Introduction to the Impact of the Internet on Organisations

Think about how businesses used to work fifty years ago. They relied on paper files, physical mail (which took days to arrive), and customers who walked through their front door. Today, the internet has completely transformed the way organisations operate. Whether it is a small local bakery or a massive global company like Amazon, the internet has brought both incredible opportunities and some tricky challenges.

In this chapter, we will explore the positive and negative impacts the internet has on organisations. This is part of Topic 3: Operating Online.

Positive Impacts (The Benefits)

The internet has allowed businesses to work faster, reach more people, and manage their data more effectively. Here are the four main areas you need to know for your exam:

1. Improved Communication

In the past, communicating with a partner in another country meant expensive phone calls or waiting weeks for letters. Now, communication is instant and low-cost. Organisations use:

  • Email: For sending formal messages and documents instantly.
  • Video Conferencing: (Like Zoom or Teams) To hold meetings with people all over the world without traveling.
  • Instant Messaging: For quick internal chats between staff members.

Example: A design team in London can chat in real-time with a factory in China to fix a product design flaw in minutes.

2. Access to Global Markets

The "market" is no longer just the people living in the same town as the business. The internet provides a global market.

  • Any business with a website can sell products to customers anywhere in the world, 24 hours a day, 7 days a week.
  • This is often called E-commerce.

3. Access to a Global Workforce

Organisations are no longer limited to hiring people who live nearby. They can hire the best experts from anywhere on the planet.

  • Remote Working: Staff can work from home (we cover this more in Section 3.3).
  • Specialist Skills: If a company needs a specific type of programmer that they can't find locally, they can hire someone from another country to work digitally.

4. Changes in Information Management

How organisations handle their "stuff" (data) has changed. Instead of rooms full of filing cabinets, they use digital systems.

  • Cloud Storage: Data can be stored online, meaning staff can access it from any device.
  • Big Data: Companies can collect and analyse huge amounts of information about what customers like, helping them make better business decisions.

Quick Review: The positives are all about being faster, wider, and smarter.

Negative Impacts (The Challenges)

While the internet brings many "pro" points, it also creates new "con" points that organisations must manage.

1. Security Issues and Risk of Hacking

Because organisations are connected to the internet, they are "visible" to criminals. Security is now one of the biggest costs for a business.

  • Hacking: Unauthorised people may try to break into the company's network to steal trade secrets or customer data.
  • Data Breaches: If a company loses customer information (like credit card details), they can face huge fines and lose their customers' trust.
  • Malware: Viruses or ransomware can lock a company’s files, bringing all work to a halt.

Note: For more on how they protect themselves, see Section 3.1: Risks to data.

2. Greater Competition

While the internet lets a business sell to the whole world, it also means the whole world can sell to their customers!

  • A small local bookshop isn't just competing with the shop in the next town; they are competing with Amazon and every other online bookstore.
  • This often forces prices down, which is good for customers but can make it very hard for smaller organisations to survive.

Did you know? Some traditional businesses that failed to adapt to the internet, like certain high-street video rental stores or travel agents, have gone out of business because they couldn't compete with online rivals.

Comparison Summary Table

Use this table to help you remember the key points for "Discuss" or "Evaluate" style exam questions.

Feature Positive Impact Negative Impact
Customers Can reach people globally. Must compete with global giants.
Staff Can hire experts from anywhere. Must manage staff in different time zones.
Data Easier to store, share, and search. At risk of being hacked or stolen.
Cost Lower communication and travel costs. High cost of cybersecurity and IT staff.

Common Mistakes to Avoid

  • Don't confuse "Individuals" with "Organisations": If the exam asks about the impact on an organisation, talk about profits, competition, and workforce. Don't talk about people getting lonely or spending too much time on social media (that's the impact on individuals!).
  • Be specific about security: Don't just say "it's unsafe." Use terms like unauthorised access, hacking, or data theft.
  • Remember the "Global" aspect: The internet removes physical borders. Always mention global markets or global workforce in your answers.

Key Takeaway: The internet makes the world a "smaller" place for organisations. This makes it easier to grow (positives) but also means there is nowhere to hide from competitors and hackers (negatives).