Information Technology and Banking Sector Analysis Report

This report provides a comprehensive analysis of Information Technology's role in the banking sector, focusing on the Royal Bank of Scotland. It explores the advantages and disadvantages of IT, highlighting its impact on communication, customer engagement, and security. The report differentiates between intranet and internet, detailing their significance for business operations. It also examines various networking technologies like LAN, MAN, and WAN, along with the stages of the system development life cycle. Furthermore, it addresses ethical and social issues related to IT, such as cybercrime and data loss, providing insights into how banks can mitigate these challenges and maintain customer relationships. The report utilizes literature reviews to support its findings and offers a detailed discussion of the topics covered.

Introduction to Information
Technology
1

Abstract
This report has discussed all features and importance of information’s technology which are
being used by many organizations with the main aim of making their operations easy and
smoothing. Information technology is on the rise which has helped many organizations in
expanding their business. It also describes the difference between intranet and internet along
with its importance within an organization. Further, different types of networking has also
shown in this report which includes local area network, wide area network and metropolitan
area network. Different types of organization used different stages of system and software
development in which it includes mainly 7 stages of its development life cycle.
2

Table of Contents
Abstract 2
INTRODUCTION 4
Literature review 4
Role of IT in the success and failure of the Bank of Scotland 4
Ethical and social issues related to IT 5
Different types of networking technologies 5
Importance of intranet and internet in business 6
Different stages of system development life cycle 6
Analysis and Discussion 7
CONCLUSION 8
REFERENCES 9
3

INTRODUCTION
Information technology can be defined as the development, maintenance and an effective use of
computer software and networks. It refers to anything that relate to computing technology. This
present report is based on banking sector and the Royal Bank of Scotland that is one of the main
subsidiary of the Royal Bank of Scotland group Plc. Its headquarter is in the Scotland, UK. It
operates in consumer banking, NatWest holding, Finance and insurance. This present report will
discuss some advantages and disadvantages of information technology which is the reason of the
success of this bank. It will also show the difference between different types of networking like
LAN, MAN and WAN which is divided according to the coverage area and scope. Different
networking are used in different areas and purpose (Dutta, Geiger and Lanvin, 2015).
From the different points of view of authors it shows importance of internet and intranet for
businesses growth and success. Along with the quite difference between internet and intranet that
is also based on the limits and access. This report will discuss ethical and social issue that
banking sector faces and which create several problems in the path of their success. Lastly, ot
will analyse different stages of system development lifecycle.
Literature review
Role of IT in the success and failure of the Bank of Scotland
Information technology is critic and provides several benefits as well as some disadvantages to
companies, banks and individuals. According to the Gao, (2018) information technology
provides several benefits to bank such as it makes communication easier and quicker. It allows
several companies and employees to share their files and communicate with each other any time.
It has capability to deliver qualitative work to customers on the time. Cloud service provider
technology is the best example of IT which is mainly used for providing qualitative services at
affordable prices. It also helps them in engaging customers.
On the other hand, Arkorful and Abaidoo, (2015) said that information technology creates
several privacy and security related issues to banks. It can become the reason of the failure of
their business. The main disadvantage of using information technology is it creates
unemployability in the society which is not good for businesses and people as well. Excessive
4

use of E-mail in hurry and emergency can create privacy and security related problems for banks
and customers. They can not even contact with customers directly which can decrease
interpersonal relationship with them. There is a requirement for the bank to meet with their
customers for solving their problems in detail.
Ethical and social issues related to IT
There are several social and ethics related issues occurred in information technology. It provides
several benefits but has some issues. As per the view of Miller and Blackler, (2017) the main
issue of information technology is cyber crime and unauthorized access. Identity theft of users
and consumers of banks, hacking of personal account are some types of cyber crime. Increasing
use of IT is increasing the risk of hacking. Several hackers can get link of unauthorized access by
which they can get any type of sensitive information’s.
Whereas, Hajli and Lin, (2016) said that rather than this issue there are several other issues
which occur in IT such as data loss and access to sensitive information’s. Unpredictable and
natural situations can damage all data that are secured in the syste4m. Flood, fire and entry of
unknown individual in an organization. Bank is one of those organizations who need to be more
secure and use software for protecting itself against this type of issues. They also need to pay and
recover all those damages to customers that occur within the bank for maintain a good
relationship with them.
Different types of networking technologies
In the context of types of networking it can strongly said that it has 3 types such as local area
network, Metropolitan area and wide area network. In the type of local area network, all personal
system of an organization can share information’s, files and has some types of limitation. There
are limited numbers of computers can be added in this type of network and that is why it is
known as local are network because it covers a local and narrow area Lee, SOHN and Seok,
(2018).
In the context of Metropolitan area it can be said that it covers more geographical area than
local area network. It can connect 2 or may be more than 2 computers. It covers large area that is
why individual cannot maintain it in an effective manner. It has divided into 2 types such as
switched multimegabit data services and queue dual bus which are comparatively expensive.
Wide area network covers a more large area and for this type satellite link and PSTN can be
used. It is also difficult to maintain and getting qualitative works because it increases the chances
5

of errors as it covers large area. It allows a large group of computers to communicate and share
files Maveli, Nagaraj and Yu, (2018).
Importance of intranet and internet in business
According to the Fleisch, Weinberger and Wortmann, (2015) internet is playing a big role in the
success of business such as it makes communication more effective, easier and quicker. By
making communication effective, companies can increase employee and customer’s engagement.
On the other hand, Mougayar, (2016) stated that the main benefit of internet is it increase overall
productivity by making them able to update marketing strategy. With the help of digital
marketing, an organization attract wider range of customers and increase its sales. In addition,
they also said that it is not only beneficial for employers but employees can also get any type of
information’s any time.
In the context of intranet, Azam and Siddiqui, (2017) said that there is a little difference
between internet and intranet. Intranet is restricted and has limit access as compare to internet.
By making an effective use of intranet, companies are making qualitative and errorless products.
Whereas, it can be said that intranet is a private network that many company use for making its
internal communication effective. It helps banking and other sector businesses to speed up their
operations and workforce. Employees can also get the access on the common file which boost
their confidence and morale as well. It is becoming more easier for all people in teh world to
interact with anyone any time. In the context of business it can be said that there are several
organizations who has made an effective use and operate their business. E-commerce, banking
services are some examples of businesses who are being run by internet.
Different stages of system development life cycle
In banking sector and in the context of HSBC it is interpreted by Ashby, Blessner and
Olson, (2019) that there are mainly 5-7 steps of SDLC. Business system planning, analysis of
requirements, system design, developing, testing, system implementation and maintenance are
some steps by which banks can update and develop their software’s and system for performing
all business activities efficiently. Planning and system analysis phase plays a vital role in which
company decide that exactly what they want to do and which type of problems they are trying to
solve. In both steps they make plan and identify ways that how they make effective and better
services. They also oversee that how will the system will perform.
6

In addition Sigogne, Mornas, Tonnellier and Garnier, (2016) system design and implementation
makes the software and system development more effective. It is being done after knowing the
requirements of customers. After analysing all needs of customers, bank tries to design its system
accordingly which can meet all technical and functional requirements physically as well as
logically. After this step, system becomes ready to be deployed and installed in customer’s
premises, ready to become running, live and productive. After all these 4 main steps, system
testing also plays an important role. For knowing that system is made according to the plan and
can give satisfactory services to customers or not, testing is important. After completing all these
steps, banks also require to maintain system in which they replace old hardware’s and
continuously evaluate system’s performance.
Analysis and Discussion
From the above literature review it can be discussed and analysed that information
technology have both advantages and disadvantages which can support the company to become
success and can create problems and make the business failure. It all depends on the company
that how they use their system and information technology. If they have enough financial and
human resources then they can invest in advanced technology and tools that can support them in
preventing themselves from ethical and social issues such as unauthorized access, phishing, loss
of data etc. Further it can also be analysed that internet and intranet both plays an important role
in banking sector and just have a quite difference. The main purpose of using both in business is
help employees and public to share information’s and accomplish organizational goals. The main
difference between internet and intranet which is being analysed from the above is internet is
an open and public space, whereas, intranet is being developed to be a private space. Intranet is
more secured and safe with password and can be used only by authorized person. So, there are
less chances to get information’s leaked in intranet.
It is also analysed and discussed from the above questions that different types of network
plays a vital role. All types of network like LAN, MAN and WAN is all depends on the size and
scope of the company. If an organization is small in the size then it prefers local area network
such as school, hospital where all personal computers can share files and information’s. MAN
covers large geographical area and allows multiple computers to interact and shares files. It is
being used for cities and towns and give moderate speed because it covers large area than LAN.
7

In teh context of WAN, it can be discussed that it gives low speed because it is being used
country and covers wide area for network. There are several computers can interact with each
others in this type of networking (Mocetti, Pagnini and Sette, 2017).
Further, from the question of different stages of updating and developing system life cycle it is
analysed that some authors said it has 5 stages and some says that it has 7 stages. It is analysed
that with the help of 6 stages, any type of company can develop system life cycle and provide
better services to customers. Planning, analysis, design, implementation, testing and maintenance
are main 6 steps which are essential for banking and other sectors to be followed for system
development lifecycle. All these steps can help the company out in saving cost and time as well
as minimize risk of not meeting and satisfying customers needs. Banks first preferences is
customers and for them its is important to perform all those activities which can satisfy them.
System development is one of them because customers needs changes rapidly and for maintain a
balance banking sector fulfil their needs and being in a competition (Malik, 2016).
CONCLUSION
It has been concluded from the above discussion and report that information technology
has increased the value of banking sector. Information technology has several advantages along
with some disadvantages that became the main reason of the success of many businesses. It has
also shown the different types of networking and ethical issues related to IT. Further this study
has discussed some importance of internet as well as intranet in the success and growth of
banking sector. Lastly, it has also been concluded that different stages of software and system
development life cycle made able to business to accomplish their goals.
8

REFERENCES
Books and journal
Arkorful, V. and Abaidoo, N., 2015. The role of e-learning, advantages and disadvantages of its
adoption in higher education. International Journal of Instructional Technology and Distance
Learning. 12(1). pp.29-42.
Ashby, D., Blessner, P. and Olson, B., 2019. An investigation into the impact of applying
systems engineering life-cycle processes during new product development and the economic
growth of the diversified industrial sector. Journal of Enterprise Transformation, pp.1-23.
Azam, Q.S. and Siddiqui, M.Z., 2017. Customized Mechanism for Cloud Based Data Sharing
Over Intranet-Study Based on Survey Conducted for Pakistani Business Industry. International
Journal of Engineering Innovations and Research. 6(2). p.56.
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).
Fleisch, E., Weinberger, M. and Wortmann, F., 2015. Business models and the internet of things.
In Interoperability and Open-Source Solutions for the Internet of Things (pp. 6-10). Springer,
Cham.
Gao, J., 2018, November. Analysis on the Development Trend and Disadvantages of College
English MOOC in the Information Age. In International Conference on Contemporary
Education, Social Sciences and Ecological Studies (CESSES 2018). Atlantis Press.
Hajli, N. and Lin, X., 2016. Exploring the security of information sharing on social networking
sites: The role of perceived control of information. Journal of Business Ethics. 133(1). pp.111-
123.
Lee, D.W., SOHN, I.S. and Seok, Y.H., LG Electronics Inc, 2018. Method for channel sounding
in wireless local area network and apparatus for the same. U.S. Patent Application 10/057,036.
Malik, V., 2016. Impact of information technology on banking services comparative analysis of
public and private sector banks.
Maveli, N., Nagaraj, A. and Yu, P., 2018. Data bandwidth overhead reduction in a protocol
based communication over a wide area network (WAN). U.S. Patent 9,876,612.
Miller, S. and Blackler, J., 2017. Ethical issues in policing. Routledge.
Mocetti, S., Pagnini, M. and Sette, E., 2017. Information technology and banking
organization. Journal of Financial Services Research. 51(3). pp.313-338.
9

Mougayar, W., 2016. The business blockchain: promise, practice, and application of the next
Internet technology. John Wiley & Sons.
Sigogne, A., Mornas, O., Tonnellier, E. and Garnier, J.L., 2016. Co-engineering: a key-lever of
efficiency for complex and adaptive systems, throughout their life cycle. In Complex Systems
Design & Management (pp. 19-37). Springer, Cham.
10