World Applied
Sciences Journal 12 (7): 1100-1106, 2011 ISSN 1818-4952 © IDOSI Publications,
Information Technology – Its Impact on Global Management

Irfan Ahmed, 1Akmal Shahzad Qadri, 2Rana Khurram Shahzad and 3Bashir Ahmed
Khilji 1


Iqra University, 5, Khayaban-e-Johar, H-9, Islamabad-44000, Pakistan Netsolace
Information Technology (Pvt) Limited, Islamabad, Pakistan 3 National University
of Modern Languages, Islamabad, Pakistan

Abstract: 21st century is the century of information technology (IT) and
globalization. Information technology is playing its significant role in the
betterment of the organizations. This paper explores another very important
role of IT on global management i.e., IT helps to redefine the vision of global
corporations which is the primary component of global corporate strategy. IT
also plays a role in managing the global talent in an environment of cultural
diversity and in managing global supply chain management. The paper employs the
archival method of reviewing related literature (theoretical, applied and
empirical) and organizing and presenting the propositions for future empirical
research. Key words: Information Technology % Global management % Vision %
Corporate strategy % Global supply chain management INTRODUCTION Advancements
in information technology (IT) and the rapid globalization of businesses, both
are realities and opportunities of the 21st Century [1]. The term information
technology refers to techniques and facilities designed to enable the transfer,
storing and processing of data [2]. This includes not only computers but also
facilities for mailing services, telephone and fax networks, information
centers and libraries. Internet is definitely one of its manifestations.
Consumer markets are growing more global every day. Brands like Coca-Cola,
McDonald’s and Microsoft are popular not only in USA but also well known across
the world. Manufacturing companies have got the opportunity of globalization
and today, much of the world’s manufacturers and suppliers are located in the
lower-cost countries (e.g. Nike has its manufactures in Thailand and Sony has
in China). The Internet has further linked the overseas suppliers of services
and goods and their buyers. Internet traffic is increasing day by day and
e-business is in hyper growth. At the same time, borders are becoming
increasingly extraneous, while people and organizations are intermingling in
very different ways [3]. This rapid growth in globalization has demanded the
need of integrated strategies in promoting organizational change technology
innovation and entrepreneurship [4, 5, 6]. Globalization, at one end, is an
opportunity, but at another end it also creates challenges for the
multinational companies. Global corporations have two primary challenges;
talent management – as they have to share resources and knowledge across a
number of business units inside and outside the country [7] and supply chain
management [8]. Moreover, before going global it is very important to have
global mindset or global vision. This paper presents the impact of IT on global
management. The areas covered in this paper are vision, corporate strategy,
cultural diversity and global supply chain management. Construction of the
paper is as follows: All areas are discussed one by one. Under each heading,
importance of that particular area is discussed with the references of previous
literature and case studies and discusses how IT can play a role in supporting
or redefining that particular area. After discussion, propositions are made for
future empirical study. This study also presents a theoretical framework.
Secondary data i.e. previous literature like research papers, research articles
and case studies etc., is used to support the arguments. In the end, concluding
remarks are given along with limitations and future directions. IT and Global
Vision: Global leadership development must be determined by an organization’s
global business strategy. Only having “global” experiences at work is not

Corresponding Author: Irfan Ahmed, Iqra University, 5, Khayaban-e-Johar, H-9,
Islamabad-44000, Pakistan. Tel: 92-345-5150655, E-mail: irfisam@gmail.com.

1100HND Assignment Help

World Appl. Sci. J., 12 (7): 1100-1106, 2011

enough for effective global leadership. Having a true global mindset enables
leadership effectiveness in a global environment. Increase in cultural `and
business complexity demands for a global mindset. To be a global organization,
company’s vision and values must show global consistency [9]. Yang Jianguo of
Deronde International was appointed as the global head of product development
[10]. He was very committed and devoted person and had very successful career
as a country manager, but he faced some problems when he came to France as a
Global leader. He was focusing on local culture instead of global world. One
can say that he was lacking global mindset. Therefore, his ideas were not
appreciated by his colleagues even by his CEO. It is clear that the most
important attribute required for effective global leadership is not a new set
of skills or experience, but rather a new perspective called a global mindset
[9]. A question confounding top management of the world’s leading corporations
is how to identify and develop global leadership competencies for the future
direction of their businesses. A popularly held view is that successful global
management will think strategically in a world-wide context [11]. Rapid change
in the organization’s environment resulting in uncertainty of goals in the
issues together with continually increasing complexity of issues present
considerable challenges on analytic and deductive modeling and knowledge
acquisition approaches. The key function of leaders and managers in this situation
is to form visions of the organization in the future [2]. Companies understand
that going global can only be realized through a global vision and strategy
[3]. But how? Cohen (2010) has given four approaches to develop global
leadership. C C C C Examination Education Experience Exposure

How IT can play its role to redefine vision or to develop global leadership?
For this, it is critical for top management and IT to agree on where IT is to
provide leadership and vision (Fig. 1) and where IT is expected to partner and
support [8]. Top management should work with IT to translate the business
vision to technical reality [12]. Modern computers with their elevated
calculating and graphical output capabilities offer the opportunity to form
visions with due work processes in a virtual world of simulation models [2].
The leaders or managers can play with these visions and gain ‘experience’ of
how the system solutions would function in certain important aspects. The
experience can concern both the outcomes of decisions under given constraints
and the constraints themselves. Training plays a very important role in
redefining the vision of the managers.

Financial  management Assignment help

Travel and tourism Management

For instance, Jack Welch, the CEO of GE
wanted to inculcate the anti-union sentiment in managers [13]. To make the
mindset of the managers and leaders in this way, he introduced different
courses for managers and also held “Personnel Relations Leadership Seminar”.
One of the course learning objectives was to develop UA (Union Avoidance) in
the managers. As for as training and education are concerned, there are a
number of IT based softwares which companies can use for global leadership
training. Computer based training and simulation models play a very important
role in redefining the vision of the people [14, 15]. Hassan, (2009) gives the
list of IT softwares (Table 1), which can be used by companies [16]. Following
propositions are made on the basis of the above discussion; Proposition 1:
Global management is positively correlated with the global vision of the managers.
Proposition 2: Global vision is positively correlated with the IT.

Information Technology

Cultural Diversity Vision (Global mindset) Corporate Strategy

Global Supply Chain Management

Fig. 1: Theoretical Framework


Unit 6 Research project

Unit 42 – Employability skills

World Appl. Sci. J., 12 (7): 1100-1106, 2011
Table 1: Different types of IT softwares Software Computer Assisted
Instructions (CAI) Computer Managed Instructions (CMI) Computer Based
Simulations Description It is a system of individualized instruction that uses
a program presented by a computer as a learning medium. Major types are: Drill
and Practice, Tutorial, Dialog, Testing In this, computer assigns a candidate
to read certain book, listen certain tape; attend certain lecture and so on. On
completing the assignment, the candidate returns to the computer for testing
and further assignment To simulate is to copy the behavior of one system with a
different, dissimilar system. Thus a computer can be programmed to behave like
some other system. Simulation is used when direct experimentation is impossible
or undesirable or uneconomical or immoral or simply slow. Computer Aided
Problem Solving t is used to explore and organize material from different
sources by using computer as an aid to problem solving

Source: Adapted from a textbook of computer science, National Book Foundation,
Islamabad, Pakistan

IT and Corporate Strategy: IT takes in business processes related to
information technology or communication technology including decision making.
For instance, IT adoption would include having an organizational intranet,
having enterprise resource planning (ERP) systems installed [17], using e-mail
for external communications, having an EDI, Video conferencing with suppliers
and so on [18]. Formulation of effective business strategy for a firm is not an
easy task. Strategic and organizational requirements for
person-system-organization fit are, therefore, becoming an important area of
research for competitive advantage through deepening knowledge of technology,
strong financial backing, learning new technological skills and information,
building up the capabilities and competencies for organization design can
distribute and serve a large customer base [19]. The Internet is creating one
global market place which is free from any geographical boundary. E-business is
just a mouse click away no matter where they are physically located, allowing
buyers to comparison-shop globally. The IT has not changed the fundamentals of
strategy – it is still about wining in both the competitive and capital markets.
What the IT has changed, however, is the speed of strategy formation and
evaluation. IT and Internet have also changed the formulation, execution and
evaluation of global strategy’s key elements – vision and planning, measurement
and the utilization of partnerships [3]. New technologies help to make a
real-time dynamic strategic process that obsolete the traditional planning
cycles. They facilitate greater input into strategy process by everyone in the
organization, challenging established decision-making norms. Consequently,
planning becomes dynamic, with the active involvement of the IT and the entire
organization. Finally, strategic execution, which depends upon the flow of
information, becomes easy by the Internet, both within the company and throughout

network of suppliers. Globalization has increased the connectivity and
collaboration which in turn has increased the magnitude and volatility of data
available with and between organizations [20]. Intelligent agents are now
emerging as a way to deal with this astounding variety of data in diverse and
assorted environments [21]. Global information systems play a significant role
for multinational companies in implementing strategies. These systems give
competitive advantage to a business by enabling timely transfer of information
irrespective of the different time zones and geographical constraints [22]. On
the basis of above discussion, following proposition is made; Proposition 3: IT
and global corporate strategy are positively correlated. IT and Cultural
Diversity: Cultural distance; which means the difference between country
cultures, has become a very important factor in global business [23].
Organizational culture and team development have become more and crucial with
the development of globalization and virtual organizations. Cultural distance
moderates the role of IT adoption on globalization. One study on collaborative
information infrastructure in a distributed virtual enterprise presented a
theoretical approach to engineering collaboration in the process of designing
production systems [24]. In the recent years, interpersonal relationship is
becoming more and more important HR factor for organizational effectiveness of
technological innovations [25]. Employee development is a pillar of the
enterprise-value framework for advanced global companies, equal in importance
to shareholder support or customer loyalty. Retaining talent is identified as a
key business priority for all the companies surveyed by World Economic Forum
[3, 7].


Unit 4 – Personal  and professional development in health and social care

World Appl. Sci. J., 12 (7): 1100-1106, 2011

The digital economy has changed the relationship between global companies and
the workforce. In the globally connected business environments employees have
more options than ever before; members of a “freeagent” workforce can expect
and demand more from the employer in exchange for their loyalty. New
Internetrelated technologies facilitate the recruitment of quality employees
from around the world and enable increasingly creative work arrangements that
balance work demands and family responsibilities. Research shows that global
firms are increasingly using Internet – IT related technologies to enable and
necessitate the use of virtual teams around the world to solve complex global
problems and foster both knowledge integration and continuous learning, which
aid in the motivation and retention of a company’s best people [3, 26]. The
rapid change in organizational structure and globally distributed engineering
demands for integrated strategies and new ways of HRM in promoting
organizational culture and entrepreneurship [4, 5, 6]. Besides this, companies
are facing the problem of balancing the culture of openness and
knowledge-sharing with the need to appropriate knowledge as intellectual
property. IT can play a very important role in knowledge sharing specifically
in an environment of cultural diversity. Refer to the example of IBM’s
ThinkPlace program, “catalyst” where employees post ideas on an intranet site
and invite comment or support from other people [27]. This approach could be
adopted to nurture the ideas within the organization. Knowledge management is
itself a global challenge in such kind of cultural diversity. In fact,
knowledge management is essentially a deeply social process which must take
into account the human and social factors primarily [28]. Two main approaches
are used for knowledge management. One focuses on the deployment and use of
appropriate technology to utilize knowledge while the other focuses on the
capture and transformation of knowledge into a corporate asset [28, 29]. The
first approach emphasizes information technology (IT) and focuses on it as the
mechanism for managing knowledge [30, 31]. The second emphasizes people and
processes. It attaches greater importance to human relations and the
elicitation of tacit knowledge [32, 33, 34]. Hence the study proposes that;
Proposition 4: IT is positively correlated with the cultural diversity
Proposition 5: IT is positively correlated with the knowledge-sharing

IT and Global Supply Chain Management: In today’s highly competitive and global
environment, companies need to improve effectiveness and efficiency. GSCM, as a
major part of business operations, plays an important role for organizations to
achieve competitive advantage [8]. Good supply chain management can help a
company to meet market demand. A good supply chain is that which is able to
move product to market faster and cut the cost of moving goods from the source
to the customer [35]. The wide applications of IT make it possible for
organizations to improve the overall business operations. Supply chain managers
increasingly want to automate all of the supply chain, from forecasting to
distribution and to every element of the chain [36]. Today, companies want an
integrated solution to enable them to see the entire supply chain at once. For
instance, they want to know that if they drill down to forecast, they can see
the demand history, which is a combination of data which comes from sales order
processing, inventory management and the warehousing system.HND Assignment Help Less human
intervention and the flow of parts and products along the supply chain can help
dramatically in cutting logistics costs and boosting customer satisfaction
[37]. “To survive, let alone win, a company must be part of one or more supply
chains producing world class performance” [38]. Hence companies need to work
together and optimize the complete pipeline by establishing a seamless supply
chain (“think and act on”) to maximize their market share. The global industry
of today demands logistics managements to plan and execute customer-led,
profitdriven tactics, where an array of alternative production and procurement
methods is deployed simultaneously. GSCM is the philosophy that underpins the
logistics business in the Royal Air Force [39]. RAF is developing a new IT
system, LITS (Logistics Information Technology Strategy) to support GSCM. Table
2 provides examples of corporations that provide IT tools/services and
corporations that have successfully implemented IT related software packages in
GSCM. The strategy in GSCM is to optimize product and information flow from the
purchase of raw material to the delivery of finished product, with the aim of
achieving ever higher levels of productivity, quality, innovation and alliance
between the company and its vendors and customers [40]. Companies exploiting IT
and related technologies are successfully implementing this strategy. For
example, Benetton, of Italy, is often cited as one of Europe’s success stories
[8]. It does not have its own manufacturing facilities or


World Appl. Sci. J., 12 (7): 1100-1106, 2011
Table 2: Corporations that provide IT tools and corporations that use IT tools
Corporations that provide IT tools Name Allied-Corp. CAPS logistics Inc.
Chesapeake Decision Sciences, Inc. CyberSystem Technologies, Inc. Global
Information Solutions i2 Technologies InterTrans Logistics Solutions
LogicTools, Inc. Lyte Group, Inc. Supply Chain@ Solutions
Description/application of IT tools provided Global company integrating SCM
services to industrial clients worldwide Specializing in decision optimization
software for supply-chain modeling Provides software and services for
developing supply-chain and scheduling solutions Offers fully-automated,
supply-chain management systems, called intraMalls Provides
logistics/supply-chain software products and custom programs Provides
clients/server based eBPO software products for SCM and related business
Provides enterprise-wide, integrated client/server SCM software applications
Develops SCM tools for intelligent strategic, operational and tactical decision
Offers integrated SCM and planning software solutions Developer of application
software to manage the supply-chain environments of manufacturers, wholesalers,
etc. Corporations that have successfully implemented IT related software
packages in GSCM Compaq Cumberland Packaging Data Card Kobe Copper Products
Pair Gain Philips Semiconductors Thompson Consumer Electronics Xircom Name
Cardinal Logistics, Inc.

Unit 4 – Personal  and professional development in health and social care

Direct benefits from IT implementation in GSCM
Increased customer service; reduced customers’ inventory levels; reduced
customers’ transportation costs Increased on-time delivery to 95 percent;
decreased inventory; decreased order-to-receipt cycle time to five days
Decreased inventory by 10 to 15 percent, or approximately by $2 million;
reduced production costs substantially Reduced engineering change process time
from two weeds to two hours Increased the information sharing across the
company dramatically. Approximate saving of $270,000 per year on account of
this information sharing Saved millions of dollars by strengthening corporation
among employees and outside business partners; cut change cycle time by nine
weeks Increased forecasting accuracy; decreased inventory levels; integrated logistics
and marketing functions Reduced planning cycle time from four to five weeks to
one week; reduced raw materials, work-in-process and finished goods inventory
substantially Increased the speed of engineering change order cycle by five
times; permitted instant broadcast of product data worldwide Note: Adapted from

retailing outlets and serves as a merchandiser and distributor, who contracts
manufacturing and sell through franchised outlets. Using its excellent IT
system Benetton responds to the pull of the marketplace to schedule
manufacturing and directs to correct products to its customers [41]. Following
propositions are made herewith; Proposition 6: IT is positively correlated with
business operations of the company. Proposition 7: IT is positively correlated
with global supply chain management system. CONCLUDING REMARKS The world has
now become a global village. Borders and barriers are going to be vanished. In
order to operate

effectively in an environment of borderless markets, global multinational
corporations have to manage their corporate philosophy in order to sustain in
this environment of globalization and information technology [42]. Information
technology is a great truth of this century and it has a great impact on
globalization. This paper discusses the role of information technology for
global management. Multinational companies which are implementing IT and
related technologies are enjoying competitive advantage over the companies which
don’t do the same. In this paper, several areas of global management are taken
and discuss how IT has already helped or can help in these particular areas.
Previous literature has been taken in this study. One of the limitations of
this study is that it is based on secondary data. In future, primary data could
be used to support the argument that IT has a direct relationship with global
management. 1104

World Appl. Sci. J., 12 (7): 1100-1106, 2011

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