Information+Technology+and+ICT


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=Section 2: Business information and ICT=

Businesses need good information in order to make good decisions. Without information a business would not be able to function.
 * Introduction **

It may be useful to think of information as being the blood pumping round the body of the business.Without it the business will not survive; if it is not good quality the business will not survive; a healthy business needs good information.

Here are some definitions:

Collections of facts or quantities, which have been put together in some way.
 * Data**

Data that has been processed in a way that helps people make decisions and plan for the future.
 * Information**


 * The ‘Information Age’ **

Electronic and computer technology has allowed us to access huge amounts of information for business and personal use. The internet is the most obvious example.

Where the information comes from will influence how useful the information is. It is also important to be aware of the type of information so that you know best how to use it.
 * Sources of information **

There are two main types:

This is information which is mostly number based. For example ‘Sales in Glasgow are down 8 per cent’. It is information that can be measured.
 * Quantitative information **


 * Qualitative information **

This type of information is more concerned with peoples feelings and opinions. For example ‘I like cheese and onion crisps best’.

Businesses can get information from four main sources. Each source can produce both quantitative and qualitative information.

For example, banks often carry out surveys of their customers to see if they are satisfied with their service, and ask about any improvements that can be made.
 * primary information** i s first hand information gathered by a business for their own purposes using questionnaires, interviews, etc

This will include information contained in reference books, business and government statistics, information from market research companies, information from competitors, etc. For example, a government report on levels of air pollution will provide important information for car manufacturers on research and development of cleaner engines.
 * secondary information **has been collected by someone else for their own purpose. However, businesses can also make use of it.

This type of information is very important in helping to manage the organisation e.g. sales forecasts produced by the sales department will tell production how much they should plan to produce
 * internal information** is information from a business’s own records, which is only available to them.

To manage the organisation well, it is important to use all the different sources. However, each source can have different costs. Information from different sources brings different benefits to an organisation.
 * external information** is any information gathered from outside the organisation – for example, a newspaper article describing the closure of one of your main competitors will allow you to move for their customers’ business


 * Types of Information**

When we receive information it comes in a variety of forms. For example, we may receive a postcard to remind us of a dental appointment, or we may get a phone call from a friend to meet them later that evening. However, it would not be appropriate for the friend to send us a postcard to meet them later.

How the information is actually presented will affect how useful it is.

letters, memos, reports, notices, etc.
 * written**

face-to-face, over the telephone etc.
 * Oral**

pictures can give people the idea much faster than trying to explain it to them.
 * pictorial**

charts and graphs make it easier for people to understand, especially when there are a lot of numbers involved.
 * graphical**

rows and columns of numbers produced in a certain way to aid understanding. For example, the financial accounts of a business. Most pieces of information will use a mixture of these types of presentation. The bigger the piece of information, the more types that will be used.
 * numerical**

W - Letters - __Advantages__ - Good for passing information, can be kept and used later, easy to collect __Disadvantages__ - Can be lost, wastes alot of paper, bad for the environment, often delayed, set on fire

E-mail - __Advantages__ - easier to send, quick response, could reach alot of people through email, no hastle __Disadvantages__ - easy to make mistakes, need internet access, could get viruses, computer could suddenly stop working.

ORAL: __ADVANTAGES__ - Good for discussion, advice and simple instructions. You can easily change your mind quickly. It is quicker than sending an E-mail and waiting on a reply. You can get relevant information quickly. You can ask questions and receive a simple response. It is first hand and there is no complications. __DISADVANTAGES:__ It’s not as formal as written. The information can be forgotten. It costs money to talk on the phone. You could not understand the language or the accent. You may not know the number of the person you are calling.

Pictorial - __Advantages__ : Colourful, Appealing, Finding pictures require less work than writing, If you couldn't read pictures help. __Disadvantages__ : Confusing, Too many pictures, can be hard to get information across, may not be clear pictures. G

N

· You can easily see who it has come from. · You can keep it as a record. · You can go and check how reliable it is. ||  || · Allows you the chance to get to know people. · You can give or get advice and guidance. · Discussion is much easier. ||  || · It is a good way to stress certain points you wish to to make. ||  || · Allows comparisons to be easily made. ||  || · Can compare yourself with competitors. ||  ||
 * Benefits of using the different types of information **
 * **written** || · Written information can be easily referred to – you can go back and check again.
 * **oral** || · You get a response straight away.
 * **pictorial** || · Information is easy to remember.
 * **graphical** || · Good way to display complicated information.
 * **numerical** || · Allows for forecasting, calculations, and comparing different courses of action if used with a spreadsheet programme.


 * Uses of information in business **

Businesses need information to function properly. They use information for four main functions:

· monitoring and control · decision-making · measuring performance · identifying new business opportunities.

A business will compare its actual performance against its budgeted performance. It will use records from previous year’s performance and take account of any changes that have taken place to draw up its budgets.
 * Monitoring and control **

For example, government statistics on the rate of inflation and consumer spending will indicate what should happen this year. The business may also use reports from market research companies to look at changes in their market. All this will be used to make sure the business is running as it should.

Managers have to make decisions. In order to make the right decisions they have to have accurate up-to-date information.
 * Decision making **

For example, decisions about what new products to introduce will be the result of extensive market research and reports from the sales department. Without this information the wrong products could be produced which would not sell.

Information allows you to compare your business’s performance against that of your competitors.
 * Measuring performance **

For example, you can use your sales figures to compare your success against your competitor’s sales.

Businesses need to update their products and, where possible, introduce new products or identify new markets for their products.
 * Identifying new business opportunities **

For example, market research indicates that over 40 per cent of CDs are bought by consumers over the age of 30 – this indicated to record companies that there would be a market for CDs of albums that were first popular in the 70s, 80s and 90s.


 * Information and communication technology (ICT) in business **

In recent years, the introduction of Information and Communication Technology has significantly changed the way in which organisations operate. Organisations can share vast amounts of information because of the ease of communication and availability of information that can now be accessed. Small businesses are now able to compete more easily with larger companies. The Information and Communication Technology revolution has also led to a large number of people being able to work from home.
 * Introduction **

Information in organisations is usually processed by computers. Organisations require hardware to input the information. Information may be fed into the computer by means of keyboards or scanners. The information can be stored on hard disc, floppy disc or CD ROM. Software packages allow the information to be processed. Other hardware like printers produce the processed data in a form which can be used.

Information and Communication Technology is often abbreviated to ICT. This abbreviation will be used here. In recent years, the term information and communication technology (ICT) has begun to be used instead of information technology (IT). This is because of the growth of things like the internet which combine communications and information technology. Usually, IT and ICT mean the same thing.

The main uses of ICT in businesses are for:
 * Uses of Information and Communication Technology **

· **//Decision making//** Decision making will be improved if there is access to information. ICT has helped decision makers a great deal – they are able to store more information and retrieve it instantly. Spreadsheets packages permit information to be changed to allow different situations/scenarios to be tried out. Management can then base decisions on possible outcomes

illustrated. Databases are a powerful tool in information management. They enable businesses to use searching, sorting and reporting facilities to analyse the information held.

· **//Provision of information//** ICT makes it much easier for businesses to provide information. They can distribute information to people inside the business via e-mail and on the internet/intranet using web sites. For example, information on sales can be used by the operations department to plan future production levels. The marketing department could also use sales information to see which products or services are selling best.

· **//Maintenance of records//** ICT makes it much easier for businesses to keep records of what they do. For example, a database can be used to save vast amounts of information. It can be sorted or searched through for specific information. Databases can be used to hold information on:

• staff in the human resources department • customers in the marketing department • maintenance firms in operations • suppliers or customers that the finance department deal with.

Manipulating data on databases may help business to make better decisions. A database on employees may help businesses identify employees who are due to retire or employees who have completed particular types of training. A database of employees may also help to prove that the business is acting in accordance with laws against discrimination.

· **//Communications//** Computers can be used for communication within and outwith organisations using packages like e-mail, internet or video conferencing. The can also be used for word processing letters, news sheets, notices and advertisements.

ICT can have other uses as well. It can be used to keep track of what is happening in the business. For example, spreadsheets can be used to check on departmental and organisational budgets so that action can be taken if too much is being spent.


 * Types of Information and Communication Technology **

Personal computers (PCs) and laptops allow staff access to information from their desk-top, when travelling or when working from home.
 * // Personal computers //**

These have more processing power than personal computers. They are used to handle large amounts of information e.g. for a whole organisation or for a department.
 * // Mainframe and Mini-computers //**

Interactive video-conferencing allows people to attend meetings from their base by linking each of the members of the group by means of a computer via cameras and monitors.
 * // Video Conferencing //**

People can hold meetings without having to travel to the same place, saving time and travel costs.

Interactive multimedia is any computer-delivered electronic system that allows the user to control, combine and manipulate different types of media, such as text, sound, video, computer graphics and animation. Multimedia can be used in organisations for training programmes, advertising and promotional CDs.
 * // Multimedia //**

Computer controlled machinery e.g. robots can improve quality by ensuring standard output. Computer controlled machinery can be versatile and adaptable, and is capable of greater and faster production.
 * // Computer Aided Manufacture //**

The internet allows firms to access vast quantities of information. They can also set up their own websites to market and sell their products. Using the internet and e-mail for selling company products is known as e-commerce.
 * // Internet //**

Using e-commerce opens up new markets, can increase sales and allows small companies to compete with larger companies.

Fast easy communication between people is available as long as the users have access to a computer and the internet. It helps organisations to communicate between factories or branches and with customers or suppliers. Two way communication can take place online.
 * // E-mail //**


 * Software **

A database is any collection of data or information which is organised for quick search and retrieval by a computer. Records can be stored, modified and sorted using the database.
 * // Databases //**

Spreadsheets are used to analyse figures and calculate information. Formulae are inserted into the spreadsheet and the computer completes all the calculations.
 * // Spreadsheets //**

Word processing allows information to be keyed in. The material can then be altered and stored or printed out. It is an efficient and effective document presentation package.
 * // Word processing //**

Desk-top publishing allows documents to be produced to a very high standard. Text and graphics can be incorporated to produce professional advertising information, quality documents for customers, reports, newsletters, training documentation and inhouse magazines etc.
 * // Desk top publishing (DTP) //**


 * Benefits and Costs of Information and Communication Technology **

Goods and services can be produced more quickly using ICT. Computer controlled machinery means goods can be produced more quickly. It also results in increased output and higher quality. Using a work scheduling package can save time in working out a schedule as well as saving the company money and reducing labour costs.
 * Benefits of Information and Communication Technology **
 * // Speed //**

Receiving orders from customers via e-mail means they can be quickly processed. Word processing packages can save time because documents like letters do not have to be typed out several times. Standard letters and mail merge can be used to save time also. Vast amounts of information are available on the internet which would otherwise have taken a great deal of time to research.

// Flexibility // ICT can help businesses to be more flexible. Organisations can use software packages like DTP to get a greater variety of layouts or images for advertisements, handbooks or company brochures as well as improving the quality of output. E-mail and the internet give businesses more options in the way that they can communicate with customers. Software for scheduling work makes it easier for companies to change production schedules. ICT can help companies to improve the way they analyse information. For example, on sales trends or costs of production. Databases mean companies can access much more information, more quickly. It is also easier to search databases for particular items of information. Computers can process large quantities of data. Some companies have set up systems which enable them to automatically reorder stocks when levels fall to the reorder level. Retailers are able to keep track of how much of each item is sold in each store.
 * // Handling of complex information //**

There are other benefits of ICT such as:

· increased efficiency – for example, when using customer databases or producing goods · reduction of waste when using computer controlled machinery · improved environment, as there is less waste · improved communication using e-mail or mobile phones · using a website may gain publicity and boost sales · opening up new markets through e-commerce. However, there are also drawbacks relating to the installation and use of new Information and Communication Technology.
 * Costs of Information and Communication Technology **

There are initial purchase and installation costs when introducing computerised machinery, computers or setting up websites. There are also financial costs of buying suitable software. These can become large if the business needs specially written software. Hardware and software must also be kept up-to-date and upgrades to hardware and software mean more expense for the firm.
 * // Financial outlay //**

ICT may also lead to change, and there are costs involved in managing the change. These can involve management time to negotiate with staff and follow the initiative through. There can also be costs involved in staff time as employees have to get used to new ways of working. Employees need to be trained to work with ICT equipment. This is an ongoing requirement because hardware and software are always changing. Training may reduce output because it takes up staff time. It means they cannot be doing their normal work at the usual speed. The financial costs of training may therefore be high. There is always a danger that some data may become lost/damaged/corrupted. Most businesses try to avoid this problem by keeping back-up copies of all data. Additional storage of data costs more money and takes up staff time.
 * // Staff training //**
 * // Data loss/damage/corruption //**

There may be other problems with storing data using ICT systems. Hackers may get into the system and get access to confidential data. Viruses could also disrupt the working of an ICT system. Also the system may break down for other reasons like a power cut.

Other drawbacks of ICT include the following:

· ICT may mean changes in the work staff carry out. Some employees staff may not feel happy about the change in their role – they may feel threatened by the introduction of ICT. · There may be job losses, as fewer personnel are needed to complete the work. · Staff motivation may be reduced as they may find they are doing monotonous tasks.

Organisations which hold personal details on computerised systems must comply with the terms of the Data Protection Act – this will involve ensuring that proper information handling systems are in place and that staff are trained appropriately.
 * // Data Protection Act (1998) //**

The Act states that **information** held must:

· be obtained fairly and lawfully · be adequate and relevant · be accurate and up-to-date · be kept secure · not be disclosed to others.

Individuals are entitled to copies of the information held about themselves if they request it, and, where appropriate, any incorrect details must be amended or erased.

Some of the terms used in the notes are explained a little more fully below. There are also some terms which have appeared in other units but which are also relevant to Information and Communication Technology included in the glossary.
 * Glossary **
 * **Term** || **Meaning** ||
 * **automation** || machines are operated by computers rather than workers. ||
 * **CAD** || computer aided design. ||
 * **DTP** || desk top publishing. ||
 * **GIGO** || (garbage in/garbage out) the quality of the output depends on the quality of the input. ||
 * **hard copy** || printed copy of information on screen or stored on computer. ||
 * **LAN** || local area networks – several personal computers linked together with one server. ||
 * **modem** || device that allows computers and telephones to communicate. ||
 * **networking** || linking people together electronically. ||
 * **on-line** || direct access to information. ||
 * **robot** || programmed machines controlled by computers to function like workers. ||
 * **teleworking** || using telecommunications to work from home. ||
 * **user-friendly** || computer packages which are easy to use successfully with little experience. ||
 * **workstation** || the location of computer/word processor operator. ||

These notes are from LTS and the original can be found here


 * Graphical.

Advantages.

An advantage of grapical comunication would be that it makes it easier to compare things like sale figures etc, it makes it easier to see trens in the sales and it is easy to read datta. It also makes it easy to compare against competators sales figures.

Some disadvantages that this would have would be that things could go wrong with e.g computor crashing. It also could take a lot of time to get the information you need. **

· Easy to read data and information. · Detailed info. · Very reliable. · Can be confusing. · Can be hard to get info. · Need to be good with numbers.
 * Numerical **
 * Advantages; **
 * Disadvantages; **