DATA PROCESSING
1. Computer Systems
In 1950 it was predicted that eight or ten electronic computers would be sufficient to handle all the scientific and business needs of the United States. Likewise, the chief executive officer of IBM advised the company not to invest time or money in developing computers because he foresaw a limited commercial market. But these predictions were proved totally inaccurate as the computer industry developed into a multibillion-dollar business. Today the computer plays a vital role in the lives of many Americans and is seen as one of the greatest technological developments of all times.
Basically a computer is an electronic machine that is capable of performing mathematical tasks to solve scientific or clerical problems in a relatively short period of time. There are two main elements of any computer system-hardware and software.
Hardware is the physical equipment, i.e. the machinery and electronic components. Certain tasks are performed by the hardware. In very simple terms, these tasks can be described in the following processes:
input ------------------> storage and/or manipulation ----------------------> output
properly prepared pieces of information known as data are put into the computer (input). They are put away for future use (storage) and/or handled for a specific purpose (manipulation). Finally, the results are made available to the users (output). The combination of these tasks is known as data processing.
Equally as important as hardware in the operation of computers is software. This term refers to the programs and procedures that make it possible to use the computer. A program is a detailed set of instructions that tells the computer what to do, how to do it, and the proper sequence of steps to follow. Programs are written in special computer languages by trained people called computer programmers. Programmers must be familiar with the computer language used in each program. There are a number of different computer languages used in data processing; COBOL (Common Business Oriented Language) is the one used most frequently in business computer applications.
The technological development of computer hardware and software has affected the modern world in numerous ways. Business is one of the areas in which the effect has been greatest.
2. The Role of Computers in Business
When first developed, computers were not use in business. It was not until the late 1950s that computers began to be used to organize, store, process, and present vast amounts of business information. In 1954 the first business application of a computer system was made for the processing of payroll. Today payroll is just one of many routine computer operations. There has been a rapid increase of computer usage into almost every aspect of business: factory production, inventory control, warehousing and distribution, record-keeping, and even assistance in problem-solving and decision-making.
Computers handle large amounts of data rapidly and can efficiently categorize, process, and report information for a variety of business operations. Computers, in fact, have a virtually in limited capacity for processing business data. However, since computers cannot think, their role in business is limited to choose areas in which they can process information more effectively and efficiently than human beings. Figure 2 lists a number of tasks and compares the effectiveness of computers and human beings for each task. At the administrative level, managers decide how computers and humans can be used most effectively to perform a particular business task.
Computers have become an integral part of day to day business transactions as well as analytic tools for long-range planning, research, and development. Even a small business can utilize computers by either purchasing a small unit known as a minicomputer, leasing one, or by time-sharing. In a time-sharing system, each user is regularly scheduled for time to use the computer system. A wide variety of businesses and individuals (for example, college students, engineers, and lawyers) participate in time-sharing computer systems.
By performing data processing tasks such as accounting and billing, computers are playing an increasingly important role in business. Currently, business are developing overall management information systems in which computers function as essential tools in problem-solving and decision-making at all administrative levels.
| RELATIVE EFFECTIVENESS OF COMPUTERS AND HUMAN BEINGS | ||
| Tasks Being Compared | Computers | Human Beings |
| Speed with which work is performed | Extremely fast | Fairly slow |
| Accuracy of work | Almost perfect | Somewhat inaccurate |
| Ability to remember and retrieve data | Perfect | Fairly poor |
| Ability to perform repetitive tasks | Excellent | Fairly poor |
| Ability to continue working without pause | Excellent | Poor |
| Ability to accept and follow instructions | Perfect | Inconsistent |
| Ability to addapt and innovate | None | Fairly good |
| Ability to learn by trial and error | None | Fairly good |
| Decision-making ability | None | Fairly good |
| Cost per unit of work | High, if volume is low | High, if volume is high |
| | ||
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