Information technology provides companies with the ability to process large amounts of information and do so in a way which presents the information in a clear and concise manner to employees. Anticipated benefits of implementing an information technology system include improvements in productivity, better profit performance, and a higher degree of accuracy among information within the firm. The ability to share information among employees is also enhanced.
Most information systems have at their heart a database management system which may take one of several forms. Ideally, the database management system allows multiple users to access information at the same time, and is flexible enough and easy enough to use so that employees can write reports and make modifications to their portions of the system quickly and easily. When this is the case, the benefit to organizations can include higher morale as well as higher productivity.
However, it is also possible for companies to come to rely entirely on information technology in their daily activities. This can pose problems in the event that the computer becomes unavailable (perhaps because of a natural disaster). In addition, financial institutions are attractive to computer hackers who may try to thwart security precautions for their personal gain. Prevention programs must be implemented in order to overcome these threats.
Another negative impact of computers on organizations (particularly those in the banking industry) is an over-reliance on the information which comes from the computer. This is particularly true when expert systems or neural networks are introduced into the work environment, and can be highly problematic when analysis such as is routinely performed in the investment banking industry is involved. In these situations, analysts may come to rely on the information presented by the computer (or the recommended strategy of the computer) without understanding...