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Structured Abstract
Purpose
This paper explores the benefits accrued by organizations or institutions by embracing the modern methods of managing information. An efficient business needs thorough and methodological information management, which includes processing of information and making decisions. Information management system offers the information vital to run an organization effectively. This information generated and Produced within the system is widely considered necessary elements for discreet and sensible business decisions.
Information management systems are used by all levels of management. They help in supporting the organizations long term goals and objectives. In a nut shell, each and every organization needs to invest huge sums of money in information management to survive in the ever competitive local, regional and global market. To demonstrate this fact, this paper examines the e-business of Transport for London (TfL) online ticketing system known as Oyster.
TfLs award-winning website (tfl.gov.uk), with its live, up-to-the-minute travel news, valuable tools and information, is already extremely popular with the travelling public. New developments during the period of this Plan should make it even more so. Each month around 10 million visits are made to the site to plan journeys, find travel information and maps, and buy Oyster Cards or pay the Congestion Charge. Some 68 per cent of Londoners have used it, and five per cent visit it every day.
Design/Methodology/Approach
The research instrument has been the Oyster Online ticketing database which contains information about Oyster information processing, Oyster Ticketing management and basis for decision making. Transport for London Customer satisfaction survey results were also analysed to assess what impact the Oyster online travel facility had on the achievement of Transport for Londons Strategic Objectives.
Findings
It is demonstrated that in Transport for London, Technology in the form of e-business online Oyster ticketing system have transformed the way its Customers purchase and use their travel facilities resulting in significant cost reduction including the lost of 800 ticket office jobs in London Underground which is a subsidiary of Transport for London. This success was brought about a good management of the companys strategic information system and delivered by an effective IS/IT strategy.
Research Limitations
This paper is reliant on information provided by Transport for London on its online web site and information derived from its customer satisfaction surveys and questionnaire results. Further independent research is required to assess customer satisfaction with the oyster product.
The value of the paper and practical implications
Due to the critical analysis of the success of Oyster online business provided by this paper, the analysis reported here provide a snapshot of the use, usefulness and value of information for undertaking online business.
Introduction
Background
The world today is significantly changing and working in an information era. The administration of any organization has to internalise huge volumes of data and change into information which is used in making decisions to ensure success in the business entity (Harizanova 2003). For each and every organization, information is very significant just like money, implements and human resource. Therefore, information is necessary for the sustainability of any business.
The term information management entails collection and prudent handling of information as it is channelled from one place to another (within or without the organizations premises (Wilson 2004). Management information systems on the other hand are a computer system that satisfies the need the information required by the e top and middle leadership.
Before people and organizations began to use computers, they were faces with myriad challenges collecting, storing, controlling, and supplying huge volumes of data and information. The development of Information technology has made it possible for the administration to choose the information best suited for them, their needs promptly. Information collected should always be up to date and is very vital for almost every member of the business concurrently. Therefore, this information must be precise, succinct, up to date, inclusive, and coherent and can be stored (Harizanova 2003).
Many companies currently rely on information technology in almost every aspect of their operation and management. However, the use of computers alone can not guarantee success in an organization but how effective and efficiently they are utilized (Wilson 2004). Information systems are the processes by which information reaches all members of an organization when needed. Information systems are installed to help the managers by providing them with vital information used in decision making.
Information systems undoubtedly help organizations in the dispensation of data into precise, logical, timely, applicable, advanced and effective expenditure. Whether the information is prudently utilized will depend on the workers within the sector ability to manage information (Harizanova 2003).
Transport for London Oyster ticketing system has benefited from innovative and effective information systems and strategies. Oyster is a blue plastic card that customers can use instead of paper tickets. Customers can put travel cards, passes and rail cards on it, as well as credit which customers use up as they travel. Refinements are continually being made to the site. In 2009/10 these included improvements to key areas such as Journey Planner and transactions for Oyster and Congestion Charging, making the system easier to use.
TfL is also keeping pace with advances in mobile phone technology. It is currently working on systems that will give mobile planning services. By 2014 Customers will, for instance, be able to get real-time travel updates as well as street and Tube maps and receive personalised information. They will also be able to use their mobiles for Oyster top-ups and other payment services quickly, reliably and while on the move.
Literature Review
The information that created or generated in a business can turn to be an asset or a liability depending on how the business manages these information. The concept of information management involves asking the correct questions at the right time concerning the handling of information produced internally. Information management ensures Information follows the right stages and establishing the most important factors that influence information management in each stage (Ames2003). Management information system offers information that is essential to run the business effectively. Information generated is considered very vital for sensible and rational decision making (Harizanova 2003).
In order for any company to succeed in the global market, it must redesign itself to acquire the basis of sustainable growth. One of the features for the evolution in information management is that information has become very vital for any business to succeed. In addition, advancement in information management has played big part in business competiveness, sharpens their response to changes in business environment, and broadens their inventory management for better market performance (Maes 2003).
Many organizations spends huge sum of money in advanced technological solutions but struggles to manage these information to maintain and enhance business performance. However, Transport for London have succeeded in managing information and transforming their entities into an electronic business model (Abcouwer 2004).The Information Communication Technology (ICT) industry and the comprehensive national infrastructures supporting ICT applications had been the main drivers of the global economic competitiveness (Maes 2003).
Different levels of management require different types of information. Efficiency in information management facilitates planning, coordination, organising and controlling measures. This information is very important in strategic planning and daily operations. Levels of management in an organization require different types of information thus the need for formatting. Different levels of management require different types of information which can be categorised as strategic, operational, and tactical (Maes2003).
Operational information is that type of information that is internal and has a contracted scope. Operational information is normally used on daily basis or on weekly basis. The Oyster help desk receives an average of 1000 new oyster card registrations daily but they also deal with an average of 100 failed oyster cards a day. While Oyster travel product is popular with customers because it is an efficient, faster and cheaper way to travel, there are concerns about the reliability of the product due to the numbers of failed oyster card returns.
Tactical information has a broader scope since it encompasses information both within and without the organization. The major concern with this type of information is that the present affects the future performance of an organization and these include information such as revenue, sales among others (Maes 2003). The Oyster travel product generates revenues in 5 different ways and is targeted to different segments of the market. Commuters are encourage to purchase a weekly, monthly or yearly travel cards to receive a discount usually around 1, 3 and 5% respectively.
These customers account for 70% of total passengers carried each year and because payment is made in advance, they provide significant revenues which allow the company to plan its budgets more effectively. The Leisure Users are encouraged to buy credits on their cards known as top- ups which are automatically debited as the customers travel through companys transport network by touching in on an oyster reader at the beginning of their journey and out at the end of their journey. This allows the oyster to calculate the correct fare and deduct. Oyster readers are placed on places such as stations gate lines, on buses and along inter- change routes.
Strategic information is mainly information from the outside sources which is often incomplete and ranges widely from the information on global market conditions to the government policies affecting the business amongst others. Without proper and accurate information, managers can not make any tangible decisions and this is why the growth of information management has increased (Wilson 2004).
The Transport for London Board of Directors regularly receive information about levels of emissions in the capital citys environment and develop strategies to meet government targets on greener environment. Fare levels and income projections for this Business Plan include the impact of the increase in bus and Underground fares in January 2010, as set out in the Mayors fares announcement on 15 October which is dependent on Department for Transports Funding Settlement. The Plan also assumes that fares will rise at the Retail Price Index (RPI) plus two per cent from January 2011.3
Steps in the development of MIS (Management information system)
The first step was the introduction of computers in the organization which were used for specific business functions. These computers were placed in the electronic data processing unit since they required highly trained professionals to operate (Markus 2004). The development of the electronic data processing unit prompted the management to concentrate more on setting up the MIS in the organization.
MIS department mainly used data from the electronic data processing unit after compilation. This information could also be obtained from within and without. MIS has now grow beyond just processing data but also in the decision making process (Decision support system). Decision support system helps solving semi structured problems and supporting decision making as compared to the MIS which deals mostly with data processing (Gerstein and Reisman 2003).
One of the break-through in information technology is the creation of artificial intelligence which makes use of the computer to arouse human kind of thinking. Artificial intelligence involves arousal of human thinking to choose the best approach in decision making or to an emergency. An example of the artificial intelligence is the expert system which is synonymous to a human professional assessing a situation (Markus 2004).
Expert systems are also known knowledge oriented systems because they are made on the basis of the recognized facts and reaction to situations. Use of computer technology in information management and decision making has influenced decision making significantly and the behaviours of organizations (Hatch 2010). Transport for London Oyster ticketing system uses both MIS to process oyster transactions and also decision support system which analyses the data and assists managers to make decisions.
Dynamics of management information technology to an organization
The development of information technology provides a wider opportunity to enhance the working of an organization. Nevertheless, the introduction of these new technologies does not necessarily mean success to every organization. These technologies have caused a lot of panic and fear among the work force as result of job insecurity they pose. However, information management technology has eased storage, processing and accessibility of information more than before. Despite of its threat to job insecurity, the advanced information management technologies offers more skills into the job market dominated by unskilled and semi-skilled labourers (Markus 2004).
Benefits accrued to information management technologies ca not be realised unless the organization relates them with the stakeholders such as the suppliers, consumers, and other business partners, improvement of labour among others. Changes in an organization in relation to MIS should consist of set of strongly related developments in the companys structure, in production process, in human resource and skills required, and in the systems of technology (Liu and Yu 2004).
Researchers in the field of communication have investigated how the patters of different means of communication influence a multitude of events ranging from persuasion to efficiency in production (Hatch 2010). Advancement in information technology has enhanced flexibility in working arrangement thus shifting business world towards information society. The adoption of modern information management practices has enhanced the competitive level of businesses, their flexibility, responsiveness and profitability by minimising cost (Wilson 2004).
The Information Communication Technology (ICT) industry and the comprehensive information management systems have become the main drivers of the global economic competitiveness (Markus 2004). As Information Technology (IT) rapidly evolves so do the gross profit margins for original manufacturer (OEM) or original design manufacturer (ODM) business gradually declined, sharp analysis was necessary for recognition of emerging trends that met future market demand. Implementation of innovative services has increased the core value of organizational products that boost the development of ICT industry and contributes to new business models for service industry (Stratopoulos and Dehning 2000).
Integration of information management system with ICT products could prolong product life cycles and fostered long term and stable profits. In addition, both ICT and service industries drive the proliferation of new channels for the global innovative service market. Hence, the development of Service Oriented Devices (SODs) is leverage to the existing strengths of an organization and thus helps to maintain the organization into a leading position in the industry.
Information management has led to service oriented devices due to consumer adapting to information technology. Internet shopping is becoming common among consumers as a result of accessible online information (Stratopoulos and Dehning 2000; Markus 2004).
Application of management information systems
Many organizations especially those in Europe and US have used information technology to woo customers all over the world. Information technology and information technology enabled business have enhanced service delivery all over the world. Information technology is aimed at helping the businessmen to get better understanding of the market place thus enabling them to embark on selecting strategies to effectively reach the consumer. Society comprise of people of different segments of consumers, based on class, status, and income (Wilson 2004).
The current advancement in consumerism is the surfacing of the non-urban market for a number of basic end user goods in the developing nations. Majority of this population live in rural areas and contributed one-third of the national income (Palvia et al. n.d) Developing nations have a huge market even for costly products though per capita income is low.
Consumers have become selective on the quality of the products or services. Consumers search for more reliable sources for purchase, for instance known retail shops that are organized and even have corporate setting and where liability are more well-defined. The customer also sort to acquire from an organization or company where response taken seriously by the organization. They are well-informed about the product they are acquiring, the technology and also the market and are insisting for gains that are beyond just accessibility of an assortment of products which are from trusted manufacturers. Consumers are price sensitive and preferred to buy value for money products (Stratopoulos and Dehning 2000).
Consumers are buying through online variety of products. This had been made possible by extensive information technology products. Celebrities were increasingly being used in marketing communication by marketers to lend personality to their products. Celebrities in television media had increased due to popularity of visual media. What they endorse sell greatly. Consumers are influenced by freebies (Palvia et al. n.d).
Consumer from other parts of the world buying behaviour to large extend has western influence. There has been increase in information online by different organizations prompting this behaviour. Consumer has become open minded and experimental in perspective in that there is a very big growth of European drifts that are available to other consumers across the globe mainly through media and other people who work abroad. Foreign brands vie with domestic brands for the growing market. Also to be noted is that consumers have also extended way of life which is as a result of the change outlooks and way of thinking; this is because of the access to information and also the need for self-indulgence. Hi-tech products are few instances that reflect these changes (Stratopoulos and Dehning 2000).
Harizanova, (2003) articulates that consumers too concrete with businesses, for instance online search engines, is seen as a service or product but was created by dispersed customers. Internet has increasingly become a widespread platform for interaction, communication and activities between businesses and consumers. Consumers at an increasing rate engage different organizations online and these enables the companies to tap the new mood of customer engagement for their business advantage
Many companies nowadays involve customers in design, trials and marketing and other procedures by use of new information technologies, to get better insight into the desires and behaviour of customers thus pace up development successions. Companies who engaged in such kinds of act are not influenced by a click of minority rather by the wider market perspective. These companies focuses on long range needs rather than immediate customer needs to avoid failing to meet expectations. This illustrates importance of information management technology in consumer product development as a result of consumer tastes and preferences (Harizanova 2003).
Data mining and its significance for the Transport for London Company
Data mining entails use of very complex data analysis tools to find out formerly unknown patterns and relationship between data. These can be organizational data which includes data from various operational processes or trade. Data mining encompasses many disciplines in its analysis such as statistics, machine learning, and computer science. Statistical tools used are like operations research, linear programming, and regression and correlation analysis among others (Abcouwer 2004).
Data mining entails more than just data collection and storage; it also includes data analysis and forecast. Data involved here can be qualitative, textual or multimedia data. Data mining applications utilizes various factors to analyse data. These include association, sequences or course analysis, classification, clustering and prediction (Wilson 2004).
Several advances in the information technology and information management contributed to the increasing use of data mining in public and private sector. Some of these advances include escalation of computer networks, development of the search engines, increase server computing model just to name but a few (Wilson 2004).
Besides improved information management apparatus, increased accessibility of information and reduction in the cost of storage and retrieving data. Over the recent past, organizations have been experiencing the pr5oblem of data accumulation into large volumes that are difficult to manage. Studies show that data volume doubles its self every year in organizations. However, cost of managing these data has decreased considerably thanks to the data mining technologies. Stratopoulos & Dehning (2000) state that, data mining has become very common both in the public and private sectors .
Several companies including Transport for London uses data mining technology (Oyster products) to minimise fraud, time wastage, customer surveillance, disaster management among other uses. Nevertheless, propagation of data mining has raised a lot of eye brows in its implementation and its role as an oversight tool. The main concerns relates to the quality of data being analysed, interoperability of the storage devices, and privacy concerns.
It is also known that despite it being a dominant tool in managing of information, though the products gotten from it are not self sufficient. They necessitate skilled personnel for analysing and interpreting data. Therefore, limitations of data mining products are majorly personnel related and not technological (Stratopoulos & Dehning 2000).
The emergence of advanced information technologies in the early 1990s gave rise to various organizational transformations. Many businesses have adopted information technologies to reduce travelling, hence minimizing operational costs. Companies used to send their representatives to book for bus or train tickets but this has changed with introduction of oyster travelling products. With the introduction of these products into the transport organizations operations, various leaders, which include company executives and personnel managers, have had easy work when it comes to decision making. Other important leaders in the organizations who have enjoyed these products are sales and marketing managers, and product development managers (Wilson 2004).
The emergence of data mining technologies requires strategic leadership in organizations. Since the technology is new, a lot of considerations were made before their incorporation into the business. The inclusion of this technology into the organization called for great monetary input due to the installation and operational costs. Data mining technologies enhances strategic leadership and therefore leaders able to make appropriate decision, which considers sustainable benefits and long term operational costs (Liu and Yu 2004).
The emergence of data mining technologies gave rise to rapid transformation of organizations in the global business landscape. Companies thrived to get a share of the international market by using information and communication technology as a stepping stone. As much as there was lucrative opportunities due to advanced technologies, various uncertainties docked the whole progression. Some of the hurdles included compliancy to environmental concerns, divergent consumer preferences, and difficulty in developing sustainable competitive advantage.
These incidences creates a mandatory situation of involving key stakeholders in organizational transformations to amply understand the major issues of the business, hence smooth operations. By following g the patterns and trends of these data and information within the data base, data mining technologies has helped organizations to overcome these problems (Abcouwer 2004).
Emergence of information technologies has caused irresistible challenges to business in terms of information exchange both within and outside the organization. The changes have led to various difficulties that face the labour force, thus posing high chances of poor performance in the challenging market conditions. The emergence of advanced technologies has pushed many organizations into relegation, due to adaptation failure of the human resources.
Many organizations fail to realize the critical role of labour force in the routinely organizational operations, therefore end up making mistakes that are very costly to reverse (Liu and Yu 2004). Data mining technology makes it easy for everybody within an organization to access information and use it in decision making thus enhances participation.
Change in every organization is critical, regardless of the type, whether positive or negative. Positive changes as the phrase suggests might only prove so if appropriate measures are put in place. For example, the incorporation of data mining technologies in organization may seem positive on the face value, because of the ability to reduce operational costs and improve information exchange. This might turn negative in the event that labour force does not receive adequate training to embrace change. This reflects the significance of appropriate training and giving information about change in the organization in endeavour to improve performance
Many organizations face the problem of measuring changes, hence causing difficulty in making appropriate improvements in the affected areas. Failure to quantify changes in the business operational process may be disastrous especially when an organization over looks the intensity. As much as a business realizes positive change like increased sales and profits, the sustainability might be difficult when adequate measurement tools are missing. The integration of data mining technologies within the business strategies result into positive changes, which validates the old adage of change, is inevitable in every situation. Data mining technology uses statistical analysis to monitor the business trend in profitability and operations thus helps in making necessary adjustments (Abcouwer 2004).
Change measurement is equally imperative as reporting, for instance, an increase in sales may be realized in a certain company, but poor reporting will not assist in improving the sustainable overall performance. An established organization should incorporate key performance indicators to gauge the routine operations, hence increasing their competitive advantage. Reporting the organizations change should follow proper order without assuming the hierarchal level, hence showing responsibility in their respective areas of work. These have been made easier through data mining where statistical tools can be used to analyse historical data to give reports about an organizations progress (Hatch 2010).
There is a great significance in quantifying and reporting the magnitude of change in an organization. Potential businesses often fail to hit their performance targets, due to lack of appropriate measurement and reporting tools, thus suffer losses that would be freely prevented. Change is flexible, and can therefore be positive or negative depending on the operations and management of an organization. Positive changes require robust reinforcement to ensure sustainable competitive advantage in the challenging market conditions. Data mining technology provides these trends and patterns at glance (Abcouwer 2004).
Data mining technology creates business reinforcement in all aspect of its operations or processes. Reinforcement is a word that applies to forward actions, such as positive changes in an organization. For instance, when an organization realizes increased sales and profits, a great back up is important to create sustainability in growth. The organizations senior management should design and implement competitive strategies that ensure long term existence in the volatile market conditions Oysters products just like any other advanced technology assist in reducing the lead time, improving deliveries, inventory management, production, sales, and outsourcing, among other areas (Liu &Yu 2004).
Organizations require effective reinforcement to positive changes that the technology will bring forth such as consumer satisfaction, hence loyalty and increased sales. Consequently, marginal returns will increase thus higher chances of global growth in the ever dynamic business landscape. Failure by an organization to establish strong reinforcements to changes creates havoc to the future operations of various business units (Abcouwer 2004).
The current business landscape is full of uncertainties, which include but not limited to products recall, government regulations, economic melt down, business espionages, and natural calamities. These risks cause abrupt disruption of the planned business trips, which may make an organization to lose a substantial amount of revenues, thus facing relegation in the ever challenging market conditions. Labour force requires adequate reinforcement tools and skills for business disaster preparedness, hence maintaining the organizations competitive advantage. Reinforcement to such business changes may seem difficult without the incorporation of technology in the transport sector(Wilson 2004).
Data mining technology has been used a great deal in managing disaster in the Transport for London Company. In most instances, a point of observation and control is established to mitigate the projected disaster. Theses centres are used to acquire information above the ground and analyze such statistics in order to realize the coherent results about the potential disaster that may arise. These centres are sometimes used to disseminate the collected and analyzed information to the society as a form of disaster preparedness (Abcouwer 2004).
Significance of Oyster products
Transport for London is a company that manages buses in the greater London city in the United Kingdom. These buses require the same ticketing scheme. The main responsibilities for the transport for London company is planning route for buses, setting service level and quality, managing bus supporting services, providing information to the general public relating to locations, timetables and routes among others. The company has adopted data mining products known as the Oyster travelling products (Hatch 2010).
Oyster products have enhanced efficiency among customers and the company itself. One of the major advantages of using this data mining product is that they make fare collection much easier and allows faster boarding the buses. Passengers do not have to wait for longer queues to make payment either at the bus stations or through online tickets, they just swipe their cards. Boarding process has been made very easy and smooth. Oyster products are also cost saving since they minimises cash handling which is prone to errors and requires a lot of labour (Liu & YU).
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