How Business Sectors Benefit from Information Technology?

NB: We do not resell your papers. Upon ordering, we do an original paper exclusively for you.

NB: All your data is kept safe from the public.

Table of Contents

Introduction
Current Impact of IT in Hospitals
Future Impact of Technology in Hospitals
Conclusion
References

Introduction

The upcoming technological trends have a lot to offer since they eliminates repetitive tasks that are usually coupled with errors. There are numerous types of technologies, which can be introduced in any business sector with great impact. However, these systems require numerous maintenance practices once in a while so as to ensure their reliance on critical tasks.

Hospitals, manufacturing sectors and others have been the major beneficiaries of these technological advances. The industry is quite promising since in the past few years, more initiatives have been released to the market and in regards to that, future systems will be required to do more complex procedures requiring critical reasoning.

This paper explains how business sectors have benefited with the advances in technology when handling their various processes. Hospitals have also seen a reduction of errors upon introducing such systems and therefore, technology is the way forward for such sectors that want to reduce error rates in whatever processes they choose to undertake.

Information Technology is the way forward for any business that wants to attain a competitive advantage and therefore managers, consultants, financial analysts are considering investing in IT as the best option. (Brynjolfsson &Yang 1996 p,200)

For example, the analysts Solomon Brothers concluded that banks that were doing well in the mid 1980s had invested in IT as opposed to those that did not. Such anecdotal evidence and case studies have proven that investments in IT lead to a firm’s profitability regardless of the type of business. (Bharadwaj et al, 1999p,56)

More still, the Tobin’s q notion on the value for IT proved that IT investment leads to significant contribution to a firm’s potential growth. Tobin’s q value is a financial market based measure that is used to examine the association between IT and a firm’s q rewards. The study was conducted from 1988 to 1999 and found that in all the five years, companies that had invested in IT had a significant positive association with the Tobins’ q value (Bharadwaj et al, 1999 p,98).

According to Mukhopadhyay and Cooper (1993 p,132) investment in IT has become a serious issue for management today. It has enormous potential that can be used to improve the performance of an Organization and therefore, many companies have invested hugely in IT inputs in all their departments so as to attain this competitive advantage due to the changing trends in business. This has in turn improved their work flow of information from one department to the next one, which was not the case before the introduction of such systems.

IT systems can include any device that seeks to do away with manual procedures. For example, instead of doing manual calculations, a company may opt to use a computer for doing such calculations which proves to be a reliable and accurate procedure and this is a simple demonstration of how technology can be used.

There are those complex systems such Electronic data Interchange and decision support systems. For example, decision support system is best suited in the hospital where it has proven to work wonders (Butters & Eom 1992 p,28). All these are designed to make work easier for the common person while at the same time increase the level of output.

However, such moves of IT initiatives tend to ignite pressure to the top management since IT requires a lot of care. Care in the sense that a company must have technicians who will do the necessary maintenance when the system goes down or monitor the system to ensure that it is functioning well.

The systems may also require to be upgraded since the industry changes with time meaning that more and more technologies are usually released into the market. These are a few of the necessities that are associated with IT investment, though it’s nothing compared to the excepted results.

In addition, some technologies may be very complex and this may cause difficulties when implementing them. Such implementations require qualified engineers to oversee the installations for them to function properly. More still, they have to undertake proper analysis and ensure that the ideal technology is implemented in the right business set up.

A well functioning system may prove useless if introduced for the wrong purpose and with that in mind, a longitudinal case study was conduced focusing entirely on Electronic Data Interchange (EDI). (Mukhopadhyay & Cooper 1993 p,138) and this proved great success since it was implemented for the right job.

EDI is a system that has been in use since 1990 for both small and large companies and reports indicate that, over 40,000 firms were using EDI before 1994; and still more firms are still expected to use this technology in the few years to come. (Verity 1994 p, 108). Well known companies have continued to use this system including the Chrysler firm. Researchers have also found that vertical information integration is among the advantages incurred with EDI, and e-mail introduction within partners along an established chain.

According to Mukhopadhyay & Cooper (1993), a field study was conducted on the EDI program at Chrysler. It was meant to assess the management goal of reducing manufacturing processes that are normally handled on a daily basis. In addition to this, the research was supposed to determine the logistic costs and the streamlined operations for the JIT (just-in-time) implementations.

Magnificent results were reported all revolving around inventory, obsolescence and transportation costs (25). Here, the savings were estimated to be over $60 per plant, but the figures rose when the additional savings from EDI per vehicle, amounted to over $100. This is to show what technology can accomplish and for this scenario, EDI.

Mukhopadhyay and Cooper (1993), adds that, the best way forward when it comes to technology is to evaluate a proposed project bearing in mind the impact it is going to have on the firm in terms of financial constraints.

After this, then the firm will be set to undertake any project since it will be prepared to handle any outcomes whether good or bad. Matters like these have seen IT investments come under scrutiny making some firms shy away, which should not be the case. Instead, firms should be eager to employ projects revolving around IT.

Over the years, studies have shown positive IT impacts on firms that have implemented one or more systems. For example, valve manufacturing sectors have identified huge production gain for using transactional IT in their logistics (Weill 1992, p, 88).

Although the author continues to say that the same impact was not felt for the strategic or informational (IT infrastructure) systems and this is to say that a little change needs to be adjusted for great impact to be felt. Nothing is perfect so changes are prone to be undertaken once in a while to ensure perfection.

More so, manufacturing sectors have continued to enjoy intermediate variables from IT systems. (Barua & Lee 1997 p,140) This sector has seen massive changes of inventory turnover, capacity utilization and product quality. (Barua et al, 1995 p,144).

Apart from such sectors, other firms have also realized the huge benefits achieved once a technological device is introduced in the business, for examples hospitals. It may be costly at first, but later on the initial investment of that system is recovered within a short time, proving that it is a worth while maneuver.

Current Impact of IT in Hospitals

Reports continue to show that medication errors have become so prominent in the recent years. This means that the patients are placed at a greater risk, much risk than they were before they ever visited such hospitals. In fact, the frequencies of these errors have thus received much attention just like the airplane and automobile crashes that normally occur.

However, with the right systems in place, such cases will be unheard of and operations will be handled smoothly and efficiently, hence saving lives in the long run (Bates et al, 1993 p, 290). With respect to that, cases of malpractice litigation will also decrease a great deal (Brennan et al, 1991 p, 370).

A study was conducted recently in a time period of three years from different hospitals. The study was mainly done so as to establish the impact of IT investments in this sector and favorable results were the major outcome only after implementation of the right systems.

Hospitals that did not invest in IT had to watch, as their fellow hospitals enjoyed the impact of non financial outcomes such as customer satisfaction and quality, which are continuing to gain interest from all sectors. However, such benefits are usually determined over a period of time; the move is worthwhile, even if one has to wait for sometime (Devaraj & Kohli, 2000 p, 53).

There are numerous technologies that can be implemented in these hospitals. Benefits for some can be known there and then, as opposed to others as described above. The popular ones include; computer side physician order entry and computerized physician decision support.

These two systems especially have been found to offer a great service of improving drug safety. They have been tested thoroughly and proven fit for use in hospitals. In the past, some hospitals had problems with drug safety, but after the system was launched into the industry, things have taken a positive route. Hospitals can now boost around, knowing that their patients are safer than before. (Kaushal & Bates 2002 p,265)

Also noted by Kaushal & Bates (2002 p, 265) is that there are more innovations designed solely for use in the hospitals and most are designed to undertake critical procedures meaning that they are relied to do critical jobs which were normally done by qualified physicians.

However, before such systems are released, numerous tests are normally done to ensure that they are reliable. More of these innovations include automated dispensing devices, using robots to fill prescription, computerized administration record and automated dispensing systems, which have been proven to reduce errors in the administration time, and dose omissions (Kaushal et al 2004 p, 345).

All these innovations are targeted towards reducing errors where patients are concerned. For example, a computerized physician order entry (CPOE) is a program used by the physicians for writing orders on an online event; this system has the biggest impact in this industry as far as medication error reduction is concerned. In general, it improves safety of orders in a number of ways.

First of all, the order in question will appear in a structured manner hence displaying a route, a dose and a frequency as per its nature (Classen et al, 1991 p, 2848).

In addition to that, the orders are easily identifiable hence resulting to them being provided to the orderer during the required process. In that event, the orders can be checked for any problems such as overly high doses, drug-laboratory problems, drug interactions among other issues.

Such anomalies can be detected within a short time and the appropriate action taken, thanks to the CPOE. Hospitals that have adopted this system have seen a reduction in errors when compared to the previous years. The system functions without being provided with much decision support.

Bar coding is another technological device that is used at present time in almost all hospitals. It is used for dispensing drugs thereby minimizing errors that could have been initiated by the hospital attendant.

Other than being employed in the hospitals, industries have also decided to use it since it is efficient and reliable. However, the device has a few drawbacks since it requires one to use the keyboard as the entry point. Even with such setbacks, the system has found its way in major hospitals across US, because its advantages outweigh the disadvantages.

With regard to US, there have been successful implementations of bar coding in many hospitals. For example, the Concord Hospital in New Hampshire, the device was associated with a fall of 80% in errors. This saw an increase of more implementations being conducted in that year after this case was announced.

According to the author (Bates 2000 p, 789), more of these advances need to take place so as to meet the needs of patients who rely on such systems. When compared to humans, the systems can be relied on since they are not prone to fatigue as humans do, hence risking the lives of the patients whom they are supposed to care for.

Another technological innovation for the hospitals includes the robots that are used for filling prescriptions. The automation has been rated as the ideal device for reducing error rates when prescriptions to the patients are being issued.

They are employed both in the large and smaller hospitals since they have become quite affordable. Other than that, they have also seen their way into the outpatient settings where they have been implemented. A study on this robot was found to reduce error rate from about 2.9% to 0.6%. (Weaver & Perini 1998 p,98)

Another case study was done on the automated bedside dispensing machine, proving that it can be relied on. This study was done on 32-bed surgical unit in one of the major hospitals. The system was known as McLaughlin Dispensing System, and was situated at each patient’s bedside. In addition to this, there was a locked cabinet, which needed to be programmed electronically so that the acting nurse could get access to the doses when required.

This mechanism was more of a decentralized system. For sometime, the experiment saw nurses being observed as they administered the medication for both the day and night shifts. This was meant to ensure that all details regarding the system had been recorded so that judgment can be reasonable and true.

Amazing results were established as far as the mean error rates were concerned. To be precise, 10.6% was the results for the experimental system while 15.9% for the control system. Ideally, wrong time errors were the major events that occurred during that time. The findings also established that there was no work loads on any nurse that was present during that experiment. The major conclusion was that, the automated dispensing system was ideally the best option since it reduced errors in dose omissions as well as in the administration time.

More technological systems that have been helpful in hospitals include the automated devices, which are used to hold drugs on a specified location and then dispensed to the intended patient (Barker et al, 1984 p, 1354). This system works even better; when linked with a bar coding device then attached to the designated hospitals information systems.

With such combination, the device can dramatically reduce all medication errors within a short while. However, such links may cause unclear outcomes or even increase medications errors (Cullen et al, 1995 p, 543). Such incidences can be rectified easily when detected.

Systems such as, computerized adverse drug event detection is normally used to monitor how a certain process is progressing. It generally measures the outcomes of a certain process as explained above. The system can hence detect signals, such as a high concentration of the drug that has been used or any event of that nature. With such notifications, the pharmacy can then be able to evaluate the incident and then take appropriate steps. More so, the event witnessed can also act as a guide for determining the root cause of such a reaction.

Future Impact of Technology in Hospitals

According to Bates (2000), future medical systems will be very intelligent requiring less supervision. He adds that a physician will only be required to write orders through an online interface and get immediate response regarding a certain ailment, such allergies.

With such information, the physician will be able to choose the ideal remedy with the help from a decision support system, after this, the order will be generated automatically to the pharmacy through the internet. Such an event will be filled by robots while complex orders will only be filled by the pharmacist.

Systems for the future will also ensure that the pharmacist gets clinically oriented tasks while at the same time he or she will be focusing on promoting optimal prescription. More so, the pharmacists will be required to identify and solve problems that cannot be undertaken by the intelligent system.

Therefore the automated dispensing device will be used by the nurses while issuing drugs to the patients. All entities such as drugs, patients and staff at the hospital will be bar coded so that the management or the one in charge will be able to determine what drugs have been dispensed, to which patient, by which doctor and when. All in all, the future systems will be very intelligent requiring little or no supervision.

To add on this is that, these systems will relieve pressure from the various hospitals attendants who include nurses, pharmacist and others, who are always required to be present through out.

More so, these people will be dispensed to other procedures where their services would be more demanded. With such proceedings in hospitals, numerous undertakings will therefore be conducted in an efficient and reliable manner hence ensuring that the patients are placed under great care, thanks to the technological advances in this business sector.

Conclusion

As described here in, technology has a lot to offer in all business sectors. Manufacturing industries have been engaging in technology for many years and this explains why they are ahead in all their logistic undertakings. They are able to accomplish complex procedures within a short time and getting their productions at the end of the day.

The same case is happening to hospitals since the systems have proved viable in eliminating errors which could risk the patients in turn. On that note, hospitals attendants are relieved some of their work; as it is seen that the systems can work on their behalf.

In general, technology is the way forward for any business that wants to attain a competitive advantage over its competitors. This however, requires the right system in place for the results to be attained.

Therefore, companies should work towards getting the ideal IT experts, who will be in change of directing such moves for attaining that edge. More so, the systems need to be maintained by these experts so as to ensure accuracy when being used. With such measures in place, hospitals, manufacturing sectors and other firms will experience a well deserving comfort at their respective premises.

References

Barker, K, Pearson R, Hepler C, Smith W and Pappas C (1984) Effect of an automated bedside dispensing machine on medication errors. American Journal of Hospital Pharmacy, Vol 41, Issue 7, 1352-1358.

Barua A and Lee B (1997) The information technology productivity paradox revisited: a theoretical and empirical investigation in the manufacturing sector. International Journal of Flexible Manufacturing Systems, 9, 2 145-166.

Barua A, Kriebel, C.H and Mukhopadhyay T (1995) “Information Technologies and Business Value: An Analytic and Empirical Investigations,” Information Systems Research (6:1) pp, 1-24.

Bates, D (2000) Using information technology to reduce rates of medication errors in hospitals. British Medical Journal 320:788-791. USA

Bates DW, Leape LL, & Petrycki S (1993) Incidence and preventability of adverse drug events in hospitalized adults. J Gen Intern Med 8: 289-294

Bharadwaj A, Bharadwaj S, & Konsynski B (1999) Information Technology Effects on Firm Perfomance as Measured by Tobin’s q. Management Science Vol. 45 No6

Brennan T. et al., (1991) Incidence of adverse events and negligence in hospitalized patients. Results of the Harvard Medical Practice Study 1. The New England Journal of Medicine Volume 324:370-376

Brynjolfsson, E., and Yang, S (1996) Information technology and productivity: a review of literature. Advances in Computers, 43, 179-214.

Butters, S., and Eom, S (1992), Decision support systems in the health care industry. Journal of Systems Management, 28-31.

Classen DC, Pestotnik SL, Evans RS, Burke JP (1991) Computerized surveillance of adverse drug events in hospital patients. JAMA; 266: 2847-2851

Cullen DJ, Bates DW, Small SD, Cooper JB, Nemeskal AR and Leape LL (1995) The incident reporting system does not detect adverse drug events: a problem for quality improvement. Jt Comm J Qual Improv 21: 541-548

Devaraj S and Kohli R (2000) Information technology payoff in the health-care industry: a longitudinal study. Journal of Management Information Systems Vol 16, Issue 4, P41-67. NY

Kaushal R and Bates D W (2002) Information technology and Medication Safety: what is the benefit? Quality & Safety in Health Care 11(3): 261 – 265

Kaushal R, Shojania K. G. and Bates D. W (2004) The Safety of Computer-Based Medication Systems. Arch Intern Med, 164(3): 340 – 340.

Mukhopadhyay T and Cooper R.B “(1993) A Micro-economic Production Assessment of the Business Value of Management Information Systems: The Case of Inventory Control,” Journal of Management Information Systems (10:1), Summer pp. 33-55

Verity, J.W (1994) “Truck Lanes for the Info Highway,” Business Week.pp. 112-114.

Weaver, P. and Perini, V. (1998) Robots for filling prescriptions. American Society of Health System Pharmacists, Vol 256 (52-62).

Weill, P. (1992) “The Relationship between Investment in Information Technology and Firm Performance: A study of the Value Manufacturing Sector,” Information Systems Research (3:4) pp 307-333

Click Here To Order Now!