Information technology（一）

ACCA P3考試：Information technology

THE STRATEGIC USE OF IT

The Paper P3 syllabus contains an important section titled ‘Information technology’. Three sub-sections of that section refer to e-business applications:

• e-business application: upstream supply chain management

• e-business application: downstream supply chain management

• e-business application: customer relationship management.

Although it is useful to categorise e-business applications in this way, you will realise that it can represent an over-simplification of what happens in real life as the categories can interact and overlap. For example, downstream supply chain management (basically, the sales side) will be closely related to customer relationship management.

Similarly, some of the most successful modern businesses work very hard to link closely the downside and upstream (purchasing and production) sides of their operations.

When analysing or advising on the use of IT by businesses you should always try to make use of theories, models or frameworks. Some of these are fundamental to any discussion of business strategy; some are more focused on the use of IT. The theory and frameworks which I will refer to are:

• The value chain

• Generic strategies

• The 6‘I’s of e-business

• Michael Earl’s analysis of how organisations’ use of e-business evolves.

We will start with brief revision of each of these models, then we will look at some real-life examples of how companies have employed IT, relating their use back to models as appropriate.

The value chain

The value chain sets out all the groups of activities that a business performs, and seeks to identify what the business does to give it the right and ability to earn profits. The value chain is therefore perhaps the most fundamental model there is: value has to be added if any profits

are to be made at all. Value chain theory emphasises how important it is to identify linkages between activities. For example, better technology development is likely to result in more efficient operations and fewer units needing after-sales service and repair.

There is no problem at all seeing how information technology could be used in each activity:

Value chain component	Examples of the use of IT
Firm infrastructure	Accounting system, corporate intranet, email
Technology development	Computer aided design, automated software testing, internet searches for new discoveries and processes
Human resource management	Skills databases, manpower scheduling, computer based training, performance monitoring
Procurement	Ordering process, supplier databases
Inbound logistics	Material resource planning （MRPI）, manufacturing resource planning （MRPII）, just-in-time inventory management
Operations	Computer aided design, computer aided manufacturing, automated production lines, robotics
Marketing and sales	E-commerce, internet advertising, customer relationship management
Service	Fault monitoring, quality control systems, computer aided design.

However, just because IT can be used does not mean that value will be added, and if value is not added profits cannot be improved.

Inappropriate use of IT could harm a company’s prospects. For example, there is little point in automating production if what your customers cherish are hand-made, individualised products.