This paper analyzes the use of Smartphone technology in a big company- CPS Energy and another small company- Lloyd’s Construction. Specifically, we discuss the contribution of this technology in terms of profitability and performance improvement, the resistances faced during the introduction of this technology and their causes, possible alternatives through which these resistances could have been reduced, and the alternative use of this technology for the two companies. Finally, we assess the case in terms of information technology solution evaluation criteria.
Ways in which Smartphones Have Helped these Firms to improve their Profitability and Performance Arising from Cost Reductions or Revenue Increases.
The use of Smartphones has helped in reducing the amount of time it takes to close a business deal. Similarly, it has significantly reduced the volume of inventory, which indicates a high sales level achieved. Furthermore, it has significantly improved employee and customer satisfaction and reduced the service call time and costs. In terms of performance improvement, Smartphones have resulted in substantial improvements in performance primarily from cost reductions or savings.
Examples from the Case
Several examples of increased profitability and performance improvement are evident in the case. Firstly, when CPS Energy began using a digital camera, they could send only one employee who takes a photo of the damaged part and sends it to the office where it is diagnosed by an expert, and instructions for rectifying the problem are then transmitted using email, SMS or voice. This improved communication resulted in better field support, with fewer employees required to rectify a problem, while at the same time reducing the time required to close a service call. Secondly, improved communication increased the speed at which procurement deals are closed. This not only resulted in reduced inventory levels but also reduced the costs associated with holding inventory leading to fewer lost sales opportunities. In addition, it accelerated the order process by eliminating the need for key personnel to be on the site to approve orders. CPS Energy was therefore able to achieve faster order times as the approval of the orders could happen anywhere where there is network coverage. Furthermore, CPS Energy successfully improved both its customer and employee satisfaction levels because customer service calls could be resolved much faster and employees were equipped with the necessary resources they require to perform their roles (O’brien & Marakas, 2011, p. 79).
Similarly, despite its small size, Lloyd’s Construction significantly benefited from the eTrace software. The company successfully limited the number of unauthorized stops because the integrated mapping and travel provided by the software could locate the company`s assets in real-time. Secondly, the company reduced its fuel budget owing to the new efficient routing system. Similarly, it reduced the cost of an accountant by approximately $1000 per week and improved the data entry process and job logging, making it 1.5 times faster. Furthermore, for the fiscal year 2007, the company`s performance improved by between 10% and 12%, or approximately $1 million (O’brien & Marakas, 2011, p. 80).
Causes of Resistance from Employees and What Companies Can Do To Enhance the Reception of New Technologies
For CPS Energy, it is was difficult to secure the support of executives because the company`s management could not envision the benefits that Smartphones would offer to the company. The main cause of this resistance was because the executives had no prior fast-hand experience on the benefits of these devices, and they doubted the applicability of the devices to their business. Without experience, it is easy for managers not to visualize the benefits; instead, they only see the risks.
For Lloyd’s Construction, many of its employees were not tech-savvy and required a comprehensive training program, which affected the crossover time. The cause of the resistance largely originates from the nature of their jobs. The company’s employees were mainly compromised of foremen, and drivers who had limited or no formal education. Secondly, the fact that the technology was going to limit the employees` freedom (tracking software) was certainly going to be met with resistance.
Alternative Prepositions to Enhance Reception for both CPS Energy and Lloyd’s Construction
Implementing small-scale pilot projects. Such pilot projects are useful in demonstrating the value of the new technology to the organization and as a result secure the support of employees at all levels in the organization (Vieweg, Rodosek & Helmbrecht, 2013, p. 10).
Developing and implementing comprehensive training programs. The training programs should cover all aspects of the new initiatives, including but not limited to how to use them, their benefits to the individual employees and to the organization.
Gradual implementation process. This will give the employees sufficient time to familiarize themselves with the new systems and as a result, they are less likely to feel that they have been coerced into adopting new technology without the necessary skills. This will reduce the risk of resistance (Vieweg, Dreo & Helmbrecht, 2013, p. 10).
Recommendations on How They Could Have Used the Technology to Create New Products and Services for Their Customers
CPS energy could have created a product to link its customers by granting them access to part of the company`s infrastructure. For instance, it could develop a system where its customers can manage their accounts and interact with company personnel. Similarly, the company could make its experts or troubleshooting steps available online. This would permit its clients to identify solutions for their own problems or request help from experts who are able to connect directly to customer accounts (Liang, Huang, Yeh & Lin, 2007, p. 1155).
Given that the company’s operations are conducted on a project-by-project basis, the company can use its system to provide status information to its customers, coordinate projects, and report expenses. The system may also be useful in demonstrating that the company fully complies with regulations relating to handling demolition equipment (Liang, Huang, Yeh & Lin, 2007, p. 1155).
Information Technology Solution Evaluation Criteria
The problems in both CPS Energy and Lloyd’s Construction have been clearly identified. The prescribed Smartphone technology solutions not only solved the problems identified but also resulted in numerous other benefits as already discussed. In terms of cost-effectiveness, the solutions were cost-effective as evident in reduced inventory levels by over $8 million for CPS Energy and cost savings for accountant expenses by approximately $1000 per week. As a result, the case illustrates the appropriate use of technology to improve performance and profitability.
The case offers a good example of how all companies regardless of their industry, size, or scope can benefit from using Smartphone technology in their operations. Such successes are not without resistance and challenges, however, with effective planning, the challenges can be resolved. The use of smartphones has given the two companies a competitive edge over their peers, with significant strategic benefits including connecting employees and a flawless workflow. It is a technology that suits almost all businesses.
Liang, T., Huang, C., Yeh, Y. & Lin, B. (2007). Adoption of mobile technology in business: a fit-viability model. Industrial Management & Data Systems, 107 (8), pp. 1154-1169.
O’brien, J. A. & Marakas, G. M. (2011). Management information systems. New York: Mcgraw-Hill/Irwin.
Vieweg, J., Dreo Rodosek, G. & Helmbrecht, U. (2013). A concept for a trustworthy integration of smartphones in business environments. Retrieved on 11 February 2014 from <http://d-nb.info/1043162887/34>