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Economics
Information Technology
Information Technology Information technology is a fundamental change which is taking place in the nature and application of technology in business. This change has profound and far-reaching implications for an organization. Information technology is driven by the demands of the new, competitive business environment on the one hand and profound changes in the nature of computers in the other. Information Technology systems come in the shape of many technologically advanced devices which help deliver important information to managers who in turn, use this information to make crucial decision regarding the operations of their organization. This Information Technology can come in the form of computers, robots, sensors, decision support systems. The newest form of Information Technology which is being implemented on the market today is the use of hanhhelds to aid managers and subordinates in their day to day operations. Is information Technology Flawless? Information technology ( IT ) is revolutionizing how business operate. Advanced information technology is becoming the single-most powerful force shaping the structure and functioning of work organizations, plants, offices, and executive suites. However, this revolution has not been without casualties, such as systems not running as they were supposed to, millions of dollars lost in downtime and missed opportunities, as well as computer systems that intended to expand creativity productivity instead turned around and made unwanted organizational responses and remained sluggish. These Information Technology systems usually fall short of their potential due to the failure to understand and manage the mutual influences of technology and organization throughout the extended implementation process. In recent years, many corporations have made major investments in the area of information technology. Despite these large investments, productivity and efficiency gains related to IT have been disappointing at times for many organizations. Only now are there indicators that organizations are starting to see real benefits in productivity and profits from the information technology revolution. One reason for such a delay is that the IT revolution should be viewed at as a part of a whole re-engineering and refining process that is taking place at successful companies. Some of these refinements include quicker and better product development, a better sales system, improved financial controls and predictions as well as better after sales support. One suggestion why it may have taken so long for companies to see real benefits from IT; "Consider the introduction of the electric motor in the last century. At first, most manufacturers kept their plants just like they did when they used steam engines and the gains from electric motors were small. It was only when firms realized that electric motors could be placed on individual machines that real productivity gains occurred". ( Information Technology and Corporations. Pg. 11 ) Although many corporations expressed frustration about the length of time it has taken to achieve certain payoffs from Information Technology investments, all corporations posted significant benefits within their organizations resulting from Information Technology. It is very hard for corporations to measure productivity and profits due to advances in Information Technology since there is an overall acceptance of the potential benefits of Information Technology throughout the organization. However, individual expectations for the various systems introduced have always been set at very high levels in the initial stages of implementation. This leads to frustration among staff, both at the operational and management levels. Once the systems are bedded in and debugged, the initial frustration has been replaced with still a desire for the system to do more. What Happens if IT is not implemented correctly? The result of the poor coordination of IT development also has a range of symptoms, such as a low morale among employees, failure of the system by the employees, and also disappointing results of system use. Low morale among employees occurs when a technical system, whether is be the implementation of a new computer system at a company, or the implementation of handhelds to works as well, which would be though to enhance their performance, ends up decreasing performance and lowering morale as well, due to the employees resistance to technology. Low morale may also be caused by an employees thought that his/her hard work and skill could be replaced by a newly implemented system of IT, which brought down the value of their skill, knowledge, and experience of a particular job. The result of this was suffering psychologically, socially, and economically. Employees may also turn around and ignore the Information Technology system. At times, the planners of these IT systems can fail to provide minimal organizational conditions required for an IT system to function. What can end up happening from this is that a newly implemented IT strategy in a company may not end up being used, due to the lack of decision-support, and knowledge of the system. Another option may simply be the disappointing result of an IT system. Results may be disappointing due to the potential inherent in technology not being realized. Companies oftentimes fail to realize the potential they now possess, and the power in the form of crucial information which they now hold at their fingertips. Only once this is realized, can companies take full advantage of Information Technology. For many companies Information Technology advancements are not just about profitability, they are about survival as well. The revolution of Information Technology presents corporations with important opportunities and challenges, it not only offers to reduce costs significantly, but it also allows corporations to do many things that were not possible in the past. It is a proven fact, from a survey of chief information officers (CIOs) that roughly 30 percent referred to Information Technology used for strategic reasons as their top concern, and Information Technology used for cost cutting was ranked as the third concern. At first IT systems were primarily oriented toward cost reduction, mostly to automate as completely as possible those functions that were previously performed by humans. Information Technology systems worked toward adding value, by increasing effectiveness or generating new products. What are the benefits of implementing IT? The benefits resulting from Information Technology benefits were in many different forms such as allowing all firms to accomplish tasks they had been doing before at reduced costs, it opened up possibilities to do things never attempted before, also allowed firms to "re-engineer" parts of their companies and make better strategic positions. The Information Technology had improved the companies planning and decision making efforts, cost savings, and maximized information available for the corporations. What are the setbacks of implementing IT? Although there has been much success of Information Technology, there have also been some setbacks and constraints as well. Decentralization was noted to lead to situations where it was difficult to keep a link between the various IT networks in different parts of a corporation. Certain systems were at times highly compatible, while other systems did not adjust as well. Another key issue is availability of skilled staff, as well as the difficulty of integration of new technologies and industry standards with their existing installed database. Since new technology consistently outperforms existing technology for new products, but it is not implemented as much as the older applications it replaces, so companies develop duplications of functions and their expertise is thinned out in other areas to make up for this extra work that must be re-done. It was also found that IT experts may also be large roadblocks for new IT systems being put in place, due to their interest in older age company mainframes. This slows down the introduction of a new PC or company network. The three general types of roadblocks are technological problems, human resource problems, and assessment problems, all of these factors make it rather difficult to judge IT investments on a standard of cost-benefit analysis basis. The key Information Technology related impact on corporations, workers, and society will be an introduced competitive advantage. Corporations are information engines as much as they are product engines. The corporations which realize this, and take advantage of the situation will have a great advantage over those who don't. Investments related to IT will increasingly impact the strategic decision making process within any corporation. Information Technology increases the capabilities of a firm to manage diverse parts of the organization. Research, development, and actual product design can be carried out by teams in different parts of the world. IT will also help corporations to move faster and to respond quicker to changes in the unpredictable market we live in today. IT advances are having very successful impacts on workers. Computers and other IT progresses are doing very well with both white-collar as well as blue-collar workers. It did however, take a while for the computer revolution to reach the white-collar jobs. Information Technology however, can be to blame for the downsizing of the group of middle managers, since middle managers were traditionally gatekeepers through which information flowed from the bottom of an organization to the top, and vice versa. Since the advances in Information Technology have dramatically reduced the demand for middle management gatekeepers, the top of the corporation can now directly reach the bottom, and the bottom can directly reach the top. People downstream of the middle manager are now being empowered to do the work without needing the direction of a middle manager. How does the implementation of IT influence the organization? Information Technology and the organization interact in at least seven different way. First, IT systems require new organization policies or designs, like broader and more flexible jobs, a different distribution of authority, new training programs, and a different selection of data criteria. The introduction of an IT system may evoke unanticipated organization dynamics, such as new challenges for power or status, different patterns of communication, and different patterns of monitoring behaviour. Planners can change Information Technology and organizational plans to offset unwanted effects and encourage positive ones, increasing the overall effectiveness of the system. Third, It can itself be expanded and revised by its users. This flexibility allows managers mould Information Technology to best suit their workplace needs for themselves as well as their subordinates. In the long run, this highly benefits the manager, since he/she can shape their IT system to best fit their companies goals. Fourth, it can make or promote new organizational solutions for the manager. It can help organizational members to work together across space and time, which creates broader possibilities for the home based professional. It can also provide a means to go around a centralized or decentralized organization while at the same time achieving integration and control of the organization. IT can also speed up and refine organizational adaptations to changing conditions. This way managers can customize the speed at which their company is entering the IT system. This ability for the managers to slowdown the IT system to work at their own pace is excellent for employees who are having a hard time with the new technology, and greatly helps the implementation process become more user-friendly. Sixth, IT systems and organizational reforms can sometimes be considered as alternatives, or backups for the time being. Managers can use IT as a backup plan, incase their current strategy fails. This leaves managers with flexibility and breathing room, something they do not usually have. Also, planning an Information Technology system creates opportunities for introducing organizational changes that management may view as desirable. In this case, they can use Information Technology planning to set higher standards of excellence for the future. Managers of this process should be aware of each of these potential relationships between organization and technology. If not, they will pass opportunities to develop more effective IT systems, and find themselves behind the competition. Information Technology will affect workers in the United States, Canada, and elsewhere in many other ways. There are many skilled workers in the developing world who cost far less than workers in the developed world. The impact of this globalization of manufacturing has already been felt. There is a good portion of knowledge work that can be outsourced to workers in the eveloping world. Unlike manufacturing, many parts in the service sector have no physical weight and are very easy to transport, whether it be electronically or through paper mail. Bookkeeping, accounting, scheduling are a wide range of service related jobs that can be done in the developing world and linked by information networks to corporations in the developed world by Information Technology advances. The lower cost of labour, and small shipping cost would make this a very feasible option for many corporations as the progress in the expansion of their Information Technology. What this means for us, is that more and more high end jobs will become available, and the amount of unskilled labour will dramatically decrease, since this is the easiest type of labour to move to another lower paying country. Therefore, we should be getting prepared to fill these high-wage, high productivity jobs. Bibliography:
Word Count: 2170
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