Technology Upgrade: The “A” Energy Company Case Study

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Introduction

The following is an examination of the “A” Energy Company and delves into a SWOT assessment of the current system and the potential alternatives that can be implemented to replace it. It is within this context that when analyzing the present day system utilized by the company when it comes to its networking needs, the structure and means by which it is accomplished should be evaluated based on the process of eliminating the “human element” whenever possible so as to maximize efficiency and minimize costs. Through such a method of evaluation, it is expected that a better and far more effective system can be developed for the company to address its various needs.

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SWOT Analysis for Technology Upgrade Proposal

Strengths
  • Technology has a high amount of redundancy which prevents total network failure
  • Easily upgradable infrastructure
  • High levels of security
Weakness
  • Energy costs of IT infrastructure are not aligned with company goals
  • Capital intensive infrastructure
Opportunities
  • Utilization of scalable IT infrastructure without high capital cost in the form of cloud based services
  • Introduction of new product tracking techniques to increase efficiency
Threats
  • Equipment obsolescence
  • Current infrastructure may not suit long term energy saving goals of the company

Strengths

The current IT system utilized by the company has several strengths which make it a viable platform to continue using. The first strength of the company is the various access servers, administrative servers, routers and other additional pieces of hardware utilized to maintain the system. As evidenced by the report, the “A” Energy Company utilizes a staggering amount of internal systems, redundancy backups (ex: the UPS, diesel generator, etc.) and other peripheral pieces of hardware.

Since individual operations of the company are divided into different access servers, this means that even if one server should go down, the rest can continue operating as normal. This ensures that even if “A” Energy Company’s document access server or email server were to go down, its production server and application servers would still remain in operation, thus allowing a rudimentary continuance of work until the problem can be fixed.

It should also be noted that aside from separating the workload across multiple servers, the company has various backup systems in place to prevent loss of operations. The first is its backup storage system which stores various files, emails and important company information in an off site server. Through such a system, even if various servers have been compromised via a virus or destroyed through some form of natural disaster, this still allows the company access to its valuable files and data.

Additionally, in the event of a blackout, the company has several UPS systems as well as a backup generator so that the servers can continue running until power can be restored.

Aside from this, the system utilizes a core network that enables an efficient means of in-house collaboration and cooperation as well as allows employees to work from home if they choose. It should also be noted that the current system is configured in such a way that additional servers and server capacity can be easily added to deal with the plans of the company to expand into new locations. From an operational management standpoint, the current system is robust and more than adequate enough in terms of its capabilities to handle the additional workload and capacity needed for additional manufacturing locations.

Weaknesses

While the previous section has showcased the robustness of the network and its various capabilities in light of the needs of the company, it is also important to take into consideration where the system can be considered “lacking”. The first issue associated with the system is the sheer level of electricity that is consumed by the systems on an annual basis. These systems consume vast amounts of power and add a large yearly expense to the company’s operations.

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When taking into consideration the fact that the company is supposed to specialize in energy conservation, it reflects badly on its operations when it consumes a considerable amount of electricity on its network infrastructure alone.

Another weakness that should be taken into consideration is the amount of capital invested into the hardware that is being utilized. After examining, the constantly evolving nature of present day computer systems wherein newer and better hardware and software is released almost on a yearly basis, any hardware bought and utilized now will become obsolete in the near future. It should also be noted that most computer hardware tends to break down eventually after a certain level of use with servers being the most vulnerable due to the workloads that they are expected to handle on a daily basis.

From this perspective, it can be seen that the current IT system that is being utilized by the company is very capital intensive and, as such, can be considered as a literal drain on resources that would be far more effective if invested into other ventures. Also, as the company continues to grow, the capital for investing into additional IT hardware will grow as well resulting in an exponential increase in IT infrastructure spending which would reduce the company’s yearly profits.

Opportunities

Based on an evaluation of the current IT infrastructure of the “A” Energy Company, some potential improvements that could be implemented in light of the future expansion of the company would come in the form of updating the current method of product tracking utilizing an RFID tag system. RFID tags are basically radio frequency transmitters that are as big as a grain of rice that can be utilized in the company’s operations to keep track of all products that are being made in all stages of production.

What this results in is a far more efficient method of inventory control that helps to reduce the “human element” when it comes to tracking and maintaining the company’s inventory. Such a system can be easily integrated into the present day IT infrastructure of the company with little in the way of significant issues.

Other potential opportunities that should be taken into consideration is the potential to transfer several non-essential systems towards cloud based methods of operations. Cloud operations basically consist of leasing server space from a variety of online vendors such as Amazon.com or Google. These services in effect allow companies to lessen the costs associated with purchasing and maintaining hardware by simply having an outside system handle a particular aspect of the company’s operations.

Some systems that could be potentially shifted to cloud based resources come in the form of the company’s current email and backup systems. The Cloud server infrastructure would be an ideal location for transferring these systems since this helps to remove the possibility of local problems (i.e. natural disasters) impacting the locations where the company has its email and backup servers.

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Do note that while the security of the information stored in third party vendor systems can be problematic, the company can take steps in the form of utilizing various types of cryptographic software to ensure that the date remains secure.

The last opportunity that the company could implement would be to create a free online application that consumers could utilize in order to measure their energy usage. While the development costs would be substantial, the fact remains that this would help to generate greater awareness surrounding the company and could potentially increase the number of subscribers for the company’s services.

Threats

The primary threat that could result in a problem for the company would be if a virus, Trojan horse program or other types of malware got into the company’s server infrastructure. These factors could pose a threat since they compromise the integrity of the company’s security protocols and could result in proprietary information being leaked or significant damage being dealt to the files and systems of the company.

The inherent problem with interconnected network architecture is that this allows a virus to spread from one system to another in an expedient fashion. One of the most common methods in which this could occur would be if an infected storage device (ex: a USB Thumb Drive) were inserted into a computer terminal by an unwary employee.

The infected files from the thumb drive could pass into the computer and from there infect the rest of the company’s systems. Other instances in which this could occur take the form of an employee accessing a restricted website which could result in various types of malware being downloaded.

While private grids that have no internet access whatsoever and have restricted means of data access are considered some of the safest systems in the world due to the limitations placed on the way in which they operate, the fact remains that the company cannot operate in such a capacity resulting in malware being a real threat to the company’s data integrity.

When examining the needs of the company when it comes to its network infrastructure, was seen is that it is at risk of constant system attacks given the level of internet access and operations that its employees need in order to do their jobs correctly. It should be noted though that new systems along with their respective software systems are often more secure as compared to their more obsolete counterparts, however, upgrading the company’s hardware and software infrastructure to prevent possible malware attacks would involve a considerable amount of capital to pull off correctly.

Despite the fact that the company employs a variety of firewalls to safeguard its data, examples of data penetration in otherwise secure systems as seen in the case of Target and Sony last year shows that any system that is connected to the internet is vulnerable, this is especially true when it comes to networked system infrastructures where one system leads to another which creates the potential for a virus to infect multiple aspects of the network after gaining access from one node. It is due to this that viruses are a definite threat to the security of the network.

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Leveraging the Current Strength of the IT Infrastructure

One way in which to leverage the IT infrastructure of the company would be to utilize its current server infrastructure in order to create more work from home opportunities for its employees via the creation of in-house systems geared to sync with laptops provided by the company. The company’s current IT infrastructure can definitely support the addition of a new system to support telecommuting for some members of its worker population.

The reason why the company would implement such a service in the first place is connected to the growing desire of employees to have a “work-life” balance as well as the fact that telecommuting actually saves the company money in the long run since it reduces the utility expenses associated with having workers within a building. Independent services for video conferencing such as Skype can be used as an effective and cheap means of communication if different employees need to speak to one another or with their manager. Above all, Skype can be maintained at a lower cost as compared to utilizing its own IT infrastructure to make voice calls.

Also, do note that due to the presence of cheaper alternatives in the form of Skype, it does not make sense to allocate the resources for a dedicated in-house service when a virtually free service can be utilized instead. It is based on this that through the use of its own IT infrastructure to create “work from home” related services while utilizing Skype for cheap video conferencing, it can be expected that the company would save money on utilities while at the same time create a happy workforce that has a good “work-life” balance.

Discuss the Weaknesses

When analyzing the various weaknesses associated with the company, the problem of equipment obsolescence, capital intensiveness and power requirements show the inherent problems with the company’s current system.

Equipment Obsolescence

The problem with equipment obsolescence, within the context of the operational performance of the company, is related to the inherently competitive nature within many IT dependent companies at the present. With the constant pace of technological improvement, equipment that was bought 2 to 3 years ago can be considered obsolete by today’s standards. This situation differs greatly from non-IT dependent companies wherein the rate of obsolescence is far longer.

One example in which this can be seen is in the construction industry wherein construction companies utilize bulldozers, heavy loaders and jack hammers in order to carry out various types of construction. Within the past decade, only minor changes have been implemented to the equipment utilized which enables construction companies to continue to remain competitive within their respective markets despite having equipment that could have been in use for five years or even longer.

It is from this perspective that when observing the operations of the energy company that is under examination, it is immediately obvious that its current industry demands up-to-date server infrastructure in order to remain competitive and, as such, this creates a considerable strain on its monetary resources which will be discussed in the next section.

Capital intensiveness

In direct relation to the issue of equipment obsolescence is the needed capital in order to replace them. IT equipment is not cheap and, as such, requires a considerable level of capital investment for updated equipment to be bought. Considering the fact that the rate of equipment obsolescence in IT dependent companies is faster as compared to other industries, the end result is successive infusions of capital in order to purchase new systems.

Over time, the sheer amount of money invested into new systems would become considerable which, when taking into consideration a “cost versus output perspective” seems to be a wasteful endeavor. As such, an alternative method needs to be implemented that resolves the capital intensive nature of present day operations.

Power Requirements

The last deficiency associated with the company is the sheer amount of power that its in-house servers consume. Given the amount of servers the company utilizes, the utility expense of the company would be considerable. This situation is further exacerbated by the desire of the company to expand its operations which would of course result in even higher utilities expenses in the long term.

Bringing New Products and Services

The first potential product that the company could bring to the marketplace using its IT infrastructure would be a website that measures the current electricity usage of a family based on the type of devices they have at home. Such a system would definitely benefit various families that are seeking to reduce the cost of electricity in their respective homes. As such, this type of service can be considered as a form of corporate social responsibility that benefits the general public in a direct way. The second product would be an advisory site informing people of practices that help them to conserve electricity.

Deficiency with Greatest Impact

Based on a thorough analysis of the company’s current infrastructure, it becomes immediately apparent that an attack by a virus or a similar type of malware infection would be the greatest potential threat to the company. The reason behind this is quite simple; if a virus were to compromise the IT infrastructure of the company it could potentially disable key operational systems which would prevent normal operations.

This could either lock workers out of their terminal, delete programs, cause overheating of the equipment or in a worst case scenario disable the electrical grids that the company is responsible for which would in turn adversely impact its customers. Not only that, some viruses and other forms of malware are not as easily removed through the use of an anti-virus program and may even require a full system purge and reformatting in order to completely get rid of the virus.

This would disrupt company operations to such an extent that the company could lose millions of dollars per week due to non-performance. Taking these factors into consideration, viruses and other forms of malware would definitely cause serious repercussions for the company and need to be taken into consideration.

Research

The research strategy that was utilized in order to evaluating current technologies centered on my use of grounded theory as the primary method of examination. The following questions are utilized as guidelines in order to examine the problem and determine what response would be the most appropriate. These questions consist of:

  • What is going on?
  • What is the main problem within the company for those involved?
  • What is currently being done to resolve this issue?
  • Are there possible alternatives to the current solution?

It is through this approach that the evaluation created in the next section was devised in order to address the identified issues in relation to the company’s current IT infrastructure. When it comes to my own personal research strategy, I would first utilize the internet in order to investigate current developments in technology. It is after this that I would analyze various cases studies involving the technology to determine their overall effectiveness.

Potential Solutions

One of the potential ways to address the current weaknesses that were identified earlier is to implement the use of virtualization in the company’s current server infrastructure. This would help to address the issue of network obsolescence by having another company handle the hardware aspect of the company’s operations.

Basically, under this particular system, virtualization software would allow the company to run several operating systems and various different applications on the same intranet server of the company at the same time. What this does is help to reduce the associated costs with the multiple server infrastructure currently being utilized by the company by reducing the amount to 3 to 4 servers as compared to the multitude that are currently being utilized to run an assortment of applications (Li, Yen, Hu, Lu & Chiu, 2012).

What must be understood is that the use of virtualization is an effective means of increasing the efficiency as well as the flexibility of a company’s IT infrastructure while at the same time limits the costs inherent when it comes to most server systems. As mentioned earlier, one of the problems with the current system is that it is far too capital intensive when it comes to the necessary hardware and software upgrades as well as the sheer amount of power necessary to run it (Li et al., 2012).

Through the use of virtualization software, many of the aforementioned issues can be resolved, for instance the capital intensive nature of the system upgrades as well as having to replace parts when they break down can be lessened considerably if there are only a few servers working at the same time. Not only that, with fewer servers in place, this helps to reduce the associated utilities cost that is common with maintaining a system of that size. Expanding the system to accommodate new facilities would not be an issue either since a partition of the servers can be allocated for the new support systems necessary for the facilities (Preimesberger, 2014).

This process also helps to address threats related to viruses and malware through the use of virtualization to create another “screen of protection” so to speak between the company’s files and systems and the terminals utilized by workers. This due to the fact that a virtual “screen” can be utilized to remotely access the cloud based files that is not directly connected to terminal utilized by the employee. As such, this should help to reduce viruses or other types of malware from entering into the cloud based system.

Lastly, costs associated with the UPS and other backup power supplies can be diverted towards other projects since fewer servers would enable the company to utilize far less active backups. Do note though that this particular system does have a few drawbacks in the form of increasing the risk of potential server failure since various systems that are needed to keep the company running are in effect isolated to single instead of multiple servers. However, despite the potential risks, such a system would definitely be a viable method of reducing operational costs.

Aside from the use of in-house virtualization technology, another potential alternative would be the use of external virtualization via cloud networks. Cloud networks can be considered as a manifestation of virtualization software via the internet wherein companies could in effect “rent” server space online to handle a variety of applications and processes (Boland, 2013).

When it comes to the current operations of the company, nonessential systems such as document processing and email services could be shifted towards external cloud networks which would enable the company to save money on server costs (Capossela, 2011).

Staying informed about current technologies

In order to stay informed about current technologies, the researcher will attempt to gain subscriptions to various technology related magazines and read various technology related websites that usually have a plethora of content that deal with emerging technologies. It should also be noted that various online magazines send email alerts to their subscribers regarding interesting developments that often occur. These “alert systems” would be effective in immediately informing me about new technologies that have come about that would be of use.

Through such practices, it would enable me to learn about new developments and how they could potentially be applied to improving a company’s IT infrastructure. As for emerging technologies that could potentially help the company in the future, one technology that shows great promise has been research into developing 3D methods of memory storage utilizing crystal based storage devices.

While the technology is still in its infancy and has yet to come out with even an operating prototype, enough research has been completed that shows the feasibility of such an approach. The potential application of this technology is in the creation of better and cheaper cloud services which can help companies cut down on their costs.

Another potential technology that should also be taken into consideration is the current focus on developing artificial diamond based processors. The supposed advantage of this potential new technology is the creation of processors that are far more efficient and do not heat up quickly. When it comes to 3D storage technologies, they in effect allow a layered method of memory storage onto a disk or crystal based storage platform.

This can exponentially increase the amount of memory stored beyond the current capacities of present day storage devices. For instance, while the largest commercially available hard drives for businesses can reach up to 3 terabytes in capacity, 3D storage technology would enable manufacturers to develop hard drives with up to 100 times the current maximum storage capacity yet at a far lower cost. From a competitive advantage perspective, this would allow the “A” Energy Company to store any manner of program or file without having to worry about increasing the current capacity of its hardware.

From a competitive advantage perspective, this technology would allow the company to operate through the use of fewer hard drives as compared to the dozens or even hundreds of hard drives other companies utilize on a daily basis. For example, if the company were to shift towards virtualization via cloud computing, 3D storage technology would enable it to simply partition the needed hard drive into hundreds of different sections with each partition being devoted to a particular function.

This is where artificial diamond based processors enter into the picture wherein through their greater processing capacity, this would enable the company to effectively utilize the hundreds of different partitions at the same time thereby allowing the different systems to run seamlessly without having to add in additional hardware.

These systems could be utilized by cloud service providers like Google or Amazon in order to create effective cloud based systems that are far more efficient for their clients. From a competitive advantage perspective, this increase in processing power would enable the “A” Energy Company to run more support systems for consumers which should help in increasing product patronage.

Based on the capacity of the aforementioned technologies, they could potentially help the company when it comes to storing its backup information in a more affordable way as compared to utilizing present day hard drives.

Recommended IT Solution to address the identified weaknesses

It is the recommendation of this report that a shift towards cloud based services should be implemented for non-essential systems. This shift addresses the indicated deficiency and the company’s needs by acting as a means by which it could get around the issue of equipment obsolescence, power generation costs as well as the capital intensive nature of present day operations.

Through the use of cloud based services, it would be the service provider that is running the cloud service that would be required to upgrade their equipment and pay for utilities, while the “A” Energy Company would merely be renting the necessary storage and processing space it needs for its operations. This addresses the high utilities cost as well as the associated costs related to equipment obsolescence. Furthermore, since access to the company’s records would be done through a virtual screen and not through a direct link to the company’s main server, this would help to reduce the potential for viral attacks to hamper the company’s operations.

Reference List

Boland, R. (2013). Corps Blazes Ahead With Cloud Computing. Signal, 67(8), 22-25.

Capossela, C. (2011). Cloud Computing Means Flexibility. Forbes, 187(9), 37.

Li, S., Yen, D. C., Hu, C., Lu, W., & Chiu, Y. (2012). Identifying critical factors for corporate implementing virtualization technology. Computers In Human Behavior, 28(6), 2244-2257.

Preimesberger, C. (2014). Storage Industry May Have Reached a Notable Tipping Point. Eweek, 1.

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IvyPanda. 2022. "Technology Upgrade: The “A” Energy Company." April 13, 2022. https://ivypanda.com/essays/technology-upgrade-the-a-energy-company/.

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