How do businesses use information?

Information in a business can be presented in a number of different ways, and it can also come from inside with business and from outside.

INTERNAL INFORMATION / This information comes from inside the business e.g. company reports from other years, internal e-mails between employees or minutes from department meetings
EXTERNAL INFORMATION / This information comes from outside the business e.g. from suppliers, competitors or customer surveys, press articles.

Recently, the Internet has become a great source of information for business, it can help organisations keep track of what their competitors are doing so they can challenge them in the best way.

Information can be transmitted in a number of ways. These include:

Verbal / Information that is transmitted through voice or word of mouth e.g. phone calls, voice mails or face-to-face conversations
Written / Information that is written down and transmitted, e.g. letters, memos, telephone books.
Numerical / Information that is represented by numbers, spreadsheets or tables e.g. employees; wages, sales figures, accounts
Graphic / Pictorial / Graphic information is transmitted using graphs and charts e.g. bar charts or pie charts. Pictorial information is transmitted on posters or illustrations and presentations
Electronic / Information that is transmitted using technology. This can be shown on screen, or paper. Electronic information includes e-mails, teletext, fax, Internet, databases and spreadsheets.

It is very important that businesses have access to good information. Businesses have to make sure that information is given quickly, accurately, as efficiently as possible and politely. If information is not communicated quickly and correctly, then it could mean the business loses custom.

Information is used by managers to MAKE DECISIONS. The better the quality of the information, the better the decisions that can be made by managers; this will have a huge impact on the success or failure of the organisation. There are seven features of good information.

Features of good information are:

Relevant Information should be related to what it is being used for e.g. Sales figures information would be given to Sales staff, and not to the office cleaner, this is because it is only relevant to Sales staff.

Accurate Information should be completely correct – it should not have any errors.

Cost effective Information gained should be appropriate compared to the amount of time and money it costs to collect it. The intended use of the information should be taken into account.

Timely Information should be available before decisions are made. If it is not available at the time before decisions are made then it is of very little use, however the right information at the right time can be a very valuable resource.

Concise The people using the information need it to be of a high quality, easy to use and read, therefore there is no point in having information in a 20 page report if the same message could be communicated in a one page letter

Meaningful Information must be clear and easily understood by the people using it, otherwise the information loses its usefulness and value

Up to date All information used to make decisions should be fresh and not past its sell by date. If decisions are made on out of date or old information then the business could suffer.

All decisions taken by a business are based on information – the better the quality of information available, the better the chance if the right decision. Decisions will be based on internal information, external information and a combination of internal and external sources.

New Technology, I.T and Information

A major source of information comes from huge amount of information generated by using Information Technology and software packages. Software packages can perform lots of different functions and tasks which help businesses get the information they need, and helps them meet their aims and goals.

Information that is generated using technology is much faster than traditional ways, it can also be changed more easily. There is also a huge amount of information available to businesses through the Internet. There are a number of different software that businesses use regularly to help meet their aims.

Spreadsheets (Microsoft Excel)

Spreadsheets are normally used in the financial area of a business. The can be used to prepare accounting information, salary and wage calculations. Number information can be presented in different ways including in charts and graphs; showing information in this way can make it easier to understand, and making it easier to understand, it could be more useful when it comes to the business making big decisions.

Databases (Microsoft Access)

Databases are like electronic filing cabinets – they are a way of storing lots of information in an organised way. Records can be created, stored, edited, and updated easily, and this means that the business can be more efficient. Examples of databases could be employee records, stock records and sales records.

Desktop Publishing

Desktop Publishing (DTP) software allows information to be presented in an attractive and eye-catching way. DTP software can be used to prepare reports, business plans, brochures, flyers and notices and these can be used both internally and externally.

Word Processing (Microsoft Word)

This software allows information to be entered into the computer, stored, edited, formatted and printed quickly and easily. It allows information to be available in a readable, quality format for internal and external use. Most often word processing software is used for preparing letters and business reports.

E-mail and Internet

E-mail makes it quick, easy and cheap to exchange messages both internally and externally. E-mail messages can be sent between individuals, groups of people or between businesses. As well as basic messages, files, pictures and reports can be attached to the e-mails making them more powerful for business communications.

The Internet allows businesses to communicate information to their customers all over the world, selling through their website, advertising or generally giving information about products, services or special offers.