How Technology Provides Strategic Advantage, Term Paper Example

Introduction

Best practices are often confusing, redundant, and subject to any or all varieties of interpretation. At the identical time, they are often able, like instructions are to assemble furniture. Even knowledgeable carpenters consult dependable instructions from time to time, just as those accountable for the acquisition, deployment, and support of information technology (IT) generally would like insight into what makes practical sense. As technology has advanced, CIOs have retorted by executing new competences and procedures across the enterprise. There’s absolute confidence that it is modified the business for the better. However amidst this forward march of progress, IT leaders are generally suspecting of not truly understanding the wants of the business. CIOs are usually pressured to point out fast results from their IT investments; therefore the natural predisposition is to drive systems into producing without perpetually stopping. In order for an organization to adequately function while aligning the IT with the business object is to manage quality, speed, flexibility, and information. The quality within the business environment today does not have the option of cutting corners once it involves quality, speed, flexibility and managing info as a standard.

Businesses are constantly restructuring their business strategy to grow, or die off every day. If a company wishes to grow it should guarantee that all characteristics of its operations and processes updated, run efficiently and managed effectively. This paper will evaluate best practices in the organization in order the IT strategies with the business objectives of an organization. Businesses are increasing globally every day which require organizations to create different ways to adapt to the ever-changing business environment, and to keep up a competitive edge in their market. Within the last decade, past businesses have targeted to primarily cut costs, re-engineer or restructure, as a means of managing the best practices in the organization. Currently businesses are beginning to lean towards branching out to new areas in order to grow, by going into different industries, research new services and products, advances in technology, as a means to produce a prodigious vary of merchandise and services, and manage to keep the strategies and processes internal managing info as an asset.

For nearly each business operation, today, info technology (IT) has been a vital and indispensable part.  Business reliance thereon provides obvious advantages, it also presents significant business challenges. The complexities of IT and its connectedness to such areas of the business leave organizations more vulnerable than ever to inherent risks. Occasions that impact IT, which antecedently could be contained among the IT department, can currently have an effect on the whole business (IBM 2012). This includes corruption, inaccessibility, data loss, as well as security breaches, and infrastructure failures. These risks can rapidly become public actions that may severely impact an organization’s productivity, its name and its ability to realize strategic goals. Notwithstanding the widespread business impact that IT threats are capable of, most organizations do not contemplate orientating their IT risk management strategy with, their strategic business objectives. In its place, they continue to instrument a more traditional approach to strategic management that focuses on activity. Utilizing a cost-based analysis of what could go wrong in an indeterminate business environment, and on implementing metrics that are derivative from factors that cannot be reasonably recognized. In taking this approach organization find that it is often unreliable and will not adequately help establish and manage IT risks, or correlate to the business objectives that are expressed by management. The management must factor into, risks, technology, people, the business environment, and other unforeseen variables that will affect the business.

Perspective

Business-IT alignment is a dynamic state during which a business organization is ready to use information technology (IT) effectively to realize business objectives, usually improved monetary performance or marketplace aggressiveness. According to Andriole (2009), “companies should segment the technologies into operational and strategic layers, and adjust their acquisition, deployment, and support procedures accordingly” (Andriole 2009).  Some definitions focus additional on outcomes, the ability of IT to supply business value than means the harmony between IT and business decision-makers inside the organizations. For instance, alignment is that the capability to establish a positive connection between information technologies and therefore, the accepted monetary performance measures. This alignment is in comparison to what is usually seasoned in organizations (IBM 2012).  IT and business professionals are incapable of filling the gap between themselves thanks to variations in objectives, culture, and incentives and mutual inexperience for other perspectives of information. This rift generally ends up invaluable IT systems that do not offer adequate return on investment. For this reason, the search for IT and business alignment is considered to enhance the business.

Business-information technology alignment within organizations is considered the most influential factor, which assimilates the information technology to the objectives, missions, and strategy of the organization. There are six key factors that organizations need to realize this alignment. First, the organization should view information technology as an instrument to remodel the organization. This incorporates other revenue streams and assimilating other sides of their business into one another. For instance, virtualization in one central way to store information to combine two separate, but partnering businesses. Next, a company should hold client service, each outwardly and internally, at the utmost importance (Andriole 2009). This communication between the organization and the consumer should not be lost. Thirdly, a company should rotate each IT and business professionals across entirely different departments and job functions. They must have the data and knowledge of both sides of the organization so the comprehension, and communication are achieved. Once those three characteristics are achieved, then a company should provide clear and specific goals to each the employees throughout the organization. This will create, and integration of each entities to realize a typical goal. The fifth factor guarantees that IT and business workers understand however, the corporate makes or loses money. In doing so must prepare and create timelines for integration, creating and developing procedures, and plans to that forecast any problems (Andriole 2009). This is vital so that money is not inaccurately dispensed into the IT department, which will often yield no return on investment. Finally, the organizations should create and spirited and inclusive company culture. There should not only be informational unity, but a corporation as a whole. It is common for business, and IT professionals inside a company to experience conflict and in-fighting as lack of sympathy and therefore, the failure to supply desired results ends up in blaming and mistrust. The search for B/I alignment usually includes efforts to determine trust between these two groups and a mechanism for consensus decision-making. To recognize this approach, organizations should create a hierarchy of decisions that are able to take into contemplation the needs and objectives of the IT and the organization.

In order to adequately identify the business risks related to the employment of IT, organizations would like a broader view of IT risk that goes on the far side ancient standards, which aligns IT with the strategic objectives of the business. Specifically, they have an approach that can: improve alignment of IT with business must expand business lightsomeness by a lot of quickly responding to vary with upon, measured decisions. Protect complete and revenue by serving to measure the threats to the IT infrastructure, their probable business impact or benefit (IBM 2009). An organization’s risk tolerance to assist plan a realistic strategy. Improve IT service levels to attain strategic business initiatives by serving to manage IT risk with a lot of accurate and applicable data. Scale back money and reputational exposure by serving to guard the business against negative disclosures, losses and fines or penalties. Increase their competitive advantage by serving to them to create calculated responses to risk that competitors might lack the insight to create. By fastening classic risk techniques on to strategic business initiatives, organizations can simply document key performance indicators (KPIs), key risk indicators (KRIs), and range risks supported their impact on or contribution to strategic goals. To boot, the business is better able to implement balanced risk management plans, use clear communication plans and frequently monitor risk indicators.

Organization

In order for companies to be successful during an apace dynamical environment, they need to be ready to reply instantaneously to opportunities and threats by creating new products and services while minimalizing operational cost. With companies enabling themselves to manage speed, supplenss, and speed they are going to be ready to meet the exceptional encounters that face them. The inflated obligation to advance technology electronically has made a immense shift from the much slower process of the mechanistic ways of recent. There’s an inflated expectation for error-free automation, dynamical client expectations and shortened deadlines for delivery of the products or services. This has caused companies to find ways that to reduce human errors by victimisation technology a lot of showing intelligence. According to Adriole (2009), there are five flavors of alignment which include: strategic alignment, infrastructure alignment, operational alignment, innovation alignment, and people alignment. The perpetually dynamical business environment and dynamical client expectations are the demand to meet government regulative compliance necessities. As organizations expand their markets and production internationally, the amounts of laws the companies should fits have inflated immensely. This growth is due to the increasing pressures to meet client and consumer expectations.  The needs are continually dynamical, and increasing which in turn is inflicting competition to search out ways that to increase their quality and speed (Cross 2014). Organization must find new ways that integrate the different types of alignment that allow better optimization and utilization of business processes. As new businesses continue to pop everywhere giving the client many alternative options, companies should take the required steps to accelerate the quality and the speeds at which they can offer the merchandise and continue to dig up ways that to remain flexible with the options offered to them.

One area to best apply within the organization, is the management of a company’s quality, speed and suppleness come from information management. This process is “increasingly acknowledged as a company asset. While there are sseveral critics that voice that it has displaced the standard factors of production, and labor and capital to become the distinguished corporate and competitive resource” (Bogdanowicz & Bailey, 2002).  The companies that use this best apply should understand that today’s personnel tends to remain with a company on average are  getting used appropriately by sharing information, they are going to stay with the corporate. Strategic alignment is necessary in order for management to ensure that the investments of IT are in tune with the objectives of the business. The infrastructure alignment creates efficiency within the organization, ensuring that the organization has the best performance at the minimal cost. This alignment is best for assuming the best practices are used throughout the organization. “There’s increased pressure to organize the acquisition, deployment, and support of infrastructure technology with the right mix of internal and external service providers” (Andriole 2009). When identifying the people alignment it is one of the crucial components to alignment in organizations, which incorporates the people which needs to be competent and skilled. Infrastructure alignment creates the most cost-effective frameworks for security and reliability. While operational alignment works on the delivery of products and provides support to the areas of agility and flexibility.

Managing data as a quality conjointly referred to management are data that companies should defend. The information can be within the variety of audio or video tapes, images, and documents, exhausting drives, reports or individual information referred to as inexplicit information within the business. The value of the information and not the corporate infrastructure is where the greatest opportunity presents itself. Companies should focus their efforts on inflated potency to manage all areas of knowledge as company assets. Through management of knowledge as a quality, organizations can permit the suitable access to qualified or approved users and maintain world organizational access. Companies should bear in mind that management of this data is crucial to keeping their business during a competitive state. Companies are refined to use analytics together with enterprise reportage for business intelligence requiring them to label the information as a strategic quality. This process is helping organizations decrease their maintenance costs, scale back IT costs and set standards of consistency and procedures to take care of organizational governance. This stuff has become a mandate for the corporate that wishes to keep a competitive near the business for his or her specialty.

People

Culture is that the set of beliefs that drive worker behaviors. These will be things everyone in the company is aware of and shares, yet as unspoken rules. The acceptable worker behaviors rely on these underlying beliefs (Cross 2014). Typically these behaviors align well with the business strategy, but this is not a given. For example, some organizations have a strategic target innovation: they want staff to suppose creatively and share new ideas. If the culture is aligned with innovation, staff are compensated when their new ideas are a hit, and that they are not penalized for constructive failures. Google and Apple are two corporations that promote this type of culture. However, that is not the sort of culture for a company like Walmart that competes using a strategy that is highly centered on efficiency. In Walmart’s case, it is essential to possess clearly outlined job roles and for everybody to grasp their orders. Walmart, Apple and Google are all staggeringly winning corporations, but have terribly different cultures. That is why we are saying there is not any such factor as a decent or unhealthy culture, simply an efficient or ineffective one (IBM 2012).

Ultimately, effectiveness depends for the most part on how well the organization aligns with the strategy of the business, as there can be conflict within any organization. Even an exceptionally innovative company does not essentially want its Finance department to require risks with new accounting procedures. But all organizations would like a business strategy that pulls units and functions in conjunction with a standard purpose. The foremost winning organizations have a strategic urgency for which all functions are responsible.  For instance,  Apple competes on innovation, and its delivery and functions imitate that strategy. When the company was nearing the launch the iPhone, it created a last-ditch decision to change from plastic screens to glass screens because leaders thought this could make a much bigger splash. Another way a company manages opposing significances is to distinguish between those needed to play and those needed to win.

Organizations that use client service to win in the marketplace often have other needed-to-play ways. As an example, Nordstrom, Four Seasons Hotels and Emirates Air win on providing top-rate client expertise, but to play, they also would like quality and efficiency. Many organizations contend to win on their image, whole and reputation, but all corporations would like those qualities to play. Leaders outline the vision and direction of the organization, which have a tendency to be as a company/community and the way we have a tendency to differentiate ourselves. It is the leaders’ responsibility to model and reinforce behaviors that deliver on its vision and strategy. Leadership depends on HR to find out what staff think about the organization and its worker worth proposition (EVP), and to confirm they are making and cultivating a culture that promotes engagement of their hands, particularly of vital talent segments. The organization requires an enterprise skills, support skills that help in decision making to help in the organization’s performance. (Andriole 2009). The people of the organization must have generic structured, industry specific, and company specific knowledge that helping in providing the organization with “raw intellectual horsepower.” This will help in identifying trends, risks, and opportunities to help the organization grow.

HR works to assimilate the business strategy with management, and recompense ways and programs in a simple method that may best quicken the organization accomplishing its performance objectives. HR advises on and enables the incremental steps that may take the organization therein direction. As an example, HR identifies the fundamental roles and demanding skills that support the organization’s needed-to-win strategy, yet because the roles crucial for business segments to execute on needed-to-play ways. The HR team also guarantees that employees’ anticipated capabilities and expertise align with these priorities. This might mean giving support with relevant communications, updated procedures, and access to pertinent resources, all to assist staff understand and adopt new behaviors aligned with the required culture. Finally, wherever it finds gaps, HR is liable for showing leaders evidence that supports a modification in the talent management or reward strategy.

Acquisition and Management

Employees generally have to be compelled to be briefed or trained to properly adapt to the changes, and variations created by new technology. The training of key employees will be to blame for the technology system is mostly provided by the vendor or provider. Finish users or customers compact by the technology changes — even within the case of machine-controlled systems — may additionally need notification of the changes to the business processes or procedures shaped by the new technology (Santa, Hyland, Ferrer 2013). Technology is not any longer just servers within the basement. IT systems underpin every business process, every worker action, and every customer bit purpose. Period at anywhere therein chain is cost accounting the enterprise money, resources, and whole injury. The fact is that most corporations do not have insight into technology performance to diagnose, let alone treat those failures. Business technology has revolutionized the means corporations conduct business. Little businesses can implement business technology and level the playing field with larger organizations. Little businesses use computers, servers, websites and personal digital products to develop competitive advantages within the economic marketplace. Little business house owners ought to contemplate implementing technology in their designing process. This permits house owners to create operations victimisation the simplest technology out there.

Outsourcing and insourcing are pertinent in growing organizations that help create a competitive advantage and also help in the business world. According to Andriole, the appeal to outsourcing is savings in costs, “discipline in the form of elegant software documentation and improved reliability, in the case of software development and systems integration and efficient processes and excellent customer and employee interaction” (Andriole 2009). Before companies should take this option they should business strategy that outlines the company’s needs, and understanding the technologies that are increasing within the business environment. Advances in technology drive an excellent amount of the change that occurs in business organizations. The competitive advantage in today’s business atmosphere includes, in a nice part, staying on top of technological advancements that impact your industry. Business ways that embody effort new technologies ought to be guided by best practices that contemplate the impression on the firm, customers, employees, and different stakeholders (IBM 2012). A brand new technology project ought to originate “its goals and objectives from the company’s strategic goals and business objectives.” (Cross, 2014). For instance, a business objective can be to upsurge market share by 5 percent for a product at intervals a specific market. This objective can gain support from a technology upgrades that might increase the potency of associated business processes and decrease production prices and times. The time-frame essential for executing new technology will be formed by factors like the complexity of the new technology, the requirement to interchange recent technology and the stage of prominence technology plays in an exceedingly company’s business processes (Cross 2014). Phase in the implementation process allows for testing the technology’s capabilities when developing the roll-out. This guarantees that the incorporation of the new technology is distributed at intervals budget and on time. Increasing the speed of development and manufacturing in order to deliver  services and products to finish users faster, while guaranteeing quality, were identified because the top priorities driving technology investments.

Operational Effectiveness

Operational effectiveness refers to it domain of structure activity that is about having functions that employment well. These functions should work along and add conjunction with each other to implement the strategy. Operational effectiveness involves any range of practices that alter a company to higher utilize its resources, and better implement its processes (Santa, Hyland, Ferrer 2013). In different words, operational effectiveness is about endlessly rising useful performance. In order to complete this, management will lead to activities inside the organization, improve and measures the organizations procedures that are accountable then close the loop by investment those enhancements for increased useful effectiveness. It is then the role of the CIO to implement a strategy the approach to which the operates into a to comprehensible structure whole which will succeed in the marketplace. Operational effectiveness is about endlessly rising useful performance. To do this, managers lead and management the useful activities inside the organization, measure and improve the processes that they are to blame for, and leverage those processes through standardization, communication and automation to then close the loop to produce ever increasing efficiency and effectiveness. It is strategy’s role to mold these functions into a coherent organizational whole which will succeed in the chosen markets.

The strategy starts with the organization’s capability to lead and management useful performance (1). Functions are the specialized units inside the organization that employment along to produce, and support the assembly of, its outputs, no matter they may be. Generally these specialized units reflect the fundamental method within which the organization’s activities are grouped in order to exercise management – like sales, production, logistics, analysis and development, and so on. They are specialized in order to concentrate expertise, and also the greater their expertise, the greater are their effectiveness (Realisation, n.d). Particularly once the expertise differentiates the organization from its competitors. Leading and controlling useful performance cover the activities of the organization’s peoples, which factors will lead to encouraging people to be simpler factors like leadership, training, interpersonal relationships, teamwork, etc. On the far side, the applying of such personal skills are processes. These are the unit’s commonplace methods, and by measurement and rising them operational effectiveness is combined, continued, and enhanced through constant learning and innovation. But it is not enough simply to develop worker effectiveness, and improve processes. Operational Effectiveness conjointly demands that the organization constantly and consistently seeks out opportunities to influence personal and process knowledge, by widening their application and by constantly seeking opportunities to enhance the quality and efficiency via automation (Realisation, n.d).  The aim, and also the ending, is continuous improvement in useful performance. Currently its not enough to simply to achieve a precise level of operational efficiency. Operational Effectiveness encompasses the capability to endlessly improve, leverage, and automatize.

Strategic Effectiveness

Strategic effectiveness is essential within an organization as it parallels to the science and objectives that focus on unifying the technology and business strategies, with the aim of exemplifying the full potential value of business technology solutions. In short, it allows the organization to unify business and technology decision making. Practically it resembles  a group of numerous services envisioned to help businesses groups. Business technology management includes various methods such as project and portfolio management, IT planning, business support, disaster recovery, database services, security, network management, and frameworks. (Andriole 2009). Business technology management provides a blueprint for management, provides management with principles which define each factor of an organization according to five stages of a maturity model. While these methodologies have acknowledged strengths, they exemplify a piecemeal approach. There is a need to assimilate these competences to accomplish that strategic business technology alignment, because most of these methods do not actually focus on the goals and objectives of an organization. Performance measurements such as balance scorecard, Six Sigma, or Lean are the quality improvement methodologies mostly used in manufacturing, and so on. Effective technology can facilitate connect the other 3 dimensions. (Langer 2012). The concept is that technology plays a pivotal role all told processes and can alter timely info sharing, improve co-ordination between members of an organization, and makes processes easier to execute. This concealments automation of tasks, reporting, analytics and integration between management systems. In Enterprise architecture, this could be covered with the ability needs identified by the business and therefore, the identification of applicable solutions.

Conclusion

Business technology management capabilities are defined as a competency achieved by combining every of the on top of dimensions, and making repeatable management processes that are dead with the suitable organizational structures. Business Technology Management defines seventeen of those specific capabilities, every sorted into one in all four practical areas. Governance and Organization: These capabilities are centered on the enterprise’s business executives involved with organization wide governance of business technology. It ensures that business technology decisions are successfully recognized and dead, meet the requirements of the business, manages the risk and provides correct thought to regulative, legal and business needs. Management needs to be involved with the choice and implementation of the right business technologies advantages and achieve their purposes. The organization must understands its current IT capabilities, what is presently offered, and what it is acting on for the future.  Strategy and planning allow for the organization to execute its capabilities to ensure that the business executives build the foremost applicable moves to synchronize technology and business, each reducing complexity and coming up with for future developments. Enterprise architecture will provide support for these capabilities. Creating a strategic organization architecture, allows the ability create a sustenance that ensures that applicable info and certification exists that can designate current and future business technologies that are needed within the organization. By ensuring that best practices are exercised throughout the organization, the CIO will make sure that all factors within the organization work congruently with the IT strategic plan to align with business objectives.

References

Aligning IT with Strategic Business Goals. (2012). IBM Global Technology Services. Retrieved from http://www.ibm.com/midmarket/it/it/att/pdf/it_IT_business_continuity_BCRSUW03027USEN.pdf

Andriole, Stephen J. (2009). Best Practices in Business Technology Management. http://library.books24x7.com.ezproxy1.apus.edu/assetviewer.aspx?bookid=26395&chunkid=402768173¬eMenuToggle=0&leftMenuState=1

Cross, Vanessa. (2014). Strategic Plans for Integration Technology. Chron. Retrieved from http://smallbusiness.chron.com/strategic-plans-integrating-technology-13132.html

Langer, Art. (2012). How Technology Provides Strategic Advantage. Wall Street Journal. Retrieved from http://blogs.wsj.com/cio/2012/04/05/how-technology-provides-strategic-advantage/

Realisation. (n.d). Operational Effectiveness. Realisation. Retrieved from http://www.realisation.com.au/site1/Articles/Operational%20effectiveness.htm

Santa, Ricardo, Hyland, Paul, Ferrer, Mario. (2013). Technological Innovation and Operational Effectiveness: their role in achieving performance Improvements. Production, Planning & Control. Retrieved from http://www.tandfonline.com/doi/abs/10.1080/09537287.2013.785613#preview