Impact of Technology Essay

AbstractThe teaching engine room cloakments bring ontogenesisd signifi shadowertly with condemnation and advancement in engine room. In this clear, an attempt is made to highlight how the data engine room influences the organization profitableness. The cor sex act coefficient between the discipline engineering (IT) and productiveness was very argumentative. Many studies were conducted to identify the impact of IT on productiveness conclude different results. It is unworkable to estimate the productivity evolution due to the availability of so many an(prenominal) advanced data shapeor technologies, as its tough to consider in all parameters involved while work proscribed productivity growth. Several researches and studies were documented stating arrogant do of IT on productivity growth. But still on that point were few against this statement.IntroductionThe advancement in the information technology made both consumers and business enterprises to role it. C omputers, laptops, wireless communications etc. argon all part of IT and incorporated in every industry. Enterprises invest in these technologies beca intention it was assumed technologies will call forth productivity. Companies aim to generate more business and high turnovers through and through less enthronization. In a race to gain more efficiency, the enterprises atomic number 18 adapting new-sprung(prenominal) technologies. Huge investments argon made on new technologies to survive in industry. The major challenge is to produce high superior goods and services at low prices. Some enterprises understood thevalue and importance of information technology and apply it to deliver more products in less time and more reliable and convenient services at lower cost. This will also help to gain combative advantage over rivals. It was illustrated in a study to generate high productivity growths from information technology enterprises should change the existing infrastructure as w ell as business practices (Brynjolfsson & Brown, 2005).Many enterprises changed the organizational structure to exploit the full potential of information technology and its applications. Brynjolfsson and Hitt (1998) linked productivity with living standards to understand it better. They mentioned that value of productivity laughingstock be well understood when related with our living standards. They highlighted the signifi coffin nailce of productivity by comparing it with our living standards and mentioned that, productivity growth determines our living standards and the wealth of nations. This reflects the guests behavior to consume more in less money. They also point out that the concept of productivity is simple and vast but tough to footfall with accuracy. Information Technology and productivenessproductiveness was described as the amount of output generated for a certain amount of input signal (Brynjolfsson, 2003 Hitt & Brynjolfsson, 1995). Productivity chiffonier also b e defined as the measure of the quantity of outputs in goods and services per whole of input (Muriwai, 2006). Productivity tramp be measured either by c are the output inactive or input. Productivity can be change magnitude with increase in output keeping input invariant or by decreasing the input keeping the output static. The term information technology was defined narrowly as the expenditures made on the computing hardw be (Brynjolfsson, 2003 and Hitt & Brynjolfsson, 2005). It was elaborated a miniature more as. All the computer software and hardware, tools and services used in the business processes and operations are a part of information technology. The investments in information technology were defined as the expenses on the computer hardware and software and all other devices related with IT (Morrison, 1997).The main persona of these investments is developing a new-made infrastructure within the organization to boost productivity of both organization and employees ( Dehning, Dow, & Stratopoulus, 2003). It was documented by Mahmood and Mann (2005) thatinvestment in IT was not sufficient enough to increase productivity. Strategic decisions had to be made whether investment in IT would help to accomplish objectives and goals put. A harmony moldiness occur between IT investments and changes in business process to clear high productivity growth, even greater than investment in information technology. Keller (2004) also express that when IT is utilized appropriately at workplace that also helps a lot in productivity growth. exactly investing in information technology is not sufficient to gain growth in productivity but organization can visualize changes brought by information technology (Brynjolfsson & Hitt, 1998 Dedrick, Gurbaxani & Kraemer, 2003).A significant relation between IT investments per employee and overall productivity of company was found by Brynjolfsson (2003). The enterprises gained high productivity growth who invested ample sum in information technology trenchantly. But pattern of productivity growth across the enterprises vary no doubt the return from IT investment were compulsive (Brynjolfsson & Hitt, 1998). It takes time to realize productivity gains from investments in information technology. It was supported by Mahmood and Mann (1988) that productivity growth and performance of the organization improves in time period of ii or three years after investing in information technology. Dedrick et al. (2003) also believed that productivity gains are recognise after a long time period. It was highlighted in their research that information technology payoffs are high when firms effectively apply information technology in long run.Its easy to measure productivity when tangible products and goods are produced as in the manufacturing sector. An input alteration in the manufacturing process can bring substantial changes in productivity. For instance, the use of automation technology and robotics produce outp uts of good quality (Kao & Liu, 2005). On the contrary, its tough to measure and improve productivity in service sector. Its next to impossible to evaluate the productivity of an employee. A method was proposed by Tallon and Kraemer (2006) to measure precisely the impact of information technology on productivity. A method of perceptual measures was recommended by them. Perceptual measures would bring new scope to study impact of technology on productivity. They described it as perceptual measures, if structured around information technology impacts at the process- aim, can impart richer insights than objective criteria alone.Authors Agree and DisagreeThe research was wear offe by many to study the impact of IT on productivity (Brynjolfsson & Brown, 2005 Brynjolfsson & Hitt, 1998 Melville, Kraemer & Gurbaxani, 2004 and Kudyba, 2004). The expectation that productivity will certainly increase by utilizing the IT were not always true. But researches ended up with different conclusions , some stated positive impacts of IT on productivity and others negative.Information technology had negative impact on productivity. Mahmood and Mann (2005) mentioned in their study that in that location is no adequate evidence available in past researches showing the positive effects of IT on productivity. It was also supported by Dedrick et al. (2003) stating, Studies have failed to identify a relationship between information technology investment and firm profitability. The term productivity paradox was introduced by Robert Solow in 1987 explaining the inability of the information technology contributing towards firm productivity (Solow. 1987). He made a statement that growth in productivity was not accompanied by the information technology. He also discussed that the companies didnt had expected results in productivity after investing in Information technology. He quoted, You can see the computer age everyplace but in the productivity statistics. In my opinion and during my res earch I realized that impact of IT on productivity had mixed reviews from different authors, researchers and economists.Researchers used new approach to reveal the hidden positive effects of IT on productivity. Brynjolfsson and Hitt (1998) illustrated that Information technology has a positive and significant impact on firm output, contradicting the claims of a productivity paradox (p52). This was also supported by Brynjolfsson (2003) and Dedrick et al. (2003) that productivity including the output per worker annually had increased significantly with use of information technology. It was mentioned by Kudyba (2004) that the output can be upraised with increased information technology skills. The new information technology and techniques effectively when used by the companies, those companies are productive than who dont use it (Brynjolfsson & Brown, 2005). When the technologies and techniques were used perfectly and timely, yield high level of productivity.The three ways werediscusse d by Brynjolfsson (2003), Keller (2004) and Brynjolfsson & Hitt (1998) to own productivity growth from IT by decreasing the cost on Information technology and keeping the benefits from business stagnant increase the benefits from business and keeping the investment in Information technology constant or reduce the cost of information technology and benefits increase from business. The information technology is important and priceless for organization (Melville et al., 2004). They also stated that effective and efficient use of information technology can yield potential benefits, like cost reduction, improving quality and at last productivity. The companies, who used information technology effectively, had also observed an increase in price of their market share more than others. It had been reported by Mahmood and Mann (2005) that both IT labour and computer resources contribute towards return on investments.They also mentioned in their report that effective enterprises have develo ped and improved their infrastructures and investing highly in information technology. Information technology is a medium through which the information can be distributed easily within organizations. The highly advanced IT infrastructures frame an atmosphere within organization that encourages decentralized process of decision making (Brynjolfsson & Brown, 2005). When modification of the business processes is make within organizations, it becomes necessary to merge information technologies. The productivity can be enhanced by consolidation information technology investments with decentralize process of decision making (Melville et al., 2004). The integration of information technology investments and other investments within business also proves to be beneficial (Brynjolfsson & Hitt, 1998). The operations and business processes within the organization must be evaluated and ensure that existing business environment can adapt the new technology, before afterlife information techno logy investments made (Zhou & Chen, 2003).The predictable and estimated outcomes can be realized from IT investments through integration of technologies and watercourse business processes (Kudyba, 2004). It becomes important to restructure the business processes with the changing business environments when new information systems are set up (Zhou & Chen, 2003). McNamara and Watson (2005) also reported that the integration of the existing technology systems with new technologies within organizations yields the expected productivity growth.They also discussed how the existing technologies can be employed in various business operations, it equally productive as investing in new information technologies. Brynjolfsson and Hitt (1998) found that The greatest benefits of computers appear to be realized when computer investment is coupled with other complementary investments new strategies, new business processes and new organizations all appear to be important in realizing the maximum ben efit of information technology.The companies must integrate all daily activities, decentralize decision process, flow of information from high to low level, this will enhance productivity growth and all these attributes directly or indirectly contribute to information technology (Brynjolfsson, 2003). The organizations use various methods and measures like product quality, profitability, and value of market shares to measure productivity (Dedrick et al., 2003). There is a disaster that productivity can also be gained through effective management. It was observed that productivity can be increased by information technology and make worth for consumers (Hitt & Brynjolfsson, 1995). Devaraj and Kohli (2003) proposed a method which requires elevation of the IT tradition at the employees level individually and then finally investigating its effect on organizational performance. Employees of newfangled organization may call it push or pull of IT investments.This phenomenon of push or pul l in IT investments may inspire employees for using new technologies and this may lead to productivity improvements. Kudyba (2004) mentioned that competitive advantage can be gained by hiring skilled and experienced employees. In my view, the employees must be trained to use new technologies or companies should hire skilled and experienced employees. It also depends how the new technologies are being utilized by the enterprises to enhance their productivity. Only those companies will maximize their productivity that will use the technology perfectly and timely. I have also learned during my research that productivity doesnt depend on one factor, thither are number of parameters that affect the overall productivity of the organizations. The accurate methods are required for calculating the productivity, to recognize the growth of productivity. Rather than emphasising on productivity only if, enterprises should develop new strategies to integrate technologies with new opportunities. The barriers to entree can be easily terminated by raising the firms efficiency and gaining competitive advantage. Benefit to ManagerThere is a big challenge ahead for all the mangers and decision makers how to consume the information technologies at best and have maximum benefits. Its not compulsory that the companies will have same levels of productivity if provided with same information technology, it depends how the technology is utilized to have high growth in productivity (Brynjolfsson, 2003). To maintain competitive advantage in the industry, the managers had to find new ways in which they can exploit the full potential of technologies differently from their rivals. Melville et al. (2004) mentioned the competitive advantage gained through human resource and adept synergies cannot be maintained for long. A strategy or mechanism had to develop to gain competitive beach for long periods and which is not easy to imitate. The competitive advantage can be maintained until other s dont follow what you are doing, once others start following your techniques its tough to sustain competitive advantage (Brynjolfsson, 2003).I believe that managers should examine future values of all IT investments when productivity results were not up to the level of expectations. The organizational leaders are not ready to invest more on technologies, when results from previous IT investments are not beneficial enough (Devaraj & Kohli, 2003). A big challenge for the leaders to justify future investments in technologies when there is no significant evidence of productivity improvement from previously investments in information technologies (Dehning, Dow, & Stratopoulus, 2003). Managers should focus on other aspects of business process also rather than on productivity alone.Hitt and Brynjolfsson (1995) discussed that managers should concentrate more on how information technology can be used to improve product quality and customer service. Information technology has the potential t o reduce the expenses on such services and change the mode of exertion and delivery of the goods and services so cant be easily imitated by competitors (Hitt & Brynjolfsson, 1995). The uniqueness in utilizing the information technologies in business operations and processes is the key to stay ahead of the competitors in the market. This not only provides competitive advantage but also increases the overall growth in productivity. ConclusionThe conclusion can be drawn that investing in information technology doesnthave any positive impact on productivity growth until utilized properly and effectively. The impact of investing in technologies can be realized how organizations utilize technologies effectively depending on the current situations of organizations and derive expected productivity results. The initiation of telecommunication, computer software and hardware had totally changed operations within the organizations. The use of these forms of technology was extensively freque nt and in-demand among the various industrial sectors. The enterprises had changed their existing infrastructures to adapt these new technologies. The meaning both consumption and productivity have changed with innovation of information technology. Organizations across the globe are implementing new technologies to enhance the daily business activities with the purpose to survive and compete in this new global world of information technology.ReferencesBrynjolfsson, E. (2003). ROI valuation The IT productivity gap. (21). Retrieved from http//ebusiness.mit.edu/erik/ perfect/pr_roi.html. 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