IT AND BUSINESS

■ Introduction
IT is the use of computer and other internet based telecommunications
equipment to store, manipulate and retrieve data. Generally, IT relates to the
hardware and software that individual and organization use to manage and
operate its activities. Most organizations use computer to share their
information through Website and other informational source.

■ Definition of IT
Information Technology indicates the technology which refers to the
transmission and storage of information especially the development,
installation, implementation, and management of computer systems.

Basically it indicates the use of computer network but in broader sense, it

also includes other internet distribution technology such as television,
telephone etc.

According to the IT association of America, “IT is the study, design,

development, application, implementation, support or management of
computer based information system.

According to Oxford Dictionary, “IT is the study or use of electronic

equipment, especially computers, for storing and analyzing information”

■ History of IT
The term IT first appeared in a 1958 article published in the Harvard
Business Review. The authors Leavitt and Whisler named is IT as it was
named before. IT development can be distinguished in four distinct phases
based on storage and processing employed that are -
 Pre-mechanical ( 3000 BC – 1450 AD )
  Mechanical ( 1450 AD – 1840 AD )
 Electro-mechanical ( 1840 AD - 1940 )
 Electronic ( 1940 – Present )

■ Instruments of IT
There are many industries associated with IT that are Computer Hardware,
Software, Electronics, Semiconductors, Telecom Equipment, Computer
Service and other Internet based elements.

■ IT and Business
IT is dominating business by spreading over the fields of an organization.
Now a day it’s impossible to think to start a business and run its activities
without IT. Organization needs IT to carry on its working process.

Organization needs IT in those fields -

 Management
 Delegation
 Performance Evaluation
 Planning

 Finance & Accounting

 Book Keeping
 Preparing Financial Statement
 Providing Information
 Investigating Cash Flow

 Sales & Marketing

 Research & Development
 Promotion
 Distribution
 Quality Assurance
 HRM
 Recruitment & Selection
 Manpower Planning
 Dismissal & Training Program
 Motivation

 Production
 Production & Planning
 Purchasing & Storing
 Design & Technical Support
 Logistics & Supply Chain Management

 Maintenance & Operation

 Customer Service

 Quality Assurance

■ IT and Globalization
IT is a driving factor of globalization. IT provides the communication
network that facilitates the expansion of products, ideas and resources
among nations and among people regardless of geographic location. It’s
integrating globe through creating efficient and effective media of
exchanging information. Now the internet and web have transformed
commerce, creating new ways for retailers and customers to make
transactions to manage the flow of production inputs and for job seekers and
recruiters to find each other. The IT revolution has been driven by the
extraordinary rapid decline in the cost and rapid increase in the processing
power of digital technologies

Again the decline in computing prices has been a factor in spurning the
growth of computers in the developing world. It has extended the use
technology in world.
■ IT and Multinational Companies
Multinational Companies are registered in more than one countries. IT plays
an important role in the case multinational companies. It assists those
companies in making strategies, running operations, expanding territory,
marketing superiorities, product innovation and others. Multinational
companies are now using IT in minimizing the cost of production as well as
the cost of operation. Many of these multinational corporations produce
global brands with similar marketing mixes across the world. In this sense
they have to take the help of IT to control the quality of product.

■ Use of IT in Business
Information Technology refers to the techniques used in business for
transmitting, storing, manipulating and retrieving all kinds of data. It’s very
useful in organizational purpose.

Organizations use IT for -

 Storing products information such as stock control using sophisticated

databases.

 Making costing and profit calculations by spreadsheets.

 Providing advertising and promotional literature using computer graphics

packages.

 Processing information, writing documents through word processing

packages.
 Internal communication by Fax, Email & other methods of
communication like telephone linking.

 Using presentation software, Power Point, for making colorful

presentations.

 Creating website as a informational & promotional tools for a company

■ Objectives of IT in Business
Companies depend on IT for fast communications, data processing & market
intelligence. IT plays a great role in every organization, helps companies to
improve business strategies, achieves business efficiency, improves revenue
growth and creates competitive advantages.

Six important business objectives of IT are-

 Product Development

 Stakeholder Integration

 Process Improvement

 Cost Efficiencies

 Competitive Advantages

 Globalization

■ Importance of IT in Business
Without strong IT business is like a blind person. It’s the era of IT. No
business can survive in this competitive corporate world without IT. Today
most of the business is going global so the precondition to be a successful
global company is having a strong IT.

With the help of IT doing business has become very easier since ever before
as the organizations gain the following qualities-
 Time and Cost saving: IT makes it easy to do works by a short time
and cost. With the help of internet the complexity of doing a work has
become simplicity and thus the time and cost has become minimum.
 Progress with e-commerce: With the assistance of e-commerce now
it’s possible to buy something without going market. Technology
provides us an easy shopping through internet.
 Operating globally: IT created a network of business around the
world. Now many multinational companies are operating globally for
IT.
 Turning waste into wealth: Through recycling IT is making different
product from garbage. Thus it’s turning wastage into wealth.
 Creating new transport system: Companies are now giving service
through transport system. This system helps to reach destination
within a short time.
The other importance of IT is-
 Multi-Tasking
 Perfect Recruitment and Training
 Skilled Book-keeping
 Efficient Cash Management
 Maintain Product Quality
 Efficient Market Targeting
 Increasing Sales and Profitability
 Maintain Customer Commitment
 Effective flow of Information
 Efficiency of Management
Thus information technology achieves organizational goal.
■ Advantages & Disadvantages of IT in Business:
Advantages: IT benefits the business world by helping companies to work
efficiently and maximize productivity. Effective communication, electronic
storage and saving records are the advantages generate from IT. IT has
changed the way that the world runs business. Instead of many weeks IT is
serving people instantly by pressing a button.

Some advantages of IT are mentioned below-

 Storing and Protecting Information

 Automate Processes
 Work Remotely
 Communication

Disadvantages: By communicating through telephone management is

minimizing its travel to abroad. That’s why the mutual understanding among
people around the world has been diminished. Although the benefits of IT
are many there are also some disadvantages of its use. Those are -

 Implementation Expenses
 Job Elimination
 Security Breaches

■ Impact of IT on Business
If we look at the broad arena of information technology, we’ll see its vast
impact on business. IT is affecting nearly every facet of human endeavor,
and that effect is to speed up, to simplify the process of work of innovation
of scientific exploration.
 Software Improvement
 Hardware Improvement
 IT increasing Exponentially
 GDP increasing Exponentially

■ Conclusion
Finally, we can say that IT has made it easiest to run an organization.
Organization needs IT in every sphere of its lifetime. Through IT the
business enterprises are earning a huge amount of profit by gaining
customers satisfaction through providing best quality goods and services.

In this era of science and technology, now it’s almost impossible to go

through with an organization. Because, if an organization wants to run its
activities without involving with IT, it can’t survive in the long run as the
competitors are making their strategies based on IT. So, IT is the pre-
condition of success.

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 REFERENCES

 IT in Business - Wikipedia, the free encyclopedia

 Oxford Advanced Lerner’s Dictionary – 7th edition

 Advantages of IT in business – by Kyra Sheahan, Demand Media

 Disadvantages of IT in business - by KJ Henderson, Demand Media

 Objectives of IT – Chirantan Basu

 Businesscasestudies.co/uk/business-theory/operations/the-use-of-it

 Globalenvision.org/library