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Need for IT in businesses

Discuss about the Impact of IT on Competitive Business.

The emerging technology has dramatically transformed the business and the society. In this ever competitive world of today, every business needs to be ahead of the race, beating their competitors. Information Technology (IT) is the utmost necessity of the present day. For any business to be successful, the need for IT is unequivocal. IT is radically changing the landscape of the business scenario these days. The world has come a long way since the days of manual labor to the modern day scenario of technological advancement. It is a given fact that technology has taken over the reins of business and subsequently the society in the modern day set up. This report discusses the significance that IT has on business nowadays. It discusses the reason why business need IT and the importance of IT in the survival of the business. It also discusses the procedure and the requirement of applying IT into the business, benefits and risks that comes with the inclusion of IT into a business. The write up takes the example of Woolworths, a major Australian retail company to exemplify these points.

Information Technology is the use or the study of systems like computers and telecommunications for sending, retrieving and storing information. In the world of today, information technology has become the skeletal framework of any business. Information technology helps in faster dissemination of knowledge and information over the world. Right from expansion to the inner workings of a company, everything in the world of today is dependent on IT. It is difficult to imagine any business that has not been benefited from the inclusion and advancement of IT (Wu, Straub and Liang 2015). The advent of technology has had a tremendous impact on the businesses of this world. Nowadays, almost the maximum part of the productivity of a company depends on the IT (Atkinson 2013).

The inclusion of information technology has become an integral part of the business set up of our world. Larger businesses have their own IT department designed for the maintenance and upkeep of the software that is being used. Smaller businesses on the other hand, outsource or have a smaller scale of the IT department (Nambisan 2013). Business in sectors like finance, education, security and healthcare is greatly dependent on information technology. The impact of IT on business can be broadly categorized into four groups. They are:

  • Productivity
  • Transformation of business process
  • Transformation of business network
  • Transformation of business scope

IT for the survival of businesses

The productivity of any business undoubtedly has benefitted a lot with the inclusion of IT. IT has reduced the time and effort that is needed for the production of a particular good and service considerably. Therefore, the production of a company can increase manifold. The business process is transformed significantly with the inclusion of IT (Venkatesh, Thong and Xu 2012). The production time is reduced considerably with the inclusion of IT. The transformation of business network is one of the most important aspects of the impact of IT on business (Mithas et al. 2012). With the increase in the speed of production has helped to drastically change the scope and opportunity of a business. It has helped to create new opportunities for the expansion of the business. The advent of IT has made the inclusion of huge physical infrastructural requirement a thing of the past. It has helped businesses – large or small – create and delve into new spheres of prospects (Aykin 2016).

Nowadays, businesses require IT to survive in the fiercely competitive market. Businesses require information technology in every sphere in order to succeed. A company has a lot of sections and branches. IT helps the company to stay interconnected and function smoothly. It helps in enabling a transparent transfer of information across the globe. If the example of the Australian retail giant, Woolworths is considered, then it can be observed that it quite obviously relies greatly on the role of IT. Woolworths is a retail giant selling groceries and stationary items in Australia. It owns and operates about 980 stores across Australia. It also has its business in New Zealand. Therefore, it can be understood that the company relies greatly on information technology to run its business smoothly (Woolworths Online, 2017).

The inclusion of information technology is however not an easy process. Many factors have to be kept in mind when a company or a business wants to expand and include IT in its operations. There are various stages before information technology can be applied to a business. They are cost, planning, designing, equipment installation and training.

Cost of applying IT into a business or a company is the most basic and foremost area which needs to be considered before anything else. The expenditure that the process of inclusion of IT into a business will earn is not trivial. It is a huge amount of expenditure that needs to be accounted before planning out the budget of the company of a year.

Application of IT into business

For applying IT into a business, a certain amount of planning is required. Before the inclusion of information technology, the management of a company needs careful planning and thinking about the process. The companies require to have an extremely systematic approach to plan out the process. The company need to monitor the areas that urgently require the inclusion of IT and needs to identify which areas will be benefited by the inclusion (Sherman 2012).

Designing is an essential infrastructural prerequisite that needs to be considered before the inclusion of IT in any business or company. This part requires a more skillful approach. It deals with the basic element of designing of how the process should go about while implementing IT in the business (Sargent, Hyland and Sawang 2012).

Equipment installation is the most pivotal of stages of applying IT into a business. In this stage, as can be understood from the term, the equipments are installed and the process is stated. This stage requires the presence of experts so that they can oversee the process of installing the equipments. The equipment installation is one of the most basic stages of the process of inclusion of IT in businesses. A company can outsource candidates and employees to perform this stage.

Once the machines and the equipments are installed, the main task that remains for the management is to train the employees and the workers how to operate and be familiar with the machines and the equipments. The training requires the experts to train the employees of the company. Once this process is completed, and the employees or the workers are familiarized with the equipments and the machines and once they know how to operate and work with the new technology, the operation and the process becomes smooth and easy (Bloom et al. 2014).

The inclusion of the information technology greatly benefits the staff and the employee as it reduces the work pressure and also finishes the work in a more accurate and correct manner. The customers and the suppliers are also benefited by the inclusion of IT in business. The inclusion of technology has enabled the customers of a company to avail the goods and services in a easier fashion. Right from the purchasing stage to making the choice to buy a product, everything has been made easier for the customers. Nowadays, the customers can see the list of items or services that the company is offering through the website of the company. Companies like Woolworths strictly adhere to the help taken from IT in luring in consumers. Purchasing has also been made easy with the help of IT (Brynjolfsson and McAfee 2012). Nowadays people hardly use cash for any kind of transaction. They rely greatly on plastic money that is credit card, debit card, online transfer and net banking to complete any kind of transaction. Australian retail giant like Woolworths, like any other business, rely greatly on technology to run its business. The website of this company has a detailed description and mention of the goods and services that they sell and provide. The consumers can choose and make an informed decision about the products that he or she wants to purchase. It mentions the availability of products and the discounts on any particular product that is offered by the company. Similarly, the suppliers are also greatly reliant on information technology to serve the business better. They use the technology to monitor and keep a track of the orders and the demand of a particular product. The use of information technology has made the process of supplying goods to the supermarket retail chain all the more easier (Davenport 2013).

Equipment Installation

There are many advantages of information technology on businesses. They are:

  • One of the most significant advantages of including IT in the business is that it has sped up the process of production. Businesses take the help of technology to speed up tasks. With its high-speed capability, it reduces the production time and thus cuts back on the cost. It greatly reduces the cost of production of goods and services of a company. It helps to automate the production of goods, which in turn reduces the cost of production, which in turn helps the companies to enjoy maximum profit (Dedrick, Kraemer and Shih 2013).
  • The inclusion of information technology greatly increases the flexibility of the company. It offers the flexibility to the company as it helps the employees and the management to coordinate and irk from anywhere across the globe. With the advent of technology, businesses can easily think of expanding its ventures overseas for better and brighter prospects. The employees deployed at a particular venue can manage and perform their jobs well. They can coordinate with the top management placed elsewhere and get a clear perspective of the objective of the businesses (Chao and Chandra 2012). The management on the other hand, can get a clear and vivid picture of what the situation is like overseas from the employees that are placed there.
  • Technology helps the companies to generate and earn revenue at a greater scale. It helps the businesses to achieve a larger area from which revenue can be generated. The revenue earned is greater as technology helps the employees of the company to be placed at different places of the world and still make a profitable business. It also helps to increase the revenue by speeding up the process of production.
  • Technology helps in the storing and managing of files and data of a company. Businesses use technology to store and backup data. It saves on the time and effort that paperwork brings along. The data that is stored can be accessed from anywhere across the globe (Hensen and Lamberts 2012).

Along with the advantages, there are also few disadvantages that information technology brings along when it is incorporated into a business. They are:

The inclusion of information technology in a business brings along many security issues with it. When a business becomes very reliant on technology, it faces a risk of cyber harassment and cyber crimes, which jeopardizes the prospect of a business in the market. It loses out on the profit making motive and tries to concentrate on warding off the security issues.

A business or a company has many things that are private to the company and must remain so. However, whenever there is an error or a glitch, the company becomes vulnerable to the privacy threats that may harm the company.

Technology nowadays has replaced many positions, which means that it has reduced the positions. This means that the job market has shrunk considerably owing to the inclusion of technology in businesses.

The implementation of information technology into a business or a company comes with a lot of expenditure. While the big companies can easily afford this process, it becomes harder for the smaller businesses to afford this expensive technology. This means that they end up losing out clients to a business.

In the world of today, businesses cannot function without information technology. However, businesses and companies have to monitor and maintain the technology to obtain a smooth and effective operation. Information technology helps in the smooth running of the business. However, it has to be monitored and maintained to achieve the maximum output. The companies have to take measures like monitoring the security breaches in the technology, backing up data and obtaining a secured network (Kleis et al. 2012).


In the competitive world of today, it has become imperative for businesses to achieve maximum profit and productivity.  With the dawn of information technology, computers and devices for communication, such as smartphones, have become the principal tools for conducting business. IT gives companies the scope to outsource employees from remote locations and reduce the costs connected with conventional recruitment techniques. The impact of IT on businesses is undoubtedly huge. With the recent developmental leaps that the area of technology is taking, it can be safely said that IT is going to be the future of all businesses.


Atkinson, R.D., 2013. Competitiveness, Innovation and Productivity. The Information Technology & Innovation Foundation.–August, pp.2-7. 

Aykin, N. ed., 2016. Usability and internationalization of information technology. CRC Press. 

Bloom, N., Garicano, L., Sadun, R. and Van Reenen, J., 2014. The distinct effects of information technology and communication technology on firm organization. Management Science, 60(12), pp.2859-2885. 

Brynjolfsson, E. and McAfee, A., 2012. Race against the machine: How the digital revolution is accelerating innovation, driving productivity, and irreversibly transforming employment and the economy. Brynjolfsson and McAfee. 

Chao, C.A. and Chandra, A., 2012. Impact of owner's knowledge of information technology (IT) on strategic alignment and IT adoption in US small firms. Journal of Small Business and Enterprise Development, 19(1), pp.114-131. 

Davenport, T.H., 2013. Process innovation: reengineering work through information technology. Harvard Business Press.

Dedrick, J., Kraemer, K.L. and Shih, E., 2013. Information technology and productivity in developed and developing countries. Journal of Management Information Systems, 30(1), pp.97-122. 

Hensen, J.L. and Lamberts, R. eds., 2012. Building performance simulation for design and operation. Routledge. 

Kleis, L., Chwelos, P., Ramirez, R.V. and Cockburn, I., 2012. Information technology and intangible output: The impact of IT investment on innovation productivity. Information Systems Research, 23(1), pp.42-59. 

Mithas, S., Tafti, A.R., Bardhan, I. and Goh, J.M., 2012. Information technology and firm profitability: mechanisms and empirical evidence. 

Nambisan, S., 2013. Information technology and product/service innovation: A brief assessment and some suggestions for future research. Journal of the Association for Information Systems, 14(4), p.215. 

Sargent, K., Hyland, P. and Sawang, S., 2012. Factors influencing the adoption of information technology in a construction business. Australasian Journal of Construction Economics and Building, The, 12(2), p.72.   

Sherman, A.J., 2012. Raising capital: get the money you need to grow your business. AMACOM Div American Mgmt Assn.

Venkatesh, V., Thong, J.Y. and Xu, X., 2012. Consumer acceptance and use of information technology: extending the unified theory of acceptance and use of technology.

Woolworths Online. (2017). Woolworths Supermarket - Buy Groceries Online. [online] Available at: [Accessed 23 Jan. 2017]. 

Wu, S.P.J., Straub, D.W. and Liang, T.P., 2015. How information technology governance mechanisms and strategic alignment influence organizational performance: Insights from a matched survey of business and it managers. Mis Quarterly, 39(2), pp.497-518.

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