Can develop and evaluate a conceptual solution for an innovation problem. Understand how to manage and execute the innovation process. Are able to describe, explain and apply innovation concepts, models and tools.
Here in this assignment we are looking forward to understand how the Information Technology Systems could be incorporated in order to develop a competitive advantage for a business enterprise. The rising global competition among business houses has encouraged business enterprises to undertake strategies that would enable them to stay ahead of their business competitors and develop a competitive advantage in the market. In order to be successful in their business endeavours business establishments needs to undertake various kinds of calculated risks which would help them to yield profit in the long run. Ensuring an effective planning is an imperative aspect of any successful business endeavours as it helps to effectively analyse all the different factors which an organisation has to encounter in the market during the course of their day-to-day business operations. This will help the business establishments to manage the operations within the business on a daily basis in an efficient manner and thus ensures the long term growth and success of thee organisation in the market. This is the main reason that this assignment has been taken up by us in order to understand and evaluate how innovative technologies could be utilised by the SME’s in the market in order to realise their business goals and objectives in the market (Asemi & Jazi, 2010).
Nowadays, the business establishments are leaving no stones unturned in order to gain a competitive advantage over their rivals. They are trying to incorporate effective business strategies without realising the long term impacts and consequences of their business decisions on the business performance of the organisation in the market. The business establishments are thus becoming a victim of inefficient decision making which is invariably increasing the operational expenses for the business establishments. This is playing a vital role in increasing the operational budgets for the business establishments and as a result lowering the profit margins for the business establishments. Ineffective business decisions often prove to be detrimental for the growth and success of business establishments as it eventually cripples the business opportunities for an organisation in the market and eventually forces an organisation to shut down their business operations (Hoeven, 2009). On the other hand, ensuring an effective decision on the part of the management will essentially ensure the steady growth and success of the organisation in the market and help the business establishments to deal with the competition in the industry with rivals present in the existing framework. This will thus help in releasing business goals and help the company to come up with strategies in order to realize those goals. An effective planning could be essentially ensured if technology is utilised for the purpose of decisions making. Technology helps in reducing and minimizing the human errors in decision making and it helps the management to accurate measure and evaluates the long term implications of their business decisions. Thus, the business establishments are able to undertake better and effective decisions by evaluating the various market factors which the business establishments have to encounter during the course of their daily business operations in the market. There are various technologies that are available in the market which helps the business establishments to undertake effective business decisions. One of the most reputed among them is the ERP Softwares which is developed by SAP (Chen et al. 2008).
The Enterprise Resource Planning (ERP) tools developed by SAP has become one of the most popular and effective business tool which helps organizations to effectively manage their business and streamline their day to day functionalities in an effective manner. This on the other hand helps the business establishments to undertake effective decisions for the future growth and success of a business enterprise. The ERP tools help the business establishments to monitor all the diverse aspects of their business in an effective manner and thus help them to undertake an effective risk analysis in the market. This helps the small and medium business enterprises to tackle and address their business risks in a proper and effective manner and thus the business establishments are able to ensure their growth and success in the market. ERP is a very advanced and innovative business tool which can help the small and medium business enterprises to compete more effectively with their familiar and well known business compatriots in the market. It helps in creating a level playing field for the lesser known business establishments and provides them an effective platform to ensure their growth and success in the market (Davenport, 2013).
In a report released by the Aberdeen Group, which the foremost provider of fact-based research, the importance of Enterprise Resource Planning (ERP) in ensuring the growth and success of Small to Mid-size Enterprises (SMEs) has been evaluated. The report “ERP in SME: Fueling Growth and Profits”, essentially describes that the implementation of ERP software tools in SMEs is extremely vital for ensuring their growth and success in the market which will enable them to transform their business operations in the market. The ERP tools would play a vital role in providing the SMEs with a foundation for conducting their transaction-based business and at the same time help in to ensure cost savings and operational improvement. The ERP tools would help the SMEs to tackle the existing business competition in an effective manner and help them to develop a competitive advantage over their business rivals. A total of 578 SMEs were surveyed as a part of this report and among them almost 80% were anticipating a growth in their overall profits and revenues. The report also states that in order to ensure the successful realisation of their business goals, it is extremely vital for the business establishments to contain their rising costs of their business operations. This will enable the business establishments to ensure that their revenue growth is not coming at the expense of their profits (Kearns & Sabherwal, 2006). The report also found out that the Best-in-Class ERP implementations are yielding the following benefits for the small and medium business establishments:
In order to ensure the long term growth of an organisation, an effective planning on the part of the management is absolutely imperative and essential. The ERP tools precisely help the business establishments in this regard. IT helps the management to undertake effective business decisions by providing them an opportunity to evaluate the long term impacts of their business decisions. It helps the business decisions to indentify the different risks which an organisation has to face in the market and thus the business establishments are better prepared to tackle and address those risks. Moreover, the ERP software tools help them to monitor their business operations in the market. It helps the business establishments to understand their strengths and weakness in the market. Thus, the business establishments are able to identify their business shortcomings which are bringing down their productivity in the market and this helps the business establishments to address their business shortcomings and bottlenecks in an effective manner (Beatty & Williams, 2006).
ERP tools help the business establishments to evaluate the diverse aspects of their business by ensuring an effective financial control over their daily business activities in the market. when organizations are able to come up with robust planning and budgeting for their business, a business establishment is able to maximise the utilisation of the available resources at their disposal and this helps them to prevent the unnecessary wastage of their resources. This helps in bringing down the cost of business operations for an organisation and helps them to maximise the profits and revenues which they generate from the market. The business establishments are able to realise their long term business goals and objectives in the market and they are able to transform their business fortunes in the market. Thus, the business establishments are able to tackle the existing competition in the market in an effective manner for developing competitive advantage in the industry in which they are operating (Malhotra & Temponi, 2010).
Enterprise resource planning (ERP) can be considered to be a category of business management softwares which provide a wide variety of choices to the business establishments which helps in satisfying the different needs of an organisation. The ERP software essentially comprises of an integrated applications suite which can be utilised by a business establishment for the purpose of collecting, storing, managing and interpreting data from their different functional activities in the market which includes – product planning, purchasing of raw materials, manufacturing or service delivery, marketing and sales, inventory management, delivery and payment of receipts (Chen et al. 2008).
ERP tools play a vital role in providing the business establishments with a detailed view (in real-time) of their core business processes by utilising the data which is effectively stored and maintained by database management systems. ERP systems play a very essential role in tracking and monitoring the various resources utilised by a business establishment such as liquid cash, raw materials, productivity, etc. This helps in effectively monitoring the status of business commitments which have been undertaken by the small and medium business establishments which includes – purchase orders and payroll. The diverse set of business applications which comprise the ERP systems helps to ensure an effective sharing of information and data across various functional levels of an organisation (e.g. – production, purchase, accounting, sales, etc.) which are providing those data. Thus, the ERP system helps in facilitating an effective flow of information between the topmost business hierarchy and the lowermost levels of the organisation, thereby helping the organisation to satisfy the interests of their different stakeholders in the market (Ifinedo, 2008).
The ERP software has been available in the market for the past two decades and this software application essentially evolved from an earlier form of software which was known as the MRP (Material Requirement Planning). The MRP has existed in the market for almost 20 years before the ERP came into existence. ERP software has been developed keeping in mind the minds the various business requirements of a typical organisation and thus it plays such an efficient role in managing all the diverse aspects of a business establishment. ERP also provides the opportunity to their users to customize them according to the needs and requirements of the diverse industries in which those systems are being utilised at present (Asemi & Jazi, 2010).
For ensuring the growth and success of an organisation, understanding the needs and preferences of the customers in really essential as it helps the business establishments to generate the necessary sales which are going to help them in sustaining their business operations in the market. This will essentially determine the amount of profits and revenues which the organisation is going to generate in the market. ERP systems can also be utilised to understand the present market trends which invariably helps the business establishments to indentify the customer buying behaviour in the market. It helps the business establishments to conduct an effective market analysis which enables the business establishments to identify the needs and preferences of their customers in the market (Hoeven, 2009). The ERP systems are playing a vital role in helping the business establishments to incorporate an effective advertising and marketing campaigns which helps in popularizing their products and services among their customers. Thus, the business establishments are able to provide their customers with the appropriate products and services which help in satisfying the needs and expectations of the customers in the market. This helps the business establishments in ensuring customer satisfaction for their consumers and thus the business establishments are able to enforce brand loyalty among their customers band retain their customers for the long haul (Finney & Corbett, 2007).
Reference
Davenport, T. H. (2013). Process innovation: reengineering work through information technology. Harvard Business Press.
Fitzsimmons, J., & Fitzsimmons, M. (2013). Service management: Operations, strategy, information technology. McGraw-Hill Higher Education.
Kearns, G. S., & Sabherwal, R. (2006). Strategic alignment between business and information technology: a knowledge-based view of behaviors, outcome, and consequences. Journal of management information systems,23(3), 129-162.
Chen, R. S., Sun, C. M., Helms, M. M., & Jih, W. J. K. (2008). Aligning information technology and business strategy with a dynamic capabilities perspective: A longitudinal study of a Taiwanese Semiconductor Company.International Journal of Information Management, 28(5), 366-378.
Velcu, O. (2010). Strategic alignment of ERP implementation stages: An empirical investigation. Information & Management, 47(3), 158-166.
Hoeven, H. V. D. (2009). ERP and business processes: illustrated with Microsoft Dynamics NAV 2009.
Asemi, A., & Jazi, M. D. (2010). A comparative study of critical success factors (CSFs) in implementation of ERP in developed and developing countries. International Journal, 2(5), 99-110.
Karim, J., Somers, T. M., & Bhattacherjee, A. (2007). The impact of ERP implementation on business process outcomes: A factor-based study. Journal of Management Information Systems, 24(1), 101-134.
Ifinedo, P. (2008). Impacts of business vision, top management support, and external expertise on ERP success. Business Process Management Journal,14(4), 551-568.
Srivardhana, T., & Pawlowski, S. D. (2007). ERP systems as an enabler of sustained business process innovation: A knowledge-based view. The Journal of Strategic Information Systems, 16(1), 51-69.
Malhotra, R., & Temponi, C. (2010). Critical decisions for ERP integration: Small business issues. International Journal of Information Management,30(1), 28-37.
Finney, S., & Corbett, M. (2007). ERP implementation: a compilation and analysis of critical success factors. Business Process Management Journal,13(3), 329-347.
Beatty, R. C., & Williams, C. D. (2006). ERP II: best practices for successfully implementing an ERP upgrade. Communications of the ACM,49(3), 105-109.
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