The Infrastructure Of Information Technology

Published Date: 02 Nov 2017

Introduction

Information Technology or easily referred as IT is a term for handling information using electronic instrument. According to dictionary.com, IT is referred as the development, implementation, and maintenance of computer hardware and software systems to organize and communicate information electronically. Wikipedia instead refer IT as an application of computers and telecommunications equipment to store, retrieve, transmit and manipulate data, while Paige Baltzan (2013, p9) interpret IT as a field concerning the usage of technology in managing information and processing information. IT is shown as a key to help organization to run smoothly in highly competitive environment. Today, the usage of IT may include all area of doing business, it has been proved that aligning the IT and businesses can create not only business intimacy but also competitive advantage and finally the business can success and meet their objective.

How businesses today can be driven by Information Technology? Typically, people will judge IT as a usage of computers and electronic instrument to make a job much easier, but IT is more than that although computers and software are used to process the raw data and change it into valuable information. It has huge dimension where IT itself cannot confirm the business success or creates a competitive advantage. It needs a correlation between business objectives, business planning, right information, and the right people with a right knowledge who will be the decision maker for the business. IT is just a tool that will make information can be manageable with precision and fast transaction within the company and other stakeholders. The huge correlation between these factors will made the business can strive for success if it is fully utilize but on the other hand, if one of these factors does a flaw, it will gives disaster to the system that being implemented, and the whole business interest.

One of the examples of utilizing IT is Dell Computers when they faced a problem in customer service relationship (CSR). It happened when they start to outsource their technical customer service to a firm in India. It has lowered the cost and the market share increase but the customer satisfaction are declining. The strategy of outsourcing their customer service department has backfired them, and to solve the problem they introduce the social networking to gathered information, and make changes based on the customer ideas. This is proved that utilizing IT in a business can make a company know what the best for them and their stakeholders.

Understanding Business Environment and how it can be align with IT

In typical business organization, it will have certain department that will manage certain area in order to achieve business objectives. Finance, Human Resource, Marketing, Operation, Administration department are the scope or knowledge that will be used in order to strive for business objectives. Each of this department need to do their job accordingly to the plan that has been laid out. Finance department focuses on financial transaction and monitoring company’s finance situation. Human Resource department focus on hiring right people for the organization, maintaining current employees, and also prepared and hire workers that have the right knowledge and skills in order to achieve the organization’s goals. Marketing department are more focusing into how to increase sales and maintaining customer satisfaction. Operation department are focusing on production. Administration department is the heart of the company where they are responsible to make the company run smoothly. These entire departments cannot achieve the objectives if they cannot communicate, and change information effectively. This is when IT can help to create a bridge with each department and make them all together work synchronize with the company’s plan so a strategic system need to be implemented where every information can be mobilize easily within the organization.

An issue occurs when business oriented personnel do not have the knowledge of managing IT, and with this problem IT personnel and business personnel should take some consideration in understanding the language of the process when implementing Information technology in a company.

Infrastructure of Information Technology

Today, managing information is just like having another business department such as finance, marketing, and operation department. It is massive as when a business implementing the IT, it will give an impact to the whole business environment. In order to go for a success in business using IT, a business should implement a system that can support decision making for the company, the system are called Business Intelligence where according to Kenneth C. Loundan, Business Intelligence is a term to describe an infrastructure for warehousing, integrating, reporting, and analyzing data that come from the business environment. In other word, Business Intelligence can be describe as a system that connect, and collect the whole business department’s raw data and process it to become information that will help the decision maker. Instant example of Business Intelligence is Online Analytical Processing (OLAP), its supports multidimensional data analysis, enabling users to view data in different ways using multiple dimensions, so every data being process and it will create information that can represent the whole business process.

United Parcel Service has success in implementing IT in their business process. It starts when they introduce bar coded that attached to the parcel which contains all the information of the sender, destination, receiver, and when the parcel will arrive. This information has made UPS to gain competitive advantage for their business field. The usage of handheld computer called a Delivery Information Acquisition Device (DIAD) has made the flow of business process much easier where all the data can be gathered in one device including customers’ signatures along with pickup and delivery information. Package tracking information transmitted to UPS’s computer network for storage and being process for further action where it just took a few second for UPS’s driver to complete the data transaction. This system has made the whole people that involve in the business process much easier to access to the information needed. Customer can trace where their current parcel located and customer service can check the items situations based on customer inquiries.

The LEGO Group faced a situation of new era in doing business. From a manufacturing firm, they need to transform into market-oriented company in order to compete with imitators and other rivals. The whole business process in LEGO Group is being restructured when they start to outsource their production to other company. With this new strategy, LEGO had to implement a new Business Intelligence for the whole company as the operation, supply chain and human resource are effected from that change. The supply chain management needs to be reengineered to simplify the production without reducing the quality. Improvement in logistic planning has allowed them to have a more quality connection with the suppliers, and outsourcing company. At the same time in Human Resource department need to implement effective policies in retaining talented worker and recruiting new talent from diversify background as the company now expending globally. The change of business plan by LEGO Group has made them survive in the new business environment and retain their brand name in toys market.

Competitive Intelligence

In order to synchronize business with IT or to have a best Business Intelligence, a company needs to know what their business environment is. How IT can help them to survive in the competitive business environment? What are the factors that would segregate them from others in term of competitive advantage? These questions are important as IT play a major role for business planning, and business objective. How a company can take advantage from IT to strive for success. To analyze the situation, there are certain matrixes that can be used and it is called Competitive Intelligence.

As mentioned before, Competitive Intelligence is a term that being used to measure the company’s general situation in their business field. The most famous tool of Competitive Intelligence is Porter’s Five Forces which will analyze the customer, new market entrants, supply chain management, substitute products or services, and competitors. When all of these factors has been study and powered, the company now knows the best of them and the knowledge of IT can be implemented into the business planning to achieve their business goals.

Conclusion

Today, Business Driven Technology is now the new concept in doing business. It is proved that most companies that implement IT into their business have made their business process much easier to manage. It is because IT role in today’s environment are huge and comprehensive with all area of business including finance, marketing, operation, human resource and other related department can now be integrated as it can give more realistic, and holistic in providing information where quality information is crucial as that will improve decision making. Bear in mind that IT can only be very useful tools in business if it is leveraging with the right person who has the knowledge and their view in doing business can reach beyond the horizon.