Role of Information and Information Technology

Information technology (IT) has become a vital and integral part of every business plan.
From multi-national corporations who maintain mainframe systems and databases to small
businesses that own a single computer, IT plays a role. The reasons for the omnipresent use
of computer technology in business can best be determined by looking at how it is being
used across the business world.

Decision Making:

Concept of Decision-Making
Decision-making is a cognitive process that results in the selection of a course of action
among several alternative scenarios.
Decision-making is a daily activity for any human being. There is no exception about that.
When it comes to business organizations, decision-making is a habit and a process as well.
Effective and successful decisions result in profits, while unsuccessful ones cause losses.
Therefore, corporate decision-making is the most critical process in any organization.
In a decision-making process, we choose one course of action from a few possible
alternatives. In the process of decision-making, we may use many tools, techniques, and
perceptions.
In addition, we may make our own private decisions or may prefer a collective decision.
Usually, decision-making is hard. Majority of corporate decisions involve some level of
dissatisfaction or conflict with another party.
Let's have a look at the decision-making process in detail.
Decision-Making Process
Following are the important steps of the decision-making process. Each step may be
supported by different tools and techniques.
Step 1 − Identification of the Purpose of the Decision
In this step, the problem is thoroughly analysed. There are a couple of questions one should
ask when it comes to identifying the purpose of the decision.
 What exactly is the problem?
 Why the problem should be solved?
 Who are the affected parties of the problem?
 Does the problem have a deadline or a specific time-line?

Step 2 − Information Gathering

A problem of an organization will have many stakeholders. In addition, there can be dozens
of factors involved and affected by the problem.
In the process of solving the problem, you will have to gather as much as information related
to the factors and stakeholders involved in the problem. For the process of information
gathering, tools such as 'Check Sheets' can be effectively used.
Step 3 − Principles for Judging the Alternatives
In this step, the baseline criteria for judging the alternatives should be set up. When it comes
to defining the criteria, organizational goals as well as the corporate culture should be taken
into consideration.
As an example, profit is one of the main concerns in every decision making process.
Companies usually do not make decisions that reduce profits, unless it is an exceptional
case. Likewise, baseline principles should be identified related to the problem in hand.

Step 4 − Brainstorm and Analyse the Choices

For this step, brainstorming to list down all the ideas is the best option. Before the idea
generation step, it is vital to understand the causes of the problem and prioritization of
causes.

For this, you can make use of Cause-and-Effect diagrams and Pareto Chart tool. Cause-and-
Effect diagram helps you to identify all possible causes of the problem and Pareto chart
helps you to prioritize and identify the causes with the highest effect.

Information Technology (IT) has made a direct and positive impact on corporate decision
making.  Companies have found uses for IT systems as they have developed and become
readily available as well as viable.  More specifically, firms have found applications of IT for
their enterprise decision making requirements.  As with any IT system, the users and
managers hope to find a fruitful use of the resource.  There are many examples of IT systems
that successfully support decision making in the corporate arena. A system that supports
enterprise decision making efforts for an organization is called a decision support system
(DSS).  An important feature of a DSS is that it combines data and analysis to support the
decision making of an organization. 

Communication between Employees, Suppliers and Customers:

For many companies, email is the principal means of communication between employees,
suppliers and customers. Email was one of the early drivers of the Internet, providing a
simple and inexpensive means to communicate. Over the years, a number of other
communications tools have also evolved, allowing staff to communicate using live chat
systems, online meeting tools and video-conferencing systems. Voice over internet protocol
(VOIP) telephones and smart-phones offer even more high-tech ways for employees to
communicate.
Inventory Management Systems:
When it comes to managing inventory, organizations need to maintain enough stock to meet
demand without investing in more than they require. Inventory management systems track
the quantity of each item a company maintains, triggering an order of additional stock when
the quantities fall below a pre-determined amount. These systems are best used when the
inventory management system is connected to the point-of-sale (POS) system. The POS
system ensures that each time an item is sold, one of that item is removed from the inventory
count, creating a closed information loop between all departments.
Data Management Systems:
The days of large file rooms, rows of filing cabinets and the mailing of documents is fading
fast. Today, most companies store digital versions of documents on servers and storage
devices. These documents become instantly available to everyone in the company, regardless
of their geographical location. Companies are able to store and maintain a tremendous
amount of historical data economically, and employees benefit from immediate access to the
documents they need.
Management Information Systems:
Storing data is only a benefit if that data can be used effectively. Progressive companies use
that data as part of their strategic planning process as well as the tactical execution of that
strategy. Management Information Systems (MIS) enable companies to track sales data,
expenses and productivity levels. The information can be used to track profitability over time,
maximize return on investment and identify areas of improvement.
Managers can track sales on a daily basis, allowing them to immediately react to lower-than-
expected numbers by boosting employee productivity or reducing the cost of an item.
Customer Relationship Management:
Companies are using IT to improve the way they design and manage customer relationships.
Customer Relationship Management (CRM) systems capture every interaction a company has
with a customer, so that a more enriching experience is possible. If a customer calls a call
centre with an issue, the customer support representative will be able to see what the
customer has purchased, view shipping information, call up the training manual for that item
and effectively respond to the issue.
The entire interaction is stored in the CRM system, ready to be recalled if the customer calls
again. The customer has a better, more focused experience and the company benefits from
improved productivity.
Resource management and Globalization
Resource management is the process of pre-planning, scheduling, and allocating your
resources to maximize efficiency. A resource is anything that is needed to execute
a task or project — this can be the skill sets of employees or the adoption of software. For
example, if you’re planning an event, a few resources include scheduling out staff for the
event, planning what vendors to use for promotional materials, investing software that allows
attendees to register, and budgeting for everything from giveaways to catering.
Why is effective resource management important?
Resource management as part of project management is all about doing more with less.
Nobody likes waste, especially in business. Resource management is centred around
optimization and efficiency. When you know what you need to make a project successful,
you can effectively understand how to plan resources in an efficient way.
Role of Information Technology in (IT) on Human Resources Function
Society and economic markets are challenged to gain a better share of the global benefits
Nowadays, every organization use information system and computer technology to discuss
everything everywhere. IT and internet are very impressive in organizational learning,
effective communication with the employees, for the impressive organizational learning
process and of the availability of information anytime and anywhere as manager required this
to use their skills and abilities in organization and for timely decrease their weakness and
other aspects Information technology has changed the organization including human
resources following function.
1. Role of Information Technology in Training
HR manager trains new staff in the organization in a more efficient manner possibly through
the information technology. Trainers work directly with new staff through the information
technology and training programs.
2. Role of Information Technology in Performance Management
HR manager uses information technology to get employee performance and also assess
employee feedback to be used for the benefit of the organization. Various hardware and
software application available to make it possible for HR manager to examine the employee
performance and established the performance standard. HR manager compares the actual
performance of the employee to standard performance and remove the differences and also
provide additional training to their employee.
3. Role of Information Technology in Human Resources Development
Information technology is also necessary for human resources development in the society and
organization and it determines development principle of human resources according to the
requirement of employees and society. Information technology helps in Human Resources
Development by developing human capabilities and quality on a continuous basis. In
information technology process, information is always produced, distributed, processed and
managed, so information technology will be the solution of problems when the training of
employees and human capabilities are combined and thus develop and enhance productivity
Globalization:
Globalization means the speedup of movements and exchanges (of human beings, goods, and
services, capital, technologies or cultural practices) all over the planet. One of the effects
of globalization is that it promotes and increases interactions between different regions and
populations around the globe.

“The process by which businesses or other organizations develop international influence or

start operating on an international scale.”
Benefits of Globalization:
 i. Increase in Knowledge: with the quickening and intensifying flows of information
and communication, people can now access more information from all over the world,
all from the comfort of home.
ii. Cheaper Products: the speeding up of flows of transportation and communication
along allows companies to search around the globe for the least expensive labour and
manufacturing costs.
iii. Increased Competition: with the shift from Euro-centrism, trade occurs between all
countries, leading to similar products coming from all different parts of the world, so
companies have to continually keep up with global trends and changes in order to stay
competitive in their market.
iv.
IMPACT OF INFORMATION TECHNOLOGY ON GLOBALIZATION AND
BUSINESS
In the past few sections we have defined what globalization is, its effects on society and its
relationship with business. How exactly globalization is able to have this much of an impact
on the global landscape and the key catalyst for globalization is, information technology. The
progression towards globalization has been around for centuries, but it really became
noticeable in the early 1900’s with technological advances. The telegraph and telephone
allowed people to communicate across borders in seconds when previously it would take
weeks or months to relay messages. The invention of the airplane allowed for much quicker
international travel, while communication devices such as the radio allowed people all over
the globe to listen to news from all over the world in near real time.
There are a select number of advances that truly have had a monumental impact on the
progression of globalization and its relationship with business.
1) Rise of the Personal Computer: The rise of the Windows-based PC, which popularized
personal computing, eliminated another important barrier that was restricting globalization:
the limit on the amount of information that an individual could obtain, author, modify, and
distribute. The PC allowed individuals to author their own digital content and share them
with places all around the world.
2) Invention of the World Wide Web: Perhaps the greatest influence on the progression of
globalization was the invention of the World Wide Web in 1991. Before the World Wide
Web, we had the internet which connected the globe, but with the World Wide Web
individuals were now more than ever able to post their own digital content for anyone across
the globe to see.
3) Fiber-Optic Cables: The first fiber-optic cable system was implemented in 1977, made of
pure glass arranged in bundles that could be used to carry digitized packets of information.
The most important benefit of the fiber-optic cable is that it has a much higher bandwidth
signal capacity than other types of transmission cables.
4) Creation of Work Flow Software: One of the first major information technology’s that
was geared to businesses was the creation of work flow software in the mid1990’s. Work
flow software is basically a software package that automates business procedures as well as
being able to pass along “workflows” such as documents, information, tasks, etc. from one
employee to another. When work flow software was first adopted, it enabled employees in
different locations in the same company to collaborate, manage and design business data that
had previously had to be handled manually.
6) Supply Chaining: A method of integrating horizontally between suppliers, retailers and
customers to create value for the company. Wal-Mart is a perfect example of supply-
chaining; as soon as a customer picks an item of the shelf and the cashier scans it, a signal is
sent to the supplier of the product, no matter their location around the globe. The signal is
received by the supplier and the supplier packs the item and ships it to the Wal-Mart store
that sold the item, Wal-Mart never even touches any of its products until they reach the store.
Because of this supply chain, Wal-Mart can move 2.3 bullion merchandise cartons world-
wide per year.
7) Digital, Mobile, Personal and Virtual Movement: More recently the world has been
swarmed with digital cameras, mobile PDA’s and cell phones along with personal laptops
and this is having a profound effect on the progression of globalization. With the growing
popularity of these types of technologies individuals and companies are able to collaborate
with one another more frequently and in so many more ways than ever before.
Information technology has become the driving force behind globalization and has become an
integral part of an organization’s business strategy. The technology provides the means by
which can move into the global marketplace. In the next section I will cover specific
examples of how companies can use information technology to create global strategies that
will help them compete and maintain a completive advantage in the global environment.