Effect of Information Technology on Business Management (Research Paper Sample)

Effect of information technology on business management
Most of the industries today employ information technology in their day to day operation in industries. Various effects of the use of information technology is evident in the society today. The Information Technology (IT) group is often described as having its own culture different from that of the business, which can result in different codes of behavior (Ward and Peppard, 1996; Ward and Griffiths, 1996). Using the concept of culture as a basis for understanding differences between groups provides a foundation for understanding the generation of conflict (Dubinskas, 1992; Schein 1996). Through awareness by both parties of IT culture and the effect that this culture has on the IT-business relationship, an effective IT-business partnership can be established, thus promoting a healthier relationship and a more desirable work environment that will ultimately lead to greater organizational success. It is important for organizations to understand and develop relationships between individuals, groups, and across organizational boundaries for effective operation (Musgrave and Anniss, 1996; Robbins, 1998; Ivancevich and Matteson, 1999).
An extensive review of related literature preempted development of a research model for assessing the effect of the IT on the business management. The case study considered in this research included an analysis of interview transcripts from 11 IT professionals and 21 business professionals in Four Kenyan Business organizations. Findings include compelling insights into the effect of the IT culture on the IT-business relationship.
Before proceeding further, it is necessary to distinguish between IT and business professionals. For the purpose of this research, IT professionals are regarded as those who make IT work (Markus and Bjorn-Andersen, 1987; Grindley, 1995). This broad category includes CIOs, information systems managers, systems analysts, designers, programmers, database administrators, and external specialists such as hardware vendors and manufacturers, software firms, and consultants (Laudon and Laudon, 2000). Business professionals are regarded as the remaining organizational members, specifically, "those who use IT" (Grindley, 1995). Thus, the expression "IT-business relationship" is used to indicate the relationship between IT professionals and business professionals.
Review of Existing Literature
According to European Commission, small- to medium sized enterprises (SMEs) are those companies which have the number of employees up to 250 people and a maximum annual turnover of 50 million euro. The importance of SMEs today is undeniable both for developed and developing countries. By providing millions of work places, the institute of SMEs serves as the primary mean of sustainable industrial and social diversification of the society, thus addressing one of the main drivers of economic development in the majority of the countries. However, such phenomena as globalization, the internationalization of domestic markets, the global economic crisis, the volatility of financial markets, declining investment, rapidly changing consumer demand - have increased pressure on SMEs and encourage them to seek the ways for survival and development in the modern business environment. How do then SMEs find these ways, struggle with the above mentioned problems?
The undoubted factor which indicates the improvement of the competitiveness of most enterprises is the usage of the result of scientific and technological progress in business, namely information and communication technologies (ICT). The access of SMEs to ICT increases the efficiency of business and of the world economy in general, being a factor within the value chain of the product. The usage of ICT on the enterprise is determined by different management approaches and the methodology of its implementation and usage. That is the main reason why ICT should be investigated in conjunction with all the business processes implemented on the enterprise.
The global market for ICT-enabled business process management (BPM) which incorporate all sorts of communications, software, web applications and services, ERP-systems, etc. was estimated in 2008 at 1.8 billion dollars and is expected to grow up to 6.2 billion dollars in 2015. At the same time, nowadays the usage of ICT in business process management for SMEs in developing countries is quite low. Consequently, additional studies have to be conducted on the usage and impact of ICT on SMEs and on the development of the concept of customized BPM which takes into account the specificity of small-and medium-sized businesses in developing countries. Herewith, among the developing countries with the greatest potential for ICT development one can distinguish the BRICS countries: Brazil, Russia, India, China and South Africa. The development of small and medium businesses is one of the main tasks both of these states and the other countries in the world. The above arguments and the facts became the prerequisites for the analysis of existing practices of ICT usage and its impact on business process management in SMEs.
Previous research in the discipline of IT has been criticized for the lack of regard given to existing theory (Robey and Zmud, 1992). Existing theory should be used for three reasons. First, theory offers general predictions that can be tested. Second, communication between researchers can be improved by offering a standard language to describe complex subjects. Third, IT researchers must develop theoretically sound research projects rather than just presenting descriptive results. Additionally, IT research has been criticized for narrowly and economically focusing on investigating technology, design methods, computers, implementation, production tools, and communication without adequate regard to the people factors involved (More, 1990; Avison an...