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Hong Kong Exchanges and Clearing Ltd: IT Usage

Competitive Environment

The emergence of information technology business solutions has enabled Hong Kong Exchanges and Clearing Limited (HKEx) to be one of the best companies in Hong Kong offering financial services. As a financial services-based company, there is, therefore, a need to understand the company’s business processes and come up will an amicable solution to the entire operations of the company (Robson, 2007). The corporate management has discussed the emerging issues and after finding the weakness of the overall operation noticed with great concern that information technology infrastructure and enterprise resource planning, in particular, would offer the following competitive edge if implemented. First, the creation of new markets and services through the use of technology is one of the key competitive environments that forced Hong Kong Exchanges and Clearing Limited (HKEx) to change its information technology infrastructure so that it can be in a position to access a larger market. To this company, it means that this kind of system can attract more consumers or clients because they can also access the products and services information and therefore make a smart decision (Robson, 2007). What is emphasized here is the ability to reach many clients using complicated information systems known as enterprise resource planning.

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The other competitive environment that lead to Hong Kong Exchanges and Clearing Limited (HKEx) changing its information technology infrastructure is the increased speed of transactions. This is because enterprise resource planning integrates the entire business units’ data into a single database that enables faster accessibility of data, synchronization, data integrity availability, and accountability. It is, therefore, faster to do transactions since data is not contained in different databases. There is still another competitive environment that cannot be understated which is widening the market geographically (Kelly, 2007). This is so because, with enterprise resource planning, it is possible for any company to handle a large amount of data and also execute business transactions very fast. The creation of a twenty-four-hour economy is also another competitive environment that information technology infrastructure has enabled the company under consideration to do. This means increased volume sales and also profits (Kelly, 2007). Others include transfer to a global player and the ability to improve the range of products. It is evident that proper implementation of enterprise resource planning gave the best results to this company due to the increased performance and also increased volume of sales.

Changes to the HKEx’s IT infrastructure

It is worth mentioning that the changes as they will be summarized here in this document and this question, in particular, contributed to the advancement of the services and products that Hong Kong Exchanges and Clearing Limited (HKEx) offer to its clients (Laurie, 2007).

One of the changes that were made is the adoption of current technology in Nortel Networks Internet protocol. This made it possible to relay or transmit data at a higher speed, increased throughput, and high bandwidth experienced. This put the company on a better competitive edge than the competitors who had not implemented this technology. Implementation of information technology solutions always triggers many changes in any one company and comes with a cost but many benefits. This was done also to maximize availability, efficiency, and also provision for future expansion room. The other change is the launch of depository receipts (Davidson, 2009). This is also another milestone that the information system can achieve if implemented properly to be used in running Hong Kong Exchanges and Clearing Limited (HKEx) day-to-day operation.

When implementing enterprise resource planning, we can’t leave unmentioned the fact that many changes take effect on the way the business processes are conducted. To begin with, this company had to integrate every system in each department into a single system encompassing all the modules (Davidson, 2009). This assisted the workers to access the information of the entire department with a click of the mouse rather than making a call to the other department to make a confirmation of a particular issue. How the employers worked initially also changed. This means that if the order information was entered in the computer in each department, with an enterprise resource planning this change since one needs to enter that information only once and then it is available in real-time to each department. This brought about sharing of the information

Level 0 context diagram and a Level 1 data flow Diagram
Level 0 context diagram and a Level 1 data flow Diagram.
Level 1 DFD Diagram
Level 1 DFD Diagram.

Effectiveness of the development strategy and project management

In any project management, there is a requirement that the process should be led or conducted by competent personnel to ensure successful delivery of quality system and also deliver it on time.AMS/3 was developed by internal parties and the sole reason was that this group had a good understanding of the Hong Kong Exchanges and Clearing Limited (HKEx) business processes. This would assist the external parties who are considered experts in developing enterprise resource planning. The final system of this kind takes a lot of time to finish and every system cannot be error-free. It is therefore the responsibility of the project manager to ensure all the factors are taken into consideration when assigning financial, material, and human resources.

It is always advisable to make sure as a project manager that there is a qualified and reliable technical team before starting the work of developing enterprise resource planning. All the stakeholders should be consulted early in advance to make sure that all the stakeholders strike a mutual consensus to avoid differences in opinion when the project has already kicked off since this would bring about losses to the company (Holden, 2003). Hong Kong Exchanges and Clearing Limited (HKEx) corporate management made sure that the finance was not a problem throughout this exercise. If this was not taken care of it would have delayed this exercise hence putting the company at a greater risk. Project management requires that the project manager together with all the other stakeholders break down that project into phases or tasks or even activities to enable proper scheduling of all those activities. Scheduling means that one must determine which activities are most important and which should precede others. In project management, it is worth noting that most are the times when the results of one activity become the input of the incoming or the next activity. This had been taken care of since at the end of the second year everything was intact and ready to go.

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Reasons for carrying out testing

Software developers are required to test the system every time they have finished developing or maintaining a system. This is what Hong Kong Exchanges and Clearing Limited (HKEx) developers did to their system when it was done. Numerous reasons lead to this decision including but not limited to determining if the system delivers the user requirements or functionalities and to determine if the system breaches any ethical issues (Holden, 2003). This is so because information technology professionals have a code of professional ethics that they should adhere to while developing the systems. It is always required that while doing a test to a software or a computer-based application it is always advisable that the test be done by an independent person. This means that the person who developed the system should not test that system, but a third party should do it.

There several types of testing that were done and they are system testing and unit testing. The system testing was done to determine the credibility of the entire system (Holden, 2003). A thing of interest here includes checking if determining if the whole system is functioning properly and also the interaction of the individual modules. Unit testing checks the credibility of an individual module. This means if an individual module is functioning properly the unit or module testing has passed. Hong Kong Exchanges and Clearing Limited (HKEx) system was also tested to validate the fields and also the database data types. This means that if a field was meant to accept only numerical or integer values, there is no single time it should accept strings or any other data type otherwise it generates an error or generates a message telling the user where he or she has gone wrong.

Technical and business reasons for implementation strategy

Before answering this question let us first all list down all the possible approaches to implementation that Hong Kong Exchanges and Clearing Limited (HKEx) would have considered before rolling out the AMS/3 system namely parallel implementation, pilot implementation, and direct implementation (Capron, 2006). The technical reason for this implementation is that they considered that there would be problems if they tried to implement the system directly. The problem would arise as a result of those modules interfacing with each other and this would require an expert to implement it. Another thing is that if a parallel implementation is done it can lead a company to losses since most of the workers are familiarizing themselves with the new system. This is a business reason since it would have affected the business significantly (Holden, 2003).

The other technical reason for this lengthy implementation is the requirement of expensive technology that was not readily available and therefore they had to be patient until all devices required like networking devices were availed. On the business side, there is always resistance to change by top management and this could have delayed the whole process significantly. Lack of reaching a mutual consensus on what type of programming language to use when it comes to implementation of the whole system may have led to the delayed implementation since some of the stakeholders could be thinking of using a different programming language which the other group does not want or that would not support interoperability which is a key factor to consider while deploying an enterprise resource planning. The complexity of the business processes that would later be converted or automated using information technology can determine how long the implementation of a system would take but if the business process is not complicated the system would be implemented very fast.

The relationship between the first-generation system and its users, and AMS/3 and its users

The Information technology solutions that existed initially before enterprise resource planning were stand-alone computer systems (Loudon, 2003). This means that each office and or department in an organization had a computer system configured purposely to work or to solve problems of that particular department. Therefore, despite having computers in our offices the business processes were not fully automated since still we experienced a lot of difficulties when processing transactions (Loudon, 2003). This is evident because for instance when processing an order the whole process from the time the order information is manually entered into the computer system until the time the invoice will be made and eventually get revenue, the whole process was partly manual since the customer had to move that order physically from one department to the other (Capron, 2006). This shows clearly that there was nothing like the availability of data. Data existed in a different repository since each computer had its database.

There was a lack of consistency of data in those different repositories. This is how the system that was replaced AMS/3 worked. When enterprise resource planning surfaced it came with a lot of benefits and capabilities. Hong Kong Exchanges and Clearing Limited’s (HKEx) system was based on this ERP. This application integrated all the modules of the entire organization into one big system accessing a single database. This made it easier for the workers of HKEx to work with more consistent data and share the same data (Capron, 2006). AMS/3 had the inter-modules capability. This means that different modules could communicate and share information. For instance, a sales agent would simply query the database to find the volume of inventory hence knowing the volume of inventory instantly. The same system was referred to us as inter-organizational because it was linked with other external systems and could easily communicate even with different platforms (Capron, 2006). This is called interoperability. The users of the latter system are considered businesspeople rather than just data entry clerks.

The most fruitful decision taken by HKEx in using AMS/3 to run its business process is the use of technology to cut down, make market globally, and storage of data in a consistent manner. Faster execution of transactions makes this system more productive. Investing heavily in IT is a major step in every company since information technology is not only a business driver but a pillar of any business and therefore has to be taken seriously (Holden, 2003). The main reason why this system is productive is that it made it much easier to manage risks and enhance the stability of the market.

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Capron, H.L. (2006), Johnson JA, Computers: Tools for an Information Age, 8th Edition. Pearson Education Ltd: London.

Capron, H.L. (2006) – Tools for the Information Age, 8th Edition (2006) Pearson Education. London.

Davidson, A. (2009), Information Systems Development: Methodologies, Techniques and Tools, 4th Edition, McGraw-Hill Higher Education.

Holden, P. (2003), The Complete Course book for Office XP Pearson Education Limited. London.

Kelly, S. (2007), The Definitive Guide to Project Management: The fast track to getting the job done on time and on budget, Prentice Hall. London.

Laurie, J. (2007), Management and Organizational Behavior, 8th Edition Pearson Education: London.

Loudon, K. (2003), Management Information Systems: Managing the Digital Firm Global Edition (11th Edition) (2009), Pearson Education Limited, London.

Robson, W. (2007), Strategic Management and Information Systems: An Integrated Approach, 2nd Edition Prentice Hall. London.

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