A2 - Business - The relationship between business and the technological environment

Technological changes in business

Technological changes have been dramatic and far reaching over the past decade - and promise to continue to be so over the next ten years. There are few businesses that have been untouched by it, but some have turned it more to their advantage than others.

Common business applications of technology and evaluating business strategies towards them

Information technology system

Wordprocessing

Common business applications

Use in all departments for secretarial tasks. Typing, printing, storing, amending all forms of written letters and messages for internal and external communication.

Advantages 

• Speed
• Accuracy
• Ease of amending documents
• Fewer secretarial staff needed - managers can operate the system with some training
• Links with use of e-mail for quick internal/external communications

Potential limitations of adopting this application

• Now so widespread that not adopting this technology would be unusual
• Staff training will be needed if non-secretarial staff are required to undertake their own secretarial functions.

Information technology system

Pagemarker and publishing programs

Common business applications

Specialist publishing programs can create magazine and newspaper pages for high quality printing direct from the computer. The marketing department can produce its own promotional material. Internal business 'newspapers' can be produced to aid internal communications.

Advantages

• May reduce need for use of professional publishing firms - reducing costs.
• Documents can be amended quickly, e.g. promotional leaflets changed for different countries.
• Professional appearance given to company publications

Potential limitations of adopting this application

• Cost of the software and systems plus staff training - these are not easy programs to use to a very high standard.

Information technology system

Databases

Common business applications

• Used in all departments where the storing, filing and retrieving of large quantities of data is necessary.
• Human Resources department for keeping of personnel records.
• Marketing department for storing details of all customers, addresses, number of products purchased, most frequently purchased products
• Operations department for stock handling, electronic ordering of new supplies, application of JIT stock control process.
• Finance department for recording all transactions including debtor payments and for producing up to date accounting data to management

Advantages

• Replaces vast quantities of paper records
• Rapid retrieval of informations saves time
• Linking two sets of data, e.g. customers and preferred products, allows focused promotional campaigns
• Stock control in retail stores much more effective with electronic tills that relay information directly to central stockholding computer and then to supplier for automatic re-ordering
• Credit control more effective with up to date debtor records
• Widespread use in both stockholding situations and customer data handling.

Potential limitations of adopting this application

• Meeting all of the requirements of the Data Protection Act (data must be used pnly for specific purposes, must not be shared without the consent of individual, etc)
• IT problems can quickly jeopardise the operation of a JIT system
• RFID (radio frequency identification) of reatil goods has raised doubts about individual freedoms if goods are still being tracked after purchase!

Information technology system

Spreadsheet programs

Common business applications

• Financial and management accounting records can be updated and amended
• …