so as this is my final blog …..i have decided to go through why businesses would even consider developing and purchasing information systems …..what is in it for them i.e. how they will benefit from the information systems they develop or purchase.
as has been proved through the series of these blogs …there is both an argument for both the developing and purchasing of I.S , however whichever one you decide to pick the organisation will receive the same benefits.
below are 6 benefits or roles of information systems in organisations
Information systems i.e. TPS or MIS can help make a business more efficient and can help improve and make business processes quicker. faster and more efficient processes use resources in a more effective way and therefore can decrease costs hence increasing profitability for the organisation. information systems are vital for businesses, especially managers if they want to improve efficieny and productivity. Example is Wal-Mart that uses a RetailLink system , which digitally links its suppliers to every one of Wal-Mart’s stores. as soon as a a customer purchase an item , the supplier is monitoring the item , knows to ship a replacement to the shelf.
New Products, Services and and Business Models
Information systems are a vital tool for aiding a buisness to create new products, services and even completley new business models. a business model describes how an organisation produces, delivers and sells a product or service , and therefore it is very important that it is as efficient as possible and information systems help businesses do this. Example Apple inc transformed an old business model based on its iPod technology platform that included iPod, the iTunes music service, and the iPhone.
Customer and Supplier Intamcay
the more a business serves a customer well, the more likely they are to come back and purchase products again and again, this would raise revenue and therefore profit. it is therefore important for an organisation to know its customers well. Likewise with a businesses suppliers , the more they engage with suppliers, the better suppliers can provide vital inputs. Example: The Mandarin Oriental in Manhattan and other high-end hotels exemplify the use of information systems and technology to achieve customer intimacy. they use computers to keep track of guests’ preferences, such as their preffered room temperature, check-in time, television programs.
Improved decision making
businesss often are in an environment where information is limited and they never have the right information at the right time to make an informed decision. as a result of this bad decisions can be made and therefore bad outcomes happen, these bad outcomes result in raised costs and loss of customers. information systems have enabled real-time data get to the right people and therefore have greatly improved managers ability to make decisions Example: Verizon Corporation uses a Web-based digital dashboard to provide managers with precise real -time information on customer complains, network performance.. Using this information managers can immediately allocate repair resources to affected areas, inform customers of repair efforts and restore service fast.
when firms acheive one or more of the above ( imprved decision making, operational efficiency, new products services. customer supplier intimacy) chances are they have already gained competitive advantage. All these things allow a business to do things better than its competitors i.e. charge less for a supierior product, have a better performance and also have better responses to customers and suppliers. these all add together to result in higher sales and therefore higher profits Example Dell Computer is an excellent example of an organisation that gained a comeptive advantage because they made their internal operations more efficient
Businesses often invest in information systems because they are a just a neccessity in order to survive in an ever changing and evolving business environment. Businesses need to keep up with their competitors or new regulations and developing or purchasing information systems can help do this. Example Citibank introduced the first automatic teller machine to attract customers through higher service levels, and its competitors rushed to provide ATM’s to their customers to keep up with Citibank. providing ATMs services to retail banking customers is simply a requirement of being in and surviving in the retail banking business.
These all prove that to operate and be successful in the business world today information systems are a MUST!!!! …..This is why organisations will go to the trouble of developing information systems specific to them or purchase systems if it is appropriate for them.
hope you have enjoyed my blogs 🙂