Impact of Information Technology on Business: CBA

This report highlights the impact and importance of information technology in Commonwealth Bank of Australia (CBA). It discusses the benefits, risks, and major features of IT in CBA, along with suitable recommendations.

Running head: IT FOR BUSINESS
Impact of Information Technology on Business: CBA
Name of the Student
Name of the University
Author’s Note:

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Executive Summary
The most significant objective of the report is knowing about impact and importance of
information technology in Commonwealth Bank of Australia (CBA). Information technology
system is generally used by several companies to perform numerous tasks. It also includes
certain software, hardware and applications to execute every business related procedures or
operations. The computers and software are also utilized to maintain a proper balance within
business strategies and attainments. This report has highlighted several aspects such as
benefits, risks and major features of IT in CBA. Moreover, suitable recommendation is also
provided here.

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Table of Contents
1. Introduction............................................................................................................................3
2. Discussion..............................................................................................................................3
2.1 Need of IT in Commonwealth Bank of Australia............................................................3
2.2 Importance of IT for Survival of Business.......................................................................3
2.3 Need to apply Information Technology within CBA.......................................................4
2.4 Procedure of CBA to use Information Technology.........................................................5
2.5 Advantages of Information Technology in the Australian Banking Sector.....................6
2.6 Types of Risks within Information Technology for CBA...............................................6
2.7 Procedure to maintain and monitor Information Technology in CBA............................7
3. Conclusion and Suitable Recommendation...........................................................................7
References..................................................................................................................................9
Appendix..................................................................................................................................11

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1. Introduction
Some of the major and the most significant impacts of information technology in a
business include transaction processing, information flowing, data management, decision
support, executive support and few others (Dutta, Geiger and Lanvin 2015). The growth of IT
has thus brought few significant innovations and creativity. This report will be demonstrating
a brief description of the overall impact and effect of information technology over CBA.
Several relevant details like need of IT, advantages or risks of this technology for CBA would
be described here.
2. Discussion
2.1 Need of IT in Commonwealth Bank of Australia
Commonwealth Bank of Australia (CBA) is a popular bank that is providing several
services and products to their customers. Due to its flexible structure, CBA gets high
opportunity to enhance their position in the banking sector (Marchewka 2014). Information
technology is responsible to increase production by reducing time after automation of tasks.
Moreover, communication is also improvised by this technology like emails, phone call or
audio and video conferences. Efficiency is improved by including interconnectivity of
internal and external structures (Holtshouse 2013). Data storage is even improved so that
CBA is able to manage their confidential data effectively and no data breach is faced.
2.2 Importance of IT for Survival of Business
IT plays an important role for survival of business. Such distinctive technology can be
referred to proper usage of systems so that business information is properly stored, retrieved
and sent (Bloom et al. 2014). Furthermore, it also maintains a major stability between
demand and supply of business services to ensure that every client is satisfied with their
services or products (Tarafdar, Gupta and Turel 2013). As a banking sector has to consider

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secured and safer online transaction, networks or other technologies must be absolutely free
from vulnerability and risk (Nguyen, Newby and Macaulay 2015).
A quick run of credit check is needed for them to make open credit easy and privacy
and security of data is even ensured with such technology. A constant need of services for
customers can be easily fulfilled with the successful involvement of IT. Cost effectiveness is
also maintained for productivity hike (Tafti, Mithas and Krishnan 2013). Customer support is
the next feature that is possible with this technology in CBA so that business survival is
possible and competitive advantages are obtained effectively.
2.3 Need to apply Information Technology within CBA
Australian bank of CBA needs to apply information technology within their
respective business to ensure high privacy and security of their confidential data. In the
month of May in 2018, respective banking officers of this particular bank had confirmed that
more than twenty million account details and data were being lost, although they mentioned
customers’ accounts’ security was not compromised (ABC.net.au. 2018). The respective
statements, which consisted of various such details of the customers for more than sixteen
years, were stored in magnetic tapes, which were damaged to withdraw these data. It was
done by Fuji Xerox and they ordered proper investigation to eventually figure out complete
procedure to store these statements for these magnetic tapes. Although, the respective
information was being shared with clients, brand name and reputation was highly affected
after this privacy breach in the bank (ABC.net.au. 2018).
As they confronted such issues related to data security breach, a proper involvement
of IT has the core potential to reduce these issues and problems to higher level for
maintenance of data security (Roztocki and Weistroffer 2015). The respective bank defended
their organizational decisions of not informing clients regarding such fraud activities. They

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will comprise of the core capability to improvise the data reporting or analysis with IT.
Moreover, as communication is highly improved, several security or privacy breaches can be
removed. A major planning and cost effectiveness is needed to effectively design and ensure
successful application of information technology (Fortunati, Pertierra and Vincent 2013).
They even need to design and install equipment to complete application of IT. Training is
also vital for employees and staff so that they are able to use this technology for betterment of
the business.
2.4 Procedure of CBA to use Information Technology
Commonwealth Bank of Australia will be using IT after proper utilization of few
important and significant methodologies and hence making the business operations and
procedures in an efficient manner (Melián-González and Bulchand-Gidumal 2016). A proper
transfer of this information is only possible to make the most effective decisions, thus making
sure that this information flow is perfect and even determination of business growth. Each
and every business owner eventually needs effective collaboration and communication with
their respective customers within time (Taipaleenmäki and Ikäheimo 2013). Moreover,
communication with business partners and investors is also needed to maintain a balance
between business strategies in a better manner.
Intranet network and Share Point is used to maintain high efficiency and information
related to business exchange can be easily and promptly shared with their staff after having
intranet electronic mails to complete communication (Tafti, Mithas and Krishnan 2013).
Bank manager can draft any message for sending it to the staff via several significant intranet
networks. Commonwealth Bank of Australia also enables these staff with similar network to
share confidential data in the business. This type of confidential information thus is being
protected and helping to simplify the entire flow of information (Tarafdar, Gupta and Turel

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2013). Utilization of technology is also enhanced after using emails in the bank of CBA to
enhance efficiency in a better manner.
2.5 Advantages of Information Technology in the Australian Banking Sector
The main advantages of information technology for Australian banking sector to
remove their privacy and security problems are:
a) Communication Streamlining: The first benefit of IT in CBA to ensure data
security is communication streamlining. A proper communication is needed for company
success within the connected as well as dispersed business scenario, selection of employees,
leveraging or retaining of staff (Marchewka 2014). Moreover, it is extremely important to
streamline both external and internal communication so that all issues are removed in an
effective manner.
b) Cost Effectiveness: Another advantage of IT in CBA is its cost effectiveness. It
does not incur huge costs related to maintenance and implementation of IT and hence all
types of managerial or operational processes are properly streamlined for gaining data value
or quality (See Appendix). It is even effective for improvement of flexibility as well as
revenue.
c) Storage of Valuable Data: The next benefit of IT in Commonwealth Bank of
Australia to ensure data security is to store as well as safe guard the confidential or valuable
data (Dutta, Geiger and Lanvin 2015). The proper preservation and storage of CBA’s
information technology is required to ensure financial data are safe and secured. Security
breaches could be easily avoided in this process.
2.6 Types of Risks within Information Technology for CBA
Some of the major as well as the most important types of risk for IT within CBA are:

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a) Security Risks: The various risks related to information security can eventually turn
out for being strategic risks such as the significant potential towards higher damages for
brand reputation (Nguyen, Newby and Macaulay 2015). Such significant kind of data security
is extremely helpful for proper requirement that the respective business execute while
completing security risk assessment. CBA must eliminate these issues effectively.
b) Privacy Risks: Another kind of risk, which is extremely common for CBA
regarding IT would be risks related to privacy. The consequences such as personal data
security and subsequent harm for privacy (Roztocki and Weistroffer 2015). Such issues can
bring major problem for the organizational systems.
c) Confidentiality Risks: As soon as data loses its integrity and confidentiality, CBA
may suffer from data access restriction and all others getting major access of this data. Hence,
it is needed for CBA to undertake few important actions in respect to data confidentiality.
2.7 Procedure to maintain and monitor Information Technology in CBA
Information technology can be maintained as well as monitored by CBA after
following some of the most important steps, which are:
a) Sequential Implementation: Steps are followed in this type of implementation and
hence there is a sequential approach (Fortunati, Pertierra and Vincent 2013).
b) Subsequent Analyses of all Issues or Modification: Every issue or modification is
being identified and analysed for further assistance.
c) Deployment of the Identified Modifications: All identified modifications are being
deployed in this particular step.
d) Proper Review and Acceptance of Maintenance: Reviewing should be done
properly and IT should be maintained periodically (Taipaleenmäki and Ikäheimo 2013).

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3. Conclusion and Suitable Recommendation
Thus, conclusion could be drawn down that there are some important impacts or
effects of information technology over businesses. The respective working conditions of
various individuals are eventually altered for these distinctive impacts and IT is majorly
responsible to provide these businesses with a significant scope for data analysis and also
planning of all business strategies effectively. This above provided report has properly
demonstrated about analysis of the most important impacts of IT over CBA. Implementation
and maintenance of IT within business is majorly suggested for CBA so that they could easily
eradicate any kind of issue or complexity for security breach.

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References
ABC.net.au. 2018. [online]. Accessed from
https://www.abc.net.au/news/2018-05-02/commonwealth-bank-confirms-loss-financial-
records-20m-customers/9720928 [Accessed on 26 May 2019].
Bloom, N., Garicano, L., Sadun, R. and Van Reenen, J., 2014. The distinct effects of
information technology and communication technology on firm organization. Management
Science, 60(12), pp.2859-2885.
Dutta, S., Geiger, T. and Lanvin, B., 2015. The global information technology report 2015.
In World Economic Forum(Vol. 1, No. 1, pp. P80-85).
Fortunati, L., Pertierra, R. and Vincent, J. eds., 2013. Migration, diaspora and information
technology in global societies. Routledge.
Holtshouse, D.K., 2013. Information technology for knowledge management. Springer
Science & Business Media.
Marchewka, J.T., 2014. Information technology project management. John Wiley & Sons.
Melián-González, S. and Bulchand-Gidumal, J., 2016. A model that connects information
technology and hotel performance. Tourism Management, 53, pp.30-37.
Nguyen, T.H., Newby, M. and Macaulay, M.J., 2015. Information technology adoption in
small business: Confirmation of a proposed framework. Journal of Small Business
Management, 53(1), pp.207-227.
Roztocki, N. and Weistroffer, H.R., 2015. Information and communication technology in
transition economies: An assessment of research trends. Information Technology for
Development, 21(3), pp.330-364.

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Tafti, A., Mithas, S. and Krishnan, M.S., 2013. The effect of information technology–enabled
flexibility on formation and market value of alliances. Management Science, 59(1), pp.207-
225.
Taipaleenmäki, J. and Ikäheimo, S., 2013. On the convergence of management accounting
and financial accounting–the role of information technology in accounting
change. International Journal of Accounting Information Systems, 14(4), pp.321-348.
Tarafdar, M., Gupta, A. and Turel, O., 2013. The dark side of information technology
use. Information Systems Journal, 23(3), pp.269-275.

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Appendix
Advantages of Information Technology in Banking Sector