Information Technology & Its Uses in Business Management
by Nicky LaMarco; Updated October 23, 2018
With more innovation in technology, new businesses are created. With more business, technology comes to the rescue by making things easier. The two exist in something of a symbiotic relationship that ensures they will always coexist.
The business has been around since prehistoric times. It may have begun with nothing more than barter trade if the history books are to be believed, but it has since morphed into something far more complex, and none of that would have been possible without technology. The major industries of the world would collapse if the existence and use of information technology were to be snatched suddenly from businesses. That’s because most business transactions and operations cannot be conducted in the 21st century without technology.
Technology Is Necessary for Business
Over the years, technology has caused an explosion in commerce and trade. Because of technology, many traditional business models and concepts were revolutionized. Technology gave us the opportunity to see things from a new perspective, and to approach what we were already doing from a new perspective. Technology also gave us greater efficiency for conducting business.
Some of the areas in which technology is crucial to business include point of sales systems, the use of ICT in management, accounting systems, and other complex aspects of everyday business activities. Even something as simple as the calculator, which was revolutionary in its time, came about because of technology. It is tough to imagine going back to performing tasks manually. It would take us back about 100 or so years.
Technology as a Source of Support and Security
Technology enables us to automate numerous processes, which thereby increases our productivity. This is possible because it enables us to use fewer resources, thereby enabling us to improve on quality at a low cost and to improve the speed with which we can deliver to customers. In the process, it has become possible to serve even more clients.
Technology also makes it easy to store more information while maintaining the integrity of that information. We are better able to store sensitive and confidential information in a way that makes it less vulnerable to a data breach. The information can be retrieved instantly when needed, and it can be analyzed not only to study past trends but also to forecast the future. In turn, this can help with the decision-making process.
Technology as a Link to the World
Communication is a part of the business. So, transportation and processes make business a web of complicated processes that interplay with each other. With technology, it has been possible to globalize business operations. Now, just about anyone can do business practically anywhere, from any room in their house.
Technology has made it possible for businesses to have a wider reach in the world. The best example of this is the internet and the World Wide Web. The internet is now a crucial part of any businesses’ marketing campaign, as it enables the business to attract customers worldwide.
Technology, when well-integrated with business, has made life itself worth living. It would be foolish to deny, however, that there are also threats to business brought about by technology. These include malicious activities by activities and organizations, such as hacking. Because of this, it is important for businesses to exercise responsibility when using technology to conduct business. With the good that technology brings, there is some bad that must also be dealt with. All the same, it is something that’s worth all of the baggage, and we must acknowledge and responsibly utilize it to make our businesses better.
How Does Information Technology Affect Business?
The Industrial Revolution changed things in the business world, making a lot of processes more efficient and increasing productivity a hundred-fold. However, the business world remained somewhat stagnant for a century after. With the technological revolution, and the use of technology in business, however, things changed even more disruptively than during the Industrial Revolution and it would be safe to say that things will never be the same again. The rate at which technology is evolving and adapting is exponential to the point where all businesses are being swept by the wave, whether they are ready for it or not. It might not seem like we’ve made that much progress, but even just 5 years ago, social media did not have any consumerism, mobile phones weren’t used for business, cloud-based solutions did not exist, the App Generation was not born yet, and omni-channel marketing was taking its baby steps.
Technology has just about changed every aspect of business in a big way and this has never happened this fast before in history. To be more specific, here are a few ways in which information technology has affected business:
The Advent of Mobile Solutions
Mobility is seen by many as the next great frontier for businesses. Google’s algorithms reflect this, as they make mobile websites a priority. Your business, and every aspect of it can be handled, using nothing more than a tablet or smartphone. From content marketing to customer relations, to sales, the back-end stuff like invoicing and shipping, all of that power is in your hands.
But mobile solutions aren’t just about businesses; they are also about consumers. The millennial generation uses their phones to do everything from buying and selling to sharing their experiences with their friends and finding local businesses.
The Phenomenon of Cloud Computing
Cloud computing has made it possible for businesses to outsource many of their functions to third parties using the internet. It makes it possible for variable data packages to be handled but also makes it possible for businesses to expand rapidly and embrace mobility without having to worry about such things as crashes, downtime, and lost data. This has enabled small and medium-sized businesses to gain access to resources that would have cost them a fortune only a few years ago. In effect, the playing field has been leveled.
Increased Customer Segmentation
Since more and more data is flowing, it is now much easier to analyze and gain deep insight into the things that customers are looking for. Analytics services are expanding by the day and are allowing businesses to segment their prospects into more and more specific groups, making it much easier to target them and get more value for their advertising money. Something as simple as having a Google account can let a business know where a user is from, the kind of browser they’re using, how they stumbled upon a website, What they do on that website, how long they are likely to stay and at what point they decide to leave. There are even more advanced analytics services that allow businesses to become even more refined with this segmentation in order to improve their conversions drastically.
Technology has made it easier for people to stay in touch. Whether you’re looking to communicate with your employees and colleagues via video chat or sending email blasts to leads, mobile technology and the constant innovation that takes place within the space has made it possible for communication to take on a new level of hyper-realism.
Decreasing Costs and Increasing Utility
There are two main things that have come together to make what is called a “buyer’s market” possible. These are the fact that both hardware and software that are needed in creating the necessary software solutions have become more affordable and the fact that more and more entrepreneurs who are also tech-savvy are appearing by the day to make use of these technologies. There was a time when it would take a large company about a year to build a back-end inventory system. Now it takes a few college graduates a matter of weeks to build the same thing. Since the solutions are offered affordable and very easy to use, businesses do not have to invest too much money into them and that has made business easier.
A Changing Consumer Base
Millennials have come of age and they are now the force driving the modern economy. Pretty soon, over half the American workforce will consist of millennials and pretty soon they will also be coming into their peak affluence, where they will have a lot of money to spend and very few financial obligations, give them a lot of disposable income. They are greater in number than the baby boomers and are a lot more liberal with their wallets. They are also all about instant gratification. They have also been raised with the internet. They are connected, tech-savvy, and ready to spend. Businesses have to adapt to this new customer base if they are going to thrive.
Greater Consideration for the Social Impact of Business
You can’t just assume your business operates in a vacuum anymore. Social networking has made the world a smaller place where users can connect regardless of who they are, where they’re from, and how wealthy they are. Only a few years ago you could have gotten by if your customer service was just okay. Now you have to put in the extra effort if you don’t want unfavorable ratings on review sites and people going on rants on social media about your service. Businesses, therefore, need to be careful about their online reputation and need to work on their digital footprint.
The End of Downtime
This is actually a negative effect of technology. With increased connectivity, individuals have less and less time to themselves now. Vacation seems to have all but becomes a thing of the past, with most people working even when they’re on vacation. Since we can always access our emails, texts, and social media through our phones and laptops, it is harder and harder to just disconnect and wind down.
Why Is Information Technology Important to an Organization?
It might be a little difficult to fathom the importance of information technology to an organization if you’re not an IT professional. However, there are numerous ways in which information technology is crucial to an organization.
The business world changed forever when computers were introduced onto the scene. Businesses can utilize information technology through the use of computers and different software to run their operations in a smoother fashion. They use it in different departments, including finance, manufacturing, human resources, and security.
Education is one of the frontiers of technology and is growing with technology every day. It’s important that education be able to keep up with the progress happening in technology by reaching students in a way that adequately helps them to prepare for the future. The students in our classrooms today are meant to be the thought leaders, business people, teachers, and investors of tomorrow, so technology should be used to prepare them. This includes the use of gadgets in teaching, such as computers, mobile phones, and tablets, as well as the use of the internet as a medium of learning.
With an increasing number of transactions happening online, it is important that financial and security institutions work together to make the internet a safe place. As more transactions are done on the internet, there will be a need for more networks and greater security, making it possible for banks to keep purchases and sales secure.
With improvements in information technology, it is becoming easier to reform the health sector. Medical offices are now able to share medical information with each other, and they can get your health data from your previous doctors. This makes it possible for timely care to be delivered, as well as for costs to be reduced.
With an increasing number of transactions being done online, there is an ever-increasing need for safety. Information technology is what makes it possible to keep your data and information safe and only accessible by you. Through the use of encryption and passwords, your digital data is safely hidden away and can only be accessed by those who have your permission.
How Can I use Technology to Work More Efficiently?
As a business owner, you’re probably wondering how you can use technology to its maximum potential for your business.
First, use technology to integrate communication within your organization. Let your employees be on the same page with each other, using such things as collaboration platforms and social media to keep everyone updated about what is going on in the business and where it is headed. That way, they will be in sync with the goals of the business, and their productivity will be significantly improved.
You can also use technology to improve the service you deliver to your customers, by enabling them to give you feedback on your products and services, as well as suggestions on what you can improve.
With improving security standards, you could also do away with passwords altogether and try biometric security systems, which do not require you to remember a dozen passwords at once.