Managing Information Technology in Small Business - Term Paper Example

Managing Information Technology in Small Business EXECUTIVE SUMMARY This is a case organization proposal involving Tebrak Construction Company. The proposal provides a discussion on the background information of the company including a brief analysis of the operations of the company and its performance since it was established. This is followed by a description of technological advancement and management philosophies before there was an introduction of an IT project. The case organization also discusses the experience brought about by the IT project and concludes by providing a discussion of the current challenges facing the company together with a number of recommended solutions. ORGANIZATION BACKGROUND Tebrak is a construction company that was established in 1979. The company was registered and started its operations in Riyadh City, Saudi Arabia. It was initially started as a family business and had 30 employees at the time it was being incorporated. Tebrak managed to grow its workforce and by 1995, the company had employed more than 250 workers. In the year 2000, the company was classified level B. The company also managed to diversify its operations and in 2005 it commenced the supply of medical equipment and devices to hospitals. The company has been managed by a family with the assistance of twelve management level employees in each company. It has also recorded approximately 200 million Saudi Riyal in sales revenue. This has seen Tebrak grow into a large company that has been offering significant employment opportunities to the residents of Riyadh city. Despite the robust growth of Tebrak, there was the issue of centralization of decision making. Decision making was for a long time restricted to top level management. The lower level of management was never involved in any decision making process. This restricted participation in decision making never provided freedom of decision making (Aksoy & DeNardis, 2007). The top level of management was involved in strategic planning while the lower level was involved in the implementation of policies devised by the top management. The organization managed to emerge as the market leader in an industry that was very competitive with large firms dominating the industry. Tebrak had adequate capital that saw the company invest in a number of economically viable projects that sustained its profitability for a very long time. There was less use of technology during the early 1990s and most of the firms were unable to remain competitive. This resulted in the exit of a number of companies because of decreasing profit margins. SETTING THE STAGE For over twenty years, Tebrak has been operating a manual system in collecting, recording, storing and disseminating organizational information. Information was done on paperwork and the organization managed to establish a filing system that stored company information. The company was involved in frequent upgrade of its filing systems because it was involved in numerous transactions which required large volumes of information which in turn required large space for storage. Oman was in charge of the department of information and was given the responsibility of managing the storage of organizational information. He was also involved in the upgrade process that was taking place in the company’s filing system every year. Files were being stored in a separate room like a library. The file room had security personnel who ensured that information was safe and that nobody made access to the room without permission from the relevant authorities. Individuals using the room were required to register with the security personnel so as to ensure that there was accountability among users of information. The top management relied on organizational information for decision making. The company would retrieve information and make it available before any meeting. Meetings at Tebrak were characterized by the presence of numerous files that were very large in size. A lot of time was spent in getting the right information hence the meeting took long periods of time. The meetings would even last for more than six hours. Large volumes of files were moving from one organization department to the other and in the process some files would go missing. The management of the company valued information and any employee involved in loss of information was subjected to punishment. Consistent loss of information through lost files resulted in workers losing their jobs because the management of Tebrak believed that such incidents were conspiracies involving employees and competing firms. In 1990, it was revealed that some company information had leaked to competitors. This led to the company adopting the use of computers in data storage. Tebrak purchased a number of computers that were used for data storage within the company. The company slowly transformed its data storage system through the use of computers in all of its departments. Company secretaries were involved in the compilation of information within the organization and the use of computers was limited to secretaries and senior managers only. Most of the computers were used within the office of three top management officials that included Aziz, Othman and Ahmad. Athman was the COE of the construction company, COE of the medical department and Ahmad was the CIO for both departments (Laube & Zammuto, 2003). The challenge with the adoption of the use of computers within the organization was that very few employees had the opportunity to utilize the use of computers. As noted earlier on, only secretaries and senior managers had access to the use of computers for data storage. This meant that there was still the use of files and manual data storage systems within the organization. There was little technological advancement but one that did not have significant changes in the information system of the organization. The computers were very few to meet all the needs of the organization during the early 1990s. Despite facing a number of challenges, Tebrak was determined to overhaul its information system. The company was facing the threat of losing on competition because it was recording very high costs in storing organizational information. There was an urgent need to introduce new technologies in the management of its information systems. There were a number of concerns that the organization was making efforts to address. The first thing that the organization did was to conduct a comprehensive evaluation of the company information systems to identify the weak areas that needed to be improved upon. The second step involved the organization allocating time and capital towards the implementation of the recommendations of the evaluation process. The two processes were managed by the three managers of the organization since they had a very long working experience with the organization. The managers hired external experts of organizational information systems who conducted the evaluation for a period of three months and provided comprehensive recommendations that addressed key areas within the organization. The areas included technological concerns, technology components, management, organizational concerns and, technology resources and constraints. The overall strategy to address the problems within the organization was the formation of an Information technology department. CASE DESCRIPTION Technology concerns As noted earlier on, Tebrak was using a manual organizational information system that required a lot of paperwork. The formation of the IT department was aimed at addressing the challenges that the organization was facing. Information technology had the advantage of increasing communication among the different departments within the organization. Tebrak had two main departments including the medical and construction departments. Since the two departments had a close relationship, it was important that there was an improvement in communication so as to facilitate sharing of ideas and improve decision making. Despite the efforts of the organization to design an IT department, there were a number of concerns regarding the adoption of new technology in the organization. The main technological concern was that the personnel had limited knowledge on the operations and implementation of the new Information Technology. The new technology involved a shift from paperwork to computerized data storage. However, the organization had relied on the use of the manual data storage system and a significant number had difficulties using a computerized data storage system. Tebrak was forced to train its personnel on the use of the new technology. Ahmad was in charge of the new Information Technology department and ensured that the organization was doing the best to improve its information network. He ensured that all the employees of the organization including the managers were trained on how to use the new technology. The training program was administered at two distinct levels that included general and specialized levels (Tsai, 2003). The general level was to provide basic knowledge on the use of the new Information technology whereas the specialized level was aimed at providing expertise knowledge. Technology components In the year 2006, Tebrak had a total of 1279 employees and approximately 20 computers within the organization. This was a very small number of technology components compared to the number of users. There was a lot of strain on the available technology components for the simple reason that they were limited in number. The ratio was determined to be 63 users per computer. The organization was able to order for additional computers so as to reduce the ratio of users per computers to a smaller figure. Each department within the organization received a number of computers that were aimed at improving data storage and reduce the use of manual data storage in the organization. Adequate technology components such as computers, printers and photocopier machines were made available in each of the departments of the organization. These components provided the foundation for the establishment of an improved data storage system that incorporated the use of the latest technology at that time. Employees were also taught on how to use different technology components. A number of technicians were also hired to ensure that the technology components were in order and that they were repaired whenever they experienced problems. Technology components were supervised, serviced and repaired after every six months just to ensure that they met the minimum standards. There were a lot of risks associated with technology components and Ahmad made sure that the various technology components were free from such risks. The main risk was virus attacks on computers. Computers were very vulnerable to virus attacks that were emanating from unsecured sources of data while other virus attacks were initiated by competitors. Competing businesses that were interested in getting Tebrak’s information systems slow down or completely destroyed. Tebrak managed to secure its technology components through the use of antivirus on its computers. This neutralized virus attacks on computers hence making it difficult for viruses to attack. Virus attacks had tremendous consequences and in most cases, the organization lost vital information and some of the technology components got completely destroyed (Tsai, 2003). However, the use of antivirus software ensured that such challenges were under check. Management Organizational decision making heavily relied on the Information Technology department because the decisions of the company depended on the availability of information. The IT department collected information from different departments of the organizations and ensured that such was made available to the management of the company in the shortest time possible for analysis. The IT department designed an information system that allowed sharing of information between the different departments of Tebrak. This ensured that each department had access to information from other departments hence it was easy to make decisions that involved more than one department within the same organization (Burgess, 2002). The management of Tebrak ensured that its organizational information was secured by creating passwords for different storage media. Computers were protected from unauthorized access by designing passwords that only authorized individuals had access to. Access to company website also required a username and a personal password. Only registered members were able to have access to online information. Technology resources and constraints Tebrak was using utilizing the use of technology resources such as the internet and cloud technology. The internet allowed the company to have access to a wide information database that was made accessible across the globe. The company was able to design a company website that contained information such as the services and products that the company was offering among other useful information. Cloud technology allowed the company to share resources between multiple computers and other devices over the internet. An example of cloud technology used by the organization was the use of electronic email. The organization was able to communicate with clients and its employees using electronic mail over the internet. This enhanced communication because messages were sent and received instantly despite the location of the receiver as long as there was internet connection. The use of the internet and cloud technology had a number of constraints including vulnerability to information leakages and virus attacks. The use of the email posed a number of threats to the organization including the possibility of unauthorized persons hacking emails and even the company website. This resulted in the organization losing vital information to unauthorized individuals. Downloading of information from the internet posed the risk of technology components especially computers getting virus attacks. In most cases, this occurred when there was downloading of data from unsecured sites. Tebrak was forced to secure its internet connections by securing its firewall to prevent virus attacks. The website was also secured by limiting the number of visitors to registered individuals only. Organizational concerns One of the major organizational concerns was the integration of the IT department into the operations of the organization. The IT department was an important department within the organization and as such Tebrak was very keen to ensure that the department was well integrated with other departments. Tebrak incorporated the IT department within its daily functions by making it dependent on other departments. This was because the department was charged with the responsibility of collecting information from all the departments and making sure that the information met the standards of the new technology. The other concern was the cost of designing and implementing the new IT department within the organization. Tebrak was making a shift from manual information systems to computerized information systems. This implied that the company was spending a lot of capital in acquiring the new technology. The concern then was how to raise the capital and what amount of capital was to be allocated to the project. However, the company was able to raise capital through profits and loans from financial institutions and allocated about 50 million Saudi riyal to the project (Laube & Zammuto, 2003). CURRENT CHALLENGES/PROBLEMS FACING THE ORGANIZATION Tebrak was able to design and introduce an IT department that saw the company shift from a manual information system to a computerized system. This had a tremendous impact on the operation of the organization in a number of ways. The organization was able to share information among multiple functions of the organization such as departments. The organization was also able to process information at a very high speed. Despite the milestone developments in the information systems of the company, there are a number of challenges that the organization is currently facing (Gottschalk, 2007). The main challenge is that a number of employees have not learnt to use computers. The IT department under the leadership of Ahmad designed a training program for all the employees within the organization to get acquainted with the use of computers. It is rather unfortunate that some of the employees have not learnt on how to use and operate computers. This can be explained by the fact that most of them were involved in the use of the manual filing system for a very long period of time. The employees are having difficulties adapting to a new way of doing things in the organization. The other current challenge facing the organization is the fact that access to the company official website is restricted to registered members only. This denies potential customers access to information about the company and its services. The company is also facing the challenge to upgrade its information technology systems on a regular basis because the field of technology is very dynamic. There have been new discoveries with short time periods which have resulted in most of the technology becoming obsolete and irrelevant. For instance, antivirus software is updated on an annual basis in an effort to counter the increasing risk of virus attacks on technology components (Carr, 2004). The evolution of portable computers such as laptops and palmtops has also rendered desktops obsolete and irrelevant. Despite Tebrak facing the above mentioned challenges, there are a number of solutions to the problems. One of the solutions is that the organization should consider hiring new employees with relevant skills and knowledge on the use of computer. This will aid the organization in getting the best talent that can steer the company ahead in adopting the use of new technology instead of spending a lot of time training employees who are unable to learn fast (Aksoy & DeNardis, 2007). The other solution is that Tebrak should consider not revealing sensitive information on its official website so as to avoid the risk of losing such information during incidences of hacking. The organization can therefore allow free visits to the website without registration. Finally, the company should consider acquiring technologies that have a long life so as to reduce the cost of replacing such technologies when they become obsolete. References Aksoy, P., & DeNardis, L. (2007). Information Technology in Theory. New York: Cengage Learning. Burgess, S. (2002). Managing information technology in small business: challenges and solutions. Chicago: Idea Group Inc (IGI). Carr, N. (2004). Does IT matter?: information technology and the corrosion of competitive advantage. Harvard Business School Press. New York: Harvard Business Press. Gottschalk, P. (2007). Business Dynamics in Information Technology. Chicago: Idea Group Inc (IGI). Laube, R., & Zammuto, R. (2003). Business-driven information technology: answers to 100 critical questions for every manager. Stanford: Stanford University Press. Tsai, H. (2003). Information technology and business process reengineering: new perspectives and strategies. New York: Greenwood Publishing Group. Read More