• Uncategorized

Information technology strategic plan

INFORMATION TECHNOLOGY STRATEGIC PLAN 1

Name of student

Institution affiliation

Abstract

Information Technology services are anecessity in the modern era if a company seeks to gain a competitiveadvantage over competitors. For any organization implementing anInformation Technology venture or solution, the implementation mustbe managed carefully. The Information Technology Strategic Plan is amanagement work plan that shows how and why the IT solution is beingintegrated into the firm. The Information Technology Strategic Planensures a firm reaps the maximum benefits from an IT investment. Thispaper takes a look at an America airline Southwest airline. Thestudy will look into the airline`s past operations and its currentoperation and analyze the trend. The airline has had a reduction inrevenue, and this study aims at returning the company to maximumprofitability. The paper researches on various aspects of the firmand the possible IT solutions available to the enterprise. The studyalso looks at IT strategic plans suitable for the implementation ofthese solutions. The study will then recommend a plan and a set ofactions the airline can take to increase revenue.

SouthwestAirlines was established in 1967 and trades on the NYSE as LUV. Theairline started off as a low-cost airline carrier in the USA.Southwest airline is currently the largest domestic carrier in theUnited States of America. The airline transported around 106 millionpassengers in the previous year. Southwest in an aim to expandacquired AirTran Airlines in May of 2011. The company takes up annualrevenue of $15 billion. The revenue collected is a large amount, butthe managers believe the airline is capable of achieving even more.

The company was in incorporated by Rollin Kingand Herb Kelleher in Texas on March 15 of 1967 as Air Southwest.Later the same year the company expanded to serve Dallas, Houston,and San Antonio. The airline from that time went on to apply and gainpermission to serve more airlines and now serves virtually all partsof USA. In 2005 the airline signed a cost sharing agreement with ATAairline expanding the airline`s network. In 2008, however, ATAairline filed for bankruptcy. Southwest Airline went ahead topurchase ATA airline`s assets and operating certificate. The airlinein 2011 February combined operations with AirTran Holdings Inc andhad since continued to expand and make a profitable business. Thisstudy intends to look into Southwest airline operations and identifyprocesses that could be improved with the help of informationtechnology. IT services and software makes previously labor intensivework easier and cheaper to perform. The software also makes worksimpler and faster to complete. Due to these factors, the demand forIT has increased drastically (Ward &amp Peppard, 2016).

Aims and Objectives

The goalof this study is to look into the Southwest airline operations andrevenues. The study will then examine the available IT strategicplans that exist and settle on the most suitable IT strategy forSouthwest airline. The study will look at the operations of Southwestairline that could benefit from IT integration. The research willthen provide recommendations for the airline to adopt.

Objectives

1. To set a clear background by conducting adetailed literature review.

2. Conduct an analysis of Southwest Airlinesfrom the operations to the revenue earned. The paper will also lookat the historical performance of the airline.

3. To conduct a SWOT analysis of theSouthwest airline.

4. To investigate all the different ITsolutions in the market and their applicability to improving the aircarrier`s operations while increasing its revenue.

Information Technology and Growth

The top growth driver in all businessesglobally is innovation. Innovation in the contemporary world isalmost synonymous with information technology. Organizations requireto innovate and implement the innovations at a low cost to gain acompetitive advantage in any sector. In a survey conducted by PWC in2011, 70% of the CEOs were interested in information technology andbelieved it was the key to gaining an advantage in the market(Cassidy, 2016).

Current situation

Southwest Airlines has been a profit-makingentity from the inception of the company. The company is stillprofitable though the income had reduced significantly. In 2010 theairline made super profits with a revenue of $459. In 2011 the incomehad dropped by more than half to $178 million with the price of fuelbeing listed as the primary contributor to the reduced revenue. Theairline`s revenue has since dropped to a level management is worriedand requires a strategy to increase revenue

SWOT analysis for the business venture

fig 1: displays the division of the SWOTanalysis.

Strengths

The airline has always had one of its strengthin being a low-cost airline. This attracts clients looking to spendless on travel. Another strength is that the company operates onpoint-to-point routes. To improve reliability and reduce time spendthe airline uses secondary airports in the main cities which are lesscrowded.

Weakness

Southwest is faced with the problem ofexpanding too fast. The challenge with growing too fast ismaintaining high quality and managing all routes and staff. In 2010the airline`s on-time arrivals were less than 80%. Mergers andacquisitions of other airlines have also seen the airline growtremendously and acquire pilots and staff from differentassociations. It might become a challenge to integrate all theseworkers into one system. The management of large assets and humanresource is a challenge for Southwest airline.

Opportunities

With the rapid growth, the airline hasexperienced, and various assets gained the airline can perform morecomplex operations. The airline is well placed to venture into theinternational market making flights to Mexico, Cuba, and other closeinternational destinations. The airline can also raise income byinstalling Wi-Fi connectivity in their flights. Flights with Wi-Ficonnectivity could be charged slightly less.

Threats

A highly competitive industry such as theAmerican airline industry is filled with threats to the business. Newairlines are springing up and increasing competition and otherestablished airlines are expanding. The airline has to grow annuallyto keep up with the competition. Operation costs at the airline havealso been on the rise in the past few years. This means the airlinerequires to reduce these costs operation costs are recurrent, andincreased operation costs could fly the airline to ruins. Highmaintenance costs could mean an increase in prices, and this wouldlead to a reduction in market share. New regulations andenvironmental requirements in the industry could force the airline toraise prices. Financial instability in the global economy could alsospell doom for the airline as it would mean reduced number oftravelers by air.

Types of I.T Investment

The world has embraced IT, and this has madeit possible for there to be different types of IT investments offeredby different firms in different parts of the world. There are reasonsthat have forced many companies to embrace information technology.Before a company come up with the best IT investment to embrace theresome factors that must be considered. One of the factors include thecost of the IT investment it is avoided unless otherwise. There ITinvestments that help firms in storing the data safely and this iswhere things like cloud computing. The type of IT investment whereany firm embracing it is relived the cost have to install machinesfor storing data where the company is offering the service stores thedata in clouds. There other types of IT investment where companiesoffer services like CCTV cameras that help in securing the premisesof any given business enterprise. I.T investment comprises of thelabor to be used with a particular information technology system.

Information Technology strategic plan

A strategic plan in Information Technology isa well thought out route a company will follow to archive the maximumfrom an IT investment. The strategic plan also ensures the costs ofimplementation are substantially reduced to maximize profits. ITstrategies are an important part of IT management (Cassidy, 2016).

Positive organizational impacts ofimplementing the strategic plan

There are numerous benefits associated withinformation technology investments. One of the benefits is thatindividuals or companies that invest in IT enjoy greater profits fromfaster operations and efficiency brought by Information Technology.Information Technology Strategic plans are aimed at ensuring smoothimplementation and maintenance of any Information Technology system.The Information Technology strategic plan lays out the roadmap forthe application an information system. A road map is necessary sothat both managers and staff know the way forward. A strategic planensures that all members of the organization are on the same page andwork in sync towards one aim.

Information technology has seen many companiesimprove and gain a competitive edge over competitors. Two firms caninvest in the same IT solution and while one might benefit from thesystem the other might discover even more challenges. The differencebetween the two would be IT strategy. An Information Technologystrategy ensures even before a system is installed that it isrequired and if well installed will make work easier. The IT strategyensures many neglected but important factors such as staff trainingis performed. The IT policy basically ensures a firm receives valuefor money in any IT investment. The strategy also ensures the mostsuitable solution is what is acquired and used (Cassidy, 2016).

Goals for the IT Strategic Plan

Management usually sets out some objectivesthat are observed when implementing an IT investment. The investorwill consider some factors like consumer tastes and preferences. Thatwill make it possible for investors to maximize profits because itwill be possible to offer services that meet customer specifications.Business organizations will be willing to spend their money onprograms that are a bit economical. Cost-benefits analysis will be afactor to be considered by almost every customer. When evaluating thebest IT investment to embrace it is good to check on how the ITinvestment will improve its productivity. However, this is a factorthat will enhance any business enterprise to ensure growth inproduction, and when such decisions are made well, such a firm willbe able to maximize sales and profit. IT managers should come upwith programs that will assure them profit realizations. ITinvestment managers should be able to show the returns they realizeafter choosing a given IT solution. Every IT investment put in placeshould be complying with any laws set because such investmentsviolate the law it might not be easy for such investments to last forlong (Galliers &amp Leidner, 2014).

Ways of conducting decision making in ITinvestment

As the process of decision making is ongoingit is paramount that all factors that might affect the investment tobe undertaken. The same principle applies when it comes to ITinvestment any decision made should be affecting the organizationpositively. Decision making is one of the most significant processesin any business. Good decisions lead to good outcomes as long as theimplementation is accurate and efficient. During the decision-makingprocess, IT managers will be torn in between a variety ofalternatives and choose the best will not be easy. Strategic planningwill be the best guideline to the IT managers because it talks moreabout where the company intends to be. Moreover, this means managerswill only make decisions that rhyme with the strategic plan of theorganization. The strategic plan will require the IT managers to comeup with strategic decisions that will set the course of the firm. TheIT managers will at the same time embrace tactical decision for thesetypes of decisions gives more light on how things should be done.While making decisions there some factors that will be put intoconsiderations by the managers. Some of the factors include inherentchallenges faced by other firms who tried or embraced IT investments.That will make it possible for the IT managers to come up with thebest decision. The other factor to be considered by the managersduring the decision-making process will be things like thecomplexities associated with the change to be brought to the firm.However, it may require that more staff may be required to take careof the change, and this will increase the operating cost of theorganization a factor that in turn may affect profit generation. Atall times, the IT managers must make sure that their decisions mustbe aimed at reducing the cost of operating for this will enhanceprofit maximization process. At the same time, the IT managers mustcome up with the most efficient decision for this will promote thegrowth of the company. Decision-making process will be the factor todetermine the future of the IT investments, and this is the reasondecision made must be inclusive of all basic requirements (Galliers &ampLeidner, 2014).

Conclusion

Southwest airline has great potential for moregrowth and expansion. The airline can also return to making morerevenue than it is at the moment. Southwest can take advantage offuel technology, information technology solutions and increasedcapacity to increase revenue. Information technology providessouthwest a platform to catapult itself to the next level. This isonly possible if Southwest airline formulates and follows the the management decides on.Information technology strategic Plans are the next frontier inmanagement since IT has become an essential part of businessirrespective of the sector or industry.

References

Ward, J., &amp Peppard, J. (2016). TheStrategic Management of Information Systems: Building a DigitalStrategy. John Wiley &amp Sons.

Cassidy, A. (2016). Apractical guide to information systems strategic planning.CRC press.

Galliers, R. D., &amp Leidner, D. E. (2014).Strategic information management:challenges and strategies in managing information systems.Routledge.