Presently, information system (IS) play major role in business organization in encompassing the use of information technology (IT) for the purpose of developing products, services, and capabilities which provide strategic advantage to the company at global level. Various ISs have been introduced for supporting the business organizations in gaining competitive position and advantage for companies. Those ISs which are strategic in nature are used by the business organization in connecting things or other parts of the chain, and this result in competitive advantage to the company. It also helps the business organization in meeting its strategic business objectives (Aldhmour & Shannak 2009).
As stated by author, IT/IS application are effective and efficient in nature and these application are used for the purpose of establishing, converting, and sharing knowledge management (KM) systems which not only affects the process related to organization management, but also affects the way in which human resources of the organization are managed. Furthermore, IS/IT applications help the organization in improving the management system and decision making system of the organization. Another reason of use of IT application by business organizations is that it reduce the cost and help in increasing the productivity by cutting down the cost and improving the quality of the products or services. However, IT/IS applications provide various measures to business organizations which help the organization in gaining competitive advantage over other organizations (Powell & Dent-Micallef, 1997).these measures can be understand by discussing different ways through which IT/IS applications are used by the business organization.
Business organization can gain the competitive advantage over its business competitors by cutting down the cost and expenditure related to products and services and also by introducing innovative products and services which ultimately attract the end users of the products and services. Business organization can also gain the competitive advantage effectively by ensuring development of alliances, locking-in the customers and supplier, increasing hurdles and using the investment properly in IT section. However, for the purpose of reaching the strategic advantages and competitive advantages in business, organization must analyze various factors of internal and external business environment (Hemmatfar, Salehi & Bayat, 2010).
Information technology can be used by business organization in unique and effective manner for the purpose of improving products or services. Availability of more information facilitates the company in creating strategic IS/IT application for the purpose of strengthen their planning and strategies related to business and also ensuring corporate innovation. Information Communication Technology provides important information to the business organization which help he organization in generating meaning customer data (Papulova & Papulova, 2006). Data related to customer is collected every time when customer is interacted with the system and this data is analyzed and collective harvest information for business organization for the purpose of developing the business intelligence systems or applications. They further stated that it is necessary to use technology as platform because it helps the organization in consolidate the needs of customers and corporate missions.
This can be understood through example, Southland Transportation Ltd., (bus operator of a Calgary-based school), searching the options through which they can increase their customers service system by communicating interruptions to bus schedule and this schedule is depend on various factors such as drivers availability, conditions related to weather, increase in traffic, and for safety purpose such as avoiding kids to wait in cold weather. The main intention behind this innovation is to inform the parents in advance about any delay that might be occurred in schedule of bus. For ensuring all these requirements, company develop a communication system in the form of mobile app which inform the parents about any delay in the schedule of bus, for the purpose of ensuring that kids must not wait in the cold weather. Organization develops the mobile application for blackberry platform with a custom-build mobile application for the drivers of the bus. These applications enable the bus drivers to report quickly and easily about the conditions of the road which can cause delay in the schedule to parents and Southland Transportation. By ensuring this innovation in IT section and by providing unique and better service, Southland Transportation gain competitive advantage over competitors because number of parents chooses their services which also increase the market share of the organization. In other words, innovation in information technology helps the Southern Transportation in providing better and unique services to the customer which ultimately helps the organization in getting competitive advantage over the competitors. This section also highlights the growth of business which result from the same application such as it results in comparison with large firms, additional business from existing customers, reduction in volume of call at dispatch office, and lastly increase the ability of the organization in delivering unparalleled customer service (Blackberry, 2008).
There is one more example; Google is another company which connected the innovations in IT sector to its business operations. It must be noted that, Google continuously focus on IT innovation which ultimately providing value to the end user. Google adopt various IT technologies such as AJAX which is also integrated by organization through its Google maps. Integration of AJAX provides capability to Google maps to be able to zoom and some other great and effectives features without refreshing the page. All these innovations help the organization in providing best and better services to the customers and this result in making the Google map only competitor in online map. All these innovations in IT sections help the Google in getting competitive advantage over its competitors (Bangera & Lo, 2008).
IT application is also used for the purpose of regulating the inbound logistics which also provide the benefits of totally elimination of storage costs. This can be understood through example, MITOS system integrated with the databases of material suppliers for the purpose of providing the updated information to the suppliers in easy manner with the suppliers of materials. MITOS system works as a “Just in Time System”, and it also enables the construction companies in getting the required material on time just before they run out of stock (Cakmak & Tas, 2012). This efficient and effective system helps the organization in reducing the cost related to inventory and also help the organization in getting competitive advantage over other competitors.
There is one more example; Premier Designs Inc is the USA based company which is engaged in manufacturing of cloths. This organization uses the IT/IS applications for getting the competitive advantage. IT innovations has used by the company for the purpose of cutting its cost, and for this purpose company developed mobile application called “Premier Designs Jeweler”. This application helps the consumers and other users in designing their own clothes and as result information related to consumers automatically updated in the IT systems of the organization. Through this application, company is also able to cut down the cost related to designer’s team and it increase the efficiency in terms of operations because ideas are directed generated from consumers (Sadowski, Maitland & van Dongen, 2002).
For the purpose of examine the factors of the organization which affects the innovation in the information technology. However, organizational factors are considered as most important factors which must be evaluated before making any innovation in the IT sector of the organization. By understanding the organizational factors, management can ensure effective planning which results in systematic IT implementation. It must be noted that, there is significant relationship between the resources of the organization and organizational knowledge process, management structure and values and goals with implementation of information technology. Number of researches were conducted for this purpose, and results of these researches shows that organizational factors has very considerable effect on the innovation related to IT sector and top managers must consider these factors while framing IT innovation planning. There are two types of factors that are internal factors and external factors.
Internal factors include various aspects such as management, leadership, individuals, etc., and it must be noted that company leadership is considered as most important internal business factor. Leadership style of the top management and other management officials directly impacts the culture of the organization. various aspects in this term effects the innovation in IT sector such as positive or negative nature, level of family-friendliness, effectiveness of communication and value of employees are some of the cultural implications which is related to the leadership approaches. For this purpose, companies usually provide formal structure or direction with mission and vision statements. The strength of the employees is considered as other important internal business factor. Motivated and hardworking employee usually provides better results as compared to less motivated and less talented employee. One more thing impact the innovation in IT sector that is processes and relationships between departments and employees of the organization. Good relations positively affect the innovation in IT application and bad relationship negatively affects the IT sector.
External factors include political, technological, competition, etc., and the most important factor is competition. It is necessary for organization to understand the competition and moves of its competitors for the purpose of surviving in the industry. Before making any innovation in the IT application it is necessary for organization to understand its competitors and analyze the market (Kokemullar, n.d.).
As stated by Tidd and Bessant (2015), innovation is considered as talk related to change, and this theory is supplemented by Burgelman, Christensen, and Wheelwright (2004) that innovation can be considered as changes occurred in the technology. In the context of this approach to innovation in IT sector, following are some recommendations which are stated below:
As stated by Tushman and Nadler (1997) prganization can applied to innovation to any product services or process and it must be seen in a way as to compete in dynamic environments living with continuing technological changes. In this context it is recommended that, IT innovation must be done after analyzing all the internal and external factors of the business environment and also by assessing the opportunities and threats of the business.
As stated by Schumpeter (1988), innovation can be conducted in various different forms. It is not necessary for the organization to invent something new, organization can also present the existing idea in new way for the purpose of performing it or new situation. Innovation involves the introduction of new products, services, production methods but it can also be done presenting the existing products, services, production methods in new way .
Conclusion:
It is important to note that in present world, it is not possible for any industry to ensure growth without the use of any system of IT/IS. Because of the development and changes occurred in the IT sector, it can be said that strategic moves used by the business organizations no longer provide strategic results with time. This usually happens when similar strategies are adopted by the competitors, and there is need to differentiate the made of operations of business in various companies. Some strategic management and improvements on continuous basis related to the strategic systems must be adopted for ensuring long term success. IT/IS systems are considered as those factors which contributes the success if consumers are involved in the process and IS used in strategic manner and at the right time. Information is also provided by the company which helps the organization in conducting appropriate analysis of the processes, timescales, and resources because all these things are considered as base for ensuring any continuous improvement initiative. Therefore, it is necessary to align the IT applications to business strategies and with some other factors also such as performance, features, reliability, durability, serviceability, conformance to business environment, perceived quality and these factors must be taken into consideration.
References:
Aldhmour, F., & Shannak, R. (2009). The effective utilization of information and communication technology and its impact on competitive advantage. European Journal of Scientific Research, Volume 29(3), 302-314.
Bangera, R. & Lo, M. (2008), A Case Study of Innovations with Google Maps. Available at: https://infm718zs11.wikispaces.com/file/view/INFM+718Z_Term_Project_Google_Maps_PaperRohit%26Phillip.pdf. Accessed on 5th December 2017.
Blackberry (2008). School Bus Operator Drives Competitive Advantage with BlackBerry Solution. Available at: https://us.blackberry.com/newsroom/success/Southland_BCS_FINAL.pdf. Accessed on 5th December 2017.
Burgelman, R. A., Christensen, C. M., & Wheelwright, S. C. (2004). Strategic management of technology and innovation (4th ed.). New York: McGrawHill Irvin.
Cakmak, P. I., & Tas, E. (2012). The Use of Information Technology on Gaining Competitive Advantage in Turkish Contractor Firms. World Applied Sciences Journal, Volume 18(2), 274-285.
Hemmatfar, M., Salehi, M., & Bayat, M. (2010). Competitive advantages and strategic information systems. International Journal of Business and Management, Volume 5(7), p158.
Kokemullar, N. What Are Internal & External Environmental Factors That Affect Business?. Available at: https://smallbusiness.chron.com/internal-external-environmental-factors-affect-business-69474.html. Accessed on 5th December 2017.
Papulova, E., & Papulova, Z. (2006). Competitive strategy and competitive advantages of small and midsized manufacturing enterprises in Slovakia. E-Leader, Slovakia.
Powell, T. C., & Dent-Micallef, A. (1997). Information technology as competitive advantage: The role of human, business, and technology resources. Strategic management journal, Volume 18(5), 375- 405.
Sadowski, B. M., Maitland, C., & van Dongen, J. (2002). Strategic use of the Internet by smalland medium-sized companies: an exploratory study. Information Economics and Policy, Volume 14(1), 75-93.
Schumpeter, J. A. (1988). A teoria do desenvolvimento econômico. São Paulo: Abril Cultural.
Tidd,J., & Bessant,J. (2015). Managing innovation – Integrating technological, market and organizational change (5th ed.). John Wiley & Sons, Ltd.
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