An Analysis of Information Technology's Role in Business Operations

This report provides a comprehensive analysis of the role of Information Technology (IT) in business, using HSBC Bank as a case study. It explores how IT contributes to both the success and potential failure of a business, highlighting advantages such as quick data transfer, effective communication, and data privacy, while also addressing financial burdens, data theft risks, and complexity. The report delves into ethical and social issues, including labor unions, discrimination, nepotism, and the impact of modernization, alongside ethical concerns like sexual harassment and discrimination. It differentiates between various networking technologies like LAN, WAN, VAN, and EPN and explains the importance of social media for advertising, promotion, and overall business growth. Finally, the report outlines the stages of the software development cycle. Overall, the report offers a detailed overview of IT's multifaceted impact on business operations and strategy.

Introduction to
information Technology

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Role of IT in the success or failure of a business...................................................................3
Ethical and social issues while running a business................................................................5
Differentiation between different type of networking technologies.......................................7
Importance of social media in a business...............................................................................8
Explanation of different stages in software development cycle.............................................9
CONCLUSION.............................................................................................................................10
REFERENCES..............................................................................................................................12

INTRODUCTION
Information and technology plays a crucial role in today's modern world. Information and
technology uses modern machinery equipments like computer systems,internet,electronic devices
and hi-tech systems in order to facilitate transformation of information from one source to
another. IT also helps in data interpretation for an user which is very essential in performing any
task. In recent times IT has changed work patterns in various organisations and institutes and has
made them to function smoothly (Alfalah, 2018). This report will cover role of IT in success or
failure of a business, ethical and social issues associated with running businesses. This report
will cover differentiation between different types of networking technologies and the importance
of social media in a business. This report also covers different stages of software development
cycle.
MAIN BODY
In this report example of HSBC Bank is taken into consideration for better understanding the
given topics. HSBC Bank was founded in the year 1865 at Hong Kong,China. HSBC is
headquartered in London. HSBC Bank is one of the major bank in UK and conducts its banking
operations all over the world.
Role of IT in the success or failure of a business
IT play a major role in business operations and promotes a business to a next level which
means that it is important for a business to implement IT functions. HSBC bank has deployed all
necessary modern equipments in the business in order to ensure prosperous banking operations.
Information technology can change environment of a business which is very essential in the era
of stiff competition (Brooks, 2017). IT mainly impacts the external and internal environment
of a business in which plays an important role in the functioning of a business. IT can lead to
development in a business and absence of IT can put a business into a trouble. Various
Advantages of IT which can lead to success in a business are mentioned below:
Role of IT in the success of a business
 Quick data transfer- Information and technology helps in transferring of data from one
source to another in a quick manner. IT has developed various methods like email,mobile
phones and websites which are powerful in transferring appropriate information in a

quick manner. HSBC bank generally uses email which is effective in transferring safe
information to other banks.
 Helps in effective communication- Communication is important in this modern world as
it is essential for a multinational company to communicate for its global operations
(Chae, 2018). In order to communicate in a fast manner HSBC uses upgraded
information and technology to make ensure its communication is done in a precise
manner. In Banking functions communication plays an important role as HSBC is a
multinational bank all the information is passed through proper IT channels.
 Maintains data privacy- Data privacy is important to the organisation in order to protect
stealing of crucial information of an organisation. As HSBC performs banking operations
of high monetary value,it is important for the bank to apply data privacy in its
transactions. Customer information is crucial and confidential for a business,use of
Information and technology enhances data privacy for the organisation.
Role of IT in failure of a business
Information and technology has disadvantages also which can lead to failure in a
business,IT also has major drawbacks which can lead to a sudden fall in a business and it can
also bring obstacles in a business. Various IT factors which could lead to failure in a business are
mentioned below:
 Creates a financial burden- Information and technology is costly for a business which
may increase expenses and can put a financial burden on the company (Dong, 2017). It
can also increase liabilities for a company in long run which creates a debt on a firm and
can even lead to the path of organisational failure.
 Chances for data theft- In today's world banking sector is dependent on information and
technology in a major sense. HSBC has stored all the necessary information related to its
operations on internet,so ethical hacking could be a major threat to the company
(Hendon, 2017). In today's world chances of ethical hacking are increasing day by day
and is a major threat to most of the organisations.
 Creates complexity- Complexity is a major hurdle in information and technology sector
as Information and technology sector includes complex and rigid operations which can be
hard for an organisation to maintain. It is responsibility of IT professionals to manage
operations in a business,with respect to rigidity in the business operations it becomes hard

for a business to cope up. It can cause failure in a business when complexity level
increases in IT sector.
(Source: Role of IT, 2010)
Ethical and social issues while running a business
Ethical and social issues majorly impacts on the internal as well as on external
environment in a business,a business has to maintain good ethics in its operations in order to
achieve high growth rate (Ethical and social issues in a business,2021). Social also plays a key
role in formulation of business strategy as society influence the business in a precise manner.
HSBC bank deploys all the necessary practices in order to over come social and ethical issues.
Explanation of social and ethical issues in a business are given below:
Social issues while running a business
Illustration 1: Role of IT in business

 Labour unions- Impact of labour union on a business plays a major role in determination
of level of output. It also impacts performance and productivity of a business as well it
plays a key role in deciding business strategy. Generally,it is observed in banking
operations HSBC bank is impacted by labour strikes and protests in which they demand
increment in their wages and salary. It is often observed in banking sector that employees
demands increase in their respective salary which can be a major issue for bank in
conducting smooth operations.
 Discrimination in employment practices- Due to cultural diversity in an
organisation,false employment practices arises (Mauerhoefer, 2017). Discrimination by
employer is often observed at workplaces which leads to decrease in performance of an
individual. As HSBC conducts global operations in 64 Countries so maintaining
cultural diversity is a major issue in its operations.
 Modernisation – In 21st Century operations of a business should be modernised
according to needs of society and market trends. This is a major challenge and issue for
banking sector which leads to change in functions. Management of banking sector should
bring modernisation in its functioning in order to survive in the market. Traditions in the
society changes time to time which means that in order to survive a company has to adopt
changes.
Ethical issues while running a business
 Sexual harassment- Sexual harassment is a major ethical issue in a business,it includes
abuse,assault and false gestures to a woman at the workplace. This issue generally arises
out by the presence of cultural diversity in an organisation (Rad , 2018). Sexual
harassment makes conflicts and grievances in an organisation and it becomes
responsibility of the management to handle and resolve them in a short span of time.
 Discrimination- It is often observed in a business that discrimination is performed by
employer which directly impacts upon the performance of an employee. As HSBC bank
is a multinational firm practices related to discrimination is often observed and seen in
the operations (Ratwani, 2019). Thus,it becomes hard for the bank to overcome
discrimination challenges, it is also important for the bank to deploy professional human
resource management which effectively addresses grievances related to discrimination.

 Nepotism- It refers to the power of top management to manipulate a business and to do
essential favour of their known people in the organisation. This is a major ethical issue
observed in an organisation,which is hard to be abolished or controlled. In HSBC bank
cases related to nepotism are observed on daily basis which is a major challenge for this
bank in long run.
Differentiation between different type of networking technologies
Networking technology in a business uses various through transfer of information and
technology is performed in conducting business operations. It includes advance technology
measures in order to establish effective communication and transferring of information which
facilitates working and develops an effective working conditions (Santisteban, 2017). By use of
Networking technology it is also easier for banking sector to conduct operations of a business
and achievement of excellence in work is also facilitated. Various networking technologies used
at HSBC are mentioned below:
 Local area network (LAN)- Local area network connects devices and computers in a
small size area which can be a small building or a small office. This network connects
generally fifty computers with each other in order to perform internet operations. Router
is used in local area connection for network establishment. HSBC uses local area network
in its major branches in order to gain information and technology advantage.
 Wide area network (WAN)- Wide area network is basically a type of networking
technology which is used in establishing long distance connections. Wide area network is
expensive as it transfers internet and technology to different regions. HSBC also uses
wide area network to maintain global banking transactions and communications in a
business.
 Virtual area network (VAN)- Virtual area network is also known as assisting network
which helps an user to transfer necessary data even computer is connected to a private
network. Virtual area network makes global transferring of information easy and is also a
cheap source in internet operations. HSBC uses virtual area network in its private
operations in order to conduct safe and quick transactions.
 Enterprise private network (EPN)- Enterprise private network can be a wide or short
area network which is used for conducting secure operations. It is fully a private area
network which is main source of maintaining information privacy.

Importance of social media in a business
In the era of information and technology all over the world,social media plays a key role
in a business. Social media is used by 3.96 Billion people in the world as spread of internet
technology is growing in a rapid manner so it helps a business in easing of its operations
(Importance of social media in business,2021). When it comes to banking sector,banks often use
social media platforms for performing different functions (Tanriverdi, 2020). Social media plays
a key role in determination of business objectives as well as it helps a business to gain
competitive advantage. Explanation of importance of social media in context of HSBC bank is
explained below:
 Advertisement- In this modern business competitive world,it is essential for every to
perform advertisement for its products and services. Advertisement is an essential
function of a business in order to increase sale of its products and services. In banking
sector advertisement is performed in order to increase its services. HSBC uses famous
social media websites like Facebook,Instagram and twitter in order to effectively utilise
for its services.
 Promotion- Social media websites also helps in promotion of products and
services,major multinational banks use social media platforms in order to create a global
promotion of their services. Promotion creates more awareness in mind of customers and
they get attracted to the services of a product in a precise manner. HSBC promotes its
banking services on social media all over the world which creates development in its
banking operations.
 Growth and development- Social media not only helps in promotion and advertisement
of products and services but it also increases growth of a business. It also leads to
expansion of a business by facilitating a business in its operations (Torten, 2018).
Attraction caused by social media in minds of the customer helps in achievement of sales
and services targets and automatically creates development in an organisation. HSBC has
gained 27% growth by using social media in its functioning,it means social media plays
an important role in growth of a business.

 Communication- Social media acts as a medium of effective communication in a
business. The business through social media can communicate with target customers
directly all across the globe. This play an important role in formulation of target customer
satisfaction as social media also provides help and support which resolves customer's
queries. HSBC communicates to target customers through social media on daily basis and
the bank has also formulated a separate team for performing social media operations.
 Customer feedback- It is important for every business to conduct customer feed back in
order to maximise its customer handling performance. Through social media,important
customer feedback is achieved in a business which plays a crucial role in optimising
performance of a business (Toyama, 2018). Business also gets flexible according to the
feedback achieved from its customers,banks also get influenced by the feedbacks of
customers. HSBC bank has established a separate space on social media in order to get
feedback from its customers.
 Branding- Branding is essential for multinational companies in order to create a global
image of its products. Most of the global banking companies prefer branding in order to
satisfy and attract a major number of customers. Branding has become a necessary
element in operation of a business,HSBC bank prefers branding and wants to set global
standards in its banking operations.
 Helps in competition- In this era of stiff competition between companies it is
environment of competition. In banking sector, major banks compete with each other to
develop competitive advantage in their functioning. HDFC faces major issues related to
competition in the market as major global banks like Bank of America,China
construction Bank,Bank of China etc. Social media helps in creating a competitive
advantage.
Explanation of different stages in software development cycle
Software development cycle refers to all the necessary stages which helps in building a
specific software. This cycle includes different phases throughout which a software development
undergoes. In other words,software development cycle includes all necessary aspects which
plays an crucial role in functioning of a software(Vanpoucke, 2017). Software development
cycle is the primary stage under which a software is prepared for management information

system in an organisation. Stages in software development cycle with their explanation is given
below:
1. Requirement analysis- It is the Initial stage in software development under which
analysis of requirements is done. In other words,a software developer identifies what are
the requirements of software that has to be developed in most of the cases. It is essential
duty of the software developer to identify correct purpose of developing a software. It
also determines what are the factors which a software developer has to consider in order
to manage software operations. Essential requirement assessment helps a developer to
identify all the necessary steps a software developer has to take into consideration while
designing a software.
2. Planning- Planning is the secondary stage which includes development of strategy which
helps a user in developing a software. Planning is essential in formulating necessary
actions a software developer has to take in order to make a perfect software.
3. Design- Software design is necessary in software development cycle as it helps in
developing architecture for the software. Software design is important tertiary stage in
formation of software under software development cycle. Design of a software plays a
crucial role in development of structure of software and develops necessary parameters in
formation of a software.
4. Build- It is the most necessary and important stage in development of a software as it
includes formation of a software. Software building is performed in a professional
manner in order to develop a comprehensive approach in software making. This stage
under software development uses programming in order to perform major software
development procedures.
5. Code test- Code test is conducted after software building which includes testing of a
software in order to bring out major defects and deficiencies in the prepared software.
Code test is performed by IT professionals to check various mistakes in a software. If
mistakes and defects are found in a software then IT professionals rectify it in a given
time. Code test is also performed in order to bring modifications in the software.
6. Software deployment- Software deployment is the final stage in software development
cycle which includes a fully prepared software's deployment. This stage includes use of a
developed software in production environment.

CONCLUSION
From the above stated report it can be concluded that introduction of information and
technology has changed this world by bringing advance and effective technologies in the
business. It can be also concluded that Information and technology directly impacts on the
performance and functioning of a business. It can be also concluded that a business is impacted
largely by social and ethical issues and it also helps in understanding role of IT in the banking
sector as well. It is also observed that a software development cycle also plays a crucial role in
formation of software.

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.
Brooks, D.C. and Pomerantz, J., 2017. ECAR Study of Undergraduate Students and Information
Technology, 2017.EDUCAUSE.
Chae, H.C., Koh, C.E. and Park, K.O., 2018. Information technology capability and firm
performance: Role of industry.Information & Management,55(5).pp.525-546.
Dong, J.Q. and Netten, J., 2017. Information technology and external search in the open
innovation age: New findings from Germany.Technological Forecasting and Social
Change,120.pp.223-231.
Hendon, M., Powell, L. and Wimmer, H., 2017. Emotional intelligence and communication
levels in information technology professionals.Computers in Human
Behavior,71.pp.165-171.
Mauerhoefer, T., Strese, S. and Brettel, M., 2017. The impact of information technology on new
product development performance.Journal of Product Innovation
Management,34(6).pp.719-738.
Rad, M.S., Nilashi, M. and Dahlan, H.M., 2018. Information technology adoption: a review of
the literature and classification. Universal Access in the Information
Society,17(2).pp.361-390.
Ratwani, R.M., Reider, J. and Singh, H., 2019. A decade of health information technology
usability challenges and the path forward.Jama,321(8).pp.743-744.
Santisteban, J. and Mauricio, D., 2017. Systematic literature review of critical success factors of
information technology startups.Academy of Entrepreneurship Journal,23(2).pp.1-23.
Tanriverdi, H. and Du, K., 2020. CORPORATE STRATEGY CHANGES AND
INFORMATION TECHNOLOGY CONTROL EFFECTIVENESS IN
MULTIBUSINESS FIRMS.MIS Quarterly,44(4).
Torten, R., Reaiche, C. and Boyle, S., 2018. The impact of security awareness on information
technology professionals’ behavior.Computers & Security,79.pp.68-79.
Toyama, K., 2018. From needs to aspirations in information technology for
development.Information Technology for Development,24(1).pp.15-36.
Vanpoucke, E., Vereecke, A. and Muylle, S., 2017. Leveraging the impact of supply chain
integration through information technology.International Journal of Operations &
Production Management.
Online
Importance of social media in business.2021.[Online]Available
through:<https://coschedule.com/blog/benefits-of-social-media-marketing-for-
business/>
Ethical and social issues in a business.2021.[Online]Available
through:<https://www.become.co/blog/ethical-issues-businesses/>
Role of IT in business.2010..[Online]Available
through:<http://20103000.blogspot.com/2010/03/chapter-1_05.html>