The influential evolutionary models of IT growth in the organisation, for example, Gibson and Nolan (1974) and Nolan (1979) offered a useful starting point for understanding IT assimilation, but they had little to offer in terms of guidance on how to identify strategic information systems opportunities. Whitmore (1985) went so far as to say that their continued use as guiding frameworks through into the early 1980s had actually inhibited the strategic use of IS/IT. Their predictive capability did not extend to the new technologies and new applications, which quickly became available. Organisations, struggling to keep pace with these changes whilst at the same time trying to forge links between isolated areas of automation based on different technologies across separate functions, found that the transition to integration was now much more complex than that described by these early evolutionary models. Their focus was on ?the development of DP/IS management? rather than ?the exploitation of DP/IS in the enterprise? (Ward, Griffiths and Whitmore, 2003). Subsequent research and theorising through the 1980s has produced models of IT which focus more clearly on why the movement from automation to integration was so difficult; its crucial importance as a platform for transformation; and, in view of the great costs and timescales involved, the need for flexible strategic planning. For example, successive refinements of the Three Era model (DP, MIS, SIS), three-role model of IT: automating, informating, transforming; and the MIT90s models, in particular Venkatraman's (1991) five levels of IT-induced business transformation model, were especially useful. Since the transition involves a fundamental shift in emphasis from managing computers to managing information systems, they highlight the importance of a clear understanding of the nature of information and the current and future information needs of the business and the organisation in relation to the competitive environment. They also emphasise the need for a more holistic view which takes in all aspects of the organisation, its environments, the IT/ IS applications and their interrelationships.
The terms used; ?shifting through stages, eras, phases, or levels? of IT use and development; suggest an ordered progression, a time-based sequence of events, which is regarded as problematic in these models as in the earlier models. However, most stress that their intention is to indicate a phased expansion of the focus of concern to include another area of IT/IS activity rather than a staged change from one activity to the next. The MIT90s research summarised the main challenge to management in the 1990s as: the creation of flexible organisational structures which would enable companies to deal with an increasingly fast-changing, complex and competitive world. Information technology which enables the integration of business activities would play a key role as it could be used in the development of new structures which would facilitate the communication and flow of new ideas, and in the development of new business opportunities.
It stressed that the shift to this kind of organisation would be difficult because it involves changing long-established business processes, IT systems, structures, strategies, roles and cultures. Achieving a successful transition to IT-enabled business transformation would require not just the technological know-how to develop a robust IT/IS infrastructure but also an understanding of the dynamics of change as it affected all aspects of the organisation and its external environments. It highlighted the need for skilful management of the change process and investment in people, pinpointing the failure to provide these in the past as root causes for the lack of impact of IT on economic performance and productivity. The MIT90s Research Framework emphasises the central role that management processes (strategic planning, budgeting, resources planning, etc.) play in the alignment of business and IT strategies in the organisation, and in maintaining organisational equilibrium. Every component is influenced by external and internal environments, and changes which affect one, affect all. Changes made in one area without consideration of their likely effects on the others upset the ?dynamic equilibrium? and threaten survival and growth.
Determining the right pay entails combining the results of the job analysis and job evaluation processes and market pay data. Although the pay levels within an organization reflect external competitiveness and internal equity considerations, the decision on the final pay level - the organization’s pay policy will be determined by many factors, including competitive strategy, HR strategy, reward objectives, organizational design and culture (Armstrong & Stephens 2005). The pay model shown in Table 1 serves as a framework for examining current pay systems and it involved three basic building blocks: compensation, policies that form the foundation of the compensation system, techniques that make up the compensation system.
Reward policies provide guidelines for the implementation of reward strategies and the design and management of reward process. Basically, every employer must obey four major policies (White & Druker 2000): internal alignment, external competitiveness, employee contributions, management of the pay system.
Internal alignment refers to comparisons among jobs or skill levels inside a single organization. Jobs and people’ skill are compared in terms of their relative contributions to the organization’s business objectives (White & Druker 2000). How, for example, does the work of the programmer compare with the work of the systems analyst, the software engineer, and the software architect? Does one contribute to providing solutions for customer and satisfying shareholders more than another? Internal alignment pertains to the pay rates both for employees doing equal work and for those doing dissimilar work. In fact, determining what is an appropriate difference in pay for people performing different work is one of the key challenges facing managers.
External competitiveness refers to compensation relationships external to the organization: comparison with competitors (White & Druker 2000). How should an employer position its pay relative to what competitors are paying? How much do we wish to pay accountants in comparison to what other employers would pay them? What mix of pay forms- base, incentives, stock, and benefits- will help achieve the compensation objectives? Increasingly, organizations claim their pay systems are market-driven, that is, based almost exclusively on what competitors pay. However, “market driven" gets translated into practice in different ways. Some employers may set their pay levels higher than their competition, hoping to attract the best applicants (White & Druker 2000). External competitiveness decisions-both how much and what forms- have a twofold effect on objectives (White & Druker 2000): 1.To ensure that the pay is sufficient to attract and retain employees if employees do not perceive their pay as competitive in comparison to what other organizations are offering for similar work, they may be more likely to leave, 2.To control labor costs so that the competitiveness directly affects both efficiency and fairness. Also, it must do so in a way that complies with relevant legislation.
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