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Strategic Decision Making In A Textile Company Information Technology Essay

Paper Type: Free Essay Subject: Information Technology
Wordcount: 4398 words Published: 1st Jan 2015

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The textile and apparel industry stands out prominently as one of the most globalized industries in the world today. It is different from producer driven supply chains led by multinational companies. The apparel industry is a Buyer-driven commodity chain led by a coalition of retailers, contractors, subcontractors, merchandisers, buyers, and suppliers. Each participating entity plays a role in a network of supply chains which span from fibers, to yarn, to fabrics, to accessories, to garments, to trading and marketing. Geographically, they span multi-continents and crosses regional and national boundaries. With the reducing profit margin and impact of modern computing communication networks, it is essential that any textile and apparel industry seriously consider establishing a cost effective IT infrastructure to maintain their competitive edge.

Research will be carried out in small and medium scale apparel industries. The study of the research will be to identify;

What information they require when making decisions

The use of IT and IS when making decisions

Recommendation of suitable IT infrastructure

1.3 Project Aim

As the manufacturing industry becomes more globalized, the multi-factory supply-chain model has emerged. When several production lines are producing different products on one supply chain, it could generate loads of information and data to be exchanged, supplied and received. The garment-manufacturing industry always aims for new product development and efficiency improvement in production. In past years, advanced computer technologies already facilitate new manufacturing operation and build up management tools. Today’s manufacturers are looking towards more advances and benefits with their focuses shifted to many different types of networking tools. These tools do enable them to seek better opportunities on more complicated areas working with RFID like inventory control and supply-chain management, as well as the B2B e-commerce transactions. However, while employing this latest technology, manufacturers are facing a long-standing problem – how the new technologies and systems can bring better coverage and practicality to the running of the companies.

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1.4 Project Objectives

The objectives of this project are in two folds notably research and experimental objectives. The research objectives focus on the identification of relevant techniques and knowledge that could possibly emerge during the conduct of this project. On the other hand the experimental objectives deal with specific processes, software or other materials including simulation models and programming codes that may be constructed to facilitate the smooth conduct of this project. Research will be carried out study how IT and IS supports to all the levels of decision making and the tools which is used by the companies. By identify what type of decisions and what information they represent suggest the use of certain analytical tools to enhance support measures for decisions in apparel industry. Techniques from operations research are applied to develop profit optimization and cost minimization models. Statistics and accounting methods are used for comparing costs of sourcing collaborations, and basic math is used in cost estimates.

The overall main and core research questions of this study is to analyze how the IS and IT influences the apparel trade when making decisions. More specifically, what are the pros and cons in tools and how that influences the apparel decision making process?

In order to carry out the research further the main research question will be :

“What is the impact of IS and IT on strategic decision in an organisation using a textile company as a case study?”

Below are the objectives of this work.

What are the strategic decisions

What are the strategic decisions in Textile Company

What are the factors which impact strategic decision

What are the features of information required in strategic decisions

How has IS/IT influenced strategic decision in the organisation under study

What are future recommendation to use IS/IT to benefit strategic decision in textile organisation

1.3 Rationale Of Study

Rationale of the study will be carried out to offers combination of fast growing IT & IS which provides higher level of visibility and control to make decisions. For fashion professionals with a more usage-oriented approach, attempt to demonstrate the usefulness of available analytical and mathematical tools, which could benefit profits and support sourcing decisions. Most of the apparel companies devoted a huge amount of effort on decision making process using IT to improve efficiency. Information System (IS) and Information technology (IT) can be eventually lead to the development and creation of any kind of decision making and enhances the decision effectiveness in industry, using the data to decision model as a basis. In many respects, economy of any country in the world has been coordinated by the visible hand of the government decisions. The world economy is becoming a borderless one, which directly affects the economy of any country driving it into an open economy. The rising cost of production factors, wage rates, interest rates, GDP, inflation rate, etc stalls economic growth. Both public and private sectors are looking for ways to maintain their competitive edge by improving economic efficiency, and one of those efforts is the use of Information Technology and Information Systems. They are making an utmost effort to build the information-communication infrastructure, and promoting to explore new business opportunities using IS and IT.

Identify threats and opportunities:

Chapter 2

Literature Review

Introduction to the CASE study:

The textile /apparel pipeline is a series of interrelates activities which originates with the manufacture of fiber and culminates in the delivery of a product into the hands of the consumer.

Information Technology (IT):

In the 1960s and 1970s, the term information technology (IT) was a little known phrase that was used by those who worked in places like banks and hospitals to describe the processes they used to store information. With the paradigm shift to computing technology and “paperless” workplaces, information technology has come to be a household phrase. It defines an industry that uses computers, networking, software programming, and other equipment and processes to store, process, retrieve, transmit, and protect information.

Information Systems (IS):

The largest growth in most economies is coming from ‘information’ industries. The success of such knowledge-based organizations lies in their information systems. Also, forced by technological change and globalization of markets, many manufacturing industries are also placing increasing emphasis upon information systems. Information systems are more than just computer programs. Though information and communications technologies are playing an increasing role in meeting organizations’ information needs, an information system is a much more general concept. It refers to the wider systems of people, data and activities, both computer-based and manual, that effectively gather, process, store and disseminates organizations’ information.

Information systems, as a discipline, focus on exploring the interface between management, information science and computer science. Computer Science focuses on information technology: software. Information Systems mediates the two opposing worlds of human activity systems and information technology.

Strategic Decisions :

In most businesses, a few decisions make the difference between superior performance and ordinary results. But strategic decisions are seldom easy. They call for high quality analysis and strategic thinking, in order to select the right decision from amongst the many possible options. They also depend on skills in managing the decision process, including sequencing activities, defining roles, effective teamwork and handling the people side. This practical and highly interactive programme will help you improve the quality of your strategic decision making, providing practical tools for addressing both the analytic and process management challenges.

Strategic decision address the business of today and the future, not only markets and decision making but also social developments, implications of strategy on the organizational structure and climate (Hussey,1990). Examples of strategic decision problems can be found in the areas of marketing, pricing, investment, financing, production changes, production technology, etc..

Information systems are tools to assist executives in strategic management (Liu and Savolainen, 1994a-c, Partanen and Savolainen,1995,Walden,1992). They offer analytical facilities to assist in clarifying complex problems in behavioral thinking, competitor and enviormental analysis , value chains and performance ,etc.,

Strategic decisions should be well planned and well controlled. Strategic planning is a complex decision – making process for the corporation that includes planning and modifying of organizational objectives, resources for implementing them and utilization of the resources (Ansoff ad McDonnell, 1990)

Strategic decisions can be classified as

Structured decisions :

Semi- structured decisions :

Unstructured decisions :

Impact of IS and IT in Strategic Decisions :

From new business models to new types of business, information technology has become a key driver of business and an essential component of corporate strategy. But simply acquiring technology is not enough; organizations must manage IT effectively to gain the competitive advantage.

Henry Lucas’s Information Technology: Strategic Decision Making for Managers focuses on the key knowledge and skills you need to take an active role in managing technology and obtain the maximum benefits from investing in IT. Offering streamlined, up-to-date coverage, the text is ideally suited for MBA students or anyone who wants to learn more about how to gain the competitive advantage by successfully managing IT.

Focuses on managerial issues: This text explores the many real technology issues confronting today’s managers, such as what to do with legacy systems, when to outsource, and how to choose a source of processing and services.

Shows how to evaluate IT investments: Two full chapters cover the value of information technology and how to evaluate IT project proposals using both net present value and real options approaches.

Balances technical and managerial coverage: This balance helps you understand how diverse companies have developed their IT architectures and environments.

Explains the various applications of technology: Concrete examples illustrate major IT applications, such as ecommerce, ERP, CRM, decision and intelligent systems, and knowledge management.

Problems in which the stakes are extremely high, in which human perceptions and judgments are involved, and whose solutions have long-term repercussions, call for a rational approach to their solution. Various techniques are in use for decision making at the strategic level. However, at this level the problems are ill defined are usually presents in terms that are uncertain, fuzzy and confusing, while problem-solving techniques based on sound mathematical principles can only be applied to systematic and well-formed problems. This mismatch between problems and their solution methods leads to the frustration of top decision makers and their loss of confidence inn mathematical techniques.

In today’s highly uncertain world making a decision which has long term implications requires a thorough understanding of likely or possible future situations and also the ability to balance a large number of controllable and uncontrollable parameters. However, the time now given to decision makers to reach high risk long term decision is decreasing.

The economic structure of an industry is not an accident. Its complexities are the result of long-term social trends and economic forces. But its effects on you as a business manager are immediate because it determines the competitive rules and strategic decisions which make. Learning about that structure will provide essential insight for your business strategy and it will help to make decisions.

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Every aspect of management in the modern age relies heavily on information and technology to succeed. It is an important reserve needed to develop assets. Strategic Decision making and planning has been a topic of considerable importance and interest to Information System professionals in both the business and academic communities since the 1970’s. Decision making and planning is recognized as a critical competitiveness issue. Today, because information systems (IS) and information technology (IT) serve as the driver of many organizational transformations, there is increased pressure on organizations to leverage their investments in technology and information systems. Success usually occurs when an organization is able to achieve congruence between IS and IT with organizational decision making and planning, and this is achieved when the technical and general managers of an organization work collaboratively. The strategic decision making and planning process is intended to ensure that technology activities are properly aligned with the evolving needs and strategies of the organization. This paper will examine the research on this ever-important topic and suggest a process that will assist in the achievement of decision making and planning success.

Over the years, many organizations have made technology decisions and acquisitions that impact organizational information systems (IS) on the basis of what they believe or recommendations from vendors or colleagues from other organizations. The end result of this approach toward decision making and expenditure of funds has been quite unpredictable. The pervasive nature of IS & IT in today’s organizations coupled with increased pressure to leverage technology assets has dramatically increased the importance of strategic information systems planning (Bechor, Neuman, Zviran and Glezer, 2009). Today, most organizations insist that technology and IS related decisions be made with a clear understanding of business and organization strategy and direction.

Hoque, Sambamurthy, Zmud, Trainer, and Wilson, (2005) in Winning the 3 Legged Race define alignment as “the situation in which a company’s current and emerging business strategy is enabled, supported and unconstrained by technology.” Piccoli (2008, p. 155) states that organizations “achieve a high degree of fit and consonance between priorities and activities of the IS function and the strategic direction of the firm” when they are able to achieve this so called strategic alignment. Alignment has become one of the top issues and concerns of IS management executives (Gutierrez, Orozco, and Serrano, 2009).

A framework that helps to clarify the importance of information systems in today’s organizations is the Information Systems Strategy Triangle. The message conveyed by the triangle is that it is – important for the three elements of the triangle, namely Business, Organizational and Information Systems strategies to align with and complement each other. It is important to note that Business Strategy resides at the top of the triangle. The triangle is depicted as follows (Pearlson and Saunders, 2010, p.23).

There are no shortcuts to the strategic decision making process. Preparatory steps that ensure that business, organizational and information systems and technology used are aligned in a complementary fashion, are extremely important. Internal and external assessments need to be addressed, and the overall role of technology and information systems within the organization must be determined. A sense of how much should be spent on technology initiatives is also mandated. The most important point to remember is that the decision making process for technology must be part of the overall business plan.

Practically speaking, strategy states the direction we want to go and how we intend to get there, and a plan depicts a view of the future that guides current day decision making (McNurlin, Sprague, and Bui, 2009). Organizations need to develop a strategic planning process in order to provide a context for decision making.

Deciding on the type of tools to use in the decision making process is neither straightforward nor simple. The process is complex, there is not a single best approach, and arriving at a single best methodology for a specific organization is nearly impossible. As a result, many organizations utilize a combination of approaches.

Decision making using information systems and technology was previously the work of technology and systems professionals. It has now changed to be a collaborative planning challenge of parties including top managers, business unit managers, technology and systems professionals, and sometimes external stakeholders such as customers and alliance partners (Ruohonen, 1996).

Thus, planning and decision making becomes a partnership among those with technical skills, the information systems group, and the general and functional managers of the organization. This process requires discussion, clarification, negotiation and the achievement of a mutual understanding (Piccoli, 2008; McNurlin, et al., 2009).

With today’s rapidly evolving technology advances, along with the somewhat unpredictable emergence of new competitors brought about by the Internet, organizations do not have a year to develop a plan, several years to implement the plan, and a three to five year useful life for the decision making plan. Everything that is technology-related moves at a rapid pace and change is inherent in the adoption of new technology and ISs. Due to the rapidly changing technology environment, many feel that a “sense and respond” approach to planning is appropriate. When apparent opportunities appear, organizations need to respond quickly in order to take advantage (McNurlin, et al., 2009). Some rapid responses may be viewed later as failed experiments, but that may prove to be better than a lost opportunity.

In the preliminary planning preparation, those responsible for the planning process must decide which combination, if any, of the above planning techniques to employ as the process is designed. Generally as methodologies are developed, four elements for consideration emerge. They include an opinion of what needs to be solved, defined techniques on what has to be doneand when to do it, advice on how to manage the quality of deliverables, and a tool kit to facilitate process (Ishak and Alias, 2005).

Most processes also include a situation analysis in the form of Strengths, Weaknesses, Opportunities and Threats (SWOT). This analysis addresses the organization’s internal and external influences, strategy formulation, and specific goals along with tactical and operational plans for achieving the goals (Semiawan and Middleton, 1999).

Technology and information systems play an ever-increasing role in today’s organizational environment. Because of the rapidly changing nature of technology developments, it is sometimes difficult to employ standard planning processes. The primary guideline for information systems planning is that the planning process must be designed and conducted in alignment with organizational and business plans. Most organizations now agree that IS is an important strategic organizational resource that can provide strategic advantage and boost business performance (Brown, 2004). As part of their plan, many organizations have adopted a sense and respond position with regard to opportunities that may present themselves. Often, a scenario development approach that looks to possible future developments is essential to help combat the rapid rate of technology change.

There are multiple planning tools available for the strategic information systems planning process. Choosing the tools that meet the needs of the organization and lend focus to the desired areas of emphasis is critical.

Finally, organizations should consider the introduction of technology-driven approaches to planning to help with speed, efficiency, flexibility and communications.

2.1 Preliminary Literature Review:

For the past 15 years, many apparel companies have been actively monitoring their supply chains. Throughout, the majority has looked to factory owners and managers to wants to make decisions to changes in factory conditions and operations to comply with local laws and meet brand compliance requirements. To meet requirements, demands were placed on suppliers to increase wages, minimize excessive overtime hours, secure freedom of association, and improve health and safety systems for workers. Simultaneously, brands were dictating lower and lower prices for products. Increasing demand for products at lower prices frequently prevents suppliers from having the resources necessary to abide by the standards laid out in codes of conduct.

Information Engineering is a technique for extracting the “meaning” contained in information that is needed by a user to make a “right” decision. Information is the raw material of human thinking, but it is the “meaning and understanding” that is the raw material of decision thinking, and the human decision maker acquires this meaning and understanding from the “message content” of the information. The process by which raw data is translated into decisions is depicted in the Data-to-Decision Cycle model . This low information utilization occurs because the user does not have enough diagnostic time to acquire the vital information buried in the report. Therefore, the goal should be to optimize the quality of the messages transmitted through the interface from the information system to the human user. Information Engineering assists in this process.

Chapter 3

3.1 Methodology:

For the purposes of conducting this project, the quantitative methodology was adopted as it had stronger ties with the aims and objectives of this work compared to the other types such as the qualitative and ethnographic methodologies. With the quantitative methodology several quantities may need to be measured, analyzed and results presented as evidence to justify any conclusions that may be drawn. This contrasts with qualitative methodology which focuses on subjective matters like behavior and perception. It is however acknowledged that minor elements involving qualitative analysis such as observations may also need to be made to be made occasionally to help advance an argument. Other, two research approaches notably, descriptive and analytical approaches would be used in conjunction with the quantitative methodology to execute this project. The descriptive approach would be employed to help describe the usage of IT & IS and how it is important to the strategic decisions making whiles the analytical approach would be useful in analyzing all secondary data collected for the purposes of this work as well as help to assess experimental outcomes.

3.2 Primary Research:

Primary research is used to collect data for the case study. Types of primary data collection methods include:

Qualitative research : There are four major methods used by qualitative researches such as observation, analyzing text and documents, interview and focus groups

Quantitative research : Major quantitative research methods are using literature, using technology and statistics

3.3 Secondary Research:

Secondary research was carried out to gather information of existing data  as well as evaluate and integrate the information from the various sources in order to answer specific research questions. During the secondary research will be looking forward to gather information about advertising and brands in books and periodicals by using library resources. Case studies will be used for gather additional information such as pros & cons about the research topic .Case studies included the aims and objectives of several advertisements and a general critic of their design. Since case studies demonstrate examples from the real world, it will help to improve the deep understanding and analysis on real situations.

3.4 Data Collection:

DZ Group Ltd, is an independent medium scale apparel garment which is based in London – South Gate which is established in 1980’s. The case study has been conducted in aid of said company. Prior to the initiation of the project following methods has been used for data collection..

Interviews : an interview was carried out by the author with the contact person at the sponsor company. Interviews are highly formalized and structured using standard questioners. The interviews were carried out as

Structured interviews: used standard specified questioners and refer to each individual participant. This interview was documented and provided pertinent information used in the development of the Terms of Reference for the project.

Semi structures interview: used standard specified questioners and additional questions has been asked of individual participants.

Questionnaires or Surveys : A questionnaire is an enquiry tool that consists of a series of standard questions used for the purpose of gathering useful information from individual participant.


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