Does It Pay Off
Compare/ assess HSBC and Citi-corps IT strategies. Do they invest in IT primarily as a way of cutting costs and improving their operational efficiencies, or do they invest strategically with a view to entrench their competitive positions?
As noted in the conclusion of the article written by the Asia Case Research Center and the University of Hong Kong HCBC and Citigroup have both developed into global financial institutions. Both organizations have heavily invested in Information Technology and, as is self-reported in both companies’ financial statements, both are committed to using IT to gain a competitive advantage. That is where the similarities end. When we examine the details it is obvious that although both firms have heavily invested in IT advancements the types of projects and overall approach are very different.
Let us first look at HSBC. The Hong Kong and Shanghai Banking Corporation was founded by Thomas Southerland in 1865 with branches in London Shanghai, and San Francisco. By the year 2007 the company had grown to have 9500 offices, 200,000 shareholders, 310,000 employees and over 125 million customers spanning 76 countries.
HSBC built their business based on the philosophy of managing for value from 1998 through 2003 with the objective of providing a satisfactory return on shareholder capital. One of the primary ways HSBC attempted to accomplish this strategy was through its approach to leveraging technology.
An example of the company’s technology strategy is found in a statement which was part of the company’s 1996 annual report. In this report the company described its IT policy as a strategy based on harnessing the power of new technology to provide new and better services for their customers while simultaneously improving the banks operational efficiencies. Then stated the challenge they saw as a global financial services organization factored highly around their ability to link different parts of the group more closely together.
As noted in the conclusion of the article written by the Asia Case Research Center and the University of Hong Kong HCBC and Citigroup have both developed into global financial institutions. Both organizations have heavily invested in Information Technology and, as is self-reported in both companies’ financial statements, both are committed to using IT to gain a competitive advantage. That is where the similarities end. When we examine the details it is obvious that although both firms have heavily invested in IT advancements the types of projects and overall approach are very different.
Let us first look at HSBC. The Hong Kong and Shanghai Banking Corporation was founded by Thomas Southerland in 1865 with branches in London Shanghai, and San Francisco. By the year 2007 the company had grown to have 9500 offices, 200,000 shareholders, 310,000 employees and over 125 million customers spanning 76 countries.
HSBC built their business based on the philosophy of managing for value from 1998 through 2003 with the objective of providing a satisfactory return on shareholder capital. One of the primary ways HSBC attempted to accomplish this strategy was through its approach to leveraging technology.
An example of the company’s technology strategy is found in a statement which was part of the company’s 1996 annual report. In this report the company described its IT policy as a strategy based on harnessing the power of new technology to provide new and better services for their customers while simultaneously improving the banks operational efficiencies. Then stated the challenge they saw as a global financial services organization factored highly around their ability to link different parts of the group more closely together.