Competitive Forces that Shape IT Strategy in Business

Competitive Forces

The introduction of information technology (IT) systems has changed how companies conduct business, and also how they compete in their respective markets. There are a number of risks and advantages to implementing an IT system, which can be managed with the correct mix of technologies as an integrated platform. The purpose of this paper is to review the competitive forces that shape IT strategy in business.

IT Risk to Competitive Advantage

One of the primary risks to a company’s competitive advantages is systems availability. The computer has become a key tool in the art of conducting business, which means that they must be reliable and provide the resources necessary for a person to meet or exceed the expectation of their role. From an IT perspective, system failure is something that should be proactively monitored across the enterprise so that downtime is as minimal as possible in nearly all potential scenarios. The loss of revenues from being offline can be multiples higher with companies that provide 24/7 services to their clients, where revenues are calculated by the minute.

Another risk to competitive advantage is the disclosure of sensitive or proprietary data that is the source of the company’s advantage. A sales agencies value to a manufacturer, for example, derives from its industry contacts and distribution network. Therefore, their contact databases become their most valuable asset. A risk is espionage, an insider could provide these details to a competitor, or to a manufacturer looking to cause disruption in the market by selling online or via direct sales. Another risk in the disclosure of sensitive data that represents customer’s private information, including contact information and financial transaction data. For example, the healthcare industry has HIPPA regulations which stipulate what data is to be protected, how it is protected, and under what circumstances it can be disseminated. These are regulations put in place to protect the consumer, and stabilize competition between market providers.

A third area where IT represents a risk to a company’s competitive advantage is ineffective IT governance. According to Gartner (2013), “IT governance is defined as the processes that ensure the effective and efficient use of IT in enabling an organization to achieve its goals.” Throughout the past 30 years, companies struggled to define the role of IT as it related to business goals, many still do. IT was seen as a necessary evil, a means to an end, or another tool to automate certain tasks within a company, but not a way to achieve strategic advantage over a competitor or a method to dominate a market. As business goals evolve, formal IT governance will ensure that resource allocations remain dynamic and scalable to meet these changing needs.

A fourth risk area would be slow adoption, in that a company does respond to the challenges presented by direct competitors by updating or upgrading its technological capabilities. Many companies across all industries are slow to adopt new technologies, even if they offer clear advantages over current systems, due to user resistance to change or the excessive costs of redesigning proprietary applications to be compatible with modern systems. By not adopting new technologies, capabilities become limited, workers become unable to respond to customer demands in a timely manner, and systems can become overwhelmed to the point of system failure.

A final risk where IT represents a risk to a company’s competitive advantage is in cyber security. Any deficiency in a network’s security model presents a vulnerability that, if attacked with the correct vector, could represent a complete defacing of a company. The single most important aspect of any cyber security plan should be user education. There are a number of hardware and software solutions available to centralize and manage cyber security across an enterprise which provide comprehensive methods to thwart a direct attack from an outside entity, however they can only do so much. Half of all data breaches occur through phishing attacks, “in which unsuspecting users are tricked into downloading malware or handing over personal and business information” (IT Governance Ltd, 2015). These usually come in the form of a legitimate looking email and once the user initiates the connection, the system becomes infected and performs whatever it was programmed to do via the installed malware. The result of a breach could be catastrophic to an organization because of the importance of the actual data lost, and potentially the legal ramifications in the way of lawsuits from divulging protected data, whether inadvertent or on purpose.

IT Support of Competitive Advantage

A clear competitive advantage provided by IT is systems availability. With mission critical systems, redundancy is designed into the system model in an effort to eliminate the risk of system downtime and create 100% availability. While the expense of such a design can reduce net profits, it becomes a strategic advantage because a company is able to provide 24/7 services to their customers, regardless of geographic location. There are many companies moving their customer facing systems into cloud services to provide just that, availability. From online shopping, to financial institutions, to educational facilities, many companies have to provide a 24/7 model in order to meet customer demand and IT is the only way to ensure continuity and consistency across all communication methods.

IT provides a unique benefit for protecting sensitive and proprietary data in that the data can be encrypted to ensure only authorized users can gain access. Some regulations, such as HIPPA and PCI-DSS, stipulate not only data encryption but also low-level, whole drive encryption, using specific algorithms such as AES256 and a shared key pair. Encrypting data, and data communication channels, ensures that no outside party can view the information contained in these data files.

Proper implementation of IT governance can support a company’s competitive advantage because it ensures that all processes designed provide effective and efficient use of company resources using IT as the common thread. Over the past few years, as the value of IT proves its worth to companies looking to remain relevant in an ever changing consumer model, organizations have come to realize how important it is to bring IT goals in alignment with business goals. As an organization grows to meet market conditions, it becomes essential to align these two areas to ensure stability throughout the process. This provides the foundation necessary to ensure continuity as the company evolves.

A fourth way that IT supports a company’s competitive advantage is by enabling the company to be able to adapt quickly to changing markets. When implemented in an elastic model, such as the facilities provided with cloud solutions, companies can respond instantly to spikes in consumer demand with a few clicks of a mouse. By leveraging this model, companies can improve efficiencies, improve worker output, and lower operating costs, thereby increasing revenues and profits. A number of companies have adopted the agile model of development for their products, where concepts are quickly moved from the drawing board, to prototype, to final concept in a short time frame. Issues are fixed as they are found through use in a production environment. IT is the only way that this can be possible because of how the cloud model of scalability provides these resources in a dynamic way, as demanded.

A final way that IT supports an organization’s competitive advantage is through the implementation of a cohesive user education program and the implementation of an information security management system, which is a comprehensive approach to managing cyber security risks that takes into account not only people, but also processes, and technology. Security should be built into every process that any user takes to manipulate data in an information system. Once the physical perimeter of an infrastructure is also secured, users need to be trained to identify phishing attacks and social engineering tactics so they can become a weapon against these attack vectors rather than the weak link. Part of that training should include what cyber security systems are in place, how they protect users and corporate data, and why it is important for users to know this information.

IT Risk Scenario: System Availability

In the course of the author’s career, there was an instance where a major system outage resulted in the company losing a multi-million opportunity to a competitor. The root cause of the system outage was later found to be a misconfigured operating system update, provided by the software manufacturer as a critical update to patch a well-known vulnerability. This misconfigured system update caused every service hosted on the domain servers to reject every all queries from all systems. Since the update was automatically deployed to all servers in the forest, failover switching was not an option. It took over 6 hours to troubleshoot and eventually rebuild the primary server and supporting services to bring the network back online. In that time frame, a bid deadline expired for a major project and the author’s company was removed from consideration. Since they were one of only two companies that services this specific product group, from different factories, the contract was awarded to the competition. It represented a $20 million opportunity that spanned three years across five large developments. Had they been able to submit their bid, they would have saved the client 8% in costs, and over a month in lead-times.

IT Advantage Scenario: Data Privacy and Protection

Data security has become a major consideration for companies of all sizes, and for certain market segments it is a federal edict. Previous to the introduction if HIPPA regulations, the privacy of people’s health records were being mishandled. Data was stored in proprietary formats which increased administrative costs, and was shared with nearly anyone who had a seemingly legitimate need for it, whether that be for patient treatment or insurance carrier marketing purposes. Once public outcry reached critical mass, the Health Insurance Portability and Accountability (HIPPA) act of 1996 was created. HIPPA protects the confidentiality and security of healthcare information, and helps the healthcare industry control administrative costs (TN Department of Health, n.d.).

Conclusion

The implementation of IT systems comes with many risks and rewards for any entity, whether it be a company or a person. The main purpose of IT is to make a company more effective and efficient across all operational parameters. The proper management of the risks and advantages provided by an integrated IT platform can ensure that a business is able to meet the demand of its customers while being in a position to evolve as rapidly as their market does. Once systems and software are setup, security models implemented, and data secured, user education becomes the key component to ensuring that IT provides a secure platform for improved efficiencies and increased effectiveness expected across all job roles.





References
Garnter. (2013). IT Governance. Retrieved from http://www.gartner.com/it-glossary/it-governance

IT Governance Ltd. (2015). Federal IT professionals: insiders the greatest cybersecurity threat. Retrieved from http://www.itgovernanceusa.com/blog/federal-it-professionals-insiders-the-greatest-cybersecurity-threat/

TN Department of Health. (n.d.). HIPAA: Health Insurance Portability and Accountability Act. Retrieved from http://health.state.tn.us/hipaa/

Technological Evolution - Quantum Computing, Memristors, and Nanotechnology

It is amazing how evolution of technology changes perspectives so quickly on the future. With holographic interactive screens currently in use, memristors and atomic-level transistor technologies at our fingertips, and new developments in using light as a means to interact with systems or store system data, the reality of AI and systems like Jarvis are finally able to go from drawing board concept to real life prototype. For as long as I can remember, I have been talking about quantum computing and nanotechnology and how that is the future of systems and human interactions. As a younger teen, when I first started learning about quantum mechanics and ultra microscopic hardware theories, I saw then that the future of computer systems and computer-human interactions were going to be largely logic based and function faster than the speed of human thought. By marrying the concepts of quantum mechanics and advanced computer system theory, intelligent systems and true AI are highly viable and will be here within the current generation. As advances in nanotechnology take transistors to the subatomic level, and theories in quantum computing become a reality, we are quickly going to see the industry change as the traditional system paradigm is shattered, and a new evolution in technology is ushered in - I would call it the quantum age - where Schroedinger's cat can exist in both physical states without the concern of observation tainting the true reality of the objects existence. The potential gains with quantum processors and quantum computing methods that scientists around the world are currently developing into physical models are, at the moment, limited only to manufactured hardware capacities. As physical hardware capacities become perceived as unimportant to system planning schemes - due to advances like the memristor and photonics, including the newest nano-laser (see reference) - the focus can be given to writing programs that can take advantage of this new systems paradigm. What is going to take time is the change in mindset to understand how to use a quantum system because it requires a completely new approach to hardware and software design. Modern systems process data in a linear manner, processing one bit after another based on the time slice protocol programming in to the operating systems and CPU itself. Regardless of how many processors you throw at a system, it still only processes one bit of data at any given time slice. The fastest super computer, China's Tianhe-2, can process more than 6.8 quadrillion bits per second (3.12 million processors x 2.2GHz each = 6,864x10^12 processes per second), but it still only processes one bit at a time. Quantum systems do not function in this manner, they function in a far different reality where a bit can be both a 1 and a 0 simultaneously within a single time slice, though quantum processors would not use a time slice function, it would require something else yet to be defined. As scientists gain a better understanding of how to create a truly quantum computer systems, and quantum capable operating system, we will see technology advance to arenas yet to be discovered. What we once called science fiction, is quickly becoming scientific fact.

~Geek


References:http://www.sciencealert.com.au/news/20143009-26256.html (nano-laser)
http://www.top500.org/system/177999 (Tianhe-2 details)

Technology Roadmap - Wearables

Since I started working on my Masters in Information Systems, I have been learning a lot about many different aspects of IS.  Aside from it really helping me focus my perspective on what I want to end up researching for my post-grad work, I really have been enjoying all that I am learning, and this recent class (as of this post) is no exception.

The last paper I did in this class, CGMT557 Emerging Technologies & Issues, was to create a technology roadmap for an emerging technology.  While it is something I blogged on about a month ago, I chose wearables to extend the concept into a full plan.  Here's my 2 cents...~Geek

Technology Road Map: Wearables

Current State of Technology

            Wearables are extensions of our smart phones, tablets, and phablets offering a set amount of capabilities that are inferior to our smart devices but highly functional as they are currently designed.  With innovations through miniaturization and improved power efficiencies, curved glass high resolution screens, products like the various takes on the computerized watch accessory, Samsung Gear Fit bracelet accessory and other exercise monitors, Google Glass wearable computers, various applications of systems embedded into clothing for various purposes (muscular development, health monitoring, etc.), biological chips that hold medical conditions and history details embedded under the skin, are all wearable technologies that are already changing how a lot of services are being delivered.  Through improving miniaturization processes and improved manufacturing capabilities through more precision automation systems these wearable technologies will cause market disruption for various products that currently dominate the technology market such as laptop computers and other larger portable computing devices.

Business Initiatives and Drivers & Technology Landscape

            As the mobile workforce continues to expand through thinner and lighter computing devices with more available connections to high-speed access points, many businesses are able to follow their normal workflows without being physically tethered to their offices.  Currently there is a suite of devices that enable the mobile workforce, including smartphones, tablets, and laptop computers.  Their integrated devices, security feature sets, and in some instances rugged designs, lend themselves to providing a highly portable and productive work platform available from any location with a data connection.  As a sales person in a world of light speed communications and instant gratification, being able to access critical customer and product metrics with a couple taps of a fingertip are the difference between generating and landing opportunities versus potentially losing them completely.  Combined with back office line-of-business applications linked through the Internet, the mobile workforce is able to efficiently and effectively conduct business without geographic limitation.  Wearable technologies aim to revolutionize how business is conducting allowing for more efficient multitasking through wearable communication devices, powerful wearable computers, biological microprocessors that can use near field communications to interact with the environment and connect to wireless Internet devices to retrieve data from corporate data warehouses that then use the wearable computers to process and display said information for use and/or sharing.  Nanotech devices that can enable video and audio communications through cybernetic-like implants beaming high quality, high definition signals directly into the users sensory receptors providing for an immersive experience that functions at the speed of thought.  These same nanotech devices, once outfitted with artificial intelligence logic and processing, would become the next generation of executive or administrative assistant, able to recognize trends in a user’s usage patterns to help to anticipate potential reactions to situations and provide guidance on how to successfully navigate the landscape while providing useful data streams of relevant information enabling an intelligent and informed decision process.  When a worker is presented with all the relevant data pertaining to a situation and is able to perceive all the potential outcomes of reactions to interactions, with the assistance of intelligent nanotechnologies, they are able to make the best choice for a given situation resulting in improved satisfaction, a higher probability of positive outcomes, and in turn increased revenues. 

Gap Analysis & Migration Strategy

            In order for wearable technologies to successfully transition into the enterprise on a wide-spread basis, there are a few key gaps that need to be addressed as this emerging technology evolves.  The first gap to be addressed is the technologies themselves, as a majority of these capabilities are either in their early stages of development or are only partially implemented.  As mentioned, wearable technologies are currently used as accessories for their larger host devices integrating key functionality into said accessory, such as voice-to-text/text-to-voice capabilities, capturing of health data for monitoring purposes, both capable without the use of large or complex devices that may or may not be portable themselves.  In order for wearable devices to successfully evolve into independent computing systems, circuit, transistor, and storage technologies must continue to miniaturize to nano-scale form factors.  With the recent developments of carbon nanotubes and memristors these microscopic form factors are becoming reality.  There is a group out of Australia that has successfully created a nano-transistor that is a single phosphorus atom, whose atomic radii is 0.098 nanometers.  This is a direct step into nano-transistors that, once the research is complete, will result in sub-nano scale computing methods, and is should lead to quantum computing.  This would establish the foundation for very powerful systems that could be easily embedded into biological hosts to enable the advanced collaboration and communication methods necessary to conduct business in the next generation. The next gap to analyze would be embedding these systems into biological hosts, taking advantage of the bioelectricity generated to maintain continuous power states as well as neurologically connecting said bio-hosts to these nano systems to provide cohesive functionality that does not impede either entity.  Currently no solutions exist, however neural and material sciences have made advances creating technologies that can mimic such environments, and thus lead to an understanding on how to interface with them directly through biological and chemical processes.

Governance

            The Federal Communications Commission (n.d.) website states that they regulate interstate and international communications by radio, television, wire, satellite and cable in all 50 states, the District of Columbia and U.S. territories.  They are the primary authority for communications law, regulation and technological innovation.  As such, they would be responsible for mandating policy on how to manage the integration of nano devices into mainstream use and where their use is inappropriate.  As the industry evolves and technologies continue to shrink, the FCC will be at the forefront of determining how and when the use of these technologies is ultimately appropriate for public integration once the core infrastructure is in place.  Currently, there are no specific laws dictating how or when these devices can be used, only that they cannot actively interfere with other electronics, and must receive interference from other electronics, such as is the standard mandate of all consumer electronics based on the stamp shown on each device approved by the FCC for use.

Conclusion

            There has been a shift happening the past couple decades that the author has been tracking along with some peers.  As technology advances and devices continue to shrink in size while increasing in power users are following suit by moving from clunky desktop systems, to laptops, to ultra-books, to tablets, smart phones, and now wearables.  With as capable as wearable computing is commercially available today, combined with the research being done in nanotechnology and artificial intelligence and cloud-based service offerings and vast storage facilities, the future of wearable computers is already well in hand, with more innovations coming as we begin to fully understand how to manipulate and integrate such technologies as nanotubes and nanowires to allow us to take computing capabilities down to microscopic levels.  The potential is nearly limitless, with the ability to theoretically build nanomachines that are self-sufficient, self-reliant, and highly aware.  Wearable microprocessors that are embedded in a person’s skin could be the hub that enables personal interactions with our various devices and daily system interactions, also medical facilities, civil and government facilities, as well as large scale advertisements to provide a highly customized and personal experience not previously capable.  There are privacy and security considerations to be understood, which will require that regulations be put into place to protect the providers of these devices as much as it protects the users of wearable devices.  Those can only be realized as these technologies continue to be developed and infiltrate the professional realm.

References

98 Pm in nm. (2014). Retrieved from http://tejji.com/convert/length-metric.aspx?q=98-Pm-in-nm

Anthony, S. (2013). Killing silicon: Inside IBM’s carbon nanotube computer chip lab. Retrieved from http://www.extremetech.com/extreme/147596-killing-silicon-inside-ibms-carbon-nanotube-computer-chip-lab

Federal Communication Commission. (n.d.). What We Do. Retrieved from http://www.fcc.gov/what-we-do

University of Phoenix. (2014). Week three supporting activity: effect of emerging technologies on services. Retrieved from University of Phoenix, CMGT557 - Emerging Technologies and Issues website.

Size of phosphorus in several environments. (n.d.). Retrieved from http://www.webelements.com/phosphorus/atom_sizes.html

Smith, D. (2012). Nano-transistor breakthrough to offer billion times faster computer. Retrieved from http://www.smh.com.au/technology/sci-tech/nanotransistor-breakthrough-to-offer-billion-times-faster-computer-20120221-1thqk.html

Wearable Technologies: An Academic Discussion

For the moment, wearables are extensions of our smart phones and phablets offering a set amount of capabilities that are inferior to our smart devices but highly functional as they are currently designed. With innovations through miniaturization and improved power efficiencies, curved glass high resolution screens, products like the various takes on the computerized watch accessory, Samsung Gear Fit bracelet accessory and other exercise monitors, Google Glass wearable computers, various applications of systems embedded into clothing for various purposes (muscular development, health monitoring, etc.), biological chips that hold medical conditions and history details embedded under the skin, are all wearable technologies that are already changing how a lot of services are being delivered. Through improving miniaturization processes and improved manufacturing capabilities through more precision automation systems these wearable technologies will cause market disruption for various products that currently dominate the technology market such as laptop computers and other larger portable computing devices. There has been an shift happening the past couple decades that I have been tracking along with some peers. As technology advances and devices continue to shrink in size while increasing in power users are following suit by moving from clunky desktop systems, to laptops, to ultra books, to tablets, smart phones, and now wearables. The newest small, accessory-like devices have more computing power contained in them, and technical capability, than did the first dozen computers I owned growing up, combined. With as capable as wearable computing is commercially available today, combined with the research being done in nanotechnology and artificial intelligence and cloud-based service offerings and vast storage facilities, the future of wearable computers is already well in hand, with more innovations coming as we begin to fully understand how to manipulate and integrate such technologies as nanotubes and nanowires to allow us to take computing capabilities down to microscopic levels. The potential is nearly limitless, with the ability to theoretically build nanomachines that are self sufficient, self reliant, and highly aware, that could be able to repair genetic defects within DNA that result in terminal illnesses, mental disabilities, or other debilitating genetic predispositions passed down through the generations. Wearable microprocessors that are embedded in a persons skin could be the hub that enables personal interactions with our various devices and daily system interactions, also medical facilities, civil and government facilities, as well as large scale advertisements to provide a highly customized and personal experience not previously capable. Are there be privacy concerns, of course. Will there be instances of data theft, of course. Will it be a deterrent for mass adoption of such systems, no I do not think so. This is not different than the current state of things with our smart phones, tablets, phablets, laptops, flash drives, and cloud-based facilities. With as convenient as it becomes for dealing with usually stressful situations, such as going to the doctor, visiting a busy DMV, or being able to pay for products in a crowded store quickly, people would begin to see the benefits of convenience begin to far outweigh the potential invasions of privacy. Being able to have your personal details quickly at hand, regardless of what level of detail the user decides to include, does provide the basis for process innovation through technological innovation. Wearables will become the primary outlet for the next generation of data sharing and digital interaction.




What do you think about the future of wearable technologies? ~Geek