Advantages & Disadvantages to Manual Data Entry

by Victoria Bailey - Updated July 23, 2018

Being hands-on with your business is a good thing, but that doesn't always apply to every phase of operations. Data entry is one key aspect of business where the move to automatic processes is almost always better. In very small businesses where the owner is the main operator, it can still make sense to do all the data entry manually, although upgrading to an automatic system can almost always make for smoother operations. And for companies with more than one or two employees, it almost always makes financial sense to move away from manual data entry as soon as possible.

Traditional Versus Modern Data Entry

Data entry for your business includes all the information you need to keep as a reference and record. The art of data entry is constantly improving, with a goal of making the results quicker and more accurate.

The very first types of manual data processing were entirely hand-done: journals and ledgers. Records were written down in on logs and stones and, eventually, in dedicated books designed for record keeping. After centuries of keeping track of everything by hand, business owners began to record information using machines. The first adding machines and typewriters sped things up, eventually making way for computers and calculators to do the same job more accurately and quickly.

Today's data entry is as hands-off as possible. POS systems scan code numbers from items to be sold or simple codes are entered into cash register-like machines, and the machines combine financial transactions with inventory maintenance in one job. The fewer the human hands on the figures, the less likely it is for human error to creep into calculations and the aim in today's processing methods is to work totally hands-free, in many cases.

Disadvantages of a Manual Information System

In almost all cases, automatic entry systems beat out manual systems, no matter how you look at them.

  •  Humans are prone to error, while computers are not. The more work you dedicate to machines, the more accurate your records will be.
  • Machines are faster than humans. This gives you the ability to perform many more business functions, from inventory review to creating labor charts, in a shorter amount of time.
  • One person can perform many functions at one time using automatic data entry instead of the manual method. This means money saved in labor costs across the board when you use machines for basic data entry and calculation.

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When Manual Data Entry Makes More Sense

Small new businesses with only an owner-operator find fewer benefits from automatic data entry than anyone else. When only one person is doing all the record-keeping, a swift transfer of information isn't as crucial. Also, more elaborate data processing methods can cost much more than many new business owners are able or willing to spend. These new business owners may find older methods, such as keeping records in a laptop and using a manual cash register, to be enough for their budding business. As businesses grow, however, most owners find benefits in the time-and-money-saving aspects of automatic data entry methods which far outweigh their drawbacks.

About the Author

Victoria Bailey has owned and operated businesses for 25 years, including an award-winning gourmet restaurant and a rare bookstore. She spent time as a corporate training manager in the third-largest restaurant chain in its niche, but her first love will always be the small and independent businesses. Bailey has written for USAToday, Coldwell Banker, and various restaurant magazines, and is the ghost writer for a nationally-known food safety training guru.

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