EFFECTS OF CHANGES IN INFORMATION TECHNOLOGY ON MANAGEMENT AND ORGANIZATIONAL STRUCTURE

Information technology (IT) is basically the application of computers(softwares and hardwares) and telecommunications equipment to store, retrieve, transmit and manipulate data, often in the context of a business or other enterprise. Different forms of changes in information technology will have corresponding impacts on all organizations. There will be a need for new types of managerial, diplomatic, and social skills and a concomitant need for a new type of decision making process that will not be accommodated by existing organizational structures.

Technological change will force changes in basic managerial functions. There will be increased responsibility on management for organization outcomes leading to added emphasis on planning, decision making, control, and coordination. These will often rely on computer-based management science techniques which demand a higher intellectual capability of managers. This will produce strain on managers and other individuals, potentially affecting morale, productivity, and output. IT significantly affects strategic options and creates opportunities and issues that managers need to address in many aspects of their business.

Key impacts of information technology improvement on organization and Management

1.Business strategy

IT creates new opportunities for innovation in products and services. Services which used to be delivered in person can now be delivered over networks. Among the key levers are:

• resequencing: including parallel processing of data-bases
• simultaneity: making information instantly available in several systems
• time extension: offering 24 hour a day; 365 days a year service
• portability: taking service and products closer to the user
• re-usability: using information captured for one purpose (e.g. transactions), and using for other purposes (e.g. customer targeting)

2.Organization Culture
Newer types of IT such as electronic mail and groupware are creating significant changes in the way that information flows around group ware, and between them and their customers and suppliers.

3.Organization Structures
For many years it has been argued that IT will enable larger spans of control and the flattening of group ware. This has at last happened, but due as much to initiatives like BPR (business process re-engineering) and the drive to cut costs.

4.Management Processes
IT is rapidly entering the era where it supports unstructured management processes as well as highly routinised business processes.

5.Work
IT is dramatically changing the nature of professional work. There are few offices where professional do not make use of personal computers, and in many jobs involving extensive information and knowledge based work, the use of the computer is often a core activity.

6.The Workplace
The way in which IT diminishes the effect of distance means that it creates a variety of options for reorganizing the workplace.

Implications for Management

These IT impacts have implications for managers of all organizational functions. Among the most important are:

• Understanding the Changing Context of IT - they are required to adapt quickly to changes. Business managers need to be able to see developments in the context of the wider environment in which their business operates.
• Keeping abreast of Developments - not necessarily about the details of the technologies, but about the business impacts. For instance; managers can be adequately informed by meeting suppliers and business consultants, attending conferences, or receiving customized presentations from independent analysts.
• Integrating IT and Business Planning - the IT strategy should support the business strategy and vice versa. This may need new planning processes, hybrid teams, and an increased incorporation of the levers into business plans.
• Addressing Culture Issues - the dimensions of existing and desired culture need to be understood and how proposed systems will affect them. In particular attention needs to be paid to the organization's information culture.
• Experimenting with new Structures - using IT to remove some of the limitations of hierarchy and to encourage the development of innovative teams, using experts located in different functions and places. Managing dispersed teams is challenging but rewarding.
• Ensuring that new systems are customized change proof - our studies have shown many new systems to be developed around existing customized structures and responsibilities. Since these change very rapidly, new systems should be built with organised customized flexibility and change in mind.
• Developing New Skills - more of tomorrow's managers will need to become hybrid managers, combining the knowledge and skills of general management, their own discipline and IT.
• Using IT as a management tool - initiating personal use of IT into every day work. This should include use of decision support tools, groupware, knowledge management solutions and exploiting the Internet.
• Exploiting Information as a Strategic Asset - using the techniques of Information Resources Management to develop it as a valuable resource for internal use, for adding value to customer activities or services, or for creating saleable products.
• Introducing Knowledge Management and Innovation - going beyond information to developing networks of knowledge experts who evolve the organization's knowledge assets to create extra capabilities and value.
• Reorganizing the Workplace - by introducing flexible working and telework. The business benefits of this in terms of productivity and cost savings are such that there are many personal benefits to be achieved by a successful implementation.