Information systems are essential for any company’s operations in this day and age. They assist a company in being efficient and to have access to accurate data. This assists in great decision making.
Thesis statement: Company desire to have a competitive advantage in today’s global environment and information systems ensure that this is possible. This paper will discuss the thesis and show the arguments in support of the thesis.
Information systems and globalization
Information systems are critical for a business to survive in the global environment. In the recent past, there has been an increasing web of interrelationships between the suppliers, customers and business across national and even continental borders with communication being instant or fast through the internet. As businesses seek to compete globally, they must have information systems that enable them operate in the global environment. Information systems have changed businesses in that it has made the business have a wider customer and supplier base and brought the company closer to these suppliers and other business partners.
Importance of information systems
In this global village, all the core relationships in the market place between the customers, suppliers and businesses have been digitally enabled. The information systems are essential as they assist a company to launch new products and business models, attain operational efficiency and experience higher degrees of customer and supplier intimacy. It is also a tool that helps the company survive and even thrive in the tough competitive environment.
Components of Information System
An information system is a system that collects and stores data from the external and external environment of the organization and distributes information to the staff of the organization. The staff and management are able to evaluate, monitor, communicate, coordinate and make decisions efficiently. In an information system, there is input, processing and output. The system is supposed to provide solution and the capital investment in such a system should make economic sense.
The information system consists of three parts or components. These are the technology, people and organization aspects. The technology refers to the hardware and the software components of a computer. It also refers to the data management technologies such as the databases. An important component is also the networking or the telecommunications technology such as the wide area networks and the internet (Laudon, 2000). Information systems need people who will collect and feed data to the system. It also needs managers who will participate in decision-making and provide leadership, strategy and the behaviour or the culture that the management should have. Lastly, the system is affected by the organization aspects of the company such as the hierarchy or structure, corporate style and culture, business processes and the political interest groups.
Solving Information Systems in Four Steps
The four step method for problem solving is a methodology that can be used to solve information systems method. The four step method gives guidelines that someone should strive to first understand the problem. The IT specialist should get to know what the users want from the system. What are the unknowns? The second step is to devise a strategy or plan on solving the problem. The specialist can come up with a flow chart showing the inputs, processing requirements and the required outputs.
The next step is to implement the plan, and the IT professionals should implement the system as per user requirements and business processes. The last step is to evaluate and monitor the progress. The specialist should find out whether the system is really helping the company cut costs, resolve customer complaints faster, gather customer preferences data or even make decisions better. All this helps a company attain a competitive edge in the market place.
Business Features Prerequisite for Successful Implementation Of Information Systems
There are several features of a company that should be analysed when deciding to introduce information systems. The inputs of the company should be analysed and the outputs that are required by the managers to come up with great strategic decisions (Huber, 1982). The business processes can also be shown clearly through the use of flow charts. What kind of data will the company staff need to feed into the system?
The structure of the organization in terms of all the departments and the levels of communication and coordination between them should also be considered. All these people in the different departments will be querying the system and there should be data integrity and accuracy. With a clear knowledge of the inputs and the outputs, the IT experts will know the processing requirements demanded of the system. Implementation of the information system will be a success when all these factors are considered.
Information systems in business functions
Information systems improve the operations of several functions in the organization. In the finance function, the company is able store financial data in terms of accounts receivable, accounts payable, budgetary information and general expenses in the system. It will also store information on projects, fixed assets and procurement in the system. The management will be able to access and retrieve financial data faster. There will also be data integrity as the staff will effect changes in the information quickly. The system will assist the management to efficiently track and control expenditure through budgeting, analyse its debtors and even come up with long-term plans on making profits.
The sales and marketing team or function also benefits greatly from information systems. The sales and marketing teams conduct research in the market to find out the changing tastes and preferences of the customers, competitor prices and products and the success of the company products in the target markets (Talvinen, 1995). All this data needs to be fed in the system and analysed so that the managers can come up with the best decision on the products the company and the prices at which these products will be sold.
The marketing team also manages their own internal operations through the system by entering the financial budget, the number of staff and allocated activities and tracks the progress. The function can also prepare short-term and long-term forecasts of their goals and objectives and evaluate and monitor the progress regularly. The human resource functions uses the information systems in three main areas, compensation and other benefits or allowances, leave management, training and development and human resource planning. Data is fed in the system on the staff training needs and the trainings the staffs has already attended and which are pending. The human resource staffs are able to track the progress and attendance.
Compensation and allowances analysis assists the company know its payroll expenses and the effect a salary review in the whole organization or several departments will have on the overall payroll expenses. Human resource planning data or information will assist the organization plan its labour force requirements? What skills and expertise does the company need?
In the manufacturing and production function, the information systems assist in inventory and production planning, machine control and project planning. Machines in the factory are used to assemble and package the products. With material requirement planning systems, the managers are able to identify the materials required and the quantities to keep as safety stock and which portion to order from the suppliers (Grant, 2000)
The management are also able to plan where the company should open new facilities and production centres for the company. The facilities should be in strategic locations that will provide a competitive edge by reducing costs.
Impact of Information Systems on Professional Careers.
In the future, as more and more companies in the world choose to adopt information systems, there will be gaps and opportunities created in the information technology field. There will be high demand for IT specialists. There will be great jobs available high school graduates to gravitate towards pursuing careers in this field. The IT field will continue being one of the biggest employers in the world. IT professionals will be required to possess certain skills and expertise to be relevant in the market place.
They will be demand for programmers and system analysts. They will have to be experts in understanding the business processes and the user requirements in order for the implemented system to be a success. They will also need to keep pace with the changes in the global village in order to act as great consultants to the management to advise them which are the best systems to implement.
Conclusion
In discussing the importance of information systems globally and in the business functions it is clear that information systems assist a company to thrive in the tough global business environment becoming a leader in its industry.
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Huber, G. (1982) Organizational information systems: determinants of their performance and
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Laudon K. (2000). Management Information Systems, Organization
and Technology in the Networked Enterprise. New York : Prentice Hall.
Talvinen, J. (1995) Information systems in marketing: Identifying opportunities for new
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