Point of Sale (POS) System Security

The assignment delves into the security challenges associated with Point-of-Sale (POS) systems. It examines various types of vulnerabilities that POS systems can face, including malware attacks, data breaches, and unauthorized access. The assignment also explores the potential consequences of these security threats, such as financial losses, reputational damage, and customer privacy violations. Furthermore, it discusses strategies for securing POS systems, encompassing measures like encryption, access control, intrusion detection, and employee training.

Running head: IT FOR BUSINESS
IT for Business
Name of the Student
Name of the University
Author’s note

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Executive Summary
The main objective of this report is to analyse the case study of a small business, Four Seasons
Greenhouse and Nursery and get an insight into the new POS system implemented by the
nursery. Manual data recording and tracking process was bringing loss to the business. The POS
system could resolve the issues of the business. This report depicts how POS system helped in
effectively operating and managing the business of Four Seasons Greenhouse and Nursery. This
report shows the importance of a POS system. It also recommends appropriate
telecommunication options such as WAN and Wi-fi for the POS system. This report also focuses
on the confidentiality, privacy and security risks brought by the POS system. It suggests effective
measures for preventing the risks.

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Table of Contents
Introduction......................................................................................................................................3
1. Advantages and Disadvantages of the POS system.....................................................................3
2. Competitive advantages of the Business.....................................................................................4
3. Advantages of a Centralised Database........................................................................................5
4. Role of POS system in Decision Making....................................................................................6
5. Telecommunication Options........................................................................................................7
6. Risks that the POS System bring to the Business........................................................................7
Conclusion.......................................................................................................................................8
Recommendations............................................................................................................................8
References........................................................................................................................................9
Bibliography..................................................................................................................................11
Appendices....................................................................................................................................12
Appendix 1.................................................................................................................................12
Appendix 2.................................................................................................................................13
Appendix 3.................................................................................................................................14

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Introduction
POS systems can be considered to be a combination of software as well as hardware that
enables organizations to automate the process of data recording and distributing (Refer to
Appendix 1). It helps in simplifying the daily operations of a business. Four Seasons Greenhouse
and Nursery, a small business based in Colorado adopted a new POS system in the year 2008.
The POS system helped enhance the business operations of the nursery.
This report focuses on the case study of Four Seasons Greenhouse and Nursery and
describes the benefits and disadvantages of the POS system. It also shows how POS system
facilitates the business to gain competitive advantage and enhance the decision making process.
It recommends telecommunication options for the nursery and discusses the various risks that
POS brings to the organization. It also suggests methods for protecting the business against the
various risks.
1. Advantages and Disadvantages of the POS system
The new POS system builds a strong infrastructure for processing and reporting business
operations. The advantages of the new point-of-sale or POS system are:
1) The new POS system enables immediate and real-time tracking of business and sales
data by eliminating the process of manual data tracking (Refer to Appendix 2). Therefore, it
makes sales tracking process simpler and increases the accuracy of data.
2) The new POS system automatically updates the inventory and compiles the sales
history. It helps in reducing the number of inventory units and saves business cost.

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3) It is an advanced version of the traditional cash register that simplifies the process of
accounting. The new POS system increases the accuracy of financial data by providing detailed
cost records. It reduces the occurrence of errors in the financial data.
4) The new POS system facilitates the decision making process of an organization by
enabling the business personnel to easily track past transactions and inventory data. Therefore,
the business and operational efficiency of an organization can be increased by adopting a POS
system.
5) It helps in tracking the employee schedules and allocating labour expenses without any
error. The new POS system also helps in maintaining price consistency of the products. The level
of customer and employee satisfaction can be enhanced by using a POS system.
The disadvantages of the new point-of-sale or POS system are:
1) Implementation of the new POS system is a costly process as the initial setup cost is
high. It needs regular maintenance and software updates which add to the expense of the
business.
2) Security risk of a POS system is a demerit of this system. There are possibilities of
security breaches due to incorrect software update or in cases when the system is not up-to-date.
Theft of sensitive data from the POS system can put the organization at financial and legal risk.
2. Competitive advantages of the Business
The new POS system will help the business to gain competitive advantage in the market.
It will help in generating detailed and accurate sales reports which will facilitate the business
personnel to appropriately analyse the sales data in various ways based on the number of items

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sold, promotions and time periods (Peppard and Ward 2016). It will help in making better
business decisions and enhance the revenue of the organization. The POS system will help to
accurately manage the inventory data and provide detailed information about the inventory
items. It will help in pricing the products accurately for generating more profit. The accurate and
error free reports generated by the POS system will help in effective decision making and growth
of the business (Refer to Appendix 2). The POS system will help to simplify the process of
recording, tracking as well as distributing data for effectively managing and operating the
business. With the elimination of manual processes, errors in the financial data will also get
eliminated. The POS system will also help in retaining and managing the employees. It will help
in attracting more customers to the business. Therefore, the new POS system will be able to help
Four Seasons Greenhouse and Nursery to gain competitive advantages.
3. Advantages of a Centralised Database
1) Centralised database has a redundant storage and fault-tolerant setup that helps in
preserving data, even when there is hardware failure (Laudon and Laudon 2016).
2) Centralised database prevents physical access to specific locations by storing data in a
centralised location (Coronel and Morris 2016). It enhances the physical security of data.
3) The presence of various data access and security policies in a centralised database
helps in improving the data security by preventing unauthorized access and data manipulation.
4) Centralised database enables the organization to cut the overall business cost as the
maintenance cost of a central server is much less than the maintenance cost of multiple
computers (Gouhar 2017). It also reduces the space requirements for storing and processing data.

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5) Centralised database facilitates the business to access data from any location. It
provides high-quality and non-redundant data. Hence it is considered to be more reliable as
compared to local storage.
4. Role of POS system in Decision Making
The new POS system could facilitate the decision making process in Four Seasons
Greenhouse and Nursery. The POS system could automatically record, track and distribute
financial, inventory and sales data accurately. It could process business activities more
effectively by eliminating the process of manual data tracking and save time. Accurate and error-
free inventory data that are maintained by the new POS system could help the business to make
effective decisions (Yang and Hwang 2015). POS system could make the business processes and
activities more effective as decisions regarding production or order of the number of product
units were not based on assumptions and speculations.
Manual tracking of data or information cannot be done in an effective manner. Manual
tracking involves human intervention which can lead to errors (Moon, Kim and Ham 2014). The
new POS system could enhance the data accuracy by generating and maintaining error-free sales
and inventory reports.
The POS system could provide accurate details regarding the inventory counts. Hence it
could provide answers to questions such as how many products were sold, discarded and
purchased (Refer to Appendix 2).
The accurate and detailed information regarding cost reporting could help the business to
effectively price their products for generating more profit. The timely as well as accurate

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reporting of information could help business personnel to effectively manage business
operations.
5. Telecommunication Options
Four Seasons Greenhouse and Nursery can benefit by selecting WAN or Wireless Area
Network for the new POS system (Refer to Appendix 3). WAN will help in centralising the IT
infrastructure and simplifying the process of server management. It will help the business to
increase its bandwidth and eliminate the need of ISDN leading to the reduction of extra costs.
Wireless technologies will be suitable for the POS system of Four Seasons Greenhouse
and Nursery. Wireless technologies will increase mobility, improve responsiveness and provide
better access to information (Iniewski 2017). It will help the business to easily expand. Wi-Fi
technology will be suitable for Four Seasons Greenhouse and Nursery as it will help the
employees to easily remain connected and increase productivity (Challoo et al. 2012). It will
save the heavy cost of installation process that is required in wired technologies.
6. Risks that the POS System bring to the Business
1. Security risks: If there is loophole in the network then hackers can steal the sensitive
business data (Stallings et al. 2012). If the software is not regularly updated then it can lead to
security risks. To overcome the security risks the network need to be protected with encrypted
passwords and update the software on a regular basis (Peltier 2013).
2. Privacy risks: Malicious software such as ransomware and spyware can secretly steal
the sensitive data from the POS system and harm the business (Saeed, Selamat and Abuagoub
2013). An advanced version of anti-virus software must be installed to prevent privacy risks.

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3. Confidentiality risks: Lack of authorization in the POS system of Four Seasons
Greenhouse and Nursery will lead to confidentiality issues (Kaiser 2012). A risk management
plan must be developed and authorization levels must be enforced for preventing confidentiality
risks.
Conclusion
This report concludes that the new POS system prove to be beneficial for Four Seasons
Greenhouse and Nursery. The POS will help the business to attain competitive advantages by
automating the process of data recording, distributing and tracking. This report mentioned some
of the benefits such as increased operational efficiency and elimination of manual processes. It
suggested WAN and Wi-fi technology to be the most suitable telecommunication options for the
POS system of Four Seasons Greenhouse and Nursery. It said that security, privacy and
confidentiality risks of the POS system can be prevented by securing the network, using anti-
virus programs and enforcing authorization levels respectively.
Recommendations
1. Security measures must be taken into account while implementing the POS system.
2. Regular maintenance of the POS system must be carried out for proper functioning of
the system.
3. The network must be protected with strong security policies and updated version of
anti-virus programs must be installed for preventing business risks.

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References
Challoo, R., Oladeinde, A., Yilmazer, N., Ozcelik, S. and Challoo, L., 2012. An overview and
assessment of wireless technologies and co-existence of ZigBee, Bluetooth and Wi-Fi
devices. Procedia Computer Science, 12, pp.386-391.
Coronel, C. and Morris, S., 2016. Database systems: design, implementation, & management.
Cengage Learning.
Gouhar, A., 2017. Database Management System. International Journal of Engineering
Science, 11766.
Iniewski, K. ed., 2017. Wireless technologies: circuits, systems, and devices. CRC press.
Kaiser, K., 2012. Protecting confidentiality. The Sage handbook of interview research, pp.457-
464.
Laudon, K.C. and Laudon, J.P., 2016. Management information system. Pearson Education
India.
Moon, Y.J., Kim, W. and Ham, S., 2014. Users' intentions to employ a Point-Of-Sale
system. The Service Industries Journal, 34(11), pp.901-921.
Peltier, T.R., 2013. Information security fundamentals. CRC Press.
Peppard, J. and Ward, J., 2016. The strategic management of information systems: Building a
digital strategy. John Wiley & Sons.

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Saeed, I.A., Selamat, A. and Abuagoub, A.M., 2013. A survey on malware and malware
detection systems. International Journal of Computer Applications, 67(16).
Stallings, W., Brown, L., Bauer, M.D. and Bhattacharjee, A.K., 2012. Computer security:
principles and practice (pp. 978-0). Pearson Education.
Yang, D. and Hwang, I., 2015, May. Security enhancement methods for mobile POS system.
In Proceedings of the Second ACM International Conference on Mobile Software Engineering
and Systems (pp. 152-153). IEEE Press.

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Bibliography
Romney, M.B. and Steinbart, P.J., 2012. Accounting information systems. Boston: Pearson.
Stair, R. and Reynolds, G., 2013. Principles of information systems. Cengage Learning
Zissis, D. and Lekkas, D., 2012. Addressing cloud computing security issues. Future Generation
computer systems, 28(3), pp.583-592.

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Appendices
Appendix 1
About POS System
Inventory software programs now on the market let you track usage, monitor changes in
unit dollar costs, calculate when you need to reorder, and analyze inventory levels on an item-by-
item basis. You can even control inventory right at the cash register with point-of-sale (POS)
software systems. POS software records each sale when it happens, so your inventory records are
always up-to-date. Better still, you get much more information about the sale than you could
gather with a manual system. By running reports based on this information, you can make better
decisions about ordering and merchandising.
With a POS system:
 You can analyze sales data, figure out how well all the items on your shelves sell,
and adjust purchasing levels accordingly.
 You can maintain a sales history to help adjust your buying decisions for seasonal
purchasing trends.
 You can improve pricing accuracy by integrating bar-code scanners and credit
card authorization ability with the POS system.

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Appendix 2
Case Study

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Appendix 3
WAN
A wide area network (WAN) is a geographically distributed private
telecommunications network that interconnects multiple local area networks (LANs). In an
enterprise, a WAN may consist of connections to a company's headquarters, branch

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offices, collocation facilities, cloud services and other facilities. Typically, a router or other
multifunction device is used to connect a LAN to a WAN. Enterprise WANs allow users to share
access to applications, services and other centrally located resources.