In this fast moving and constant changing world, where the preferences and needs of customers change at a high rate, only firms that can withstand the innovations updating and adapt to the customer’s requirement adjustments can maintain their performance high and competitive in the market. Recently, the success of any enterprise is much related to the level and quality of information system and technologies that are being used by the company and its ability to use the correct information (Walle, 2014). An information system is an organized set of interconnected systems that collect, organize, process, store and communicate information to help in making decisions in an organization by the senior manager.
Performance in business management refers to a performance analytic processes that enable firms to attain one or more chosen objectives. The importance of information systems has greatly grown in the current world market resulting to a high number of people implementing them (Galegher, Kraut & Egido, 2014).
The case study analyses the impact of information systems (IS) on the business performance and strategic development of Jamuna Fertilizer Company Limited. The paper presents a noble approach on how to use Information Systems to enhance business performance and strategic development. This paper will start by evaluating the impacts of information systems on business performance, the detailed analysis of strategic development planning and finalize with a recommendation of a new and integrated system to be implemented.
Current businesses rely much on technology for their success due to the changes occurring in the modern society. Management information system is computer database of information about a firm’s financials organized and programmed to provide reports on the operations at every management level in a company. This report will be based on the impact of information systems on business development and strategic development.
Information systems determine the general performance of how a business performs and competes with others. Many firms are faced with the challenge of designing and adopting information systems that could enable them to witness logical and continuous development (Kivinen & Lammintakanen, 2013). Implementing the wrong information systems hinders a firm’s strategic development as there could be a loss of potential customers through giving the wrong information about the business, the products or services, quantities, and qualities, etc. A firm’s strategic development plan could be barred by adoption of poor or wrong information systems for that purpose.
The business information system plays a significant role in strategic development and performance of the business as it is witnessed in Jamuna Fertilizer Company Limited. A good developed and integrated information system is crucial for enhancing high business performance and implementing strategic development plans.
Firms should have good business strategies to attain short and long term objectives. In the case where an organization lacks a strategic plan to the business, the company will run in the wrong direction (Dumais et al. 2016). The information system of Jamuna Fertilizer Company Limited faces challenges that affect its performance and development at the end. Some of the main challenges include;
Information transferring problems in a company can bring about delays in the processing and manufacturing of products. Issuing wrong information to the people in the production plant leads to counterfeit products which may affect the company’s sales negatively. In a situation where the information systems malfunctions, the information given is wrong. Delays or wrong information results in low returns hence the poor performance of an organization. The information transferring issues in Jamuna Fertilizer Company Limited could arise as a result of an updated information system and IT specialists who are qualified in that field (Li, Liu & Khan, 2014). This makes customers develop a negative attitude towards the products that an organization offers as the quality of the products is not up to standard level and also delays in deliveries. This general result will be low performance and damage the company’s image in the market.
The fertilizer industry has not lagged behind in providing products that are improved with time as it is the case in the current constantly changing world. Using the wrong components in the manufacturing process leads to end products that do not meet the consumer expectations. Failure to upgrade the fertilizer components in JFCL arise as a result of wrong information from the quality control managers. It is the duty of the quality control and quality assurance managers to keep suggesting the right updates be made in the current components. The problem of advocating the wrong components occur due to faults in the information systems that convey the wrong message and also employing unqualified personnel in the field of quality assurance. Failure to update a company’s manufacturing components lead to the production of products that are outdated in the current market. This influences the firm’s performance as most of its customers to opt to flee to the firm’s rivals who have adopted better information systems.
A good information system should be able to manage the operations of the company. In the current world, information systems are used to monitor the actions of the employees within the organization through the use of CCTVs. Through this systems, the company can address any human resource problems that may be evident. Lack of human cooperation and also full exploitation of employees in JFLC lead to misunderstanding in the company. When an employee is unhappy with his working conditions, he will probably loose morale in doing his part as before thus influencing the company’s performance (Sindelar, Lamb & Coulter, 2015).
Investing in a good information system increases the overall performance of business. As a result, company’s should start embracing and implementing information systems for their performance to be outstanding. Information systems that are employee friendly should be adopted by firms as their performance will be high once employees are comfortable in their working conditions.
Information systems should enable a firm to compete effectively in the market with its rivals. When a firm adopts wrong information system, it will face a lot of challenges as its delivery process will be slow due to issuing the wrong data (Friedman, 2013). The potential customers who the firm could rely on for high returns may end up being disgusted by the firm’s system and hence shift to buy from the firm’s competitors who adopt good information systems that satisfy the customer’s needs with ease.
Customers are the sole purpose that a firm exists. Therefore, the firm should all it takes for it to satisfy its customers. When the customers are satisfied, they will be delighted with the services and products offered by the firm, and thus they will have no option rather than to stick to the firm. Poor information system leads to customers fleeing the firm. This will eventually affect the firm’s performance negatively.
Strategic planning and analysis of agriculture industry
Strategic planning is a business process that an organization follows to attain its set goals and objectives. A strategic plan concentrates on the firm’s priorities, controlling resources and capabilities and ensures that the organization is heading in a direction such that it hits its target (goal). Strategic planning should be done in a way that it will see the organization’s performance improve from time to time.
In the current changing world, agriculture has become a major and wider sector of the economy in the entire globe. This is as a result of the increased demand for agricultural products that many types of research have shown that they are the most ideal and healthy products for human consumption (Schwalbe, 2013). As a result, the agriculture sector which depends much on fertilizers has had to retaliate to the fertilizer producing agencies demanding more products. The fertilizer producers are numerous and hence quite challenging. JFCL has to develop its strategic plan that will enable it to compete effectively in the market. Thus, SWOT analysis identifying showing both the internal environments based on JFLC and external environments in the fertilizer industry.
Strength (Internal)
The Jamuna Fertilizer Limited Company uses modern technology in its information systems. The company uses some systems in its production process that have turned out reliable for good performance of the company. The system is fitted towards achieving the firm’s objectives. The firm’s information system provides a platform for analysis, design and simulation and implementation methodology. Through this, the company can stand out in the market for its potential customers by offering them quality updated products.
Weaknesses (Internal)
The company does not have an automatic updating equipment in its information system. As a result, the manufacturing process lacks modern processes. The firm’s information from the information system is sometimes insufficient and inaccurate. As a result, the firm experiences an external weakness of damaged reputation and undifferentiated products from competitors.
Opportunities (External)
The fertilizer industry has lots of opportunities in the world market as agricultural products demand has greatly hiked. JFLC has seized this sector by developing internet market, joining strategic alliances, maximizing chances in fields where a competitor migrates and many others. Through this, the company has stood firm and competent in the market.
Threats (External)
Fertilizer products are highly demanded in the current market. As a result, the agriculture industry is very competitive most probably in the fertilizer sector. Many companies have adopted high technologies that see them produce quality products that others. Companies need to have products that are different from that of their competitors which have turned out to maintain in this industry since the components used in the manufacture are the same (Hanken, 2014). This has a huge effect on JFLC as there are many companies in the industry that have heavily invested in information systems hence tuff to beat. This may result in the company getting negative feedback from people who once used to be potential customers. This results in loss of customer loyalty and reduced the performance of the company.
Figure 1: Dimensions of information system
The dimensions in the above information system figure have their problems. After looking into the figure, it is evident that JFLC lacks proper strategic planning. This will proof it difficult for the company to reach its goals. Companies that enjoy a competitive advantage in the modern world establish good strategic plans over their rivals (Weaver, 2016). As a result, it is advisable for JFLC to adopt and implement a proper strategic plan to ensure its survival in the current market and thrive in future. Below are the alternative strategies that JFLC should undertake.
Companies are establishing relations with other organizations in the modern world. This has also increased the links in the internal systems of this companies. It is, therefore, necessary for each firm to come up with the suitable plan of connecting to the others (Cherry & Jacob, 2016). Operating a business without a strategy or integrated system is a heavy task. It is difficult for a company without an integrated system to process an order from a customer who requires a lot of products. It would be easier to solve this kind of issues when a company implements integrated information systems.
Table 1: Proposed strategy for JFLC
|
Case Study – JFLC |
Proposed Strategy |
|
Where does JFLC compete? |
– World Agricultural Market – Mid-priced Market |
|
What unique value does JFLC bring? |
– Urea fertilizers and bonus ammonia |
|
What resources and capabilities does JFLC utilize? |
– Integrated Information System – Modernized production equipment – Information Technology (IT) resources – Just-in-time strategy – Training and expertise of employee |
|
How does JFLC sustain its value? |
– Focusing on Customer Relationship management (CRM) – Offering services not present at their rival – Continuous Quality Improvement |
World agricultural market is growing at an alarming rate, and this is expected to increase in the coming years. Health concerns have been raised by different health experts about some foods that cause health issues such as cancer (WHO, 2015). They have proposed agricultural products as most healthy and safe commodities. This has resulted in an increase in agricultural product demand. Due to this reason, JFLC should be able to compete effectively in the agricultural industry as its products have hiked demand.
Mid- priced market – fertilizer will be offered at affordable prices to customers who operate small farms to be able to purchase them (Kiranvir et al, 2015). This will be possible if JFLC comes up with a strategy that will meet the needs of customers at all levels in the market.
Urea fertilizers which are the highest pretentious have seen JFLC be an established dealer in fertilizer products in Bangladesh and world at large. With the integrated system, the company will be able to produce a higher nutrient fertilizer (Cordray et al, 2015). An offer of bonus ammonia fertilizer to any package that customer purchase will see many customers reach out JFLC for their products.
The integrated information system will enable collecting data from all the departments of the company. Software vendors such as IBM would be of interest to JFLC. The integrated system will ensure that the company maximizes its manufacturing process.
Modernized production equipment- the tools and equipment that the company uses in the production process are outdated. Therefore, the company should carry out an update on the equipment’s used.
Information technology (IT) resources- IT is very crucial to business success. JFLC should embrace investing heavily in IT systems (Lowery & Johns, 2015). It should also provide the required manpower, operating systems and internet platforms for the company.
Training and expertise of employee- the current strategy has resolved employee related issues. Human resource information system should provide solutions to improve employee development. The integrated system has proposed training the employees of what is expected of them to improve their output.
Just in time strategy- on the implementation of the appropriate information system, information will flow well within the organization. This strategy will ensure that customer delivery are done perfectly and swiftly in time.
Focusing on customer management- JFLC has implemented a system that supports good customer relationship. Through this system, the company can maintain its potential customers as well as attract new ones.
Offering services not present at rivals organizations- the case project has a system that offers after sale services such as free deliveries and packaging. This ensures that the customer is contented and feels valued.
Continuous quality improvement- JFLC uses quality management techniques to ensure that their products are of the desired quality.
Implementation of ERP
For the case study, this project suggests the strategies of subsidized costs, management and identifying market gaps. These strategies help the case project “JFLC” to operate successfully and satisfy its customers (Domeika, 2015). Through good use of information system and adoption of EPR software, production processes and will be lowered as the quality of products is increased. The software ensures efficient production in fertilizer products.
The adoption of the new system should be done in levels so that employees have enough time to adapt to the changes.
Organizational structure
The two common types of structure are a traditional and flattened hierarchy (Satyendra 2013). The traditional hierarchy has more management levels than flattened. Information systems have been employed to reduce the number of phase in a firm to come up with low-level structure. Through this process of division, efficiency is increased at each phase as the people involved get the right information from their seniors. Doing away with the intermediate phases lowers operation and management costs (Laudon 2013).
JFLC will have to undertake three changes which are rationalizing the business, automation and redesigning. Automation will see employees work more perfectly as it does away with all manual processes in JFLC and increases output. Rationalization ensures constant quality improvement tactics. Redesigning will ensure changing the business design into a simpler one.
Organizational Culture
Coming up with new information systems and changing the current ones is quite an involving task. It requires human resources who are highly knowledge in that field to undertake all the procedures of the new information systems (Kuperman, 2013). Some organizations find it hard to adopt these changes due to their culture. JFLC should be familiar to these changes before initializing them.
For the company to have a successful embrace of the new system, it should come up with strategies that make the employees know about them and their impact on the business performance. The firm should train employees about these where necessary.
The integrated model system
JFLC need to be constant in the market to claim its position. Changing an organization’s system comprises of numerous activities that may alter the functioning of the entire current system. The case project should take into account the effect of the new system. The support of the organizational culture and structure are important factors for an organization to consider when employing new information systems.
JFLC has to know the dimensions of the new systems, how they will be organized and the technology they will use. This knowledge will be of help to the firm in using the new system accordingly and offering solutions to any arising problems.
Figure 2: The proposed integrated system
Below is the new proposed data flow system that will enable customers to make their orders online.
Conclusion
Information systems are crucial to organizations operations as they work to give the business options that make it keep its performance high. They give the business updates on what the current market needs for one to be successful as well as what competitors are doing.
Hence for JFLC to thrive in the current market, it should adopt a system has improved the strategic plan. Taking into account the information system suggested in this report, JFLC can overcome all problems it is facing currently and operate toward a promising future.
References
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