Value Added Processes in Information Systems
Value Added Processes in Information Systems
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Information Technology (IT) is a key factor in transforming what consumers once considered goods into services. This transformation has important implications for organizations, changing the measurement of quality from manufacturing-to-specifications terms to meeting and/or exceeding customer expectation terms. Employees in the organization may respond with resistance to attempts to implement a new customer focus, not realizing the service nature of "information added" goods. Customer involvement is the overriding concept which is implicit in the difference between goods and services Specifically,• Customers spark the initiation of the production of the service.• Customers shape the service product during its production.• Customers use the service product immediately after its production.• Customer perceptions and expectations provide the measurement criteria for the quality of service.A transformation is defined as a dramatic and sustainable improvement in performance, achieved within an aggressive time frame, involving strategic repositioning, and enterprise-wide culture change -- an entirely new approach to doing business (Anonymous 1994). IT enables companies to transform themselves and their product offerings. A recent study characterized IT as enabling:… a company to pursue new strategies it never thought possible. It can be used by organizations to 'recast' their business processes, frequently in dramatic ways. The proper application of information technology can play an important role in improving the company's operations and enhancing its capability to react to a fast-moving environment … The role of information technology in a business has moved from that of supporting the business, in the form of data processing, to being the change agent, at the heart of strategy and process redesign (Anonymous 1994, 4-5).IT greatly changes the processes involved in providing products. It supports the automation of production facilities, increases the output of workers who manufacture goods, and enhances the ability of those manufacturing goods or those providing services to add information value to their activity. IT systems are so important that many businesses cannot survive without them (Ford 1994); whole fields of service industries now exist due to the presence of IT.Initial implementations of IT computerized manual systems or modified processes to allow for faster levels of activities (Ford 1994). Now IT increasingly adds value to products (Taylor 1986). Historically, IT enabled workers to produce goods more quickly and uniformly through mechanization. Today's IT includes the mechanization of manual processes along with an information value component. This information value component allows individual customization at the time of manufacture. Customers have varying expectations and needs, and no longer do all customers have to purchase the same goods, manufactured to one specification. Earlier IT could not readily accommodate a manufacturing environment that supported varying expectations and needs. With today's IT, customers can enjoy the savings of speedier manufacturing AND individual information value which customizes the product. IT enables yesterday's mass production of goods to become mass customization of goods, incorporating individual differences in the manufacturing process. The outcome of this manufacturing process is closer to traditional services than traditional goods.To gain a better understanding of this process, it is helpful to look at the influence of technology on the manufacturing of prosthetics. A case example, based on prosthetic limb replacement in Veterans Affairs facilities, illustrates the difficulty of a perceptual transition to new standards of quality and the importance of effective management in easing this process.