Importance And Functions of Information Technology

Information Technology is made up of both information and technology.

What is Information? This is processed data with a meaning or an organized, meaningful and useful interpretation of data.

What is Technology?  Technology is humans using objects (tools, machines, systems, and materials) to change the natural and human-made environment.

What are the characteristics of good Information?

  • It has to be accurate
  • Must be relevant to basic purposes
  • Complete in respect to the key elements of the problem
  • It has to be Timely (should be communicated in time to be used )
  • It has to be consistent and reliable
  • It has to be Up-to-date
  • Easy to understand
  • It has to be tailored to the needs of managers and end users

What are the characteristics of Technology?

  • Technology is human knowledge
  • Technology uses tools, materials and systems.
  • Its application will result into artifacts (human-made things )
  • Technology is developed by people to modify their environment.

Information technology has become a major driving force in many organizations. These organizations are seeking to get IT applications which can help them sell their products or services effectively. For example, by use of Internet, organizations or businesses are moving information faster and they also coordinate multiple activities to achieve efficiency. They also use the internet to sell their services or products. Information technology has changed businesses, education so many other sectors. In the business world it has helped in creating a ”networked economy” where businesses are linked with their suppliers, customers, manufacturers and business partners in real time. So in this case we look at Information Technology as an enabler and as an industry for the economic development. Below I have listed a few detailed points on the importance and functions of information technology.

Importance of Information Technology

Importance of information technology to users and organizations:

  • IT helps in re-engineering of work practices: re-engineering is the reshaping of business process to eliminate obstacles that prevent an organization from providing better services and products and to help the organization capitalize on its strength. Many organizations have used information technology tools to increase and improve on their production. For example, tools like data bases which enable centralization of information help users and organization transmit and transfer information in a timely manner. This information is used in carrying out productive decisions for the organization and it also improves on the customer care.

” Let’s say that a user in a financial  organization  like a Bank,  wants to serve a specific client in an organization, but they need some basic information about that client, they will simply use data stored on a centralized database and they will serve that client on time. ”


  • Speed: Users of information technology can use tools like computers to perform different tasks faster and accurately. A computer can perform multiple functions on the same time which can not be done by humans. This helps users perform a given task on time and it even reduces tension and stress at work. Computers have applications which can store data in a systematic way making it easy to understand and organize important facts. Another important tool is internet, this can be accessed any where at any given time, so users can easily interact with each other and exchange relevant information. Organizations can use internet to interact with their customers in real time and respond to their needs. Time is a basic factor in both business and life, so information technology speeds up the process of doing anything which saves both users and organizations time.


  • Consistency and accuracy: Even though information technology is managed by humans, it is more likely to be more accurate than humans. Users are well trained on how to use information technology tools. For example, an accountant will be trained on how to use accounting software like Quick-books to perform accounting tasks. This user has formal knowledge on all accounting basics and they are as well equipped with IT knowledge to help them carry out their accounting tasks using software.  The benefit in this is that, the user trained has formal knowledge on the subject in question and all they need is an IT tool which makes all their work easier and accurate.


  • Reliability: Information technology systems can run 24hrs 7 days a week. These systems can only be interrupted for repairs and maintenance which takes just a few hours and the system will be up for use. This is a win-win process for both organizations and customers who need the service in time. Let’s take a simple example of a Bank. This is a financial institution whose services are needed by the end-user on time. Banks use IT systems to deliver services like remote banking so customers can easily deposit money, withdraw money or print out bank statements with out coming to a physical main branch of that bank. IT experts make sure that these remote ATM machines and other remote banking systems are running all the time, they can do maintenance in the late hours when users are not active so that they do not interrupt the service when needed by the user.



Functions of information technology

  • Data capture: This is the process of compiling information. For example, electronic commerce companies like AMAZON.COM use internet cookies to capture data about a customer’s purchases via their website. So in this case, they use this data to suggest items to a user related to their previous orders via their website. Also uses internet cookies to monitor websites and content we search for online, then they use that data to suggest adverts tailored basing on our interests. Many online companies are using internet cookies to capture data as a way on increasing their sales and improve on their service because this data is used to tailor services basing on users needs.
  • Data Processing: This involves converting, analyzing, computing and producing all forms of data, information. After capturing data, the system must re-organize that data basing on what the organization wants to use that information for. For example, when an e-commerce website captures data about your previous purchases via their website. Their system can organize that data inform of prices, products of interest, categories of interest, period of purchase etc , and this data will be used next time when a user goes back to that e-store to suggest relevant products.
  • Generation of Information: This involves organizing information into a useful form.


  • Storage of information: This involves retaining information for future use. The best example is ‘‘” This is a social network which connects people, but upon registering with the network , the user will provide their interests , profession , background information like former college , etc…. Then facebook will use this information to suggest friends to that user. The other trick is that Facebook will still use the same information when suggesting Adverts to this user. On their platform, advertisers can tailor adverts basing on users interests, location and sex. All this data is provided by the user upon registration.


  • Retrieval of Information: It is process by which a computer device is used to find and copy data for further distribution and processing.  A good example on this is a ”Search Engine like Google , Bing , Yahoo ” these companies have data centers which store information which can be used at a latter stage by the end user who will be searching for information online. They have robots which crawl and find information on website servers, this information is indexed and cached on data centers. So at a latter stage, users of search engines like Google will query this stored data to process information they desire.

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