T2 2017: Strategic Information Systems Analysis of Woolworths Limited

This report provides a comprehensive analysis of Woolworths Limited's strategic information systems. It begins with an overview of the company's organizational structure, highlighting operational problems such as communication issues, manual data entry, and internal conflicts. The report then explores potential solutions, emphasizing the benefits of implementing an Enterprise Resource Planning (ERP) system to integrate business processes and improve data management. A system flowchart of sales procedures illustrates the current processes and the advantages of ERP integration. The report also discusses the adoption of accounting software packages, the current market size and competitive landscape, and the challenges faced by the accounting software users, including cyber security concerns. The analysis concludes that the implementation of ERP and accounting software will provide Woolworths with a significant competitive advantage in the market.

Running Head: STRATEGIC INFORMATION SYSTEMS
HI5019 STRATEGIC INFORMATION SYSTEMS T2 2017
Name of the Student
Name of the University

1STRATEGIC INFORMATION SYSTEMS
Introduction
There are a number of large scale retail chains in Australia and Woolworths Limited is
one of them. This organization grew from a simple street-side store to one of the largest
organizations in Australia. The reason for using this particular organization as a case study for
this research is that Woolworths has been successful in Australia for quite some time now and is
now looking to grow further beyond the national boundaries.
In this report, an analysis has been conducted on Woolworths Limited and different
aspects of business operations like new accounting system and software acquisition packages
have been explored.
Discussion of the Topic: Part 1
1.1 Current Organizational Structure
The chosen organization for the analysis is Woolworths Limited, which is a one of the
largest retail supply chains in Australia. Woolworths began with just one single street-side store
where all the business operations were performed manually. With exponential growth over the
years, the company is currently the largest retail supply chain in Australia and one of the largest
in the world (Arli et al., 2013). With the growth in the business, the organization structure also
increased rapidly in order to manage all the complex business operations. The current
organizational structure at Woolworths is reflected in the following picture.

2STRATEGIC INFORMATION SYSTEMS
Figure 1: Organizational Structure at Woolworths
(Source: Lawley, Birch & Craig, 2016)
The current director of the company is Robert Corbett who also presides over the role
CEO of the company. He is advised by the directors’ board that consists of Adrienne Clarke
(Non Executive Director), Roderick Deane (Non Executive Director), James Strong (Chairman),
Diane Grady (Non Executive Director), Leone L’Huiller (Non Executive Director) and John
Astbury (Non Executive Director) (Lawley, Birch & Craig, 2016). Under the director’s board,
there is the management board where all the management officials have been appointed in
different roles namely Chief GM Project Refresh Stage 3, Director Supermarkets, Chief
Logistics and Information Officer, GM Human Resources, Chief GM Freestanding Liquor and
Petrol, Director General Merchandize & GM Big W, Chief Financial Officer, GM Property, GM

3STRATEGIC INFORMATION SYSTEMS
Corporate Services and GM Business Development. All the management board members preside
over their own departments and the subordinates work under them.
1.2 Operational Problems
Analyzing the entire organization structure, it can be said that company might face some
operational problems during the course of the business operations. The first main problem arises
from the fact that there are an excess number of officials in the management team. There is a
large number of general managers in a large number of departments that may result in internal
conflict between the managers. There are some unnecessary general manager posts that could
have been avoided by integrating some of the smaller departments (Ali & Soosay, 2015).
Although the company has created this number of posts to simplify the duties of each of the
managers as well as reduce the internal operation time, some of the duties of the general
managers often overlap, resulting in conflicts of ideas. Again, the company has appointed a large
number of non-executive directors who are poised to provide advices to the director and CEO
regarding policy making and planning of projects and operations. As they are not directly linked
with the regular executive operations, their duties are to analyze the operations and different
factors related to the business of the company and suggest suitable planning and changes to the
director. However, due to a large number of officials on the same role, there will be conflict of
ideas that can be both beneficial and harmful (Devin & Richards, 2016). More diversity in ideas
will allow the director to choose the best option whereas too many ideological differences will
not bring the best and the most feasible solution to the director. Another problem identified in
the organizational structure is the communication system. Due to the existence of too many
departments, most of the time, one department is not able to communicate with others.
Moreover, the internal operations portal often crashes due to the simultaneous online activities of

4STRATEGIC INFORMATION SYSTEMS
all the departments. These communication errors often cause significant problems in the
operations of the company. Finally, the most significant problem in the current organization
system is the unavailability of any suitable system acquisition method. In the current system, all
the acquisitions and data entries are done manually. Hence, the process is slow and many errors
occur during the process. Hence, these issues must be addressed immediately in order to
maintain the growth of the company.
1.3 System Acquisition Method
There are a number of system acquisition methods that can replace the existing manual
operations. These acquisition methods are driven by suitable softwares and are extremely
efficient in handling all the data without producing any errors. There are two main advantages of
these acquisition methods – the manual errors are removed and the operation time reduced
significantly. There are a number of system acquisition methods and the most suitable one that
will aid Woolworths is ERP (Enterprise Resource Planning) (Juan Ding et al., 2014). ERP is very
helpful in integrating all the business processes in one system and hence, it can be a very useful
tool for a company like Woolworths where there are a large number of departments with a large
number of managers in overall. With the implementation and use of the ERP system, all the
servers will be integrated into one with all the departments working in one common portal. In
order to implement security of each of the departments, each department will have separate sub-
servers that will be connected to the one common server (Ariyawardana, Ganegodage &
Mortlock, 2017). If a user from one department needs to access the system of another
department, he will need to verify his identity and then he will be allowed to enter into the
system. Another advantage of the implementation of ERP is that it will reduce the need of the

5STRATEGIC INFORMATION SYSTEMS
Product Display on Store
Arrival of Shoppers
Product Sent Back to Display
Payment
Scanning of the Product at Counter
Stock Recorded in Database
Add Price Tags
Selection of Desired Product
Affordable Non-Affordable
Check Out
Transaction Record Added
Inventory Record Updated
physical storage spaces and the ERP creates the common database in the online interface i.e. the
cloud.
1.4 System Flowchart of Sales Procedures
Figure 2: System Flowchart of Sales Procedures at Woolworths

6STRATEGIC INFORMATION SYSTEMS
(Source: Created by Author)
In the above diagram, the system flowchart of sales at Woolworths has been shown.
According to the picture, the initial sales process starts with adding the price tags and
identification number in form of bar codes to the products. After this, the bar codes are scanned
and the product listing automatically enters the sales database for keeping record of the
inventory. After that, the shoppers visit the store and select the products of their choice. When
the products are chosen and the shoppers find them affordable, they will proceed to the counter
for payment. At the counter, the attendant will scan the bar code of the product that will display
the amount needed to pay on the screen. Also, this will automatically update the inventory by
checking out the product from the stock. After the payment process, the attendant will close the
payment window in the computer screen as it will record the received amount and update the
financial record accordingly. However, the problem with the existing system at Woolworths is
that, these processes are executed under different database servers. Hence, a lot of
internetworking needs to be applied in order to bring continuity within the operation of business
entries and records. The application of the ERP system will provide integration into one common
database where all the details of inventory and payments will be processed automatically.
1.5 Control Problems
There are certain problems in this system as due to lack of sufficient monitoring of the
entire system. As there are a number of departments working together including the sales
department, the inventory department and the human resources department, there is no sufficient
monitoring of the system. As a result, even if there are errors in one particular department, it is
carried over to the other without anyone controlling and solving the issue. For instance, if by
mistake, the stock is not updated properly, the inventory records after a purchase are also not

7STRATEGIC INFORMATION SYSTEMS
updated accordingly. Hence, even if a customer cannot find a particular product, it will show
“AVAILABLE” in the company database. This will cause dissatisfaction among customers. The
main reason for occurrence of this error is that there is no one to control this problem and find
suitable solutions.
Discussion of the Topic: Part 2
2.1 Development and Adoption of Accounting Software Packages
According to Rajabian Tabesh, Batt and Butler (2016), adoption of accounting software
packages are extremely essential for the organizations that are looking to grow beyond the limits
of one particular country. The researchers argued that the accounting softwares completely
eliminate manual errors as every accounting operations are done by the computer in the virtual
storage interface. Moreover, the process is also extremely time efficient and reduces the
operation time of the system. However, adoption of the accounting software packages require
significant amount of budget and hence, the organizations should plan ahead and take suitable
steps for implementing a development project for accounting software packages.
2.2 Current Market Size
Jie, Parton and Chan (2015) said that owing to globalization of commerce, the current
market size is huge. Moreover, most of the large organizations are pushing their business limits
to other countries as well, resulting in the increase in competition in the market. Woolworths is a
retail chain company and even a few years ago, the market size of retail chains was limited to a
few cities only. However, as these organizations including Woolworth are venturing outside the
country as well, the market size is constantly growing. Having a reputed brand value also aids
this process significantly.

8STRATEGIC INFORMATION SYSTEMS
2.3 Leaders in Market and Competitive Advantage
According to Sullivan and Gouldson (2017), the competition in the retail market in
Australia is constantly increasing with a number of large sized companies are joining the market.
Initially, there were separate small and medium size organizations that dealt with the retail
market. However, owing to the success of Woolworths, numerous large organizations are also
opening retail chains. The leaders in retail chain in Australia include Coles, Amazon Australia,
Alibaba Group, David Jones, Dyson and Metcash to name some. All these companies are
flourishing in the Australian market and most of them also ventured into other countries to gain
access to the international market. These companies gain competitive advantage because of
budget efficient implementation of suitable information systems as well as accounting softwares
resulting in very efficient handling of the business operations.
2.4 Current Gaps and Challenges
The main challenge faced by the users of accounting softwares is the cyber security issue.
Since the entire operation in the software is hosted online, it is vulnerable to the external cyber
security attacks (Richards, Kjærnes & Vik, 2016). Moreover, there is the challenge of lack of
sufficient intelligence of the software. Efforts have been made by researchers recently to
integrate artificial intelligence in the accounting softwares to gain even more efficiency from the
system. It is recommended that the users should implement security softwares before the use of
the accounting softwares to protect the transaction details and financial data from external and
unauthorized users.

9STRATEGIC INFORMATION SYSTEMS
Conclusion
In this report, the existing business system of Woolworths Limited has been analyzed in
order to identify the problems arising from the organizational structure of the company as well as
other issues related to the business operations. Moreover, the possibilities and advantages of
implementation of accounting softwares and acquisition software packages have been analyzed.
From the analysis, it has been found that Woolworths will benefit from both as it will give them
sufficient competitive advantage in the market. Hence, Woolworths should consider replacing
the existing system with the system recommended in the report.

10STRATEGIC INFORMATION SYSTEMS
References
Ali, I., & Soosay, C. (2015). Understanding risks in the Australian citrus supply chain.
Ariyawardana, A., Ganegodage, K., & Mortlock, M. Y. (2017). Consumers' trust in vegetable
supply chain members and their behavioural responses: A study based in Queensland,
Australia. Food Control, 73, 193-201.
Arli, V., Dylke, S., Burgess, R., Campus, R., & Soldo, E. (2013). Woolworths Australia and
Walmart US: Best practices in supply chain collaboration. Journal of Economics,
Business & Accountancy Ventura, 16(1).
Cameron, A. J., Sayers, S. J., Sacks, G., & Thornton, L. E. (2015). Do the foods advertised in
Australian supermarket catalogues reflect national dietary guidelines?. Health promotion
international, 32(1), 113-121.
Devin, B., & Richards, C. (2016). Food waste, power, and corporate social responsibility in the
Australian food supply chain. Journal of Business Ethics, 1-12.
Jie, F., Parton, K., & Chan, C. (2015). Australian beef supply chain integration: case studies of
the two largest Australian supermarkets. International Journal of Supply Chain and
Operations Resilience, 1(2), 121-138.
Juan Ding, M., Jie, F., A. Parton, K., & J. Matanda, M. (2014). Relationships between quality of
information sharing and supply chain food quality in the Australian beef processing
industry. The International Journal of Logistics Management, 25(1), 85-108.

11STRATEGIC INFORMATION SYSTEMS
Lawley, M., Birch, D., & Craig, J. (2016). 20 Managing sustainability in the seafood supply
chain. A Stakeholder Approach to Managing Food: Local, National, and Global
Issues, 4, 284.
Pollard, C. M., Landrigan, T., Ellies, P., Kerr, D. A., Lester, M., & Goodchild, S. (2013).
Geographic factors as determinants of food security: a Western Australian food pricing
and quality study. Asia Pacific journal of clinical nutrition.
Rajabian Tabesh, A., Batt, P. J., & Butler, B. (2016). Modelling the Impact of Environmental
and Organizational Determinants on Green Supply Chain Innovation and
Performance. Journal of Food Products Marketing, 22(4), 436-454.
Richards, C., Kjærnes, U., & Vik, J. (2016). Food security in welfare capitalism: Comparing
social entitlements to food in Australia and Norway. Journal of Rural Studies, 43, 61-70.
Singh-Peterson, L., & Lawrence, G. (2015). Insights into community vulnerability and resilience
following natural disasters: perspectives with food retailers in Northern NSW,
Australia. Local Environment, 20(7), 782-795.
Sullivan, R., & Gouldson, A. (2017). The governance of corporate responses to climate change:
an international comparison. Business Strategy and the Environment, 26(4), 413-425.
Uddin, M. N., Quaddus, M., & Islam, N. (2017). Inter-organizational Supply Chain Performance:
How the Relationship Factors Influence the Australian Beef Industry?. In The Customer
is NOT Always Right? Marketing Orientationsin a Dynamic Business World (pp. 458-
464). Springer, Cham.

12STRATEGIC INFORMATION SYSTEMS
Verghese, K., Lewis, H., Lockrey, S., & Williams, H. (2013). The role of packaging in
minimising food waste in the supply chain of the future. RMIT University: Melbourne,
Australia.
Wardle, J. (2015). Price-based promotions of alcohol: Legislative consistencies and
inconsistencies across the Australian retail, entertainment and media
sectors. International Journal of Drug Policy, 26(5), 522-530.