Strategic Information System and Business Enterprise

This article discusses the benefits and challenges of implementing strategic information systems in business enterprises. It analyzes Xero's organizational structure, operational problems, system acquisition methods, and control problems. It also explores the development and adoption of accounting software packages, challenges faced by organizations, and possible solutions. The article concludes by emphasizing the importance of strategic information systems in modern business practices.

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Strategic Information System and Business Enterprise
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Strategic Information System and Business Enterprise
\Introduction
Modernization and globalization are the two revolutionary terms that have forced the business
organizations to make changes in their organizational structures and to make the adaption of
contemporary means and mechanisms for operating business. The strategic information system is
one of the contemporary platforms that can be adopted by the business corporations for
executing the business as per the modern era. This system aids the business enterprises on
various grounds such as attainment of desired goals and accomplishments of expected outcomes.
The below-presented analysis has been focused on the
Part 1
The current organizational structure
Xero provides accounting software solution to many organizations in Australia. The company
supports accounting operations for some of the small business. It also promotes businesses by
managing their business-related operations. Xero provides opportunities to the businesses to put
claims and purchase loans. The company is dealing with enterprise, banking, financials and
cloud-based partners. The company has the functional organizational structure that works for the
other organizations to manage their accountability. The company deals in different functional
areas like cloud, IT and others; therefore, it has a functional structure. This type of structure
provides better efficiency in work as there is a team of skilled employees that are grouped
together (Xero, 2017).
Operational Problems
Since the company is dealing with different organizations, they may face issues like delays in
work. Due to operational issues in the software system, the companies face challenges to create a
competitive advantage in the market. The system should be easily accessible to all the users for
achieving better productivity. Some of them are discussed below-
1. Errors in business operations- In some cases due to workload, companies make mistakes
in certain calculation and that is considered as an error. It is the loss to the business itself.
The out-dated version of the accounting software system creates more errors than the
customized one. Xero must use a system which is modified and is capable of handling a

Strategic Information System and Business Enterprise
large amount of information as the data is transferred more often in a day to different
organizations.
2. Inefficiency- due to employee issues inefficiency occurs in work performed for the other
organizations (Liebowitz and Frank, 2016). This led to the loss of productivity and
economic value of Xero. To resolve this issue, the company managers decided to divide
the employees into different departments and provide them training.
3. Team problems- conflicts between team members leads to the interruption in achieving
business goals. It is important for the team members to work with accurate coordination
and collaboration. Team members should be dedicated towards their work and focus on
meeting business goals and objectives.
System Acquisition Method
There are various methods which can be used by business organizations to perform their regular
business operations. It is important to use an effective software system to analyze the current
business status and to improve it (Hunton, McEwen and Wier, 2015). An effective software
system can be used to make business strategies for a better business growth. I will be describing
three software systems and will also describe briefly about the system that is used by the
business organization.
1. Commercial software- One of the biggest examples of commercial software is Microsoft
Windows operating system and MS office which can be purchased from any retail shops.
The commercial software is used by Xero to maintain the records. Microsoft operating
system is used by the company to install useful application programs like desktop
applications to perform business operations. The benefit of the commercial software is
that these can be updated whenever required. There is also functionality in such system
for automatic updates.
2. Custom software- this type of software system runs on a specific hardware only. These
software systems are developed for a company for a specific purpose (Hill, Jones and
Schilling, 2014). Xero is a custom software application which is designed according to
the requirements of users. The entity needs to manage accounts of other organizations
and they require a custom software system.

Strategic Information System and Business Enterprise
3. ERP- this type of system is used for enterprises to perform automated business operations
(Kecmanovic et al., 2014). These are reliable to use and provides better business features
to the users. It enables users to access different types of software applications necessary
for their business. These systems provide data integration to Xero as a large amount of
information is transferred each day. It provides the two-tier structure to manage the front-
end and back-end processes for a business organization like Xero. Due to these features,
The firm uses enterprise resource planning systems for better integration of their business
processes (Jirava and Toseafa, 2017).
System Flowchart
This type of flowchart describes the processes a company uses to sell their products or services
to the customers (Goetsch and Davis, 2014). Benefits of a system flowchart are that it helps to
analyze the business processes, training for new employees and managing sales through the
software application. It is a part of sales procedure which is used by the corporation. The
business organization deals with clients to provide best accounting services. The flowchart for
Xero is as follows:

Strategic Information System and Business Enterprise
This flowchart describes the sales process of Xero when the customer applies for purchasing a
product or service. A customer can give a sales order for the service and can move to complete
the order details. Next process is to choose a delivery option (Galliers and Leidner, 2014). When
the order is confirmed it is shipped to the customer otherwise it is canceled. The sales process
consists of sensitive information as it includes the details of products and the customer details
that have to be confidential to be used by the third party.
Control problems
Implementing ERP systems have some risks to the business which needs to be identified.
Managing software associated risks is a crucial task for an organization (Gelinas & Dull, 2008).
From the technological point of view, risks are involved in the software system when providing
satisfaction to the customers. The business organizations face the problem of unskilled
employees in accessing few of the software and also the lack of quality in the software systems.

Strategic Information System and Business Enterprise
Application complexity-
This control problem is associated with accessing the application programs by the user (Romney
& Steinbart, 2009). A user should be expertise in ERP system to access the software to
effectively perform the business operations. It is because the ERP system consists of complex
application problems which can even lead to loss of important information if accessed in a wrong
manner (Eden, Sedera and Tan, 2014). To minimize this risk, staff training is important for the
employees. Another option is to hire the skilled candidates who can handle the complexities of
application programs (Richardson, Chang & Smith 2014). Decentralization is also an issue when
it comes to accessing the software system.
User experience-
When user accesses the software system, a user needs to have clarity of the application
programs. The software system should be user-friendly and it should be capable of installing
updates whenever required. A system that is operational helps in managing the data which
resolves the issue of user experience (Grabski, Leech and Lu, 2001).
Possible frauds
Generally, frauds are detected in order to provide efficiency in work to the users. The employees
of Xero rely on the ERP system to perform daily business operations (Costa, Ferreira, Bento and
Aparicio, 2016). Therefore, it is essential to analyze the frauds that might occur in the system. To
determine the fraud activities, there are many different frameworks available for the ERP
systems. The login details of a user have to verify to ensure that the system is protected from any
kind of frauds (Islam et al., 2010).
Part 2
Development and adoption of the accounting software packages
The business organization has the vision to provide accounting services to other business
organizations. To manage the information of these organizations, Xero provides accounting
software. This software can be used to manage the costs and other accountability factors. To
develop an effective business strategy, Xero required a software system and implemented ERP

Strategic Information System and Business Enterprise
systems to manage their business operations. The accounting software packages are used by the
business organizations to earn profits with their current business operations (Hall, James 2014).
The development of ERP systems is beneficial for the organizations to receive profits from their
field of business. There is a requirement for a planning model to evaluate the effectiveness of
business strategies (Premkumar and King, 1994).
Xero comprises more than two lakh users of their accounting software. This type of software
systems is demand due to increase in the number of competitors. The company is well positioned
in the marketplace with the standards they include in their services. The company is also in the
winning position with its competitor, MYOB. Company owners believe that there are many
opportunities to strengthen their position in the market and they perform their business activities
very well. Xero deals with the national and international customers from Australia and across the
world. Xero holds 15% of the market share in dealing with National customers in Australia. The
company is rising in the market with the belief of creating innovation for their customers. The
company serves for approximately 10,000 partners which is a good count. The company has also
performed well against its competitors and has earned revenue by 71% (Redrup, 2016).
Leaders in the market and what gives them the competitive advantage
Xero has the skilled staff including a chief executive officer who takes care of the growth and
managing performance of the company. The financial officer who is responsible for managing
operational tasks and focusing on increasing revenues for the company and also the data officer
that covers the product operations and product development for the customers (Chofreh et al.,
2014). Chief partner officer who is responsible for the design, development, and marketing of the
product and the other associated leaders of Xero. These leaders make continuous research to find
out which solution will be best for their customers. When each of the details like finance, overall
expenses, resources required and so on is known to the company officials, it helps in developing
the better strategy for the company. Development of a business strategy involves a gathering of
information regarding each factor discussed above. Leaders of Xero focus on improving their
current business processes by analyzing all the consequences of the business (Xero, 2017).

Strategic Information System and Business Enterprise
Challenges
The accounting software is used by the organizations because it makes the work easier as
compared with the manual work. However, the organization faces some challenges when they
implement any accounting software for their business processes.
 Lack of security- since the company also deal with international organizations, it is more
prone to unknown users. Account related information is very sensitive when it is moved
to someone else’s hand. Therefore, these types of software need to be protected. Using
firewalls is the convenient solution for such an issue.
 Weak reporting service- the purpose of implementing accounting software is to retrieve
the information whenever required. But in most cases, software does not allow users to
get relevant outputs which are annoys most of the customers. Customers need to have
such a system which can store and manage information effectively.
 Lack of efficiency- some of the accounting software systems have poor features which
are the challenge for the customers to access it. The hardware devices and application
programs should work properly (Kecmanovic et al., 2014). In short, the software system
should be user-friendly. The system should be compatible and capable to accept updates.
 Lack of accuracy- most of the accounting software system has become older in terms of
trending technology. Such out-dated systems create inaccuracy of information. A
customer requires a system which can install updates without any risks.
 Technical support- customers need the good response when they ask for an issue. Some
of the consultants are not available 24 hours a day which makes it difficult for the
customers to resolve their issues.
 File storage and organization- it is tough work to find a particular accounting file from
the manual records; therefore, accounting software systems are required for the better
management of files. The accounting software systems help to categorize data in a
sequential manner and makes the work of employees easy (Maduqne, 2013).
Solution
 A company can implement a cloud-based accounting software system. This will help to
store a large amount of information at one place (Alamri, Almutiri, Ballahmar and Zafar,
2016). It is also easy to access the account details and connect with other users.

Strategic Information System and Business Enterprise
 Software system performs hard calculations in a very less time which is the solution to
most of the accountants. Since there is a lot of work to accomplish every day, the system
that could perform fast calculations is required by most of the organizations.
 Multi-function ERP can be used by Xero to make the business operations volatile for its
customers. This will allow a company to perform business operations more effectively
and provide reliability to the customers (IES, 2016).
Recommendation
It can be recommended to Xero to use such ERP systems that could be modified and can easily
install updates. The software system with all the necessary features will make the business
processes Xero more convenient. As described above, a cloud-based system can be implemented.
A cloud-based system allows multiple users to stay connected at a time. This consumes less time
and provides better results for the company. The company should hire skilled candidates to
perform the accounting task easily who have the knowledge to access the modified ERP systems.
Conclusion
In the limelight of the above-executed analysis, it has been identified that the strategic
information system is one of the contemporary means of executing business practices within an
organization and the same will be proven beneficial for the business firm.

Strategic Information System and Business Enterprise
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