The Impact of ICT on Business

Introduction

Business organizations must have continuous changes and modifications because of the ongoing changes in the business environment. While business organizations are trying to improve their business performance, their focus has rapidly shifted over the previous years from the organizational level to the inter-organizational levels. This growth in the business organizational interest in the inter-organizational relationships can be demonstrated by several interlinked business trends such as:

• Information Communication Technology (ICT): Business organizations have been able to use ICT to reduce costs and increase their business capabilities. ICT developments such as the Web, Electronic Data Interchange (EDI), and email have enabled business organizations to cross boundaries easily when dealing with information intensive activities and processes. Business organizations have shifted their focus to the development of new ways and methods of conducting business. Some of the ways and methods include the development of electronic trading markets, electronic auctions, and electronic bookstores among others. The ICT has moved from the previous insignificant force supporting the inter-organizational processes into a major force shaping the processes.
• Outsourcing: Another business organization’s trend is outsourcing secondary activities. Therefore, organizations can concentrate fully on their major business thereby specializing in major costs to reduce operation costs. Their operation has necessitated this in a turbulent business environment which consists of instability and randomness. Instability refers to the frequency of change while randomness is the unpredictability of the change frequency and direction.
• Globalization: Globalization being a modern business trend has resulted from international trade agreements like the North America Free Trade Agreement (NAFTA). The trade agreements have lead to a global market where business organizations must engage in competition.

Using Information and Communication Technology (ICT) has impacted each and every aspect and feature of business. Besides transforming the ways businesses are conducted, it has also created new business sectors and jobs. The creation and rapid development of multinational companies such as Google and e-Bay that did not exist a decade ago became a possibility due to advancements in technology and the changes the technological advancements has created in the way people behave. New technological developments have put new demands on how businesses are conducted. Additionally, the developments have provided the businesses with new possibilities for developments and improvements of market activities as well as goods and services. One instance of such technological development is the application of ICT among industrial companies in conducting businesses (Gatautis, 2008).

There are many and different ICT technologies thereby different possibilities for businesses to use them as they conduct their exchanges. Some ICT solutions make it a possibility for geographically dispersed users to share databases and messages to be copied and delivered instantly and immediately to a large number of receivers. Take the example of Electronic Data Interchange (EDI). EDI is a way letting information flows go entirely through ICT such as ordering new products and information on delivery or for making payments. Integrating EDI in business processes helps to increase efficiency while permitting business relationships thereby saving time and reducing costs.

The ICT development in business has attracted the attention of researchers in the recent times. One of the views that have been established in business in academic research is the study of business between companies as being conducted in business relationships of long-term orientation. Such relationships in business contain some elements of business, information, and social elements. There are also various studies that are imposing the impact of ICT on the above, different elements. While some studies have proclaimed the ICT improves the way modern business is conducted, other studies are stating negative impacts of ICT on business. A different number of researchers and studies have discussed the impact of ICT on the content of industrial exchange between businesses. Research and studies within this field on how ICT has impacted different business operations and activities are extensive. However, the specific area on how ICT has an impact on social interactions of business relationships has received minimal or no attention. Following the demands of the contemporary research on the new studies, the paper will study the use of ICT of setting up industrial businesses relationships and how it has impacted on the social dimension (Hempell, 2005).

Business is a conduct two companies. Therefore, people from the two companies meet thereby exchanging information on everything that involves the products and these businesses. Over time, the two businesses get to knowing each other. This knowledge helps to develop a social dimension in the way the two businesses relate through the interactions. When the two businesses employ ICT in their relationship, it may change or replace entirely traditional and old ways of exchanging information and one aspect of the change could easily be an impact on how they interact socially. Social interactions comprise of the meeting between people from the two companies conducting business and so meetings between them are of interest for the study of social interactions.

Executive Summary

ICT connectivity has become significantly widespread in the businesses regardless of the size. As is the case with the emergence of technologies, other businesses are slower than others to adopt new ICTs. The adoption and use of ICT are driven by potential business benefits and sector-specific strategies. Also, sectors are becoming increasingly global where large firms are dominating. Some of the major reasons why the rate at which ICT is being adopted has slowed are a lack of applicability and inadequate incentive to change business models where there is a lack of clarity in the returns.

Business organizations also face ICT adoption generic barriers such as trust and transaction security and IPR concerns among others. Other problems are in the areas of management skills, technological capabilities, competitiveness, and productivity. The issue the government should handle is fostering suitable business environments for eBusiness and uptake of ICT. Furthermore, the government should target programs to beat market failures to such as extent that they will be required in specific areas such as specialized information and skill formation. Governments have several business and Internet use programs. Despite that, commercial considerations and potential returns from the programs are the main drivers of adoption and profitable use.

Business Need and Current Situation

Business information such as sales figures, financial accounts, customer details, payroll details, and customer details are critical in telling the owner of the business if the sales are rising or falling, the level of cash flow, whether there is timely sending out of invoices, whether accounts are being paid on the time it is required, and whether the business employees payments are correct. Businesses use data and information for copies of receipts and credit card vouchers, cheque butts, invoices, copies of payslips, and other important documents in providing the required information.

In the past business information would be generated and processed manually using the handwritten records. The method was deemed slow and often inaccurate process. Additionally, communication between the business and customers and other businesses is critical and important to the business. However, in the recent years, both data processing to generate information and the ability of business to communicate have undergone a transformation by the use of computers and widespread of ICT where most business organizations such as Lee Consultancy are leaving legacy mainframe in the business operations to the current and modern of ways of doing things.

ICT needs to be one of the critical players in formulating and implementing business strategies. Most of the businesses would come up with business strategy and then they would ask ICT to support the strategy. However, ICT has become one of the major areas that have the immense capabilities to shape the future of businesses. ICT also has the potential to create more value at the core of business strategy instead of being used as an afterthought. In the years past, ICT would mainly be driven by efficiency and standardization in the processes such as stock management, production, and invoicing. Minimal or no attention would be given to different customer processes. The various set of processes that were available led to a certain ICT infrastructure and architecture (Lee, Chu, & Tseng, 2011).

Coming to modern times you will find many businesses in pursuant of strategies that focus on customer centricity, product and service system customers, and other custom-made solutions. The strategies such as those require high levels of flexibility and with a whole new set of processes. However, on the issue of implementation of the strategies, the answer from ICT might be that it is impossible. The response is a frustrations and irritations to both business people and ICT. The reality on the ground is that most of the current ICT infrastructure and architecture have no capabilities of dealing with the new business requirements. The types of the processes that are required in a certain strategy have an impact on the infrastructure. What most of the businesses require at the moment are new methods of improving their relationships with customers, popularly referred to as strategic components. Therefore, the problem is the implementation of a system that will enable improvement of the ties between the business and the customers (Schreyer, 2000).

Scope and Out of Scope

This project will immerse inside the major challenge that Lee Consultancy is experiencing at the moment. All the factors that showcase economic losses and lack of customer satisfaction are adequately highlighted. Despite that fact, the project implementation will not address actions through which Lee Consultancy has contributed comprehensively to the technological problems being at the heart of the company at the moment. However, suitable solutions are provided since the subject problem is known well.

Resources

The project will not go to completion without utilizing the right resources and ensure the available resources are used in the most suitable way. One of the resources the project will need is the stakeholders. The project implementation and deployment will require primary and secondary stakeholders each playing their different roles in ensuring the project is implemented successfully. Corporate leaders who happen to be business owners will be required to provide all the funds needed for the project. Managers should manage the project and see to it that all the funds provided or commissioned by the corporate leaders are used towards the successful implementation of the project. Other resources are the employees who will be required to play their roles in the best way while helping implementation.

Business partners and the government will also be required to play a key role and provide the project management with other respective resources towards the project. The government should regulate the project in the best way that will meet the standards and create a conducive environment for successful implementation of the project. Others will be the society, manufacturers, and vendors where each will have a key role and responsibility.

Strategic Alignment

The implementation of the ICT project is directly aligned to support several of Lee Consultancy strategic plans. The mere fact that the project will directly support the business organization’s strategic plans; it will also improve the organization’s business while helping move the organization forward to the next maturity level. In the organization’s strategic plan for management of information, the project will improve keeping of records and management of information. The project will achieve this by allowing for real-time entry of data and information, increase information accuracy, and help to consolidate data repository for various administrative data.

The project will also help in the attainment of the goal of utilization of the new and modern technology in supporting the organization and department missions effectively. The project will do this by allowing automation of various administrative functions is thereby reducing the levels of staff requirement in managing the systems. The company also has a strategic plan for human capital whose goals and objectives are engaging the workforce and improve the rate at which they retain employees. On this, the project will enable the employees to engage actively in the management of the administrative duties.

Environmental Analysis

This project is not the first one of its kind. Other organizations in the same industry have implemented such projects in readiness for the impact of ICT in the business. However, there are instances where the projects implemented earlier took longer time than Lee Consultancy intends to take. Therefore, the project should be strategized in such a way that it will meet this objective. One of the outcomes of engaging in the project is the replacement of the current manual way of doing things at the organization. Some of the success factors are whether at the end of the implementation of the project it will be in a position to reduce employee turnover, improve the efficiency of staff, reduce overhead costs, and reduce employee turnover.

The project costs will be minimal and less than what other organizations have used in their implementation. However, the issues of cost will largely depend on what the project implementation team will recommend and according to the current market rates and prices of the equipment and items required to start off and see that the project has been implemented fully and performing the specific actions for which it was meant. The implementation of the project will lead Lee Consultancy to achieve some benefits that would have been difficult to achieve without the impact that ICT has on business organizations. Some of the lessons learned from the implementation of the project are the need for comprehensive project analysis before implementation and the need for project management. Additionally, the implementation of the project will teach us the need to consult extensively and refer what other organizations and individuals have done previously.

Market Readiness

The business organization is ready to have the ICT project implemented at the moment. The rates at which other organizations in the industry and other industries have implemented similar projects make it necessary to have an ICT project that will keep Lee Consultancy at the same level of business processes. Additionally, the business organization is running at a loss from the manual systems it is currently using which make it hard for the company to enjoy the positive impacts of ICT on business.

There is a lack of barriers to entry in the market because the project has become a necessity for business organizations. Furthermore, the implementation of the project is not for commercial use, but it is for enabling the business organizations to place itself on the path of delivering goods and services to the customers at an improved level. Therefore, the product is designed in such a way that it will satisfy the mainstream and the regulation authorities. The implementation of the project will not require any collaboration because it pertains to this particular business organization. The only collaboration required is the implementation collaboration between different stakeholders as highlighted previously.

Implementation Strategy

The ICT project will be implemented in two phases whereby

• Phase 1: It will largely involve analysis, design, and development where there are project and training plan, functional requirements documentation, test plan and test cases, functional specification document, and finally technical and user documentation.
• Phase 2: It will involve deployment and operation of the project which includes testing and closure plan of the project.

Project Review and Approval Process

The implementation of the ICT project will require the total involvement of the majority of the stakeholders. Therefore, the project manager will submit the project for review after which the process will start. The project board members will be notified immediately and review the project and whether it has met specifications. In case all the members have reviewed the project, it will be approved or disapproved depending on what they will have observed. The members will then notify the project manager of the status of the project, and the project review and approval process will end from there.

Business Case Signoff

This section refers to the project approver’s acceptance of the project content and overall intention of this business case, including acceptance of any commitments described to enable successful delivery of the initiative. Where relevant, the project approver also confirms that this business case complies with all the relevant strategies, policies, and regulatory requirements. Business case signoff should only be provided by the incumbent authorized personnel to represent the business area within which the role resides. Where a forum is providing business case sign off, a representative will be required to sign off on the behalf of the forum.

Conclusion and Recommendation

ICT is a true competitive asset, and business should know that ICT cannot be managed in similar to the material assets at the organizations like the natural resources, buildings, or land. Business should also know that there are differences between the material assets and ICT. While material assets deteriorate in value after being used, ICT, on the other hand, may even be costly when it is not put into use. Additionally, a material asset shared by people is divided among the number of people. However, ICT shared by a certain number of people does not reduce but remain in the same way. Therefore, the above shows that what ICT does is impacting on business rather than increasing costs. It should be recommended to each and every business that would like to remain relevant.

References

Gatautis, R. (2008). The impact of ICT on public and private sectors in Lithuania. Inzinerine Ekonomika-Engineering Economics, (4), 18-28.

Hempell, T. (2005). What’s spurious, what’s real? Measuring the productivity impacts of ICT at the firm-level. Empirical economics, 30(2), 427-464.

Lee, Y. C., Chu, P. Y., & Tseng, H. L. (2011). Corporate performance of ICT-enabled business process re-engineering. Industrial Management & Data Systems, 111(5), 735-754.

O'reilly, T. (2007). What is Web 2.0: Design patterns and business models for the next generation of software. Communications & strategies, (1), 17.

Rissen, J. P. (2008). Mapping the wireless technology migration path: The evolution to 4G systems. Enriching Communications, 2(1), 73-79.

Schreyer, P. (2000). The contribution of information and communication technology to output growth.

Appendix

Elicitation 1: Brainstorming

Lee Consultancy as a company facing challenges at the moment can employ brainstorming to bring its economic challenges under control. For example, the company should move on and invest in the state of the art modern technological and ICT infrastructure. This development and investment will help the company ensure that some of the challenges and problems they had been experiencing will no longer be there. Additionally, the company will be in a position to enjoy all the positive impacts that ICT has to offer at the moment.

Elicitation 2: Focus Group

Lee Consultancy should take it as the priority and initiative to upgrade its computing devices and computer systems. This will enable them to match other business organizations which have moved on to take such an initiative thereby enjoying benefits. The company investing in such sophisticated and reliable technology will be beneficial because it will be a guarantee to the company that operations and activities will continue to flow smoothly and according to how the company would like.

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