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3.1. Overview of the History, Importance and Types of

Computers

A Brief Computer History

Computers are such an integral part of our everyday life now most people take
them and what they have added to life totally for granted. Even more so the
generation who have grown from infancy within the global desktop and laptop
revolution since the 1980s.

The history of the computer goes back several decades however and there are
five definable generations of computers. Each generation is defined by a
significant technological development that changes fundamentally how
computers operate – leading to more compact, less expensive, but more
powerful, efficient and robust machines.

1940 – 1956: First Generation – Vacuum Tubes

These early computers used vacuum tubes as circuitry and magnetic drums for
memory. As a result they were enormous, literally taking up entire rooms and
costing a fortune to run. These were inefficient materials which generated a lot
of heat, sucked huge electricity and subsequently generated a lot of heat which
caused ongoing breakdowns.

These first generation computers relied on ‘machine language’ (which is the

most basic programming language that can be understood by computers).
These computers were limited to solving one problem at a time. Input was
based on punched cards and paper tape. Output came out on print-outs.
1956 – 1963: Second Generation – Transistors

The replacement of vacuum tubes by transistors saw the advent of the second
generation of computing. Although first invented in 1947, transistors weren’t
used significantly in computers until the end of the 1950s. They were a big
improvement over the vacuum tube, despite still subjecting computers to

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damaging levels of heat. However they were hugely superior to the vacuum
tubes, making computers smaller, faster, cheaper and less heavy on electricity
use. They still relied on punched card for input/printouts.

1964 – 1971: Third Generation – Integrated Circuits

By this phase, transistors were now being miniaturized and put on silicon
chips (called semiconductors). This led to a massive increase in speed and
efficiency of these machines. These were the first computers where users
interacted using keyboards and monitors who interfaced with an operating
system, a significant leap up from the punch cards and printouts. This enabled
these machines to run several applications at once using a central program
which functioned to monitor memory. As a result of these advances which
again made machines cheaper and smaller, a new mass market of users
emerged during the ‘60s.

1972 – 2010: Fourth Generation – Microprocessors

This revolution can be summed in one word: Intel. The chip-maker developed
the Intel 4004 chip in 1971, which positioned all computer components (CPU,
memory, input/output controls) onto a single chip. What filled a room in the
1940s now fit in the palm of the hand. The Intel chip housed thousands of
integrated circuits. The year 1981 saw the first ever computer (IBM) specifically
designed for home use and 1984 saw the Macintosh introduced by Apple.
Microprocessors even moved beyond the realm of computers and into an
increasing number of everyday products.

The increased power of these small computers meant they could be linked,
creating networks. Which ultimately led to the development, birth and rapid
evolution of the Internet. Other major advances during this period have been
the Graphical user interface (GUI), the mouse and more recently the
astounding advances in lap-top capability and hand-held devices.

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2010- : Fifth Generation – Artificial Intelligence

Computer devices with artificial intelligence are still in development, but some
of these technologies are beginning to emerge and be used such as voice
recognition. AI is a reality made possible by using parallel processing and
superconductors. Leaning to the future, computers will be radically
transformed again by quantum computation, molecular and nano technology.
The essence of fifth generation will be using these technologies to ultimately
create machines which can process and respond to natural language, and have
capability to learn and organize themselves.

Importance of Computers in Business.

Personal computers have helped workers in business perform their jobs more
efficiency, since their introduction in the 1980s. Routine functions such as
sending memos can instead be done by email. Workers can search information
from the Internet with a click of the button. The importance of computers in
business also has many other positive benefits in the work force.

The importance of computers in business includes money saved for various

business activities. For example, a small business can maintain a database of
customers in its computer. The business can then send coupons or special
promotions to these customers by email. Companies also save on paper costs
when interacting through their computers. Also, a small manufacturing
company can automate part of its production line with computers. The
automation process would help the manufacturer cut back on labor costs.

Computers also help the businessman save time. For example, a businessman
can write a report, do a spell check, edit it and distribute the report in just a
few hours--even long distance. Previously, companies used typewriters for
reports where reductions were made on various pages. These pages then
needed to be retyped until the report was error free. Managers then needed to

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copy the reports and mail them to employees in different cities. Consequently,
the report writing process took much longer with a typewriter than a computer.
Also, utility and cable companies can pinpoint a customer's problems more
readily with computers.

Computers in business allow for greater interaction among employees,

agencies, clients and customers. Managers can conduct conference calls, show
training videos and even conduct webinars or web-based seminars online with
computers. This inter-connectivity between businesses, clients or customers
can even be administered internationally. Human resource managers can more
readily collect resumes from job applicants through computers and the
Internet. Moreover, architects can create virtual models of their buildings and
check for dimensional accuracies.

Worker productivity is also enhanced through the use of computers. People

used to write presentations by hand, and then have a secretary type up the
presentation. Often, the manager's or employee's presentation would sit in an
"In" box along with other employees' projects. The secretary then, in turn,
typed up the presentations or information in the order she received it.
Computers allow workers to be much more productive than methods used in
the past.

Small companies and business owners can appear much more professional
and even larger by using computers, according to Entrepreneur.com. Various
publishing or document software enable small managers to type of
professional-looking documents. Small companies can also create websites that
rival those of large corporations. Consequently, a small business may
sometimes acquire clients more easily because of the company's computer-
enhanced image.

Types of Computers

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A computer is one of the most brilliant inventions of mankind. Thanks to

computer technology, we have been able to achieve storage and processing of
huge amounts of data. We can rest our brains by employing computer memory
capacities for information storage. Owing to computers, we have been able to
achieve higher processing speeds, carry out critical transactions and that too
with great precision and accuracy. Computers of the earlier times were of the
size of a large room and required to consume huge amounts of electric power.
However, with the advancing technology, computers have shrunk to the size of
a small watch.
✦ Mainframe Computers: Large companies and government organizations use
mainframes for highly critical applications such as bulk data processing like
transaction processing, census information, statistical data and so on and
ERP. Most of the mainframe computers have capacities to host multiple
operating systems and operate as a number of virtual machines. They can
substitute for several small servers. They consist of extensive input and, output
facilities, are very stable and dependable and handle millions of transactions
every day. Banks, educational institutions and insurance companies use main
frame computers to store data about their customers, students and insurance
policy holders.
✦ Microcomputers: A computer with a microprocessor and its central
processing unit is known as a microcomputer. Desk top computers, laptops,
personal digital assistant (PDA), tablets and smart phones are all types of
microcomputers. The micro computers are widely used and the fastest growing
computers. These computers are the cheapest among the other three types of
computers. The micro computers are specially designed for general usage like
entertainment, education and work purposes. Well known manufacturers of
micro computers are Dell, Apple, Samsung, Sony and To shiba. They do not
occupy space as much as mainframes do. When supplemented with a keyboard
and a mouse, microcomputers can be called personal computers. A monitor, a

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keyboard and other similar input-output devices, computer memory in the

form of RAM and a power supply unit come packaged in a microcomputer.
These computers can fit on desks or tables and prove to be the best choice for
single-user tasks.
✦ Minicomputers: These are used by small businesses and firms.
Minicomputers are also called as ‘’mid range computers’’ these are small
machines and can be accommodated on a disk with not as processing and data
storage capabilities as super- computers and main frames. These computers
are not designed for a single user. Individual departments of a large company
or organizations use mini-computers for specific purposes. For example, a
production department can use mini-computers for monitoring certain
production process. In terms of size and processing capacity, minicomputers lie
in between mainframes and microcomputers. Minicomputers are also called
mid-range systems or workstations.
✦ Supercomputers: The most powerful computers in terms of performance
and data processing are the super computers. These are specialized and task
specific computers used by large organizations. The super computers are very
expensive and very large in size. The highly calculation-intensive tasks can be
effectively performed by means of supercomputers. Scientific research, oil and
natural gas exploration, Space exploration( eg NASA uses super computers for
launching space shuttles controlling them and for space exploration purpose),
earth quake studies, Quantum physics, mechanics, weather forecasting,
molecular theory, nuclear weapons testing, are best studied by means of
supercomputers. Their ability of parallel processing and their well-designed
memory hierarchy give the supercomputers, large transaction processing
powers. Super computers are the fastest computers with large data storage
capacity. It is the leader in processing capacity and costs millions of dollars
3.2. Computer Hardware

Hardware describes the physical components of a computer system which can

be categorized as input devices, a central processing unit, internal and external

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memory and output devices. Input devices are used to capture or enter data in
to the computer. The central processing unit (CPU) performs processing by
carrying out instructions given in the form of computer programs. Internal
memory is used as a temporary means of storage data and instructions while
external memory provides a means of storing data and programs outside of the
computer. Output devices translate the results of processing in to a human-
readable form.
Input Devices
Input devices are used to enter data or instructions from outside the computer
in to the computer. A mouse, touch ball, screens, pens, remote sensors,
barcode readers, optical scanners and key board are examples of input devices.
The choice of an input device will often depend up on the quantity of data to be
entered. Entering data on a small scale is normally carried out by human
operators, using a number of familiar input devices, such as the mouse or key
board. A computer- based information system will seldom make use of only a
single input device. Even a typical personal computer will often feature several
different methods for data entry, such as key board, mouse joy stick and sound
card.

Central Processing Unit (CPU)

The CPU or processor accepts instructions and data and executes them storing
the results in memory. The increased speed of computers is primarily a result
of increasing CPU speeds. The speed of a processor will depend up on a
number of different factors, such as the clock speed and bus width. The clock
speed determines how many instructions
Internal and External Memory
Computer memory is categorized as internal memory ( also called main
memory or primary memory) which is data held on the computer and external
memory ( also called external storage) which is data stored on a separate device
where the information will be retained even if the machine is switched off
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computer memory is used to store data awaiting processing, instructions

loaded from software which are used to process data or control the computer
system and data or information that has been processed. Floppy, hard disks,
CD-ROM and magnetic tape are examples of external memory.
Out Put Devices
Output devices display the results of computer processing. A computer based
information system will make use of a number of output devices as a monitor,
microphone, printer, screen, audio speaker and sound card.

3.3. Computer Software

Computer Software Definition

Soft ware: Is a set of programs, which is designed to perform a well defined

function. A program is a sequence of instruction written to solve a particular
problem.

Types of Soft Ware

1. System Soft Ware
2. Application Soft Ware
1. System Software: Is the collection of programs designed to operate,
control and extend the processing capabilities of the computer itself.
They are generally prepared by computer manufacturers
Features of System Software
 It is close to system
 It is fast in speed
 It is difficult to manipulate
 It is smaller in size
 It is difficult to design
 It is difficult to understand
 It is generally written in low level language
Types of System Soft Ware

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1. System Control Program: They control the execution of programs. Eg.

Operating system device drivers- device drivers are system programs
which are responsible for proper functioning of device. Eg. Device like
printer, a user must load the device driver of that particular printer.
2. System Support Program: They provide routine service function to other
computer programs and users. Eg. Utility programs
Some utility programs are:
 Text editors: They are used to create and edit files. Eg. Note pad is
the text editor
 Backup utilities: These utility programs help us to back up of our
important data. By using these programs files are backed up to
floppies, CD and DVD.
 Data recovery soft ware: Sometimes an illegal operation may
result in an accidental loss of data which was still to be needed
then we used data recovery soft ware. Eg. Recycle bin
 Compression utilities: Are used to compress large sized files so
that they can be stored in storage of low capacity. Win-zip is a
popular compression utility used in window based desktops.
 Anti-virus utility: Any program that affects the normal working of
the other programs or affects the boot sector of the disk is a virus.
The anti-virus software detects the virus, identify and prevent it
from spreading. Some examples of anti-virus soft ware are Norton’s
anti-virus, MCafee etc.
3. System Development Program: They assist in the creation of computer
programs. Eg. Programming language, language translation.
2. Application Soft Ware: Are the software that are designed to satisfy a
particular need of a particular environment. All software prepared by us
in the computer lab. Examples of application software are; student
record software, rail way reservation soft ware, income tax soft ware,
word processors etc.

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Features of Application Soft Ware

o It is close to user
o It is slow in speed
o It is easy to understand
o It is easy to manipulate
o It is generally written in high level language
o It is easy to design
Types of Application Soft Ware
1. General Purpose Application Software: Are designed to satisfy
common needs of various businesses. Eg
A. Word Processor: Is the software used to word processing.
There are many word processors available in the market. The
common and the popular among are: word star, ms-word.
B. Electronic Spread Sheet: A spreadsheet contains greed of
cells arranged in columns and rows. Data is entered in to the
cells to represent information. Eg. Lotus 1,2,3 and excel.
C. Presentation Software: Presentation are the software which
are used to present information to a large number of people.
Eg. Microsoft power point is one of the most popular
presentation software.
D. Desk Top Publishing Software: Are used for typesetting and
designing purposes. Eg. Page maker
E. Web Browser Software: With an internet connection, this
type of software enables a user to visit from one site to
another by following, to search locations and view web
documents. Eg. Microsft internet explorer
2. Special Purpose Application Soft Ware: Are created to satisfy
specific needs of an organization. Eg. Payroll software, rail way
reservation soft ware etc.

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3.4. Telecommunications Network

Telecommunications is pertaining to the transmission of signals over long

distances, including not only data communications, but also the transmission
of images and voices using radio, television and other telecommunication
technologies. It is the sending of information in any form ( voice, data, text, and
images) from one place to the other using electronic or light emitting media.
Data communication is a more specific term that describes the transmitting
and receiving of data over communication links between one or more computer
systems and a variety of input or output terminals. The integration of computer
based information processing with telecommunications and telephone
technologies.

Business Applications of Telecommunications

Table 3.1: Business Telecommunication

Telecommunication Networks
Enterprise Collaboration Electronic mail, voice mail, discussion
forums, data conferencing, video
conferencing, electronic meeting
system
Electronic Commerce Systems Online point of sale transaction
processing, web retailing and
wholesaling, electronic data
interchange, electronic fund transfer,
electronic banking, interactive
marketing, supply chain management
Internal Business Systems Internal transaction processing,
inquiry processing, intranet web
publishing, work flow system, activity
monitoring, process control,

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management support system

Business values of telecommunication

Overcome Geographic Barriers: it captures information about the
business transaction from remote locations.
Overcome Time Barriers: it provides information to remote location
immediately after it is requested.
Overcome Cost Barrier: it reduces the cost of more traditional means of
communication
Overcome Structural Barriers: support linkage for competitive
advantage
Telecommunication Network Model
Telecommunication network is an arrangement where a sender transmits a
message to a receiver over a channel consisting of some type of media.
1. Terminals: Terminals are the starting and stopping points in any
telecommunication network environment. Any input or output device
that is used to transmit or receive data can be classified as a terminal
component. Terminals are networked personal computers, network
computers or video terminals from where a network can be accessed.
2. Telecommunication Processor: Telecommunications processors
support data transmission and reception between terminals and
computers by providing a variety of control and support functions.
They convert data from digital to analog and back.
Telecommunication processors support data transmission and
reception between terminals and computer. They code and decode
data, control the speed, accuracy and efficiency of the communication
flow between computers and terminals in computer networks.
Examples of telecommunication processors include modems,
switches, neuters, multiplier, and hub.

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3. Telecommunication Channels: Telecommunications channels are

the way by which data is transmitted and received.
Telecommunication channels are created through a variety of media of
which the most popular include copper wires and coaxial cables.
Fiber-optic cables are increasingly used to bring faster and more
robust connections to businesses and homes
4. Computers: In a telecommunication environment, computers are
connected through media to perform their communication
assignments.
5. Telecommunications Control Software: Telecommunications control
soft ware is present on all networked computers and is responsible for
controlling network activities and functionality. Telecommunication
control software is program that control telecommunications activities
and manage the functions of telecommunication networks.
Types of Telecommunication Networks
In its most basic form a network is an interconnected system of things or
people. From a technical stand point a network is a data communication
system that interconnects computer systems at different sites or the
connection of two or more computers using a communications system. Most
networks can be classified in to one of the following different types. These
include.
Wide Area Network (WAN): Any network that encompasses a large geographic
area is referred to as a WAN or wide area network. Many large businesses and
government agencies use WANs to keep their employees and citizens connected
as well as provide a quick and effective way to send and receive information.
Metropolitant Area Network (MAN): A MAN is a net work that covers a
region, often is bigger than a local area network and smaller than a WAN and
consists of several interconnected LANS. This network often serves regional
businesses that have several locations throughout the region or entire cities

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Campus Area Network (CAN): A CAN is a network that is restricted to a small

geographic area such as a building complex or a college campus. It is smaller
than a MAN but larger than a LAN
Local Area Network (LAN): Similar in many ways to WANs; LANs are
responsible for connecting computers in a much a smaller limited physical
area. A good example of a LANs would be a hotel’s wireless Internet offering,
which is self-contained within their own facility.
Personal Area Network (PAN): PAN is a network that is restricted to the area
of a person’s body. It is much smaller than a LAN. It typically incorporates
adhoc connections to other panes or directly to Bluetooth devices.
Virtual Private Network (VPN): Virtual private networks or VPN are a type of
network that builds off of the concept of a WAN, however, relies up on the
internet and an encrypted connection mechanism to establish a secure
environment for internal or external employees or customers.
Intranets and Extranets: The majority of Internet services are available to
any business or consumer that has access to the Internet. However, many
business applications that access sensitive company information require
access to be limited to favoured individuals or third parties. If information is
limited to those inside an organization the network is termed an intranet. If
access is extended to some others, but not everyone beyond the organization,
the network is termed an extranet. Extranets can be accessed by authorized
people outside the company such as collaborators, suppliers or major
customers, but information is not available to everyone with an Internet
connection but restricted using pass word access. Intranets are also used for
sharing information such as staff phone directories, staff procedures or quality
manuals, information for agents such as product specifications, current list
and discounted prices, competitor information, factory schedules and stocking
levels- all this information normally has to be up dated frequently and can be
costly. Extranets are used extensively to support activities such as ordering
from suppliers.

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Network Topology
Some of the most common topologies in use today include:

 Bus - Each node is daisy-chained (connected one right after the other)
along the same backbone, similar to Christmas lights. Information sent
from a node travels along the backbone until it reaches its destination
node. Each end of a bus network must be terminated with a resistor to
keep the signal that is sent by a node across the network from bouncing
back when it reaches the end of the cable.

 Ring - Like a bus network, rings have the nodes daisy-chained. The
difference is that the end of the network comes back around to the first
node, creating a complete circuit. In a ring network, each node takes a
turn sending and receiving information through the use of a token. The
token, along with any data, is sent from the first node to the second
node, which extracts the data addressed to it and adds any data it
wishes to send. Then, the second node passes the token and data to the
third node, and so on until it comes back around to the first node again.
Only the node with the token is allowed to send data. All other nodes
must wait for the token to come to them.

 Star - In a star network, each node is connected to a central device

called a hub. The hub takes a signal that comes from any node and
passes it along to all the other nodes in the network. A hub does not
perform any type of filtering or routing of the data. It is simply a junction
that joins all the different nodes together.

 Star bus - Probably the most common network topology in use today,
star bus combines elements of the star and bus topologies to create a
versatile network environment. Nodes in particular areas are connected
to hubs (creating stars), and the hubs are connected together along the
network backbone (like a bus network).

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3.5. Data Resource Management

Data are a vital organizational resource that needs to be managed like other
important business assets. Today’s business enterprises cannot survive or
succeed without quality data about their internal operations and external
environment. That is why organizations and their managers need to practice
data resource management, a managerial activity that applies information
systems technologies like database management, data ware housing, and other
data management tools to the task of managing an organization’s data resource
to meet the information needs of their business stakeholders.
Organizing Data
In earlier times, data processing was done manually. Organizations appoint a
large number of people called clerks. The information technology devices used
at that time was forms, ledger books and basic mechanical adding machines.
The results of such manual operations were obtained at a time when the
information was almost out of date (e.g. census). Things have changed
considerably with the advent of computers. There are a few terms that you
need to know about the data organization
Bit: A bit (short for binary digit) is the smallest unit of data in a computer. A
bit has a single binary value, either o or 1. Although computers usually provide
instructions that can test and manipulate bits, they generally are designed to
store data and execute instructions in bit multiples called bytes. In most
computer systems, there are eight bits in a byte.
Byte: In most computer systems, a byte is a unit of data that is eight binary
digits long. A byte is the unit most computers use to represent a character
such as a letter, number, or typographical (for example, ‘’g’’, ‘’5’’,or ‘’?’’). a byte
can also hold a string of bits that need to be used in some larger unit for
application purposes.
Field: A field is an area in a fixed or known location in a unit of data such as a
record, message header, or computer instruction that has a purpose and
usually a fixed size. Fields are organized in to records, which contain all the

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information within the table relevant to a specific entity. For example, in a

table called customer contact information, telephone number would likely be a
field in a row that would also contain other fields such as street address and
city. The records make up the table rows and the fields make up the columns
Record: In a data base, a record ( sometimes called a row) is a group of fields
with in a table that are relevant to a specific entity. For example, in a table
called customer contact information, a row would likely contain fields such as:
ID number, name, street address, city, telephone number and so on.
File: In data processing, using an office metaphor, a file is a related collection
of records. For example, you might put the records you have on each of your
customers in a file. In turn, each record would consist of field for individual
data items, such as customer name, customer number, customer address and
so forth.
Data Base: A data base is a collection of information that is organized so that it
can easily be accessed, managed, and updated. In one view, databases can be
classified according to types of content: bibliographic, full-text,, numeric and
images. In relation to data base, an entity means a person, place, or thing that
we wish to collect information on ( eg. Customer). Attribute is a characteristic
of an entity ( eg. Customer’s salary, Customer’s address)
Types of Data Bases
Continuing development in information technology and its business application
have resulted in the evolution of several major types of databases. The
following are major conceptual categories of databases that may be found in
many organizations.
i. Operational Data Base: Store detailed data needed to support the
business processes and operations of a company. They are also called
subject area databases, transaction databases, and production data
bases. Eg. Customer, human resource, inventory.
ii. Analytical Data Bases: Store data and information extracted from
operational and external databases

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 Summarized data and information most needed by managers

and other end uses.
 Also called management databases/information databases.
 Are also called multidimensional database since they frequently
use a multidimensional database structure.
iii. Data Warehouse: Store data from current and previous years that
has been extracted from the various operational databases of an
organization
iv. Distributed Database: Many organizations replicate and distribute
copies of or parts of data bases to network servers at a variety of sites.
Such a distributed database is termed as distributed database.
v. End-User Database: A variety of data files developed by the end user
at their workstations.
vi. An External Database: Access to a wealth of information from
external databases is available for a fee from commercial online
services and with or without charge from many sources on the World
Wide Web. Whenever you use search engine like Google or yahoo to
look up something on the internet, you are using an external
database- a very, very large one!
3.6. E-business

E-Business involves several key activities including improving business

processes, enhancing communications and providing the means to carry out
business transactions securely. E-business is part of a broader Internet
economy which encompasses all of the activities involved in using the Internet
for commerce. The Internet economy is made up of the following layers:
 Internet Infrastructure: Companies that provide the hard ware, soft
ware and other equipment for the Internet- examples: ISPs, networking
companies and manufacturers of PCs and servers.
 Internet Applications Infrastructure: Companies that provide soft ware
facilitating Internet transactions. Also, companies that provide web

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development design and consulting services. Example: producers of web

development soft ware, web-enabled data bases and search engines.
 Internet Intermediaries: Companies that link buyers and sellers, for
example by providing content or by creating market places where
business can be transacted. Examples: travel agents, content providers
and online brokerages.
 Internet Commerce: Companies that sell products and services to
consumers or other companies. Examples: online retailers, subscription
or free-based services and manufacturers selling directly to the public.
In general, the benefits of e-business include reduced costs, improved
efficiency and access to larger markets. By automating many of the
administrative tasks associated with ordering supplying and delivering goods
or services, the cost of a typical business transaction can be reduced
significantly. E-procurement is used to reduce administrative costs and
purchase goods at lower prices. It was mentioned earlier that adopting an e-
business approach could help to enhance three main areas of business.
Production processes, customer-focused processes and internal management
processes. In terms of customer-focused processes, for example, the efficiency
of customer services can be improved through the introduction of a help desk
on the company’s web site. As well as helping customers, such a facility can
also act to reduce costs by reducing pressure on other support services, such
as telephone help lines. Finally, the adoption of an e- business approach can
help companies to reach a larger global market. This is often one of the benefits
of restructuring the relationship between manufacturer, retailers and
customers.

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