The Roles and Responsibilities of Information System Department:

A Case Study in Publication Firm

By: Salasiah Rashidi

Faculty of Information Management

Abstract

This paper seeks to assess the roles and responsibilities of Information Technology
department at publication firm. The roles of IT an organization adopts affects the
relative proportions of the various type of IT investments, similarly the
responsibilities of IT can be examine through the impact of IT/IS on the organization
performance and competitive advantage. The study shows that the IT department
does play an effective roles and responsibilities for the organization.

Keywords: Information technology; IT investment; Roles of IT; Competitive

Advantage

1.0 Introduction

Since mid of 1980s, the process of producing magazines and newspapers has been
transformed by the adoption of computer-based technology and Internet into the
industry. The impacts of information technology (IT) have introduced mass usage of
microcomputers and software applications as well as changed working and
organizational practices across the publishing industries. According to Butler and
Murphy (1999), IT plays important role in the manner in which publishing firms
gather, process, store and embed their informational resource in printed products.
For instance, the introduction of desktop publishing integrated software has enabled
a single worker to performed many tasks (layout design, typesetting and final
printing) that had previously been undertaken by specialist. These developments
reduced the lead-time required to produce a magazine and enable relatively any

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organization to be competitive. In general, the publishing companies have to adapt
to technology changes and continue investing in technology to help them develop
innovative products for competitive success and maintain competitive advantage
among each other’s.

Large amount of resources have been and will be continue be invested in

information technology. Question arise, does IT has direct impact on firm’s
performance? According to Teo, Wong and Chia (2000), firms’ perspective on the
role of IT in their organizations may influence the allocation of the IT budget to the
different management objectives, i.e. cut operating costs, gain competitive
advantage, and facilitate information access for competition. Many studies show
positive impacts of IT roles on organization’s performance and competitive
advantage. Decades back, Butler and Murphy (1999) showed that the
competencies of human IT assets played a major role in shaping organizational
character and distinctive competence. Castel and Gorriz (2007), highlighted that the
use of IT increases organization’s productivity.

In relation to this context, the author wanted to examines the roles and
responsibilities of the IT department and how are these roles and responsibilities
being carried out to support business performance and competitive advantage. The
case study – publication firm provides graphic examples of the key role that IT plays
in the commercial success of today’s publishing firms.

The paper is structured as follows: First, a short literature review is provided. In the
next section, hypotheses to test, according to previous literature reviews are
proposed. Subsequently, the variables objects of study are introduced. Then,
empirical study is carried out and the results are discussed. The last section
highlights the conclusions and discussion in related to IT roles and responsibilities
in the firm. In this study, the term ‘IT’ is used interchangeably with ‘IS’.

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 2.0 Literature Review

Prior research can be divided into studies examining the relationship of IT adoption
on firm’s performance and competitive advantage, and studies examining the role of
IT.

1.1 The relationship of IT adoption on firm’s performance and competitive

advantage

A successful adoption of IT can change a firm’s product or the way a firm competes
in its industry. Many studies present descriptive models for classifying successful
strategic adoption and for evaluating the potential of IT. For example, Notowidigdo
(1984) divided strategic use of information systems (IS) technology into internal
system “that have direct benefit to the company” and external systems “that have
direct benefits to the company’s customers,” but which indirectly benefit the
company. According to him, “Information Intelligence delivery” as offering a
competitive advantage to corporations, as well as to customer where the
mechanisms (i.e. service delivery, product delivery) provide a useful starting point
for identifying specific strategic application of IS on organization’s performance and
competitive advantage.

Understanding how IT contributes to a firm’s performance and competitive

advantage has long been of interest of IT scholars and practitioners. Recent studies
showed that specific elements, i.e. IT competencies, IT infrastructure flexibility, and
IS support are among the factors that contribute to a firm’s performance and
competitive advantage. Castel and Gorriz (2007) research showed the importance
of IT in firm’s productivity and its relationship to human resources management. In
other words, the research indicated that the adoption of IT has positive impact on
firm’s productivity with the support of qualified workers with IT competencies, and a
proactive attitude by managers toward IT. This finding was supporting previous
studied by Butler and Murphy (1999) that IT professionals with unique
competencies were seen to play influential roles by IT in developing firm’s
distinctive competence and sustained competitive advantage.

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Bhatt et al. (2010) research showed how the flexibility of an organization’s IT
infrastructure enhanced information generations, information dissemination and
organizational responsiveness. Subsequently, organizational responsiveness to
rapidly changing environments was positively related to the firm’s competitive
advantage. In this context, IT infrastructure flexibility defined as the degree to which
the IT infrastructure is scalable, compatible, modular, and can handle multiple
business applications. On the other hand, recent study by Zhang (2011) indicates
that IS support has been addressed as the factor in product innovation which can
actually lead to competitive advantage and superior firm performance (Zhang,
2011). In other words, a firm could make a product more useful or less costly by
building IS into the product or using IS to bundle more information or knowledge
with the product, to improve product innovativeness and flexibility.
.
1.2 Role of information technology (IT)

The notion that the IT function serves different roles in different organizations and
such roles may evolve over time, this phenomenon become the base of top
managements decisions as to whether they should increase their investment in and
deployment of IT resources for new product development (Zhang, 2011).

Teo, Wong and Chia (2000) examined whether the role of IT an organization
adopts, affects the relative proportions of the various types of IT investments. Their
finding showed that firms view cost cutting as a top priority and IT as a tool to
support operations, decision-making and administrative functions. The same study
also detected an increase realization on the importance of strategic IT in the
organizations in order to introduce new products/services and compete more
effectively. In the study, IT investments were classified as transactional, strategic,
informational and threshold; followed by roles of IT were classified as traditional,
evolving and integral (Table 1).

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 Table 1. IT Investment and Roles adopted by Teo, Wong and Chia (2000).

Classification of IT Investment Classification of IT Roles

Transactional: IT investment aims at cutting Traditional Role: IT supports operations,

costs by substituting capital for labor. decision-making and administrative
functions

Strategic: IT investment aims to provide Evolving Role: IT supports business strategy

competitive advantage with respect to the but is not an integral part of the strategy
firm’s competitors. formulation process.

Informational: IT investment refers to Integral Role: IT is integral to business

information infrastructure to facilitate strategy whereby IS and business
information access and communications. management work together to formulate
organizational strategies.

Threshold: IT investment refers to

investment made just to imitate competitor’s
technology level and often made regardless
of whether it has a positive return.

3.0 Description of the Organization

Kumpulan Karangkraf Sdn Bhd (Karangkraf), the largest Malay language magazine
publisher in Malaysia, is not excluded from the publishing digitalization diffusion.
Karangkraf is always strives for new media businesses and prepare for technology
challenges. The introduction of new hardware such as tablets, smartphones as well
as e-readers is creating new opportunities for the Karangkraf’s digital division to
expand its services. The highly adopting of digitalization and computer-based
technology has harness the potential of Information Technology department (ITD)
as a centralize support division to Karangkraf. Karangkraft’s vision is to be an
established publication and printing firm and distributor of magazines, books and
printed materials in South East Asia that meets world quality standards.

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The IT department is headed by the CIO, had four sub-groups; technical support,
MIS, IT administration and application support. The IT manager with other 22 IT
resources is currently supporting and maintaining 6 publishing factories and 7
bureau offices throughout Malaysia in term of IT related hardware, infrastructure
and IS applications. Some of the IS applications are in-house developed such as
Human Resource system, Production Timesheet system, Job Monitoring system for
magazine editorial, Newspaper Information system, etc. Figure 1 illustrates the
departmental function of ITD at Karangkraf.

It is important to align the ITD roles and responsibilities with Karangkraf’s business
goals. Without this, the ITD may develop incapable of providing the right support
and services to its users; and IT investment may see no positive impact on
organization’s performance and competitive advantage (Teo, Wong & Chia, 2000).

•Network Support • In-house

•System & Server development
Support Projects
•Desktop Support

Technical
MIS
Support

Application
IT Admin
Support

• IT procurement • Software
• Help Desk Support

Figure 1. Departmental Function of ITD of Karangkraf.

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 4.0 Research Model and Methodology

The conceptual model for this case study is adopted from previous literature as
mentioned in earlier section. The author hypothesized the independent variables: IT
competencies, IT infrastructure flexibility and IS support indirectly impacts
organization’s performance and competitive advantage (Figure 2) and these
variables are positively related to the importance of IT roles in an organization.

IT
Competencies

IT Roles of IT in an
Infrastructure Performance &
Organization Competitive Advantage
Flexibility

IS
Support

Figure 2. Propose Conceptual Model

4.1 Instrument

The variables indicated in the conceptual model (Figure 2) are thus defined based
on (Butler & Murphy, 1999; Castel & Gorriz, 2007; Bhatt et al., 2010; Zhang, 2011):

Organization Performance and Competitive Advantage

Organization performance refers to the positive results of activities of an
organization or investment over a period of time and competitive advantage refers
to condition which enables an organization to gain advantage over competitors by
offering greater value in term of products and services. The implementation of

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relevant IT capabilities portrays the significant of IT roles in an organization, and
eventually lead to organization’s performance and competitive advantage.

Roles of IT in an Organization
Roles of IT refer to business strategy actions encompassing three types: traditional,
evolving and integral. Studies emphasized that although IT is likely to improve
organizational efficiency, its effect on administrative productivity and business
performance might depend on the IT strategy link (which is related to the role of IT)
(Teo, Wong & Chia, 2000). Therefore, the hypothesis is defined as follows:

Hypothesis 1: Roles of IT have positive impact of organization’s performance and

competitive advantage

IT Competencies
IT competencies refers to the competencies of human IT assets (i.e. technical skills,
business understanding and problem-solving capabilities, etc.) played a major role
in shaping organizational characteristic and distinctive competence (Butler &
Murphy, 1999). Similarly, skilled IT employees allow firms to integrate IT more
effectively in the planning process of the business, to conceive and develop
applications that cut costs or improve the product quality (Castel & Gorriz, 2007).
Therefore, the next hypothesis is defined as follows:

Hypothesis 2: IT competencies have positive impact on roles of IT in an

organization.

IT Infrastructure Flexibility
IT infrastructure flexibility refers to the degree to which the IT infrastructure is
scalable, compatible, modular, and can handle multiple business applications. Top
management often rank ability to develop an efficient and flexible IT infrastructure
as their most important priority in helping their organization achieve innovation and

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better performance (Bhatt et al., 2010). Therefore, the following hypothesis is
defined as follows:

Hypothesis 3: IT infrastructure flexibility has positive impact on roles of IT in an

organization

IS Support
IS support refers to the effective IS deployment to support product/service
innovation, i.e. time saving, cost reduction and better quality of new product. A firm
is more likely to achieve sustainable competitive advantage and superior
performance through continuous development and deployment of IS to innovate
new products/services (Zhang, 2011). Therefore, the following hypothesis is defined
as follows:

Hypothesis 4: IS support has positive impact on roles of IT in an organization

4.2 Methodology

A quantitative survey methodology was used to examine the objectives of this case
study. The objects of this survey were Karangkraf’s employees who ranked from
senior executive and above, working at headquarter Shah Alam, Selangor. Self-
administered and adopted questionnaires were distributed to 50 participants. Finally
17 were returned and used for analysis, hence making a response rate of 34 per
cent. The low response rate could be due to some officers are on holiday for school
break and commitment of works.

The questionnaires of the study consist of three sections with total of 16 questions
preceded by a covering letter explaining the purpose of the questionnaire. Section A
captures demographic information such as position and division. Section B captures
information related to independence variables: IT competencies, IT infrastructure
flexibility and IS support. Lastly Section C captures information related to
dependence variables: Roles of IT and Organization’s performance and competitive

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advantage. Other than demographic information and Roles of IT, all other questions
used perceptual measures with a corresponding five-point Likert scale ranging from
1 = strongly disagree to 5 = strongly agree.

5.0 Findings and Discussion

Based on the 17 usable responses, data were analyzed using MS Excel 2010 and
SPSS version 16.0. The outputs are present in pie chart and tabulator tables. The
outputs are represented in graphical and statistical illustrations to for easier
understanding of the relationship between the variables in the instrument.

5.1 Demographics data

Majority of the respondents are

Position Manager position with 35 per cent
0% followed by Senior Executive with 29
6% Senior Exec
percent. The response from the top
29% Asst Mgr
24% management (General Manager and
Mgr
Assistant General Manager) is very
Senior Mgr
6%
Asst GM low.
35% GM
The study is still acceptable as the
majority of the respondents are from
Figure 3. Position distribution of respondents the key personnel (manager) that
handle the operations.

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5.2 Roles of IT in an organization

The analysis shows that

IT Roles
10
majority of the respondents felt
that the roles of ITD is 8
8
traditional i.e. IT supports 6
6
operations, decision-making IT Roles
4
and administrative functions. 2 3
Then followed by integral role
0
whereby IS and business Traditional Evolving Integral
management work together to
formulate organizational Figure 4. IT Roles in Organization

strategies.

In the context of IT investment,

29 per cent of respondents felt
IT investment objectives
that major objectives or
Transaction
responsibilities of IT are to cut Threshold
al
29%
operating costs and to use IT 29%
Informatio
for competition. Interestingly, nal
Strategic
18%
only 18 per cent think that IT is 24%

used for strategic plan to gain

competitive advantage over
the competitors.
Figure 5. IT investment objectives

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5.3 Reliability Analysis

According to Sekaran and Bougie (2010), the reliability of a measure indicates the
extent to which it is without unfairness and hence ensures consistent measurement
across time and across the various items in the instrument. In other words, the
realibility of a measure is an indication of the stability and consistency with which
the instrument measures the concept. From the SPSS session that the researcher
attended, Cronchbach’s alpha value must achieved more than 0.7 only then the
factor is accepted.

Therefore, reliable analysis were performed on the three independence variables

(i.e. IT competencies, IT infrastructure flexibility and IS support) and one
dependence variable i.e. organization’s performance and competitive advantage.
The result of this procedure is shown in Table 2.

Results show that the highest values in reliability analysis are IT competencies and
Performance & Competitive advantage. IS support obtains the lowest Cronbach’s
alpha value yet it is acceptable as the value is 0.764. In other words, all variables
are consistent in measuring the concept.

Table 2. Reliability analysis of research variables

Variable Number of items Reliability (Cronbach’s ‘a)

IT competencies 3 .910

IT infrastructure flexibility 3 .892

IS support 3 .764

Performance and 3 .910

Competitive Advantage

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5.4 Descriptive statistics of main variables

This section will provide descriptive statistic of 4 main variables in the instrument.
The purpose is to determine what the most selected option by respondents, for
each of the variables by computing its overall means (Table 3). The findings show
that all variables have overall mean greater than 3.0 which means the respondents
are incline to agree with the hypothesis.

Table 3. Over all mean for main variables

Variable description Overall Mean value

IT Competencies 3.35
IT infrastructure flexibility 3.78
IS Support 3.80
Performance & Competitive Advantage 3.70

In summary, it can be concluded that; the respondents are incline to agree that IT
competencies, IT infrastructure flexibility, IS support have positive impacts on roles
of IT in an organization and they also agree that roles of IT in an organization has
positive impact on organization’s performance and competitive advantage.

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 6.0 Conclusion and discussion

Results of this study revealed interesting insights of Karangkraf employees’

perception on IT department roles and responsibilities in the company. In general,
the IT department is perceived mainly to provide IT support operations, decision
making and administrative functions (traditional role), and use IT/IS with business
management to formulate organizational strategies (integral) as second. One likely
reason is that Karangkraf is focusing on its operation to maintain 5 main cores of
business sectors (book, magazine, newspaper, printing, digital); therefore outputs
and productivity are most important compare to strategy to compete with
competitors. Previous finding is consistent with the result of IT investment objective
where most of respondents felt IT investment goals are to cut operating costs
(transactional) and to use IT just to imitate competitor’s technology level regardless
of it positive return (threshold). In other words, the company focuses on managing
its current expertise more effectively and gives very little thought to long term
strategic planning.

In general, IT department has seen to deliver it roles and responsibilities effectively.

The study showed that most of the respondents positively agree that IT department
has the technology competencies, flexible infrastructure and reliable IS support
levels. The main managerial implication from this study is that the company should
continue to invest in and deploy IT competencies, infrastructure flexibility and IS that
support product innovation in gaining higher performance and effective productivity.
In addition, the company can leverage these capabilities and capacities to gain
competitive advantages to compete with the competitors.

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 Reference

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information in dynamic environments: The role of IT infrastructure flexibility as
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Butler, T. and Murphy, C. (1999). Shaping Information and Communication

Technologies Infrastructures in the Newspaper industry: Cases on the Role of IT
Competencies. ICIS ’99 Proceeding of the 20th International Conference on
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Notowidigdo, M.H. (1984). Information Systems: Weapons to gain the competitive

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Sekaran, U & Bougie, R. (2010). Research Methods for Business: A Skill Building
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Teo, T. S.H., Wong, P. K. & Chia, E. H. (2000). Information technology (IT)

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