Dependence of Organizations on the Analysis Of Large Databases And Other IT Resources To Formulate Basic Strategy
With the far reaching capabilities of the Internet and information technology, boundaries across the world are disappearing fast and the globalization process has taken deep root, thereby increasing the competition between world players for a better slice of the market for their products. Large corporations are leaving no stone unturned in their efforts to up their ante and position themselves at the head of the table, ensuring that their competition is safely behind them by at least 3 to 4 steps.
In this scenario, decision making attains critical status, with managers jockeying to evaluate alternatives to arrive at quick and successful decisions within minutes. When we view the creation of "big data," it is cumulatively all the data that is made available to the company by its various information technology initiatives. Big Data is certainly important to the company provided it is segregated and the useful information fed to the management with the help of analytics. Now, armed with information on the past, present and the option for the future, managers are able to rely less on their intuition and take faster, more calculative and qualitative decisions with less dependence on the risk factor, which was an erstwhile impediment. Moreover, when decisions are based on iretractable data, there is a better chance for rational thinking and decision making and are less prone to be affected by personal factors, peer pressure, and organizational situations (Webster, 2011).
1) Begin this paper by stating your position on this question clearly and concisely - take one or the other position (either for or against formality), but not both!
On the subject of how much an organization should depend on large databases and IT sources to formulate their basic strategy, having considered all the pros and cons thoroughly, I am of the firm opinion that large databases, if used effectively along with IT sources will contribute greatly to the formulation of the basic strategies of the company.
Basically, the term "big data" refers to the volumes and unstructured/semistructured data that is created by the various IT initiatives of the company. Big data are normally quantified in Petabytes and Exabytes and can be very expensive in terms of data storage. Data analytics are used for cloud computing in a MapReduce framework to be able to distribute meaningful information to the computer to feed the management to assist them to take measured decisions (Webster, 2011).
2) Citing appropriate sources, present the reasons why you take this position. Be sure to make the most effective case you can.
Today's businesses are highly competitive and need every bit of support to formulate strategies to shape the successful future of their company.
Frontline managers are always looking for input information to manage revenues, margins and costs in a more proficient and advantageous manner. More consistency and better coordination between upper and lower level managers are achieved when information is free flowing throughout the organization. Most organizations are now using the decision support system (DSS) software supported by Internet-hosted databases and user-friendly query tools, to analyze the raw "big data" and convert them into quality information for use by the decision makers using analytical and report-writing features. While DSS slices and dices data that may be novel and complex, into understandable chunks to facilitate shared consideration of multiple criteria, enterprise resource planning (ERP) enhances productivity by speeding up routine operations (Nobel, 2010).
Basically, there are two types of information technology - Information-based systems and communication-based systems. Information-based systems are like the Enterprise Resource Planning (ERP) software which will contribute to pushing decision making down the ladder to the managers at the operating level. The information based IT system does not concentrate on pushing technology, rather, it encourages the CEO to trust his senior managers and decentralize his authority down the ladder. Moreover, this system also ensures that acquisition of information at lower levels is made easy, speeding up the decentralization of the decision making process (Nobel, 2010).
One big error that many organizations make is that they fail to clearly understand the disparities between the information based and communication-based systems, lumping both of them into one single category of huge, heterogeneous set of technologies which support strategic growth and also help in warding off the challenges posed by the ever vigilant competition (Nobel, 2010).
The advantages of analytical databases on various facets of the organization
Organization And Productivity
When discussing matters of organization and productivity, organizations would do well to consider information-based systems and communication-based systems as completely different if they are looking for charting strategies for progress. Many organizations have been erstwhile clubbing these two heads under one category as "an aggregate homogeneous capital stock" and have not been able to make much headway in terms of organizational enhancement, cost effectiveness or customer satisfaction (Nobel, 2010).
Wage and labor
The effect of the two branches of IT technology, information based and communication-based has a direct effect on the labor management strategies of the company, as they can pull in different directions, with the communication-based system affecting waged distribution in a negative manner (Nobel, 2010).
Facilitates Decisions On Capital Investment, Employment And New Products
The big data, when analyzed by DSS and provided to the top and lower management through the information-based system of IT technology provides sufficient information and options to enable the managers either at the top level or at the decentralized level to take effective decision on subjects like capital investment, new employment and new product plans. Further, the Enterprise Resource Planning (ERP) software facilitates to disseminate the information to the various operating units, thereby rendering the decision making process more purposeful and speedy. For the decisions pertaining to production, the information, basically originating from the "big data," is used to formulate the tasks necessary to achieve the goals and decide how to pace the process. Computer Aided Design (CAD) and Computer Aided Manufacturing (CAM) software are utilized in decision making. One clear conclusion seems to be emerging and that is the information-based system provides sufficient disseminated information from the big data, making it easier for all concerned to draw their required information from the pool, leading to more and more decentralization with ERP and CAD/CAM systems coming to the aid of the plant managers to take decision independent of their headquarters (Nobel, 2010).
The effect of ERP, CAD/CAM on Decentralization and Progress
Increase in penetration of ERP levels enhances plant manager autonomy in the organizations and as an extension, CAD/CAM utilization seemed to give a better level of autonomy to the workers as well. Various research done on the application of information-based systems across the world have shown that the results were similar in most industries in the world (Nobel, 2010).
The information derived from analytics goes a long way to fortify the strategic planning of the organization. The information-based system provides sufficient data in disseminated form to the planners to formulate strategies for the company (Hayles, 2007).
a) Planning aligns with business strategies coordinated across the company to ensure that technology efforts are business driven.
b) Planning can take advantage of the standardizations across the company and also the corporate policies, to save precious money for the organization.
c) By implementing architectural principles using single research groups within the firm, duplication can be considerably reduced or even eliminated.
d) Planning also helps to direct investments in technology and manpower, aimed at serving customers better and staying ahead of the competition.
The Smartest Organizations -- The Path From Insight To Value
In principle it is said that the smartest organizations are using analytics to transform information from big data into palatable insights and then move into action. This is the way forward in using unlimited data to the advantage of the modern organizations. Organizations are maximizing technology to be able to collect more valuable data all the time for the analytics to break them down for their benefit, so as to know clearly what is happening in the present, what will happened in the near future and the optimal action required for best results (LaValle, et al. 2010).
An organization's analytic prowess have been classified into three distinct types. They are (LaValle, et al. 2010):
1) Aspirational: These are furthest from achieving the desired analytic goals and have a few of the building blocks required which are people, process or tools to proceed on analytic search.
2) Experienced: These are organizations who are slowly changing from the aspiration stage into the transformed change by realizing the need to incorporate and implement analytics.
3) Transformed: These organizations, with sufficient experience, use analytics as a competitive differentiator to organize people, process and tools and drive customer profitability by automating several of their operations through effective use of analytic inputs.