Deutsche Bank Case Study

Introduction

 Deutsche Bank began its operations in 1870 and had 2425 international branches. Apart from banking, the company offered financial items and services such as retail banking, merger facilities, foreign exchange, and organization allowance strategies. Even though the banking organization offered numerous services under its portfolio and had managed to stay afloat amidst a financial calamity in 2008, it is currently fighting with the corporate changes facing it. Even so, Deutsche covered $7.2 billion to settle complaints from consumers. Their reputation was ruined and they had to pay more than $7.2 billion in penalties (Brice et al., 2007). The challenges facing the bank exposed the internal weakness and the complicated nature of the organization's internal structure. The bank could not resolve most of the problems it was encountering. One of the underlying weakness was attributed to their outdated organization and managerial system, procurement, and mergers, lack of mergers for their corresponding informatics structures and information systems.

Background

Deutsche bank found itself in trouble with American regulators after it failed to meet reporting requests as stipulated in the Commodity Exchange Act and other institutional regulations. Some banking regulation bodies raised complaints in April 2016 after the bank's information reporting system caused an outage which later prohibited the bank from transmitting its compound asset programs for five consecutive days. Deutsche banks ensuing struggles to try and prevent the systematic outage only worsened the situation creating severe challenges for itself. For instance, after the bank attempted to solve the outage, Deutsche bank’s swap information reported past and present consistent challenges about the integrity of specified data sets such as various invalid legal entities elements. In other words, in an attempt to solve a problem they ended up exposing their secrets and illegalities. Apart from incurring expensive costs due to the outage and failing to meet regulatory requirements, the bank found it hard to meet its daily business needs and run its operations without recurring any extra costs (Bank, 2011). Hence, US banking regulatory bodies proved that the lack of an updated information technology system was one of the main reasons the bank failed to provide accurate banking information and this made it hard for them to keep up with regulators. Inadequate information systems played a role in causing the bank's monetary crisis. Since time immemorial banks often failed to unravel intricate financial items under their systems hence failing to narrow down on the actual value and this is the reason they sold themselves short and run their banking organizations to the ground.

Discussions

The Problems Revealed In the Case Study

 One of the main problems brought to light is the failure to install and utilize an up to date information system which would have made it possible to store, organize, and retrieve crucial banking data. The second challenge identified is the inability to create a workable framework to facilitate operative strategies which led to revenue loss and development of numerous problems which they could handle at one go. Banks operate under dynamic conditions and situations, failure for the Deutsche management bank to meet central bank regulations due to the changing dynamics drained the bank's financial coffers, and at the same time, the bank had no reliable assets to lean on (Bull et al., 2011).  Due to the collective impact, other banks limited their lending to Deutsche bank hence the bank found it hard to remain afloat amidst the challenges.

The Role of Information at Deutsch Bank

 Information technology at the bank was pivotal in retaining internal affairs and kept at bay regulatory pressures and consumer expectations. All the challenges at the bank culminated in outdated systems, inefficiency, and decision-making incapability. Consequently, these challenges led to inaccurate information on business matters resulting in poor decision making due to inadequate and inaccurate information. Deutsche bank like any other banking institution relies heavily on information technology systems to manage its financial commercial matters. Generally, information technology systems and frameworks meaningfully safeguard business operations and ensure everything runs smoothly. Failure to update and set up roper channels often leads to unprecedented amounts of trouble. Despite the impactful role information technologies play in banking, the Deutsche bank never bothered to install a proper information technology system network (Ali, Jampanaboyana, & Greybush, 2009). The failure to update its information technology system was due to years of mergers and expansion. When banks merge and buy other financial organizations, they usually did not integrate the information technology system with the acquired company or firm. The costs and expenses needed to integrate, include direction across numerous managerial departments hence the bank left most of its outdated information technology system intact. Thus, the organization expanded its business while leaving an out of date information technology system to cater to the increased workload of each one of their newly acquired business and this is where the bank went completely wrong. This led to a phenomenon known as ‘spaghetti balls’ where various technology strategies fail to meet the expectations of the managerial duties.

 Information technology improves work efficiency and the flow of organizational duties. When a company makes use of information technology mechanisms, they usually define suitable procedures that may lead to upgrading general placement within their market niche.

Information Technology Relating To Decision-Making Competences and Business Administration

 As stated earlier, information technology integrates strategic managerial tasks such as accounting and information storage. This way, the company can give out accurate information and clearly state its performance and communication thus in the end it impacts informed decision making. One common goal of information technology is enhancing organizational duties due to higher processing speed and storage of crucial information. Digitized data handling increases volume, swiftness, usefulness, and capacity hence leading to more output of information-intensive mechanisms (Bull et al., 2011). Harmonized computer systems information software minimizes the processing expenses related to collecting, distributing, evaluating, storage, retrieval of information, and evidence. Affordable charges make market frameworks more appealing hence information technology systems make business actions more economical which affects the internal organizational systems, subcontracting procedures, and other associated activities. In short, the application of information technology impacts each and every action of a company.

Conclusion

 The Deutsche bank extended its business activities through mergers and acquisitions. Even though the company remains successful, its internal operations were strained as the bank did not update its internal operating system hence the system was overwhelmed by the heavy workload. Also, the bank found it hard to release confidential information on regulatory policies and legal documents. Due to poor information storage, the company devalued its assets and this led to the loss of funds that were under its watch. The role of information technology is to digitize consumer information, information processing, and even retrieval of crucial information.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

References

Ali, S. S., Jampanaboyana, L. N., & Greybush, J. J. (2009). U.S. Patent No. 7,558,381. Washington, DC: U.S. Patent and Trademark Office.

Bank, D. (2011). Annual report 2011. Bank XYZ. Jakarta.

Brice, T., Delph, D., Heil, G., Lettovsky, L., & Offutt, J. (2007). U.S. Patent Application No. 11/237,528.

Bull, D. S., Carr Jr, R. N., & Offutt Jr, J. R. (2011). U.S. Patent No. 7,890,652. Washington, DC: U.S. Patent and Trademark Office.