HR Column
The Digital Era of Governance
Information Technology is at the heart of the modern economy and at the heart of the modern corporate organization. The mammoth nature of the information and research relating to this contemporary era of what I term ‘digital governance’ cannot all be contained in this piece. However, a summary of how Information technology affects corporate governance would be discussed further to provide a fair knowledge of how this important phenomenon is helping businesses compete fairly and efficiently.
Digital governance has emerged, in today's business environment, as a central support for effective corporate governance. Companies that have strong digital governance processes in place are more capable of attracting investors, winning public confidence, and building organizations that will enhance shareholder value.
Statistics and research indicate that more businesses are likely to fully automate their operations in the coming years to drastically reduce work-load and make operations more effective.
Corporate governance involves the set of systems, principles and processes by which a company is ruled. They provide the guidelines as to how the company can be directed to fulfill its goals and objectives in a manner that adds value to the company and is also beneficial for all stakeholders in the long term. Stakeholders in this case would include everyone; board of directors, management, shareholders, customers, employees and society. But how does the marriage between digitalization and corporate governance work? Information Technology plays vital roles in corporate governance firstly by;
Making Operations more Effective
Information technology provides companies with the ability to process large amounts of information and do so in a clear and concise manner to employees. Anticipated benefits of implementing an information technology system include improvements in productivity, better profit performance, and a higher degree of accuracy among information within the firm. Information is the lifeblood of complex industrial societies and it is growing in importance. The personal computers have marched into the office, where new information technology is replacing paperwork and improving productivity, customer service and satisfaction. Productivity typically improves in organizations which implement information technology. Data integrity is greater when companies take advantage of the benefits that information technology offers.
The worlds of banking, retailing and financial services are being transformed by information technology. Every type of commercial service or public utility has been touched by the new technology.
Product Innovation with Information Technology
Information Technology is providing firms with unique opportunities for product innovation. In many industries, from automotive to consumer electronics, information Technology is being built into existing products to enhance their value. In other industries, such as banking, insurance, and consulting, the technology is providing development and delivery vehicle for new service-based products. The technology provides an important means for differentiating existing products and developing newer and unique ones.
Performance measures:
The advent of information technology has helped to put structure around measuring business performance and employee performance. One popular method involves instituting an Information Technology Balanced Scorecard, which examines where IT makes a contribution in terms of achieving business goals, being a responsible user of resources and developing people. It uses both qualitative and quantitative measures to get those answers.
Anticipated benefits of implementing an information technology system include improvements in productivity, better profit performance, and a higher degree of accuracy among information within the firm. Specifically, a firm may be able to improve this portfolio by taking advantage of structural changes made by new technology in its corporate governance. In the digital era of governance therefore, being in a strategic position to compete efficiently has become the order of the day.
In a nutshell, all firms have to find a way to marry InfoTech with their corporate governance strategies or risk not being competitive enough and hence not meeting shareholder expectations; jeopardizing the performance of the business.
Collins Senyemi, HR Assistant, Fanmilk Ghana