Technology tools are implemented in a company to improve operational efficiency. These can also help enhance an existing competitive advantage that an enterprise has vis-a-vis its competitors.
Most organizations, therefore, introduce new technologies to achieve the objectives mentioned above. Technology tools, on their own, do not help an enterprise achieve a competitive advantage. Most IT services companies, though, market technology solutions that will help transform a company’s operations. Tools only improve operational efficiency; the foundational competitive advantage is a consequence of strategy and business models.
Flagging productivity, the need to streamline operations, reduce overheads, and staffing costs are other factors that determine technology implementation decisions.
Let me try and explain the confusion between IT transformation and competitive advantage that has been caused by IT services marketers. A decision, for instance, to enter a new market is a strategic decision. Bringing a new model or product is another example of a strategy-driven decision. Using a technology tool to streamline the operations that will facilitate the implementation of strategic choices are examples of IT transformation.
The company’s objectives, therefore, drive the choice of inducting a new technology solution into an enterprise. Do not get carried away by the marketing hype; look at your underlying need. If you do that, you will make the right decisions.