Pollution as a Social Problem

¶ … Pollution as a social problem

Mobile Banking in the Banking Business

The fact that we live in a rapidly changing society is no stranger to anyone. The features of the contemporaneous community are numerous, to include issues such as reduced time to handle operations, increased levels of stress and the continuous search for applications that improve living conditions by making the individual work less and increase his gains. The banking business is no stranger to these new demands and, in the context of increasing operators and fiercer competition, financial institutions have developed and implemented a wide series of strategic courses of action that best respond to the modifying needs of their customer palettes. One such application is mobile banking and the aim of this paper is to assess this model of making money.

Analysis of the Industry

The concept of mobile banking reveals a series of advantages that make it competitive relative to other financial solutions in the industry. The application in itself allows bank customers to log on to their account from a mobile device (such as telephone or laptop) and operate payments, transfers and other actions. Income for the bank is generated based on commissions established in accordance with the sums transferred from an account to the other. The main advantage for the bank is that it reduces lines at front desks and increases operational efficiency.

The industry will be assessed with the use of Porter's Five Forces, whilst the strengths of mobile banking, alongside with its limitations and external forces, will be revealed in the following SWOT analysis:

Internal Strengths

wide applications that satisfy the customers who save time and better organize their operations numerous advantages for the banking institution, such as reduced lines at front desks, increased operational efficiency and decreased costs

Internal Weaknesses

requires sustained assistance from a team of IT specialists, which increases organizational expenditure does not address the entire community of customers

External Opportunities

a growing demand for more flexible financial solutions a growing number of people who use computers and have access to internet

External Threats

there are still large numbers of individuals who do not know how to operate computers and who will not find utility in mobile banking rapidly changing technologies that require constant updates and as such further increase operating costs

The industry analysis model of Porter's Five Forces is useful in getting an idea relative to the competition in a respective sector and refers to the following components:

Threat of new entrants -- generically low as not anyone can open a bank; yet, entrepreneurs can become specialized on a niche sector and offer specific financial services, generating competition for the banking institutions

Bargaining power of suppliers -- since the banks do not offer material products and do not work with commodities, the real power of purveyors is reduced; however, there is a threat that the investors might withdraw their capital, which gives them a higher bargaining status

Bargaining power of buyers -- the individual power of the customer is reduced, yet it can constitute a real threat if a customer with many accounts decides to switch to another bank; the corporate customers on the other hand reveal a growing power in their relationship with the financial institutions.

Threat of substitute products -- this is increased not only from other banks, but from non-financial institutions such as large retailers who sell their items on credit, or mutual funds who promise gains on deposits larger than the banks.

Rivalry between competitors -- this is also seen at high levels as the competition in this centuries old industry continues to increase as the potential gains attract new players (Investopedia, 2009).

3. Getting the Machine to Work

In order for the system to work, two necessary requirements must be met. First of all, there is the need for the customer to own a mobile device which he can use in the process. Secondly, there is the need for an adequate informational system within the banking institution that will receive, record and process the requirements that come from the clients. Considering that the functionality requirements have been met, there is the need to ensure that the system is able to satisfy customer demands. In this order of ideas, the banking institution must select the types of services it desires to offer through mobile banking. The most common such applications include the ability to verify the balance in one's account and make transfers to other accounts. Additional applications could be made available to further increase customer satisfaction and these could include information on exchange rates or even the ability to convert one currency into another currency. Rajnish Tiwari and Stephan Buse (2007) mention the existence of three categories of services offered through mobile banking -- mobile accounting, mobile brokerage and mobile financial information services. The authors go on to explaining that while information services can be offered as independent services, accounting and brokerage are always dependent on information and will be offered in combination with the third set of data services.

4. IT and HR Resources

The role of the IT Department is crucial in the final success of the new banking service. The team of IT specialists is in change of a wide array of tasks, the most common ones being the actual development of the software application to link internal informational systems to mobile devices; collect and process information received from these sources or ensure maintenance and continual improvement of the system. It must however be noted that the IT department is in charge exclusively of the technical part of the mobile banking application, and the ultimate success of the system depends on the sustained efforts of other categories of bank employees as well. The financial team must for instance support the creation of a centralized database that contains clear, relevant and easily accessible information on the customers, their accounts, as well as any other financial information that might be required in the process. Then, the IT employees must continually collaborate with the staff members in the marketing department. The role of the later category is to research the market in order to identify new trends, new customer demands and needs that could be satisfied, as well as new strategies implemented by the competition. Through communications with the IT team, the information retrieved will be included in the application to make mobile banking a stronger and more competitive product. All in all, it can be argued that the mobile banking system requires the sustained assistance of all employees in the banking institution.