The Impact Of IT On Business Survival: A Case Study Of Commonwealth Bank Of Australia Essay.

You are to research a real life business example of your choice and the impact of IT on that business.

1) Does your chosen business need IT?

2) Why IT is important for business survival?

3) What is required to apply IT into your chosen business?

4) How does your chosen business use IT?

5) What benefits and advantages does IT bring to your chosen business?

6) What type of risks does IT bring to your chosen business?

7) How can your chosen business maintain and monitor IT?

Why IT is important for business survival?

The “Commonwealth Bank of Australia” is the multinational bank in Australia providing various services like institutional banking, business, insurance, retail and investment. IT has been responsible for technological advances in business.

The impact of IT over “Banking and Finance” is required to be assessed. A research is required to be generated on the real life scenario of Commonwealth Bank of Australia that is taken as an instance.

The report discusses the requirements of IT on this business. It explores various survival strategies of business and usage of IT. The profits and advantages that IT brings to the industry is analyzed.  Finally it helps in understanding various risks and controlling of them.

The banking and finance sectors like the Commonwealth Bank of Australia require facing the challenges regarding business and technology. They have been required to respond and adapt the changes of industry along with new demands of the authorities and customers. They required helping the clients to stay on the frontline of the Internet world (Miller and Skinner  2015).

The “Commonwealth Bank of Australia” have needed to offer the providers with innovate IT solutions. The clients needed to go for services from the business consulting to the services of IT infrastructure. The solutions are needed to be delivered to the customers as service. The business needed to take up the complete responsibility for the functionality of the solution and ensure that every regulatory requirement has been satisfied.

The banks needed to design the proactive and personalized solutions of digital banking for the customers. They have also needed to develop the solutions of mobile banking enhancing customer experiences (Davenport 2013).

The business is also required to promote themselves in social media sites to attract customers. Lastly, the latest technology of cloud based solutions for the data in their database has been required to be stored effectively. Due to all these blessings from the technology and information world, the IT has been essential for banking and finance sectors.

The data innovation in managing the banking industry is changed significantly. IT has made e-business conceivable in the industry. The internal systems that enable the bank to do e-business are the “analytics e-business solutions” and “sales force automation”.

The IT supports the banking nationwide with the mobile sales force and give more employees to access through online” Customer Relationship Management System”. IT helps in upgrading and centralizing customer around numerous communication channels. It has been providing advanced reporting for analyzing information from every customer transactions, compensation management, and planning incentives around various selling channels (Frame and White 2014). It delivers exact management of the sales leads, revenue pipeline, proper real rimes proposals and quotes of customers. IT helps to identify the up-sell and cross sell scopes. The sales channels could be further extended through the Web.

What is required to apply IT into your chosen business?

Utilizing an online system for recruitment makes the way toward applying for a job easily. The IT system saves time in screening and collecting applications, sending notification and arranging interviews and examinations. The IT secures lots of expenses by eliminating the usage of paper maligning and receiving application online.

As per as the customers are concerned the banks provides ATMs, machines for cash deposits, mobile banking, online banking and many more. These have been all the fruits of information and technology advances making the banking experience very easier (Fraser, Bhaumik and Wright 2015).

Cost: The costs to enable and carry IT in Commonwealth Bank of Australia is required to be implemented effectively. It carries the expense of important systems and programs providing the capabilities to meet the requirements as discussed above. The organization must save costs through IT operating architectures and models. They should spend much time on IT to enhance the growth of IT and resulting complexity of the business operations.

Planning: The extra expenditure on IT and going through strategic changes has been just a part of the equation. The best practices needed by the bank is to generate more value by structurally better operating model of IT. This must be scalable, flexible and efficient. This must be giving them the head start on digital banking.

Designing: With high budgets the banks need to hire the best experts and experts in design thinking to architect their dashboards. Many banking believe that most of the customers have been using mobile apps or low graded devices. This is the reason that the various banks have been devoid of mobile banking (Laeven, Levine and Michalopoulos 2015). The “Commonwealth Bank of Australia” provides the feature with a limited functionality but awful design. The advice of experts regarding future banking must be based on holistic, aesthetic, simplicity, mobile first principle, self-service, transparency and personalization.

Equipment: The electronic banking being the extension of traditional banking has been utilizing internet like a channel of electric delivery for the services and products of banking. It uses the electronic equipments and includes the AFT, EFT, Debit/Credit Card, ATM, Net Banking and telephone banking (Marin? 2013). The banks like “Commonwealth Bank of Australia” have also modernized the services with the computer and electronic facilities.  

Installation: Regarding installation, the instance of ATMs could be taken. The customers have started demanding more ATM services, elaborative in manner. The initial machine has been just a cash dispenser. However, the banks of today like the “Commonwealth Bank of Australia” could install sophisticated ATMs. This has been scanning checks, giving out cash o coins, letting customers apply for the loans and permitting face-to-face discussion with the service representatives through video.

How does your chosen business use IT?

Training: The identification of the training requirements at different professional levels has been a challenge. The functions must be diverse as persons qualified technically has been maintaining and operating the network. This results in large requirement of designing special courses and prepare domain for specific course materials. The courses are needed to be of short duration and modular in structure (Grubel 2014). This would help the officials learn and update themselves quickly. The courses with the course materials are required to be reviews. This must be upgraded periodically in line with the challenges of critical technology emerging. There could be continuous handholding by virtual training, e-learning and much more delivering direct hand on experiences that is required to be implemented in the system.

Internal approach: The IT in banking has been enhancing productivity through various measures. It is done by proper computing of time-consuming and cumbersome jobs like interest calculations and balancing within deadlines. There has been automatic printing of covering schedules, pass books or sheets, deposit receipts and enabling them to focus on the needs of customers (Hanafizadeh, Keating and Khedmatgozar  2014). There has been assisting in the transaction verifications, retrieval facility and sitting at their own terminal. There has been avoidance of duplicate entries because of the presence of single-point data entry.

There has been availability of huge range of inquiry facilities, assisting the bank on business follow-up and development. There have been quiche replies to the customer queries without the reference to the ledger-keeper as the terminals provided to the managers. There has been further carrying out of prompt and automatic standing instructions on generation of reports within due date. There have been generation of different MIS reports and periodical returns within due dates (Berger, Molyneux and Wilson 2014). Lastly there has been quick up-to-date data transfer that has been leading to take quick decisions through connecting digital branches and the controlling offices.

External approach: The banks like “Commonwealth Bank of Australia” have deployed particular solutions like self-inquiry facility. This is the facility to log in to particular self-inquiry terminals at the branch in inquiring and viewing the accounts of transactions. There have been remote banking facilities and “anytime banking-anywhere banking” features. They have also helped in tele-banking, electronic banking. Moreover, as the data has been centralized and updates have been available at every place at the same time, the single-window service is possible, resulting in effective decrease in the waiting time.

What benefits and advantages does IT bring to your chosen business?

It has been the safest way to circulate money. As the money gets stolen, it could be replaced. It helps in obtaining personal loans or business loans as needed. The banking and finance sectors possess specific reasons to embrace the outsourcing that has been of high potential value in the time of an employee. The hour spent on internal process has been the time lost to the activities of revenue generations (Hanson et al. 2015).

Another major factor has been the cost cutting. The outsourcing converts fixed costs into the variable costs. It would release capital for the investment allowing the business to avoid huge expenses while the initial stages of evolution. The investors have been viewing the outsourcing in a positive manner. This is because it has been putting more capital into the activities of revenue production. Moreover, the IT has allowed the banks to choose and seek suitable provider who could complement the business process and structure. This helps in flexibility in managing the business.

The most important risks in the financial services existing in this scenario are the Strategic risk of Information Technology, IT continuity and resiliency risks and cyber security with the incident response risk. There have been further risks regarding privacy from third-party and technology vendors (Chae, Koh and Prybutok 2014). The confidentiality risks include proper data management. The risks regarding execution of IT programs and technology operations could be included in the list. Lastly, there lies the risk of ineffective management of risks.

In order to oversee risks regarding IT, the boards of “Commonwealth Bank of Australia” should understand the risks technologies. They should query the management to drive the real meaning of risks through understanding the risk landscapes and setting clear expectations and directions. Various risks management systems consider different areas of IT separately (Safari and Liu 2014). In order to focus on the in-depth of the IT coverage various frameworks could be furnished like ISF, CRAMM and ISO 2700x. They help in converting the systems covering the risk management of IT without any attempt to integrate them with the risk management of business.

Conclusion: 

The basic structure of the banks like “Commonwealth Bank of Australia” has been rising in conflicts with the change in products, service and delivery needs of the clients. Most of the banks in future would be creating value networks. The banks have needed to develop an IT distributive system that would comprehensive and enable clients to communicate with them at various points. They should also determine the method of deployment of IT infrastructure to be done by themselves or by outside service providers. However, IT alone could not solve the problems or generate benefits. IT requires to get integrated in the banking and finance systems linking with people. It also requires well communicated and clearly defined business strategy.

References:

Berger, A.N., Molyneux, P. and Wilson, J.O. eds., 2014. The Oxford handbook of banking. OUP Oxford.

Binuyo, A.O. and Aregbeshola, O., 2014. The impact of information and communication technology (ICT) on commercial bank performance: evidence from South Africa. Problems and perspectives in Management, 12(3), pp.59-68.

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Chae, H.C., Koh, C.E. and Prybutok, V.R., 2014. Information Technology Capability and Firm Performance: Contradictory Findings and Their Possible Causes. Mis Quarterly, 38(1), pp.305-326.

Davenport, T.H., 2013. Process innovation: reengineering work through information technology. Harvard Business Press.

Frame, W.S. and White, L.J., 2014. Technological change, financial innovation, and diffusion in banking.

Fraser, S., Bhaumik, S.K. and Wright, M., 2015. What do we know about entrepreneurial finance and its relationship with growth?. International Small Business Journal, 33(1), pp.70-88.

Grubel, H.G., 2014. A theory of multinational banking. PSL Quarterly Review, 30(123).

Hanafizadeh, P., Keating, B.W. and Khedmatgozar, H.R., 2014. A systematic review of Internet banking adoption. Telematics and informatics, 31(3), pp.492-510.

Hanson, S.G., Shleifer, A., Stein, J.C. and Vishny, R.W., 2015. Banks as patient fixed-income investors. Journal of Financial Economics, 117(3), pp.449-469.

Laeven, L., Levine, R. and Michalopoulos, S., 2015. Financial innovation and endogenous growth. Journal of Financial Intermediation, 24(1), pp.1-24.

Marin?, M., 2013. Banks and information technology: marketability vs. relationships. Electronic Commerce Research, 13(1), pp.71-101.

Miller, G.S. and Skinner, D.J., 2015. The evolving disclosure landscape: How changes in technology, the media, and capital markets are affecting disclosure. Journal of Accounting Research, 53(2), pp.221-239.

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