Body Language: Meaning, Types, Significance and Importance | Kinesics

 Q. What do you mean by Body Language ? Discuss the types and significance of body language. 

OR

Q. What do you mean by Kinesics or Body Language ? Discuss the types and importance of body language. 

Ans. Meaning of Body Language: Body language is a prominent and an important medium of non-verbal communication. It communicates very rapidly even the most suitable ideas. Body language expresses internal feelings very clearly. Effect of motions, ideas, thoughts, attitudes and feelings is reflected in human behaviour. 

Non-verbal means like body movement, gesture, posture, eye contact, pitch variation, etc. communicate ideas and messages in an effective manner. 

Body language is also called Kinesics. In it a person transmits message by the movement of different parts of his body, such as, face, eyes, shoulders, head, hands, etc. For instance, nodding head up and down conveys agreement; shaking head from side to side means disagreement; movement of hand is a mark of greeting or good bye, affection or annoyance can be expressed by eyes. 

Thus, kinesics is a study of body movements and gestures. 

Types of Body Language: Body language may be classified into the following types :

(1) Postures: Posture refers to way of sitting and standing. Physical structure of everybody is nature-bestowed. It can be made more attractive and agile by regular exercise and yoga, etc. 

Since posture is less well controlled than voice, it may serve as a clue to emotional states which otherwise might be successfully disguised. While to some extent posture like facial, legs communicate non-verbal messages. Posture and movement can convey self-confidence, status or interest. A confident executive may have a relaxed posture and yet may stand more erect than a timid subordinate.  An interesting listener may lean forward toward the speaker, one who is bored may lean away, slump or glance at the desk. 

(2) Gestures: Gestures are physical movements of our arms, legs, hands, torsos and head nods. Through the movement of each of these body parts, we can assert and reinforce our verbal messages. And we can observe how others punctuate their verbal efforts with gestures. 

Gestures have a role of their own in communication. In oral communication proper co-ordination of speech and gestures render communication effective manifold. Ordinarily, however, gestures express emotion or describe objects of special shape and appear to be closely coordinated with speech.

According to Murphy, hand and arm gestures are used for several reasons : (i) To Emphasize; (ii) To Point; (iii) To Reject; (iv) To Describe.

In fact, gestures change with person and place. With change of time or person, meanings of gestures also undergo a change.

(3) Facial Expressions: The facial expression or the expression of the face is the most important feature of body language. We look at the face to determine much of the meaning behind body language and non-verbal communication. Argyle observes that facial expressions are used in close combination with speech to emphasize or modify meanings and to provide feedback. Vine has observed that a listener signals his responses to what is being said by small movements of the eyebrows and mouth, expressing surprise, pleasure, puzzlement, disagreement and other reactions. Similarly, a speaker signals through appropriate expressions the context which his speech is to be interpreted – whether it is serious, funny, friendly or cold.

Darwin believed that there is a small number of universal emotions and associated with these emotions are universal facial expressions. Subsequent research generally identified six basic emotions (happiness, surprise, sadness, fear, disgust and anger), from which more complex or blended emotions are derived. Basic emotions are associated with quite distinctive patterns of facial muscle activity: for instance, surprise is associated with raised eyebrows, dropped jaw, horizontal wrinkles across the forehead, raised upper eyelid, and lowered lower eyelid show posed versions of the six basic emotions. 

Some facial expressions are associated with basic emotions appearing to be fairly universal.

(4) Eye Contact: Eye contact, an older term for non-verbal channel refers more precisely to mutual gaze.

The amount and pattern of gazing is a rich source of information about people’s feelings, their relative status, their credibility and honesty and their competence and attentiveness.

An old cliche says, “Look a person in the eye when you talk to him.” This simply means that when you are communicating with others, try looking them in the pupil and let the pupils tell you their real feelings. Under certain conditions, the pupils may dilate or contract as per the attitude and mood of the individual. For example, when one is excited the pupils can dilate up to four-times their normal size. Whereas during ire, frustration, depression or any other negative mood, they are contract. 

In fact, the way you establish eye contact with someone speaks about your attitude or the situation in which you are communicating with him. 

Some studies divide gaze behaviour into three categories:

(i) Formal Gaze: This is appropriate for boardrooms, business meetings, job interviews, project presentation, public speaking etc. Here, one should look at the imaginary triangle on the other person’s forehead above the area between the eyes. With this kind of gaze, one will be able to control the interaction to an extent. 

(ii) Informal Gaze: This is suitable for interacting with friends and associates. In this case, let your gaze casually drop between the other person’s eye zone forming an imaginary triangle downward on thr area between his eye and chin. This will add a congenial to the interface. 

(iii) Lateral Gaze: This type of gaze is used to convey either your interest or hostility towards the other person or situation. Interest towards the other gender, especially in courtship, can be expressed by smiling and slightly raising the eye-brows. 

North Americans whites see eye contact as a sign of honesty. But in many cultures, dropped eyes are a sign of appropriate respect to a superior.

Puerto Rican children are taught not to meet the eyes of adults.  The Japanese are taught to look at the neck. In Korea, prolonged eye contact is considered rude. The lower-ranking person is expected to look down first. In Muslim countries, women and men are not supposed to have eye contact.

Eye movement and eye contact with complete facial expression convey their messages more effectively.

(5) Bodily Contact: Bodily contact includes hitting, pushing, holding, striking, shaking hands, embracing, touching and a variety of other activities. Their use varies with the type of relation and situation. 

Touch is perhaps the earliest form of communication we learn. Long before we learn language, we give and receive information by touch. There are many different types of touch of different parts of the body. The meaning of attach parries as a function of the type of touch, the context within which the touch occurs. From analysis of fifteen hundred bodily contacts between people, Jones and Yarbrough identified five discrete categories of touch :

(i) Positive affect: to communicate appreciation, affection, reassurance, nurturance or sexual interest. 

(ii) Playful: to communicate humour and playfulness.

(iii) Control: to draw attention or induce compliance.

(iv) Ritualistic: to satisfy ritualised requirements (for example, greetings and departures).

(v) Task-related: to accomplish tasks (for example, a nurse taking one’s pulse or a violin teacher positioning one’s hand).

To these can be added, negative affect (gently pushing an annoying hand away) and aggressive touches (slaps, kicks, shoves, punches). 

(6) Appearance: Appearance covers non-verbal impressions that affect receiver’s attitudes. Appearance may be of two types :

(a) Personal Appearance: Clothing, hairstyles, neatness, jewellery, cosmetics, posture and stature are part of personal appearance. They conveys impressions regarding occupation, age, nationality, social and economic level, job status. 

Terms such as smart, casual or business casual are symbols for appearance. It is important that you know what they mean in your particular environment. 

(b) Appearance of Surroundings: Aspects of surroundings include room size, location, furnishings, machines, architecture, wall decorations, floor (carpeted or bare), lighting, windows, view and other related features wherever people communicate orally. Surroundings will vary according to status and according to country and culture.

(7) Silence: Silences are a natural and fundamental aspect of communication, often ignored. Silences are not absence of communication. They are an integral part of interpersonal communication. In fact, effective communication between people depends heavily on silences because people take turns at talking and at being silent when listening. Silence forms a fascinating part of communication. 

There are different types of silences, each with a meaning of its own and different implications and consequences for communication. For example : (i) Silence when we are worrying about a problem on hand, is different from (ii) Silence, which occurs when we are listening attendively to a speaker or watching a movie. 

Silences cannot be lumped (mixed) all together. Each must be interpreted on its own. Reaction to each of these silences is different because each means something different.

Our silence stems (comes/arises) from different causes which is reflected in our actions, expressions and movements.

Silence may be appropriate or inappropriate depending on the situation. Responding silently to a situation which requires talking and not being silent when we should, is inappropriate. 

Importance/Significance of Body Language: Lesikar is of the opinion that the importance of body language is revealed by the fact that much of what we say to others without using words is sent through the physical movement of our body. The following facts reveal the importance of body language:

(1) Reveals the Working of Emotions: When we wave our arms and fingers, wrinkle our foreheads, stand erect, smile, gaze at another, wear a coat and tie and so on, we convey certain meanings and others convey meaning to us in return. In particular, the face and eyes, gestures, posture, and physical appearance reflect the inner workings of emotions in our bodies. 

The face and eyes are the most important features of body language. We look to the face and eyes to determine much of the meaning behind body language and non verbal communication. For example, happiness, surprise, fear, anger and sadness usually require definite facial expressions and eye patterns. Thus, you should be aware of these two aspects of body language as you speak and listen to others. 

(2) Reveals the status: The relative status of interactants can be very evident from body language.  Higher-status individuals adopt a relaxed, open posture with arms and legs asymmetrically positioned and a backward lean (bent for support) to the body. Lower status individuals adopt a more rigid, closed and upright posture with arms close to the body and feet together. 

(3) Replaces Verbal Communication: When verbal communication breaks down, non-verbal communication may serves as a substitute.

(4) Sustain (to support, to keep alive, to encourage) Verbal Conversation: Once a conversation starts, body language helps sustain it by providing a steady (fixed) stream (direction) of feedback information concerning the other person’s responses. Body language from posture and gestures may also help sustain communication by emphasizing or illustrating points made in the verbal message. Nods of the head, graunts and shifts of gaze or tone of voice are crucial. 

(5) Reveals a Person’s Attitudes and Traits: Body language provides cues to a person’s attitudes and traits and to his identity as a person. It shows intra-cultural differences.

(6) Reveals the Truth: Body language reveals the truth. In the words of Nancy Austin, “When people do not know whether to believe what they are hearing or what they are seeing, they go with the body language — it tells the truth. You can play fast and loose with words, but it is much more difficult to do with gestures”.

(7) Practical Application: Body language is a very important tool of practical application in real life. According to Marilyn Mapie, “When you can consciously ‘read’ what others are saying unconsciously, you can deal with the issue – at work and at home – before they become problems.

(8) Proxemics or Space Language, Time Language: The proxemics is the study of how we use space, time and surroundings in communication. Proxemics involves space and time and how they communicate in speaking and listening.

Accounting: Meaning, Difference Between Book-Keeping and Accounting, and Objectives

Q. Define Accounting. How is it different from Book-Keeping? Explain the objectives of Accounting. 

Ans. Definition of accounting: According to American Institute of Certified Public Accountants (A.I.C.P.A.), “Accounting is the art of recording, classifying and summarizing in a significant manner and in terms of money, transactions and events which are, in part atleast, of a financial character, and interpreting the results thereof.”

Distinction between Book-Keeping and Accounting: 

Book-Keeping differs from Accounting in the following respects :

Sr. No.	Basis	Book-Keeping	Accounting
1.	Scope	Book-Keeping includes : (a) Identifying the transactions of financial nature; (b) Measuring the identified transactions in terms of money; (c) Recording the measured transactions, and (d) Classifying them into ledger.	Accounting in addition to book-keeping includes: (i) Summarizing the classified transactions; (ii) Analysing and interpreting the summarised results; and (iii) Communicating the results to parties interested in them.
2.	Stage	Book-Keeping is primary stage.	It is the secondary stage. Accounting starts where Book-Keeping ends.
3.	Objective	The main objective is of Book-Keeping is to maintain systematic records of transactions of financial nature.	Its main objective is to ascertain the net results and financial position of the business and to communicate them to interested parties.
4.	Nature of Job	The Book-keeping function is routine and clarical in nature.	The Accounting function is analytical in nature.
5.	Who Performs	The Book-Keeping function is performed by junior staff.	The Accounting function is performed by senior staff.
6.	Knowledge Level	It can be performed by person having limited level of knowledge.	It is performed by persons having higher level of knowledge than that of Book-keeper.
7.	Analytical Skill	The Book-keeper is not required to possess analytical skill.	The Accountant is required to possess analytical skill.
8.	Personal Judgement	In all enterprises transactions are recorded according to the principles of accountancy and personal judgement of the book-keeper is not required.	Methods of analysing, interpretation and reporting may differ in various enterprises. Hence, personal judgment of the accountant is essential.
9.	Supervision and Checking	Book-keeper cannot supervise and check the work of an accountant.	Accountant supervises and checks the work of a book-keeper.
10.	Information for Managerial Decisions	It does not provide any information for taking manerial decisions.	It provides information for taking managerial decisions.

Objectives of Accounting: The following are the main objectives of accounting :—

(1) Maintenence of systematic record of business transactions: The main objective of accounting is to maintain complete record of business transactions according to specified rules. Complete record of business transactions helps to avoid the possibility of ommission and fraud. For this purpose, all the business transactions are first of all recorded in Journal and Subsidiary books and then posted into ledger.

(2) Calculation of profit or loss: The second main objective of accounting is to ascertain the net profit earned or loss suffered on account of business transactions during a particular period. For this purpose Trading and Profit & Loss Account of the business is prepared at the end of each accounting period. All the items relating to purchases, sales, expenses and revenues (incomes) of the business are recorded in Trading and Profit &Loss Account. If the amount of revenue exceeds the expenditure incurred in earning that revenue, there is said to be profit. In case the expenditure exceeds the revenue, there is said to be loss. In addition, a businessman is able to get the following information by preparing a trading and profit & loss account:—

I. How much goods have been purchased during a particular period?

II. How much goods have been sold during a particular period.

III. How much goods have remained unsold and what is its value.

IV. How much amount has been spent on various heads of expenditure and how much amount has been earned by various heads of revenues. 

By attaining these informations a businessman can keep effective control on expenditure.

(3) Depiction of financial position of the business: For a businessman, merely ascertaining profit or loss of the business is not sufficient. The businessman must also know the financial health of the business. For this purpose, after preparing the Profit & Loss Account, a statement called ‘Balance Sheet’ is prepared which shows the assets and their values on the one hand and the liabilities and capital on the other hand. A Balance Sheet is actually a screen picture of the financial position of the business. At one glance, one would know the following by looking at the Balance Sheet :—

I. How much the business has to recover from debtors.

II. How much the business has to pay to creditors.

III. How much the business has in the form of (a) Cash in hand (b) Cash at Bank (c) Closing Stock, and (d) Fixed Assets.

(4) To portray the liquidity position: Another objective of accounting is to provide information about how an enterprise obtains and spends cash. For this purpose it prepares a cash flow statement depicting inflows and outflows of cash from operating, investing and financing activities. 

(5) To file Tax returns: One of the main objectives of accounting is to provide bases for filing tax returns relating to income tax, sales tax, value added tax, service tax, excise duty, etc.

(6) Communicating accounting information to various users: Another main objective of accounting is to communicate the accounting information to various interested parties like owners, investors, creditors, banks, employees and government authorities etc. The information helps them in taking sound and judicious decisions about the business entity.

Cost Accounting: Branch of Financial Accounting and Key to Valuable Information

 Q. “Cost accounting is the branch of Financial Accounting and it has been evolved to do away the limitations of financial accounting and to meet the needs of the management.” Comment.

OR

“The ordinary trading account is a locked storehouse of most valuable information to which a cost system is the key.” Do you agree? Substantiate.

VK

[Ans. The cost Accounting need arouse because of the limitations of financial accounting. As the results of the financial accounts are provided for the whole organisation and that too after the end of the year (which means these results are nothing but the post-mortem of the dead body) and hence these are of very little use to the management in planning and control and decision-making under various conditions. These limitations can be explained as follows:

1. Financial Accounts show only the net results of the business: As we know that financial accounts (i.e. trading account, profit and loss account and baĺance sheet) are prepared at the end of the year and for the whole of the organisation and not the cost or profits of each product or cost centre or cost unit or process or job or batch etc, and hence financial accounts fail to provide day to day information regarding cost of product.

2. Financial Accounts do not make any difference between direct cost and indirect cost: As financial accounts fail to create any difference in direct and indirect expenses for the product, controllable or uncontrollable expenses or variable and non‐variable expenses so financial accounts fail to help in taking effective decision making under crucial circumstances like depression, low demand, competition or make or buy decisions etc.

3. Financial Accounts fail to reveal the weak points of the business: If an organisation is producing different products then it is difficult to analyse which product is profitable or not-profitable and why so? Whether a product, process or centre is running into losses or profit, this information is not revealed. 

4. Financial Accounts fail to help in fixation of selling price of a product: As the total cost incurred during the period dividend by total output is the only system of calculating cost of production per unit and that too at the end of the period thus it fails to help in fixation of selling price of the product specifically on the different stages of production of goods and under the various circumstances of business.

5. Financial Accounts fail to provide control on material, labour and other expenses: In financial accounts, the control on cash movement gets very heavy attention in comparison to the material, labour, and other expenses. While the losses of these elements result into increase in cost of production and thus more selling price, resulting into the failure to face competition and thus ultimately paading away from market of the business.

6. Financial Accounts lack to reveal operating efficiency or inefficiency: There is no system which can explain whether the organisation is running efficiently or not. The only judgement is through increase in profits or decrease in profits. But the increase in profits if takes place through controlling the cost of production or through controlling waste of material or wastage of time or by higher productivity of the labour that is what will be having positive effect on the working of the organisation and in that lies the real efficiency and improvement of the organisation. This can be revealed by cost accounting.

7. Financial accounts fail to provide comparison for cost of products: As financial accounts record the transition after the transiction takes place so cost of production cannot be compared with the expected cost or cost of different periods, different jobs, different departments or operations. Without comparison it is difficult to analyse whether the cost are rising or falling and the reasons responsible for this change. Efficiency of a department or of an organisation can be judged by comparison only.

8. Financial Accounts lack in performance appraisal of the organisation: There is no system in financial accounting which can help to judge the various alternatives to improve the performance and working of the different departments, products, markets or methods of production. Thus, the profitability of various alternatives may not be analysed and the organisation may fail to maximise the profits in the available circumstances.

9. Financial Accounts fail to analyse the losses: If during the period there are losses in the undertaking then there is no provision or system to analyse why the losses have taken place and if any reason is assigned then in future it may not be possible to control the same. But cost accounts can help to establish the reason of losses by applying management by exception and responsibility accounting. 

10. Financial Accounts fail to keep proper records regarding use of machinery: There is no system in financial accounts which the records of the working hours of the machinery and other factors of production, record regarding idle time and reasons of idle time are kept. Scrap, wastage of material or records, defective and spoiled outputs are not recorded and hence results into wastage of working machine hours.

11. Financial Accounts fail to reveal profits product wise: Which department, cost centre, process is more profitable or less profitable or unprofitable, also this information is not revealed by financial accounts and hence if any of the products or processes is running into loss then it is reducing the overall profits of the whole organisation.

12. Financial Accounts fail in helping decision making:  The management has to take the various critical and strategic decisions in the interest of the organization like, make or buy, product mix, change in method of production, change in selling price, change in quality of product and change in material used etc. These all\nAre critical decisions which affect the whole of the organisation’s working and functioning. There must be some system in the accounts on which the management may depend while taking these critical and strategic decisions.]

Thus, we can say that cost accounting has overcome the limitations of financial accounting with the help of techniques like budgeting, marginal costing, standard costing, etc. 

OR

(SBP) L.W. Hawkins has rightly said, “The ordinary trading account is a locked storehouse of most valuable information to which a cost system is the key.” It means that a number of valuable information exist in trading account but they can be understood and analysed in a useful manner only with the help of cost system. 

Limitations of Financial Accounting OR Need for Cost Accounting: Financial Accounting is considered as the oldest system of accounting. This accounting system is regarded as historical in nature and provides post-mortem of past records. It suffers with various limitations which led to the development of cost accounting. The following are the limitations or deficiencies of financial accounting:

1. Lack of details of materials: Financial accounting failed to provide information about the value and quantity of direct and indirect material used in various jobs, activities or departments the cost and quality of normal and abnormal loss of material, scrap or spoilage of material during the manufacturing process, the share of material cost in the total cost of product or job, etc

2. Lack of Analysis of Labour Cost: Financial accounting only discloses the total amount of wages paid during the year. It fails to provide information as regards to wages paid for specific jobs, activities, department or product. Further, it does not provide information as regard to direct and indirect wages, wages for idle time, over-time, cost for inefficiencies of labour, methods of remunerating labour. etc.

Financial Accounting is silent as regard to number of workers engaged in production and other activities, number of workers engaged on various jobs or departments, number of hours devoted by workers, rate of wages. It also does not provide information whether the increase in number of workers or increase in wage rate has led to corresponding increase in production or output or not.

3. Lack of Classification and Analysis of Overheads: One of the limitation of financial accounting is that it does not provide information as regards to expenses on various overheads department-wise, product-wise or activity-wise. Financial accounting even fails to provide information as regard to expenses on overheads nature-wise viz., variable overheads, semi-varible overheads and fixed overheads for the department, product, job or activity. These overheads are not expressed in financial statements into controllable or non-controllable overheads, basis of apportionment of overheads etc.

4. Lack of Details of Costs and its Elements: Financial accounting lacks in providing information as regards to ascertainment of cost of various products, jobs, activities or services rendered. It fails to provide direct and indirect cost incurred on various activities, cost at various stages of production. It also does not take into account and provide various costs, which are helpful in taking managerial decisions such as opportunity cost or imputed cost, etc.

5. Lack of Complete Information of Costs: Information available from financial statements are considered to be inadequate and meaningless for the purpose of cost control because financial accounting does not record the cost data as required for the purpose of application of various cost control techniques viz., budgetary control or for standard costing. These techniques require information of actual or budgeted cost as regard to each element of cost viz., material, labour and overheads but in quantitative terms and monetary terms for the purpose of comparison of results. Financial accounting system has no provision of laying down standards in regards to material, labour or overheads in order to make actual costs comparable.

6. Difficulty in Fixation of Selling Price: As financial accounting does not ascertain cost of products or activities, hence fixation of selling price of product or activities becomes rather difficult especially in changing market conditions. Various managerial decisions require information as regard to cost and selling price viz., determination of BEP sales, quoting of tender prices, to accept or reject the special offer, fixation of minimum price, fixation of selling price while launching a new product. These decision-making becomes difficult from information provided by financial accounting. 

7. Lack of Details of Working of Machines: Financial accounting fails to provide the number of hours worked by a machine and the number of hours it remained idle. No record is kept of the hours worked by different machines in the manufacture of a product or the completion of a job. No proper check is applied to reduce wastage of time and materials occurring at the machines.

8. No Details of Production: In financial accounting, no proper system is adopted to control under-production or over-production. Daily/Montly/Weekly production charts are not prepared and compared with previous periods and budgets. 

9. Difficulty in analysing Profitable and Non-Profitable Activities: The financial accounting discloses the overall profit of the concern as a whole. It does not help in analysing the profitable and non-profitable activities, contribution made to profit by each department separately. Suppose, the profit for a year as disclosed by financial books is ₹70,000 but if we analyse this profit department wise, the following position is revealed.

Dept. A   +75000 (profit)

Dept. B    - 50000 (loss)

Dept. C    +25000 (profit)

Total       + 70000 (profit)

Now on analysis, the management can either plan to close down Dept. B or to improve its working. This analysis can be done with the help of cost accounting. 

10. Limitation in Analysing Efficiency: The efficiency of a department and persons involved can be judged by quantity produced, the quality of products, costs incurred and time saved. Due to lack of proper data, financial accounting does not help in rewarding the efficiency and punishing the inefficiency. The causes of inefficiency cannot be analysed and efficiency improved upon. 

11. Lack of Data required for Decision-making: The management has to take crucial decisions at times on several matters, such as, product selling, make or buy, plant installation, closure of departments, product mix, etc. These decisions can be taken on the basis of relevant and adequate data which financial accounting fails to provide in the systematic manner. 

It is worth mentioning to quote G.R. Glover and R.C. Williams that “The existence of an accurate system of financial accounts will reveal the general position of a business, but it will not furnish the special detailed information that is derived from an efficient costing system information that is necessary for the internal control and management of a business.”

Hawkins statement can be explained the help of following example.

A company manufactures and sells three products ‘A’, ‘B’ and ‘C’. The Trading and Profit and Loss Account of the company is as follows:

Trading and Profit and Loss Account shows the net profit of the company but the details of various products are locked in this account, which have been opened with the help of the key of the cost account. 

Thus, we can say that cost system is an important key for analysis of profit, reduction of cost and increase in efficiency. It has been rightly stated that “Cost accounts are key to economy in manufacture and are indispensable for the intelligent and economical management of a factory.” The key of cost accounting does help in providing the following information:

1. Separate cost of materials for each product or process.

2. Details of normal and abnormal wastage of material.

3. Separate cost of labour for each product or process.

4. Separate calculation of gross profit for each product and service. 

5. Separate calculation of net profit for each product or service. 

6. Total cost and per unit cost of each product.

7. Detailed analysis of various elements of cost for the calculation of tender price.

8. Information of relative efficiency of plants, machinery, labour and various departments.

Information Technology in Retailing: Types Used by Retailers

 Q. What is information technology? Describe in detail the types of information technology being used by retailers now-a-days. 

Ans. Meaning of Information technology: The Information technology means the use of tools such as computers and telecommunications for sending, receiving and retrieving information. 

In the words of Information Technology Association of America, “Information technology is the study, design, development, implementation, support or management of computer based information systems, particularly software application and computer hardware.”

Types of Information Technology used by retailers are as follows:

1. Computers: Today almost every retailer uses the computers. They use computers to make accounting entries, to store the data about the inventory, data about the customers, etc. Also all the records of the sales, the mode of payments by the customers, etc. are stored in the computers. 

2. Biometric System: Biometric system makes use of sophisticated technology which identifies special human characteristics such as finger prints, retina and iris, face recognition, size and shape of hand, etc. All these characteristics are specific to each individual and hence are very authentic proof of somebody’s identity. By using biometrics, the retailers have been able to reduce the credit card losses, etc. Hence it has increased customer’s confidence. Also, retailers are using biometric systems in order to record the entry and extra time of their employees. This has proved to be extremely useful as it has improved the attendance of the workforce and has also reduced so many frauds committed in the name of others.

3. Wireless Technology: By using wireless technology, the retailers are able to monitor the in-store operations very effectively. The retailers can have the knowledge about any area of the retail store. An effective medium by which the retailer can communicate with anybody around the store is walkie talkie. 

4. Integrated Electronic Security Management Solution: These types of systems are being increasingly used by the retailers these days. It includes the use of camera surveilliance popularly known as Close Circuit Television Cameras (CCTV cameras) in and around the retail store to notice the activities taking place. It also involves creating a video recording of both inside and outside of the store. There is an immediate accessibility to these recorded videos in order to use them at any time in future such as for evidences, investigations, etc. Also included in this is the remote viewing of the retailer’s shop. By using this feature, the retailer can view his shop live from any corner around the world by using internet. Also , there is a system of alarms set. The alarm will automatically ring and an e-mail will be sent to the retailer on the happening of a pre-defined event. For example, if the retailer has fed in the system that on someone trying to open the lock of the retail outlet illegitimately, then the alarm should ring. If someone tries to open the outlet illegitimately, the alarm will ring an e-mail will be automatically sent to the retailer. This system has proved to be extremely useful for the retailer against any possible thefts or shoplifting, etc. 

5. Database Management, Data Warehousing and Data Mining: These systems are used to organize retrieve stored and manage the data about the customers. All this data is stored in the database. Managing this data is known as database management. Data warehousing and data mining are the elements of database management.

Data warehouse is just like a simple warehouse. Just as a simple warehouse is used to store the goods, data warehouse is used to store the data regarding the customers. When the sales clerk swipes the customers loyalty card, all the information regarding the customer, his age, sizes, preferences, previous purchases, mode of payments, etc. appear and this information can be used to find customer’s loyalty to analyze the demand. 

Data mining means extracting the data about the customers for specific uses. This data is generally used for customer relationship management purposes. The data can be used to identify specific market segments, analyzing the customer’s behaviour and therefore is helpful in defining specific sales promotion campaigns for the target markets.

6. Bar Code Technology: This is a very common technology that is used by the retailers. Every product is assigned a unique bar code. Typically a bar code is a symbol consisting of many bars with some specific distance between them. A bar code contains information about the country code, the company code, the product code, the check digit, etc. When the bill is made, these bar codes are read by the bar code scanners and the details of the product are automatically loaded in the computer. This is very effective technology that helps in saving time while billing. Also if any article goes missing in the barcode series, it becomes easy to know the product details as all the information is already loaded in the computer. Also, bar codes are useful in stock taking and therefore any inventory shrinkages can be known.

7. Radio Frequency Identification (RFID): RFID is a technology that is increasingly being used by the retailers these days. It is replacing the barcode technology. RFID includes retrieving and storing information from the tag attached to the products through frequency modulated radio waves transmission. RFID technology helps in tracking the goods anywhere in the world as long as the RFID reader is within the range. This is an extremely useful technology and if used properly can help in tracking even the stolen products. But sometimes this technology is viewed as a disadvantage because it may sometimes be viewed as interference in individual’s privacy and can be used to track the movements of the customer inside and outside the store. 

8. Electronic Article Surveilliance: The electronic article surveilliance is another form of technology that is being used by the retailers. Under this technology, all the articles are attached with specific tags. When customer buys the articles, these tags are removed properly by the sales clerks. But if the articles are stolen by somebody and the price to move out of the store with the same, the alarms rings at the exist of the store and therefore the retailer is alarmed about the shoplifting. Also, various articles of the inventory can be tracked by using this electronic article surveilliance. All these have helped the retailer being prevented from the threat of goods being shoplifted.