Introduction
The phrase “transnational IT operations” is used to describe the process or different organizations going beyond geographical and national boundaries for purposes of extending their business ventures using IT facilities. The process of creating a world wide market has ended up making new growth opportunities for many companies. As articulated by Boudreu, Loch, Robey and Straub (1998) it is almost a requirement nowadays that for any business to be successful, it has to expand itself to a global level. Additionally, any organization that is planning to go global would best opt for the adoption of “transnational organization” as the model for making enterprises at a multinational level (Boudreu et al, 1998)
Aspects of Transnational IT operations
The field of transnational information technology has overt time gained the synonymy with IT outsourcing (Palvia, Palvia & Zigli, 1992). An apparent increase in global bandwidth and the improvement in its global availability have been supporting issues for transnational IT operations. Additionally, cheaper paying rates and the upsurge of international organizations that are in deep need of bringing external IT skills onboard so as to diversify and improve their market outreach, are factors that have fueled the process as well. Albeit information technology is all about the modus operandi that basically goes beyond local, national and international borders, it is the different personalities within different organizations that have been the driving force pushing IT to such advanced levels.
As explained by Khosrowpour (2001) transnational IT operations have the engine driving the economical, technological, socio- cultural and political developments within the realms of the global market. As a result, such ventures have made the establishment and repositioning of resources and facilities to other countries to be enriching and profitable.
Strategies by different organization to decentralize their business operations have reduced the geographical distances; a fact that has the potential of growing even more as more countries get accustomed to the issue of globalization. At this rate, IT relations between different international organizations stand a chance of progressing to the level of international agreements between different states with regard to hiring and positioning of Information Technology resources.
Advantages of Transnational IT Operations
Transnational IT Operations would most definitely improve on the profits within an organization. This basically because, the market place is increased, more customers are available for supply of IT services and therefore more returns are given to the company. Additionally, costs of business operations are also reduced simply because an organization is able to carry out business activities at a global level without necessarily having to make trips to the locations physically (Palvia et al, 1992). In this case, the resources of time, energy and finances are minimally invested but at the same time, a lot is covered and done.
Transnational IT operations are also very effective means of improving the supply chain (Khosrowpour, 2001). In this case, the constituents of mechanisms involved in providing business services and products to the consumer by the organizations are not only increased in quantity but are also augmented in quality. The idea about transnational IT operations is that many organizations become networked as well as business and corporate individuals, who increase the systems through which business services and products are delivered to the consumer. Furthermore, transnational IT operations better the technology used in international business operations and therefore the supply chain is advanced in technology, organizations and professionals.
Moreover, transnational IT operations attract global talents, in this case, an organization is served by employees who are better qualified and more committed to helping the organization meet its objectives. As a result, the organization advances to provide better services to its customers, hence the business gains in terms of having an increase in market. Further more, operations of the organization are going to be improved as far as authenticity of IT resources and service delivery is concerned.
Disadvantages of Transnational IT Operations
Transnational IT operations also face the risk of businesses succumbing to political instabilities in the host countries. In this case, the principal organization although with the right business objectives, and principles, faces an unexpected disaster that emanates from the uncomfortable environment of the host country. Furthermore, the host country could be having or come up with laws of product liability that are too deserting to the organization extending its transnational IT services (Palvia et al, 1992). Such matters would make it risky for the business and warrant unforeseen expanses.
Host countries could also have IT exporting restrictions so that some IT facilities best for the business operations are not allowed in a particular business location. Such demerits in addition to unstable tax rates will end up lowering business operations of the organization. In addition, language variation could be another challenge, where by the host country has employees who have a hard time communicating with the transnational organization. Such matters will cause poor service delivery and also misunderstandings in both script and vocal communication.
Issues Related to Transnational IT Operations
Transnational IT operations in different organizations will involve transfer of work. This basically means that there is going to be a lot of outsourcing, especially in terms of call centers, support and the development of applications. The nature of these tasks will require that the organization and vendor continue mutual operations to ensure that the customers get the best service delivery from the organization. Additionally, transfer of work would require that the origination drafts a standardized language of work transfer in cases where language and communication seem to be a challenge.
If such matters are not worked out, transfer of work will initiate loses that will be too large to recover from. Legal differences between different countries of transnational IT operations could cause loses. In this case, transfer of work need to be done with critical considerations of the different legal systems so as to avoid pit falls within the organization. Matters of labor within the host country need to be researched and looked at as well, so that the most qualified and affordable employees are trusted with the works transferred (Khosrowpour, 2001).
The quality of work in transnational IT operations needs to be critically looked at, since outsourcing can end up having works being done by a person who does not share the organization’s objectives. Therefore there needs to be a closer look at how the employee’s attitude towards the work. In this case, quality of work will be pushed high since only the positive minded workforce is maintained. This becomes a critical step in making sure that the business thrives within the host country.
As concerns global networking there is need to develop them to the most progressed level before any transnational IT operation can become successful (Boudreu et al, 1998). It is of no doubt, that apart from the India, not many countries get a lot of mutual transnational operations from either the USA or Europe. This is because India has over time developed her IT technology so that networking with other countries is made easier. Additionally, other infrastructure including telecommunications and transport need to upped so that global networking as a venture is made easy.
Service levels will ultimately be affected by the discussed issues of global networking, quality issues and transfer of work. For service levels to be at their best, global networking has to be smooth without any difficulties in IT communication systems whatsoever. Furthermore, the employees have to be committed to make sure the best of work quality out of assigned tasks is give. When transfer of work faces the least of challenges, service levels will definitely improve. These factors are interdependent.
On the other hand, matters of cultural diversity get to seriously affect the transnational IT operations. Contemplating countries with a hardworking culture such as India would prove to be the best direction for an organization to take. Nevertheless, such a culture might be coupled with failure to take corrections and advices positively. In such a case, all options have to be researched and weighed for the better good of the organization. At the same time, language differences is a matter to be seriously considered when going for a transnational IT operations because communication makes the most basic level of success. In cases where a host country needs to be chosen with language differences, provisions for multilingual employees should be made to ease operations.
Finally, local customs and control issues need to be critically considered because they are going to seriously affect the operations. On the other hand, technological infrastructure should also be considered because in cases where there is a high business potential and the technological infrastructure is poor, exports can be supplemented. However, such exports are going to solely depend on the local customs and the control issues of the host country (Boudreu et al, 1998).
Reference List
Boudreu, C., M., Loch, D., K., Robey, D., & Straub, D. (1998). Going Global: Using information technology to advance the competitiveness of the virtual transnational organization. Web.
Khosrowpour, M. (2001). Managing information technology in a global environment. UK: Idea Group Inc.
Palvia, S., Palvia, P. & Zigli, R. (1992). Global issues of information technology management. London: Idea Group Inc.