It and Competitive Differance

MAN 6830 – IT and the Competitive Difference – Alejandro Otero

Write a one page summary of how you think the company justified the technology investment to the shareholders and board before the project. a. Give examples of what you think they should have used.

I think the way the company justified the technology investment to the shareholders and board before the project was based on future projections. It always comes down to the cost of the development project and benefits it will have in the near future. CISCO shareholders have to look at the benefit of financing new technology to advance their overall production. Back in the 1990’s CISCO gave birth to a system called ERP. This ERP system allowed the whole company to have instant communication throughout the whole organization. Since CISCO had already been the frontrunners of new technology, the enactment of the ERP system was right up their alley. Organizations overall have to look at the funding opportunity to integrate new technology with their current technology to have more opportunities to expand their business practices. CISCO IT department currently had survey programs that were being used currently. However, the investment practices in the new technology were to create efficient processes and organizational streamlining. This in part was to make the organization more competitive. Since new technology has to integrate with current technology, the mass roll out had to re-design its existing format with a high budget. Since the shareholders have the last word, it needed to be approved by them first. Since customer’s networks were running at a faster pace, shareholders new they had to approve the additional financing to allow new technology to be implemented into CISCO. Automation had to take over CISCO old technology system. To ensure that CISCO is operating its finances to know that affordability of introducing new technology to the organization, they should have turned to EVA. By understanding and calculating the net operating profits after taxes and deducting the charges for the capital that is used to produce those profits, EVA could have informed them more specifically on investing in the new technology. The example I feel that should have been taken was to integrate the system into one database. Since they have been working with fifteen different databases, consolidating all of them into one would have been more cost effective and more efficient.