Behavior of communication

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In this century, the human to human communication is very important. The internet rapidly growth it changed many people behavior of communication. And it also affects most of the industry and increased the performance of the productive.

In this report will try to present the different methods of enquiry system and show their characteristic. Evaluate the impact of online shopping on the MNC of grocery shop. In addition, will using SSM model to explain the impact on IS planning of online shopping. And will also use Effect/Probability/Action Grid of consequence analysis techniques to analysis the impact of online shopping on the MNC. At last, we will work on the ethical issues of online shopping on the MNC.

Different kind of Enquiry Techniques

Introduction of Inquiry System

An Inquiry system (IS) is a system which is used for finding the truth and knowledge based on two or more objects that inter-related. The objects of an inquiry system are unique and special data that used to convert to valid knowledge for action. A guarantor will perform to validate the accuracy of the result which is based on input and output. The guarantor is the most crucial factor of an IS because it literally influences everything it does (Mitroff & Linstone, 1993). A suitable enquiry method can help to trim down the risk and understand the existing situation.

Normally the problem can be introduced in two-way, bounded and unbounded problem. The bounded problem means the situation it limited in a set of boundary. Unlike unbounded problems it do not have boundary of the situation. It means the problem can be turned on infinity. During the situation, the viewer will stand in different point of views based their assumption of inquiry.


Inductive-consensual normally relies on number of observation or thousand of individual data. This methodology always applied the situation which not complicated and structured. The finding can be easily got from the pass observation. For example, pass experience and history. The concept of this system is to get the best answer by multiple individual collected sources. And it also depends on the integrity of the process.

Delphi is one of kind of this enquiry system. This system started to collect the answers from a group of experts. And it consolidates those and removes the non-sensible answers. The finding will be performed by the most reliable source and answer from the collected data. The system will start to debate those answer by roundly basic. After few around debate, it will come out the reasonable answers. Then the system will use the final answer to form a theory in order to explain the situation.

Every enquiry system is having own weakness. In this system, it need spent a lot of time for collecting the data and observation result. It is very time consuming, and also it only suit for the well structured situation. There was a case stated in "The Unbound Mind'. It said for the expected tonnages of steel produced by Japan versus the United States in the year 2000 (Mitroff & Linstone, 1993). The result may have so many combinations since the expert are distributed in different country and location. It is very time consuming to repeat the debate process and to get the reasonable answers.

Analytic Deductive

Analytic Deductive is one of the common enquiry systems we used today. And it widely used on mathematician, scientists and physicist. Besides, it used at universities as a way to perform research. This methodology is based substantiate theory, formula and logical reasoning to predict and explain the situation. (Mitroff & Linstone, 1993).

This advantage of this approach is the conclusion will be based on and supported by theory and formula. And it made the conclusion become more realistic and accuracy.

However this approach also have disadvantage. As the results are based and supported by formula and theory. In case the guarantor does not similar with that. It may lead unstable answer.

Although, it having such disadvantage. However, it stills the most efficient method of the enquiry system. It was because it reduced the time consuming to collect the data and observation result.

Unbounded Systems Thinking and the Multiple Perspective

The Unbound Systems Thinking is the next generation thinking techniques we used today. Although this is new set of thinking technique and also design for the mess situation. However no one can guarantee that it can solve any problem situation.

As stated by Mitroff & Linstone, Unbounded Systems Thinking can be call as "the Fifth Way of Knowing". And it also represents it as Multiple Perspective during the enquiry.

The Multiple Perspective contains three component, Technical / Organization and Personal perspective. It used those components in order to address the complicated and mess problem situation. (Mitroff & Linstone, 1993). Originally, the Technical perspective was learned from the older enquiry system. And the multiple means added two perspectives in order to deal with complex problem and mess situation.

Interaction between those perspectives is very important. And those should connect together to form the relationship with each other. However those perspectives have to able to count all the different components into account. (Mitroff & Linstone, 1993).

Planning of the Research

The Research planning will focus on online shopping of MNC in food retail sector. And we are going to use below models and methodology in order to analysis the problems.

Soft System Methodology (SSM) is one of famous analysis tool developed by Peter Checkland in the early stage at the University of Lancaster in UK (William B.,2005). This is a tool to analysis the unstructured problem in real life. And we will use this to perform the research, analysis the impact of technological innovation at the online shopping in the MNC from the food retail sector. SSM is mainly focus on natural, society, politic and human behavior. (Peter C.,1981) And it is suitable for our case study topic.

SSM generally separate in seven processes as below.

  1. Unstructured problem situation (Capture From Real World)
  2. Expressed Problem Situation (Capture From Real World)
  3. Root Definition and Relevant Systems (System Thinking applied on Real World)
  4. Conceptual Models (System Thinking Applied Real World)
  5. Comparison ( Compare of the Model)
  6. Discuss about change (Discuss on Real World)
  7. Perform Action (Action on Real World)

In the phase one, we have to define the problem. And now we are facing problem is how information Technology using in the online shopping that affect the MNC of Food retail sector. The problems appear that are unstructured in this stage. The data collections have to perform before express the problem on phase two.

In the phase two, we got defined problem from phase one. And we have to start to express the problem by using Rich Picture. The Rich picture will be containing human to human interaction, process, conflicts between stakeholders, issues and constraints etc.

In the phase three, we have to create the root definition in order to generate the CATWOE. The root definition shall included parties of situation which it involved. For the CATWOE it used to present the human activity of the situation.

In the Phase Four, Conceptual Model will be created when root definition is well defined. And it used to list the activities from root definition.

In the Phase Five, Once those tools are created. We will start to compare the models and real world. And perform discuss to and get the related change. Finally, we have to perform the related action to improve the situation.

This research will also perform some business strategic

The research will also illustrate business strategic analysis by applying the macro environmental analysis using cognitive map with PEST analysis and Micro environmental analysis with SWOT analysis. It will also evaluate the impact of IS strategic planning by Porter's five model.

Consequence analysis for used for risk assessment. The use of Effect / Probability / Action Grid can help to provides potential unsafe facts which related for the online bank system in the banking industry and the action to handle the situation.

The strength for the approach can handle complex structures in the organization between social and political situation. It is an analysis for business situation to found out a solution using a systematic method. Since the business situation for the banking industry were related into many problems situation in different point of views. The use of SSM will apply because the SSM is design to use in "messy" problems situation.

The weakness for the approach is too difficult to define appropriate structures model in Rich Pictures. The analyst needs to be familiar with the situation in the business sector. Otherwise, it cannot found define the behavior between relations properly or narrow down to a wrong situation. Although the system is cover all the possible activities in real world. The overall approaches can be inaccurate if you define wrong structures. Also, even the problems and solutions were defined in system thinking process. People may have difficulty for interruption in real world. After the debate of changes and actions cause other new problems which need to go back to first step.

Banking Industry

Technological Innovations

Overview of Virtual Banking and Technology Innovation

The key purpose of banking business is to secure of deposits and assets for the customers. Virtual bank is a bank which mainly offering banking services through the Internet. Virtual bank do not offer branches services in order to reduce the operation cost. Different with traditional banking, virtual banking is purely providing their services on the Internet without physical presence. It breaks the geographical limitation for traditional banking. In order to satisfy customer need, virtual bank will provide financial services through ATM and telephone. Virtual bank emphasizes using technology to replace traditional operations.

The objective of using the information technology is to optimize the performance for the business as well as banking operations. Introduce the latest technology innovation below will secure and improve online banking experience.

Applying with SSL on Mobile Banking

Online banking services can be access through computer and also mobile phone using the browser on phone or proprietary clients by the banks. The mobile phone can communicate with the banking platform through GPRS, 3G or WIFI. The SSL is the industrial standard of data encryption which provides encrypted communication to avoid steal of information. As stated in 'CELENT' (2001), by 2010, 35% of online banking households will be using mobile banking, up from less than 1% today.

Fingerprint Recognition

The fingerprint is unique identity for human. The banking client applications with the fingerprint reader can identity exact the account holder. By using password with fingerprint authentication can provider strong authentication. As stated in '' in 2008, The user of biometric technology is becoming widely recognized in the banking industry as a viable mean to prevent identity fraud, safeguard data, improve ease-of use and save money from lost or stolen passwords.

Electronic Help Desk Support

Customers usually feel depress while problems occur during their banking transaction. It is time consuming to describe the symptoms to the customer services. Electronic help desk support can let customer services to take control for the user online session in order to identify the problems effectively. As stated in 'Bnet' (2001), IBM has unveiled the Virtual Help Desk, its new-enabled service design to provide help desks with electronic support for problem inquiries.

Impact of Technological Innovation in Banking Industry

Soft System Methodology (SSM)

SSM is one of system design to solve the non-systematic problems. It mainly use to for the problems which consists lots of social, political and human activity. This distinguishes for the SSM with other methodologies which deal "hard" problems that are more technology-oriented.

SSM applied the system thinking to the real world human organization. At the same time, the system recognizes that the human organization is not a simple system. Therefore, SSM is a very useful way to approach complex situation and corresponding messy questions.

According to the rich pictures, we are assuming such organization structure and the department related with the online banking system in the virtual bank. Even the online banking services delivery efficient and quality services to the customers. On the other side, it also brings concerns for each department in the organization.

The Management concerns the financial as the system required to be well maintenance and enhance the services continuously. The management needs to control the financial properly. Insufficient budget for the maintenance and development will seriously the system stability. It is not only the affected the services and it will be affected the bank reputation as well.

The I.T Department concerns the time since the system need to keep improved and furthermore development to fulfill the market needs. The time frame given may not be enough. The development for each stage and checkpoint must be achieved. The financial product and transactions required complex system design. The system required to pass the acceptance test before launched as the financial data related to customers money. It cannot suffer any systems or applications bugs in banking operation.

As the online banking system do not provide face-to-face contact. Therefore, the first tier communication channels between customers and the bank will be the customer services department. All enquires from the customers will be answer by customer services. If the system performance is poor and instable, the customer services will suffer many complaints from customers.

The branch staffs will concern for the employment since the online banking services take over some of the branch tasks. The management will monitor the number of transactions process in the bank branches. Branches do not handle many transactions which the management will consider close it in order to save the cost.

The user friendly for the system will be the factor for the customer to choose their bank. The customers need to feel comfortable and easy to use for the system. The poor design for the user interfaces and function will cause lots of workload for the customer services since the customers cannot perform the banking services through the system by themselves and keep calling customer services for assistance.

The Government needs to be audit the conduct of the bank and their system. The banks need to be reported to the government for any incident and fault for the banking services in order to protect all the customers deposit in the bank.

As the banking industry was very competitive. Each bank try to offer more supplementary and innovation feature in order to attract more customers.

CATWOE are six components developed by Peter Checkland make well define for the Root Definition. The CATWOE implemented below for online banking system in the banking industry.

Customer represents anyone who obtains benefit or loss in the system. In online banking system, the customers will be the depositors which deposit their money into the bank and make use of the online banking system services. The branches staff will also be the customer because they may have possibility to get lay-off because the number of braches may be reduced in order to save the cost of operation.

Actor represents the one who responsible to perform the input and output activities which define in the system. The online banking system will be operated by the bank itself. The bank will handle their transactions between customers.

Transformation is the process for transforming the input and output. It defined the origination of input and destination for the output. In the online banking system, the input will be the transaction request from customers. The transaction process will be passes through the online banking system to perform their request. The output will be transaction completed. The transformation can also be another financial product like mortgage. The input will be the customer applying mortgage loan though the online banking system. The online banking system will go through steps of analysis process to get to credit rating and personal record about the customer. The output will be the approval of the mortgage.

Weltanschauung is the world-view which the situation brings any impact in the society. It can be either good or bad. The online banking system can improve service quality for the bank. Since the internet do not have geographical limitation. It changes the life style for the customer which they still can use the services anywhere in the world.

Owners represent the one who can get full control for the system. The person should have power to start up and shutdown for the system. The bank will have full control for their online banking system.

Environment will be constraints which required to be considered in the situation. In the customer point of view, the minimum requirements will be the computer knowledge, personal computer and internet access in order to enjoy the services. Those elements are indispensable in the situation.

Conceptual Model represent a simple form activities involved the online banking system in banking industry.

After developing the conceptual model then it returns to the real world and the comparing the model with reality by monitoring the performance and market response. Then ordering questions debate about changes and actions. In the conceptual model for the online banking system, customer open accounts and subscribe online banking services. The online banking services consist of general banking activities which may not satisfy all the customer needs. The bank can monitor the number of customer using the services and number of transaction process by the online banking system can evaluate the performance for the system. Market response and customer feedback can provide suggestions to the bank to improve the services. The bank management and I.T development team can debate about the changes and necessary action to enhance the services since there is no boundary in the system development.

IS Strategic Planning and Development

Macro-Environment Analysis for Virtual Bank (PEST Analysis)

We will demonstrate the cognitive map below with PEST analysis to evaluate the macro-environmental analysis for the online banking system in the banking Industry.


Government Taxation is compulsory for every profitable business. The bank requires pay more tax when more revenues.

Government may offer auditing guideline for the Internet banking which the bank required to follow and achieved the acceptable performance. It is the professional responsibilities for the bank to maintain their system.


The cost for the system development and maintenance are much higher than other business sector. The high demand of system stability and security level are required in order to protect customer assets. Also, those costs are not one-off payment. It requires to keep invest the budget to maintain the system up-to-date.

By offering online banking services, the bank can save the cost for the bank braches and operation cost. It also saves the time for the customer so that they are not necessary to go to the bank branches for their banking services.

The save for the above cost and maintain the equivalent of services levels are the value for the online banking system. It can help to get more profit and less operation expenses.


The banking services delivery on the Internet which can access to everyone. It creates opportunities for unauthorized attempt to the system which have possibilities for the leakage for the customer private information. Fraud banking website also an alternative to obtains customers information. The leakage of privacy not only affects the customers and banking as well as the society. It cause customer lose their confidence to using the online services.


The use of Internet to providing banking services surely a low cost alternative rather than traditional bank branches. Banks trends to further develop and improve the Internet banking services. Although the development cost and maintenance are high but it can reduce cost for branches operation. As a result, the branches scaled down but the services level can be retained.

As the demand of transactions keep increasing and expected of performance for the banking system. The information technology makes customers start to adopt the new practice of banking experience rather than traditional face-to-face services. It also brings revenues for technology solution providers.


Since the online banking system provides banking services online through computer which will be reduced the use of paper. It provides a paperless environment which customer records and receipt will be display through the computer. Thus it can save the cost of paper and printing material.

Micro-Environment Analysis for Virtual Bank (SWOT Analysis)

The information technology changes all business into information based. The emergence of e-commerce already changed our economic panorama. The applied of SWOT analysis aims to examine the objective in business structure. Identify the internal constraints and target opportunities in the market.

The Strengths of Virtual Bank

Secure online banking

By using industrial standard of data encryption can provide secure online customer transaction through the Internet. One time password token with two factor authentication can secure authentication. Providing on-screen keyboard can prevent keyboard logging backdoor.

24x7 Banking Services

The banking system is mainly running on servers cluster providing uninterrupted services for customers. The banking services can be access anytime and anywhere online. 24x7 customer services operation can provide assistance to resolve customer requests.

The Weakness of Virtual Bank

Lack of Human Touch Consultation

The virtual banking purely serve customer using technology which cannot provide face to face contact. It is difficult to handle document work like bank signature. The customer can only access their account information from web interfaces.

Lack of Brand Recognition

Without physical presence in the society, virtual bank may difficult to get an appearance especially elderly whose have difficulty to adopt technology. It can only rely on advertising to increase the market exposure for customer to recognize the brand name.

The Opportunities of Virtual Bank

Adopt Technology for Young Age People

In today most of the young age people are well educated with Internet knowledge. They can easily to adopt new technology. As the population for Internet user keeps rapidly growth which make opportunities for virtual bank to offering more complex financial services online.

The Threats of Virtual Bank

Fraud issues

The human identification recognition such as fingerprint is still not popular techniques in banking industry. The cost will be high for every account holder required fingerprint reader. It make banking system cannot proof the exact account holder who access the banking services. Illegal activities such as identity stealing and phishing still cannot be total prevent. The security concern stills the major threat for the online banking system.

The Impact of Virtual Banking (Porter's Five Forces Model)

The applied for the Porter's five forces assist to determine the constraints, rivalry and forces of organization in order to sustain the competitive advantage in the market. Most of the banks initialized to adopt the latest technology and it becomes the key success factor for the business.

Entry Barriers

The financial constraint was one of the barriers for the virtual banks. In order to maintain the system facilities and it required large amount of operation expenses. The bank need to keep invest and upgrade the latest technology to provide stability services to the customer. Poor performance and system failure will impact the trust and loyalty from the customer definitely.

Supplier Bargaining Power

Since banking system handle sensitive information for the customers and security concern. Most of the banks manage their in-house development team for the system development. The technology providers like hardware vendor and ISPs become key essential for the banks. The cost and quality of the services delivered will directly affected the quality of banking services. The proprietary technology like fingerprint authentication could gain more bargaining power since the bank will not developed by their own.

Consumer Bargaining Power

The transaction cost and services charges would be the bargaining power for the consumer. The deposit interest rate and quality of services using technology are the key factors for consumer for the choice of bank. The technology can ensure the security of authentications and transactions.

Competitive Rivalry for Virtual Banking

Competitions in banking industry are mainly focus on quality services and communication channels available. The use of latest technology can offer quality services in order to attract customers. The advertising can improve the reputation for the bank. Communication campaigns such as email and banner advertising will assist the exposure the assistance on the Internet.

Consequences Analysis for Virtual Bank

Impact on IS Strategic Planning

The banking organization delivery the services which can gain benefits but it still have chances for failure. The consequences for failure will impact the relationship between the bank and customers. The bank required to define safe guard to minimize the risk of failure. There are three types of actions can minimize the risk of failure. Preventive action will be low cost because the failure already estimated and apply appropriate actions. Detective actions will be higher cost than preventive because the failure cannot be predict but it can be monitor and detected. Corrective action will be most expensive the failure already occur and affected the business. It takes more cost to resolve the failure and affected parties.

4.1.1 Effect / Probability / Action Grid

The grid below described the possibilities threats which will occur on the online banking system and discuss about the action in order to minimize the risk.

Threat 1: Possible and Fatal

The complex design of the online banking system consist of large amount of computer servers, network equipments and data center facilities to maintain the operation. It causes possible concerns of the system stability and security issues. The failure of one of the involved component can cause interruption for the services. Also, illegal attempt and network attack which are unpreventable in the Internet world. Unpredictable natural disaster such as fire and earth quake can be serious damage the system.

Action 1

The main objective of the system operation is to prevent services interruption. To avoid system interruption, the system design must be stable. It must providing redundancy or failover for each of major components. Single point of failure is not allowed in the system design. The hardware vendor and internet service provider which must agree the service level and response time for any hardware replacement and services outage. Routine task like monitoring system performance and data backup should be perform in regular basis according to the official operation guidelines and procedures. Also, the operation of banking system should not be relied on a single location. It should be distributed in different location to avoid natural disaster.

Threat 2: Unlikely and Slightly Negative

The poor design for customer user interface for the banking system will decrease the efficiencies for the banking operations. Even the user interfaces can fulfill all the functions but if it is difficult to use such as many steps and lack of help information. It will decrease the usage for the customer to use the system. Since all the customers have variant in computer knowledge. The difficult of understand for the online help information which is hard for customer to use the system.

Action 2

The development which must be use the point of view for customer to design the user interfaces. The graphical user interfaces for the system must be clean and simple. The online help information must contain all the functions in a simple way. Video tutorial will be helpful can assist customer who have difficulty to read. Customer can also get assistance via telephone and email through customer services.

Threat 3: Unlikely and Fatal

The application for the online banking system are developed by programming language, development tools and databases servers. The team of system analysts and programmers will participate in the application development since it involved many functions. The modular design of the system divided all the function into independent modules for development. Since it involve lots of human work and it will have application bug.

Action 3

The application bugs are prohibited in system design and application development especially in banking industry. Inaccurate banking transactions cause losses of customer and reputation. Therefore, the system development team should take serious control in the development stage. It can appoint authorized system audit firm to clarify the accuracy and efficiency of the application. User acceptance test and quality assurance test can sure the input and output process can achieve all the system requirements and functions.

Threat 4: Negligible and Slightly Negative

Although the system are automate most of the banking operation but it still required human to operate it. As the staffs are performing repetition duties everyday and it create chances for human mistakes. Human errors are not easy found out usually. It takes time for the investigation to chase the root causes.

Action 4

Human error prevention can ensure quality and enhance the productivity. The bank cannot guarantee all the staffs can be familiar with the operation of the system. Therefore, the bank must enforce their staffs to attend the user training to ensure the staffs can accomplish the standard. Operational handbook should provide to the staffs for their references. The banking system should also define the priority in the banking system. The important transactions such as large amount in single transaction should get approval by the supervisor in the system.

Ethical Issues for Virtual Bank

Failure Consequences

The online banking system is design to let the customer handle and banking transactions and other financial product on the Internet. The common failure such as software application error, hardware and network out of services may result services interruption will cause the leakage of information. The data for the customers for the bank is important since it may contain the access information which can control the bank account. The privacy information disclosure is one of the major failure consequences for the online banking system.

Human mistakes by bank staff will also cause privacy information disclosure such as loss of portable memory like USB memory stick and memory card. The portable memory can used by bank staff to store customer information retrieve from the system. It may contain sensitive customer information not allow to be disclose. Although the portable memories are commonly use storage media with small size and large memory. It is very easy to lose since the size is too small.

Professional Codes of Conduct

The development of the application in the online banking systems will manipulate the privacy information from customer such as account number, transaction records, bank balance, authorization identity and password. The bank has responsibilities to protect the data in a secure way. The bank staffs have the rights to access to the information. On the other hand, it can also steal the information for improper use.

Data Accessibility

The data accessibility for the bank system should be reasonably control. It should provide different level of priority control for the bank staff in operation. The system design should provide security level for avoid illegal activities such as steal of data, misuse of bank customer information for transaction, fraud of credit s card and other financial products. The banking activities which involve large amount of money should get approval by staff and supervisor. Because the banking transactions are performing over the Internet and the banking system side will have difficulty to identify the exact identity for the customer. Therefore, the large amount of money transaction requested by customer should inform customer for approval. The banking system can offer short message acknowledgement to the customer mobile or phone call to verify the accessibility.

IS Planning Issues

Conclusion of IS Planning

The IS planning should be consider for banking organization to establish a new segment of services. Since the technology services cannot be totally adopted by the society and it cause more than one problems. Sometimes the problems are not related in different entities. The implementation of SSM can assist to identify the problems in the systematic way. For the strategic planning, if bank do not understand the macro and micro environment then it is required to define the advantages and constraints to define the strategy. The organization without strategies will affect the profit and performance definitely.


Online banking will become the primary way for banking activities since it do not time and geographic limitation. By using the bank application online can let customer to manage their banking services instead of travelling to the bank branches. The bank branches should not be totally replaced since customer may not be able to Internet access and not enough computer knowledge to handle it.

Once the development of human identification technologies are getting more mature and widely used in social life. It can lower the security risk for the bank transaction on the Internet. The trends for the world business and banking industry are going toward electronic money and virtual cash. Therefore, the online system is the right time to be deployed and ready for the cashless world.


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