Organisations who do not sell a specific product also use the same sales strategies. Charities keep customer databases and write appeal letters to the people on them.
ICT in Finance
How the finance department uses ICT will depend on the exact nature of the business. All organisations use computers but different systems are used in companies. For example a large company will have lots of systems written specifically for them but a small company will buy software off the shelf.
Income and Expenditure
An important role of the finance department is to account for the money they receive and spend - know as income and expenditure.
-
Income - Commercial organisation'=s earn money by selling products and public sector organisations l;like schools and hospitals receive money from the government.
-
Expenditure - The organisation needs money to pay suppliers, staff wages and other expenses such as taxes and repayment of any loans
The finance department keeps records of every item of income and expenditure, this process used to be done by hand in large books called ledgers but is mostly computerised today.
There are a number of important reasons to keep accurate records of income and expenditure.
- The organisation's owners need to know what has happened to their money
- Reduce the chances of the money being used improperly
- Enable the government to calculate the correct amount of tax payable
Organisations are required by law to produce accounts which summarise the financial transactions carried out. The two most important accounts are the profit and loss account and the balance sheet.
Computerised Accounts Packages
As each transaction of income and expenditure needs to be recorded and a permanent record kept, special software is used. This software will have the following features
- Keeps a permanent record of income and expenditure
- Individual transactions can be located quickly and easily
- Reports can be produced
- Accounts can be produced
- Invoices can be issued
Whenever the organisation issues an invoice the system will generate a unique invoice number allowing all transactions and payments to be tracked.
ICT & Operations
How the operations department uses ICT will depend on the exact nature of the business. All organisations use computers but different systems are used to control processes. Here are some common uses of ICT in the Operations function
Manufacturing Organisations
- CAD (Computer Aided Design)
- CAD software allows organisations to design and test new products without having to physically produce models. The design is made in a 3D view so it can be rotated to see different angles. The software allows tests to be done on screen and gives fairly accurate results.
- CAM (Computer Aided Manufacture)
- The information about the product that has been designed is fed into a CAM system, the information will include things such as dimensions and materials required. The CAM system can calculate how to manufacture the product. If robots are used they will be programmed via the CAM system. There may also be feedback from robots or machines with sensors to help the CAM system be more accurate.
- Software can be used to test the quality of the product, sensors may take weights & measurements or lasers can be used to check the thickness of coating materials. These systems can also feedback to a CAM system.
- SPC (Statistical Process Control)
Software used to analyse test results collected during the production stage. For example sensors could give feedback about the amount of paint used during a computer controlled manufacturing process. SPC software would then be used to analyse the data over a period of time to help eliminate waste or ensure a more efficient process.
Service organisations
- Software which monitors information about calls and staff productivity. Every time a customer calls the following information is monitored.
- Time before answered
- Lost calls (when customers hang up)
- Duration of call
- Operative(s) dealing with call
- Records call and stores digitally in case of dispute
- The following information is gathered about staff productivity.
- How many calls are answered
- Duration of calls
- How often are no calls being answered
- When staff are logged out (to visit the toilet etc)
- All of this information is analysed to find out when the busiest periods are, arrange staff levels and ensure that staff are working efficiently and effectively.
- Database systems are used to make and analyse bookings for service organisations in the leisure industry. Bookings are made and staff can see how many customers are expected or using the facilities at a given time. Records can be analysed to help with staff rotas and future promotions.
- EPOS (Electronic Point Of Sale)
- EPOS systems are the tills used in most shops and facilities. Any till where the operator doesn't have to actually type in the price is an EPOS system.
- At the lowest end of the EPOS chain are systems where you program in your prices and press the corresponding button to the item the customer orders or purchases. These systems are commonly used in pubs and facilities where you buy set price items from a small range.
- A sophisticated EPOS system is the one used in supermarkets. The tills and bar code scanners are part of the computer system in the store. The store system is linked to the main company pricing system and information about which price goes with which bar code is set centrally. Whenever your shopping is scanned at the till, not only are you charged the correct price but the goods you buy are removed from the stores inventory. This makes stock control easy as the computer can automatically re-order goods when they fall below a certain level.
ICT & Purchasing
The role of the purchasing department is to buy OR specify the suppliers for all equipment and services used by the organisation. Equipment will include parts needed to manufacture the product and also items needed to ensure the smooth running of the organisation, such as stationary and cleaning materials. Services will include contractors to carry out specific tasks and employees to run the business. ICT is used heavily by the purchasing department to ensure that they purchase the best quality materials for the lowest price possible.
The purchasing department has to manage the stock to ensure the smooth running of the organisation. If there is not enough stock then the organisation will not be able to supply their customers and they will go elsewhere. If there is too much stock it needs to be stored and will affect the finance department as money will be "tied up" in stock. The ideal solution is "just in time" purchasing which means the supplies arrive just as they are needed. To achieve a good stock control system is needed.
How ICT is used in Purchasing
- Delivery tracking - When an order has been placed the organisation can check the progress of the order to see when it will be delivered. Each order is given a Unique Reference Number (URN) which is the order's reference on the database. You can see an example of this when you make a purchase from a company such as Amazon.
- Automatic Stock Re-ordering - A good stock control system keeps an accurate record of what is currently in stock and has an automatic re-order level which will give a message (or place the order) when a certain level of stock has been reached. This sort of system is typically used in supermarkets to keep a good level of stock in store.