Question

Use Michael Porter’s Value Chain to describe how an organization should spend its information technology budget

Answer 1

In the value chain of Micheal porter, The technology development is one of the element in supporting activities which tells us about an organization's technology infrastructure and how it create value to an organization. Technology has become very valuable and integral part of every organization because it helps them to perform business activities in less time and at low cost.

An organization should spend its IT budget on the activities that relate to managing and processing information, as well as protecting a company's knowledge base. Minimizing information technology costs, staying current with technological advances, and maintaining technical excellence are sources of value creation.

for example- if There is new technology in the market which can help An manufacturing organization to make more products at less time and at less cost as compared to current tech in the organization then management should take decision to spend budget on purchasing that tech.

The spending of budget on updated technology helps to improve efficiency and effectiveness of performance of an organization and its employees also increase profit of business.