The Impact of ICT on Business Activity (AQA GCSE Business)

An Introduction to ICT & Business Activity

• ICT systems include computers and communications technologies that are used widely in businesses

• Examples include:

  • Details of customers held in databases

  • Employee record-keeping

  • Computer-based product design (CAD systems)

  • Video-conferencing systems

  • Storage of business documents

  • Planning and scheduling software

  • Computer-controlled manufacturing (CAM systems)

• The technology available for businesses to improve efficiency, flexibility and productivity is growing all the time

  • In recent years, advances in technology have been instrumental in

    • Enabling employees to work remotely

      • While employees require IT equipment to work from home, businesses can enjoy significantly reduced operating costs

    • Making internal business communication quicker and more secure

      • Important files can be encrypted and distributed, with several individuals contributing to the same file at any one time

    • Automating design and production processes

      • Products can developed quickly, allowing them to reach the market before those of rivals

    • Communicating with customers in interactive ways

      • Social media allows businesses to share content such as images, videos and hyperlinks

    • Collecting and organising vast amounts of data

      • The internet of things and the large amount of data from online interactions can be used to inform product development and marketing decisions

E-Commerce

• E-commerce is the trade of goods and services over the internet

• A wide range of goods and services can be purchased online

  • Goods, include tangible items such as clothing, household goods, toys and even vehicles

  • Services, include non tangible items such as insurance, entertainment and study materials

• Businesses can trade through their own websites

  • Top UK companies for e-commerce sales include Argos, Next, Dunelm and Screwfix

    • Argos's website receives more than 42 million visits each month

• Online platforms offer small businesses the chance to sell their products online

  • E.g. Amazon is a third-party logistics provider (3PLs) which provides a trusted platform for other businesses to generate sales

  • It provides infrastructure and an online marketplace

    • This allows small businesses to reach a wide audience and increase sales without having to invest in their own distribution infrastructure

• The proportion of retail sales made using e-commerce has been increasing steadily since the mid-2010s

  • Its growth accelerated during the COVID-19 pandemic, as consumers were unable to access most of their favourite high street stores

Diagram: UK E-Commerce Revenue (£bn) 2015 to 2021

E-commerce revenue has grown significantly since 2015, boosted by the Covid-19 pandemic in 2020

Source: Office for National Statistics

• E-commerce can make purchasing convenient for customers and is a source of competitive advantage for businesses

Evaluation of E-commerce for Businesses and Consumers

Digital Communication

• Digital communication refers to the use of electronic devices to transfer information

  • Devices include desktop and laptop computers, tablets and smartphones

  • Applications that enable digital communications include:

    • Email

    • Instant messaging, e.g. WhatsApp

    • Chatbots

    • Videoconferencing, e.g. Google Meet or FaceTime

    • Social media apps, e.g. Instagram, LinkedIn, or Facebook

    • Webchat apps, e.g. Slack

    • Shared drives, e.g. Google Drive or Dropbox

• These digital communication tools have helped businesses improve communications with their stakeholders

Digital Communication and Stakeholders