Assignment 2

2012/12/14

E-Commerce Technology IIT 312-2 Lecturer:- S.F Fasana Faculty Of Management Uva Wellassa University

S.M.U.C Seneviratne UWU/IIT/10/0038

Case study :A medium size bank is in the process of installing a web site that would allow it to interface with larger global company on a full time basis. The bank has 89 employees, $189 million in assests, 20000 checking accounts, 11000 customers and intense competition from naighbouring banks for marginal customers. The bank is customer oriented in the classical style of shaking hand and greeting people by name. The trend, How ever is for the younger, computer-literate customers (such as students in neighbouring university) to want a different kind of customer service. The bank wants to be part of the internet community and want to grab the cyber-customer for information access, issuing small loans, and other services. You are the consultant. What questions or informations would allow you to advice the bank on its readiness to make use of a web site? By following business excellance stratergy, what would you emphasize that the bank must do, and how?

Questions or information that would allow consultant to advice the bank on its readiness to make use of a web site are given below.
Agreement information between the medium-size bank and the larger global company :According to the case informationmedium size bank is going to be connected with a larger global bank for the full time basis through the web interface. In a such a case it is important to study about the benefits that can be achieved by the medium size bank according to the agreement. And also it is important to identify what kind of benefits that the larger bank expects to achieve through the interconnection. Survey informations collected by the organization :To get into an effective decision about the new approuch, organization should organize some surveys with both employers and customers of the bank to identify their attitudes and suggetions about the new approuch. Local and global policies regarding the new approuch :Implementing a web site which is to be used for global financial transaction is governed by many complex local and international legal regulations. According to the internal and external factors those regulations may cause to reduce the expected benefits from the new approuch. So it is necessary to observe the legal points which affect on the project from both sides. Functions that is going to be enabled through internet :To evaluate the effectiveness of the new approuch, banking functions which are going to be enabled through internet should be identified initiatively. Because online approuch may not become effective for some complex banking functions as well as some target groups. Especially it is unsecure to maintain banking operations which depend on sensitive information regarding the customers. There is a possibility to be avoided those kind of facilities from the customer. Target customer groups of the new approuch:According to the target customer group of the project, business stratergies should be changed. From the available banking functions to even user interfaces of the site should be designed according to the particular customer group. Most of times busy and young customers are effectively attracted by online banking services. Current online approuches of the competitive bank :If the competitive bank is already a part of the online community, we have to identify the services which they are providing to their customers and what is their competitive advantage within the business to build stratergies for the new approuch. Then only we can identify their strengths, weaknesses and oppertunities, threats for our side. Technical accessability of the customers in the nich market :No use of an online approuch if the most of customers in the current nich market is not easily accessible to the new online approuch. It means wheather the customers have necessary technical knowledge, technical resources, supportive services etc. to get the online services. If not it will reduce the market share of the organization and project will be only a cost for the organization. Capabilities of the IT department of the organization :To maintain a web site which is doing online financial transactions locally and globally requires qualified human resources and advance technology. So, the internal IT force should be consisted of those things to face to technical troubles like failures, security constraints etc. So it is necessary to have that identification to evaluate the risk of the approuch.

How much the company ready to invest on the new approuch ? This is a main question that should be answered by the organization to identify wheather the organization is really in a investment policy to start and running the project. Initial cost for the implementation :Initial cost for the development is an important fact to estimate the financial benefit which can gain from the project and compare its cost with the need. Estimated time for the implementation :The required time period to implement the system must be known to identify wheather its usefulness is secured even at the end of the implementation. By the time estimation for completion of work, we can predict and ready to face changes in the legal, technological, economical etc. in the business environment. Number of new employees required to maintain the new system :This fact should be estimated to get decisions about the future recruitment process of the organization and the future arrangements on the employees. As examples through this information, decisions can be made to eliminate current positions and rearrange them with the new system as well as recruit employees to new positions with new qualifications which suite for the new technical environment.

According to business excellance stratergy what would the consultant emphasize that the bank must do and how is as below.
According to the context of the considering organization since it is a medium size bank, has a strong competitor and with an idea to interconnect with a global bank, continuos -innovation excellance stratergy concepts should be used to achieve a more stable and profitable state in the current industry. According to the past business stratergies they were developed mainly based on a paper based business process and all the customer services were developed without considering the novel technical persepectives. And also their stratergies were oriented only to a set of local customers. With the present business stratergies, bank decides to provide some of its services through online and interconnect with a global bank using a web site as the interface. Those stratergies are mainly based on online perspectives. And with its plans, wide range of global customers will be acquired to its nich market. Those stratergies require risk oriented management style and an environment which encourage the innovations. To accomplish the novel organizational stratergies organization should gather the employee and customer ideas through several survey processes to identify the actual requirements and suggetions to create future business values it will reverse the value chain of the organization. To create an efficient work force to maintain the complex technical environment which is going to be held after the establishment of online system, organization should reform its current IT department if its available or form a new department if it is currently unavailable. IT department should be rich in not only skillfull human resources but also technical resources to maintain its IT functionalities. Additional funds should be allocated to IT section while minimizing other operational costs. Recruitment process should be changed and new qualifications should be required by the applicant related to the working in an IT environment. Organizational hierarchy should be reformed by adding new positions and eliminating outdated positions from it. To secure the current market proportion of the organization, it is not recommended to revert the current processes to online at once and eliminate the paper based service. It is strongly recommended to give the chance to customers to decide wheather to choose online service or stay with current paper based system. But bank should catalyse the customers through marketing stratergies to be converted to the online services as it is profitable to both customers and organization. It is must to estimate required cost and time for the implementation of the online system at the beginning and analyzing their benefits with the future changes. Initially it is better to to outsource the implementation of the system to an otside development company due to the lack of experince and technology in the initial period of the organization. But, organization should consider to do the maintainance of the online system in-house to minimize the future operation cost of the organization. On-line system should be tested with IT specialists for its security and accuracy. System should be trust wrothy before open it to the customer services. Testing is a time consuming function in a development process, to minimize the impact of delaying the releasing the online services to customers, organization can open tested services for customers mean while others are being tested.

When it comes to the future stratergies of this organization, a culture for innovation should be developed and should be able to continuously delight the customers with novel services. In the future, medium size bank should be able to provide the global money transaction service to the customers with help of global bank. That will increase the nich market share with the global customers other than the local customers. As another stratergy, organization should be able to introduce novel bank services which is compatible with online perspective and attract the young generation to the organization. In the future by using the online system, bank can act as a third party between other organizations and their customers to earn additional income and attract those organizations and their customers to the common banking services as own customers.