Question

Question 3 (, 10 lines max.): Explain why today it is important for a manager to understand the issues related to information systems and digital transformation. You can illustrate your answer with examples.

Answer 1

Answer:

In today’s competitive markets and the challenging global technological developments, it is very much important for a manager to understand the issues related to information systems and digital transformation.

Information system helps an organisation to control their key business processes through a formal and socio technological system designed to collect, organise, process and distribute the various information and data of the organisation to its key stakeholders.

Digital transformation is the fast and frequent use of the digital technologies to create new business processes and customer experience to meet the changing business and market requirements.

Managers should understand the following issues associated with the information system and the digital transformation:

1. Information system is the software or a group of software that stores plenty of data and converts this data into the meaningful information. However, the confidentiality of the data and handling a very large amount of data is becoming a serious concern for the organisations. Loss of these data may cost huge amounts to the organisation. Managers are required to have a close look on this data and should control the flow of data under high security.

2. The information obtained from the information system act as a support system for digital transformation. This information is used for making the key business decisions for modifying the key business processes, culture and the customer experiences to satisfy the needs of the market. It becomes the responsibility of the business managers to understand the validity of the data and the various key business processes where it can be applied. Formal forecasting for the application of the digital transformation and its impact on the business processes and the culture of the business and the external environment should be conducted by the managers to measure the validity of the data on the key business processes.

We can consider the example of the retail sector which has undergone a huge business transformation over several years and has led to the changes in the key business areas such as the increase in sales, low operational cost and high inventory turnover rate. The use of information system such as the use of big data and the artificial intelligence has proved to be significant in the digital transformation of the retail business.