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  • Published on: 14th September 2019
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The Role of Information Management in Provision of Digital Services


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Businesses are fast turning into digital organizations. This is because of the promising potential of online business in the contemporary society. Technological advances have enabled firms to enhance their efficiency and at the same time facilitating convenience among customers. The fact that technology plays a role in the changes and advancements of businesses, it is of essence that business owners ensure technological currency in their businesses. This implies that companies need to be updated with trends and use that effectively in enhancing their performance. This paper provides an analysis of the role of information management online businesses with specific reference to Netflix Company. The study shows that information management is a crucial element in organizations. Firstly, information management is defined as the delicate process of collection, sharing, and monetization of that information where it is relevant. This information is used to better the experience of customers as they interact with organizations and consequently competitive advantage of the businesses.

The Role of Information Management in Provision of Digital Services


Trends in the contemporary business environment show that every enterprise has turned into a digital organization. Business organizations have turned on holding their information along with digital currency as critical assets in enhancing competition (Scott 2010). Management of enterprise information is therefore tasked with ensuring that focus is on information lifecycle that is essential for productivity and competitiveness of businesses. For instance, a business cannot impress their customers by enhancing the digital experience without access to digital information. Additionally, access to digital information is necessary for improving process automation. These changes in the business world are what is called digital transformation. The digital transformation is very dependent on information management in organizations that work to enhance their competitiveness (McKnight 2014). This is the case with Netflix Company, which has shown efficiency in information management and consequent success in the digital world.

Consequently, businesses need to get information management right to be able to make impacts in their industries and the global arena. In addition to digital currency, information management is also closely tied to people in the internal and external business environments (Scott 2010). A massive amount of data is produced through interactions between people in various lines and process in the business environment. Data generated during interaction between people present organizations with insights and sources of innovation. This highlights a relationship between processes, the flow of information, people, and technology, which act together to enhance an organization's digital currency and resultant competitiveness. Therefore, information management in the organization setting can be defined as the process that entails identification, optimization, storage, provision, and usage of strategic information to enhance a business' competitive advantage.

Enterprise Data as Sources of Insight and Value

Many business organizations across the world have turned focus in analyzing the large chunk of data that submerge businesses with the aim of gaining insights. As McKnight (2014) explains, in addition to the structured and unstructured data, a continuum that is made up of people, information, technology, processes, and how they relate is available. Information management, therefore, requires information management systems in place to make meaning and effectively use the information generated by businesses. The need for effective information management systems has seen the rise of artificial intelligence, machine learning, and deep learning. Such technological advances have enabled organizations to acquire intelligence from information and enhance predictive and prescriptive analytics for making better decisions in an organization.

Information as a Business Asset

The fact that information is an asset in business is the underlying reason responsible for digital transformation and digital disruption (Haag and Maeve 2008). From the perspective of business, information is the greatest asset. Enhancing an information-rich environment is an important aspect of business in the contemporary world. Businesses work to ensure that their employees, top management, and customers access the information that they need for efficiency. Access to relevant information as noted above is essential in decision making especially in making informed decisions in the business environment. However, effective management of information in the business setting demands rather strategic approaches that have people and process at the baseline.

At this point, information management can be understood as the delicate process of collection, sharing, and monetization of that information where it is relevant. However, it is worth noting that the insight gotten from the information is what is more important compared to the information itself (McKnight 2014). Additionally, organizational data are essential for gleaning transformative insights from. Businesses, however, need to know where the data is for them to retrieve insights from them. Therefore effective information management systems need to enhance the visibility of data, access to information, and the ability of an enterprise to take action. Information management and related systems are key in the breakdown of the extensive data into forms and formats that are easily understood for action.

The Case of Netflix

Netflix is one of the known companies worldwide whose digital transformation aided by information management has enabled to survive tough completion. Being in a highly competitive business environment, Netflix was destined to fail according to the prediction by critics. According to Barker and Myc (2017), the old books of management would have predicted the fall of Netflix. In fact, JP Morgan Securities downgraded the company's stock in 2007 citing intense competition (Haag and Maeve 2008). Almost everyone in the business world predicted that the company would be unable to make a second impact primarily because it was based on mail business, which was gradually but steadily being faced out. The company's method of distribution was slowly being outdated as online streaming of movies took its place.

However, thanks to organizational data and analytics, Netflix has been able to survive competition through enhancement of its capabilities and customer experience. For instance, through information management, Netflix has been able to develop ‘Cinematch,' a recommendation engine, which enables the company to predict the pattern of DVD requests among customers (Barker and Myc 2017). In addition, the company even had in place open contests where anyone who could help to enhance its algorithm wins a prize of one million dollars.

Netflix had the option of continuing down the same trajectory that it has in the 20th Century but it did not. By the year 2009, Netflix had more than one hundred thousand DVD titles and more than ten million subscribers (Haag and Maeve 2008). This was quite a performance already by this time. However, the company applied information management in what is called as predictive and prescriptive management to get into the digital business arena: what could not be seen by other competitors like Blockbuster. The company put focus on logistics and analytics as part of the strategy to stay relevant and edge competition from other video rental companies. This kind of disruption and transformation could not be seen by competitors including Blockbuster who turned down an opportunity to acquire Netflix in 2000 (Haag 2004).

One of the major insights that Netflix got from its information management strategy is the need for online video streaming among its customers. Through venturing into the online video streaming, the company has been able to attract more customers and consequently grow its business. For example, by the year 2016, Netflix had attracted more than ninety four million subscribers into its online streaming services (Barker and Myc 2017). The number of subscribers of the online video streaming were even projected to increase in the subsequent years because of the fast growing popularity of online video streaming, what has come be known as “Binge Watching.”

The introduction of “Binge Watching,” which entails the act of watching full episodes of newly released series has changed the movie and entertainment world (McKnight 2014). This has made Netflix to attain the status of a defacto entertainment on the internet since it allows access to its collection through mobile phones, tablets, and computers.

Technology and Data Analytics

The transformation of Netflix in the entertainment industry can be viewed from various angles. The first angle is the role of technology while the second is the role of data analytics in enhancing competition of the company in the contemporary business world. The technological angle is where the company worked with Amazon to establish a back-end infrastructure with world-class status. The coalition between the two companies enabled Netflix to deploy many servers and storage space efficiently.

The decision by Netflix to work with Amazon was quite controversial according to many who thought it would not work. This was because the Amazon is a major competitor of Netflix because it also has a video-on-demand platform that enabled users to stream and download various movies from the available collection (Barker and Myc 2017). However, Netflix did not shy away from working with competitors. The decision to choose the second best company, in this case, number two after Amazon, would not have delivered the same results that the company is currently enjoying.

The second angle, through which one can assess the success of Netflix in the movies and entertainment industry is through the information lens. Here, the company has through time worked to collect detailed data that has enabled it to know its clients at personal levels. Knowing customers at the individual level has further enabled Netflix to understand their preferences thus being able to shape the company's recommendation engine to help customers have what they want easily (Doom 2013). These changes have shaped the company in a way that everything that is given to the clients is recommendations. Therefore, the company has been able to enhance its personalization capabilities that further adds to its recommendation engine, which is data rich.

The personalization capability that arises from the data and information-rich business environment cannot be overemphasized. Netflix's personalization entails videos arranged horizontally on the homepage (Barker and Myc 2017).  Each group of movies is under a title that indicates the connection among them. Through personalization, Netflix can select the groups and items under each to meet the needs and preferences of each customer. Furthermore, the process of personalization is done through machines at speed and scale.

Apart from Amazon, Netflix has also been able to forge other relationships with other international companies like Facebook. This is with the aim of increasing the experience of customers as they search and stream content that they need. Scott (2010) explains that data from Facebook has been quite useful to the company especially in establishing a powerful recommendation to customers. This is with specific reference to the ability to add preferences of customers' friends in Facebook to improve on the ability of the company to refine its recommendations to its clients. Through such partnerships and endeavors, the company has been able to offer personal results to its customers that are aided by data and analytics.

Netflix is one of the few companies that have established and applied information advantage to leverage performance and outdo competitions. For example, based on the relevant data and analytics, the company has been able to place accurate bets on licensing various movies and TV shows that have enabled it to make a kill in the entertainment industry. An instance of this is the licensing of the series “House of Cards.” This was facilitated by the bid data and analytics that has now become a major strength of the organization. Since the company has a well-established data and information-rich environment, it can tell when a series would be watched or not. This was the case of the series “House of Cards” and “Orange is the New Black” where Netflix analyzed its data and realized that the movies would be loved and widely watched by audiences (Barker and Myc 2017).

The transformations of the business model at Netflix can be used to predict where the company will be at soon. Some of the significant things that need to be noted in the core priorities of the business are the application of technology and information advantage to drive change in its business model. For example, some of the changes that have been seen in the entertainment industry concern televisions. The old linear television is being fast replaced by internet televisions that have necessitated the need for apps instead of channels. In relation to the advancement of technology in televisions, Netflix has moved with speed to have in place an app that has shown some good results (Barker and Myc 2017). Netflix has been able to establish a leading app that enables its customers to stream their video content through various devices including tablets, computers, and smartphones. Consequently, it can be predicted that Netflix will bring about various changes in the television world. For instance, the company will be able to have in place personalized recommendations to replace the standard TV guides.

Conclusively, through the information advantage that the company has been able to establish through time, it can be predicted that the company will be able to design and implement contextual recommendations that would make the customer experience even better. For example, this would be supported by information about searches related to the time of the day, location, device, and day of the week. The changes concerning contextual recommendations are expected to be implemented by the company soon. This can be proved from the company's record in collecting data, interpreting it into relevant information, storing, and making it available for use by the company. Through this, the company is expected to perform better in future and compete well with competition.

Individual Reflection

As seen in the case of Netflix Company, past success is not a guarantee to succeed in future. The company understood the need for innovation and transformation to remain relevant in the highly competitive business environment. Netflix decided to abandon its traditional business model that had already proved to be successful in adopting a new strategy with the aim of making the company's performance even better. Such bold moves in business can only be made by companies that recognize the essence of information management in enhancing competitiveness and performance in the business environment.

Therefore, it is essential to have information management as an essential component of the business process. Information management, in this case, entails tapping of relevant user data, interpreting the data into meaningful information, and using the information strategically to better the experience of customers and resultant performance of the business in the market. This is especially important in the online business that is transformed and interrupted by advancements in technology.

It is through information management aided by technology that a business can reverse engineer their content and provide them to customers in a way that best meets the demands and preferences of customers (Scott 2010). Top management in various organizations should, therefore, be aware of the role played by data gathered during their interaction with customers in enhancing their experience and competitiveness in the business environment. For example, as can be seen in the case of Netflix and changes in Hollywood, businesses should have systems in place to find out how they are using the products or services, the manner of organization, and the brands that are liked by the customers. This is the best way of improving organizational processes and performance among the competition.

To sum it up, marketing of business' products entails having the attention of customers, improving customers' loyalty to a brand, and improving sales (Scott 2010). The most accurate way of doing all that is through the application of a model same as that of Netflix. This involves establishing solutions to manage content, which act to streamline content from the point of creation through to the instance of usage in organizations to enable them to compete effectively. However, the most challenging thing in all this is the management of the process of collection of data and interpreting them into useful information. This has done many businesses that strive to enhance their information management capabilities to fail despite having the data that they need. However, this will be soon solved through technological advances like the artificial intelligence, self-learning, and content analytics.

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