Using IT in your Business

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Contents of the free course

Introduction
What is Information Technology?
How Can IT Help my Business?
Exercise

Have you also considered these aspects of the course?

• The Business Case for IT
• Information Technology — a Brief Overview
• E-Commerce
• Purchasing IT Equipment and Software
• Maintaining IT Systems
• Health and Safety
• Data Protection
• Data Security
• Computer Viruses
• Implementing an IT Policy
• Sources of Advice
• Glossary of IT Terms and Expressions

Take the full course and receive nationally recognised qualification or call us free at 08000-75-8000 for further information

Aim
The aim of this course is to help businesses to understand the benefits of using information technology (IT) to make their business more effective and efficient.

Objectives
By the end of the course you will be able to:
. Understand the business benefits of IT
. Appreciate the range of uses of IT in business
• Identify specific uses for IT in your business
• Locate sources of help and advice
• Plan the implementation of an IT strategy
• Compose an IT policy

 
Introduction
Very few, if any, businesses now trade without making use of Information Technology in one form or another. Even if you yourself do not use a computer it is very likely that your suppliers and customers do. The rate of growth of computers and Information Technology over the last 20 years has been nothing short of a revolution: one which is set to continue for the foreseeable future. The danger is that as the pace of technological change increases with each year, businesses will be left behind. Many people fear this explosion because it requires us all to learn new skills, make new investments, and come to terms with things we don’t quite fully understand.
This concern is often related to the jargon which springs up with Information Technology, of which there is much. Getting to grips with computer technology can be a daunting experience, and time consuming. If we were honest, most of us would rather spend the time doing the things we are good at and enjoy rather than wrestling with technology and all its associated problems.
In reality though, Information Technology does not demand that we all become computer experts. There are many sources of help and advice available and the technical aspects can be left to others. The major concern for businesses, especially small business, should be with knowing the capabilities of Information Technology and making business decisions based on an evaluation of how it can help us.
IT is like any other tool; we need to have a broad understanding of how it can help, how to evaluate the costs and benefits of using it, and how to implement IT systems so that we can obtain the maximum benefit.

Take the full course and receive nationally recognised qualification or call us free at 08000-75-8000 for further information

There are many texts and sources of detailed technical advice for those who wish to seek it. This course will concentrate on how businesses can make use of technology and introduce it successfully — with the minimum of jargon.
At the end of this module you will be able to answer the question “how can I use Information Technology to make my business operate more effectively?”. The steps to answering this question can be summarised as follows, and these are the steps which this module will cover in turn.
. Understanding what IT can do
. Evaluating which functions will help my business
. Choosing applications
. Making the business case
. How to purchase
. Implementing IT
. Using IT safely and reliably
. Maintaining systems
. Staying in touch with developments
Conversely, this module is not about technical detail and the inner working of hardware and software. There are many texts written on these subjects and for most people taking business decisions about Information Technology there are many sources of advice on such matters available.

What is Information Technology?
Stories about how and when computers were first invented abound, but their origins can be traced to the work of Second World War code breakers who needed to process vast quantities of information to gather intelligence.
Although machines built during this period were huge, slow and unreliable they did signpost the transition to what is now called the Information Revolution — the use of electronic means to store, use and transfer information.
The modem day computer was born in the late 1970’s and is attributable to the invention of ‘chips’ — devices for storing and processing information using micro electronic devices. Before this valves and transistors meant that computers were relatively slow, quite large and inordinately expensive. The introduction of microchips heralded the production of computers which could be made small enough for mass manufacture, and cheap enough for general applications. Even so, early personal computers had limited application because they were not able to transfer information to other machines easily and the programmes used to process information were, in today’s terms, primitive.
The explosion in use of Information technology over the last 20 years or so has been made possible because of further miniaturisation, massive reductions in cost and the development of operating systems and software which mean that lay users could access the benefits without becoming systems analysts programmers or other specialists.
So what, then, is Information Technology?
At its simplest the expression refers to a variety of machines and techniques for processing information quickly and efficiently, transferring that information and making use of it.

Take the full course and receive nationally recognised qualification or call us free at 08000-75-8000 for further information

Let us look at an example. If you wanted to send invoices to a number of your customers in the ‘good old days’ you would laboriously type each one separately using a typewriter, carefully making sure that you used carbon paper so that you had a copy for your filing cabinet. Now, of course, using modem technology you are probably using a document template in your word processor, a sales ledger in your accountancy package and a database of customer addresses to merge the invoices and print them in batches. Whilst many people still retain paper copies, your computer will have a file or folder containing invoices which means you can print reminders whenever and send the copies to your accountant by email.
Customers on the other hand would receive invoices in the post, arrange payment by cheque and request a written receipt. Chances are they are now paying bills by automatic transfer to your account and issuing a remittance advice from their computer.
So why the fuss? The difference, of course, is that in this very simple example it is easy to spot the business benefits. The time saved in preparing invoices, filing, posting, receiving cheques, paying them into your bank etc. is substantial to say the least. As we think of more complex examples the time and cost savings can be enormous.
Consequently the information revolution is being driven not by technical feasibility (although that is clearly very important) but by quantifiable benefits to businesses and individuals. Clearly then we need to be able to evaluate the possibilities of Information Technology and the benefits which it brings. Later in this book we shall examine ways of evaluating the benefits.
Another way of looking at “what is Information Technology?” is to examine the range of systems now embraced within the definition. IT used to be the way of describing computers, mainly desktop, which carried out tasks like word-processing, accounting, storing data etc. Whilst this is still true, IT now means much more. It refers to a whole series of ways of communicating information using telephone lines, radio waves and the Internet.
Here are just a few examples.
Accessing Information
Weather forecasts, sporting results, news, articles (the list is endless) can all now be accessed via the Internet. By using a device (called a modem) to connect a personal computer to a telephone line, vast sources of information are at the fingertips of everyone.
Contacting people
Gone are the days when if you wanted to arrange a meeting, for example, you wrote to your colleagues, or telephoned them all in turn. Now with the advent of email, sending messages and arranging meetings can be done in a few moments.
Banking
Remember when banks closed at 3.30 in the afternoon and required a trip into town to deposit money or pay bills? Now with ‘on-
line’ banking, bills, statements and a range of banking services are available at your fingertips.
Stock Control
Shops used to count up their stock every day/week/month and use this information to re-order their stock. No wonder it was so common to find items out of stock! Now with electronic bar code reading, stock is automatically counted in stores and re-ordering done automatically, ensuring that fresh stock can arrive’ just in time’.
Purchasing
The chore of shopping (was it ever a pleasure?) used to require visits to shops! Booking a train ticket or a book (and almost everything else) can now be done instantly using on-line shopping facilities and plastic cards. E-shopping is now growing rapidly and in some industries such as low cost air travel accounts for well over half of bookings.

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If you think back just a few years none of this was possible but we have embraced these technologies without hesitation.

Why?
The reason why Information Technology makes such an impact on all our lives is because there is a business case for it. Although people will cite advances in technology, further miniaturisation, satellite technology and fiber optic cables as the reasons for the explosion in IT, all of these just make IT easier and cheaper. In turn this makes IT solutions more attractive because it saves time and money, and makes more things possible.
In other words users of IT can identify a benefit which improves what they want to achieve. In business it is the ability to do things more cheaply, more accurately or with fewer resources which drives change. In the next section we will look at how to evaluate Information Technology and then build a business case for its use.

How Can IT Help My Business?
Before examining the business benefits of IT, it would be useful to look briefly at the ways in which IT can help. These can be examined under a number of headings.

Storing and Retrieving Data
Because modern day computers are so powerful, with unimaginable ability to store vast quantities of information, they are of course, ideal for keeping records and storing data.
Most businesses will store quite a lot of information, especially when you consider that for accounting and audit purposes, records for up to seven years may be required.
Typically, even small businesses will keep records covering:
Customer details
Supplier details
Sales records
Invoice records
Stock records
Correspondence
Financial data
And probably many more forms of record and data as well.

Compared to the traditional filing cabinet, computers present opportunities to store much greater quantities of information, and much more effectively. Using databases and spreadsheets, information can be stored in such a way that it can be retrieved and used in many different ways. If, for example, you consider a list of customers and their addresses, a database will enable you to produce that information in almost any format you wish. Also, and very importantly, you can edit and select information for use in different purposes. Customers can be mailed according to their postcode, date of last purchase, products purchased etc. etc. The list is endless. The speed at which merged documents can be produced, selecting only relevant information makes data storage a must for every business.
Another aspect to data storage is the fact that marketing literature, manuals, policies etc can be stored and updated as and when required. No longer do company documents need to be re-typed every year. When a policy, procedure or brochure needs to change, it can be done so very quickly if the information is stored on computer.

Producing Documents  
Whether your business produces just letters and invoices, or whether you produce technical manuals and price lists etc., document production is extremely easy using IT. Documents can be made to look very professional; they can be customised to individual customers and produced in a variety of formats. Using Word-processing or publishing software, high quality document production can include colour, charts, drawings and photographs very easily. By using mail merge techniques, individualised letters, address labels and sales materials can be printed as easily as typing a single document.
The finished document can be printed using relatively low cost inkjet and laser printing technology but there is now also the opportunity to distribute documents by email, enabling customers to receive your information directly and saving on postage costs!

 
Accounting
The advent of spreadsheets and accounting packages has brought simple accounting on a computer to many small businesses.  
Spreadsheets provide the opportunity to carry out routine calculations on a regular basis with simplicity. Accounting packages such as Sage Instant Accounting provide a full range of accounting functions including
. Sales ledger
. Purchase ledger
. Fixed Assets
. Current Assets
. Current Liabilities
. Capital & reserves
. Direct Expenses
. Overheads
. Payroll
Monthly accounting routines, VAT returns, payroll and year-end functions can be performed relatively easily using modern day accounting packages.

Communicating with Staff, Customers, Suppliers
Communicating can be a very time consuming business, and keeping in touch is something none of us is very good at, probably for that reason. If contact is maintained through internal memos, telephone, fax and letter, the process can be expensive and certainly time consuming. Telephoning can be especially arduous and costly when you consider how often the person you wish to speak to is not available and messages have to be left. Incoming calls too can be wasteful when they break your concentration. The other option now is to make greater use of electronic mail (email). By using email, messages, letters, documents, reports etc. can be mailed to colleagues, customers and suppliers alike. These will be read when the recipient wishes and so by good use of the priority markers with emails, urgent messages can be communicated quickly; routine ones read and responded to when convenient

Finding and Accessing Information
The World Wide Web now affords an opportunity to access almost limitless information. Where once we had to write to suppliers for brochures, trawl through directories for phone numbers and addresses, and queue on the phone for travel information, all of this is now accessible on the Internet. Equally, information about your company can be displayed on the web providing a valuable advertising opportunity.

E-Commerce
Ordering and paying for goods has been a necessary burden for businesses since commerce began. Dispatching products on receipt of an order, sending an invoice, credit control etc is an expense which just detracts from the profit or any commercial enterprise. Credit and debit card payment, linked to e-commerce now presents every business with opportunities to receive payment at the time of ordering and so reduce the administrative burden of cash collection, and very importantly can greatly ease cash flow. If you offer 30 days credit to customers on production of an invoice the chances are that you will be waiting up to 40 or 50 days for receipt of much of your cash. e-commerce can obviously reduce that dramatically and provide a welcome cash boost for businesses. Additionally, payment by card significantly reduces the need for credit checking or asking for cash with order.
Using Electronic Data Interchange (EDT) larger businesses now integrate their accounting system to the extent that the client business actually raises a purchase order electronically on their supplier’s system and can have the facility to track the order through the manufacturing and dispatch processes.

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Keeping Control
Every business, from a one-person operation to a multi-national, needs to exercise control of its business. In order to know where the business is at present, to plan cash flow and investment, to monitor marketing expenditure and the variety of other controls we need in place requires information.
As discussed above, providing access to information is the bread and butter of Information Technology and of course the better the information the better opportunity there is to exercise control.
The measures described above are just a few examples of how a business can benefit from well thought out use of Information Technology. There are many others and. it would be worth spending a few moments now thinking about your business needs.

 
Exercise
Think about your business. In what ways do you accumulate, store and distribute information and approximately how long per week do you spend on these activities?
Most businesses report that introducing information technology can save between 1 0% and 3 0% of the time spent on these tasks so it would be easy to forecast the cumulative savings to be gained. Of course achieving the savings requires careful planning and implementation and this is considered in the full course.

Take the full course and receive nationally recognised qualification or call us free at 08000-75-8000 for further information