IT Value in Organizational Strategy
According to Goldstein, Katz and Olson (2003), IT value is not limited to software and hardware. In defining what is the IT value of an organization, the definition must cover the people involved in utilizing the advantage of technology, the efforts and expenditures incurred in adapting the different organizations to IT, and the various processes in the organizations. Krigsman (2010) argues that IT value cannot be achieved through cost control only. In addition, IT value can be a reached at by considering a number of things. Firstly, before assigning an expectation value to IT, the type of technology likely to be implemented has to be recognized first. The expectation value of technology has to be linked to the purpose to which it is going to serve while still considering the magnitude of investment in a technology (Goldstein, Katz, and Olson, 2003). Secondly, in the process achieving IT value in an organization, the process of realizing the value has to take into account factors such as cost of retraining staff to operate or use the technology. Thus, the value of IT cannot be limited to the enhancement of decision making process, but also to the user of the information and the use of information.
Goldstein, Katz, and Olson (2003) suggest that evaluation of IT value in an organization can be done at three levels. These are the strategic level, IT organization level and the project level. At the strategic level, it is important t to ensure a linkage between the organization’s goals and the IT plan. Consequently, IT organization can be evaluated efficiently if certain set of standards or metrics are set for evaluation of the effectiveness of the IT organization. At the project level, the IT leaders need to work together with the business leaders in an organization to ensure to clearly attainment of the potential benefits of the use of technology in accomplishing the organization’s goals. Malik (2005) suggests that tactical plans should be prepared to be the last after the strategic information systems are prepared. The tactical plans are developed based on the strategic plans in relation to the information technology being used to accomplish tasks in the organization. This will allow the development of new information systems in the organization.
Basualdo (2010) highlights a number of ways and ideas that CIOs can use to create and communicate IT value in an organization. In an organization, issuing of frequent reports stipulating the value, which IT has contributed in achieving the organization’s objectives, is one of the ways IT value in an organization can be recognized. In addition, IT managers can effectively communicate the use of IT by preparing presentations of how IT has contributed to the organization and how it can further be used to attain organization goals. Another way for communicating IT value as a strategy in an organization is by the IT managers participating in management committees. Additionally, they can make contributions on the efficient use IT as a strategy to achieve the organization goals. Furthermore, value can be added to by redesigning customer processes. Further, IT value can be increased by developing working relationships between the IT personnel and the business personnel in an organization. Additionally, comparisons between IT in other organizations regarding personnel, expenses and investments can assist in increasing the IT value in an organization in an effort to attain organizational objectives. Slater (2011) suggests that a working relationship between IT, business, and security personnel in an organization can result to the formulation of a plan that takes into account the most crucial aspects of the organization. This comes in handy when dealing with unexpected disasters.
According to Croteau and Bergeron (2001), information technology plays a major role within organizations. In addition, business strategies are influenced by the strategic information systems that are in use currently. These information systems become strategic when used innovatively. Aligning of the organizational goals and objectives with the information systems objectives influences organization’s performance largely.
Organizations are employing information technology as a way to enhance their competitive advantage in the business industry. For instance, many hospitals are considering the implementation of the use of electronic health recording systems that will assist them in addressing challenges in the health care industry. For this new technology to be successful, a linkage between communication, workflow structures, values and beliefs, and measurement systems need to be incorporated in the use of the information technology. Hospitals are incorporating the use of new technologies that provide better integration of online payment options, web-enabled functionality, and the clinical information systems. Additionally, implementation of information technology in an organization becomes crucial where the values and beliefs of the organization is innovation. Implementation of information technologies in organizations such the hospitals will allow the top-level management to monitor the activities of the organization on a real-time basis. Thus, top-level management can be able to act on any needed change or problems that may arise in running of the hospital or organization.
In the health care industry, Partners HealthCare is establishing a business intelligence center, which provides a business intelligence platform and business-related roles and responsibilities (Glaser and Salzberg, 2011). In addition, the business intelligence platform is being used to access, collect, and analyze data about organization operations and activities. Use of information technologies allows for ease of acquiring data for the main transactions that take place within the organization. These include outpatient registration, accounts receivable, and payroll.
Policies usually provide a guideline for decision making through which the formulation of the company strategies is linked with implementation of the strategies. Therefore, an IT policy governs crucial decisions that affect how decisions are made by the management in an organization. The use of IT technology is normally considered to be an investment as long as it will provide profits to cater for its costs. Poor choice of technology may result to the organization incurring losses.
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