages. His study however was based on the global economy without taking into consideration the micro economic conditions of specific organizations. European Commission’s high-level Research Advisory Board in the year 2005 carried out a research in technology and research in its member states. This research was to find out new technological inventions in the member states and the various policy frameworks. In their report they emphasized the need of clear policy framework and good funding of technological innovations. They saw the need of educational institutions, research and development in the realizing effective technological economy. In the study, they also analyzed the various drivers of technological changes and innovations. They found out that the main driver is the need of coming up with a proper way of doing various tasks. This is like a gap that calls for a way of filling it. Presence of such a gap motivates researchers and organizations to come up with modern technology that brings out more benefits to them. They carried out research mainly in the production sector living out other sectors of production. This thus calls for the need of studying each of the sectors individually in order to eliminate the short comes of this research. This despite there being many researches in contributions and importance of technology their short comings calls for more research. 3.0 CRITICAL ANALYSIS Implementation of technology in organizations has various advantages to organizations. This report looks at some of the various contributions and importance it has brought to the organizations. USE OF TECHNOLOGY IN IMPROVING PRODUCTION Use of technology in organizations has greatly led to productivity growth, ESCWA (2011). Most of available aggregate level evidence shows that investment in information and communication technology and technology in general increases economic growth and productivity growth ((OECD, 2000; Oliner and Sichel, 2000; Council of Economic Advisors, 2000; Jorgenson and Stiroh, 2000). In this studies there have looked on how technology has influenced the growth of various industries and organizations in both Canada and the United States of America. By increasing on labour productivity of employees, high production and hence there is increase in the profits realized by the organizations. Jorgenson and Stiroh (2000) analyze how technological progress and its use in the United States of America has lead to increase in growth of industrial productivity. At the firm level, Brynjolfsson and Hitt (1997) studied the correlation between use of technology and productivity growth. He studied 600 companies to see the relationship. In his research, he comes out with the fact that they are positively correlated. That is the more use of technology results to increase in productively realized in terms of increase in quantity of output. In the service provision organizations, use of technology increases provision of services. Brynjolfsson and Hitt, (2000) reported in their findings that use of technology in this sector increases output like in production or manufacturing sectors. IMPORTANCE OF TECHNOLOGY AND INNOVATION IN INCREASING PRODUCT QUALITY AND VARIETY Technology in organizations contributes to the production of quality products and a variety of products in organizations. Yuying Xie (2008) noted that high use of technology and research and development has made companies to produce high quality goods and thus making consumers to benefit from the same. Ashoka, Igan and Fabrizio (2007) notes that apart from technology improving product quality it goes on in improving the profits and sustainability of the organizations as well as benefitting customers in enjoying a wide pool of products. Shrivastava, (2003) carried out research on the advantages of the use of technology in various organizations and noted that technology innovation helped most of the industries he studied in the U.S.A in improving the range of products they supplied to customers as well as value addition in the current products they use to produce. Technology makes it easy in the production and manufacturing of a wide range of products in the same industry, Bryjolfsson (2010). According to his research, the wide range of innovative machinery in the production, distribution and provision of services to customers has made it possible for organizations to be able to produce a variety of products and be able to serve a big market share. This is because technology has made it possible for a 24-hour production, multi tasking, self-controls in industries, and faster production among other advantages in the production that makes production to be efficient and hence possible to produce a variety of products, Schwalbe (2012). Customers and the organizations have thus able to enjoy benefits resulting from the same. CONTRIBUTIONS AND IMPORTANCE OF TECHNOLOGY IN HUMAN RESOURCE FUNCTIONING Use of technology improves the efficiency and effectiveness of the human resource functioning of the organization, Chanda, A., Sivarama, K. B., & Shen, J. (2007). Technology has been highly used in the human resource sectors in modern organizations. There have been high use of Human Resource Information technology HRIT, implementation and use of electronic human resource management (e-HRM) Strohmeier, (2007). Snell, Stueber, and Lepak (2002) observe that HR can meet the challenges of simultaneously becoming strategic, flexible, cost effective and customer-oriented by leveraging information technology. They note that use of technology in HR helps the managers to lower the administrative costs, increase the efficiency of the work force, speed response time, improve decision-making quality and enhance customer service all at the same time. The advantages above have made many organizations to adopt new technologies. With high globalization and development of multinational companies and big organizations, human resource management is difficult to undertake. Managing workers spread across various countries, cultures, and political systems is difficult. As such, manual HR is difficult but this problem can be dealt with the use of new innovative human resource management strategies, Beckers & Bsat (2002) and Zoltners (2001). The capacities of the human resource systems increase with the application of information technology that enables easy coordination, planning, communication and organization of workers across a wider area. The potential of increasing the capacities of human resource in many organizations according to Cedar (2009-2010), has been realized by the introduction of human resource information systems (HRIS). Technology is generally used to undertake various functions in the HR. Enshur, Nielson and Grant-Vallone , (2002), notes that technology is used in recruitment, training and development, healthy and safety, employee relations and legal issues, retention and work-life balance. They note that this hold the promise of meeting challenges of HRM area in the future such as attracting, retention and motivation of employees, meeting the demands of strategic HR functions and generally increasing the efficiency of the HR practices. Use of technology in the management of organizations is thus a way of improving their efficiency and effectiveness, Boroughs (2008). IMPORTANCE OF TECHNOLOGY IN THE MARKETING Use of technology in the marketing field has greatly brought many benefits to the modern profit oriented and non-profit organizations. There has been wide use of e-commerce and e-marketing. E-marketing encompasses a broad set of interaction-enabling technologies that are frequently used in industrial business-to-business (B2B) markets including customer relationship management (CRM) software, sales force automation (SFA), e-commerce websites, and extranets (i.e., private websites set up specifically for a customer), Betz (2011). Recent studies shows that use of technology and especially IT improve acquisition and retention by integrating IT into their marketing practices to foster rich interactions with their customers (Brodie, Winklhofer, Coviello, & Johnston, 2007; Coviello, Milley & Marcolin, 2001). Acquisition of customers has been a great challenge to many organizations due to the high competition in the market. Information technology is one way that can help the organizations counter this problem and be able to attract new customers while at the same time retaining the current customers. Internet use has highly changed the way organizations can advertise their products to various groups of people. The use of internet through means like the social media like Facebook, twitter, emails has made electronic branding and marketing one of the greatest marketing venue of the current globalised and industrialized global world, Chernatony, (2006). There has been wide use of product brand management through the introduction of technology that has made both the customers and producers to interact and efficiently exchange product and service information. These hence has made sales to increase while clients getting services and products in good time, at their convenient place and wide varieties to choose from. Dickey, I. J., & Lewis, W. F. (2009), studied the use of the traditional and the emerging e-marketing in the U.S.A and came out with the fact that e-marketing has wide advantages that are far above the use of traditional advertising like the use of newspapers, radios, door-to-door advertisements among other marketing methods. He states that e-marketing with the use of current technologies or innovations in marketing has tremendously improved the outcomes and objectives of marketing. CONTRIBUTIONS OF TECHNOLOGY IN FINANCIAL STYSTEMS OF ORGANIZATIONS Technology is also very useful in the running and operations of the financial resources of organizations. There has been widespread application of technology in various departments of financial systems of organizations like payment and receiving of funds, keeping and maintaining of financial records, preparation of financial statements among other area Lerner, J. and P. Tufano (2010). This has witnessed organizations being able to effectively control and manage transparent and accountable finances. The speed, convenience and safeness of transmission of money has greatly increased with the emergence of innovative methods like the electronic money transmission systems, ATMS, credit and debit cards, online transfer of funds like PayPal among other innovations. Innovations in the banking sector and financial money markets and stock markets have greatly improved organizations images, profitability, financial security and the general stability of financial systems among the organizations and the global economy, Tufano, P., (2003) and Llewellyn DT (2009). However, other scholars like Krugman, P., (2007) argue that the high innovation of the financial sectors is one of the major causes of financial crisis that are realized in the global economy. Introduction of innovative and modern accounting systems has eased the accounting field in general. There have been introduction of various softwares that are used to record, tabulate and analyze accounting information. Cost accounting, financial accounting, Managerial accounting, auditing has been dramatically improved by innovations in this fields, John Luft (2006). Large volumes of data on various financial matters of big and multination companies are easily compiled, then analyzed into small understandable and meaningful data with the use of new technologies in accounting, Mohamed and Lashine (2003). This makes it possible for the various stakeholders in the businesses environment to easily understand the information and make informed decisions from them. 4.0Conclusion There have been various changes in the technological field over the past decades. This has been due to the day-to-day innovations in various fields. Organizations have thus enjoyed the privilege of the innovations and technology. Technology has a wide range of applications in the various sectors of organizations. Nearly all sectors of organizations ranging from human resource, financial system, production and marketing have put in place the use of new technology. The use of technology in these organizations has continued revolutionized the daily operations of these organizations. Use of technology for instance in production has seen the organizations improve their productivity in terms of increasing speed of production, quality of products, efficiency in production, variety of products among other benefits. Technology has seen the human resource sectors improve their functionality, the financial systems of the organizations has become more efficient, transparent and faster. The marketing sector has also benefited greatly from the same. Generally, technology has improved the functioning of all sectors of the business and organizations. Improved functionality in organizations has seen them improve their profits, net worth, expand and even some to become global. Technology use in organizations usually goes hand in hand in the realization of the effective and good interrelationship in the use of other resources of the organizations. This is because for those resources to function effectively; there must be use of technological innovations to cope with the current market changes and organizations goals. Organizations should thus take seriously the use of technology in their organizations in order to enjoy its benefits. Technology should be taken as one of the resources of the organization. It should be given consideration like resources like financial resources, human resource management, and capital among other useful resources. For this to be realized organizations should invest in technology through allocating expenses in acquisition of new equipments, machinery and technocrats. Technology and innovation is thus one of the wide resources of the organizations like other resources. 5.0 REFERENCE Armstrong, P. T. 2002. A Comparison of Canada-U.S. Economic Growth in the Information Age, 1981-2000: The Importance of Investment in Information and Communications Technologies.Economic Analysis Research Paper Series. 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