Introduction
The business environment has become very challenging during the 21st century. One of the factors that have led to this transformation is increased complexity emanating from the external business environment. In an effort to attain their profit maximisation objectives, most firms have incorporated the concept of expansion through internationalisation. Consequently, most industries around the world have experienced an increment in the intensity of competition. Over the past decade, countries within the retail industry in the Gulf Cooperation Council such as the United Arabs Emirates [UAE] have experienced a significant increment in the intensity of competition.
Most companies have become cognisant of the significant market potential in the UAE. A research study conducted by Alpen Capital in 2010 revealed that retail sales from supermarkets and other retail chains will expand with a CAGR of 10.7 per cent during the period ranging between 2010 and 2015 (Alpen Capital, 2012, p. 3). This growth in the retail sector is associated with a number of factors such as an increment in the size of population, emergence of a highly urbanised population, and development of first-class infrastructure thus leading to significant growth in the number of expatriates and international shoppers. Despite the growth, competition will heighten significantly.
In a bid to survive in such an environment, it has become imperative for firms in different economic sectors to formulate effective operational strategies that will enhance their competitive advantage. Implementation of emerging information systems is one of the avenues that firms are increasingly considering as an important element to improve their competitive advantage. Therefore, this paper gives a comprehensive analysis of various issues with regard to managing information systems in supply chain framework.
Company profile
Identification of main challenges faced in managing IS change
In an effort to attain a high competitive advantage in its supply chain, the firm appreciates the importance of implementing the concept of information systems. An Information Systems entails a set of software, hardware, infrastructure, personnel, planning, coordination, control, and decision making in an organisation. The decision to implement IS was motivated by the need to deliver more value, enhance its competitiveness with regard to retail experience, and touch the lives of its consumers.
Despite this move, the firm faces a number of challenges with regard to implementation and managing Information Systems. Previous studies show that most firms fail in their effort to implement Information Systems. As a participant in the process of implementing IS change in Al Safeer’s supply chain, there are two main challenges that one is likely to encounter. They relate to inter-departmental relationships and organisational processes and structure. These challenges are illustrated below.
- Interdepartmental relationship challenge- Some of the interdepartmental relationship challenges that are likely to be encountered relate to interdepartmental conflicts, lack of cooperation, and lack of independence.
- The organisational process and structure challenges will be associated with organisational adaptability.
Setting the goal
In a bid effectively deal with these challenges, the two main goals are critical here. They include:
Establishment of optimal interdepartmental relationships plays an important role in the success of every firm. This aspect arises from the fact that firms should operate as a single unit. Therefore, operations of the various organisational departments should contribute towards the attainment of the intended synergy. In its operation, Al Safeer has established a number of departments, which include production, finance, and marketing. In a bid to achieve its goal of delivering value to its customers, all the departments must work towards attaining the established organisational goal. For example, the production department must design and produce products and services that are in line with the customer’s needs. However, this aspect is only realisable if the finance department provides the required amount of funds to undertake the production. One the other hand, the marketing department must formulate effective marketing strategies such as pricing, promotion, and distribution.
Implementing information systems will increase the degree of collaboration amongst the various departments. This assertion arises from the fact that all the departments will be in a position to share critical information relating to various operating activities more effectively and efficiently. Currently, the emergence of the Internet and intranet technology has improved the effectiveness and efficiency with which departments interact. In the case of Al Safeer, it will be possible for the various departments to communicate on various issues. For example, the production department will be in a position to communicate to the procurement department regarding its material requirements, plans, and schedules.
The procurement department will be in a position to inform the production department on raw material and supplier availability. Similarly, implementing IS will increase the effectiveness with which the finance department works with the other parties in the supply chain such as suppliers, utility providers, and credit financiers, which will play an important role in improving relationships within the supply chain. Ultimately, such collaboration will significantly improve the firm’s operation for the various departments will be in a position to reschedule their operational plans in the event of a certain challenge. This element well illustrates that no single department should operate in isolation.
However, the existence of interdepartmental conflict may result in failure in the process of implementing the IS system. For example, some employees may develop a perception that implementing the IS will curtail their operational independence due to the misconception that the department will be required to be accountable to other departments. Additionally, some parties within the supply chain may develop a perception that the Information System will culminate in the firm incurring a substantial capital cost. This assumption arises from the fact that for the Information Systems to operate there are a number of prerequisites that the firm will be required to address. One of these issues relates to ensuring a high degree of inter-operability. For example, the firm will be required to purchase and implement specific hardware and software products to ensure effective communication across inter-organisational departments. This assertion hinges on the fact that the implemented Information Systems between the two parties must be compatible. Such requirements may hinder managing change with regard to Information Systems in the firm’s supply chain.
In a bid to enhance interdepartmental relationships, the involved parties will ensure that interdepartmental conflicts are eliminated by establishing a high degree of cooperation amongst the firms’ department and other parties within the supply chain. In an effort to eliminate the cost constraint associated with implementation of specific hardware and software, the firm will implement a simpler technology that will achieve the same technology. One of the technologies that the firm will consider relates to emerging networking technologies. The firm will ensure that it integrates these networks into its Information systems. Additionally, the firm will ensure the security of the information in the course of its transfer through these networks, which will be attained by undertaking effective configuration of the networks.
In determining the extent of success in dealing with interdepartmental conflicts, one of the measures that will be used relates to evaluating the degree of collaboration amongst the various parties in the supply chain. One of the elements that will be considered relates to the level of shared awareness amongst the various stakeholders. Additionally, the firm will carry out an evaluation of the reliability of the information provided. Upon ascertaining that the information provided is reliable, it will be possible to assert that the various stakeholders are utilising the information system. Considering the fact that opportunities have a short window, the firm will ensure that it deals with the challenge with within the shortest time possible. The firm will implement the network within a period of one month.
Organisational process and structure challenges
In its operation, Al Safeer has established a specific culture that defines its operations. The organisational culture developed determines the knowledge applied in executing various operational tasks. It also explains the set of ideas, rules, and generally, acceptable standards considered in undertaking particular decisions. The organisational culture established in a firm determines how organisational employees operate with specific reference to communication, language, strategic change, managerial change, and utilisation of knowledge.
Organisational culture plays a critical role in the process of implementing and managing new Information Systems in a firm. Implementation of new IS changes various aspects of organisational culture. One of the issues that are directly affected relates to standards of operation. Failure to take into account the element of culture can result into failure in the process of managing IS change. This challenge does not only persist in organisations that are not only new to information systems technology, but also to firms, which have implemented IS technology as a routine in their operations such as Al Safeer Group of Companies.
Employees who have a well-established system of practices, beliefs, and attitudes utilise information systems. Consequently, it is irrational for any firm to impose new IS to employees without considering their concerns. However, firms can deal with this challenge by addressing external environment needs by adopting relevant technologies. The success of the firm in managing IS change in its supply chain will rely heavily on its commitment in assessing the prevalent organisational cultures with regard to technology adopted by the various parties in the supply chain.
One of the issues that Al Safeer should consider relates to the technology philosophy adopted by parties in the supply chain. This element will play an important role in determining how implementation of the new IS will affect the firm’s operations. In implementing the IS change in its supply chain, Al Safeer will consider the process as a group undertaking rather than an individual affair. Integration of the concept of teamwork will significantly contribute towards a better understanding of the culture of the various stakeholders.
In an attempt to deal with the challenge emanating from cultural differences, the firm will measure the extent of cultural integration with specific reference to Information Systems technology. The analysis will aid in the identification of the cultural differences that exist between the firm and other parties in the supply chain. Determination the degree of integration will be undertaken by analysing the extent to which the technology culture of the supply chain stakeholders is congruent with that of the firm. Consequently, it will be possible to evaluate the degree of adaptability amongst stakeholders. Considering the dynamic nature of information technology, it is important for the firm to evaluate how supply chain stakeholders are adaptable to technological changes. Consequently, Al Safeer will be in a position to make optimal decisions with regard to managing IS change within their supply chain. Understanding an organisation’s culture is a complex process. As a result, it is expected that determination of the culture of parties in the supply chain will consume a considerable duration. Duration of one month will be set aside to conduct a sufficient research on the culture of the various stakeholders.
Factors that will directly affect the attainment of these goals, measurement, and timescale
The success with which the above goals will be attained is dependent on a number of factors. Some of these include leadership, equity, and involvement in the decision-making process, and communication.
Effective leadership
Implementing and managing change with regard to information systems in the supply chain is a complex process. Therefore, it is paramount for Al Safeer to integrate effective leadership styles and aspects. In a bid to ensure success in managing IS change in its supply chain, Al Safeer should adopt value-based leadership. This involves a leadership style that aims at creating a vision for the action undertaken. In addition to value-based leadership, it is also important Al Safeer’s management team to adopt transformational leadership. Currently, firms are experiencing an accelerated change with regard to information technology. Considering the high rate of technological innovation in the information technology sector, it is paramount for firms to adopt transformational leadership. This type of leadership style does not only focus on attaining the desired goals, but is also cognisant of the importance of benefiting the various parties involved in its operation.
Al Safeer should ensure that the leader is a change architect to manage IS change in its supply chain effectively. Transformational leadership plays an important role in a firm’s effort to meet the market demands. As a result, the leader should emphasise on ensuring that the integrated information systems improve the firm’s current and future competitiveness. The leader should also focus on developing an effective organisational environment that will enhance implementation of the change process. The leader charged with the responsibility of implementing and managing information systems in the firm’s supply chain should be a product developer. This assertion means that he or she should be IT savvy. As a result, it will be possible to trail and implement new information systems that will significantly improve the firm’s competitive advantage in its supply chain.
By adopting transformational leadership, it will be possible for the firm to develop a comprehensive understanding of the aspirations and goals of the Information Systems to be implemented amongst the various stakeholders of its supply chain. This element will improve the effectiveness with which the information system is managed. Transformational leadership should not have a timeline within which it should be implemented, but should rather be implemented continuously to ensure the realisation of the intended.
In an attempt to determine the effectiveness with which the leadership style adopted is successful, the firm should evaluate the degree of motivation and commitment amongst the employees in implementing the selected Information Systems. Value based and transformational leadership is very effective in influencing the employees positively. For example, they contribute towards a high level of satisfaction. Moreover, the firm should adopt a continuous evaluation on the effectiveness of the adopted leadership styles. This move will play an important role in identifying leadership deficiency areas. Consequently, it will be possible for the firm to undertake the necessary adjustment and ultimately the firm will achieve the desired outcome.
Equity and involvement in the decision making process
Considering the fact that the IS implementation involves a number of parties in the supply chain, Al Safeer’s management team should integrate the concept of equity and involvement in its decision making process. Al Safeer should ensure that the decision making process, with regard to information systems, is fair. One of the ways through which this goal can be attained is by integrating all the stakeholders in the decision making process. Involving the stakeholders will contribute towards the formulation of effective decisions regarding implementation of the information. Involvement of other stakeholders is important because Al Safeer’s does not operate in a vacuum.
The firm should nurture the concept of teamwork to address the issue of equity and involvement effectively. Teamwork will create an opportunity for all the parties involved to participate in the decision making process. The selected team should come from different departments. The objective of selecting team members from different departments is to ensure balance in the selected team. Therefore, their interests and concerns will be taken into account during the change implementation process. Additionally, teamwork will significantly improve the effectiveness of Al Safeer attaining the desired level of collaboration amongst the supply chain stakeholders. It will also culminate towards development of trust amongst the various stakeholders.
In a bid to measure the success with which the firm has integrated equity and involvement amongst the various stakeholders in the decision making process, Al Safeer should conduct a stakeholder analysis in order to determine their opinion regarding the information systems being implemented. Findings of the analysis will play an important role in determining whether the firm is successful or not. For example, if there are complaints emanating from the stakeholders on how the firm is implementing the IS change, the firm should identify this aspect as a weakness that should be adjusted. Al Safeer should ensure that there is equity and involvement in the entire implementation process meaning that stakeholders’ involvement should be ensured during the entire process of implementing Information Systems.
Communication
Effective communication is another factor that should be taken into account in an effort to create effective interdepartmental relationship and organisational culture. Lack of effective communication is one of the major challenges that firms face in their effort to implement organisational change. It is paramount for Al Safeer Company to implement effective communication between supply chain stakeholders. The firm should appreciate the role of developing strong communication between departments and across firms. Therefore, Al Safeer should establish a strong communication culture in its operation.
In its communication process, the firm should focus on two main issues, which include the intention for change and how the change will affect its employees. The change message should address the rationale for implementing the IS and the change basics, viz. what will change specifically and status update. Al Safeer should also ensure that the communication addresses how the stakeholders’ operations will be affected. Moreover, to influence the IS change process positively, the firm should maintain constant communication. As a result, the firm should be in close contact with the stakeholders. Updates on the progress of the implementation process should be undertaken from time to time. In addition, to measure the success of the communication, the firm should evaluate the extent with which the various stakeholders participate in the implementation process.
Conclusion
This paper recognises the importance of information system in improving Al Safeer Group Companies’ competitiveness in its supply chain. Implementing information systems in a firm’s operation cannot contribute towards attainment of the desired outcome if the change associated with the information system is not well addressed. Consequently, Al Safeer may face a number of challenges during the implementation phase. Some of these challenges associate with interdepartmental relationship challenges such as interdepartmental conflicts, lack of cooperation, and lack of independence. Additionally, the organisational processes and structures adopted by the firm will also influence the effectiveness with which the various stakeholders adapt to the change implemented. Therefore, to deal with these challenges, it is imperative for Al Safeer to develop strong interdepartmental and inter-organisational relationships.
This move will contribute towards the creation of a high level of collaboration amongst the various stakeholders. Establishment of effective organisational processes and structures will also improve the success of Al Safeer in managing IS change in its supply chain. However, one of the ways through which the firm can achieve this goal is by developing a strong organisational culture. The organisational culture developed by a particular firm has a significant impact on the effectiveness with which it succeeds in implementing information systems. Considering the fact that different firms have nurtured diverse organisational culture, it is crucial for Al Safeer to conduct a comprehensive cultural analysis of the supply chain stakeholders. Such an analysis is important in establishing the degree of cultural fit with regard to information systems technology. Al Safeer should take into account three main factors to deal with these challenges in a comprehensive manner, viz. ensuring effective leadership, equity, and involvement in its decision-making process, and communication.
References
Alpen Capital. (2012). Trade and capital flows-GCC and India. Web.
Bloomberg. (2012). Company overview of Al Safeer Group of Companies. Web.