Introduction
Information and Communication Technologies (ICT) includes all the technologies such computers, which include desktop and laptop, software and internet connections that are mainly intended for the purpose of processing of the information and communication purpose. (Information and Communications Technologies).
In the earlier years, telecom and telegraph services were considered as examples of unification technology but the world has advanced a lot in every field, especially in the communication technology field. Now the network systems such as local area networks and wide area networks have given a new face to the communication technology field. Business organizations are continuously changing according to the changes in the economy. To increase their performance, they are adopting new and innovative technologies and also shifted their focus from the organizational level to the inter-organizational level. This paper will study the incorporation of communication technology in four organizations in the UK. They are Tesco, Walmart, British Petroleum, and the Royal Bank of Scotland. The paper will also survey this through a questionnaire.
Communications Technology
One of the main trends followed by the business organization is the use of Information and Communication Technology (ICT), which will help the organizations to reduce the cost and also to increase their capabilities. There are many developments in the field of ICT like the development of the World Wide Web, Electronic data interchange, and electronic mail. These enable the organization to overcome the cross-organizational boundaries particularly concerning the information demanding processes. Many new ways have been adopted by the organization for the smooth conduct of the business such as the introduction of electronic trading markets, electronic auctions, and electronic book stores. Electronic trading and electronic auction use information technology along with communication technology like the internet to bring the buyers and the sellers together and also to save cost and time in the business processes. This will in turn improve the efficiency of the business. All the business orders are processed automatically and the risks associated with the business are reduced considerably.
ICT plays an important role in maintaining the inter-organizational process and also to shape these processes. The advent of the ICT In business firms has geographically expanded the relationship between the organizations and has got a positive impact on the coordination between the organizations. The use of ICT reduces the coordination costs between the organizations to a considerable extent and also increases the outsourcing of the firms and in turn, increases the number of organizations involved in the structure. (Hengst and Sol).
ICT plays an important role and also gives considerable support to the productivity of large business firms. E-commerce is the latest word in communication technology in the business of the UK. The better use of communication technology in the business will provide significant benefits to the business in terms of increased profitability, innovation, growth, and quality of the business since the communication technology provides significant competitive advantages over the competitive firms. (ICT Helps to Boost Business Says New Research. Public Technology).
There are numerous technological innovations taking place in the ICT and are continuing at a rapid pace. It helps to reduce the prices of goods and services and also leads to a wide range of new and improved applications like business-to-business e-commerce and business-to-consumer e-commerce etc. The broadband facility has contributed rapidly to the growth of the telecommunication sector. It is the business sector that can exploit the benefits of ICT by its effective use. More investment in communication technology will increase the technology available to the workers and will in turn increase labor productivity. It also further increases the overall efficiency of the business by combining the labor and capital by reducing the operational costs and through rapid modernization. The business firms which are successfully implementing the communication technologies in their organization combine it with new strategies, new business processes, and new organizational structures. The business firms which are sticking to such a strategy are likely to have more market share and higher productivity than other firms. More savings in ICT will also help the firms to progress and to re-invent the business development and also to widen new applications and also to enable valuable innovations in the business. It helps the firms to face the competition and stay ahead of all the competitors. Many of the larger business firms are adopting ICT mainly to redesign the information and the communication flows within the firm and also to combine these flows right through the value chain. Through this, they can reach the international market and can successfully face competition from them. (Meeting of the OECD Council at Ministerial Level).
Every successful business firms have to adopt the best communication technologies available in the market. It enables the firms to properly communicate among their different branches. One of the latest advents in communication technology is telecommuting, which has got many benefits since all the remote branches of the large business firm are connected through this method. All of the workers can log into the conference through their home phones. All the workers can be included in the conference without meeting their travel expenses and other costs.
British Petroleum
British Petroleum is the world’s largest energy company situated in the UK and is engaged in providing its customers fuel for transportation purposes, energy for heat and light and retail services, and petrochemical products for everyday use. It is the leading integrated oil company in the world with an estimated global share of around 3% of oil and gas production and 4% of refining capacity among the key global brands in which they operate. The total turnover of BP is $284 billion for the year 2007 with more than 98000 employees working and has about 24100 service stations around the world. The main business of BP includes oil and natural gas exploration using the most modern and sophisticated technologies. Over the past 150 years, they have drilled more than 2 million wells for oil. They also build large and durable production platforms to use the new expertise to extract as much oil and natural gas as possible. They maintain huge pipelines and also operate large tankers and ships to transport oil and gas worldwide. They transform crude oil into usable products like gasoline and other chemicals that can be used as everyday items. They also generate alternative sources of energy from new solar and wind businesses, to capture and store carbon dioxide. The economic and technological explosion during the late nineties has increased the market value of the companies. The new economy bought many changes and forced to adopt so many changes in the internet and other services. To overcome the tough business climate in the organization, the management of the company planned to adopt new technology and also brought changes in communication technology. These brought changes in the way the organization interacts with its employees, customers, and also with their suppliers. Internet use has proved to provide an increasing advantage and has influenced routine work. They have also innovated digital technologies which connect physical objects with the digital world. The digital technology adoption model consists of an internal core team that is broadly connected to and is constantly interacting with the vast network of outside resources. Using a technique called deal flow allows filtering the noise quickly and also focuses on those technologies which have got the direct business effect. Many new advances like immersive visualization have promoted advanced data analysis processes. Location intelligence is another technology adapted by BP to widening its range of business applications. Location intelligence consolidates information from many contrasting lists and inserts it in the new management system and gives information to the crisis management team for an accurate report. This technology is very relevant in BP since their businesses are universal and material. It uses a collection of software technologies and applications which are experts in dealing with location data. It complements the information’s geographical location and displays all the information in easy-to-understand screen visualization. The advantages of location intelligence include entry into the high-powered consumer market with zero-cost tools like Google Earth and other virtual earth tools. There is also rapid growth in the sources of location data due to location intelligence. It also promotes real-time data availability with wireless cellular and other forms of communication including satellites. Using this data can be transferred to any part of the world instantly. The wireless technology adopted by the BP also the risks associated with the paper works and also manages the work in real-time. (Global Insights).
Tesco
Tesco Ltd. adopts an internet-based retail sales strategy. It improves their customer base. Online customers of Tesco are increasing on a high scale. “Tesco internet sales rose by 31 percent in 2007 to £1.6bn, with profit up more than 40 percent on the year before to £124m, boosted by improved order picking.” (Mari).
Tesco supermarkets now occupy more than one million active online customers which improve the business at the rate of 20% than the previous year. Improved facilities through online ordering and delivery are the factors that lead to the increase in sales. With online ordering and servicing, customers can easily communicate with the retail stores and thus availability of a specific product can be ensured. It supports faster and easier communication between customers and retailers. Tesco also arranged a dot com store in Croydon for delivering products in the local area. It is highly effective and profitable with the handling of orders of more than $ I million per week. The localized distribution strategy of Tesco is highly facilitated with the dot com stores. (Mari).
A cable and wireless system facilitate the establishment of a voice-over-internet protocol platform for the communication network. Thus the cost of voice and data call costs in the enterprise is highly reduced. Through the advanced FMC (Fixed-mobile convergence) system, call and equipment systems implemented for employees are also reduced.
Customers get self-service information from the in-store information system of Tesco. Video referencing telepresence technology by Cisco is also purchased by Tesco for facilitating the transmission of managerial information to inform their distribution and marketing personnel internationally. (Clarke).
Mobile VoIP service launched by Tesco is an innovative technology in communication. The telecommunication system makes the international operations of the business more cost-effective with improved efficiency.
Wal-Mart
Wal-Mart has adopted a Satellite communication system and it supports economical communication between the headquarters and distribution centers and department stores, in a fast and flexible manner. The advanced satellite communication system provides a facility for transmitting voice data, computer data as well as video files. Wal-Mart is one of the first retailers to use the satellite communication system. For the introduction of the advanced technology, Wal-Mart enters in to contract with M/A-Com for an amount of $ 16 million which is a prominent firm in high-tech communication systems and pieces of equipment. Through this system, Wal-Mart establishes a close link between the headquarters and distribution centers, as well as discount stores and Wholesale club units. Thus its 2 distribution centers and 750 discount stores are coming to closure with the newly adopted communication network.
M/A Com’s ISBN (Integrated Satellite Business Network) communication system provides a facility for a large amount of data transmission at a relatively low cost. The new system brings an additional cost of $ 50000 per month. It is expecting that the cost return on the new technology will take 4 to 5 months through cutting down the annual phone bill of discounters for an amount of $ 10 million through the faster transmission of computer data, the new facility supports faster delivery of data and information. Massive transmission of data becomes possible through this system. “The voice and computer transmission on the system will be digital data that can be sent at 56 kilobits per second, (kbps) compared to the 12 or 24 kbps transmission over telephone lines.” (Wal Mart to Kick Off Satellite Communication system: Still Development, p.1).
Through transmitting video signals of training films, delivery of training information to a different department of Walmart becomes easier and less costly. A satellite communication system was adopted by the company to cut down the telephone-based data transmission costs with improved facilities. Communication costs are highly reduced through the new system. To establish communication between departments situated in different states, telephone networks require a contract with more than 300 telephone companies operating in different states, while at the same time the new system involves a contract with the M/A –Com only. It brings quality in services provided by the M/A-Com. through better system maintenance. Through the satellite communication system, real-time communication becomes possible. It supports the transfer of sales and production information from production and departmental stores to the headquarters regularly. The satellite system of communication is used in any part of the world; relocation of business units does not need changes in the communication system. (Wal Mart to Kick Off Satellite Communication system: Still Development, p.1).
Royal Bank of Scotland
The Royal Bank of Scotland is one of the country’s oldest corporations that still operate successfully in the UK and well fifty other countries in the World. It would be interesting to note how well the bank started much before the IT revolution has been able to manage the incorporation of IT into its operations. The bank was started in 1727 and has a presence in Europe, the Americas, and Asia.
The bank has provided online banking facilities whereby customers can communicate and also conduct financial transactions through the internet. Security is an important concern, especially for financial institutions. This is because of instances of online fraud. The bank has installed a system whereby organizations that deal with it are issued a digital certificate which will be verified when any of the authorized officials try to make an online transaction. They are also provided with a smart card and a pin. When the customer inserts the card and enters the pin, the digital certificate of the card is verified and the transaction authorized. (The Options in Our Trust Assured Managed Identity Service). The bank also can provide secure messaging services. On application, an email account (specially created by the bank) will be provided. The password will only be communicated directly to the customer. When logging in for the first time, customers need to change the password. When a new message has come from the bank, a notification will be sent to the customer’s regular mail account. Sending messages to the bank works like the compose option seen in standard email systems.
The bank started incorporating communication technology vigorously in the early 1990s. The company had a lot of technical difficulties during the implementation of what was then called the Columbus Project. The bank also faced resistance from employees at that time. “We found more evidence of emergent protectionist strategies amongst the workforce in the Royal Bank of Scotland.” (Andriessen and Koopman, p.346).
Another area that the Royal Bank of Scotland has successfully incorporated communications technology is by extending banking solutions through phonese phone. People are on the move a lot these days and they may not have access to a bank or even its web portal. Mobile banking is one way to beat this problem and the Royal Bank of Scotland has successfully incorporated this technology into their system. This technology has been provided in the US by a company called Monetise Americas and in the UK by its sister concern called Mobilink. (Financial Institutions Choose Monetise Americas Mobile Financial Services Offered by Nyce Payment Services). The Royal Bank of Scotland has successfully incorporated communications technology into its operations. The management has the vision and this could be why the bank is still strong after 200 years of existence.
Primary data collection – Response to the questionnaire
A simple survey was done regarding gathering primary data. Ten questions with closed questions were prepared. It was sent to 100 chief executive officers (or equivalent) in the country by post. Fifty-two of them were kind enough to reply. The questions are pretty straightforward and self-explanatory except for question no 5. Many organizations invest in communications technology to help current levels of operations, strategies, and goals. But in effect, investment can help an organization to change its strategy and also to extend its goals and targets because of the additional facilities offered by the technology. The question is to find out how many organizations have realized this aspect.
Q.1. Does your organization have communication technology incorporated into operations? (This does not include telephone systems or fax machines). (Yes or No)
Discussion: As expected, nearly all the respondents use some form of communication technology. The negative response was from two businessmen who were traditional jewelers who take only private orders. They do have telephone and fax machines.
Q.2. Would you consider it as:
a) basic (like email facility),
b) medium (some business can be done)
c) high (almost all of the company’s operations can be done with technology).
Discussion: Most of the respondents have medium levels of communication technology. Most of them have online sales facilities as technology. Those who answered basic had only email communication facilities and a website in some cases. The nine who responded high had mobile business facilities and high levels of communication integration within the organization, with suppliers and customers.
Q.3. Has the investment in the technology been justified in terms of additional revenue for the organization? (Yes or No)
Those who responded in the negative felt that they had invested too much or had chosen the wrong technology.
Q.4. How well has it been accepted by the employees of your organization?
a) Well accepted
b) Moderately accepted
c) Accepted with hostility
In most organizations, employed accepted the technology as being helpful to their work. The other two responses were mainly because of fear of losing their jobs due to the adoption of technology.
Q.5. Do you find any perceptible difference in the operations after the incorporation of the technology? (Yes or No)
The five who responded negatively were among those who responded likewise for question no 3 also (about investment not being justified in terms of revenue increase).
Q.6. Have you increased the company’s goals/targets after the incorporation of the technology? (Many organizations incorporate technology just to make investments to help current levels of operations). (Yes or No)
This could indicate that only half of the organizations knew to understand the full impact that a well-planned communication technology infrastructure can have. The others just used it to make current operations more efficient. Strategy change may come later when they begin to realize the potential of the technology.
Q.7. Will your organization be committed to incorporating the latest technology in communications? (Yes or No)
As expected, no CEO will invest money unless they are sure of the returns. The reason for those six who responded positively was not understood.
Q.8. If no, please select one of the reasons from the list below.
a) Only if the technology is useful to us
b) Only after it has been found effective in the market
c) We already have the technology for the present needs
The first two responses seem practical answers to the question. The four who chose the last option were among those who felt they had over-invested at present.
Q.9. Have you increased your budget for communication technology in the recent past? (Yes or No)
Those who said no felt that their present budget is enough to cover technology integration costs.
Q.10. Would you recommend the technology that you adopted to other organizations? (Yes or No)
This question was just to know how well-perceived the CEOs were about their investment. The high number of positive responses shows that they had seen the investments as worthwhile.
Conclusion
It can be seen from the collection of primary data that most organizations have already understood the importance of incorporating communications technology into their operations. But only half seem to have understood the real potential that technology can provide to a business. The study of large corporations shows that they are fully aware of the potential of this communications technology. The Royal Bank of Scotland also had to face some resistance from its staff during the early days of implementation. It could also be that they have no other option, but to invest since they will not be able to the computer in this era of globalization and free trade. It can be concluded that the incorporation of practical communication technology is beneficial for any organization.
Questionnaire
Q.1. Does your organization have communication technology incorporated into operations? (This does not include telephone systems or fax machines). (Yes or No)
Q.2. Would you consider it as:
a) basic (like email facility),
b) medium (some business can be done)
c) high (almost all of the company’s operations can be done with technology).
Q.3. Has the investment in the technology been justified in terms of additional revenue for the organization? (Yes or No)
Q.4. How well has it been accepted by the employees of your organization?
a) Well accepted
b) Moderately accepted
c) Accepted with hostility
Q.5. Do you find any perceptible difference in the operations after the incorporation of the technology? (Yes or No)
Q.6. Have you increased the company’s goals/targets after the incorporation of the technology? (Many organizationsphones incorporate technology just to make investments to help current levels of operations). (Yes or No)
Q.7. Will your organization be committed to incorporating the latest technology in communications? (Yes or No)
Q.8. If no, please select one of the reasons from the list below.
a) Only if the technology is useful to us
b) Only after it has been found effective in the market
c) We already have the technology for the present needs
Q.9. Have you increased your budget for communication technology in the recent past? (Yes or No)
Q.10. Would you recommend the technology that you adopted to other organisations? (Yes or No)
Works Cited
- Andriessen, J H Eric., and Koopman, Paul L. Human Cultural and Political Issues. The Introduction of Information and Communication Technology (ICT) in Organisations. 1996. Web.
- Clarke, Phillip. Tesco. CIO. 2008. Web.
- Global Insights. Bp. 2008. Web.
- Hengst, Marielle Den., and Sol, Henk G. The Impact of Information and Communication Technology on Interorganisational Coordination: Guidelines from Theory. Informing Science. 2001. Web.
- ICT Helps to Boost Business Says New Research. Public Technology. net. 2008.
- Information and Communications Technologies. Canada. 2008. Web.
- Meeting of the OECD Council at Ministerial Level. OECD. 2003.
- Mari, Angelica. Technology Boosts Tesco Results. Computing.co.uk. 2008. Web.
- The Options in Our Trust Assured Managed Identity Service. RBS: The Royal Bank of Scotland. 2008.
- Wal-Mart to Kick Off Satellite Communication system: Still Development. BNET: The Go Tom Place for Management. 1985.