6.2. Types of Information Processing Systems

Manual systems

Some businesses process information flows using a paper-based information management system. These systems are sometimes called manual information processing systems, because they require a great deal of manual or physical effort on the part of staff to organise, file, store, retrieve, and communicate information to those who need it.

Manual systems rely on internal and external paper-based mail as well as upon the telephone system for the receipt and distribution of information.

Once new information such as details of sales to different customers has been received, it must be organised and sorted, usually by filing clerks working with filing cabinets or card index boxes. This method is both expensive and slow.

When past information has to be retrieved, it needs to be found by someone working with a paper-based filing system. Usually only one person at a time can work at a filing cabinet, so retrieval can be very slow. Because of the bulkiness of paper-based manual systems, they also tend to take up a large amount of space.

If the required information was originally misfiled, it could take a long time to find. When the information is eventually located and removed, no other member of staff can gain access to it while it is being worked on.

If further calculations need to be performed on the data - for example to calculate sales trends, or percentage changes over time - and the data then needs to be converted into graph form, this will require further effort by staff.

If the information subsequently needs to be communicated to a number of people, for example, department heads, this could require laborious work by secretaries to type, copy, and distribute the data.

For all of these reasons, manual information processing systems have been disappearing very quickly in businesses of all sizes, to be replaced with computerised information processing systems.

Electronic systems

Electronic or computerised systems comprise both hardware and software. Information can be stored on a computer, while the processing of information is carried out by a program held within computer software.

Computers provide a powerful and economical way of storing, sorting, analysing, and distributing information. For example, a firm may be able to cut its floor space requirements and costs by doing away with filing cabinets and storing material on computer disks instead.

Improvements in technology have expanded the capacity of businesses to retain and process ever increasing amounts of information.

Software applications

There are now thousands of different software packages available from different manufacturers. However, many perform the same or very similar functions, and can be grouped under common headings. The main types of software packages in use in business include:

Wordprocessing (WP). WP software applications are used for letter writing and basic report writing and have replaced typewriters in most businesses. The latest versions of many wordprocessors, like Word for Windows and WordPerfect, are very like desktop publishing packages (DTP).

Desktop publishing (DTP). DTP allows users to design a variety of complex page layouts using columns, boxes, diagrams and pictures, in the same way as a newspaper or magazine. DTP programs usually contain a wide variety of fonts (typefaces) and also a picture library to be used in documents. DTP now means that even the smallest firms can produce high-quality publicity and marketing materials using programs such as Aldus PageMaker, AmiPro, and Microsoft Publisher.

Databases. Databases are programs used to organise and store information. Their special feature is that they allow the user to ask quite complicated questions or queries of the information. Databases are often used to hold customer details such as names, addresses, and information about previous purchases, which is often sold on to other organisations. Databases can be linked with word-processing programs to allow the mailmerge of information. A mailmerge is a mailshot to a large number of people. The same letter is sent to all, but with a personalised name and address taken from database lists. Mailmerge provides a powerful and cheap means of marketing, and is made possible by the use of powerful computer databases.

CD-DVD databases. Increasingly computer software is being supplied on CD-DVD. CD-DVDs can store vast quantities of information on a single disk, The Microsoft Encarta encyclopaedia, for example, holds the equivalent of 28 volumes on one CD. CD-DVDs are particularly useful for storing databases, such as telephone directories and reference books. On computers equipped with sound cards and speakers, they also enable information to be more attractively presented, using sound, animated graphics, and video. This format is known as multimedia.

Spreadsheets. A spreadsheet is like a large piece of squared graph paper on a computer screen. Each square is called a cell. Cells can be filled with numbers, words, or formulas. Spreadsheets can be created so that the sheet will automatically sort data and make calculations with the numbers entered. This ability makes them very useful for asking 'What if' questions, or questions designed to show the impact of - say -employing more staff, or spending more on advertising on final figures such as profit or cash flow.

Spreadsheets are often used for budgeting and statistical analysis. Many spreadsheets, such as LOTUS 123 and Excel, can also convert numbers into graphs and charts, making them a very powerful means of processing numerical information.

Graphics packages. Graphics packages are designed to allow users to draw and make new designs quickly. Combined with a new generation of high-quality DeskJet and LaserJet colour printers, graphics packages such as Harvard Graphics and Freelance Graphics provide even the smallest of firms with the means to produce high-quality reports, logos, and publicity materials.

Computer-aided design (CAD). CAD packages allow the user to produce high-quality, detailed design drawings on computer. The best CAD packages allow 3D designs to be rotated and viewed from a variety of angles. Today many new products are designed using CAD packages.

In some high-technology factories, CAD packages are linked directly to Computer Numerically Controlled (CNC) machines, such as robots and automated production lines, which automatically produce what has been designed in the factory. This is known as computer-aided manufacture (CAM).

Multi-purpose and single-purpose systems. In the early days of computing, some computers could only be used for a single purpose, for example, word-processing or running a computerised payroll. These single-purpose machines were called dedicated computers.

Today, because of technological advances in hardware and software production, computers can be used for a variety of purposes. Most office information processing systems are used during the course of the week to write memos and letters, run the payroll, to produce budgets, design publicity material, and many other tasks.

This multi-purpose nature of computing has been assisted by the development of modular software packages. These comprise separate computer programs for different functions such as sales, purchases, cashbook, payroll, stock control, and VAT. Each program does its own job, but each also shares its information with the others and keeps them all updated. This enables all departments to share the same information. Popular modular accounts packages in use include Sage and Pegasus.

Electronic Data Interchange. Computer software can also be purchased to enable fast communication between computer users. This kind of software is called electronic mail or E-mail. Using E-mail, a memo or letter can be created and be simultaneously sent to any number of other staff on a computer network. It is possible to ‘clip’ a file produced using a word-processing package or any other software package to an E-mail message and then send it on.

The electronic transfer of information, known as Electronic Data Interchange (EDI) is a fast-growing computer application. EDI can replace all human involvement and transfer documents in seconds. Tesco has automated its business chain to such an extent that orders, invoices, and payments are all triggered off by shoppers passing through supermarket checkouts. No other human intervention is required. There are clear benefits of this in terms of speed and in reducing the time needed to get orders placed and delivered.