It’s not business as usual in the global economy anymore. As managers, most of you will work for firms that are intensively using information systems and making large investments in information technology. You will certainly want to know how to invest this money wisely. If you make wise choices, your firm can outperform competitors. If you make poor choices, you will be wasting valuable capital.
Check out London Business Training & Consulting (LBTC)’s Advanced Management Information Systems course.
How Information Systems are Transforming Business
Changes in technology, and new innovative business models, have transformed social life and business practices. Smartphones, social networking, texting, emailing, and Webinars have all become essential tools of business because that’s where your customers, suppliers, and colleagues can be found.
Businesses are using information technology to sense and respond to rapidly changing customer demand, reduce inventories to the lowest possible levels, and achieve higher levels of operational efficiency. Supply chains have become more fast-paced, with companies of all sizes depending on just-in-time inventory to reduce their overhead costs and get to market faster.
As newspaper print readership continues to decline, more than 168 million people read a newspaper online, and millions more read other news sites. About 83 million people watch a video online every day, 66 million read a blog, and 25 million post to blogs, creating an explosion of new writers and new forms of customer feedback that did not exist five years ago. Social networking site Facebook attracted over 1 billion monthly visitors in 2014 worldwide. Businesses are starting to use social networking tools to connect their employees, customers, and managers worldwide. Many Fortune 500 companies now have Facebook pages, Twitter accounts, and Tumblr sites.
E-commerce and Internet advertising continue to expand. Google’s online ad revenues surpassed $17 billion in 2013, and Internet advertising continues to grow at more than 15 percent a year, reaching more than $43 billion in revenues in 2013.
Strategic Business Objectives of Information Systems
Entire sectors of the economy are nearly inconceivable without substantial investments in information systems. E-commerce firms such as Amazon, eBay, and Google, simply would not exist. Today’s service industries – finance, insurance, and real estate, as well as personal services such as travel, medicine, and education – could not operate without information systems. Similarly, retail firms such as Walmart and manufacturing firms such as General Electric require information systems to survive and prosper. Just as offices, telephones, filing cabinets, and efficient tall buildings with elevators were once the foundations of business in the twentieth century, information technology is a foundation for business in the twenty-first century.
There is a growing interdependence between a firm’s ability to use information technology and its ability to implement corporate strategies and achieve corporate goals. What a business would like to do in five years often depends on what its systems will be able to do. Increasing market share, becoming the high-quality or low-cost producer, developing new products, and increasing employee productivity depend more and more on the kinds and quality of information systems in the organisation. The more you understand about this relationship, the more valuable you will be as a manager.
All this and more is covered in extensive detail on LBTC’s Advanced Management Information System course.