Strategic Information Systems: A Case Study of Hume Bank

This study examines the critical role of strategic information systems in business organizations, focusing on Hume Bank, an Australian retail bank. It analyzes the current organizational structure, operational problems, and the potential benefits of implementing an Enterprise Resource Planning (ERP) system. The study also explores the development and adoption of accounting software packages, including the market size, competitive landscape, and challenges associated with their implementation. The paper concludes by recommending the adoption of SAP accounting software to enhance Hume Bank's efficiency, productivity, and competitive advantage.

Strategic Information System
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Contents
Introduction......................................................................................................................................3
Part 1................................................................................................................................................4
The current organizational structure............................................................................................4
Operational problems with the organizational structure..............................................................5
System acquisition method: ERP.................................................................................................5
Sales procedure of Hume Bank...................................................................................................6
Control problems in the system...................................................................................................7
Part 2................................................................................................................................................9
Development and adoption of the accounting software packages...............................................9
The current market size.............................................................................................................10
Market leaders and competitive advantage................................................................................11
Problems and challenges faced by accounting software packages............................................11
Conclusion.....................................................................................................................................13
References......................................................................................................................................14
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Introduction
With the continuous growth and expansion of information technology in the present
environment, there is a high need for the information systems in the business organizations for
the smooth and systematic working of the business operations. The information systems are
developed in order to avail corporate business advantage against the competitors in the market.
The area of the present study is to focus on the significant importance of the strategic
information systems in the business organization by critically evaluating the need for information
systems. For the purpose, Hume Bank an Australian bank, that deals in retail banking and offers
financial services to the customers across Australia, has been taken into consideration for the
specific and systematic analysis of the information systems. The study will examine the
operational problems faced by the organization and how the implementation of the information
system will eliminate the issues in the organizational structure and business processes of the
company.
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Part 1
The current organizational structure
As per the report of Hume Bank, (2018), Hume Bank is a financial institution in Australia that
offers financial and banking services with the excellent products and unparalleled experiences to
its customers. The organization uses accounting software packages in its business operations in
order to offer flexible and effective services to the customers with fewer complications.
Accounting software is the application software that records and analyse accounting transactions
such as accounts payable, accounts receivable with the help of the functional modules. In a
banking organization like Hume Bank accounting software packages are very helpful in
automating the sales procedures, billing fulfillment, and distribution of the services. The
organization provides products and services to the customers in order to avail interest and rates.
The directors and executives of the organization possess sound knowledge of the complex
monetary instruments that help them in the implementation of sound business decisions for the
maximum profit and market advantage (Hume Bank, 2018). The organizational structure of the
Hume bank is highlighted as under:
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Chief
information
officer
research
department
Systems
engineering
Online
marketing
services
Relationhshi
p marketing
Technology
customer
services
Technology
support
center
Application
development
Data
Integration
Accounting
department

(Source: Created by Author)
Operational problems with the organizational structure
As the organizational structure of the organization is vast and wide that in addition with the
advantages of efficiency and productivity brings a number of errors and problems for the
organization that directly impacts the market performance of the organization. One of the most
typical problems with this organizational structure is the rigid communication between the
employees and the management that makes the banking operations slow and inflexible. Lateral
and regular communication between the departments is highly necessary for the dissemination of
the information not only vertically but also in horizontal form. It affects the efficiency of the
organization that disturbs the productivity and quality of the services. Also due to the flow of
information from a number of channels, the decision making the process of the organization
unnecessary stretches that become an obstacle in the timely completion of the organizational
goals and objectives (Hume Bank, 2018).
System acquisition method: ERP
In the words of Kellner & Swihart, (2014), the acquisition of the information systems in the
organization is quite a complex method as it is important analysing the selected system properly
and systematically so as to learn about its strengths and weaknesses in order to avoid future
errors and complications. In order to improve the efficiency and productivity in the business
operations and process, Hume Bank can adopt ERP (Enterprise Resource Planning) Solutions
that helps the organization in making the operational activities more flexible and efficient.
Enterprise resource planning or commonly known as ERP is a widely used business process
management software that offers an opportunity to the organization to use the integrated system
of applications for the better management and automation of the business functions. The business
process management software effectively handles the complexity of the banking sector with ease
and added security. ERP solutions will offer the access to secure transactions, live operating
tracking, 24*7 information base, systematic analytics and evaluation etc. (Yigitbasioglu, 2015).
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With the application of the ERP software, Hume bank can be likely to be free from the hassles
and complexity of the banking industry and offers unerring banking experience to the customers
with the proficient and skilled solutions.
Sales procedure of Hume Bank
According to the views of Larrinaga, et. al. (2014), sales procedure or process is a systematic
and repeatable series of steps and actions that are used for mapping and tracking interaction with
stages for their first point of engagement. Basically, it is the systematic approach to selling the
business deliverables for uncovering the needs and demands of the customers and to build
relationships and trust.
Steps Activities Process owner Sales activity
support
1. Enquiry Customer mapping
Research
Sales team Assistant sales
team and
Marketing
2 Understanding
the requirement
Solution approach
Description
Proposal
Sales team Sales team
3 Solutions for
technical clearance
Sales presentations
Follow up
Sales team Sales team
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4 Closing deal with
documentation
Delivery of the final
solution to the customer
Operations Finance
(Source: Conceptdraw, 2017)
The above highlighted is the sales procedure of Hume Bank that offers step by step services to
the customers in order to meet their demands and expectations with greater ease and flexibility.
The organization believe in the fact that the more relationship will it develop, the more numbers
of customers it will have. Having strong customer base help in the long-term survival and
sustainability of the business and generates maximum profits (Larrinaga, et. al., 2014).
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Control problems in the system
Maintaining control in the sales process is a big part that ensures the success of the sales. The
sales managers of Hume Bank often complain about the complexity of the sales process that
leads to the disturbance of the entire sales process. A number of challenges have been identified
in the control system that gives rise to a number of errors and frauds which affects the
performance as well as a market image of the organization. As the sales process of the
organization is lengthy, the time frame of the decision-making process is long that delays the
sales deadlines and the sales managers often miss the targets. Due to this, extensive burdens
come on the head of the sales and operations teams (Hao and Shihong, 2015). No clear
presentation of the value proposition is also another drawback of the sales proceeds of the
organization. It is essential for the organization to enhance the value proposition so as to make a
clear picture in the minds of the customers about what are the services offered by the company
and how will it create value for them? The sales procedure of the organizations also lacks
roadmaps as the formation of the roadmaps help the organization in understanding the direction
where it is leading. Also, some cases of fraud arise, where some employees try to take shortcuts
in order to get the sales faster that in results leads to no sales. Also, false allocation of the
inventories leads to fraud that hampers the entire sales procedure of the organization. The
organization must lay emphasis on strengthening the model of vendor management and supply
chain with an objective to avoid the complications and errors in the control system (Larrinaga, et.
al., 2014).
In addition to the above control problems, the sales procedures of the company suffer from the
problem of inability to respond to the changes and errors occurs. There is a number of errors
occur in case of changes made in any of the sales activity. Process inconsistency is also another
issue that leads to the inability of centralising and streamlining the sales compensation process. It
is caused due to inaccurate results, short of time for the implementation of the new plans, the
absence of process documentation etc. (Hao and Shihong, 2015).
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Part 2
Development and adoption of the accounting software packages
As per the analysis of Kanellou and Spathis, (2013), in reference with the growing demand of
technology and highly cut-throat competition in the market, it is important for Hume Bank to
look for the opportunities in the accounting software packages in order to bring maximum
improvement in their business operations. The adoption of the accounting software package help
the business in regular tasks and activities and offers computerised solutions to each customer of
the organization. One of the beneficial features of adopting the accounting package is time
effectiveness. With the help of the computerised accounting software, starting from the end
business documents to the backup transactions all the activities execute simultaneously.
The SAP is one of the widely used accounting software packages that offer suitable programs for
the companies of any size. Hume Bank can go for SAP solutions to bring innovation in their
existing banking operations and services. The software offers widely accepted models and
accounting programs that offers end solutions to the organization with greater ease and
flexibility. It offers a wide range of accounting products that will help the company at every
stage and would be beneficial in minimizing the errors and complications in its organizational
structure and complex sales procedure. It is available in versions that include sophisticated
investigation, analysis and reporting, procurement and customer relationship management. The
products offered by SAP can be easily customised in accordance with the needs and demands of
the clients (Starinsky, 2016).
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(Source: India Mart, 2016)
With the application of the SAP accounting software in the business operations of Hume Bank,
the burden on the human resources of the organization will also reduce that let them invest their
attractive and specialised skills on the other areas of requirement. Also, the lengthy decision-
making process will be shortened that leads to the incorporation of the timely decisions in the
organization which are accurate and effective as well (Hao and Shihong, 2015).
The current market size
Operating in a service sector organization is highly competitive for the organizations as the
interest of the customers can be easily distracted by the competitors by offering better quality,
instant services and so on. The market size of Hume Bank is wide and vast that consists of
National banks, other domestic banks, foreign subsidiary banks, private banks etc. In reference to
the large market size of the organization, the demands and expectations of the customers are also
very high. Customers want to prefer instant banking and financial services without reaching to
the financial institutions. Hence in such highly competitive business environment and wider
market size, there is great need of the installation of the accounting software packages for the
banking institutions in order to fulfill the desires and expectations of the customers up to great
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extent. The installation of the accounting software package in the form of SAP software would
be very beneficial for the organization in order to last for long in the competitive environment.
Market leaders and competitive advantage
Technology is growing every single day and used by the organizations of all sizes; small,
medium or large to provide valuable and quality business solutions to the customers as
competitively surviving in the consumer industry is a critical task for the organizations
nowadays. Competition in the banking industry of Australia is up to its neck that induces the
existing banking business to regularly renew or update their systems in order to retain in the
industry for a longer time. The major competitors of Hume Bank in its industry are Westpac,
Bendigo bank, AMP bank ltd and Bank of Queensland. Banks like Westpac and Bendigo uses
the cloud computing software in order to simplify the accounting operations and to build strong
relationships and coordination with the customers. AMP bank ltd offers the tough fight to an
organization with the use of the Xero accounting software package in its business operations
(Soudani, 2012).
Problems and challenges faced by accounting software packages
In the words of Kayworth and Whitten, (2012), using information technology in the business is
not an easy task for the business organizations as technology always comes with challenges and
threats along with. Implementation of accounting software packages brings a number of
problems and challenges while it’s processing which should be critically considered by the
business organizations in order to ensure productive results. Safety and security of the data are
one of the major challenges associated with the application of the accounting software packages
like an SAP. Some of the accounting models proposed by SAP are friendly and easy to use while
some of the models are highly irritated and complicated which even cannot be understood by the
technical managers and influence the entire operations. The accounting models of SAP often lack
accuracy, validity, adaptability, and compatibility which are important in the use of any software
package. Installation of the accounting software packages like SAP is a costly investment in the
organization that not only ends up with its installation but also involves additional costs of
maintenance, update, monitoring etc. It leads to the increment of the cost of the organization that
in results might hamper the revenues and profits earned. In case of any error, retrieving
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information from the accounting software is a typical problem for the software users that might
destroy the complete information (Anandarajan, et. al., 2012).
For the smooth and successful working of the accounting software package, it is essential for the
managers to have complete knowledge of the software which they are using. Training should be
provided to the new staff that is using the technology for the first time so as to avoid the chances
of errors and mistakes on their sides. With the integration of the programs and services already
used by the company with the accounting software will help in tacking the issues and problems
incurred with greater ease and flexibility. In order to have back up of the information stored in
the accounting software, the software users should also store the data in the other files too in
order to save the data in case of any technical error arise in the software (Fayard, et. al., 2012).
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Conclusion
The above literature review on the strategic information system has clearly developed effective
knowledge and skills in the minds of readers associated with the use of accounting software
packages. The case study of Hume Bank has been used for the critical investigation and
examination of the information systems used in the organization. The knowledge of ERP
solutions has effectively highlighted in the literature review and along with their applicability in
the business operations. In reference to the organizational structure and sales procedure of the
organization, SAP accounting software package is recommended to the organization which can
definitely improve the business operations and processes of the organization in a systematic way.
With the installation of this accounting software package, Hume Bank can be able to achieve
competitive advantage in the market against its competitors in the market with greater ease and
flexibility. In addition with it, before the implementation of the accounting software package, it
is also essential to acquire complete and proper knowledge of it so as to drive successful
innovation in the organization that leads it towards sustainable growth and progress.
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References
 Anandarajan, M., Anandarajan, A. and Srinivasan, C.A., 2012. Business intelligence
techniques: a perspective from accounting and finance. Springer Science & Business Media.
 Conceptdraw, 2017. Providing telecom services - Cross-functional flowchart. [Online]
Conceptdraw, Available at: http://www.conceptdraw.com/examples/flow-chart-of-
telecommunication.
 Fact Sheet, 2016. India Mart. Available at https://www.indiamart.com/proddetail/sap-erp-
software-14940699897.html.
 Fayard, D., Lee, L.S., Leitch, R.A. and Kettinger, W.J., 2012. Effect of internal cost
management, information systems integration, and absorptive capacity on inter-
organizational cost management in supply chains. Accounting, Organizations and
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 Hao, Q. and Shihong, Z., 2015. Accounting Informationization Hierarchical Data Safety and
Prevention Based on Cloud Computing Environment.
 Hume Bank, 2018. Hume Bank. Available at https://www.humebank.com.au/.
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environment. International Journal of Accounting Information Systems, 14(3), pp.209-234.
 Kayworth, T. and Whitten, D., 2012. Effective information security requires a balance of
social and technology factors.
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Tracking System. U.S. Patent Application 14/510,682.
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organizational performance. International Journal of Economics and Finance, 4(5), p.136.
 Starinsky, R.W., 2016. Maximizing business performance through software packages: Best
practices for justification, selection, and implementation. CRC Press.
 Yigitbasioglu, O.M., 2015. External auditors' perceptions of cloud computing adoption in
Australia. International Journal of Accounting Information Systems, 18, pp.46-62.
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