The business transformation effects of information technology

Abstract

New information technologies can greatly impact the landscape of business and even entire industries. For some, these changes are both welcome and anticipated. For others, technology seems to cause more problems than it solves. The ability to interrelate technology and business strategy is what differentiates these two groups. Strategy, not technology, should guide the direction of the business. This thesis presents a simple set of current business frameworks for analyzing the business transformation effects of new information technologies. The analysis includes the five force method, value chain analysis, and Gary Hamel's business model. Both the five force method and the value chain analysis are from the work of Michael Porter. Next, the thesis introduces a case drawn from the Department of Public Works (DPW) in Arlington, Massachusetts. Currently, the water department in the DPW plans to install a new wireless data collection system and a new data analysis application. The new technologies allow the DPW to collect and analyze customer's meter readings more efficiently. Through the use of the above mentioned business analysis tools, this thesis explores the possible business transformation effects caused by the implementation of the new technologies. By examining the future effects, the town can make a more educated decision regarding when and how to implement the new IT systems. Also, the analysis may help to eliminate unexpected issues before they arise both during and after the implementation.