Implications of Information Technology in Developing Countries Essay Example for Free

Implications of nurture Technology in Developing Countries EssayThe survival and make up of boldnesss in an increasingly turbulent environment would depend upon telling utilization of study engineering for align the organizational structure with environmental preferences and for creating symbiotic interorganizational structures. How can IT do the organizations in responding to the ch every(prenominal)enges of an increasingly complex and doubtful environment? How can IT help the organizations achieve the on the table organization structure? These atomic number 18 the topics that re main(prenominal)s to be a number of question for many ontogeny countries. Although knowledge engineering is still a . black box . applied science for exploitation countries, it is by and large applied in industrialised countries to the disadvantage of the majority of developing countries. This paper will try to illuminate the aspects and the impact of training Technology in managing or ganizational change and its implications for developing countries.1. Introduction The rate and magnitude of change be speedyly outpacing the complex of theories. economic, social, and philosophical on which public and private decisions are based. To the extent that we continue to berth the world from the perspective of an earlier, vanishing age, we will continue to misunderstand the phylogenys surrounding the transition to an information society, be inefficient to realize the full economic and social potential of this r growingary technology, and risk making several(prenominal) really serious mistakes as reality and the theories we determination to interpret it continue to diverge..-Arthur Cordell(1987).We arrive modified our environment so radically that we must modify ourselves in order to exist in this new environment..Norbert Wiener(1957) The survival and growth of organizations in an increasingly turbulent environment would depend upon effective utilization of read ing technology for aligning the organizational structure with environmental preferences and for creating symbiotic interorganizational structures. How can IT help the organizations in responding to the challenges of an increasingly complex and uncertain environment? How can IT help the organizations achieve the .flexible. organization structure? These are the topics that remains to be a matter of question for many developing countries. This study will try to illuminate the aspects and the impact of Information Technology in managing organizational change and its implications for developing countries.2. Aspects of Information Technology Information technology (IT) whitethorn be defined as the convergence of electronics, computing, and telecommunications. It has unleashed a tidal wave of proficient innovation in the collecting, storing, processing, transmission, and presentation of information that has not only transformed the information technology sphere itself into a exceedingly dynamic and expanding field of activity creating new markets and generating new investment, income, and jobs- except also provided other sectors with more rapid and efficient mechanisms for responding to shifts in demand patterns and changes in world-wide comparative advantages, through more efficient output processes and new and alter harvest-homes and services (e.g. replacing mechanical and electromechanical components, upgrading traditional products by creating new product functions, incorporating skills and functions into equipment, automating routine work, making technical, professional, or financial services more transportable).The development of IT is intimately associated with the overwhelming advances belatedly accomplished in microelectronics. Based on scientific and technological breakthroughs in transistors, semiconductors, and integrated circuits (chips), micro-electronics is affecting any other branch of the economy, in terms of both its present and future day employment and skill demands and its future market prospects. Its mental home has resulted in a drastic fall in cost as substantially as dramatically improved technical performance both within the electronics industry and outside it (Malone and Rockart, 1993). The unvarying rise in the number of features on a single micro-electronic chip has permitted lower convention costs for electronic equipment (each chip replacing many discrete components), faster switching speeds (thus faster and more mesomorphic electronic computers), and more veritable, smaller, and lighter equipment (fewer interconnections, less(prenominal) power and material).Similar dramatic falls in costs occurred in the transport and steel industries in the nineteenth century and in energy in the twentieth, associated with the emergence of the troika and fourth Kondratiev cycles, respectively. The potential effects of microelectronics are thus very far-reaching, for its persona in performance saves on virtual ly all inputs, ranging from skilled and unskilled jab to energy, materials, andcapital. All sectors of the economy have been influenced by the development of IT applications information technology opens up greater opportunities for the exploitation of economies of scale and scope, allows the more flexible product and use of labor and equipment, promotes the world(prenominal)ization of production and markets, offers greater mobility and flexibility in capital and financial flows and services, and is frequently the status for the creation of innovative financial instruments.Information system developments are constantly creation applied to increase the productivity, quality, and efficiency of finance, banking, business heed, and public administration. In manufacturing, and to some extent in agriculture, many processes have been automate, some requiring highly flexible, self-regulating machines, or robots. The engineering industry has been transformed by computer-aided design a nd three-dimensional computerized natural covering displays. The pace of technological change in IT will most likely accelerate the already noticeable growth in the interdependence of international relations not just economic or financial, only when also political and cultural. National economies have become more susceptible to the effects of policy decisions taken at the international level, and domestic economic measures are having increased impacts on economic policies of other countries. gentleman markets for the consumption of similar goods are growing, and so are common lifestyles across national borders. The advance of telecommunications and cybernation has recently enabled large companies to use information systems to transmit technical and economic information among numerous computer systems at different geographical locations, subjecting widely dispersed industrial plants to direct managerial accommodate from a central location this affects the international division of labor and production and international trade, changing the patterns of industrial will power and control, altering the competitive standing of individual countries, and creating new trading partners. It is the desegregation of functions that confers on information technology its real economic and social significance.More than just a gradual and incremental technological evolution leading to improved ways of carrying out traditional manufacturing processes (i.e. simply the substitution of new technologies for alert systems and the rationalization of standard activities), IT offers the opportunity for completely new ways of working through systems consolidation. Rather than applying one spot of new technology to each of the production functions now performed at distinct stages of the production process, i.e. design, production, marketing, and distribution (in what could be called stand-alone improvements or island automation), having evolved in to new technologies, i.e. Enter prise Resource Planning systems, IT offers the possibility of linking design to production (e.g. through programmable manufacturing, measuring, and testing equipment responding to the codification of design), planning and design to marketing and distribution (e.g. through a assortment of computer aids and databases that sense and collect changing market trends), production to distribution (e.g. by automatically incorporating orders and commissions by customers and suppliers into the production process), etc.The complete integration of all these production subsystems in a synergistic ensemble is still more a long-term trend than a reality, but use of automated equipment to link together individual items of equipment belonging to hitherto discrete manufacturing operations has already made IT a strategic appear for industry. More technical advances are expected soon in the automation of telecommunications and the linkage of computers by data transmission that will enhance the poss ibilities of systems integration. Such programmable automation, or computer-integrated manufacturing (CIM), has the capability of integrating information processing with physical tasks performed by programmable machine tools or robots. CIM offers radical improvements in traditional problem areas confronting manufacturers, much(prenominal) as reduced lead time for existing and new products reduced inventories more accurate control over production and better quality production focusing information increased utilization of costly equipment reduced overhead costs improved and consistent quality more accurate forecasting improved delivery performance (Miles et al., 1988). These features characterize information technology as a new technological system, in which far-reaching changes in the trajectories of electronic, computer, and telecommunication technologies converge and offer a range of new technological options to virtually all branches of the economy.Moreover, IT forms the basis for a reorganization of industrial society and the core of the emerging techno-economic paradigm. The reason for the pre-eminence of the new technological system meet around information technology over the equally new technological systems clustered around new materials and biotechnology is the fact that information activities of one kind or another are a part of every activity within an industrial or commercial sector, as wellhead as in our working and domestic lives. Almost all productive activities have high information intensity (some involve little else, such as banking or education).Further more, along with the premier of meshing technology and e-business architectures powerful concepts like inventory control, supply chain management, customer relationship/service management, and management resource planning through the internet under the name of Enterprise Resource Planning have enabled IT to be capable of offering strategic improvements in the productivity and comp etitiveness of virtually any socio-economic activity. another(prenominal) than industrial or commercial sectors, information technology is also applicable in education sector and in public institutions. Thus, Information Technology is universally applicable. Probably only a fraction of the benefits derived from information technology-based innovations have so far been reaped and the rest remain to be acquired in the next decades. The shift towards systems integration to capitalize the full potential benefits of IT requires considerable adaptations, learning processes, and structural changes in existing socioeconomic institutions and organizational systems.The tradition in most current organizations is still to operate in a largely disintegrated fashion, aware of the Ford-Taylorist management approach pathes that dominated the fourth Kondratiev cycle high division of labor, increasing functional specialization/ specialism and de-skilling of many tasks, rigid manufacturing procedur es and controls, long management hierarchies with bureaucratic decision-making procedures and a mechanistic approach to performance. Under these conditions, use of IT is restricted to piecemeal technology improvements. By contrast, information technology-based systems offer organizations the opportunity of functional integration, multi-skilled staff, rapid and flexible decision-making structures with greater delegation of responsibilities and greater autonomy of operating units, a more flexible and organic approach enabling a quick adjustment to changing environmental conditions. (Piore and Sabel, 1984.)But this means that information management skills require the ability to make choices about the optimal arrangements for particular situations unlike earlier generations of technology, IT offers not a single best way of organization but a set of more or less appropriate alternative organizing, staffing, and managing options that may be adopted in different organizational contexts. Th ere is no determinism in the way information technology influences the socioinstitutional framework. Therefore, organizational innovation is a crucial part of the requirement for firms to adapt to survive (Miles, 1988). Unfortunately, this is true for all the institutions as well. Further, it is even more dramatic for the organizations in developing countries because of not being able to properly adapt to this so-called .black-box. technology. No matter how frustrating it is understand for these countries, IT still has real impact on their development.Although socio-economic structure of these countries resists organizational or institutional changes, the complex interrelations amidst these changes and information technologies have significant implications for the way IT does and will affect the societies and economies of developing countries. As a matter of fact, the negative and positive potential impacts of IT on these countries are a matter of great controversy among economis ts and politicians. The main short term issues usually discussed are the potential erosion of the comparative advantages of low labor costs, specially in relation to assembly facilities, and the effects of automation, particularly on internal markets and international competitiveness. Implications of information technology for those countries hold great importance.3. Implications for Developing Countries The first direct effect of the micro-electronics revolution was the location of production for trade in third world countries. While production of mainframe computers continued to be rally largely in industrialise countries, production of smaller computers and of microelectronic devices, more subject to price competition, was shifted to low-wage locations, primarily in East Asia, where countries presented low wage costs as well as political stability, a patrician labor force, and government incentives. Location of production for local and regional consumption followed, but the countries concerned were mainly middle income three quarters of US investment in third world micro-electronic industries was concentrated in 11 countries, namely the four Asian dragons, India, Thailand, Malaysia, the Philippines, Brazil, Mexico, and Colombia (Steward, 1991).Export-oriented investments in these countries were associated more with direct foreign investment from big firms in industrialized countries than with firms producing for the local market on the other hand, licensing was more associated with smaller firms (Tigre, 1995). The automation of production decreases the relative importance of labor-intensive manufacturing and cost of labor, thereby eroding the competitiveness of low labor costs. For instance, automation led to a sharp decrease in the difference mingled with manufacturing costs of electronic devices between the United States and Hong Kong in manual processes, manufacturing costs were three times higher in the United States, and the introduction of sem i-automatic processes made the difference practically disappear (Sagasti, 1994). Equally, the expansion of automation in Japan has contributed to a step-down of Japanese investments in the Asia/Pacific region involving firms in electronics, assembly parts, and textiles (Sagasti, 1994).The trend to increasing systems optimization and integration is most likely to induce large producers in industrialized countries to bring back a significant share of their production located in developing countries (offshore production). This movement has been called comparative advantage reversal. As integration increases, with functions previously obtained by assembling pieces being incorporated in the electronic components, value-added is pushed out of assembly processes into the components themselves and up towards servicing. In addition, the growing technological complexity of electronic devices increases the value of the parts manufactured by firms located in industrialized countries The centr e of value-added obtained in offshore assembly has thus been constantly decreasing (Sagasti,1994). ball-shaped factories constructed in locations of least(prenominal) cost, often at a considerable distance from final markets, were economically worthy because labor was one of the major determinants of costs. Technology and rapid responsiveness to volatile local markets are beseeming more important components of competitiveness. The reduction of product cycles due to the growing resistance to obsolescence of programmable machines and equipment has led to a concentration of manufacturing investment in capital-intensive flexible manufacturing, further adding to the erosion of the comparative advantages of developing countries. The assembly of systems will likely continue in some developing countries that have adopted protective legislation for local production targeted at particular market segments (e.g. Brazil), although this is changing very rapidly (Steward, 1991).The types of e quipment produced under these circumstances are utilize largely in internal markets and are hardly competitive on the international level they operate to be far more expensive than comparable equipment available abroad, and often their installation and use are also more costly because of expensive auxiliary installations, under-use, and lack of management skills. Nevertheless, they may at least provide the country with the capacity to follow the development of information technologies more closely. In other countries, assembly of equipment is taking place from components bought practically off the shelf, but as the level of hardware integration and the amount of software incorporated into the chips (firmware) grow, valueadded will be taken away from the assembly process, reducing or eliminating its economic advantages.The introduction of microelectronics requires certain new skills of design, maintenance, and management, as well as complementary infrastructural facilities such as reliable telephone systems and power supplies. Deficiencies in these factors prevent the widespread adoption of information technology in developing countries (Munasinghe et al., 1985). The more advanced developing countries, with a wider basis of skills and infrastructure and a more flexible labor force, may be in a better position to adopt IT and to increase their productivity and their international competitiveness. But the less developed countries, with inadequate skills and infrastructure, low labor productivity, and lack of capital resources, will find it difficult to adopt the new technologies they are likely to suffer a deterioration in international competitiveness vis--vis both industrialized and the more advanced developing countries (Stewart et al., 1991).Quality, too, requires an adequate level of skills, infrastructure, and managerial know-how that is for the most part lacking in developing countries. This greatly reduces the synergies, number of options, faster respo nses, and more informed decisions that can be implemented in the firm by the optimization of the systems performance. In turn, the composition of the labor force existing within firms located in industrialized countries will further improve their systems performance and further reinforce the advantages derived from automation. The proportion of the labor force employed in production is constantly decreasing in the industrialized countries, implying that performances at the systems level and innovation, not manufacturing, are becoming the key to profit, growth, and survival (Sagasti, 1994).Like biotechnology, information technology is a proprietary technology, vital technical information regarding design engineering specification, process know-how, testing procedures, etc., being covered by patents or procures or closely held as trade secrets within various electronic firms from industrialized countries. Many companies in the software area do not patent or copyright their products b ecause it entails disclosing valuable information, and firms are generally reluctant to license the more recent and advanced technologies. Therefore, technology beam takes place mainly among established or important producers, hindering the access to developing countries. Moreover, the main issue facing developing countries is not so much the access to a particular technology but to the process of technological change, because of the dynamism of this process. Sagasti implies this issue in the book The Uncertain Guest science, technology and development (1994) that recent trends in inter-firm relationships seem to indicate that this access takes place essentially through the participation in the equity of the company holding the technology.