How Technology affects business
How Technology affects business
Technology is an improvement over what was available in the past. People and organizations often seek technology because it eases tasks and facilitates production. With the appropriate technology, complex tasks are simplified. Man has used technology to achieve previously insurmountable tasks: walk on the moon; create test tube babies; treat life threatening diseases; predict weather; send information across the world in seconds, etc. Mark Behrsin and Bill Twibill emphasize the importance of technology in business when they write that,
Visionaries such as retail giant Wal-Mart and shipment pioneer FedEx have used technology not only to solve logistical problems, but to seize new opportunities, open new channels to market and create new business models they have forced their competitors to adopt. Wal-Mart looked to technology to improve supply chain management and steal a competitive edge. FedEx looked to the opportunities technology offered to manage the extent of its growth without finding a way to automate business processes. At the time its SuperTracker application cost a massive $100 million to develop but the investment has paid off many times over (4).
The evolution of technology often accompanies the invention of machinery which is used to accomplish the required task. For instance, advances in information technology and communication have brought about mobile phones, which are a departure from the fixed lines in the past which are connected by wires. Charles F. MacCormack recalls that,
In terms of people impact, technology has fundamentally changed the way we do business. Fifteen years ago, communications with our field organization was a matter of faxes at best, and more often mail couriers. An exchange of information could literally take weeks to complete… Now we use email, voice and video conferencing to communicate in minutes (1).
In recent years, there have been advances in various aspects of technology. However, it is important to state that while technology is often applauded for its many benefits, the phenomenon can also adversely affect businesses. This paper explores this double sided nature of technology as it affects businesses.
1.2 Thesis statement
Technology is important to human beings across the world because of the many benefits which it presents. In many ways, technology has been used to solve problems facing people in various societies. This paper examines the effect of technology on businesses. If it is obvious that technology brings a world of good to the various businesses which people are involved in, what are the problems created by technology? In other words, this paper also explores the ways in which technology adversely affects businesses.
1.3 Benefits of technology in business
In the first place technology is beneficial to business because it speeds up the production process. Speed is necessary in business because, when there are more products in a short period of time, profit is maximized. In the printing of newspapers, high speed machines are required to ensure that mass production of the newspapers is attained in the short space of time within which the newspapers are needed. This applies to all other businesses where products need to be produced or assembled for sale. Machinery is important. In bakeries as well, technology is essential because human labor is avoided because of its inefficiency and much of the work is automated. In this case, the automation by machines also ensures that hygiene. The efficiency of machines cannot be overemphasized at this point. When compared to human labor, machines offer a higher level of efficiency. With the appropriate technology in a bakery, machines can produce more loaves of bread than human effort.
Apart from the production process, technology also ensures speed in another dimension. In service delivery, vending machines are important because they serve members of the public promptly and avoid the build up of queues. Take the ordinary coffee vending machine. It would take a longer time if people were served by a waitress. However, the coffee vending machine accepts cash and provides the service at the touch of a button. Vending machines are found in banks, under ground train stations, shopping malls, etc. Also, it is important to note that Automated Teller Machines (ATM) are an important technology that is very useful in the banking industry. These ATM have eased the stressed placed on banks by its teeming customers. With the use of ATM, bank customers can enjoy hassle free self service. They only need the attention of bank staff when they have a problem with the machine or if errors are generated by the machine. The technology of the ATM has enabled banks cope with the work load and ensure that they are able to achieve more in a short period of time. In this way B. Ives and S. L. Jarvenpaa note that technology serves to expand business because with the appropriate technology they are able to take more orders and cope with more customers.
As businesses strive to beat their rivals and competitors, the technology used by these businesses is often a yardstick for determining leaders in the industry. Take the software industry for instance. Around the world, Microsoft is a leader in the industry because it has the technology that has made it stay there. Technology is also important in the health industry. Due to specialization, some hospitals and research centers are renowned for the diagnosis and treatment of some specific diseases. They are leaders in the industry because they have the technology to do so. J. Bakos and M. E. Treacy insist that technology is useful to businesses as they build their competitive strategy.
Industry leaders and secrecy
In business, the technology which enables one company stay in the lead and above other competitors is often a well kept secret. This company will never share that technology with others because it will loose its position as a leader in the industry. In medicine, the patents for the manufacture of certain drugs are owned by certain pharmaceutical companies and they are not will to give it out. Sound technology gives businesses an edge over competitors in the industry.
Advances in information technology have ensured that businesses are no longer confined to particular countries but are given a chance to be heard across the world. In the light of this, businesses can extend their boundaries to other countries of the world. Furthermore, banks too have taken advantage of information technology by establishing a network of their branches around the world. This facilitates transfers within the bank and also with other banks in the world. Information technology also facilitates electronic commerce, where people can shop on the internet and have the goods sent to them in the post. This is a faceless transaction. In a study, Steve MacFeely and Caitriona Obrien find that the productivity of firms that have e-mail and a website is higher than those who do not. The foreign exchange market as well as the stock market also benefits from information technology. Today traders in various parts of the world can trade it stock and bonds from their computers in whatever part of the world because they are connected to the Internet.
1.4 Dysfunctions of technology on business
Technology poses a number of threats to businesses. As a dynamic concept, technology is always changing and improving. In various aspects of human endeavor, there is always a drive to find new methods. When this new technology is developed and put into use, it renders the previous technology redundant and this has far reaching implications on business enterprises which use the outdated technology. In the first place, these businesses face the challenge of catching up with the current technology. This involves a lot of cost. Secondly, the businesses using outmoded technology will loose customers because the newer technology will definitely be more efficient. In the long run the profit of the business will dwindle. The photography business is an example of this phenomenon. With the introduction of digital photography which ensure instant printing of photographs, old methods of photography have become very unpopular.
Technology places extra cost on businesses. With the introduction of technology, businesses which want to keep abreast with it need to spend money to train staff on the use of the new technology. Technology often requires special training. The other alternative is to employ professionals who are versed in the processes of the new technology. Employing these kinds of professionals also places a strain on the resources of the business. Businesses that want to stay afloat need to keep up with the trends in the industry and this is one of such- but it has severe cost implications.
Technology often causes drastic change and cause unemployment. With appropriate machines occasioned by technology, many employees are laid off work. This was a feature of the industrial revolution. However, the same situation applies here with the introduction of new technology. The entire idea of technology is to improve production using machines that minimize cost but in the end maximize profit. Also, there is the notion of novelty attached to technology. Thus the inefficiency associated with human labor is eliminated.
In some cases technology is not able to deliver the benefits which are expected. Managers in various organizations may have high expectation of technology. However, it is not able to delive in many cases. Mark Behrsin and Bill Twibill write that,
It is understandable that businesses have come to distrust technology. There are almost constant reports detailing the number of technology -related projects that have failed to meet expectations. Recent research from KPMG suggests that 56 percent of publicly-listed firms have had to write off at least one technology project in the last five years as a failure (4).
Technology is essential in business but it presents some problems to businesses as well. When managers in various organizations understand these dynamics, they will succeed in their various endeavors.
University/College: University of Arkansas System
Type of paper: Thesis/Dissertation Chapter
Date: 23 September 2016
We will write a custom essay sample on How Technology affects business
for only $16.38 $12.9/page