IT strategy and business strategy
On the other hand, when we look at the IT strategy where the company wanted to equip all the external personal with Handheld computer devices(HCC), the basic goal behind this IT strategy was to relieve the company from all the paperwork on which the external team wasted their prime time and instead use that time in making sales.
With the help of the handheld computer devices, the external sales and task teams were able to generate real time information database for the top management and also they were resourced with all the necessary information that they would want in order to take the necessary decisions as soon as they were necessary to be taken. The time waste due to paper work and then sending, receiving and retrieving the final decision through the paperwork approach created a lot of problems while decision making for the company and thus an IT strategy of this type was much needed.
Now if we compare the business strategy with the IT strategy of the company, we see that both the strategies are targeted towards the same vertex of the triangle. The vertex of the triangle defines that the information database has to be centralized with the internal
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The interest of both the strategies is same therefore the company had to redesign its management processes and operations in a way that they fulfill the requirements for both the strategies in order to enable them to work simultaneously. In a nutshell, the company wanted to get the full advantage of centralization and decentralization simultaneously with the help of its new business and IT strategy. Seven Components to be reviewed The components of efficiency and productivity had to be achieved side by side through the implementation of the strategies by the company.
Although the two components hold their own significance in the company, however their scope of interests is different. I we classify the two components with their respective strategies that the company is implementing, we will see that the efficiency component is directly related to the IT strategy and productivity component is related to the business strategy. In general, terms efficiency and productivity can be interchangeably used, however, theoretically, if we look at the goals that the IT strategy is targeting, we can rightly say that the company is aiming towards being more efficient through their IT strategy.
the reason being that they are using lesser resources for the generation of data, they are incurring lesser costs regarding making, transmission and the maintenance of the information or data resources that are produced from the internal and external sources, and also the IT strategy basically targets towards decreasing the time between information transmission and consequently decision making process by the top management.
As we have already discussed in the earlier part of the essay, the new Handheld computer devices will provide all the above services and elements that will actually make the companies information transmission and management process more efficient without wastages of any sort, be it costs, time or data itself (Harvard Business Review, 1997). However, if we look at the productivity component, we will see that the micromarketing business strategy actually focuses on making the operations more productive.
The company wanted to make the right decisions at the right time with the same number of resources but increased output. When the right information at the right time will be available to the external team they will be able to make better and timely decisions regarding the marketing and sales of products. Thus, the total output per decision will increase with the same number of resources and hence the productivity of the company will increase.
An example that is given in the case study suggests that the company made around 32 divisions that had to come up with their own P&Ls regarding the costs, profits and revenues which were to be reported to the top management. The top management would then list out the worst performing divisions and then give them new targets and strategies to improve their output. Previously, the output was evaluated on cumulative basis, but through this business strategy, each division will be evaluated separately in order to see their productivity (Harvard Business Review, 1997).