Strategic Information System (SIS) Essay

Introduction

As Barlow (1990) provides, SIS exercise should align with SIS objectives for the realisation of business strategic goals. IS has enabled coordination and management and lack of experience and resources required to ensure implementation pose challenges to a company planning to operate globally. Additionally, overall success of an integrated business objective is stated by Pant and Hsu (1995) to “depend upon the organisation structure, the level of IT experience within the company and the availability of information resources” (p.17).

This therefore implies that IS is indeed a management function and requires the integration of both impact and aligned views of innovative and competitive intelligence of an organisation. It has also increased the realisation of IS application to a firm’s strategic activities enabling efficiency while improving business performances.

When applied correctly, information technology can serve as a competitive intelligence in business operations. Technology-enabled business solutions have facilitated globalisation of business operations through retail and wholesale transactions such as global banking.

Web-based electronic banking solutions on the other hand have eliminated time and distance barriers by attracting worldwide markets. As a control and coordinative function, IT has facilitated financial and human resources services increasing the global nature of interdependent to information system which in turn enhances business strategy.

Strategic importance of information in organisations

Strategic information system (SIS) is increasingly becoming important integration unit in many business application services. This approach to strategy formation has influenced the forces will see today in global markets. It is especially true that SIS has influenced strategic planning and is constantly improving company operations in significant ways.

Its contribution and impacts to organizations has sufficiently supported the new role of information system and technology which captures and challenges while improving performance and realising gains of its investment. SIS is a practice that ted to regard application regimes such as planning, connecting structurally to different access points with multiple applications and directly to the information system to arrive at consistent economic evaluation of information system investment (Rockart 1979).

Pant and Hsu (1995) define SIS as “the analysis of a corporation’s information and processes using businesses information models together with the evaluation of risk, current needs and requirements” (p.1). In this regard, SIS should be generally understood as a critical requirement to corporate data processing and development of computer-based system that response to company’s needs.

Consequently, realisation of the need to make information system importance to organisation has become practical bringing with it an intertwined relationship between information system function and corporate strategy (Pavri and & Ang 1995; Beath and Orlikowski 1994; Porter and Miller 1985).

Thought to be particularly important to today’s competitive markets, SIS applications have been widely used as backroom operation in first line support services to deal with day to day mundane tasks leaving office operations to concentrate on strategic planning (Lederer1992). SIS planning begins with identification of needs followed by strategic implementation that begins with what Pant and Hsu (1995) states as “objectives, priorities, and authorisation of information system projects need to be formalised” (p.1).

In other words, beginning with simple tasks then slowly progressing to complex information and support system levels requires as stated in Pant and Hsu (1995) article as “identification of system development plan that identifies specific projects slated for the future are required, priorities for each project and for resources, general procedures and constraints for each application area” (p.2).

In other words, SIS plans to integrate into the corporate system should be specific and adequate to allow understanding of each application, and to understand its procedural order of development.

This simply means that organisations should provide a new checklist to ensure most critical priorities are met first. King (1995) article on SIS argued that “a strategic capability architecture- a flexible and continuous improving infrastructure of organisation capabilities- is the primary basis for a company’s sustainable competitive advantage” (p.67). He stresses on the need for continuous updating and improving of information system application to align with firm’s strategic objectives against its capabilities.

Also defined by Pant and Hsu (1995) as “a networked, integrated system, available and supportive to users, relate to business strategy, and enable the business-business driven” (p.4), it is indeed true that SIS is a prerequisite of management functions and its application is critical to company’s future success. Corporate functions align with information use and needs with the strategic direction of a company increase strategic importance of information technologies (Battaglia 1991; Hsu and Rattner 1993).

As strategically used in office applications, information technology has the capacity to drive development of corporate information system ensuring economic evaluations of information system investment reduces time and space barriers. Deliverance mechanisms of information technology projects specifically rely on aspects such as computer integrated manufacturing such as electronic data interchange and mails as well as providing links to suppliers.

In factory application, information technology has been critical in providing future strategic sustainment for existing businesses. This application is evident in employee data base and maintenance of scheduling. It has also had the strongest influence on support system of an organisation by helping improve management and performance in areas such as recording and payroll.

Applied as a strategic and competitive integrative tool, it has been without doubt that information technology has enabled businesses link to each other while pursuing their opportunities and goals.

As an agent-based programming, SIS has been progressively used to support breakthrough ideas in business processes. One business week article presented in The Technology Payoff (1993) argued that information system provides business strategies for management and users while providing coalition systems applicable for entrepreneurial use in innovation and bottom-up development. Deeply imbedded in business processes, SIS has been evidenced to bring about agility, quality and productivity.

Applied strategically to cater for the ever rising organisation demands that strive to serve business goals and gain competitive advantage. The Technology Payoff (1993) article provide that information system has indeed helped many businesses in meeting their data processing needs when it indicated that “throughout the 1980s US businesses invested a staggering $1 trillion in the information tech logy”(p.57). This statement clarifies the importance of IS in adding vale to an organisation.

Merely as a tool for integrating business strategies, SIS is indeed a management function that helps identify weakest areas in organisation and providing the best management systems. Understanding IS practice is important in helping an organisation maximise the return on its information technology investment while meeting its data processing needs.

On turning on the question of literacy, integration of information technology in management functions has automated routine tasks without changing business processes, resulting to high productivity. It is also plausible to argue that application of IS has hugely reduced organisation operation expenses by flattening an organisation and adding value to the existing processes.

Other studies by The Technology Payoff (1993) claim “the return on investment in information system averaged to 54% for manufacturing and 68% for all businesses surveyed” (p.58). The article further adds “technology impacts on re-defining, re-engineering businesses and is likely to continue and it’s expected that IT will play increasingly important roles in future” (p.58).

Pant et al (1994) on the other hand points out that “the emerging vision of virtual corporations will become a reality only if it is rooted in new visionary information technology” (p.1). This article emphasises the future strategic importance of SIS when it further stated “it is information technology alone which will carve multiple ‘virtual corporations’ simultaneously out of the same physical resources and adopt them without having to change the actual organisation” (p.1).

This shows that IT has over the years achieved coherence and integration offering unprecedented possibilities, which have turned into strategic planning. Keen (1993) realistically posits that “organisations not planning for strategic information system may fail to spot the business implications of competitors use of information technology until it is too late for them to react” (p.1). It is to this we conclude that information technology changes the basics of competition in an industry, and without it, many businesses will be distinct.

While SIS is generally recognised as a key to economic resource, companies are increasingly considering it as one of the firm’s most valuable source of knowledge and important assets comparable to capital and human resources. Since, information is very critical to post-industrial age.

The changing world of work is changing to correspond with the ever-changing nature of science and technology- which means that the mainstreams of organisations are driven by technical and strategic functions. IT plays a crucial role in enabling critical operations such as banking and retailing transactions and overall performances come to operation.

A perfect example of this is Wal-Mart Stores as quoted by Sheth (1994) to provide “a computerised inventory control system that electronically orders merchandise from supplies and maintain order in the warehouse” (p.3). This device uses the Wal-Mart Satellite Network (WSN) that enables two way satellite communications between networks. He further provides Apple and Hewlett-Packard computers as other examples of electronics that are integrated with information system.

The second dimension of strategic importance of information in management functions is that of centralising strategic operations. Involved with leading the way in the organisation operates, IT has immensely gained recognition in top management functions. General Motors provides another example on the use of computers as communicative strategic resource enabling it acquire EDS and Hughes.

Gaining top management attention, I S has enabled integrated data processing and telecommunication functions to a centralised location. This function explains how information system can mobilise organisation support operations to a centralised strategic functions spreading power away from local administrative support functions to the centre of strategic integrated operation.

Information technology is increasingly becoming important strategic resource resulting to intense competition in the markets forcing companies to become more efficient and effective. (McFarlan 1984, p.98) Globalisation of business operations have also come to effect since the adoption of IS applications.

Sheth (1994) argues that IT has facilitated the post-industrial age where companies acquire global operations and products immensely reducing time and space barriers in market operations. Dating back to its ability to influence organisational changes, Sheth (1994) argues that information technology has enabled flexibility allowing easy collaborations between companies leading to increased mergers and acquisitions evidenced today.

With regards to technological revolution, information technology has enabled availability of affordable and useful software applicable to organisation enabling them operate on reduced costs (Rouse and Howard 1993). Telephone companies are good examples of how office automation through computerised billing and operation services can be essential in enabling a company gain competitive advantage over others.

These companies also reported reduced operation costs that resulted to significant cost savings and easy account management with the application of information technology. Hotel and tourism industry on the other hand have also reported significant reduction in what Sheth (1994) states as “operation costs through computerised travel reservations, guest reservations, billing and physical facilities” (p.5).

Information technology provides systematic monitoring and evaluation of product and service ensuring less error per unit of activity is achieved. This strategy is evident in the scanner technology and The Universal Product Code (UPC) barcode with chart labels used throughout the US in supermarkets to identify products being purchased. This system has also been used in to speed up checkout processes in airline baggage applications and inventory control in merchandise management in retail stores (Sheth 1994, p.5).

Telecom companies and Fedex Express are increasing relying on value-added services to customise needs of users by creating immediate value and differentiation. Both of these companies have extensively integrated information technologies into their system as a way of enhancing their reliability and ensuring timely deliveries are made -which serves a competitive advantage.

When used correctly, information technology faced with information can serve as a competitive intelligence in business operations. For example the Sabre system as applied by American airlines ensures constant updates of airline schedules and fares are adjusted serving it a competitive advantage over other companies.

Technology-enabled business solutions have facilitated globalisation of business operations through retail and wholesale transactions such as global banking. Web-based electronic banking solutions have eliminates time and distance barriers ensuring suppliers and customers are provided with adequate and efficient services.

As a control and coordinative function, IT has facilitated financial and human resources services increasing the global nature of interdependent to information system which in turn enhances business strategy. Sheth (1994) provides perfect example of such operations to include Investment banking and stock exchange companies as a global business operations specialising in borrowing and investing capital across global financial markets on web portals.

Sheth (1994) article also emphasises that without information system, the high degrees of stock market volatility and market crash experienced a decade ago would not have occurred. He further adds that computerisation of information technologies have enabled investors adequate information on daily trading cycles.

Airline industries on the other hand have been great beneficiaries of information system through the application of inventory control and order entry system since most of its retailing merchandise services such booking tickets are done on internet portals.

Finally, embracing information technology through mergers and acquisitions has enabled rationalisation of manufacturing capacity on international levels necessitating what Sheth (1994) states as “the development and deployment of global networks to coordinate all the activities of manufacturing, assembly and fabrication across global networks” (p.8).

Sheth (1994) concludes by adding that “areas of global business operations such as global procurement, marketing, resources and economy are creating a need for information technology to eliminate time and distance barriers” (p.8).

One more reason for increasing the importance of information technologies is the reorganisation of departments and corporations. It has been evidenced that office automation functions have realised reduced operational costs and facilitated efficiency through flattening an organisation and consolidating the support functions such as clerical and secretarial to enable faster data processing as evident in many telecommunication companies.

Also, the increased domestic mergers and acquisitions were facilitated by integration and consolidation of information systems which enabled companies realised their capital investment through reduced operation costs.

Realisation of corporate strategic resource requires re-organisation and rationalisation of respective information technologies. In crisis management for instance, Sheth (1994) urges the need to recognised adequate information technologies when he stated “ is it possible to prevent, abate, contain or at least quickly respond to corporate crises such as earthquakes, major fire, random shootings, or stealing proprietary information” (p.9).

Conclusively, as companies grow and competition intensifies, the need to align company’s strategic goals to become market driven is required. Sheth (1994) succinctly adds “when an organisation shifts from product divisions to market divisions, the value chain and flow of operations change significantly “(p.9).

This is to mean that if a manufacturing firm for example is driven by materials and customers demand, application of information system to bridge the gap and re-organise its functional activities and support systems to satisfy its customers is required.

Sheth (1994) concludes by adding that “many functions cannot be carried out efficiently without customer order entry systems, database management and, in general, on-line integrated information systems” (p.9). As mentioned earlier, understanding of current practice relating to the application of information system in areas such as crisis management, competition, mergers and acquisitions and consolidation are of paramount importance.

This article has realistically pointed out increased value in IS application by providing examples on its efficiencies in the mainframe computing. Facsimile machined have transformed to calculators and telephone terminals. Finally, fibre optics, personal computers and the advent of digital services are among just a few information system solutions mentioned by Sheth (1994).

Data Protection Legislation

Data Protection Legislation is a law designed to protect personal data against illegitimate processing or unauthorised deletion or loss. Personal information is subjected to a complex array of data protection laws limiting data use without the consent of the party being obtained from. Below is an overview of some of the UK laws that business need to consider to avoid what Wessing (2010) states as “issues of legal liability, restriction on the handling of data or damage of brand and reputation” (p.1). The Data Protect Act 1998 provides

Rules and practices that must be adhered to when processing information and grants rights to individuals whose information are being availed. This does not however prevent data processing but limits extend to which this information is being availed. This is done by creating independent supervisory body to ensure UK businesses are consistence with legislative requirements. Enforcing rules, rights and practices to ensure safe and healthy working environment aims at harmonising data protection legislation across UK.

Aimed at regulating processing of data as applied to computer-based records, UK Data Protection Act directive strives to harmonise legislative rules on data protection to ensure its citizens are well informed and protected.

Principles of data protection are applied particularly as stated by Wessing (2010) as “what personal data being processed, obtained and subsequently used, ‘fairly and lawfully’” (p.3). These are mentioned as;

1. Ensuring data processed meets pre-set conditions of legislative rules,
2. Requesting for permission from individual before collecting data from them.

This implies that information regarding the processing of personal data has to be consented and explained of its legitimate interests. In this regard, data subjects are required to be provided with extensive information explaining how data will be gathered and processed as well as full identity of data controller and purposes of data being collected. Data subjects on the other hand are required to be provided what Wessing (2010) states as “rights that include right to object to direct marketing and right to prevent processing likely to cause substantial distress to” (p.3).

The Privacy and Electronic Communication

The Privacy and Electronic Communication regulation applies to marketing communications activities via electronic media such as fax, email and telephone. This directive to privacy is aimed at governing data in the events of information exchange. This electronic communication regulation act requires the sender to provide his identification and notify the recipient whenever their information is being obtained.

Regulation of Investigatory Powers Act 2000 (RIPA)

This legislation is concerned with monitoring of communication on public and private networks. Lawful interception obtains communication network data for monitoring purposes and requires companies to inform users of the subsequent use of their information as provided by Lawful Business Practice Regulations 2000.

RIPA sets out what Wessing (2010) states as “requirements for monitoring or keeping records of communication in self regulatory practices and demonstration that standards by persons using the system and detect authorised use of employer information” (p.8).

Freedom of information Act 2000 (FOI)

Freedom of information Act 2000 (FOI) gives individual rights to access or deny the existence of the recorded information held by public authorities or competitors (Wessing 2010, p.8).

Incorporating key aspects of the data protection legislation

Apple Company started as a computer company in the 1970s and has continued to expand its products over the decades to more specialised products. It admits to using cookies on its website as a strategy of keeping statistics on what parts of the websites that are most hit and how much time clients spend on the website for purposes of product improvement- mentioned as number one online advertisement strategy (Apple 2010).

Some data may also require special kind of service level features such as Voip or video conferencing. In this regard, lawful interception of information networked data for monitoring purposes will require Apple to adequately inform its users of its subsequent use.

Information System Planning Framework

While multihoming is generally used to eliminate network failures, Apple Company applies it to save data transfer costs as the site can use several Internet Service Providers (ISP) and route data traffic to a certain ISP (Hinden 2010).

On the contrary though, Information system managers in Apple Company when attempting to connect employees in various department fails to implement data protection rules when spying on employees who engage in leisure browsing activities while at work. These problems have always been attributed to adequate education on employee privacy due to lack of resources, insufficient planning process and output related problems.

Failure to hire technical expertise commitment to carrying out the final plan increases fault intolerance and redundancy because when a lot of office hours are spend on leisure browsing resulting to low outputs. In this regard, resources are required to carry out strategic information system planning, finding team leader with adequate knowledge in computer support and offering education on data protection legislation.

In this regard, top management executives should ensure company objectives are not detailed, lengthy and complex, otherwise information system application may be of no value. Where the objective of an organisation aligns with IS strategy, Barlow (1990) argues that “the large number of methodologies that have been developed can often add confusion rather than clarify to the (IS) planning process (p.6).

Conclusion

SIS plans to integrate into the corporate system should be specific and simple to allow understanding of its procedural order of development. The need for continuous updating and improving of information system application to align with firm’s strategic objectives against its capabilities is required.

Since information technology provides systematic monitoring and evaluation of products and services, companies that apply IS should be able to record increased turn over ratios due to reduced error per unit levels. It is indeed true that SIS is a prerequisite of management functions and its application is critical to company’s future success.

In this regard, all corporate functions should align their company strategic direction with information system applications as a strategy to increase the importance of information technologies. In cases of data protection legislation, subjects are required to be provided with extensive information explaining how data will be gathered and processed as well as full identity of data controller and purposes of data being collected.

List of References

Apple. 2011. Apple Customer Privacy Policy. Available at; https://www.apple.com/legal/privacy/

Barlow, J.F., 1990. Putting Information Systems Planning Methodologies Into perspective. Journal of Systems Management, 1, pp. 6-9.

Battaglia, G., 1991. Strategic Information Planning: A Corporate Necessity. Journal of Systems Management, 1, pp. 23-26.

Beath, C.M., and Orlikowski, W.,1994. The Contradictory Structure of Systems

Development Methodologies: Deconstructing the IS-User Relationship in Information Engineering. Information Systems Research, 5, pp.350-377

Hinden, R., 2010. RFC 3513: Internet Protocol Version 6 (IPv6) Addressing Architecture. Available at: https://www.ietf.org/

Hsu, C., & Rattner, L.,1993. Information Modeling. Journal of Productions and Operations Management. 1(3), pp.1

Keen, P., 1993. Information Technology and the Measurement Difference: A Fusion Map. IBM Systems Journal, 32, pp. 1

King, R., 1995. Creating A Strategic Capabilities Architecture. Information Systems Management, 12, p. 67-9.

Lederer, L., 1992. Strategic Information Systems Planning – The Method/1 approach. Information Systems Management, 1, pp.1

McFarlan, F., 1984. Information Technology Changes the Way You Compete. Harvard Business Review, 1, pp. 98-105

Parvi, F., and Ang, J., 1995. A Study of the Strategic Planning Practices in Singapore. Information & Management, 28, pp 33-47

Pant, S., & Hsu, C., 1995. Strategic Information System Planning: A Review. Information Resources Management Association International Conference. 1, 1-23

Pant, S., Rattner, L., & Hsu, C., 1994. Manufacturing Information Integration Using a Reference Model. International Journal of Operations and Production Management, 14, pp.11

Porter, M., & Millar, V., 1985. How Information Gives You Competitive Advantage. Harvard Business Review, 1, pp.1

Rockart, J.F., 1979. Chief Executives Define Their Own Information Needs. Harvard Business Review, March, pp.1

Rouse, W., & Howard, C., 1993. Software tools for supporting planning. Industrial Engineering, 1, pp. 51-53.

Sheth, J., 1994. Strategic Importance of Information Technology. Advance in Telecommunications Management, 4, pp.1-14

The Technology Payoff., 1993. Feature Article. Business Week, 1, pp. 57-68.

Wessing, T., 2010. An overview of UK data protection law.