M2: Analyse the legal, ethical and operational issues in relation to the use of business information using appropriate examples

This task consists of analysing legal, ethical and operational issues related to the use of business information using various examples. This report also requires me to consider the advantages and disadvantages of legal, ethical and operational issues that SFX may need to consider in their use of business information.

The relevant acts were designed to control the use business information through various provisions. These provisions ensure that personal information held by the organisation is protected. SFX has information on students which are obtained fairly and legally in accordance with the Data Protection Act 1998. This act also states that information obtained should be up to date and accurate. If information is inaccurate, it should be corrected as soon as possible. If SFX do not amend this error, it can become liable to prosecution. It is unethical and unlawful to create, save and share incorrect information that violates the provisions of the Data Protection Act 1998.

Businesses must ensure that all business information is protected from being misused by anyone who has/can gain access to the information. The Data Protection Act states that businesses must have a secure storage area for information obtained by the business such as transactions, personal details of staff, bank account details and any other information that is relevant to the business. In the same way, businesses must ensure as part of operational issues the information generated through business transactions are secured from being hacked into. Using SFX as an example, the bank details of staff or college accounts should be protected from fraudsters. All these types of information relating to transactions of activity should be secured in a backup facility that ensures the information is safe so that any unauthorised intrusion can be prevented. This enables operational activities to continue without disruption. SFX has a backup facility which prevents unauthorised access to college records. Without such essential facilities, it is possible that student’s information would be lost to unwelcome individuals.

There are other operational issues which SFX needs to consider while using business information such as the issue of health and safety. The college has made extensive efforts to ensure all emergency exits are sign posted and fire action posters are placed in emergency exit zones. Also there is access to lifts for those who are disabled, as well has ramps to enable those disabled to enter the building. Apart from operational issues, there are also legal and ethical issues as well as related advantages and disadvantages.

Having considered the various relevant issues regarding the use of business information, it is important to point out that there are some built in advantages of all the acts mentioned above. The most important advantage of all these acts is that all companies are bound by the same law and as such are expected to follow the same structure. Most businesses and their stakeholders are also guaranteed legal protection if they follow the law.

However there are also disadvantages of these acts. For instance, if SFX fails to obey the law regarding the use of business information, then the business is liable to prosecution. Abiding by these laws can also be expensive, particularly because trying to install adequate backup facilities can be an expensive project to undertake.
Failure to abide by the law and the subsequent fine may lead to company closures on the order of the law courts. It is also questionable how to enforce this law if the offence is committed away from the UK especially if the victims are individuals. Equally businesses or organisations like SFX may find sudden provisions of the law regarding the use of business information expensive to implement. For example, the freedom of information act requires public authorities to provide or requests business information freely. However where the request is in large volumes, it can be expensive for organisations like SFX.

There are organisations that use ethical behaviour within their organisation. The use of ethical behaviour brings advantages internally. One of the advantages is that the ethical behaviour brings in higher revenues for those profit making organisations. Also it improves the brand of the organisation and creates awareness of the business and builds recognition. SFX’s ethical behaviour has proved this because when the public sees the ‘SFX’ brand, they immediately know that SFX is a good college. Ethical behaviour also builds a sense of motivation within the organisation therefore creating better employees. The use of ethical behaviour brings in more external involvement into the organisation such as ethical investors. This is a new source of finance.

However, there are disadvantages to having an ethical behaviour within the organisation. The disadvantages to operating ethically are that even though it brings higher revenues, it has a higher cost. Also there would be a higher demand of training needed to be given to employees in order for them to know the ethical policy. Also the uses of ethical behaviour can create false expectation.

In conclusion, I am of the opinion that the various legislations regarding the use of business information does provide adequate protection for individuals and organisations such as SFX. However it does raise a major question which is the issue of worldwide enforcement which I think will never be possible. Indeed there are useful aspects of the act as far as UK’s concern it does work.