IT's Impact on Business: Success, Failure, Ethical Concerns, Networks

This report provides a comprehensive analysis of the role of Information Technology (IT) in the success and failure of a business, focusing on the case of the Milestone Hotel. It explores how IT streamlines communication, facilitates strategic thinking, safeguards valuable information, and reduces costs, while also addressing potential pitfalls such as security issues, increased regulations, and implementation costs. The report delves into ethical and social issues related to IT, including piracy, hacking, threats to security, defamation of business reputation, and privacy disruptions. Furthermore, it differentiates between various network technologies like LAN, MAN, and WAN, highlighting their applications for the Milestone Hotel. The report concludes by summarizing the advantages of IT investment, such as increased bookings and enhanced guest experience, while also acknowledging potential disadvantages like distractions and high maintenance costs. Overall, the report emphasizes the critical importance of responsible IT implementation for sustainable business growth and ethical operations, providing valuable insights for business development.

INDIVIDUAL
REPORT

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Role of IT in success and failure of a business.......................................................................1
2.Ethical and social issues which pertains to running business..................................................3
3. Different kinds of network technology and their differences.................................................4
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Information technology is referred to as a sub-category of information and
communication technology. Different products and services associated with IT are electronics,
software, telecom equipment, hardware, e-commerce and internet. This technology benefits
business personnel’s in collecting data and transforming it into useful information which assists
in appropriate decision making (Chao and Chandra, 2012). This report is based on Milestone
Hotel which is a UK based five-star hotel, headquartered in Kensington, London. This hotel is a
part of Red Carnation Hotels groups. This assignment includes role of IT in failure or success of
business. Along with this, ethical and social issues are mentioned which impact business. Also,
different kinds of network technologies and their differences are discussed.
MAIN BODY
1. Role of IT in success and failure of a business
Information technology plays a crucial role in business growth. It helps an organisation in
managing accounts, point of sales system, management information system etc. Digital
marketing is a tool which helps an organisation to gain competitive advantage over competitors.
IT can result in loss of revenue, if not used appropriately. In context of Milestone Hotel,
information technology has considerable impact on working and profitability of hotel. Role of
information technology in success and failure of a business is discussed below:
Role of IT in business success:
 Streamlines communication: To sustain a firm position in market, every organisation
requires effective communication process. IT assists an organisation in streamlining both
external and internal communication with the help of telecommunication, video
conferencing, voice call etc. Due to applications like WebEx and Skype, expenses of
Milestone Hotel in bringing clients on-site will reduces which results in enhanced
profitability (Fayolle and Gailly, 2015).
 Facilitates strategic thinking: Another advantage offered by IT is that it helps a
company in achieving competitive advantage against rival firms. It assesses and leverage
social networks which helps an organisation in assembling, interpreting and transferring
information in an efficient manner. This can help Milestone hotel in expanding their
customer base because of technological advancement.
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 Safeguards valuable information: IT helps in storing, preserving and maintaining
information in an organised manner. Data management is vital for all businesses that
needs to store information of clients for a longer time span. In case of Milestone hotel, IT
benefits in protecting content and data from unauthorised access due to which customers
feel more secured as their privacy is maintained. This will result in enhanced revenues of
Hotel.
 Cut costs and eliminate waste: Implementing IT can be an expensive procedure but it is
very cost effective as it streamlines managerial and operational process of a company.
Also, Online training programs will help workforce of Milestone hotel in improving their
working skills and capabilities (Filser, Kraus and Märk, 2013). This leads towards
optimum utilization of resources and reduction in wastage & expenses.
Role of IT in business failure:
Security issues: Safeguarding data and using it by ethical means is the foremost priority for
every organisation. IT assists managers in Milestone hotel to store important information
regarding customers and business. If sensitive data related with customers or hotel is hacked and
leaked, this will result in loss of revenue and reduced market reputation which results in business
failure.
Increased regulations: Businesses and industries associated with hospitality sector are heavily
regulated. This is because to perform their business operations, these industries gather private
and sensitive information of clients and customers. If these regulations are not followed properly,
this will result in business loss. In this case, Milestone hotel can face heavy penalties and fines
due to which market shares and business reputation will drop.
Implementation costs: Major objectives of IT service is to increase overall efficiency of an
organisation. Updating software and applications of IT requires large amount of capital and time.
As requirements and expectations of customers is changing on a daily basis, updating software
and applications regularly is important (Jeston, 2014). If managers in Milestone hotel did not
adopt right way to implement these software, it can result in business failure.
2.Ethical and social issues which pertains to running business
In technologically advanced business world, every organisation faces several ethical
issues. It is the responsibility of manager in a company to develop appropriate codes of conducts
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and ethics which must be sincerely abide by employees. There are several ethical issues which
takes place due to information technology. In context with Milestone hotel, ethical issues which
hotel can face due to IT are mentioned beneath:
Piracy: It is defined as an illegal copy of software and applications which can be a big
issue in managing business operations of an organisation. Copied software are unauthorised and
unauthentic due to which they are not appropriate to store and safeguard sensitive information. In
case if manager in Milestone hotel is using pirated application and software, there is big chance
of information leak. This can result in damaged reputation of hotel in market along with reduced
revenues. It is important for employees in Milestone hotel to use only original and authentic
software.
Hacking: Hacker is an individual which is skilled and knowledgeable in accessing
information and data without any authorisation. Hackers can hack software and applications
which are used by managers in Milestone hotel to store important information (Nicholas and
Steyn, 2017). Hacking of important data can be very disadvantageous for Milestone hotel, as
competitors can use their information to reduce their customer base or tarnish their reputation in
market.
Threat to security: Leaking of organisational information and customers can lead
towards big loss. While staying at hotel, customers and guests share their personal information
with hotel management. If information technology is not applied appropriately then information
of customers can be used by dangerous people in order to harm them. In case of organisations,
information leak can result in business failure.
Social issues which pertains to running business:
Defamation of business reputation: Due to technological advancement, every people
have an access to internet and social media. Big corporations like Milestone hotel are
considerably dependent on information technology for their booking and popularity. But rival
companies can use IT in order to defame the reputation of a business by spreading fake rumours.
As millions of people access internet at a single time, these kind of news spreads really fast and
without any proof, popularity and reputation of businesses reduces. This can be a big social
issues for Milestone because of IT.
Privacy disruptions: Another social issue because of information technology can be
threat to privacy and security of hotel. To make complex process easy, managers in Milestone
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hotel prefers to store all kinds of information in their operating systems. If in some case
information of clients gets leaked or shared among potential threats like criminals or robbers.
This will have a bad impact on client's life and reputation of organisation (Prajogo and Olhager,
2012).
Above mentioned aspects are some social and ethical issues which an organisation can
face due to information technology. In order to avoid this issues, it is responsibility of managers
in Milestone hotel to update their software and applications on regular basis. Due to this issues
like virus, hacking, piracy can be easily resolved. Maintaining regular records will help in storing
information in an organised and appropriate manner. This will help in securing and storing
information in a desired manner.
3. Different kinds of network technology and their differences
Network technology helps individuals in interacting with one another with the help of
computer and other electronic devices. Router, adapter, modems and cables are different
technological tools which are associated with networking and communication. Below are
mentioned different kinds of network technologies along with their difference:
 LAN: It stands for Local area network. This network technology covers limited area like
university campus, school or residence. Wi-Fi and Ethernet are common technologies
under local area network. This networking technology can interconnect up to hundred
computers but within a limited area (Swift and Piff, 2014).
Source: (LAN network diagram, 2019)
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Illustration 1: LAN network diagram, 2019

 MAN: This network technology is called as metropolitan area network. This technology
covers an area larger than LAN but less than WAN. Interconnection of several LAN
technologies results in formulating a MAN network technology. Milestone Hotel can use
it to communicate with local clients within London. WAN: It is abbreviated as wide area network and covers a large geographical area. This
network is associated with leased telecommunication circuits. This telecommunication
technology assists organisations in interacting with their clients and related individuals
regardless of location (Tayeh, Al-Jarrah and Tarhini, 2015). In case of Milestone Hotel,
this network technology will benefit them in maintaining efficient interaction and
communication with clients across world.
Local area network Metropolitan area network Wide area network
 Systems are in closed
proximity with each
other
 It is a large network
which interconnects
several organisation.
 This network
technology covers a
large geographical
area.
 Its coverage is around
2550 metres
 It has limited coverage
but larger than LAN,
near about 200 km
 It has unlimited
coverage and uses
repeater and extensions
for further
connectivity.
 It has low band width  Bandwidth of MAN is
higher than LAN but
lower than WAN.
 It possess highest
bandwidth among all
network technologies.
 Ethernet is preferred as
main communication
medium.
 Microwave and
Coaxial cables are
main communication
technologies.
 For communication
purpose technologies
like telephone and
satellites are used.
Advantages to Milestone hotel in investing in IT:
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 Increased hotel bookings: Major advantage for Milestone hotel in investing in IT is that
it will be benefited with increased hotel bookings. Internet allow customers to
acknowledge every information related with hotel in an easy and transparent manner.
Manager of Milestone hotel can collaborate with websites like hotels.com, booking.com
etc. so that customer base of Milestone can expand and high revenues can be earned.
 Enhanced guest experience: Due to information technology, processes like check-in and
check-out have become very simple and easy task. Aspects like online payments,
electronic kiosks, online check in will enhance customers experience. Due to this, more
number of customers will prefer to have repeatable visits and profitability of hotel will
enhance.
 Streamlining internal process: Information technology will benefit Milestone hotel in
becoming lean and mean by streaming their internal processes. CRM i.e. customer
relationship management is a tool which helps in managing and organising information of
customers efficiently. Due to organised information, it will be easier for employees and
managers of hotel to satisfy the demands of customers in desired manner.
Disadvantages to Milestone Hotel in investing in IT:
 Distraction in work: There are several ways by which information technology can
distract workers during their job like internet surfing, chatting and playing games online.
Distraction due to internet can results in reduced productivity of employees working in
Milestone hotel (Weske, 2012). This can lead towards customer’s dissatisfaction and
reduction in profit-margins of hotel.
 High maintenance cost: Buying and maintaining information technology is an expensive
aspect. Hiring a full time technician and expertise can cost hotel management very high
amount. Also, if computers and other electronic equipment’s will not be maintained
appropriately, overall productivity and performance will reduce.
 Makes employees lazy: As information technology helps in performing complex tasks in
a simple and timely manner, this can result in laziness among employees. Due to this
their working potential and capabilities will also reduce. Tasks like calculating sales and
managing finances will be done with computers and employees will feel reluctant in
performing their jobs (Willcocks, 2013). This can have adverse impact on the working of
Milestone hotel.
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CONCLUSION
Form above mentioned report, it can be comprehended that information technology plays
a vital role in the success of a business. But if information technology will not be implemented
properly it can result in business failure. Also, there are several ethical and social aspects related
with IT which can have a negative impact on working of an organisation. There are several kind
of network technologies which assists an organisation in interacting with customers and clients
in a desired manner.
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REFERENCES
Books and Journals
Chao, C. A. and Chandra, A., 2012. Impact of owner's knowledge of information technology (IT)
on strategic alignment and IT adoption in US small firms. Journal of Small Business
and Enterprise Development. 19(1). pp.114-131.
Fayolle, A. and Gailly, B., 2015. The impact of entrepreneurship education on entrepreneurial
attitudes and intention: Hysteresis and persistence. Journal of Small Business
Management. 53(1). pp.75-93.
Filser, M., Kraus, S. and Märk, S., 2013. Psychological aspects of succession in family business
management. Management Research Review. 36(3). pp.256-277.
Jeston, J., 2014. Business process management. Routledge.
Nicholas, J. M. and Steyn, H., 2017. Project management for engineering, business and
technology. Routledge.
Prajogo, D. and Olhager, J., 2012. Supply chain integration and performance: The effects of
long-term relationships, information technology and sharing, and logistics integration.
International Journal of Production Economics. 135(1). pp.514-522.
Swift, L. and Piff, S., 2014. Quantitative methods: for business, management and finance.
Macmillan International Higher Education.
Tayeh, M., Al-Jarrah, I. M. and Tarhini, A., 2015. Accounting vs. market-based measures of firm
performance related to information technology investments. International Review of
Social Sciences and Humanities. 9(1). pp.129-145.
Weske, M., 2012. Business process management architectures. In Business Process Management
(pp. 333-371). Springer, Berlin, Heidelberg.
Willcocks, L., 2013. Information management: the evaluation of information systems
investments. Springer.
Online
LAN network diagram. 2019. [Online]. Available
through<https://www.123rf.com/photo_23986459_lan-network-diagram-illustrator-for-
business-and-technology-concept.html>
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