Technology-Based Management of Service Companies
The manual system of management was for a very long time in use in the management of companies. This was before the existence of technology and technology based platforms. Inefficiency was the order of the day during the era of manual systems of managing companies. The change was instant after the discovery of information technology.
There are two broad groups of companies in the world. First there are companies that deal with tangible goods. These companies actually manufacture or trade in goods such as cars, industrial goods and others. The second category consists of companies that are service related. These companies actually sell services to their clients.
The management of service companies is slightly different to that of companies that deal with tangible goods. The difference is more visible when it comes to employing information technology within the management structures. In order to fathom the difference with clarity, let us use the case of an audit firm as a case example.
Auditing is the main area of business for all audit firms in the world. Since auditing does not involve transfer of goods, the technology based system used to manage it is only responsible for tracking the flow of services as required by the client. Information Technology mainly works by the use of software. The software must be designed in such a way that it facilitates the work of the specific company that requires it.
IT managed service companies usually use software that allow for different operations on a technology based platform. Among the most important functions of software used by service companies is data storage. Storage of service information can be tricky and that is why it must be stored in computerized systems. Goods could serve as storage of evidence and information when it comes to companies trading in tangible goods.
The second type of software used by IT managed service companies is the networking software. When in the service industry, it is important to have a system that keeps track of different steps of transactions. For instance, an audit firm would naturally be divided into departments that handle the different levels of auditing. In many situations, audit firms start with the in-depth analysis of financial statements and balance sheets of the company under audit. This could be followed with analysis of taxation and remuneration matters. Finally the entire audit process will be concluded.
All the steps to be followed in ensuring flawless running of the different steps of a service company can be well managed using software. The software serves to ensure that efficiency is at its highest level. Researchers posit that the use of Information technology could boost efficiency of the company by over 50%. There is then an obvious positive correlation between this efficiency and the eventual financial performance of the company.