Information systems may be viewed as a purely strategic tool – they help the business to run more smoothly and they make business processes more efficient. However, in more recent times, information systems have become so much more than a strategic tool; in some cases, they may even be a tool for survival.
Some businesses cannot function without a working information system. They would simply break down and leave the market. Many businesses today use the internet as their sole means of communication with their customers, eg Ebay and Amazon. In their cases, it is obvious that they need to have a strong, effective information system in place to deal with the day-to-day running of the business. They must be able to store their information, such as inventory data, payment status, and customer details, securely. If something were to happen to all of this information, the business would undoubtedly go under.
Having a business which relies so heavily on information systems is risky but it is a more modern way to conduct business. By having an information system that can handle this pressure and by having the staff that can use the system to its full potential, the business will survive and grow to its full potential. Similarly, if the information system is not as effective as it should be, its power as a tool for survival will be limited and the business will suffer.
When people think of global warming and climate change, they usually think of excess waste, fumes, CFCs (chlorofluorocarbon) and greenhouse gases. Efforts have been made by governments and organisations worldwide to create a more sustainable environment and to lessen the effects of global warming. However, more recently it has come to light that the way in which organisations use information systems may lead to improved sustainability. ‘Green’ information systems is an important and interesting trend in information systems today.
IT departments have been forced to have an input into reducing the organisation’s carbon footprint due to regulations but also due to pressure from environmentally-conscious customers and other stakeholders.
Information systems use a huge amount of energy and it is important that this is measured if they are going to reduce energy consumption. This should be done using carbon footprint calculators or other measures.
One of the most obvious ways of reducing energy consumption is usually overlooked by organisations. Turning off the system when it’s not in use rather than hibernating it will save more energy than people would think.
Enterprise servers use large amounts of energy, particularly when cooling down. Organisations should try to reduce the number of servers in the business, perhaps by using online technology to store workloads and reduce energy consumption. If the organisation is purchasing a new server, they should look for one that incorporates factors of sustainability, such as Energy Star approved products in the US (http://www.energystar.gov/index.cfm?c=home.index).
This trend seems to be increasingly important and may even help the organisation to cut costs. They need to use initiative to find ways to reduce their energy consumption in information systems; even the smallest changes might help!
E-Government is one of the latest trends in information systems. It involves using systems to enhance the quality of and access to government services. It enables and encourages citizens to become more involved in the work of the government they have elected. It may also lead to increased transparency and more efficiency.
E-government systems allow citizens to request to use a government service and receive the service through the internet.
There are 4 types of e-government services:
- Government-to-Citizen (G2C) – this is generally information to citizens about healthcare, taxes and other governmental functions. It is becoming an increasingly efficient service in an Irish context. For example, the PAYE Anytime service allows citizens to review tax records and claim back overpaid taxes via their own personal online profile.
- Government-to-Business (G2B) – these generally involve the government passing on information about rules and regulations to businesses. They also may involve applying for licenses, grants etc.
- Government-to-Employee (G2E) – these are similar to G2C services but lean more towards civil servants.
- Government-to-Government (G2G) – these include transactions between national governmental bodies but also exist on an international level.
E-government may be costly to implement but in the long-run it leads to increased efficiencies and enables the government to decrease their number of administration staff. It is also important to citizens as it encourages them to interact with the government and it keeps in line with the increasing technology and efficiency they are experiencing in their everyday lives, such as in the workplace.
One of the trends in information systems in recent years is the increasing strength of customer/supplier intimacy. Organisations have been using information systems to increase loyalty and develop stronger relationships with customers. Having a strategy on customer/supplier intimacy makes customers and suppliers important stakeholders within the organisation and they will feel more valued.
With the increased use of the Internet, developing a strong relationship with both customers and suppliers is crucial for survival in such a competitive market where consumers have access to any information.
In relation to suppliers, information systems have enabled suppliers to have access to production schedules of the firm and so, they have more notice of when to have materials ready. On the customer side, information systems allow firms to keep track of preferences so they can make future recommendations to customers or they will not need to ask the same questions every time the customer uses their good/service. An example of this is in hotels when an information system can store information about preferred check-in times, tv programmes etc.
One of the trends in information systems is achieving competitive advantage through the use of information systems. Competitive advantage is something all companies seek to have. The framework of Porter’s Five Forces may be used to describe the forces that will impact on a company’s competitive advantage (http://hbr.org/hbrg-main/resources/images/article_assets/hbr/0801/R0801E_A.gif).
The business must align their IT with their business objectives by determining how the systems can help them to achieve goals and measure performance. In recent years businesses have realised how information systems can help them achieve lower costs and hence, lower prices by recording transactions and keeping track of inventory so there is less waste and service to customers is provided more quickly. (Essentials of Management Information Systems, Laudon).
Dell has successfully differentiated their product through the use of information systems. They use information systems to customise and personalise their products and this has given them a huge competitive advantage in the area of PCs and laptops.
Amazon is another business that has gained competitive advantage through information systems. They build a strong relationship with their customer by keeping a record of past purchases and this allows them to recommend new products that the customer may be interested in.
Businesses may gain huge competitive advantage through the use of information systems once they align their IT with the business objectives.
Information systems have evolved greatly over the past decade. One of the major trends in information systems is that of improved decision-making. This is particularly relevant for Management Information Systems.
Management Information Systems are used by middle management to monitor and control the business. They take reports from Transaction Processing Systems (TPS) and as a result they are generally summary-based so they provide the general information needed to make decisions. These systems are sub-divided into Decision Support Systems and Executive Information Systems. Both of these systems support non-routine decision making within an organisation by using internal data from TPS. It may provide information such as sales figures, competitors’ prices etc.
Using this information, managers may make decisions on planning, organising and controlling the business. Before MIS, managers had to collect data themselves and interpret it but with information systems like this the data is already processed and summarised so decision making is done quickly and more efficiently. (Managing the Digital Firm; Laudon)