Management Accounting: Strategic Information system

This report focuses on the impact of strategic information system in Desklib. It covers the current organizational structure, operational problems, system acquisition methods, and the role of accounting software packages. Recommendations are also provided to improve the system.

Running head: STRATEGIC INFORMATION SYSTEM
Management Accounting: Strategic Information system
Name off the student:
Name of the university

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Table of Contents
Overview of the report.....................................................................................................................2
Part 1................................................................................................................................................2
1.1 Woolworths Limited: Current organizational structure.........................................................2
1.2 Operational problems experienced by the structure..............................................................3
1.3 Mostly likely system acquisition method..............................................................................5
1.4 System flowchart for the sales procedure for Woolworths Limited......................................6
1.5 Identification of the control problems in the system and the sort of frauds..........................8
Part 2................................................................................................................................................8
2.1 Development and adoption of accounting software packages...............................................8
2.2 The current market size.........................................................................................................9
2.3 Identification of the leaders in the market and their competitive advantages.....................10
2.4 Identification of the current gaps and challenges encountered by the users of the
accounting software package.....................................................................................................11
References......................................................................................................................................13

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Overview of the report
This particular report is focused on the impact of strategic information system in the
nominated business organization Woolworths Limited. It is addressed that with the help of
strategic information system the company will be able to gain effective commercial benefits and
competitive advantages at the same time. The first section of the report defines the current
organizational structure of Woolworths Limited. Besides this the operational issues that are
facing by Woolworths Limited are also determines in this report. In addition to this, the system
acquisition methods in terms of Enterprise Resource Planning (ERP) with a sales flowchart are
also prepared for Woolworths that is expected can minimize the operational errors.
Whereas the second section of the report defines the role of accounting software package
in a business organization. It also defines the way through which an accounting software package
can be adopted and developed in the business organization. For this particular report the
nominated accounting software package is XERO. How XERO can minimize the issues of
traditional data management system are also illustrated in this report. The current market leaders
and the feedback from the users are also demonstrated in this report.
Part 1
1.1 Woolworths Limited: Current organizational structure
The current organization structure of Woolworths Limited shows the roles and
responsibilities of the executives associated to the company. The organizational structure of the
company is comprises of a four level managerial structure. All the organizational executives
communicate with each other appropriately to meet the functional and operational activities

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appropriately (Flaherty, 2018). The Organizational structure of the company is consists of Chief
Executive officer (CEO), finance manager, project manager, business development manager,
operational manager, chairman, non executive director, Human Resource manager etc.
Figure 1: Organizational structure of Woolworths Limited
(Sources: Methner, Hamann & Nilsson, 2015, pp-100)
All the members associated to the company are needed to play active roles to develop and
deliver consumer centric service. Customer centric system will help the company to gain
effective success and measurable revenues from the competitive market place.
1.2 Operational problems experienced by the structure
Due to lack technical, managerial, operational and functional approaches the company is
facing major challenges from the market trends. The managerial and functional structure of

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Woolworths Limited is lagging behind from the expected outcome for the operational issues
(Bailey, 2016). The operational issues the company is experiencing are elaborated below:
Resource management issues: The resource management system of the company is
divided into two different parts such as Human resource manager and physical resource manager.
The role of the human resource manager is to manage the employees and their activities in the
company whereas; the physical resource manager is responsible to identify proper resource those
are needed to implement the information management system for the company (Cameron et al.,
2015). However, due to the frequently increasing employees and services of the company the
amount of physical and human resources are eventually increasing. Management of those
resources have become an serious issue for Woolworths Limited.
Supply chain management issue: The supply chain management system of the company
is referred to as an oversight for different materials in terms of information, finance management,
operational components. From the consumer’s point of view the management approach used by
the company between the suppliers and the buyers are not balanced enough thus, the company
fails to deliver the integrated business activities (Islam, Jain & Haque, 2016). This supply chain
managerial issue affects both the service and productivity of the company.
Capability and demand management system: Woolworths Limited is opening many
stores throughout Australia and New Zealand. Besides stores they also serves services to their
consumers through online shopping. Thus, it can be said that, the time management and demand
management system used by Woolworths Limited is not at all appreciable from the consumer’s
perspectives.

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Inappropriate communication: The communication approach used by the company is
not properly managed due to huge number of consumers and name physical stores. The company
generally uses upward communication where the higher level authority guides the employees but
never considers the ideas and thought of the employees (Mortimer, 2014). Rather they also do
not consider the feedback given by the customers.
Improper service management: Apart from all these the service management system
used by the company is not professionally designed. Due to lack management measures
Woolworths fails to adopt performance measuring processes (Treves, 2017). In order to meet the
requirements of the consumers the company should adopt proper service management system for
their company.
1.3 Mostly likely system acquisition method
Different kinds of system acquisition methods are there among those the most suitable
method should be adopted by the company to gain effective and measurable commercial success.
After analyzing the market trends for Woolworths Limited it has been found that, ERP (Supply
chain management) system is the most suitable system acquisition model to be applied to reduce
the errors. In order to meet the business requirements and processes the supply chain
management system will help the company to build secured communication and data protection
ability as well (Bailey, 2016). Even the operational departments of the company will also be able
to communicate with to each other appropriately. In this model none of the external and
unauthorized are allowed to access data from the server without permission. The decision
making approach of the company also become easier than the others.

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In order to adopt this method professional skill and experiences are needed by the system
developers thus, proper training and development programs are organized by the company to
deliver on-time and effective service to the consumers.
1.4 System flowchart for the sales procedure for Woolworths Limited
The sales procedure of any company is the most important part because it leads or drives
an organization towards success. The sales procedure of the company should be error free to grab
more number of consumers over the other competitor companies (Erturk, & Fail, 2015). In order
to obtain commercial success form the market the most important aspects on which the company
should focus are the price of the products, delivery efficiency and service approach. The sales
procedure flowchart used by the company is given below:

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Figure 2: Sales procedure flowchart for Woolworths Limited
(Source: Created by author)
Through online service the consumers will be able get their desired products anytime and
from anywhere. Moreover, it can be said that the sales structure of a company should be error
free and must impact the consumers positively.

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1.5 Identification of the control problems in the system and the sort of frauds
Due to lack of inventory management system, Woolworths Limited is facing serious
control level issues. For different companies the inventory management system varies a lot thus
for Woolworths limited the inventory management system is also different (Montiel-Reyes et al.,
2014). For this company the identified control problems are as follows:
Improper selling and buying approach: One of the major control level issues of
Woolworths Limited is their selling and buying approach. After selling any product to the
consumers the product log used by the company should be updated accordingly but the strategic
management system used by the company lags this feature (Hingorani, Beasley & Bradford,
2015). Fraud from both the selling and purchase levels may arise due to inadequate
functionalities of the Information system used by the company.
Security issues: The Information system used by the company should have proper
security codes and protection for protecting confidential information stored about the consumers,
employees and even about products (Cheng et al., 2014). The products processing approach of
the company is very much challenging.
Part 2
2.1 Development and adoption of accounting software packages
Based on the business background and service details the company should select the mist
suitable online accounting software package. For this report the nominated accounting software
package is XERO that is widely used by most of the medium and large organizations for

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managing large set of information (Muthoka & Oduor, 2014). This particular online software
package is based on cloud server and all its application can also run over the cloud server.
As the platform used by XERO is cloud based thus it has high level information security
and huge storage capacity as well. The consumers who are using this accounting software
package can also eventually access their required information from anywhere and anytime.
However, this particular accounting software package is not applicable in large business
organizations (Bailey, 2016). The server can be connected to the office hardware equipments but
it is highly secured. It can run all necessary applications and through this the users will be able to
access all upgraded information. All business activities can collaboratively evaluate their outputs
on the server platform (Treves, 2017). The characteristics of the XERO accounting software
package involve bank reconciliation, online feedback, purchase orders, financial reporting etc. It
also gives enough security to the user which implies that only the authorized users will be able to
access information from the server (Islam, Jain & Haque, 2016). The server should be properly
secured as it is comprises of both financial and commercial status of the consumers and
employees.
2.2 The current market size
After analyzing the current market status and trends it is found that, XERO is one of the
most widely used accounting software packages in Australia. The subscription package for
XERO is reasonable and due to number of growing consumers for the company it is found that
the current revenue of the company has obtained is around $260.00 Million till 2017. On the
other hand the number of subscribers for the company is approximately 718,000 Million. It is
also estimated that, short term deposit for the company both in terms of cash as well as cash
equivalent till March 2017 are 208.10 Million (Ma, 2015). Overall it has been found that the

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market revenue of the company has been increased up to 70% from the traditional time. In
addition to this it is also found that, the investing and operating cost estimated for the company
has become around $40.00 Million in the last year. It is also defined that in order to drive the
business towards high success in terms of ROI cash flow, the growth plan which is build can be
easily evaluated as XERO is having enough capital to execute the plan (Treves, 2017).
According to the market trends it is found that, over 10 Million of users are become the user if
XERO accounting software package.
2.3 Identification of the leaders in the market and their competitive advantages
Besides XERO there are many other accounting software packages available in the
competitive market such MYOB, Reckon, SaaSu, QuickBooks etc. In order to gain both long
term and short term success from the competitive market, XERO should focus on resources and
substantial revenues of other companies (Bailey, 2016). The existing service and performance of
the company is not meeting the other competitors due to lack of financial support from the
Australian Government and other sponsors. From the results of market analysis it is identified
that MYIB is the biggest competitor to XERO.
MYOB is a very user friendly accounting software package which implies that users can
easily access the system and no such professional training is needed to operate this accounting
software package. For this particular service provider the subscription rate is lesser than XERO.
This computer based accounting system has generating many headlines for the accounting than
the normal (Cheng, Green & Ko, 2014). This is one of the highlighted publicity traded
companies in Australia whose prominence was return alongside. The share price of the company
is very high which again huge fit is for the company. The accounting right of MYOB can cover
all bases in terms of inventory tracking, purchase and selling tracking etc.

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2.4 Identification of the current gaps and challenges encountered by the users of the
accounting software package
There are many XERO accounting software package users in Australia and after
analyzing the current market trends it has been found that the users are facing certain current
challenges and gaps simultaneously those are need to be resolved. The current gaps that the users
of XERO are facing are as follows:
Security issues: The users are facing the main issues that have been highlighted is lack of
security. This software package is willing to enter to the user’s server to access all personnel and
financial information of the users (Erturk & Fail, 2015). Again due to lack of security
approaches the confidential information are getting hijacked by the unauthenticated users.
Cost of the service: The costs allotted for the service are very high which a major
challenge to the company. The trail version packages offered by XERO is too high than the other
service providers. The technical cost required and estimated for the company is very high.
Recommendations
In order to resolve the identified issues, the technical approaches those should be adopted for the
XERO are as follows:
Encryption algorithm: Encryption algorithm helps the company to protect their information
from external assaults and unwanted data access.
Firewall: The companies, who are using the online accounting software package, must use
application firewall to secure the data transmission channel.

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Training and development: Besides technical experts in order to make the application much
effective it is necessary for the company to organize proper training and development programs
for the existing employees of the company.

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