Source: E-mail dt. 7 June 2012
Role of IT in Business
Dr. R. Karuppasamy M.Com., MBA, M.Phil., Ph.D., PLME
Director, Management Studies, SNS College of Technology, Coimbatore, Tamilnadu, India
Mr. C. Arul Venkadesh MBA, PGDPM (IRLL), (PhD)
Assistant Professor – Department of Management Sciences, CIET College, Coimbatore, Tamilnadu, India
It is widely acknowledged today that new technologies, in particular access to the Internet, tend to modify communication between the different players in the professional world, notably: relationships between the enterprise and its clients, the internal functioning of the enterprise, including enterprise-employee relationships, the relationship of the enterprise with its different partners and suppliers. The term "e-Business" therefore refers to the integration, within the company, of tools based on information and communication technologies (generally referred to as business software) to improve their functioning in order to create value for the enterprise, its clients, and its partners. E-Business no longer only applies to virtual companies (called click and mortar) all of whose activities are based on the Net, but also to traditional companies (called brick and mortar). The term e-Commerce (also called Electronic commerce), which is frequently mixed up with the term e-Business, as a matter of fact, only covers one aspect of e-Business, i.e. the use of an electronic support for the commercial relationship between a company and individuals. The purpose of this document is to present the different underlying "technologies" (in reality, organizational modes based on information and communication technologies) and their associated acronyms. Some common security concerns for e-Businesses include keeping business and customer information private and confidential, authenticity of data, and data integrity. Some of the methods of protecting e-business security and keeping information secure include physical security measures as well as data storage, data transmission, anti-virus software, firewalls, and encryption to list a few. While some use e-commerce and e-business interchangeably, they are distinct concepts. In e-commerce, information and communications technology (ICT) is used in nter-business or inter-organizational transactions (transactions between and among firms/organizations) and in business-to-consumer transactions (transactions between firms/organizations and individuals).In IT business world, ICT is used to enhance one’s business. It includes any process that a business organization (either a for-profit, governmental or non-profit entity) conducts over a computer-mediated network. A more comprehensive definition of e-business is: “The transformation of an organization’s processes to deliver additional customer value through the application of technologies, philosophies and computing paradigm of the new economy.”
Keywords: Internet, Communication technologies, Information, Information communication technologies, e-Commerce.
Information And Communication Technologies business commonly referred to as "eBusiness" or "e-business", or an internet business, may be defined as the application of information and communication technologies (ICT) in support of all the activities of business. Commerce constitutes the exchange of products and services between businesses, groups and individuals and can be seen as one of the essential activities of any business. Electronic commerce focuses on the use of ICT to enable the external activities and relationships of the business with individuals, groups and other businesses. Louis Gerstner, the former CEO of IBM, in his book, Who Says Elephants Can't Dance? Attributes the term "e-Business" to IBM's marketing and Internet teams in 1996. Electronic business methods enable companies to link their internal and external data processing systems more efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy the needs and expectations of their customers.
In practice, e-business is more than just e-commerce. While e-business refers to more strategic focus with an emphasis on the functions that occur using electronic capabilities, e-commerce is a subset of an overall e-business strategy. E-commerce seeks to add revenue streams using the World Wide Web or the Internet to build and enhance relationships with clients and partners and to improve efficiency using the Empty Vessel strategy. Often, e-commerce involves the application of knowledge management systems.
E-business involves business processes spanning the entire value chain: electronic purchasing and supply chain management, processing orders electronically, handling customer service, and cooperating with business partners. Special technical standards for e-business facilitate the exchange of data between companies. E-business software solutions allow the integration of intra and inter firm business processes. E-business can be conducted using the Web, the Internet, intranets, extranets, or some combination of these.
Basically, electronic commerce (EC) is the process of buying, transferring, or exchanging products, services, and/or information via computer networks, including the internet. EC can also be benefited from many perspective including business process, service, learning, collaborative, community. EC is often confused with e-business.
FOCUS OF INFORMATION TECHNOLOGY
Three primary processes are enhanced in IT:
1. Production processes, which include procurement, ordering and replenishment of stocks; processing of payments; electronic links with suppliers; and production control processes, among others;
2. Customer-focused processes, which include promotional and marketing efforts, selling over the Internet, processing of customers’ purchase orders and Payments, and customer support, among others; and
3. Internal management processes, which include employee services, training, internal information-sharing, video-conferencing, and recruiting. Electronic Applications enhance information flow between production and sales forces To improve sales force productivity. Workgroup communications and electronic publishing of internal business information are likewise made more efficient.
The Role of IT in Business-Led Data Governance
Despite companies now recognizing the importance of their enterprise data, they still have a difficult time effectively managing it as an asset. Some of those challenges arise from a lack of business involvement and sponsorship, an inability to identify data owners and encourage accountability, or a reluctance to share data. Although it is imperative for business to lead and sponsor data governance, it is equally important to align business and IT for organizations to fully benefit in a significant and persistent way from data management.
The importance of aligning business and IT is compounded by the trend to centralize information systems, resources and integration points. Many organizations are moving to centralize IT and with that recognize that data can also be managed centrally to achieve economies of scale, improve productivity, and effectively manage information. Consequently, the IT organization sees issues that span lines of business and geography, including enterprise data issues. As such, IT may be the first to recognize and often are the initial advocates of the need for data governance before the business. For example, IT can identify where data issues start in a source system and the changes that are made as data flows through different systems. However, the impact of the changes to the data is not always obvious to IT, nor is IT in a position to recommend changes to business processes to improve data quality either at the source or over its lifecycle. Challenges arise when it is time to assign resources to be accountable for data quality and fix data issues, which is precisely when IT needs to transfer ownership of data governance to the business while continuing with oversight and the essential role IT plays in data governance success.
This places these questions into context: What is the role of IT in business-led data governance? How can the IT organization work with the business to ensure their needs are being met and the data governance initiative is a success? In order to understand the role of the IT organization in data governance, let’s first look at the goals and objectives of the data governance organization.
Data Governance Organization Goals
The overarching goals of a data governance organization are to provide direction on the capture, collection, security, transfer, quality and management of data within the organization to:
Organizations go about achieving these goals and measuring and reporting results in different ways based on their unique approach to data governance. What is evident is that the business cannot achieve these goals without relying on and involving IT to deploy and manage the enabling technology and tools. At the same time, business needs to own the data governance program and the decisions concerning managing data as a corporate asset. IT and business must both play their requisite roles in data governance to avoid antagonistic or competitive impediments. Operating principles should be developed that define how the business and IT should work together in order to support collaboration. Moreover, the written guidelines should be agreed upon and communicated across and made available throughout the organization. While there are many ways to implement a data governance organization, some common roles include the Steering Committee, Data Governance Lead and the Data Governance Working Group – each comprised of representatives from both business and IT. For example, as a cross-functional business and IT team, the Data Governance Working Group are the subject matter experts who drive data management and data quality strategy, and execution for their respective subject and line of business areas.
The Role of IT in Data Governance
The IT organization’s mandate is to ensure that the future state of information and application architectures meet the needs of the data governance organization and are aligned to business goals and objectives. It ensures that the organization’s information technologies sustain and extend the data governance organization’s strategies and objectives while providing a consistent view of the end-to-end business processes. To meet its mandate, the IT organization must provide leadership, technical infrastructure and resources that collaborate with the business to identify data issues, provide alternatives and implement solutions. At a minimum, the IT organization should provide the following resources to the data governance organization in order to meet business stakeholder needs:
Data Custodians who work closely with the data stewards and data owners to implement data governance policies and data owner requirements, and who carry out the data delivery function The IT organization is also responsible and accountable for providing technology and technical infrastructure for the management, storage, access, security, navigation, movement and transformation of data. In this way, it implements the necessary systems to support and measure data governance requirements and data business processes. It also ensures that the data governance strategy aligns with the IT design methodology, development process methodology and best practices. By working together with business data stewards, the IT organization plays an important role in root cause analysis on data issues and building remediation plans. It is the role of the IT organization to measure, monitor and report on data quality and deliver stakeholder service based on service level agreements.
In order to successfully provision these services and support, the IT organization needs to understand why data governance is important to each business stakeholder, what the benefits are and how best to work together with the business. When the IT organization can clearly articulate the benefits for each business function, sponsorship and ownership is more easily achieved.The trend to centralize IT compounds the importance of articulating the role of IT in business-led data governance. Although IT may be the first to recognize and advocate for data governance, challenges arise when ownership transfers to the business. A comprehensive data governance strategy not only aligns business and IT to address data issues but also defines data ownership and policies, data quality processes, decision rights and escalation procedures. The IT organization plays a critical role in enabling data governance and contributes key resources to the data governance organization. The proper combination and collaboration of business and IT resources, skill sets and leadership is required to effectively carry out the data governance agenda.
IT SUBSETS AND MODELS
Applications can be divided into three categories:
Internal business systems:
Enterprise communication and collaboration:
Electronic Commerce - business-to-business electronic commerce (B2B) or business-to-consumer electronic commerce (b2c):
1. Internet shop
2. Supply chain management
3. Online marketing
4. Offline marketing
When organizations go online, they have to decide which e-business models best suit their goals. A business model is defined as the organization of product, service and information flows, and the source of revenues and benefits for suppliers and customers. The concept of e-business model is the same but used in the online presence. The following is a list of the currently most adopted e-business models such as:
Key Security Concerns within E-Business
Common Security Measures for E-Business Systems
The most common implementation of e business is as an additional, or in some cases primary, storefront. By selling products and services online, an e business is able to reach a much wider consumer base than any traditional brick-and-mortar store could ever hope for. This function of e business is referred to as ecommerce, and the terms are occasionally used interchangeably. An e business may also use the Internet to acquire wholesale products or supplies for in-house production. This facet of e business is sometimes referred to as eprocurement, and may offer businesses the opportunity to cut their costs dramatically. Even many ebusinesses which operate without an electronic storefront now use eprocurement as a way to better track and manage their purchasing.E-business modeling is a concept that has several components and can be designed based on different combinations of them. Furthermore, it is a concept that is vulnerable to changes as it is associated with technology, which is developing rapidly day by day. By con-ducting this research on 1) how the companies are managing changes in a competitive environments by means of adjusting their e-business models, and 2) if there are any compo-nent(s) of e-business model(s) that has more importance than the others for the competi-tiveness of the company, the thesis intends to define the change management procedures that the organizations involved in e-business are using, and to compare the components of the e-business models in order to find out if there is any component that is more important than the others for the competitiveness of the organization.
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