Integration of Business Systems With Business Strategy

Subject: Strategic Management
Pages: 11
Words: 3034
Reading time:
11 min
Study level: PhD

Introduction

Since the advent of the industrial revolution, business enterprises have been dependent on technology. However, that dependence on technology in the 21st century has reached unprecedented heights. Today, the internet presents a business platform with limitless opportunities for people to carry out business transactions. Online presence is no longer optional for businesses that want to survive competition in this era. The internet is just one of the areas in business where technologies especially through business systems have engineered an enterprise revolution. Growth in technology has led to the development of various systems that complement each other in different areas of business to deliver required results.

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Any business strategy nowadays which does not factor in the integration and use of information systems both in the short and long terms is doomed to fail. According to Thompson (2001, p. 57), effective use of systems especially information systems within business enterprises is one of the best ways of creating and/or gaining competitive advantage. Integration of business systems with business strategy is therefore primary to success of business. Initially, businesses had corporate plans which detailed how companies were going to implement corporate strategy. However, changes in business dynamics have forced companies to come up with plans on information systems as well. The basic idea being that integration of corporate strategy with business systems will benefit overall growth of the organization in the long-run through increased efficiency, reduced costs and increased revenue.

Despite the progress in development of strategy and business systems, various challenges still lurk along the way. Businesses especially small and medium enterprises have not fully realized the benefits that come along with the integration of business strategy and systems.

Problem statement

As mentioned above, not all businesses have reaped the benefits of business strategy and integration. One of the obvious reasons is that development and installation of these systems require resources beyond the means of these businesses. These enterprises are forced to choose between low cost technologies that do not deliver optimum value of no system at all. According to Joia (2003, p. 87), lilted or absolute lack of access to business systems and resultant failure to integrate business strategy and business system is endemic in many businesses not only in the UK but also worldwide. The problem is serious and the government estimates that businesses lose billions of dollars annually to inefficiencies caused due to limited or lack of business systems and integration with strategies.

This research will therefore be seeking to examine the above-mentioned problem among small and medium enterprises. Specifically, the research will investigate the prevalence of business systems among target businesses and the level at which the businesses have integrated strategy and systems. Research will take place from both strategic and informational perspective with further elaboration on how both perspectives will be explored given below.

Objectives

By undertaking this research, the research aims at:

  • Shedding light in the underlying problem of lack of business systems among small and medium enterprises
  • Showing that there is low integration of business and business strategy among small and medium enterprises
  • showing that business with installed business systems and a decent level of integration between the systems and business strategy are yet to reap the full benefits of the such an arrangement
  • finding out the main reason why business are yet to establish business systems and why there no or little integration
  • finding out if there is any benefit of installing business systems among businesses that have their strategies and systems integrated

Hypotheses

  • There is low uptake of business systems among small and medium enterprises
  • There is a low integration rate of business strategy and business systems among small business
  • Businesses with high integration of business strategy and systems are doing better than businesses without

Rationale

Findings from this research will help established business appreciate the need for adopting business systems and integrating them with their business strategies. Additionally, the findings will help those business leaders that are willing to adopt business systems make better judgments on which systems to adopt. For those with already installed and functioning systems, the findings will help them improve their systems through better integration with their business strategies. Furthermore, this research will act as the basis for further research by scholars on the area of business strategy and business systems.

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Research questions

The following questions will help guide the research:

  • What business systems do small and medium enterprises have in place today?
  • To what extent have businesses adopted business systems?
  • What is the level if integration between businesses and business systems?
  • What benefits do adoption of and integration of business systems and business strategies have?
  • Why have other businesses not adopted business systems?

Methodology

This section details the research methodology that will be used in the study. Precisely, the focus will be on the research design, research tools, population sample, methods of data collection and data analysis.

Research Design

This study will be done through survey on businesses especially small and medium enterprises. According to Kothari (2008, p. 63), research methodology of a study determines the credibility of the results. The main objective of the survey will be to determine the level at which small and medium enterprises have adopted business systems. The research will also be aiming at investigating the level at which these businesses have integrated business strategy and business systems. Additionally, the survey will aim at illustrating the impacts and the factors affecting adoption of business systems and its integration with business strategy. Quantitative data will be collected through administration of questionnaires on the target population. Besides questionnaires, both group and individual interviews will be conducted for purposes of obtaining qualitative data.

Population and Sample

The setting of the research in this study is London, UK. In this city like in any other town in the UK, there is a wide prevalence of small businesses which according to concerned departments are the main drivers of the UK economy. Most small businesses in the UK exhibit more or less similar characteristics. It is therefore assumed that investigation carried out on these businesses will generate data and results that can be generalized on other businesses elsewhere. There should be an effort for researchers to include both the qualitative and quantitative elements in a study (Singh 2007, p. 42).

Under the qualitative part involving interviews, the study focuses on carrying interviews with owners of businesses, people employed in those businesses, business owners union representatives, employee union representatives and government officials directly in charge of small business owners. These interviews will help in shedding light on the various aspects under investigation.

Data from the target group of business owners and other stakeholders as shown above will be obtained mainly through 20 focus interviews consisting of over 150 personnel who will participate according to availability. The number of participants in each group will vary from 20 to 25. All groups will comprise participants from both genders who will fall within the categories of stakeholders identified above. Emphasis will especially be given to business owners and their staff, members because they are in a better position to provide accurate firsthand information on the topic of investigation. Each group interview will take an average of 80 minutes to provide sufficient time to participants to exhaust the information they have. In some cases, research assistants may at their own discretion extend the time allocated to a group undertaking the interview. However, interviews with focus groups may be stopped when a research assistant feels the data obtained has become redundant. In other groups data will be obtained through formal individual interviews, informal interviews and on rare occasions, telephone interviews.

In quantitative data collection, over 50 small and medium enterprises in the city of London will be included in the study. The area is expansive with varying geography and numerous small businesses. The research will however focus on fifty which will be a representative sample of the business in the city. It is important to note that the study will generally focus on small businesses regardless of the industry they fall in. it is also important to reiterate that all participants will be people with both direct and indirect links to the SME sector.

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Participants will be recruited from all levels of the SME sector through cluster random sampling technique. The participating businesses will be randomly selected to be included in the sample. The number of participants recruited from each business will be determined by the size of the business through the size of revenue generated and number of people employed. SME’s with less than 50 permanent employees will contribute 35% of the participants while the remainder will be from the SME’s with fifty or more employees. The number participants from SME representative organizations will be done uniformly through random sampling. The sample size for the study is estimated at 825 people.

Research Tools

Questions for focus groups interviews as well as in-depth interviews and questionnaires will be made by the researcher and written in Standard English language. The lead researcher will seek the opinion of two English language experts for validation of the appropriateness of the language used in the questionnaires. Additionally, the lead researcher will seek professional help from the department of social studies in the London School of Economics which provided guidance on questionnaire formulation and administration. The guidance from the above sources will help in editing of the questionnaires and some of their suggestions will also be incorporated.

Data Collection

Collection of qualitative data will be done through focus groups interviews and in-depth interviews. In cases permission will be granted, researchers will use a recording device including audio tapes and mobile sound recorders to keep an excerpt of the audio interview. Additionally, research assistants will be taking notes field notes. It is important to note that throughout the recording of interviews, the confidentiality of participants will be ensured. No participant will be forced to have his interview recorded against his/her wish. Also, interviewees will have the option of using pseudo names or no identification at all. Most of the interviews will take place in the business premises of those that will be willing to grant audience at their venues. Other interviews will take place in town halls at the participants’ convenience so long as it is within the agreed dates.

Collection of quantitative data will take place after permission has been granted by the concerned authorities. The research assistants will explain to the participants the purpose of the research being undertaken as well as the processes that will be involved in the administration of the questionnaire. This will be followed by the distribution of questionnaires through accidental random sampling technique. There will be cases where research assistants won’t have access to some participants. Research assistants will therefore have to rely of the business administrators or one of the employees to distribute and collect the questionnaire forms. In places where participants will not be reached easily, administration of the questionnaire will be done through mail. In all the cases above, research assistants will make an effort to explain to the participants the mode of questionnaire administration in order to reduce cases of bias.

Literature review

There is a lot of literature concerning business systems and integration of these systems with business strategy. According to Leondes, business strategy is concerned with developing the operations part of business (2003, p. 57). Strategy basically concerns itself with improving company operations for better delivery of services. Business systems on their part are concerned with supporting critical operations in the business setting. Domenico describes business systems as a triangle and emphasizes on the importance of aligning business, organizational and systems strategies (2007, p. 58). He adds that the connections and effects of the alignment for the company cannot be overstated. Additionally, he alludes that the resulting strategic advantage is crucial for an organization’s achievement of both short and long-term goals.

According to Shelton et al, appropriate systems must be aligned with business strategy while ensuring successful integration of innovation (2006, p. 83). They add that all areas that need implementation of systems must be considered as challenges by these organizations, an approach that will lead to giving priority to business systems and their integration with business strategy. They further assert that with systems in place and with a high level of business strategy integration, businesses will overcome unique challenges by reaping outputs associated with innovation and performance e.g. customer acquisition, retention and satisfaction, value capture and research and development. After the implementation of effective systems and subsequent integration with business strategy, the outcome of such an arrangement basically defines the IT strategy.

According to Peppard & Ward, installation of business systems potentially raises the effectiveness of the business operations (2002, p. 78). He suggests a further use for systems once a complete integration has been achieved. Besides raising the effectiveness, the adopted systems’ next stage wil be focusing on developing new products and services. The systems if used optimally will enable maximum working of the business strategy to which will lead to the development of new forms of relationships. These relationships otherwise referred to as inter-enterprise cooperation will help in the growth of virtual enterprises.

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Leondes underscores the important of business systems and their integration with business strategy. According to him, increased customer demands and recognition by businesses that customer service is increasingly becoming the best plat form to attract and retain customer has given priority to business systems (2003, p. 61). Besides customer service, Leondes says that robust business performance is crucially dependent on effective business processes that can only operate optimally with the aid of business systems and their integration with business strategy.

Peppard and Ward say that once the business had put in place a dependable commercial system and full integration with business strategy has taken place, this will mark the beginning of a continuous evolution of the two aspects (2002, p. 97). According to them the plans should be refreshed regularly to minimize redundancy and a reversal of the gains that could have been made with the new systems.

Ethics

The research study will apply all research standards that are stipulated laws governing research of this nature. Singh says that besides methodology, one other factor that renders credibility to a research study is the ethics that are applied in the course of research (2007, p. 54). All participants will participate in the research voluntarily. None will be forced to participate against his/her will. Research assistants will make sure they explain in detail the purpose and method or research before actual research takes place. They will also make it clear that data collected will not be sold or used in any way beyond the limits of the study.

Research leaders will seek permission from relevant authorities before the actual study takes place.

Confidentiality of the participants will be paramount throughout the research. During data collection through interviews and questionnaire administration, no participant will be forced to give his/her name. All participants will have the option to choose to use their names or pseudo names. All participants will be under no obligation to answer all questions. They will be free to answer only questions they are comfortable with. Participants will also have the option of withdrawing at any point from the study without imposition of any penalties.

Limitations of the study

The research is unlikely to be without its limitations. Given that most businesses are not uniformly distributed all over the area of study, research assistants will have to commute over long distances to administer questionnaires and carry out interviews. There is also a possibility of some participants withdrawing from the study in the later stages or in some cases refusal to cooperate with research assistants.

Personal statement

All my life I have been fascinated by the world of business and have always had a strong desire to apply my skills and knowledge into this world. It is my belief that business helps in connecting different people with different cultural backgrounds in the entire world. Achieving goals set is a challenging venture but one that is exciting and helps people make the most out of their potential. To me, a major achievement in my life came when I attained a master’s degree, majoring in International Business at the University of Hertfordshire in the United Kingdom. It has been a good experience studying in the UK and it has definitely helped me improve my view of the world around me. I truly value my time here and the new skills I obtained that helped inspire me pursue business ideas I have always held dear.

One of my passions in life is learning about new business ideas in business strategy and support. I like studying about developments in the business support and integration of business strategy and systems to improve competitive advantage. Precisely, I have always been fascinated by the cutting edge business technologies that go beyond the usual business system solutions and help increase the ease of doing business.

It is my belief that success does not come easy and that in life one has to work hard to realize the goals set. This has been my guiding principle throughout my academic and non academic endeavors. I have a strong desire to continue with my education while I expand my knowledge further by continuing on with a PhD in business strategy and systems. I believe this area offers me the golden opportunity that I have always sought in order for me to make a difference in the world of business with systems technologies that help people.

I aspire to reach the highest level possible in this field through further education development and setting of realistic goals. My vision is to apply fresh and creative ideas into the world of business by revolutionizing certain support systems.

My future goal is to create my own company and to help give opportunities to others in the field of business. Therefore I wish to continue with my education, further explore ideas and to be the best at what I do. I belief the UK presents the best platform which I can use as a launch pad to my future success. If given the chance, I strongly believe that I will not disappoint.

Reference List

Domenico, A 2007.Information Systems: People, Organizations, Institutions, and Technologies, Springer, New York.

Joia, A 2003. IT-based management: challenges and solutions, Springer, New York.

Kothari, C 2008. Research methodology: methods and techniques, Cengage Learning, Chicago.

Leondes, T 2003. Intelligent Knowledge-Based Systems, Springer, Gaithersburg.

Peppard, J & Ward, J 2002. Strategic Planning for Information Systems, John Willey & Sons, New York.

Shelton, D. et al 2007. The Creative Enterprise: Strategy, Greenwood Publishing, Westport.

Singh, Y 2007. Research methodology: techniques and trends, Sage Publications, London.

Thompson, L 2001. Understanding corporate strategy, Thomson Learning, Melbourne.