Information Technology has emerged as a basic fact of life in the business strategies of major corporations. Information Technology facilitates the convergence of communciations, computers, and information. Although Information Technology has traditionally been focused on internal operations (e.g., administrative and backroom functions), its emphasis is increasingly shifting to external operations and creating connections that benefit the customer. No industrial sector will be more profoundly affected by this trend than the financial industry.
Business analysts agree that Information Technology is much more important today than it was in the past. At present, companies typically spend about 6 percent of their total revenue on Information Technology. This expenditure is expected to grow to almost 9 percent by 1999 (Haapaniemi, 1996, p. 24).
The United States is the leader in the Information Technology movement. Of the top 20 Information Technology companies worldwide, half are American. These companies include: IBM, Hewlett-Packard, Digital Equipment, EDS, Apple Unisys, Compaq, AT&T, Sun Microsystems, and Microsoft. Of the top 100 Information Technology firms worldwide, only 28 reduced their staff numbers for the five-year period between 1988 and 1993 (OECD, 1995, p. 36).
A case study of how major corporations are using Information Technology is Alcoa. In November, the company announced a $150 million joint venture, called the Common Infrastructure Initiative (CII), with Microsoft and Hewlett Packard to build its own information superhighway. Alcoa has more than 15,000 computers in its system. The need for a common corporate infrastructure became apparent when Alcoa found itself with eight different E-Mail systems operating from its 22 business units. Achieving commonalities of technology will allow Alcoa managers to focus on competitive issues as opposed to software and hardware decisions. As one Alcoa execu...