5 Advantages and Disadvantages of Information and Communication Technology in Business

By Danni White - Last Updated on February 2, 2023
Advantages of Information and Communication Technology

Information technology is often valued in the business sector because of the immediate rewards it offers users. It is nice to search for the meaning of a word or phrase and get the answer to your question within a matter of seconds. It is equally fulfilling to have the ability to connect with so many people at once regardless of where you are in the world. There are more benefits to IT than what one may see at the surface level, though.

The advantages of information and communication technology are numerous and revolutionary in nature especially when it comes to business and company growth.

5 Advantages and Disadvantages of Information and Communication Technology in Business

Read on to learn about the 5 advantages of information and communication technology in business!

  1. IT Improves Communication

    Emails changed the way that employees interacted with one another during the 90s. Many flocked to America Online to convey messages and found that responses to digital communication were much faster than that of sending someone a letter. The only thing that surpassed the old days of email communication was that of a telephone call.

    Now, thanks to smartphones and social media, an employee can get a response from colleagues within a matter of seconds if they use the right means. Information technology has also given birth to cloud computing, which lets employees access important information when they are not in the office. There is no need to connect to a hard drive when you are using cloud storage. The world of IT, then, cuts through the extra steps to make communication faster.

    Efficient communication is key to the success of a company, and IT helps to streamline communication. In a rapidly connected and vast business landscape, hiring, leveraging, and retaining employees requires continuous communication and collaborative efforts. A crucial benefit of IT is in its ability to streamline communication both externally and internally.

    For instance, video conferencing and online meeting platforms such as GoToMeeting, Zoom and Skype offer businesses the work remotely in real-time, greatly reducing costs that come with having clients on-site or interacting with employees who work remotely. Thanks to IT, businesses are able to connect and communicate almost effortlessly with international consumers and suppliers.

  1. IT Cuts Costs

    Of course, when you talk about eliminating steps in business, there is the possibility of saving money. One of the major 5 advantages of information technology is its ability to keep money in your company’s bank account. Some people are scared off by the notion of IT because of the upfront costs that sometimes feel overwhelming. The truth, though, is that an updated system pays for itself within a matter of weeks. Improved communication alone leads to more productivity and, thus, increased earnings. Information technology is an investment that all business owners should pursue.

    While it may initially appear expensive to implement IT, in the long run, it will however become significantly cost-effective by streamlining an organization’s managerial and operational processes. Basically, implementing information and communication technology in business allows businesses to achieve more with less, without compromising value or quality.

  1. IT Encourages Strategic Thinking

    Better communication leads to more critical thinking. Employees are less concerned with how to get into contact with co-workers when they know that they can relay information through the cloud. Thus, with the stress of figuring out how to communicate lifted, workers can take in the information shared and create better strategies for improvement. One of the advantages of data communication is, therefore, more time, which leads to more effective planning.

    IT can help an organization to enhance their competitive edge in the marketplace, by encouraging knowledge transfer and strategic thinking. For instance, by leveraging subscription databases and social networks, companies are enabled to organize, interpret and transmit data like never before. This has provided enterprises with unmatched access to consumers and customers, assisting companies to deliver better and innovative products.

  1. IT Protects Information

    There will always be a place for traditional files in the corporate sector. Leaving a paper trail, however, may not be the best idea when it comes to sensitive information. Identity thieves have a way of taking the simplest information, such as a name or birthdate and transforming it into a weapon that victimizes unsuspecting individuals. It is best, then to invest in information technology with encryptions and other security measures that keep unauthorized eyes from viewing classified information.

    In protecting classified information, information technology works to ward off lawsuits. Victims of identity theft often track down the source where thieves were able to steal information. It is not uncommon for such persons to sue companies responsible for damages related to the crime. Your decision to keep up-to-date with the latest technologies can essentially keep legal fees for negligence at bay.

  1. IT Cuts through Cultural Barriers

    Diversity is something that corporations continue to strive for despite laws in the United States that prohibit discrimination based on race, gender, sexual orientation, age and other factors that make a person uniquely different. The good thing about the IT world is artificial intelligence, which does not automatically come with the same filters of which humans are accustomed.

    A computer does not care if a person is a man or a woman if the potential candidate’s resume meets the predetermined qualifications for the job. Information technology, therefore, can contribute to diversity by design of operating systems.

Disadvantages of information and communication technology in business

  1. Reduction in available job opportunities for humans

    Organizations consider technology a better “employee” when it’s utilized in the production processes of the business. Not only can work be finished on time, but also certain processes can be automated for ease of operation. Hence, software tools have the capacity to perform tasks that are meant for human employees. The implication of this is that they have become a competition for humans as companies don’t see the need to hire as many individuals for jobs that can be carried out by fewer employees and a smart software.

    While this decrease in the demand for human labour may be good news to business employers, it is however not advantageous to human workers. When technology is employed instead of humans, business ventures see no essence of hiring them. Consequently, the rate of unemployment increases and the society has more people who are struggling to feed their household and pay their bills. It is thus important that companies understand how to employ human workers instead of simply laying them off as a result of technological advancements.

    For instance, it’s better if business enterprises can retrain their workers, and after the training, the employees should be reassigned to execute other roles and occupy new positions that machines cannot. Moreover, it’s pertinent to remember that technological devices will only function optimally when they are operated by skilled human employees.

  1. Advancement in technology has made employees anti-social

    Technology has introduced channels for individuals to communicate with each other without necessarily having to be within the same region. This is possible thanks to several communication tools such as Skype. As a result, business colleagues can hold conference meetings from different parts of the world.

    As wonderful as this is, the problem is that the bulk of human communication has moved online. Meanwhile, employees who have adopted the use of technological devices for the vast majority of their communications experience a deterioration in their social skills. There’s been a change in individual behaviors because they are used to spending most of their time using technological devices like laptops and mobile phones.

    But there is something businesses can do to resolve the issue. Not all conferences and communications should be carried out online. Business owners should organize particular periods in the year when their employees can meet physically and interact.

  1. Excessive dependence on technological devices

    As we all know, technological devices are useful in the automation of complicated enterprise processes. This is great for your company. However, all machines can breakdown at any point due to several factors. When that happens, production operations are suddenly halted and this can throw your business into a state of panic.

    When work is automated, people tend to depend too much on technological devices. As a result, they feel it is unnecessary to understand how these processes can be carried out manually. The entire business operation comes to a halt whenever there’s a problem with the technological devices. This is why as a business owner, you should not allow your operations to be solely dependent on technological applications.

    Train your workers so they know what to do whenever the technological applications are malfunctioning. In addition, you should have full manuals that specify what should be done to get the company and business operations ruining in the unforeseen case of a device failure.

  1. Costs of implementation and regulatory compliance

    It takes time and money to get new solutions implemented. Typically, business services become interrupted as new phases of the operations are implemented. Extra employee training is needed and customers may have to endure a decline in the quality of service during the process of the implementation.

    Organizations typically hire external contractors to execute the implementation of new hardware and software solutions. While Information Technology solutions have become less expensive with the improvements in technology, organizations that have extensive compliance requirements must ensure that they adhere by all regulations or they will stand the risk of legal actions and penalties.

  1. More and more data regulations

    In the modern world, information is huge business. This is why data protection and ethical usage of it are of paramount significance to regulatory authorities and lawmakers. Enterprise owners can not afford to be ignorant of what is involved in client data protection. Some sectors have much higher regulations than others, such as the financial services and healthcare industries, because in their day-to-day business operations, these businesses accumulate private and sensitive information from patients and clients.

    Nonetheless, just because you own a fashion store doesn’t mean you are free of regulations. The way you handle email lists; the process of confirming the age of the individuals you gather information on; and how you manage credit card data, is all regulated. Having preparation and adopting standard protocol is key to protecting your company and your clients.

Final Thoughts

The explanations above are just some of the advantages and disadvantages of using ICT in business. The good news is that there are procedures and policies that you can implement as a business owner in order to remedy the cons. In all, as your company embraces the use of information and communication technology in business, get ready to tackle the negative effects as well.

Danni White | Danni White is the CEO of DW Creative Consulting Agency, a digital marketing firm specializing in elevating the visibility of small-to-midsize businesses and nonprofits. She is the author of 17 books and hosts the #Hashtags and Habits Podcast, which merges digital marketing, entrepreneurship, and personal growth.

Danni White | Danni White is the CEO of DW Creative Consulting Agency, a digital marketing firm specializing in elevating the visibility of small-to-midsize busi...

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