COMPUTER APPLICATIONS IN BUSINESS

INTRODUCTION:

Computers have affected every sphere of human life. Education, entertainment, communications, calculations, decision making, socializing through social networks, and the way we do business, all these have come under the magical spell of computers.

Businesses have embraced computing, and we can say that today most companies, commercial activities, banking sector and stock market cannot function without computer technology. The following chapter provides a brief overview of computer applications in business.

CLASSIFICATION OF COMPUTER APPLICATIONS:

Computer applications are classified on the basis of the functions that they perform:  input/output, text manipulation, calculation, logic/comparison and storage retrieval. But in most applications, the computer system will execute more than of these functions.

Based on the function, the applications are :

• Function ApplicationInput/Ouput Word processing, spreadsheet and file/database management, financial analysis.
• Text manipulation Word processing, spreadsheet and file/database management. 
• Calculation Financial analysis, project management, graphics
• Storage retrieval outlining, mailing list, file/database management.

A few business applications are now discussed below:

BILLING:

A company may get orders for its business from visits of salespersons, from telephone contacts or from the other sources. The sales order (or customer order) is the first document generated in the order entry process. The salesperson or clerk prepares the sales order, and multiple copies of it are maintained.

After the order has been shipped, a bill or invoice must be created and sent to the customer. Bills are sent out promptly to minimize the amount of money that a business has tied up in unpaid shipments. It is also important that these bills be accurate. Overcharges irritate customers, and undercharges can mean lost revenues. Therefore, speed and accuracy are necessary for the number of bills drawn up every month in a business organization.

ACCOUNTING:

A successful business depends upon the accuracy of data. Many businesses use accounting software and ledger systems to ensure the accuracy of their financial position.

CUSTOMER INTERACTION

Computers are used in call centres, and they are used to answer customer’s questions, take payments and providing general assistance and information about the company’s products. The automated voice systems are available with 24 x 7 (all the time).

COMMUNICATION

Communication is the most important in business. A wide array of communication methods are provided by computers such as email, chat, web conferencing, video conferencing and VOIP.

INVENTORY CONTROL
The purpose of an inventory control system is: (1) to keep a low level of products and other items on hand and to reduce the costs of storing, handling and insuring a large number of goods, (2) maintain good customer relations by having the goods on hand when the customer orders. Output results produced by the inventory control management include

1. Updated records of individual inventory items
2. Management reports used to determine what items to reorder/discontinue , how much to reorder and which items have experienced unusual changes in demand. 

WEBSITES 
Websites are now essential for any business. Globalization of businesses, attracting new customers, create brand awareness, customer support, and other activities are all possible through websites of a business.

SOCIAL MEDIA

 Facebook, Twitter and some other social media sites are being used extensively by businesses, media houses and SOHO (Small Office/Home Office) businesses for advertising, and keeping in touch with their customers.  

ADVERTISING

Websites are the new medium for advertising. Companies can use the targeted advertising feature of websites. In targeted advertising, the actions, or searches performed by the website visitor are used to decide the product that is to be advertised.

Easy availability of presentation software and word processor mean that marketing documents can be prepared easily. Adobe Photoshop provides many templates that users can modify to produce nice marketing materials.

SALES ANALYSIS

It is the determination of the extent to which a sales force has met its sales objectives within the specified timeframe. Through sales analysis, a business becomes familiar with emerging trends in the marketplace. When sales fluctuate, it is an indication of new trends appearing in the market that the company needs to master in order to keep its sales on par with those of the competition. A company needs to be aware of which products the competitors are selling more to draw its strategy. Various charting tools in a spreadsheet-like Excel can help in viewing this trend, and also forecasting the future trends to a limited extent.

PROJECT MANAGEMENT

A project is usually a one-time operation with a series of tasks which must be completed over a limited time period. All organizations have projects that must be managed. For example, a hospital or school must build a new wing. A company must develop and introduce a new product, and so on.

A project management package is a software that helps managers plan, schedule and control the human and material resources required to complete project tasks on time and for a reasonable cost.

Examples of commercially available project management software are: Microsoft Project, Copper project.

RISK ANALYSIS

Risk analysis is defined as a procedure to identify threats & vulnerabilities, analyze them to ascertain the exposures, and highlight how the impact can be eliminated or reduced. Risk analysis is used for capital budgeting, insurance, investment sector, and project management.

MANAGEMENT INFORMATION SYSTEM

Management Information System (MIS) provides information to manage organizations efficiently.  MIS is mainly used to provide information to the middle and top-level management in an organization. This information is not concerned with the day-to-day activities but instead gives an overall picture of the working of a department, a product, etc.

ECOMMERCE

Electronic commerce is also called eCommerce. It is the buying and selling of products or services over the Internet. Electronic commerce uses technologies such as electronic funds transfer (EFT), supply chain management, Internet marketing, online transaction processing (OLTP), electronic data interchange (EDI), inventory management systems, and automated data collection systems. The World Wide Web is used at least at one point in the transaction's life-cycle, although it may also use other technologies such as email, mobile devices and telephones.

A few hugely successful examples of eCommerce are Amazon, Google Play, Flipkart, Myntra, UrbanPro, OLX, etc.

BUDGETING AND FORECASTING
In the business sector, Computers are used to prepare detailed budgets and forecasts for a business. They are also implemented to forecast future sales and business expansions. Spreadsheet programs such as Excel can also be used for budgeting and forecasting.

REVIEW QUESTIONS

1. Discuss the application of computers to billing.
2. Discuss the applications of computers in relation with advertising and sales.
3. What is ecommerce? Why is it so popular now? Name a few ecommerce sites not mentioned in this chapter.
4. Define the term MIS. For whom is it useful in an organization?
5. Explain ‘project management’.
6. What is sales analysis? Why is it necessary?