Introduction to Information Technology and Its Impact on Business: A Case Study of HSBC PLC

This report discusses the increasing use of information technology and its impacts on the business organization, with a case study of HSBC PLC. It highlights the different types of computer networks, ethical and social issues, and the impact of artificial intelligence on business enhancement. The report also discusses the importance of IT in enhancing operational activities and the impact of AI in business growth.

Introduction to information
technology

Abstract
The main purpose of this report is highlighted as the increasing use of information
technology and its impacts on the business organization. enhancement in the technological aspect
is being seen in recently which has led to increase in usage of these technological aspects. The
information technology is helping the business commencement in various ways which leads to
gain customer satisfaction by increasing the overall productivity for a business. These
technological process helps to reduce the cost of operations as well by cutting the extra expenses
that has to bear by the organization. This report has determined the networking options available
for a business organization that supports various activities in an organization. local area
networking, wider area networking, metropolitan area networking etc. are the components under
this heading which is being discussed thoroughly to understand the technological enhancement
from this particular aspect. Social and ethical issues of higher technological dependence is
discussed which has stated various threats and risk to privacy, security etc. these Sid effects of
increasing usage of technology is getting higher day by day. Further in the report increasing
acceptance of artificial intelligence is stating the areas in which AI helps a business to grow
immensely.

Table of Contents
Introduction to information technology...........................................................................................1
Abstract............................................................................................................................................2
INTRODUCTION...........................................................................................................................4
Literature review..............................................................................................................................4
Impact of IT in helping the business to enhance their operations...............................................4
Ethical and social issues which are increasingly becoming significant in virtual world.............5
Different types of computer networks and their impact on business...........................................5
The impact of Artificial Intelligence (AI) in enhancing the business.........................................6
Analysis and discussion...................................................................................................................7
Impact of information technology on HSBC PLC......................................................................7
Importance of ethical and social issues in HSBC which are significant in the virtual world......8
Types of networking technologies used in HSBC.......................................................................9
Use of AI in HSBC....................................................................................................................10
CONCLUSION..............................................................................................................................10
REFERENCES................................................................................................................................1

INTRODUCTION
The collection, processing, interpretation and storing the data is referred as information
technology. To support and enhance business activity it plays a vital role. These activities related
to data and its uses is done through usage of computer technology. It department in the
organization oversees the major part of technological aspects.
HSBC is the banking organization which was founded in year 1857 in British Hong Kong.
The organization provides their customers with distinct kinds of banking services such as
providing loans, lockers, financial services etc.
The following report will be highlighting the functional; areas of information technology in
context of HSBC banking group. Furthermore, the report will be mentioning, impact of IT in
enhancement of operational activities, importance of ethical social issues, different types of
computer networks and its impact on the firm and impact of AI in business enhancement.
Literature review
Impact of IT in helping the business to enhance their operations
According to Sathish and et.al., (2020) information technology supports the business
activity in many aspects and provides the best alternative to do a thing. Operating on a global
level is one of the benefit given by information technology. Business organization can reach
higher customer base with the help of it. Business commencement in different parts of the world
have become easier now because of information technology. Organizations can reach the
customers living in different parts of the world through emails, social media, messaging etc.
which is an offering of information technology in the firm. many organizations have their own
website which is maintained by IT department in the firm. these online portals are used by
customers and business to interact with one another.
Markova and et.al., (2019) has stated that IT helps in interacting activity that takes place
among the organization. employee can connect with their subordinates and superiors as well
through different channels that are being established by IT team.
According to the views of Sittig and Singh (2020), storage facility provided by IT has reduced
the burden of paperwork in the organization because data are now stored in virtual and physical
drive. Due to the reduction in this burden employees feel less tensed and their productivity isn’t
disrupted.

As per the views of Chatterjee and et.al., (2020) automation in business activities has
benefited many business organization as it has reduced the cost of operation and gave accurate
output which are not given by human resources. However, Li and Chan (2019) argued that this
has negative impact on the business as it is a factor that contributes in increasing the
unemployment rate.
Ethical and social issues which are increasingly becoming significant in virtual world
Torten and et.al., (2018) has discussed that increasing use of technology has resulted in
leakage of private information without the concern of the respective person. Every aspect of a
person’s life can be easily accessible to anyone which is a concerning impact of IT. Anyone from
any part of the world can access the data of person in minutes. This acts as a threat to
individuality and personal life of a personal. Many hackers use this information to blackmail the
person of the leakage of personal information in public. Data of the employees working in the
organization also possess the same threat as these data’s are stored in digital storage. Many
fraudulent practices are also attempted through the wrong use of technology. There are many
examples where a fraud transfers the money from one bank account to another without the
knowledge of the owner.
According to Lashkari and Boussard, (2018) the preference of customers of an
organization can be shifted because of the technological advancement. Higher use of technology
has resulted in mismatching of different cultures across the world which diverts the customer
preference frequently. Consumer preference can be easily penetrated by changing trend. Societal
values are being lost due to the invasion of foreign culture. Organizations face difficulties in
coping up with the changing preference of the customers and they are forced invest highly R&D
of the product in order to make it relevant with the customer preference.
From the views of Alfalah (2018), information technology has reduced the wants of human
resource and is leading towards higher number of unemployment. The work that was previously
done by humans is now being replaced with machines. This automation is beneficial for profit
maximization but it has this side effect as well which is of high concern.

Different types of computer networks and their impact on business
According to Mohammad and Surya (2018) LAN is the computer network that is most
commonly used in business organization and in homes. Lan stands for local area network. This
type of network enables the interconnectivity among devices in a restricted geographical region.
This network can have connected numerous devices at a time as it has no limits to devices. Lan
in office connects various devices through cable connection and those devices are then enabled
for internet usage. This helps the business to perform their day to day activities firmly. Many
powerful and enhanced LANs may include firewalls or load balancers which maintains the
network balance in order to eliminate any interruption.
Wan stands for wide area network which enables the business to connect the devices
located in multiple region to a single network. Lloyd (2020) discussed that WAN connects the
organizational units in one network irrespective of the distance between them. The collective
network of LAN can be considered as WAN. WAN requires more hardware components than
LAN. There are many types of option available for business organization to set up wan in their
business. Organizations can opt for leased lines, synchronous optical network (SONET), frame
relay and internet protocol suite.
WLAN is a type of wireless LAN service which enables the devices without connecting it
to a cable connection. WLAN reduces the dependence of cable connections and provides a
wireless and firm connection to the devices which makes them truly mobile. Khatwani and
Srivastava, (2018) stated that WLANs uses the high radioactive waves to provide internet
connections to the devices in an organization by using more than one access point. The users can
access the connection while moving around as well because the problem of wired connection is
being solved by this. Using a WLAN network one has to follow certain precautions as the
network is wireless and can be accessed by anyone in the area which poses a major risk to the
privacy.
According to Ratwani and et.al., (2019) SAN which stands for storage area network that
gives specialized block level network which provides access to the storage. San provides a pool
of storage to the users in the restricted area to multiple servers. San provides security to the data
and plays an important role in backing up the data of the business and business commencement
in continuity. Jimenez-Jimenez and et.al., (2018) stated that MAN stand for metropolitan area

network which can be availed for vast and specific areas such as large establishments and college
campus etc.
The impact of Artificial Intelligence (AI) in enhancing the business
According to Samimi (2020). business organization are getting higher benefits after the
implementation of artificial intelligence in their premises which has increased the productivity of
the organization. The implementation of right AI technology can help the business top grow and
flourish rapidly by providing automation in various aspects of business activities which makes it
more perfect and enhanced. AI helps to save time and money of the organization by optimising
the routine activities and process. The artificial intelligence system eliminates the errors that are
being made by humans and make the work more perfect. The AI can predict the future
preference of the customers by monitoring and evaluating the records and other factors which
influences the customer mind-set and demands. it can also determine the opportunities available
for the organization to grow the business and make respective changes to grab that opportunity.
AI also recommends various strategies for solving a problem after analysis every major and
minor factor thoroughly which cannot be done by humans.
Analysis and discussion
Impact of information technology on HSBC PLC.
Technological enhancement has supported the business activities of HSBC by providing
the customer or user friendly system which provides various services to the customers. E-
banking services provided by the IT has proved as one of the most beneficial aspect of
technology through which the bank provides various services to its customers. The customer can
access the information about the accounts from the comfort of their home through the e-banking
websites or application of the bank. They can check the balance of their account through this
facility and can view the statements of the transactions done during the any period. This user
friendly service enabled by IT has increased the customer satisfaction rate for the organization.
the mobile banking facility can be availed by the customers to request chequebooks or other
services without actually visiting the branch of the bank. Fund transfer can be done via these
online portals to any bank account by providing the essential credential. Through this service the
customers can transfer funds 24*7. This online portal of the bank can also be used by the

customer to avail various loans at any time if the eligibility is being marked on their account.
Enhanced information technology also enables the option for customer to purchase product and
services online by paying digital (Hawkridge, 2022). These days the online payments are majorly
opted by the customer as the exchange of money can be a reason for spread of disease. It
department also ensures the safety of the customer’s privacy by eliminating the factors which can
lead to any fraudulent activity. The ATM services also comes under the information technology
of the organization through which customers can withdraw or deposit cash balances to from their
account. These transactions are monitored by the IT team and any queries or issues related to the
above mentioned services are being solved by the IT department in HSBC. Further on, enhanced
technology in the organization has reduced the cost of service delivery as it has provided
automation in various aspect of business activities. This increases the customer satisfaction as the
quality of services provided has increased and the cost bear by them has reduced.
Importance of ethical and social issues in HSBC which are significant in the virtual world
Information technology has various drawbacks as well which pertains risk to the social and
ethical aspects. There can be seen various activities which are being occurred due to the heavy
dependence on technology (Benckendorff, Xiang and Sheldon, 2019). There are numerous
ethical and social issues in the virtual world, some of which are being discussed below in the
context of HSBC:
 Privacy issues- the increase use of technology is increasing the threat to privacy as
various technological equipment or sources can be modified by anyone to invade the
privacy of others. The information of users can get in the wrong hands and it can be used
to accomplish their wrong intensions. Various sources like webcams can be hacked and
used to spy on people from any part of the world. In the banking sector the information of
customers may get leaked if someone hacks the servers of the bank. The financial
information of the customers can get ibn the wrong hands which can be used to do
fraudulent activities.
 Security- security issues have also increased due to the increasing reliability on the
technology as anyone can hack the systems of an individual or of an organization. the
threats of different malware and viruses has increased as it is highly used by the hackers
these days to hack into the computers (Berente and et.al., 2021). More usage of internet

and other technologies increases the potential risks of these sources which can corrupt the
devices and the hacker can control these devices according to their benefits. The banking
sector is heavily affected by this as they deal in monetary transactions which are major
target for any hacker.
 Copyright issues- different ideas and content can have accessed through internet and can
be shared easily which is not originally made by the user. This rises the copyright
infringement issues which depicts that the original creator doesn’t gets any credit or
money for the work. The hard work of a person gets copied by other due to the higher
reach of technology. The banking sector also faces these issues as the competitors may
copy the idea of the organization and can give a competition to the firm by using their
technique.
Types of networking technologies used in HSBC
There are majorly 3 types of networking technologies used by HSBC that supports their day
to day activities by providing the needed resources to serve the customers (Zhang and Lu, 2021).
These 3 networks are LAN, WAN and MAN which are used according to the needs.
Functionality of these 3 networks are being discussed below in regards to the HSBC banking.
 Local Area Networking (LAN)- local area networking is used to connect the devices at
every individual branch of the organization as it connects the devices to a network in a
shorter geographical location. This network gives can be accessed by the device up to the
1 km of geographical distance. All the terminal of LAN is connected to a main server of
the building which is controlled by the main computer. All the devices in a branch of
HSBC is connected to a cable which provide internet to the system and it is controlled by
the IT team of the organization. the organization also uses specially designed software of
LAN that are made according to the banking needs such as Ethernet or token ring.
 Wide Area Networking (WAN)- wide area networking is one of the most used networks
in many business and households as well. HSBC uses this networking in some of its
branches to connect all the devices in the organization. wide area networking has higher
potential to cover a larger area than the LAN. This used for the branches which are bigger
in size or which has higher number of computer systems. This is like a type of internet
span which is mostly used as router in many areas across the globe. Cables or satellite
links can be used to create a wide area network.

 Metropolitan Area Networking (MAN)- metropolitan area networking is a largely built
networking system for a bigger area such as a city or a campus (Chen, Chen and Lin,
2020). MAN is used in the headquarters of HSBC as it is widely spread and covers a
large geographical area. The company uses this to connect all the device to a single link
in the headquarters so that the information can be shared easily from one device to
another. For implementation of this type of networking organization needs to first install
upgraded and enhanced devices which is essentially needed to install this large network.
Use of AI in HSBC
HSBC banking uses the artificial intelligence in the data an analysis which helps them to
collect and interpret the data accurately. These data analytics help to formulate effective
strategies for the organization. Many strategies are being recommended by the artificial
intelligence which is being formulated after analysing various factors that can or that are
effecting the performance of the organization in the respective segment. The AI powered
investing system in HSBC recommends the customers to invest their money smartly to gain more
interest and various other benefits like saving tax. The investment bankers are facing issues these
days as the fluctuation in the market can be seen, here artificial intelligence provide an evaluated
plan for investing which can be used by the bankers to recommend it to the customers. These
plans are formulated by AI after analysing previous records of the market performance and
considering the future happening which can fluctuate the markets (Samimi, 2020). The AI also
includes various environmental factors of the region in the process of examining the market. This
gives an increased edge to HSBC over its competitors as the artificial intelligence predetermines
various factors and supports the organization's sustainability. The artificial intelligence used in
HSBC is called Aipex which performs the above activities for the organization which helps in
gaining higher profits and higher customer satisfaction rate.
CONCLUSION
The above report has concluded various aspects of information technology and its effects on
business organization. literature review has shown the thoughts of different author on different
topic such as AI, types of networks etc. further in the report a thorough analysis of various topics
has been done in regards to HSBC holding PLC. In this the impact of information technology on
the operations of the organization has been mentioned reflecting the support of the technology in

gaining more and more profits by serving the customers with effective resources. Moreover, 3
ethical and social issues that are being faced by the organization due to the information
technology has been discussed thoroughly. Different types of computer networks have been
highlighted in the report such as LAN, WAN etc. and their uses and benefits to HSBC as well.
The report has enlightened the concept and usage of AI which is currently new in the market and
many people are not aware of it.

REFERENCES
Books and Journals
Alfalah, S.F., 2018. Perceptions toward adopting virtual reality as a teaching aid in information
technology. Education and Information Technologies. 23(6). pp.2633-2653.
Benckendorff, P.J., Xiang, Z. and Sheldon, P.J., 2019. Tourism information technology. Cabi.
Berente, N., Gu, B., Recker, J. and Santhanam, R., 2021. Managing artificial intelligence. MIS
quarterly. 45(3). pp.1433-1450.
Chatterjee, S. and et.al., 2020. Information Technology and organizational innovation:
Harmonious information technology affordance and courage-based actualization. The
Journal of Strategic Information Systems. 29(1). p.101596.
Chen, L., Chen, P. and Lin, Z., 2020. Artificial intelligence in education: A review. Ieee
Access. 8. pp.75264-75278.
Hawkridge, D., 2022. New information technology in education. Taylor & Francis.
Jimenez-Jimenez, D., Martínez-Costa, M. and Rodriguez, C.S., 2018. The mediating role of
supply chain collaboration on the relationship between information technology and
innovation. Journal of Knowledge Management.forward. Jama. 321(8). pp.743-744.
Khatwani, G. and Srivastava, P.R., 2018. Impact of information technology on information
search channel selection for consumers. Journal of Organizational and End User
Computing (JOEUC). 30(3). pp.63-80.
Lashkari, D., Bauer, A. and Boussard, J., 2018. Information technology and returns to
scale. Available at SSRN 3458604.
Li, T.C. and Chan, Y.E., 2019. Dynamic information technology capability: Concept definition
and framework development. The Journal of Strategic Information Systems. 28(4).
p.101575.
Lloyd, I., 2020. Information technology law. Oxford University Press.
Markova, O. and et.al., 2019. Implementation of cloud service models in training of future
information technology specialists.
Mohammad, S.M. and Surya, L., 2018. Security Automation in Information
Technology. INTERNATIONAL JOURNAL OF CREATIVE RESEARCH
THOUGHTS (IJCRT)–Volume, 6.
Ratwani, R.M., Reider, J. and Singh, H., 2019. A decade of health information technology
usability challenges and the path
Samimi, A., 2020. Risk management in information technology. Progress in Chemical and
Biochemical Research. 3(2). pp.130-134.
Sathish, R. and et.al., 2020, December. A report on the impact of information technology and
social media on Covid–19. In 2020 3rd International Conference on Intelligent
Sustainable Systems (ICISS) (pp. 224-230). IEEE.
Sittig, D.F. and Singh, H., 2020. COVID-19 and the need for a national health information
technology infrastructure. Jama. 323(23). pp.2373-2374.
Torten, R., Reaiche, C. and Boyle, S., 2018. The impact of security awarness on information
technology professionals’ behavior. Computers & Security. 79. pp.68-79.
Zhang, C. and Lu, Y., 2021. Study on artificial intelligence: The state of the art and future
prospects. Journal of Industrial Information Integration. 23. p.100224.

2