Solutions to Assignments
MBA and MBA (Banking & Finance)
MMPC-008 - Information System for Managers
MMPC-008/TMA/JAN/2022
Question No. 1. “The IT has been used in every business and for every function of a business.” Do you agree? Give reasons for your answer. Also explain application of IT in business.
Information Technology (IT) has become a strategic necessity. Unless we
believe in IT and act on it, there is every chance of becoming a footnote in the
annals of History. IT has become a vital component of successful businesses
and organizations. Managers are expected to identify opportunities to
implement Information System (IS) to improve the business processes.
Managers are also required to lead IS projects in IT.
Information Technology has become a major facilitator of business activities.
It is also a catalyst of fundamental changes in the structure, operations and
management of organizations.
IT can be used to:
1. Perform high-speed, high-volume, numeric computations.
2. Provide fast, accurate and inexpensive communication within and
between organizations.
3. Store huge amounts of data in an easy-to-access yet small space and
allow quick and easy access.
4. Automate business processes and manually done tasks.
5. Analyse big volume of data available through internet for decision
making.
IT has been used for improving productivity, reducing cost, enhancing
decision making process, enhancing customer relationships, and developing
new strategic applications. The business paradigm has completely shifted
from being sellers market to buyers market. Customers have become the
focal point of any business. The business environment is no more as stable as
it used to be and has become much more competitive. It became mandatory
on the part of the organizations to make full use of IT to survive. IT has
become one of the standard components of an organization.
Information is the finished product
for which data is the raw material. The dictionary defines information as
processed data, which is used to trigger certain actions or gain understanding
of what the data implies.
Information has also been defined as data that have been put into a
meaningful and useful context and communicated to a recipient who
uses it to make decisions. Information involves the communication and
reception of intelligence or knowledge. It apprises and notifies; surprises
and stimulates, reduces uncertainty, reveals additional alternatives or helps
eliminate irrelevant or poor ones, and influences individuals and stimulates
them to action.
The information must be received by the recipient within the
required time frame and the information must be free from errors.
The technology plays an important role in delivering timely and error free
information to its recipients. Technology includes hardware, software,
databases, and communication system. Hardware is a set of devices such
as processor, monitors, keyboard, and printer that accept data, process
them, and display them. Software is a set of programs that enable the
hardware to process data. Database is also an integral part of IT system,
which is a collection of related files, tables, relation etc. that stores data
and the association among them. Network connects computing resources
of an organization and facilitates sharing of hardware and software.
The
organization processes and people are integral part of an IT System.
Now we know what information is and what technology is. With this, we
are ready for a definition of IT.
The impact of IT on a business has been tremendous. One of the advantages
of IT systems for a business is the cost-performance ratio, which is better
in case of computers. The labor cost increases every year but the cost of
computer does not increase. A better and more powerful computer can be
bought for the same price after a year. It is better to use computers for
routine jobs as far as possible. The IT has been used in every business and
for every function of a business. Some of the applications are as follows.
- Finance and accounting - IT has been used for forecasting revenues, determining the best sources and uses of funds and managing cash and other financial resources. IT has also been used to analyze investments and perform audits.
- Sales and marketing - IT has been used to develop new services, which may not exist without IT. IT has helped management of various organizations to determine the best location for production and distribution facilities. The operational data has been analyzed using IT to determine the best advertising and sales approaches. The product prices have been set using IT to get the highest total revenues. In other words, IT has been used for product analysis and price analysis.
- Manufacturing - IT has been extensively used for processing customer orders, controlling inventory levels, developing production schedules and for monitoring product quality. A whole new discipline- Computer Aided Design and Computer Aided Manufacturing has evolved due to application of IT to design and manufacturing. The manufacturing is not what is used to be due to the use of computers, Computer Integrated Manufacturing (CIM) dominates the manufacturing sector. Use of robots is increasing not only in manufacturing plants but also in other sectors such as healthcare, laboratories, defense sector etc.
- Human Resource Management - Companies are using IT systems for screening applicants and conducting various tests.
- Project Management - A range of software packages are available in the market for managing projects. These software products let the management set the schedules, milestones, facilitate communication among group members, and monitor the project progress. These products help in document and report preparation.
- Data Analysis- Investment firms heavily use information systems to analyze stocks, bonds and options to provide better service to their clients. With the internet connectivity this application is high in demand even by other firms dealing with large data.
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