Showing posts with label Technology. Show all posts
Showing posts with label Technology. Show all posts

Management of Change: Change- A case of UNDP Pakistan


Teaching Notes

Q1. Describe what are the key drivers of the change? What were the factors drove UNDP to launch change process?

The business development is about change. The challenge for the organization is how to stay ahead in an ever-changing environment. External and Internal divers necessitate organizational change. Managing change refers to making changes in a planned and managed or systematic fashion, in case of internal drivers of change. Responding to a change impose by external factors, It is about the response to changes over which an organization exercises little or no control (Spicer at al 2006).

External Drivers of Change:
• Technology
• Market places
• Customers
• Competitors
• Government and Politics
• The economy
• Globalisation

Internal Drivers of Change:
• Management Philosophy
• Organisational Structures
• Organisational Culture
• Systems of Power and Control

In UNDP organizational structure, diverse power was centre in headquarters and country offices which became points of resistance for programme level staff, hence there was a need to change the structure and make UNDP more flatter organization (See Exhibit 8). In new environment there was also need to create entrepreneurial spirit in the organization through the establishment of a demand-driven and client-focused culture and a ‘Learning Organization’, one capable of continuous adaptation to the changing external environment.

The impetus for change process in case of UNDP came from the shift from multilateral to bilateral assistance, the onset of globalization, the mushrooming of crises around the world and the overall decline in Official Development Assistance (ODA), which signalled the end of providing assistance on the basis of entitlement.

Q2. Describe what are different types of change management model available? In current case which model been most widely used?
The change models operate different approaches and processes in different environments. They inherent difficulty in uncovering the informal systems that guide peoples’ behaviour and using a mix of insider knowledge and experience, with objective outsider expertise and facilitation is essential for success. Thus, the key challenge for organisations is to match the model to the context.
Wignaraja (2006) describes change process into three main typologies:
· Top-down change management is based on the assumption that if managers plan things properly, change can be executed smoothly. The only obstacle comes from resistance of some employees, hence focus is on changing the culture of an organisation or the ‘way we do things around here’.

· Transformational change management relies on transformational leaders setting a personal example and challenging people to think ‘outside the box’ and innovate, while providing a safe environment for doing so.

· Strategic change management is based on a certain recipe and are in contrast with the top-down models in that they aim to introduce a new behaviours at work, allowing people to witness the benefit for the organisation and, thus, based on the evidence, internalise the change in their ‘ways of working’.

UNDP change process, can widely categorize as a top-down change management approach. It can be effective as other and depends on the situation. Although it is generally accepted that this approach often fails the most. All approaches highlight the importance of leadership, communications and involving people in the change process.
Q3. Assess the change process and its implementation. Does this follow best practice?
The successful organizational change comes through a total and continuous commitment with adequate resources to sustain the effort. According to Susan M. (2006) best practice and appropriate change management strategies and methods for development organization like UNDP will require:

· A highly flexible approach to result-based planning, budgeting and management that can capture process results and costing, as demanded by change management.
· Training for development agency personnel in process facilitation, negotiation and other specific change management methods and skills;
· Capacity development in this field requires experts, local and international, who have not only technical expertise but also coaching, management development and mentoring skills, to facilitate rather than direct.

The introduction of increased use of appropriate change management strategies and methods in development cooperation will often be resisted due the difficulty of precise definition of their results and the uncertainty of their outcomes.

Change efforts are significantly normative in nature. Positive change is driven by coalitions of aligning interests, soft systems like motivation, ethics and pride and fundamental transformational issues starting with individual transformation in attitudes, values and behaviour. The sense of urgency that would normally fuel a change strategy was not widely appreciated. The diverse power centres in headquarters became points of resistance, hence the commitment of corporate leadership necessary to bring about sustainable organizational change was a missing element.

Prescribed change is likely to be resisted the most. It is therefore important to evolve language and methodology for change that is consistent with norms and values more generally but also with the culture of the organization. It was observed that programme staff were not been given basic information about what is expected of them, nor are they being involved in the change process. The expectations that staff will apply initiative and creativity to achieving organisational goals are unrealistic in this context.

Q4. What were the key features of the change process employed?
A four stage change management process was used, with two broad processes (UNDP change 2001): a) managing the environment of change; and, b) executing the change itself.

Managing the environment of change subsumes two main areas:
A. Creating the momentum for change including making the case, visioning, empowerment and voicing activities
B. Analysis of the change context including diagnosing issues of who wins, who loses, social, cultural, legal and policy issues; data collection and analysis; and operations research on problems.
Executing the change process: here an enabling role is foreseen again in two areas:
C. Facilitation of change including building change coalitions and harnessing champions, process consultation, decision-making methods, consensus building, and brainstorming, all informed by factual information and analysis.
D. Communications about change, including public meetings, various other forms of two-way communications, and information dissemination.

Exhibit 5 shows the framework for change management process. A map of steps, guiding the process step-by-step was defined, with internal primary roles and facilitators were identified.

Q5. What were the issues with the change can you identify?
Change management exercises are highly unpredictable in terms of what they achieve. Experts agree that most change projects fail. Pascale (1999) suggests this is the case for 80% of change programmes. Management experts' opinions converge on several causes that can derail change efforts. UNDP change process management at ADP AJK level rasied many issues.
The participatory approach adopted in launching change process by country office was early success, which lost focus later on staff requirement working in different socio cultural background.
There was insufficient understanding of the constraints embedded in bureaucratic systems, organizational culture and the structure of human interactions which became stumbling block to change management processes later.
Putting in place clear and consistent messages regarding the change process, regular and open stakeholder consultations, airing of grievances, and putting in place feedback and learning mechanisms to enable adaptation during the course of the change process were emphasized in manual but practically no one was caring those.

Q6. What lessons are there to be learned from the experience?
Developing leadership skills, clarifying roles and getting stakeholders on board are all necessary for successful change interventions. However, paying attention to soft aspects of organisation, such as culture, is also indeed as these factors are often paramount determinants of the real direction and pace of change.

The early identification, and addressing of, the sources of resistance to change (in other words, facing up to the reality that change produces winners and losers), is a must-do action. Doing so also involves addressing the values, norms and cultural aspects of stakeholders that are relevant to the change effort, both inside and outside the organization.
It was learnt that the change should begin with an assessment of the change landscape and the organisation’s position in it. Assessments should consider, inter alia, the organisation’s current capacity, performance, leadership, systems, services and stakeholders and the interplay of these in the wider institutional context. The process of managing change must include frequent and innovative attempts at building consensus, demonstrating benefits, dialoguing and communicating.

Q7. Why communication is vital for implementing a change? Specially its importance in project-based organization like UNDP?

How changes gets communicated and talked about is crucial to success. Change must be communicated at all stages. In the conception stage, communications for inclusion ensure that stakeholders buy in and are less likely to become potential resisters of the change process. Communication also helps to dispel uncertainties and mitigate the potential threat it poses to those that see themselves as likely to be impacted by the change (Palmer at al 2006).
This also implies that all stakeholders must be afforded the opportunity to input into the design of change – or at least, as much as is practically feasible. Once change processes have been undertaken, a process of sharing, communicating around its outcome and implications with all stakeholder groups is important.

In case of UNDP, which involved in thousand of projects around the world and operates business in diverse environment, intergovernmental dependencies, multiple ownership of core processes with other donors and within UN system. In many UNDP programme counties, the boundaries of pushing change and reform are set by what is acceptable at the political level.

Secondly, UNDP programmes are based on temporary teams and they are geographically dispersed. It is hard to provide systems and structure for a project in Somalia similar to one in Bangladesh. Any change process success in project based organization is very dependent on communication. Communicating change is about building consensus and coalitions for change, and then enabling the change through process facilitation, negotiation, conflict management, analytical skills, advisory skills and specific change management methods, is clearly a critical input.


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Strategic Technology & Innovation Management: Identifying Core Competence of a Company

1. Executive Summary

The core competence perspective suggests that a large part of the explanation for organizational success can be found in the concept of core competence, namely that firms which pursue a strategy of building on specific competencies may develop unique, inimitable skills which will provide the foundation for competitive advantage.

The goals of this assignment are to: (a) identify core competence of an company breezeplus solicitors, using core competence framework (Hafeez at al., 2002), (b) analyse the capabilities which need to nurture and further develop and (c) chose strategic alliance model to explore future business directions based on the strength of competencies.

Breeseplus provides handling high volume of instructions for lending institutions, FTSE quoted companies, housing associations and estate agents. Conveyancing industry is operating in intense competition and business must need to focus on developing core competencies and then creatively applying them to an ever-changing market, to remain competitive.

A survey of breezeplus Managers was used accomplished these goals. It was based on structured framework used for identifying core competence, consists of three stages;
Stage 1: identification of key capabilities
Stage 2: determination of competence
Stage 3: determination of core competence

The study identified IT & Communication as a core competence alongwith client care and office management. It further found that IT & Communication capability is a collective and unique in its characteristics, as well as strategically flexible, had contributed in the past and will contribute to the success of potential business expansion in future.

2. Company Introduction
breezeplus was created by Breeze and Wyles Solicitors, a regional law firm with 5 office throughout in Hertfordshire and Middlesex with 11 partners and a total of around 150 lawyers and support staff. In 2003, breezeplus was launched to provide innovative solutions for lending institutions, FTSE quoted companies, housing associations and estate agents.

breezeplus now operates from its £1.5 million headquarters in Bishop’s Stortford. It has quadrupled in size in terms of staff numbers and have handled in excess of £10bn worth of conveyancing and remortgage transactions.

2.1 Services
breezeplus handles high volumes of instructions from lender, agents and builders. Repeat bulk re-mortgages and repossession work is centred on our Bishop’s Stortford office. Each of the offices of the firm has a team dedicated to Residential Conveyancing matters.

Equipped with leading edge information technology, breezeplus supply these services through a structured use of dedicated leading edge case management software. Highly trained staff works to pre-set service standards, deliver customers with an efficient, seamless, high quality services. Some of our services offered are;
Volume Conveyancing
Volume Remortgaging
Mortgage Repossessions
Direct to Client Conveyancing
Housing Associations
Further Advances

2.2 Company Structure
The Company remains a private partnership, and business is run on a daily basis by the three Heads (Partners) and Practice Manger. Figure shows functional and reporting structure at breezeplus.

3. Why Core Competence?

Core competence is a capability of a company does especially well relative to its competitors. Capability is the ability to make use of resources to perform some task or activity (Hafeez at al., 2002).

Capabilities are well-organized special skills, technologies, processes, knowledge, expertise, or abilities. They create customer value and are not equally accessible to all competitors. Thus, a unique capability should have three attributes (Barney 1991 and Hamel 1990).
1. Rare in marketplace
2. Less imitable by competitors
3. Difficult to be substituted

Core Competencies must be flexible and have potential for continuous upgrading and development. Sanchez (1996) suggest that firms with superior dynamics efficiencies in reconfiguring and redeploying resources may compete by taking advantages of changing technology and market opportunities.

4. Methods

4.1 Survey Design
This study utilizes a survey research method based on core competence framework (Hafeez et al., 2002) questionnaire. It is preferred for rapid data collection and the ability to identify attributes of the population from a small group of individuals.

The survey constructs of respondent general information and 5 questions about company capabilities and performance (covering letter and Questionnaire is included in Appendix A). Respondents were asked about; department, job title, number of employee in department, length of tenure with the firm. Further, they were asked to identify and mark capabilities with these sub categories.

1. Identify breezeplus 5 main capabilities
2. Uniqueness Assessment of Capabilities
3. Collectiveness Assessment for Capabilities
4. Strategic Flexibility Assessment for Capabilities
5. Identify top two Capabilities

5. Results

The date was gathered from 8 Head of departments and Managers. The length of tenure, serving with the firm, of these managers varies from 3 to 37 years. The minimum employee working under one manager was 3 and maximum was 20. Other question response results are as follows:

5.1 Identify breezeplus 5 main capabilities
9 key capabilities were identified by respondents and are listed in Table 5.1.

Table 5-1 : Key Capabilities Identified
S. No Key Capabilities
1 I.T & Communication
2 Client Care \ Customer Services
3 Office \ General Management
4 Employee Training & Development
5 Business Promotion
6 Pricing
7 Human Resource Management
8 Performance Management
9 Service Development

All respondents identified IT & Telecommunication as one of main capability, followed by client care 87%, office management as 62% and employee training by 50% of responses.

5.2 Uniqueness Assessment of Capabilities
The second was question asked to assign score (1-4) to each of capability identified in term of rareness, inimitability and Non-substitutability. Respondents’ results showed IT, client care and office management on the top, are shown in figure 4-2.

5.3 Collectiveness Assessment for Capabilities
Stage 2 involves assessing collectiveness, management was ask to indicate the degree to which each capability has the attributes of (a) across-function (b) across-products and (c) across-business.

Stage 3 of the questionnaire asked respondents to scale each capability from 1 to 4 in term of resource re-deployment and routines re-organisation to find out strategic flexibility. The response showed IT & Communication and client care highly flexible.

5.5 IT & Communication at the Core
Breezeplus operating in volume conveyancing industry, where speed and efficiency is key to success. This study identified IT & Communication as a core competence alongwith client care and office management. Effective use of IT & Communication capability, which is collective and unique in its characteristics, as well as strategically flexible, had contributed in the past and will contribute to the success of potential business in future.

6. Analyses of Core Competence

Breezeplus is committed to its business strategy by further investment in its core competencies including developments in the I.T system, case management system, document processing solutions and online case tracking systems to retain its industry lead. The integrated systems provide customers with an efficient, seamless, high quality service.

6.1 Network
The firm has a modern wide area network connecting all five offices. All staff have access to e-mail, Internet and connected to distributed case management system. Intranet is in place to provide an internal reference and support forum for staff. In-house training is provided in how use and access the IT resources of the firm to new staff.
Figure 6-1: Network-Intranet

6.2 Case Management System
Figure 6-2: Case Management systemPartner for Windows Case Manager is used in breezeplus. It is a powerful document, data and file management system, based upon a strong relational database and linked to a centralised electronic diary, the system is the single source for all case and document information, client details, diary dates, appointments and task reminders at both client and matter level.

6.3 Document Processing Solution
Figure 6-3: document processing solutionBreeplus use InputAccel, a document processing solution, provides all the necessary tools for quickly and easily transforming paper documents into streamlined digital content for enterprise applications and databases. It reduce operating costs, improve data quality and accelerate business processes.

7. Strategic Alliance Model

HIERARCHY
mergers & acquisitions
joint ownerships
joint ventures
formal cooperative ventures
informal cooperative ventures
MARKET

Strategic Alliance takes the form of an agreement between two firms to develop and supply technology or product. Lorange and Roos (1998) model provides a define classification of strategic alliance on a continuous scale between, one hand, transactions on a free market and on the other, total internalisation (Hierarchy).

ModelAn alternative definition of strategic alliance is based on the degree of interdependence between the parties involved (Contractor and Lorage, 1988).

Low interdependence
Informal cooperative venture
Formal cooperative measure
Joint venture
Joint ownership
Mergers and acquisitions
High interdependence

In case of breezeplus, small privately own business, which have small strategic alliances with technology companies, in-depth and thorough analysis is required to explore future expansion. The questions concerning market potential, key competitors, worst-case scenarios, and competitive advantages of the alliance need to be address.

8. Conclusion

In the last 4 years, breezeplus through careful planned growth has formed specialist departments, each of which has been developed to improve the quality of the services offered to individual and business clients. The business invested more than £2m to its proposition including the purchase of the Volume Business Suite, state-of-art IT infrastructure and professional staff.
IT as core competence for breezeplus is incredibly complex and too broad, and requires too many specialties, for its ever-changing environments. Users, suppliers and customers want instant access to information. The demand for new applications, functionality and new technology is incessant.

To survive competitive environment in the industry, breezeplus has to further identify IT to play its strengths. The advantage achieved by the early adopters of technology begins to be eroded as the later adopters catch up. It must coldly assess what it does best and concentrate on core competencies.

Playing to its core competencies, breezeplus requires an understanding on IT's part of: the needs of the company, the current capabilities of its organization, the desires of its clients and the alternatives available on the market.

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Operations Management: Technology for information processing and customer relationship management

1. Executive Summary

What we don’t often hear is how business owners are using technology as a competitive advantage to propel them ahead of their competitors. Why is that?

With all that’s being written and spoken in the media today about technology, why are these business owners so unaware?

The report will try to answer these question and examine the use of process technology in businesses. It will evaluate how businesses used technology for Information Processing it as a competitive advantage. It will ascertains use of Customer Processing Technology in Customer Relationship Management (CRM) and its importance in the more informed customer environment.

The report identifies current strategic opportunities that firms should be thinking about if they are not doing so already. It discusses the benefits and challenges of getting into these areas with new technologies, new partners and new business processes.

The report covers the some of the issues like;
ú Increased or improved use of ICT helped to expand business activities?
ú Increased or improved use of ICT resulted in the development of new services and/or products?
ú Internet usage has helped to create new networks – inside and outside the company?
ú The adoption of ICT solutions has lead to the restructuring of working and communication methods in the enterprise?
ú The business now understands better the need for staff training?
ú How Customer relationships become a strategic asset among corporations?


2. Introduction and Objective

The future is not some destination; it’s our own creation. The paths to it are not discovered, they are forged, and the process changes both the path maker and the destination.
Peter Fingar

Most business owners still see computer technology as an efficiency tool rather than an investment in the future success of their businesses, and that’s a critical mistake. You can’t afford to think like a traditional business owner any longer. Continuous advancements in computer technology have opened up new customer and geographical markets for many small businesses. But in creating a more accessible and integrated global economy, technology has also exposed a business’s current customer base to competitors located thousands of miles away.

2.1 Information processing technology?
Information processing technology in the past decade has transformed the way that information is produced, managed, manipulated, transferred, and received. Many ICTs have zero or declining marginal costs. There has been increased adoption of all categories of software, from databases, CAD-CAM and presentation packages, to spreadsheets and communications software. There is a perceived lack of expertise in the planning process as well as the technology itself.

2.2 Customer processing technology?
Customer processing technology or Customer Relationship Management (CRM) is currently one of the most important technologies available to any company. It enables a business to improve its understanding of its customers. It has proliferated with use of the Internet, as electronic communication is integral to an effective CRM strategy. CRM is a tool with which an organization can collate the information it has regarding its customers. It is both an ideology and a technology.


3. Technology for Businesses Development

The growing complexity of science, technology, and organization does not imply either a growing knowledge or a growing need for knowledge in the general population. On the contrary, the increasingly complex processes tend to lead to increasingly simple and easily understood products. The genius of mass production is precisely in its making more products more accessible, both economically and intellectually to more people.
Kuhn, Thomas. 1962

Key findings:
Information and Communication Technology (ICT) Activity of UK businesses, 2004
The value of Internet sales rose by 81 per cent between 2003 and 2004, from £39.3bn to £71.1bn, while the proportion of businesses selling on-line rose by 24 per cent from 5.4 per cent of businesses to 6.7 per cent of businesses.

Sales over other ICTs, for example, via non-Internet Electronic Data Interchange (EDI),
automated telephone systems and e-mail, fell slightly from £200.6bn in 2003 to £198.1bn in
2004. Sales over ICTs other than the Internet were still nearly three times the value of sales over the Internet.

Internet sales represented just under 3.4 per cent of the total sales of non-financial sector businesses in 2004, compared with just under 2 per cent in 2003 and marginally over 1 per cent in 2002.

Internet purchases represented nearly 4.4 per cent of the total purchases of non-financial businesses compared with just under 2.8 per cent in 2003 and just over 1.3 per cent in 2002.

Just over 42 per cent of businesses reported using broadband for their Internet connection, a rise of 65 per cent on 2003. Nearly 34 per cent of businesses had a website in 2004, up by 10 per cent.

The number of businesses using the Internet to interact with public authorities rose from 19.4 per cent to 20.9 per cent between 2003 and 2004.

Source: Office for National Statistics, 2006

Globalisation provides both opportunities and challenges. Expanding markets and access to knowledge and technology produced throughout the world provides an opportunity for substantial increases in standards of living. But competition from abroad can provide significant challenges. The competition from abroad has become particularly keen in recent years, as those in developing countries have learned how to produce and market the kinds of goods that are demanded in the advanced industrial countries. Unless countries respond to that competition, jobs will be lost and living standards reduced.

Education and technology are the keys to a successful response to the challenges of globalisation. The only way to compete against the low wages in the developing countries is to improve skills and productive efficiency, and to respond more quickly and effectively to what consumers want.

The most successful of the advanced industrial countries have done just that; they have relied on improvements in technology and education to respond to the challenges posed by globalisation. Larger fractions of the population have gone on to college. There have been more investments in research and development. They have also shown flexibility in restructuring the economy. Part of that restructuring has entailed a strengthening of the service sector and a growing importance of small and medium size enterprises.

3.1 Competition Trade liberalisation and a rapid fall in communication and transport costs mean that the UK has increasingly to compete against countries with significantly lower labour costs and reasonably well- educated labour forces. At the same time, technology and scientific understanding are changing our world faster than ever before. These new developments and innovations are producing many opportunities for entrepreneurial businesses to gain a competitive advantage, as even a cursory glance through Process Engineering demonstrates.

3.2 Competitive Advantage
When business owners asked, what their competitive advantage is, they usually respond with at least one of the following advantages:
· Niche market
· Customer relationships
· Unique product
Why not technology?

3.3 What technology can do for you
As a competitive advantage in a growing entrepreneurial business, technology can be used to
· Compete with huge companies by marketing on a nearly level playing field – the internet
· Build ongoing, loyal relationships with customers
· Link with strategic partners to speed up processes like product development and manufacturing
· Link everyone in the company with everyone else, as well as with necessary sources of information within and outside the company
· Provide real-time information on pricing, products and so on to vendors, customers and manufacturers.

3.4 Why Information processing technology
Information processing technology lead to new industries and innovative approaches to business and eliminate process cost. Throughout the world ICT is changing the nature of information dissemination, communication patterns, business practices and economic development. Industry in the UK lives or dies by its innovation and technology. This is true of every sector, and perhaps particularly true for process engineering. For years, the UK has enjoyed pole position in the all sectors.

3.5 Why Customer processing technology
The increased importance of strategically leveraging the customer relationship management (CRM), which has been growing since the mid-1990s. Many industries were experiencing increased demand from their customers for higher quality and easier access to service. Corporations and top managers started to rethink their traditional ways of providing service. Customer relationships started to become a strategic asset among corporations.

4. Use of Information processing technology
“Over the last 20 years use of technology for information process has increasingly been identified as a major contributor to the process of business development and improvement and it has been identified that ICT is responsible for around half of productivity growth in modern economies. It drives improved efficiency and better services and products across the entirety of the private and the public sectors.” (Debra, 1997).

The Information technology industry encompasses telecommunications, hardware (computers), software (computer applications and programs), and services. ICTs are pervasive, cross-cutting efficient, and global. They foster the creation of networks and sharing of information (Slack, 2004).

Business Development is the process of improvement that enables a business to become more efficient, profitable, and thereby creating or safeguarding jobs. Business development therefore does not only concern marketing and sales departments, but all parts of a business which constitute its value chain and requires effective communication and co-operation within a company.

The use of ICT and technology has affected every aspect of business, transforming not only the way that business is conducted but also creating new business sectors and jobs. The creation of companies like Google and e-Bay which did not exist 10 years ago, was only made possible by advances in technology and the changes that this has created in the way that people behave (currently Google is valued at £44billion – Source BBC 5th June 05). Some examples of the nature of this change include:

4.1 Marketing
The use of websites has allowed companies to develop new and cheaper ways of reaching new markets, offering customers the opportunity of buying goods and services whenever they want and often at reduced cost, whilst also enhancing the level of customer service. This has been coupled with the expansion and use of e-mails which again has been used by business to market their goods and services directly to potential customers, as well as communicating with existing customers and suppliers.

4.2 Finance
Practically all companies now use software programs e.g. Sage or Excel to manage their accounts. This has allowed them to look at financial information when required, monitor and respond to their customers purchasing patterns by e.g. offering discounts and overall improve the management of their finances. The result of this has been for many companies a reduction in their accountancy fees.

4.3 Out of office working
For many businesses the need for staff to be away from the office attending meetings etc. or to be based in another geographical location has grown alongside employee demands for more flexible working patterns. However effective communication and ability to access information etc. remains critical to the productivity of these staff members. Therefore through the use of technology many companies now use a range of technologies to enable this. These include mobile phones, e-mail, broadband, laptops, etc. Thus ensuring that companies are able to be flexible and adaptive depending on their business needs.

4.4 Networks
Virtually all businesses now have or have access to a computer. The existence of two or more computers in an office almost always leads to the creation of a network. The main advantage of doing so is that resources can be shared e.g. printers, internet access, files/information can be managed and shared amongst workstations and the security of information can be better managed through a network. Increasingly networks are not just confined to the office but are being adopted so that they allow home/remote working that supports changing business needs.

4.5 Businesses and Internet
It has become a cliché to say that technology is moving very quickly. However, with the proliferation of new applications on the Internet, it is a difficult assumption to avoid.

The Internet has become a feature of many peoples’ lives. It is already difficult to define the average “Internet experience”: for some it has become a necessity at work, for others an occasional leisure activity, others an essential communication device. So far, it is in the business world that the Internet has had the greatest penetration and impact.

The business community is quickly finding applications for these new technologies, as they become available. Each new technology that is developed has significant implications for one industry or another, but the establishment of the world-wide web has changed the laws by which all companies must operate.

The Internet provides businesses with a global audience. This means that, presuming a business can fulfil the order or requirement of the customer, it has audience that is infinitely bigger than before. However, the company must compete for that audience with competitors from anywhere in the world. From the perspective of a consumer this competition means that he will be able to be sated quicker and cheaper than ever before. The comparability of vendors will mean that product offering will become more transparent and hence pricing will become more transparent.

5. Use of Customer processing technology

Customer relationships have been moved to the top of the corporate priority list :
Technology provides customers and employees faster and more useful information surfaced. Once a CRM strategy and technology for customer service was in place, it became vital to develop processes for measuring and monitoring performance. Metrics created to measure customer retention; acquisition and market share have been implemented and used as a key management tool (Emerald Insight, 2006).

Going forth with understanding the customer by segment and implementing CRM processes and applying software tools. Continually monitoring of customer satisfaction and behavior and measuring successes with benchmarking and more will make sure the processes continue to evolve in the best method.

Why some organizations have almost completely ignored the need to adopt new technologies or they are being too slow to decide and start the respective adoption processes. Many medium sized enterprises seem to be reluctant to adoption due to some factors, namely, owners’ mentality, lack of technical qualification, resistance to change, and fear of being possible to face new technologies as a source of organizations’ insecurity. To protect organizations, a good level of knowledge on risk controls, incident response, and disaster recovery should support the implementation of a security policy and its consequent program.

Companies across a wide spectrum of industries have to contemplate and position themselves with respect to the following four strategic opportunities. R&D outsourcing may seem attractive from a cost perspective but appropriate safeguards have to be negotiated so that a company’s intellectual property does not get appropriated. Digital convergence requires firms to think creatively about complementary products and services without straying too far from their core competencies. Identifying customer needs and emerging markets needs new tools and techniques to be embraced for gathering market intelligence. Finally new technologies and business models should stimulate companies to develop policies on digital rights management after balancing stakeholder interests and assessing the threat of disruptive innovations.

5.1 Bring business closer to customers
As companies have grown in these times of international business, so they have grown further apart from their customers. Where once a business could be counted upon to know both its customers and their demands, the scale of today’s companies has made this significantly more difficult. However, the reason so many organizations barely know their customers is not due to lack of contact or interest but rather the lack of a system to collate and analyze the information.

5.2 Reduce the costs of custom
The cost of both attracting new custom and retaining customer drops as a business implements a CRM strategy. Adopting a CRM strategy is not, however, an easy task, some of which require the business to re-examine the methods by which it does business.

The “Integration of customer data across the company”, for example, requires a sophisticated IT strategy combined with the determination to bring together all customer facing departments of an organization.

However, although each of these stages carries a significant cost, they also confer a benefit to the client and hence an advantage to the business which can outweigh any cost.

5.3 Assess the profitability of customers
Beyond reducing the cost of custom, CRM can also be an invaluable tool to recognize the value of custom. The traditional rule of business is that custom equals profit and thus is good for business. But this is not strictly true.

Customers can be segmented by profitability. Each customer is distinct, with individual tastes and habits, which determines their profitability. By determining which customers are the most profitable, a business can significantly increase its total profitability.

5.4 How can CRM aid my business?
There are several key elements or goals of CRM. An effective CRM strategy involves offering improved levels of customer service, which differentiate you from your competitors, and add value through better knowledge, and use, of customer relationships. These benefits would be achieved through increased sales and marketing efficiency, coupled with efficient delivery of information from customer facing staff to management. The customer will benefit through improved levels of service.

In simple terms, CRM facilitates the identification and retention of the most profitable customers and then ensures that they are handled appropriately. But what does that mean in the fleet industry? It means setting prices at a level that will ensure that each contract will remain profitable throughout its duration.

Successful CRM strategies must be underpinned by advanced IT solutions. The key challenge that CRM systems must respond to is the need to consolidate data stored in product-focused systems into a single customer view and make “added value” customer data accessible to both decision makers and customer-facing staff.

The interaction between business processes and the underlying IT infrastructure as part of a CRM-driven IT strategy is vital. The CRM components transform back office product-based information into customer-based information which can then be leveraged at the point of interaction. Additionally, the data warehouse assists in providing sales and marketing information, as well as management information for product development and profitability analysis functions.

5.5 CRM and IT systems
The principal IT requirement imposed by CRM-driven IT strategy is the integration of disparate systems to optimize the flow of customer intelligence throughout the enterprise. This involves leveraging product-focused legacy systems, while at the same time requiring closer integration of all IT systems associated with customer handling. The complexity of product-focused legacy systems, which typically only interface with distribution channel technology while offline, presents significant obstacles to achieving these goals.

6. Lesson Learnt

This transformation has really taken place over the last 20 years and continues to transform the way business is done. No business today can ignore the use of technology as its effective use helps businesses to remain competitive and profitable, thereby creating or safeguarding jobs.

New technology can seem a threat to few business owner-managers and there is a link between business growth and the use of IT. Few hurdles recognised are; IT may be associated with growth, and some may resist growth. A strong need for impartial advice, independent from computer vendors, most business did not consider maintenance and training costs when purchasing technology. Organisational factors such as staff skill levels, familiarisation time, and the impact on jobs, were rarely considered prior to purchase. More complex IT-related business and organisational changes may require integrated technical and managerial training, so that SMEs can become more strategically oriented and benefit better from IT.

During implementation of new process, often throw’s up many unforeseen issues, especially when you are dealing with technology, which are a result of internal and external factors. This then leads to lesson’s learnt which can range from better ways to manage a resources through to innovative approaches to providing support etc.

The increasing future forecast for online marketplaces, business has become 24-hour operators as electronic transactions become commonplace and vendor and consumer will be able to facilitate their interactions utilizing the new communication channel.
Sources: Emerald Insight (2006)

The future of the business is less clear than ever before. The repercussions of eCommerce are likely to be felt throughout the businesses for the next decade. The shape and scale of the industries at the end of this period cannot be predicted, however the first steps that the businesses needs to take are clear. The adoption of customer relations management, closer interaction with both customers and suppliers, and the adoption of new technology as it becomes available, will be prerequisites of a success.

The winners will be those who display innovation. The scope for creativity will be wide, the formation of alliances, new services for clients, new methods of utilizing the Internet and as well the usual devises to outwit the competition!

The speed with which the business environments are changing, few have moved swiftly whilst others have been slow to recognize the significance that new technology. Those that delay further will quickly find themselves unable to offer services that clients will soon expect as standard, and with little time to catch up.

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