Term Paper: Business Information Technology

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[. . .] This can make it difficult for the small business to compete, making it even more important to operate efficiently.

Information technology can increase a business's efficiency in three ways. Firstly, a control system as discussed in the previous section can give a business the opportunity to identify opportunities for improvement and make changes to increase efficiency. Secondly, information technology can be used to work with other businesses, including partners, suppliers, and business providers. Finally, information technology can help a business operate more efficiently internally. These last two aspects relate especially to the ability to communicate using Information technology.

In regards to external communication, information technology gives a business the opportunity to work with anyone, regardless of location. The small business can communicate quickly and cheaply via email with anyone in the world. This gives the small business the option of seeking partners, suppliers, and service providers in any location. With the use of teleconferencing technology, a small business can easily work with a partner or even a division in another location, without this being a major cost. This can be a means of a small business gaining the ability to locate resources from around the world. This benefit is one that many multinational corporations have. With the use of information technology, the small business can gain the same advantage.

The use of email can also allow everyone in the company to communicate easily. For more formal communications, there is often a requirement for email to flow through managers. With the use of email, a lower level employee can easily contact someone in another company directly. This can create the kind of relationship building and efficiency that a small business needs.

Internally, the use of information technology tends to connect the workplace. This can occur because all employees are able to communicate quickly and easily via email. This ability tends to result in departments being less separated from each other. Since a business is a set of functions all working to achieve the same overall goal, this interconnectedness can be a major advantage. For example, consider a large company where marketing and production staff rarely contact each other. Marketing may have information available that tells them about a gap in the market. Production may be aware that they could easily and cheaply produce the product to fill that gap. Without effective communication between the two functions, production does not know the need exists and therefore, the gap never gets filled. For a small business, the communication between departments can allow the company to recognize opportunities and take advantage of them. In addition, departments working together can often work in ways that produce greater efficiencies. Overall, this can help a small business operate more efficiently than its larger competitors.

Reaching Customers

For any business, the final success depends on the ability to meet the needs of customers. If customers are being provided with what they need, how they need it, and for a price that suits them, the business will succeed. Information technology can assist in meeting customer's needs by building relationships with customers and by making the products or services accessible to customers.

Building relationships with customers has become a major focus for many businesses. Gronroos notes that marketing is no longer about just trying to sell a product, but also about the company building a relationship with the customer. Kotler further describes this trend saying relationship marking involves "providing excellent real-time customer service by developing a relationship with each valued customer through the effective use of individual account information." The online bookstore Amazon is a good example of how this relationship marketing works. Once you purchase an item from Amazon, or even search for a topic, the site remembers your interests and recommends books of that type. The best thing for Amazon is that this process is tailored to every individual customer, but managed automatically. In short, this is automatic yet focused advertising. As Gronroos says, "a shift is clearly taking place from marketing to anonymous masses of customer, to developing and managing relationships with more or less well-known or at least somehow identified customers." Information technology becomes important because it is the tool that allows the business to identify the individual. In Amazon's case, information technology remembers the site user, remembers their interests, and automatically tailors site content to the customer. For other businesses, information technology is used to create a history of each customer. This history is then available to employees so each customer can be treated as an individual. For the small business, such a system can help provide the kind of personal services that many customers expect from a smaller business. In saying this, it should be remembered that many customers actually reject the larger businesses and choose to go to a small business because they specifically want personal service. Information technology can help ensure the small business provides this personal service.

The other important benefit that information technology provides is that it helps make the products or services available to customers. In some cases, a company could make their products available via Internet sales. This could allow a company to easily and cheaply expand their market. In other cases, actual sales via the Internet may not be suitable. However, the Internet still offers a valuable marketing tool by making product or service information available to consumers. Consumers are increasingly using the Internet to research products and services. Information technology can be applied by having an informative web site that provides potential customers with all the information they need. In addition, information technology can help communicate with both current and future customers. For example, a web site could be used for product support so consumers can ask for information or have their questions answered. This systems are often more convenient for customers, as filling in a form to ask for support is quicker for a customer than phoning and having to wait to speak to a sales representative. This convenience for the customer is the major advantage of providing information services via the Internet and is something many small businesses can effectively use. This is especially important if the small business has low staff levels, since an employee can answer replies at a suitable time and not have to be available for phone calls during all business hours.

Human Resources

Human resources is the final area where information technology can be effectively used by the small business. This applies to training employees, empowering employees, and controlling employees.

Training is a major issue in many businesses and is especially relevant because the business world changes so rapidly. This creates a need for employees to constantly be trained so that the company continues to move forward. The major problem with training is the time it takes employees, the inconvenience of having to train at certain times, and the problems that many individuals have with classroom-based learning. Information technology can allow a company to tailor training programs so the employees are only learning what they need to know. The ability to be specific about the skills or knowledge that need to be learned reduces training time. Information technology also allows training to take place via interactive methods, including teleconferencing. This can produce a better output than having employees learn simply from books or manuals.

Information technology also helps empower employees, where empowerment refers to giving employees more responsibility to make their own decisions and manage their own tasks. In his book Business @ The Speed of Thought, Bill Gates writes about connectivity and says that information technology "creates a new universal space for sharing, collaboration and commerce." In many small businesses, this connectivity arises because all information is contained on a network and becomes available to everyone. This means that an employee in one department has available to them information from all other departments. Having access then gives employees the opportunity to understand more about the business as a whole and to manage their own jobs better. This can be compared to a workplace where an individual wanting to know something would have to ask their manager, who would then have to ask the manager of another department, who would then have to find the information. This is a slow process and usually means that employees at lower levels know little. With information technology giving people access to information, this problem is reduced. With more information, people are then empowered and able to do more. This is especially beneficial to the small business, which is often operating with a small staff. In short, why have an employee have to ask a manager to complete a task, when the employee could just complete the task themselves? Having the employee complete the task themselves increases efficiency and allows managers to make better use of their time. Overall, this increases the efficiency of the business by making the best use of all employees.

The final area where information technology assists Human Resources is in controlling employees. A… [END OF PREVIEW]

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Business Information Technology.  (2004, February 23).  Retrieved July 18, 2019, from https://www.essaytown.com/subjects/paper/business-information-technology/8379707

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"Business Information Technology."  Essaytown.com.  February 23, 2004.  Accessed July 18, 2019.