11. Applications of IT

Question 1

Why is there a need for a strategic perspective on new technologies?

&

How can new technology create a competitive advantage?

Answer 1

Strategic Managers are increasingly embracing emerging technologies as a way to:-

• Innovate
• Improve performance
• ultimately get ahead of the competition

How can New Technology create a competitive advantage?

• Greater Quantity of data available - Larger amounts of data can be Collected, Organised and Stored for Analysis to help identify and exploit opportunities.
• Good for stakeholders – as this will, improve profits, create savings, improved service or functionality of products.
• Early adopters - can learn how best to deploy new technologies before rivals. Enabling an increase in market share. Experienced gained is likely to be better than rival copying you. Keeping you ahead of the curve.
• Improved Performance Metrics - Better understating of performance strengths and weaknesses of the ORG

Question 2

Define Mobile Technology with examples?

&

How has It impacted the world?

Answer 2

Mobile technology: Is concerned with technology that is portable, and devices being able to connect in new ways.

Devices:

• Laptops
• tablet computers
• smartphones

Communication features of mobile tech:

• Wi-Fi connectivity
• Bluetooth
• 4G/5G technologies
• GPS technologies

Impact:-

The impact of mobile technology has been instrumental in the increased sharing
of information around the world.

The rise in the amount of data generated and transferred between parties using mobile technologies does heighten the need for improved data protection

Question 3

What are the Pros and Risks of Mobile Technologies to businesses?

Answer 3

Benefits

• Allows mobile/remote access to company systems and data when away from the workplace.
• Easier for organisations to interact with stakeholders e.g Mobile Payments, video calling, Instant messaging.

Risks

• Costs to business can be high as Mobile tech is increasingly costly and an increased rate of obsolescence
• Increases the number of entry points for unauthorised individuals to gain access to organisational data. Orgs need to think more about the protection of systems and data.

Question 4

What is Cloud Computing?

and

What are the Benefits and Risks of Cloud Computing?

Answer 4

Cloud Computing is the on-demand availability of computer system resources, especially data storage and computing power, without direct active management by the user.

The term is generally used to describe data centres available to many users over the Internet.

Benefits

• Can be more cost-effective than operating an in-house hardware system.
• Offers greater flexibility in terms of service providers and the ability to the scalability of I.T systems faster
• Cloud data can be accessed anywhere around the world where there is internet connectivity.
• Available to both small and large organisations.
• Increased security from local physical damage

Risks

• Organisation gives up control of data to a third party.
• Data held by the service provider may be stolen, lost or corrupted.
• The increased danger that provider’s own staff may interfere with data stored.
• Failure to keep up payments for the service, you may lose access or even the deletion of data.

Question 5

How do organisations choose between Cloud computing or Owned in house technology?

Answer 5

Companies need to assess on a case by case situation as many factors will influence managements decision to go to the cloud.

Factors To Be Considered?

• Expertise: Does the company have the expertise to manage systems in house or on the cloud?
• Support: How important is it to monitor I.T infrastructure in house?
• Customisation: How much customisation does the I.T system need?
• Service Level Agreements: The type of service level agreement offered?
• Dual approach: is it practical to use both methods for I.T Infrastructure.
• Cost: can the company afford the type of system they need.

Currently, 9/10 Organisations use Cloud Tech in some form.

Question 6

How has Innovation in I.T affected data analysis and organisational knowledge?

Answer 6

Growth in organisational data

Organisations today can collect and store more data than before – about customers, suppliers, operations.

The growth of the internet, smartphones, social media, internet search engine data, (internet of things) – physical sensors, smart energy meters, RFID tags and tracking devices all create and communicate data.

Data analysis

Data on it’s own is useless without it being analysed, SAS (2016) highlight that data analytics refers to the ability to analyse and reveal insights in data which had previously been too difficult or costly, due to the volume and variability.

The aim of data analytics software and data analysis is to extract insights from this type of data is of crucial importance. That may help organisations to understand the complexity of the environment and respond swiftly to the opportunities and threats.

Question 7

What is “big data” and the 4 V’s of big data?

Answer 7

Big data:‘Is a popular term used to describe the exponential growth and availability of data, both structured (e.g. Accounting software) and unstructured (e.g. Images not in a database).

4 Vs of big data

1. Volume of data generated
2. Variety (or variability) diversity of source data, with a lot of the data being unstructured (ie not in a database)
3. Velocity the speed at which ‘real-time’ data is being streamed and processed.
4. Veracity the truthfulness of captured data

Question 8

What opportunities can Big Data create for businesses?

Answer 8

• Predictive modelling: - Identify new trends and patterns, allows a deeper understanding of customer requirements, can facilitate new products or new market development.
• Cluster analysis: Segmenting customers can help create targeted strategies.
• Social Analytics: Non-financial data can be calculated on a mass
• Engagement measures: Understand the level of interaction among platform members, who’s the most influential users.
• Reach Measures: How far company promotions and marketing campaigns reach people via social media.
• Real-time Reporting: allows Orgs to Respond faster to changing external conditions.
• Accurate and detailed performance data reports in real-time, allowing better insight on performance and the reasons for variances in performance

Question 9

What are the risks and threats big data pose for organisations?

Answer 9

• Does not guarantee analysis identifies trends. Focus on data on correlations of data and less on causation.
• The Cost vs benefits big data analysis approach needs to be fully considered. Others wise large investments into data analytics may not benefit the Org.
• Is data truthful and objective, has data become the victim of hidden biases?
• Viruses or System Errors can corrupt data.
• Hackers are an increasing threat. May sell data to competition, ransoms to regain access, fraud.
• Could lead to Legal action if companies have not taken the necessary steps to secure data or follow legislation on disclosures on hacks

Question 10

Briefly Explain 3 ways how data can be used for Decision Making?

Answer 10

• New Product Development
• Marketing Decisions
• Pricing Decisions

Question 11

What type of questions can data answer, to help managers develop new products?

Answer 11

• Potential costs of launching new products?
• Potential benefits of launching new products?
• Will new product development help the organisation achieve its objectives?
• Can the organisation develop existing products or is a totally new product required?
• Does the organisation have the required skills and competences needed?
• Should the organisation launch the product?

Question 12

What type of questions can data answer, to help managers with Marketing Decisions?

Answer 12

• How should products/services be promoted?
• Through which channels should the product/service be delivered?
• Identify (CSF’S) the product/service need to have to meet customer needs?
• How important will staff be in developing/delivering the product/service to customers?
• Do processes need to be updated to produce/sell the product/service?
• How might competitors respond to new products/services?
• What might the impact of the competitor response be?
• Which customers are the most important/profitable for us?
• Why are some groups of customers more profitable than others?

Question 13

What type of questions can data answer, to help managers with Pricing Decisions?

Answer 13

• How is customer demand for a product/service likely to vary at different prices?
• How will pricing affect profits and cash flows?
• How does the proposed price fit with the companies overall generic strategy?
• How does it compare to competitors’ prices?
• How do competitors’ costs compare with ours?
• Are competitors vulnerable because of their cost structure or their product/service portfolio (or are we vulnerable because of our cost structure or our product/service portfolio)?

Question 14

What types and sources of data can managers review to make decisions?

Answer 14

Field research (primary research) involves getting information directly from The consumer on their opinions and requirements. Primary research methods include asking customers

• Consumer questionnaires
• getting feedback from focus groups
• undertaking customer interviews

Market research was taken from desk research (secondary research). Sources might include:

• reviewing competitor annual reports
• production records
• records from the finance department
• talking to the R&D team
• customer complaints
• customer loyalty schemes and past purchase history

Although significant traditional market research is still undertaken, organisations are now increasingly capturing social media channels and through the technologies which make up the ‘internet of things’.

Question 15

Define Information systems and why is it important from a strategic perspective?

Answer 15

An information system: Consists of the systems, processes and procedures involved in collecting, storing, processing and distributing information.

The information systems (IS) strategy: Is the long-term plan for systems to exploit information in order to support organisational strategies or create new strategic options.

Why?

Ultimately to be effective Managers need reliable and relevant performance information.

So managers need to control the information system, which provides provide the appropriate type and amount of information.

It is important to recognise that I.S is made up of more than just the technological aspects (i.e computers, databases etc); it is concerned with how information flows.

information strategy needs to be aligned to the overarching organisational strategy.

Question 16

Why is it important to have information systems controls?

Answer 16

• Information is a source of Competitive advantage
• Information is critical to the success of the business
• Quality of how information flows impacts on customer service.
• Information needs may require structural changes
• Information affects businesses at all levels and external stakeholders
• Information systems involve high costs when it is used

Question 17

Why are I.T and system security controls used?

and

Briefly explain the types of controls?

Answer 17

an organisation needs its IT assets and systems to operate effectively, it is critical that adequate control measures are in place to help prevent theft, fraud, and human error.

Types of Controls

Controls Over Physical Access to the I.T and I.S

Prevent damage to infrastructure from natural hazards, eg fire or Unauthorised access

• Simple Controls – Locked Doors, CCTV Intruder alarms and security guards
• Advanced Controls – Biometric machines, Fingerprint readers, retina scanners.

Logical Access Controls

Logical access controls are aimed at ensuring that only authorised users of IT systems are provided with access to those systems. e.g Passwords, tracking and limiting the number of incorrect passwords, two-factor verification.

Operational controls

Operational controls are aimed at ensuring day-to-day activities run effectively. aimed at influencing an individual’s behaviour.

• Segregation of duties
• Audit trail of who has accessed information and what operations did they perform.

Controls over data input

• IData Verification
• Data Validation, ensure data input is complete and not duplicated
• Format check
• Limit check
• Range Check
• Control Totals

Question 18

Why do managers need to think about Cybersecurity more than ever?

Answer 18

Cybersecurity: Is concerned with the protection of systems, networks and data in cyberspace.

Cyberspace: Is the term used to describe the environment in which communication over IT networks takes place.

The frequency of ‘cyber-attacks’ is continuing to rise and highlighted the need for improved cybersecurity. The increased emphasis on cybersecurity requires organisations to change their approach to protecting data, from external threats e.g.

• Threats from hackers all over the globe and often involve criminal groups, corporate espionage, Hacktivists and Rouge Government.
• The growing number of ways and access points in which hackers can gain access to data.
• Security failures can have far wider implications and may include reputation damage, loss of intellectual property and disruption to operations.
• Non-compliance of legal regulations can lead to fines and sanctions.

Question 19

How can organisations promote cybersecurity?

Answer 19

• Making cybersecurity issues easier to understand for everyone to follow.
• Employing a Chief Information Security Officer to help communicate the threats.
• Reorganise roles and responsibilities to ensure that there is accountability for cybersecurity within the organisation
• Determining accountability for cyber risks at the strategic apex. A member of the board assigned responsibility for heading up cybersecurity. Having a member of the board in this role should help promote a cybersecurity conscious culture.
• Learning from past security breaches. Following a security breach, as an opportunity to promote the importance of cybersecurity should put in place measures to address the weaknesses that permitted security breach
• Determining the organisation’s tolerance to cyber risks is an important step in designing management strategies and identifying the need for increased resources.
• NEDs play an active role in promoting Cybersecurity, challenge directors the need for following best practice in cybersecurity.

Question 20

Briefly explain practical measures an organisation can improve I.T/I.S and date security.

Answer 20

• Continuity planning. This may consist of a plan which details the contact details for crisis management staff, customers, suppliers, the location of offsite data back-up storage media.
• Systems development and maintenance. regular updating of software and hardware, and to ensure that the controls remain fit for purpose.
• Personnel security measures. Organisations need suitable processes for ensuring that only trustworthy employees are recruited. All employees should receive adequate and regular training.
• Asset classification and control. Assigning an ‘owner’ to manage certain pieces of information. Making individuals accountable for ensuring that key information is up-to-date and protected.
• Compliance measures. Organisations need to ensure that policies relating to the use of IS and data are enforced. Policies should also conform to the law where appropriate ie data protection.

It is important to note that the measures provided above are not exhaustive and any improvements needed to enhance existing IT/IS controls will be driven by the situation facing the organisation.