Contribution of IT to Changing an Organization
Executive Summary
information technology is a huge topic of consideration in most of the organizations. The new changes in technology has compelled the businesses, to leverage on its benefits which streams from the financial management, coordination of employees, understanding the customers among others. Amazon, as a case study of reference is notable for employment of IT in the supply chain management, by the use of artificial intelligence. The adoption has revolutionized the way things are done within the company by improving the customers’ relation, through fastening the distribution of products. Also, the use of Google analytics to understand the needs of the customers has eased the management of supply chain, thus refining the brand image. In the same vein, the challenges of implementing the IT systems in Amazon are categorized into internal politics, changing technology and online frauds. To curb the mentioned glitches, among the strategies that could be utilized are beefing up the online security and educating the employees and customers on the significance of protecting their personal data. The overall effect is trust among the company and stakeholders.
How IT /IS can contribute to changing an Organization.
The arena of technology is changing the way things are operated in different companies, streaming from manufacturing to the services industries. A plethora of businesseshave embraced modern technology due to the opportunities presented, in the form of reduced human labor, thus cutting on cost. In the same vein, the activities are executed faster, which improves the returns. In the modern world, institutions are competing on the incorporation of the IT systems, to override the rivals, thus making the competition stiff to manage. The case study of interest is Amazon, that has grown from a humble beginning to the current corporation that is commanding the market in disseminating of knowledge. Owned by Jeff Bezos, the company has managed to tenure the different seasons in technology, to an enigma corporation that is taking the lead in the selling of books, either in soft, hard copies and even distributing videos for knowledge sharing. According to Schu (2017, p.86), one element that has made the company grow to such a vast entity is its embracement of IT. He noted that changing technology transforms the lifestyle of the consumers, hence the need to go along with the changes.
Headquartered inSeattle, the company has a considerable base of employees in all its retail shops averaging to close to 647,500 by the year 2018(Amazon 2019, n.p). For the fiscal year 2018, Amazon reported annual revenue of US$177.866 billion, an increase of 30.8% over the previous fiscal cycle (Amazon 2019, n.p). Considering the nature of the industry, relying only on human labor would make it hard to manage divergent consumers and employees who are in different countries. Some of the authors such as Andersen et al. (n.d) noted that Amazon is unstoppable to its path to development, since they unveil new ideas often, to reach to more customers. The company does so through aggressive innovations and creativity in its retail business, which has helped it to remain abreast with the current vicissitudes in the market.
How IT has Contributed to the Success of Amazon
As noted in the previous paragraphs, the initial success of Amazon lies in modern technology. As pointed out by Fry and Manna (2016, n.d), the only way a company can be able to succeed in the contemporary market, is through embracing a technology, that can revolutionize the way things are done. Among the critical areas, he considered essential to align with technology is the production process and controlling the employees. In regards to Amazon, the company has been able to improve the way the digital content is spread, and accessed by the customers. During the start of the business, the IT knowledge was not rampant as it is today. Therefore, the company’s web store could not afford to accommodate all the libraries in the world, due to the issue of database instability and unreliable servers, which could not upload massive data.
Rudolph (2017, p.87) noted that the progress of any organization lies solely on its innovativeness and creativity in dealing with customers, suppliers, and other stakeholders in the market. One way the IT has contributed to the success of Amazon is improving the customers’ relation. In the modeled and complex market, understanding the needs of the consumers is optimal. This helps in determining the right channel of distribution and the kind of content to distribute. Amazon has achieved this by introducing the prime air, which principally entails on use of drones to drop the package ordered at the doorsteps of the buyer. The system permits the company to deliver the books in less than 30 minutes, something that has drawn attraction among other retailers. Likewise, the company has streamlined the way the purchaser orders the product by introducing one-click purchases. This is a button on the website, that makes it easy for the customer to order instantly, instead of navigating through several pages trying to make an order. In the same vein, cloud computing has empowered the company’s web services to run faster and in a smarter way. With these changes, among others, the customer’s experience is highly improved. The company projects to make$14 billion by the end of the year 2019, which is an increase to 4.2% from 3.2 % in the year 2018(Amazon 2019, n.p).
In the same vein, leveraging on Google analytics and artificial intelligence are a huge plus to the company, in regards to understanding the nature of the customers they deal with. Andersen et al. (n.d) propounds that modern customers have primarily changed, due to the cyclical lifestyles that are dependent on the market and economic environment. It was noted that more than before, institutions such as universities are focusing on consuming books online, rather than buying the hard copies (Fry and Manna 2016, n.d). To understand such kind of a revelation, it is challenging to conduct manual surveys, but instead interpreting the buying behaviors and customer’s responses would give a shorter lead. Google analytics extract massive data from online sources and presents it in a more straightforward manner that can be utilized to make marketing decisions (Fry and Manna 2016, n.d). Similarly, artificial intelligence saves on cost, as witnessed by the current use of drones to send the packages at less time.
Furthermore, the company has utilized the knowledge in IT to improve its supply chain management. Rudolph (2017, p.54), in his study, noted that most of the delays of the ordered products begin within the organization and largely contributed to bythe packaging of the items. Amazon has been able to override this problem, by use of Amazon robots, that issuper-fast. The migration to such a system not only conveniences the customers but also lowers cost on the side of the company. The delivery option for customers is also shortened, as drones can avail the products within a short period. Withal, the management of inventory is something that distracts the operations of the companies, that operate overseas and with a massive base of clients and customers. Amazon has introduced inventory management technologies, that consolidates the sellers, buyers, and other stakeholder on the same database. This makes it easy to trace the products that are out of stock and helps to analyze feedback regarding the customers.
Challenges of Implementing Information Technology at Amazon
Information system allows an organization to extend its services far beyond the areas of operations, and cover a huge base of customers. This has been made possible by the use of modern technologies, where the organization is able to connect with the clients online, without necessarily meeting them physically. Although IT is thought of as instrumental in streamlining the activities in any organization, it faces a number of impediment arising from the within the company, and outside. In regard to the Amazon, it can be cited as one of the superior brand, that has managed to incorporate the IT, to meet the surging demands of the customers. Extending from offering the book services, Amazon is currently able to cut through the market by employing the correspondingly high rate technology that serves the customers at a faster rate. Beynon-Davies (2013, p.30) noted that to fulfill the requirement of information, management of the same is required for the prosperity of an organization. This is a strategy that has been adopted by Amazon, thus resulting in its proliferated growth within a short span of time.
A number of surveys have been conducted to establish some of the challenges that face an organization, in the path of implementing the IT in its operations. Abu-Taieh et al. (2009, p.257) conducted a survey of twenty most influential retail companies and interviewed the top management, to establish the main cause of the delayed acquisition of the information technology. In the response, one of the issues that topped was lack of top-management commitment towards the implementation of modern technology. A similar proposition is seconded by Singla (n.d,200), who affirmed that lack of management is an impactful issue for a large corporation, which is aiming to compete with superior brands in the market. In regards to the Amazon, lack of goodwill from the top management could be highlighted as the main reason, that can encumber the implementation of modern technology. However, based on the operations of this company, it is certain that the management has been able to override this problem because the business is employing more advanced technologies such as artificial intelligence in supply chain management.
In the Same vein, Beynon-Davies (2013, p.28) noted that politics and conflict within the management in Amazon could be the influencer of the derailed implementation of the IT solutions. Just like any other organization, wrangles within the business not only harm the owner but also impacts negatively on the relationship among the employees. The workers could be resistant to any move, that would expose them to more risk of losing a job, and Babaei et al. (2015, p.25) cite this as the major reason why the employees are adamant. In the same vein lack of proper training threatens the workers, as they feel incompetent to utilize the new changes. Furthermore, Abu-Taieh et al. (2009, p.257) is of the idea that strategic planning consumes much of the time, that could have been used to do other productive work. In the case of Amazon, the planning of introducing IT entails understanding the customers who are globally spread. Any move to make slight change affect millions of customers, who rely on the products of this organization to satisfy their needs. The strategic planning begins with the launching phase, which primarily entails exposing to the employees, customers, and other stakeholders, of the new changes in the IT. This could be introducing a new system, that aims to improve the services delivery. It is later followed by the plan development stage, that seeks to identify the loopholes that can stop the process, and improve the functionality. The final stage is implementation and integration into the company. This process is ideally large and takes time, and is costly. The company(Amazon) could choose to drop an idea, if it takes much of the productive time, and if the returns of the implementing a scheme do not conform to the expenditure.
The other major issue that has faced Amazon is ever changing technology (Amazon 2019, n.p). In the wake of globalization, organizations are looking for innovative ways to remain ahead of the rivals, and this can only be achieved through using superior technologies. The adoption has been achieved in areas such as marketing, management of inventories, understanding the spending behavior of the customers among others. Over time, Amazon has continually changed its mode of operations, to meet the demands of increasing customers and also to protect the brand image. Initially, the books could be shipped to the customers, and this took a number of days. Currently, the dronesare used to supply books, and the most interesting part is that the customers can order and download books on their computers. The observed changes render some old models obsolete, and the company sometimes become reluctant to embrace the new changes as they are costly and expensive to maintain.
Furthermore, (Amazon 2019, n.p) noted that the guaranteed money back for online purchases of orders of more than $250increased the chances of frauds, which has to some extent amplified the chances of fearing in utilizing the modern technology. The cases of cyber insecurity are a point of concern for almost all organizations, and most of them have reported having lost a huge amount of funds due to this malpractice. Amazon being an online business is on the receiving end of the online aggressors, who either siphon the company’s money or defraud the customers who pay using cards or other online payment methods.
Solutions to the Challenges of using IT/IS in Amazon
The most striking problem of the use of IT in Amazon is the cases of online fraud. According to Andersen et al.(n.d,34), cyber insecurity maims the performance of any organization, and lack of careful consideration of the issue can have engraved effects, such as tainting the brand of the company. Amazon is an international brand whose products have found acceptance and use among all ages, streaming from the kids’ content to the old people. To curb the cases of fraud, the company should come up with a team, that is primarily focused on dealing with online security. Any chance to steal from the customer or the company should be identified early, by use of specialized software that can be able to utilize the machine learning to identify the aggressors. In the same vein, the management should educate both the employees and the customers on the ways to protect themselves from the hackers, who infringes into the confidential information of either party.
Furthermore, the lack of goodwill by the employees and management can be solved through communicating the importance of IT in the business. Lack of information leaves the people speculating of things that are not true. This is because the workers perceive new technology as a way to deny them jobs, which is a wrong stand. Incorporating the IT in an organization purposes to streamline the activities, and improve the service delivery to the customers. For example, human beings cannot be able to interpret huge data, hence the need for IT. Therefore, Amazon’s management team should consider educating the employees on the need for appreciating the new technology. Likewise, the management should coordinate the strategic planning of activities to reduce the time latency in the implementation of information technology.
Conclusion
Amazon prides itself as one of the largest global retailers, with a huge base of customers spilling from different geographic locations. Such, IT has persistently changed the way it operates, by improving customer relations. This has been made possible by availing the products in a timely manner and reaching the customers at their doorsteps. Also, the utilization of google analytics to understand the demands of the clients has assisted in stocking the books, whose readability are high. Similarly, the IT system has enhanced supply chain management. Some of the challenges in the implementation of the IT in Amazon includes internal politics, changing technology, and online fraud, while the suggested solutions entail beefing up on internet security and educating the employees/customers on possible loopholes utilized by online aggressors.
