How Information Is Used

Organisations need to communicate with people inside the organisation as well as people outside the organisation (suppliers, customers).

It is important to identify:

• Who needs information

• Who sends it

• Who receives it

• How it is processed

How ICT is used to support the above activities will help to tell you how an organisation works.

It is common for an organisation to have a number of different ICT systems, each managing different types of information.

Sometimes some of these systems will not link to other systems within the organisation.

This may simply be due to history or a defined development strategy.

Systems that do not interact well may lead to inefficiency within an organisation.

For example, if sales use a different customer database from accounts, this will require duplication of work to maintain up to date records.

Also different versions of the same software can cause problems in the efficient flow of information.

Features of ICT Systems

Key features of ICT Systems include the following:

• Types of data and how it is organised

• Methods of data collection and data capture

• Methods of data processing, e.g. batch, on-line, real-time transaction, multi- access

• Data handling processes, e.g. sorting, merging, amending

• Types of software, e.g. application packages, specially designed systems.

It is important that you understand the key features of each system and, more importantly, the reasons for their use.

Typical ICT Systems

1 . Personnel and training systems

The personnel record system within an organisation is almost certainly linked to both the payroll and training record systems (if they exist).

Typically, it holds for example details of each employee's:

• name

• staff number

• address

• telephone number

• personal details

• current position

• employment history

• education

• skills

Most of this information will have been collected initially from the employee's job application form and entered via a keyboard.

The Information stored IS confidential and subject to the Data Protection Act (1998) and, as such, must be protected by appropriate security measures.

Depending on the size of the organisation, the information may be held in a simple relational or serial structure, or it may be indexed.

The processing carried out may include sorting records in order, selecting employee records that match specified criteria or searching for a specific employee.

Some of the information held within the personnel records may also be used as an input to management information systems (MIS).

This is particularly true in service organisations that rely heavily on the skills of individual employees.

Training records are a natural extension of personnel records.

Generally, only large organisations that have established staff development policies will maintain training records and training plans for employees.

Such records will generally consist of simple tables and include details of training levels reached on particular products or skills.

2. Accounts, finance and payroll systems

All organisations have some form of accounting or financial systems.

Such systems require speedy and accurate processing of multiple repetitive calculations in a standardised way but, unlike payrolls, are generally achieved using online processing.

Small organisations are most likely to use an application package for accounting and financial systems but larger organisations are most likely to have a tailor made system developed specifically for them through the processes of systems analysis and software development.

Financial and accounting systems are designed to track and process the money that comes into and goes out of an organisation.

As such, these systems form the cornerstone of the financial management of the organisation, and provide the basis for any financial planning or budgeting systems.

Financial and accounting systems are generally linked internally to most other systems within the organisation.

Particularly with such systems as order processing, stock control and management.

In larger organisations, these systems may also have external links to the Bankers Automated Clearing System (BACS), and sometimes direct links with customers and/or suppliers,

Because much of the information contained within financial and accounting systems is not only sensitive within the company, but could also be of value to other organisations, they will often be protected by some form of security.

Most organisations have a computerised payroll system, whether this is in-house or run by an external bureau. It is very often the first system that an organisation computerises.

A payroll system needs speedy and accurate processing of multiple repetitive and relatively complex calculations in a standardised way, generally using batch processing.

Tax codes, rates of pay and hours worked are all linked to the employee's staff number.

This information can be the subject of regular changes and needs to be kept up to date to ensure the accuracy of the payroll calculations.

The payroll information will usually be held in a simple relational or serial format.

Often there are links to communicate information externally to both the Inland Revenue and to BACS (to pay employees' wages directly in to their bank accounts), and to communicate information internally to the organisation's finance systems.

The system also produces pay slips automatically that may be mailed or given to the employee.

All payroll systems contain particularly confidential information to which rigorous security should be applied.

Most payroll systems are based on application packages but even tailor made systems rely on standard subroutines for tax and National Insurance calculations.

3. Research, design and development

Many of the systems used in the research and development (R&D) and design departments of large organisations will have been developed to meet the specific needs of the organisation's products or services.

However, many such departments also use other software:

• 2-D and 3-D modelling tools

• Graphic design packages

• CA D systems

• Production and project scheduling systems

Records will be kept on new products on trial, forecasts on how existing products will be saleable, areas for future development etc.

4. Sales and purchase orders

Sales order processing (often called SOP, or just order processing) is responsible for the management of orders and contracts placed by the customers of an organisation.

This is often implemented as a separate computer system, which generates an input link to sales when the product or service has been delivered and an invoice has been raised.

It is likely that the order processing system has a direct link into the stock control and production systems should they exist.

Many order processing systems will be integrated within an applications package with stock control.

The purchasing department within an organisation is responsible for raising purchase orders for all goods and services from suppliers.

As such, it creates the input for the purchase ledger system.

These purchase orders are used to check invoices received from suppliers.

5. Stock control

Stock or inventory control systems are generally found in organisations that either hold large numbers of items or small numbers of high value items, in store.

Each type of item is given a unique code either generated internally by the organisation, or as a code provided by a supplier.

Other information held in stock control systems includes number in stock, location, re-order levels, cost price, sales price and date received.

For high value items, there is usually a requirement to record individual item serial numbers.

Depending on the number of different items held in stock, the information is stored in either a relational or an indexed format.

Stock control systems often have internal links to such systems as order processing and production systems.

Sometimes they are linked to robotic picking systems within warehouses, but almost always have on-line or paper based links.

Very often stock re-ordering is an automatic process.

Purchase orders are automatically generated and sent to suppliers by the purchasing department.

In larger organisations and where delivery time-scales are critical, direct external links are made with suppliers.

If you telephone to order items from a mail order warehouse or catalogue the person you speak to is almost certainly using some form of computerised SOP system linked to stock control that can tell you immediately if the item is in stock.

This enables these organisations to ensure that customer orders are dealt with speedily and accurately.

Some form of security often protects these systems, because the information contained in them is sensitive both internally and externally.

6. Internal e-mail systems

More and more organisations are using e-mail as the prime method for internal communication with their employees.

It is very useful, not only to standardise procedures using selective mailing lists, but also to ensure fast communication of information.

However, this is a system that requires careful management to ensure that only the right people receive the right information.

Most email systems are based on applications packages.

7. Internet and Intranet

The Internet and Intranet, together with private LANs and WANs provide enormous opportunities for organisations to achieve speedy and efficient communications both internally and externally.

The Internet has provided organisations with the ability to provide not only access for its employees to external websites and information providers, but also the opportunity to promote its activities relatively easily and cost effectively to a potentially enormous marketplace including the facility for e- commerce.

An Intranet provides a further opportunity for organisations to communicate information within an internal closed network to all their employees.

Organisations use many other ICT systems that depend on communications:

• Video conferencing systems provide an organisation with the facility for its employees in different locations to not only talk to each other but to see each other as they do so.
  
  Such systems are used to reduce travel costs and to arrange meetings at short notice.

 

• EPOS (electronic point of sale) information is communicated across networks by many retail organisations.
  
  This enables such organisations to keep up-to-date information on all stock levels, prices and special discounts, etc. in all their head office and sales outlets.

 

• Fax on demand provides an organisation with the ability to offer potential customers the facility to telephone one of a number of dedicated telephone numbers, and by leaving their own fax number, receive the information associated with the selected number automatically.

8. Product manufacturing systems

The term manufacturing systems is used to describe any of the wide variety of systems that are provided to support organisations that actually make products. Any information system that automates any part of the production cycle is classed as a manufacturing system.

Such systems vary from simple systems that carry out bill of materials processing to systems that fully automate a complete production line.

Many manufacturing systems are based on packages but, in most cases, they are tailored considerably to meet the needs of a particular organisation.

In many industries, without the aid of these information systems, it would be impossible to manufacture certain products cost effectively.

JIT(Just in time) production systems are a very good example of a manufacturing system.

They use sophisticated production scheduling techniques to enable a organisation to minimise stock holdings while still meeting customer demand.

Glossary

Batch processing

Where the data to be input is collected to be processed together with little or no user interaction.

Bill of materials

Is a list of the parts needed to manufacture a single product.

Indexed

Each record has a unique index or key.

These are stored separately from the data.

This allows the records to be sorted more quickly.

On-line processing

The user interacts directly with the computer.

Relational structure

Data is stored in separate tables that are related to one another.

Serial structure

All data is stored in a single table in the order in which it was input.

Adapted from: Vocational A-level Information and Communication Technology