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5.1: Computer Software

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    Learning Objectives

    Upon successful completion of this chapter, you will be able to:

    Software and hardware cannot function without each other. Without software, hardware is useless. Without hardware, the software has no hardware to run on. This chapter discusses the types of software, their purpose, and how they support different hardware devices, individuals, groups, and organizations.

    \(\PageIndex{1}\) Introduction to Software

    The second component of an information system is software. Software is the means to take a user’s data and process it to perform its intended action. Software translates what users want to do into a set of instructions that tell the hardware what to do. A set of instructions is also called a computer program. For example, when a user presses the letter ‘A” key on the keyboard when using a word processing app, it is the word processing software that tells the hardware that the user pressed the key ‘A’ on the keyboard and fetches the image of the letter A to display on the screen as feedback to the user that the user’s data is received correctly.

    Software is created through the process of programming. We will cover the creation of software in this chapter. In essence, hardware is the machine, and software is the intelligence that tells the hardware what to do. Without software, the hardware would not be functional.

    \(\PageIndex{2}\) Types of software

    The software component can be broadly divided into two categories: system software and application software.

    The system software is a collection of computer programs that provide a software platform for other software programs. It also insulates the hardware's specifics from the applications and users as much as possible by managing the hardware and the networks. It consists of

    Application software is a computer program that delivers a specific activity for the users (i.e., create a document, draw a picture). It can be for either

    Figure \(\PageIndex{1}\): Overview of software types. Image by Ly-Huong Pham is licensed under CC BY-NC

    System Software

    Operating Systems

    The operating system provides several essential functions, including:

    1. Managing the hardware resources of the computer
    2. Providing the user-interface components
    3. Providing a platform for software developers to write applications.

    An operating system (OS) is a key component of the system software. Examples of popular operating systems are Google AndroidTM, Microsoft WindowsTM, and Apple iOSTM.

    An OS is a set of programs that coordinate hardware components and other programs and acts as an interface with application software and networks. Some examples include getting input from a keyboard device, displaying output to a screen, storing or retrieving data from a disk drive.

    Figure \(\PageIndex{2}\): perating System Role. Image by Ly-Huong T. Pham is licensed by CC BY NC

    The above picture shows the operating system at the center; it accepts input from various input devices such as a mouse, a keyboard, a digital pen, or a speech recognition, outputs to various output devices such as screen monitor or a printer; acts an intermediary between applications and apps, and access the internet via network devices such as a router or a web server.

    In 1984, Apple introduced the Macintosh computer, featuring an operating system with a graphical user interface, now known as macOS. Apple has different names for its OS running on different devices such as iOS, iPadOS, watchOS, and tvOS.

    In 1986, as a response to Apple, Microsoft introduced the Microsoft Windows Operating Systems, commonly known as Windows, as a new graphical user interface for their then command-based operating system, known as MS-DOS, which was developed for IBM’s Disk Operating System or IBM-DOS. By the 1990s, Windows dominated the desktop personal computers market as the top OS and overtaken Apple’s OS.

    clipboard_ebe2c30f5a185b248f93356e913a7ca4e.pngFigure \(\PageIndex{3}\): Tux, Linux’s Mascot. Image by Larry Ewing and The GIMP is licensed under Creative Commons CC0 1.0 Universal Public Domain Dedication

    A third personal-computer operating system family that is gaining in popularity is Linux. Linux is a version of the Unix operating system that runs on a personal computer. Unix is an operating system used primarily by scientists and engineers on larger minicomputers. These computers, however, are costly, and software developer Linus Torvalds wanted to find a way to make Unix run on less expensive personal computers: Linux was the result. Linux has many variations and now powers a large percentage of web servers in the world. It is also an example of open-source software, a topic we will cover later in this chapter.

    In 2007, Google introduced Android to support mobile devices such as smartphones and tablets specifically. It is based on the Linux kernel, and a consortium of developers developed other open-source software. Android quickly became the top OS for mobile devices and overtook Microsoft.

    Operating systems have continuously improved with more and more features to increase speed and performance to process more data at once and access more memory. Features such as multitasking, virtual memory, and voice input have become standard features of both operating systems.

    All computing devices run an operating system, as shown in the below table. The most popular operating systems are Microsoft’s Windows, Apple’s operating system, and different Linux versions for personal computers. Smartphones and tablets run operating systems as well, such as Apple’s iOS and Google’s Android.

    Computing devices and Operating system

    Operating Systems



    Microsoft Windows

    Windows 10

    Windows 10

    Apple OS

    Mac OS


    Various versions of Linux


    Android (Google)

    According to (2020), from August 2019 to August 2020, Windows still retains the desktop's dominant position with over 87% market share. Still, it is losing in the mobile market share, to Android with over 70% market share, followed by Apple’s iOS with over 28% market share.

    Sidebar: Why Is Microsoft Software So Dominant in the Business World?

    Almost all businesses used IBM mainframe computers back in the 1960s and 1970s. These same businesses shied away from personal computers until IBM released the PC in 1981. Initially, business decisions were low-risk decisions since IBM was dominant, a safe choice. Another reason might be that once a business selects an operating system as the standard solution, it will invest in additional software, hardware, and services built for this OS. The switching cost to another OS becomes a hurdle both financially and for the workforce to be retrained.


    Utility software includes software that is specific-purposed and focused on keeping the infrastructure healthy. Examples include antivirus software to scan and stop computer viruses and disk defragmentation software to optimize files' storage. Over time, some of the popular utilities were absorbed as features of an operating system.

    Application or App Software

    The second major category of software is application software. While system software focuses on running the computers, application software allows the end-user to accomplish some goals or purposes. Examples include word processing, photo editor, spreadsheet, or a browser. Applications software are grouped in many categories, including:

    • Killer app
    • Productivity
    • Enterprise
    • Mobile

    The “Killer” App

    Figure \(\PageIndex{4}\):VisiCalc. Image by Gortu is licensed under Public Domain

    When a new type of digital device is invented, there are generally a small group of technology enthusiasts who will purchase it just for the joy of figuring out how it works. A “killer” application runs only on one OS platform and becomes so essential that many people will buy a device on that OS platform just to run that application. For the personal computer, the killer application was the spreadsheet. In 1979, VisiCalc, the first personal-computer spreadsheet package, was introduced. It was an immediate hit and drove sales of the Apple II. It also solidified the value of the personal computer beyond the relatively small circle of technology geeks. When the IBM PC was released, another spreadsheet program, Lotus 1-2-3, was the killer app for business users. Today, Microsoft Excel dominates as the spreadsheet program, running on all the popular operating systems.

    Productivity Software

    Along with the spreadsheet, several other software applications have become standard tools for the workplace. These applications, called productivity software, allow office employees to complete their daily work. Many times, these applications come packaged together, such as in Microsoft’s Office suite. Here is a list of these applications and their basic functions:

    • Word processing: This class of software provides for the creation of written documents. Functions include the ability to type and edit text, format fonts and paragraphs, and add, move, and delete text throughout the document. Most modern word-processing programs also have the ability to add tables, images, voice, videos, and various layout and formatting features to the document. Word processors save their documents as electronic files in a variety of formats. The most popular word-processing package is Microsoft Word, which saves its files in the Docx format. This format can be read/written by many other word-processor packages or converted to other formats such as Adobe’s PDF.
    • Spreadsheet: This class of software provides a way to do numeric calculations and analysis. The working area is divided into rows and columns, where users can enter numbers, text, or formulas. The formulas make a spreadsheet powerful, allowing the user to develop complex calculations that can change based on the numbers entered. Most spreadsheets also include the ability to create charts based on the data entered. The most popular spreadsheet package is Microsoft Excel, which saves its files in the XLSX format. Just as with word processors, many other spreadsheet packages can read and write to this file format.
    • Presentation: This software class provides for the creation of slideshow presentations that can be shared, printed, or projected on a screen. Users can add text, images, audio, video, and other media elements to the slides. Microsoft’s PowerPoint remains the most popular software, saving its files in PPTX format.
    • Office Suite: Microsoft popularized the idea of the office-software productivity bundle with their release of Microsoft Office. Some office suites include other types of software. For example, Microsoft Office includes Outlook, its e-mail package, and OneNote, an information-gathering collaboration tool. The professional version of Office also includes Microsoft Access, a database package. (Databases are covered more in chapter 4.) This package continues to dominate the market, and most businesses expect employees to know how to use this software. However, many competitors to Microsoft Office exist and are compatible with Microsoft's file formats (see table below). Microsoft now has a cloud-based version called Microsoft Office 365. Similar to Google Drive, this suite allows users to edit and share documents online utilizing cloud-computing technology. 





    Spreadsheet Presentation Other
    Microsoft Office Word Excel PowerPoint

    Outlook (email), Access (database), OneNote (information gathering) and many other

    Apple iWork pages numbers keynote Integrates with iTunes, iCloud, and other Apple software
    OpenOffice Writer Calc Impress Base (database), Draw (drawing, Math (equations)
    Google Drive Document Spreadsheet Presentation Gmail,(email), Forms (online form data collection, Draw (drawing) and many others.

    Sidebar: “PowerPointed” to Death

    As presentation software, specifically Microsoft PowerPoint, has gained acceptance as the primary method to formally present information in a business setting, the art of giving an engaging presentation is becoming rare. Many presenters now just read the bullet points in the presentation and immediately bore those in attendance who can already read it for themselves.

    The real problem is not with PowerPoint as much as it is with the person creating and presenting. The book Presentation Zen by Garr Reynolds is highly recommended to anyone who wants to improve their presentation skills.

    New opportunities have been presented to make presentation software more effective. One such example is Prezi. Prezi is a presentation tool that uses a single canvas for the presentation, allowing presenters to place text, images, and other media on the canvas and then navigate between these objects as they present.

    Enterprise Software

    As the personal computer proliferated inside organizations, control over the information generated by the organization began splintering. For example, the customer service department creates a customer database to track calls and problem reports. The sales department also creates a database to keep track of customer information. Which one should be used as the master list of customers? As another example, someone in sales might create a spreadsheet to calculate sales revenue, while someone in finance creates a different one that meets their department's needs. However, the two spreadsheets will likely come up with different totals for revenue. Which one is correct? And who is managing all this information? This type of example presents challenges to management to make effective decisions.

    Enterprise Resource Planning

    In the 1990s, the need to bring the organization’s information back under centralized control became more apparent. The enterprise resource planning (ERP) system (sometimes just called enterprise software) was developed to bring together an entire organization in one software application. Key characteristics of an ERP include:

    • An integrated set of modules: Each module serves different functions in an organization, such as Marketing, Sales, Manufacturing.
    • A consistent user interface: An ERP is a software application that provides a common interface across all modules of the ERP and is used by an organization’s employees to access information
    • A common database: All users of the ERP edit and save their information from the data source. This means that there is only one customer database, there is only one calculation for revenue, etc.
    • Integrated business processes: All users must follow the same business rules and process throughout the entire organization”: ERP systems include functionality that covers all of the essential components of a business, such as how organizations track cash, invoices, purchases, payroll, product development, supply chain.
    Figure \(\PageIndex{6}\): ERP Modules. Image by Shing Hin Yeung is licensed under CC-BY-SA

    ERP systems were originally marketed to large corporations, given that they are costly. However, as more and more large companies began installing them, ERP vendors began targeting mid-sized and even smaller businesses. Some of the more well-known ERP systems include those from SAP, Oracle, and Microsoft.

    To effectively implement an ERP system in an organization, the organization must be ready to make a full commitment, including the cost to train employees as part of the implementation.

    All aspects of the organization are affected as old systems are replaced by the ERP system. In general, implementing an ERP system can take two to three years and several million dollars.

    So why implement an ERP system? If done properly, an ERP system can bring an organization a good return on its investment. By consolidating information systems across the enterprise and using the software to enforce best practices, most organizations see an overall improvement after implementing an ERP. Business processes as a form of competitive advantage will be covered in chapter 9.

    Customer Relationship Management

    A customer relationship management (CRM) system is a software application designed to manage customer interactions, including customer service, marketing, and sales. It collects all data about the customers. The objectives of a CRM are:

    • Personalize customer relationship to increase customer loyalty
    • Improve communication
    • Anticipate needs to retain existing or acquire new customers

    Some ERP software systems include CRM modules. An example of a well-known CRM package in Salesforce

    Figure \(\PageIndex{7}\): Components in the different types of CRM. Image by Bgrigorov is licensed under CC-BY-SA
    Supply Chain Management

    Many organizations must deal with the complex task of managing their supply chains. At its simplest, a supply chain is a linkage between an organization’s suppliers, its manufacturing facilities, and its products' distributors. Each link in the chain has a multiplying effect on the complexity of the process. For example, if there are two suppliers, one manufacturing facility, and two distributors, then there are 2 x 1 x 2 = 4 links to handle. However, if you add two more suppliers, another manufacturing facility, and two more distributors, then you have 4 x 2 x 4 = 32 links to manage.

    Figure \(\PageIndex{8}\): A supply and demand network. Image by Andreas Wieland is licensed under CC-BY-SA 3.0

    A supply chain management (SCM) system manages the interconnection between these links and the products' inventory in their various development stages. The Association provides a full definition of a supply chain management system for Operations Management: “The design, planning, execution, control, and monitoring of supply chain activities to create net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand, and measuring performance globally.” 2 Most ERP systems include a supply chain management module.

    Mobile Software

    A mobile application, commonly called a mobile app, is a software application programmed to run specifically on a mobile device such as smartphones and tablets.

    Smartphones and tablets are becoming a dominant form of computing, with many more smartphones being sold than personal computers. This means that organizations will have to get smart about developing software on mobile devices to stay relevant. With the rise of mobile devices' adoption, the number of apps is exploding in the millions (, 2020), and there is an app for just about anything a user is looking to do. Examples include apps as a flashlight, a step counter, a plant identifier, and games.

    \(\PageIndex{3}\) Cloud Computing

    Historically, for software to run on a computer, an individual copy of the software had to be installed on the computer, either from a disk or, more recently, after being downloaded from the Internet. The concept of “cloud” computing changes this model.

    “The cloud” refers to applications, services, and data stored in data centers, server farms, and storage servers and accessed by users via the Internet. In most cases, the users don’t know where their data is actually stored. Individuals and organizations use cloud computing.

    You probably already use cloud computing in some forms. For example, if you access your email via your web browser, you are using a form of cloud computing. If you use Google Drive’s applications, you are using cloud computing. Simultaneously, these are free versions of cloud computing, big business in providing applications and data storage over the web. Commercial and large applications can also exist on the cloud, such as the entire suite of CRM from Salesforce is offered via the cloud. Cloud computing is not limited to web applications: it can also be used for phone or video streaming services.

    Advantages of Cloud Computing

    • No software to install or upgrades to maintain.
    • Available from any computer that has access to the Internet.
    • Can scale to a large number of users easily.
    • New applications can be up and running very quickly.
    • Services can be leased for a limited time on an as-needed basis.
    • Your information is not lost if your hard disk crashes or your laptop is stolen.
    • You are not limited by the available memory or disk space on your computer.

    Disadvantages of Cloud Computing

    • You must have Internet access to use it. If you do not have access, you’re out of luck.
    • You are relying on a third party to provide these services.
    • You don’t know how your data is protected from theft or sold by your own cloud service provider.

    Cloud computing can greatly impact how organizations manage technology. For example, why is an IT department needed to purchase, configure, and manage personal computers and software when all that is really needed is an Internet connection?

    Using a Private Cloud

    Many organizations are understandably nervous about giving up control of their data and applications using cloud computing. But they also see the value in reducing the need for installing software and adding disk storage to local computers. A solution to this problem lies in the concept of a private cloud. While there are various private cloud models, the basic idea is for the cloud service provider to rent a specific portion of their server space exclusive to a specific organization. The organization has full control over that server space while still gaining some of the benefits of cloud computing


    One technology that is utilized extensively as part of cloud computing is “virtualization.” Virtualization is using software to create a virtual machine that simulates a computer with an operating system. For example, using virtualization, a single computer that runs Microsoft Windows can host a virtual machine that looks like a computer with a specific Linux-based OS. This ability maximizes the use of available resources on a single machine. Companies such as EMC provide virtualization software that allows cloud service providers to provision web servers to their clients quickly and efficiently. Organizations are also implementing virtualization to reduce the number of servers needed to provide the necessary services. For more detail on how virtualization works, see this informational page from VMWare.

    \(\PageIndex{5}\) Software Creation

    We just discussed different types of software and now can ask: How is software created? If the software is the set of instructions that tells the hardware what to do, how are these instructions written? If a computer reads everything as one and zero, do we have to learn how to write software that way? Thankfully, another software type is written, especially for software developers to write system software and applications - called programming languages. The people who can program are called computer programmers or software developers.

    Analogous to a human language, a programming language consists of keywords, comments, symbols, and grammatical rules to construct statements as valid instructions understandable by the computer to perform certain tasks. Using this language, a programmer writes a program (called the source code). Another software then processes the source code to convert the programming statements to a machine-readable form, the ones, and zeroes necessary to execute the CPU. This conversion process is often known as compiling, and the software is called the compiler. Most of the time, programming is done inside a programming environment; when you purchase a copy of Visual Studio from Microsoft; It provides the developers with an editor to write the source code, a compiler, and help for many of Microsoft’s programming languages. Examples of well-known programming languages today include Java, PHP, and C's various flavors (Visual C, C++, C#.)

    Shows the processes involved in going from source code to executable instructions as described in the text above
    Figure \(\PageIndex{9}\): Convert a computer program to an executable. Image by Ly-Huong T. Pham is licensed under CC-BY-NC

    Convert a computer program to an executable. Image by Ly-Huong T. Pham is licensed under CC-BY-NC

    Thousands of programming languages have been created since the first programming language in 1883 by a woman named Ada Lovelace. One of the earlier English-like languages called COBOL has been in use since the 1950s to the present time in services that we still use today, such as payroll, reservation systems. The C programming language was introduced in the 1970s and remained a top popular choice. Some new languages such as C#, Swift are gaining momentum as well. Programmers select the best-matched language with the problem to be solved for a particular OS platform. For example, languages such as HTML and JavaScript are used to develop web pages.

    It is hard to determine which language is the most popular since it varies. However, according to TIOBE Index, one of the companies that rank the popularity of the programming languages monthly, the top five in August 2020 are C, Java, Python, C++, and C# (2020). For more information on this methodology, please visit the TIOBE definition page. For those who wish to learn more about programming, Python is a good first language to learn because not only is it a modern language for web development, it is simple to learn and covers many fundamental concepts of programming that apply to other languages.

    One person can write some programs. However, most software programs are written by many developers. For example, it takes hundreds of software engineers to write Microsoft Windows or Excel. To ensure teams can deliver timely and quality software with the least amount of errors, also known as bugs, formal project management methodologies are used.

    Open-Source vs. Closed-Source Software

    When the personal computer was first released, computer enthusiasts immediately banded together to build applications and solve problems. These computer enthusiasts were happy to share any programs they built and solutions to problems they found; this collaboration enabled them to innovate more quickly and fix problems.

    As software began to become a business, however, this idea of sharing everything fell out of favor for some. When a software program takes hundreds of hours to develop, it is understandable that the programmers do not want to give it away. This led to a new business model of restrictive software licensing, which required payment for software to the owner, a model that is still dominant today. This model is sometimes referred to as closed source, as the source code remains private property and is not made available to others. Microsoft Windows, Excel, Apple iOS are examples of closed source software.

    There are many, however, who feel that software should not be restricted. Like those early hobbyists in the 1970s, they feel that innovation and progress can be made much more rapidly if we share what we learn. In the 1990s, with Internet access connecting more and more people, the open-source movement gained steam.

    Open-source software is software that has the source code available for anyone to copy and use. For non-programmers, it won’t be of much use unless the compiled format is also made available for users to use. However, for programmers, the open-source movement has led to developing some of the world's most-used software, including the Firefox browser, the Linux operating system, and the Apache webserver.

    Some people are concerned that open-source software can be vulnerable to security risks since the source code is available. Others counter that because the source code is freely available, many programmers have contributed to open-source software projects, making the code less buggy and adding features, and fixing bugs much faster than closed-source software.

    Many businesses are wary of open-source software precisely because the code is available for anyone to see. They feel that this increases the risk of an attack. Others counter that this openness decreases the risk because the code is exposed to thousands of programmers who can incorporate code changes to patch vulnerabilities quickly.

    In summary, some benefits of the open-source model are:

    • The software is available for free.
    • The software source code is available; it can be examined and reviewed before it is installed.
    • The large community of programmers who work on open-source projects leads to quick bug-fixing and feature additions.

    Some benefits of the closed-source model are:

    • Providing a financial incentive for software developers or companies
    • Technical support from the company that developed the software.

    Today there are thousands of open-source software applications available for download. An example of open-source productivity software is Open Office Suite. One good place to search for open-source software, where thousands of software applications are available for free download.

    Software Licenses

    The companies or developers own the software they create. The software is protected by law either through patents, copyright, or licenses. It is up to the software owners to grant their users the right to use the software through the terms of the licenses.

    For closed-source vendors, the terms vary depending on the price the users are willing to pay. Examples include single user, single installation, multi-users, multi-installations, per network, or machine.

    They have specific permission levels for open-source vendors to grant using the source code and set the modified version conditions. Examples include free to distribute, remix, adapt for non-commercial use but with the condition that the newly revised source code must also be licensed under identical terms. While open-source vendors don’t make money by charging for their software, they generate revenues through donations or selling technical support or related services. For example, Wikipedia is a widely popular and online free-content encyclopedia used by millions of users. Yet, it relies mainly on donations to sustain its staff and infrastructure.

    There Are Now 8.9 Million Mobile Apps, And China Is 40% Of Mobile App Spending (2020, Feb 28). Retrieved September 4, 2020, from


    The software gives the instructions that tell the hardware what to do. There are two basic categories of software: operating systems and applications. Operating systems provide access to the computer hardware and make system resources available. Application software is designed to meet a specific goal. Productivity software is a subset of application software that provides basic business functionality to a personal computer: word processing, spreadsheets, and presentations. An ERP system is a software application with a centralized database that is implemented across the entire organization. Cloud computing is a software delivery method that runs on any computer with a web browser and access to the Internet. Software is developed through a process called programming, in which a programmer uses a programming language to put together the logic needed to create the program. The software can be an open-source or a closed-source model, and users or developers are granted different licensing terms.