Economics in the Information Technology (IT) Industry

Economics in the IT Industry -- Additional Four Pages for Your Essay

Making Information Technologies a Competitive Strength

The pace and depth of innovation continues to accelerate in all sectors of IT. Across all sectors, enterprise and organizations that choose to automate their core business processes using IT systems and platforms are gaining the greatest impact of all however. Manufacturing and services companies are adopting Enterprise Resource Planning (ERP) systems to streamline their supply chain, sourcing, procurement, production and service strategies (Sternad, Gradisar, Bobek, 1511). ERP systems are proving to be extremely valuable for these organizations as they strive to create a more unified series of business strategies across all their divisions. IT has emerged as an agile platform to support business' growth over the long-term as a result.

IT investments are also now entirely tied to business objectives and strategies as well. This has made IT critical form any companies to gain the information and knowledge they need in order to keep producing their product, serving customers, managing pricing and production in a synchronized way. Globalization, continued economic risk and uncertainty, and the rapidly increasing pace of new product development across many diverse industries is also making IT a critical asset for managing a business. In short, IT has become the dial tone in many enterprises, creating the information and knowledge necessary to manage a diverse set of product divisions, services, distribution channels and new product development programs.

IT is also driving the development of entirely new approaches to unifying the enterprise as well. The growth of Service Oriented Architectures (SOA) and Web Services to streamline the most critical business processes enterprises continue to also show the value of IT as well.

Where Web Services have shown the greatest value and contribution of IT is in streamlining the supply chain, production and services processes with what customers expect (Lee, Kwon, Lee, Park, Hong, 2193). IT is progressing at such a rapid pace in enterprises that it is revolutionizing how databases are used to better attract, sell and serve customers, while also making large-scale systems more intuitive and easier to use (Sternad, Gradisar, Bobek, 1511). The role of Web Services will continue to accelerate and be used for capturing, processing, producing and delivering products across globally-based production centers and manufacturing plants. As SOA platforms support Web Services and allow for cross-production center transactions and workflows, companies are investing heavily in this area of IT to drive down costs and increase response times (Lee, Kwon, Lee, Park, Hong, 2193). The future of IT's use in enterprises will continue to support complex transaction workflows while making the use of these systems intuitive and easily learned by everyone who is reliant on them (Sternad, Gradisar, Bobek, 1511). IT is the new dial tone for enterprises, and is going to accelerate business sales, production, services and new product development given its ability to unify all aspects of a business model. SOA and Web Services are case in point where this is occurring today (Lee, Kwon, Lee, Park, Hong, 2193). The benefits of IT in large-scale enterprises are delivering far beyond their costs, leading many Chief Information Officers to consider increased investments in new applications that can unify their companies and deliver strong Return on Investment (ROI). As companies become more focused on competing with knowledge over just production capacity or expertise, IT will continue to be an essential element in their transition to services-based business models as well.

How Cloud Computing is Revolutionizing Information Technologies

The rapid development of Cloud Computing technologies and platforms is one of the highest growth areas of IT development and innovation today. Cloud Computing is pervasive and used for supporting a myriad of applications, as diverse as Google and Yahoo Mail to sophisticated Customer Relationship Management (CRM) applications including Salesforce.com Oracle OnDemand and others who all run entirely over the Internet. Cloud Computing is an area where IT is showing how effectively it can be used as a technology base for rapidly reducing costs while increasing performance and value (Han, 205). In addition to the cost advantage of Cloud Computing, applications developed on it as a platform are more easily modified and tested with customers for feedback, ensuring higher levels of adoption relative to traditional software. Cloud Computing applications are also beginning to become more integrated to databases, enterprise systems and order management platforms and systems, as evidenced by how Amazon.com and other major retailers can quickly take an order for an individual item and ship it within hours from warehouses and distribution centers. Cloud Computing is also revolutionizing how new software companies build and market their products, as the time to program, test and launch new applications is nearly 60% faster than traditional approaches used with licensed, on-premise software (Han, 199). Software-as-a-Service (SaaS), a major segment of cloud computing, is also revolutionizing how IT is used by consumers and businesses. SaaS is making it possible for businesses to more rapidly role out new applications to their sales forces, channel partners, distributors and dealers (Benlian, Hess, 232). SaaS is also making it possible for companies to better track their marketing strategies and pricing programs, getting insights into what is working and why.