HI5019 Strategic Info Systems: Woolworths Supermarket Analysis

This literature review provides an in-depth analysis of Woolworths' strategic information systems, organizational structure, and the adoption of accounting software packages. It examines the company's organizational structure, operational problems, and proposed ERP system acquisition methods, including a sales procedure system flowchart. The review identifies potential problems within the ERP system and possible fraud risks. Furthermore, it explores the development and adoption of accounting software, market size, competitive advantages of market leaders like Xero and MYOB, and challenges encountered by users. The review concludes with recommendations for improvement, addressing gaps and challenges in the development and implementation of accounting software packages within the Australian market.

Running head: WOOLWORTHS SUPERMARKET STRATEGIC INFORMATION SYSTEM
Woolworths Supermarket Strategic Information System
Name of the Student
Name of the University
Author Note

1WOOLWORTHS SUPERMARKET STRATEGIC INFORMATION SYSTEM
Executive Summary:
This paper describe about the strategic information system of the Woolworths supermarket.
The structure of the organization will be discussed and identified the operational problem
they have experience through the organizational structure. It will contain the system
acquisition method that would be helpful for the organization. The paper contains a simple
flowchart for the sales procedures system. Moreover, it will identify the problem of the
system used by the organization and discuss about the most possible fraud that can occur. In
the later part of the report, the development process of the account software packages will be
provided and discuss the adoption of the package in the organization. It will contain the
market size of the current organization. The market leaders will have competitive advantages
and current gaps and challenges have been encountered. At the end of the report, the paper
will be concluded with proper recommendation.

2WOOLWORTHS SUPERMARKET STRATEGIC INFORMATION SYSTEM
Table of Contents
Part 1:.........................................................................................................................................3
1. Woolworths Organizational Structure................................................................................3
2. Operational Problem with the Structure of the Organization.............................................4
3. Proposed ERP System Method for Acquisition:................................................................5
4. Sales Procedure System Flowchart:...................................................................................5
5. Identifying Problem with the ERP system and possible fraud:..........................................7
Part 2:.........................................................................................................................................8
1. Development and adoption of account software package..................................................8
2. Market Size......................................................................................................................13
3. Identify competitive advantages of market leaders..........................................................13
4. Accounting Software Challenges Encountered by the user and customer:......................15
4.1 Recommendation and Suggestions:...................................................................................16
Conclusion................................................................................................................................17
Bibliography.............................................................................................................................18

3WOOLWORTHS SUPERMARKET STRATEGIC INFORMATION SYSTEM
Part 1:
1. Woolworths Organizational Structure
Woolworths is an Australian supermarket owned by Shop Direct Group and was
founded in the year 1924. The marketed and supplied products of Woolworths include
cosmetic and beauty products, clothing, electronics, furniture, housewares, jewellery, FMCG
at lot more. The Woolworths manages and supplies trusted and recognised brands such as
Freefrom, Macro, Fresh and Gold that deliver a world class experience to all levels of
customers. Woolworths is the high-street retail chain that operates in more than 800 stores
and has 111,000 employee working in the company. The structure provide a hierarchy where
at the top is the Non-Executive Director, Chairman followed by the Group Managing
Director and CEO. Under the CEO comes the Chief GM project Refresh Stage, Director of
the Supermarkets, Chief Logistics, & Information Officer, GM Human Resources, Chief GM
Freestanding Liquor & Petrol, Director General Merchandise GM Big W, Chief Financial
Officer, GM Business Development, GM Mercury Program, GM Supermarket Operations,
GM Corporate Services, GM Woolworths Academy, GM Big W, GM Property, and GM
Dick Smith Electronics. The hierarchy structure has been shown in the figure below:

4WOOLWORTHS SUPERMARKET STRATEGIC INFORMATION SYSTEM
Figure 1: Woolworths Food Group Organization Structure
Source: Author
2. Operational Problem with the Structure of the Organization
The position that Woolworths has achieved was dominated by the Australian government.
They restricted Woolworth to keep the price of the product higher. The growth in the sales
was very slow. The staff included in the structure are morally week. Currently Coles is the
biggest rival of Woolworth (Woolworthsgroup.com.au., 2018). In the operation, the company
has plan some strategies for growth. The product has to sell in less price, when the concern
being share to the director of the supermarket still there was no response regarding the price
issue. The production team were working on the matter of the price issue. Unfortunately, the
external environment mostly affect in dominating the Australian retail market were the
government of Australia has restricted the Woolworth to keep higher prices for their product
in collaboration with the Coles. This has led to major weakness in the growth level of the
company.

5WOOLWORTHS SUPERMARKET STRATEGIC INFORMATION SYSTEM
3. Proposed ERP System Method for Acquisition:
ERP is the is most likely system acquisition method that would be used for the
organization. The entire organization need to plan to implement the ERP system. With the
use of ERP system it is easy to understand and negotiate with the vendors about the
requirements of the user based on their terms and conditions. The ERP acquisition process
has four phases, the first phase begins with initiation, second phase with selection, third phase
with final choice and the forth phase is negotiation.
4. Sales Procedure System Flowchart:
Figure 1: Sales Procedure System Flowchart
The flowchart shows the basic procedure of sales in the Woolworth supermarket. The
customer takes the decision to pick or purchase the order, determine the quantity of the order,

6WOOLWORTHS SUPERMARKET STRATEGIC INFORMATION SYSTEM
assemble the item. Once the item has selected it will assemble and the box and package will
be done for the items after successful payment through credit, debit or net banking.
Figure 2: Integrated Sales Order Procedure
Source: Author

7WOOLWORTHS SUPERMARKET STRATEGIC INFORMATION SYSTEM
Figure 3: DFD of Sales Return Procedure
Source: Author
Based on the revenue cycle the activities of the sale procedure is shown in the diagram above.
The cycle generate two revenue, Sales and Finance. The business activities perform in this
cycle are basically
Sales order entry
Shipping
Billing
Cash Collection & Ledgers update
5. Identifying Problem with the ERP system and possible fraud:
The problem in the ERP system is the inaccurate order of the customer, with poor credits
the sales are done to the customers, the stocks are out, and cost in carrying.
Shipping Process: In the process of shipping errors occur and there is a chances that
the order might be stolen by the inventory.
Billing Process: In the process of billing, errors may be found in the bill, customer
would not be able to receive the bill. It may even happen that the user could not access the
customer’s account properly.
Cash Collection: During the collection of the cash, there is a chances of losing data
of the account due to some error. This can threaten the existence of the company and an
inaccurate response to the customers enquires.
When the confidential information of the customer is disclosed, it dissatisfies the
customers and the organization has to face loss of sales in the future. The customer does not

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come back to purchase any product from the organization because the relation with the
customer has break and lead to legal sanctions and fines. This result in reduction of profit. It
may even accidentally happen that the important data have got erase as the disks and tapes
were not label properly. There are lots of sensitive data in the ERP system and users are allow
to access the data encryption for transmission and storage.
Part 2:
1. Development and adoption of account software package
Account Information System (AIS) is an application software basically use for recording
the process of transaction in accounting. The application may include some module that
namely the financial report module, payroll module, balance module, payable module, and
receivable module. Mostly the in-house business creates accounting software or the third
party developer might have deliver it. There is a variation in the package of accounting
software based on the cost and complexity. A competitive edge has been brought by the
modern business to use the process of managerial decision for the functional module.
Accounting software has undertaken a remarkable change in the Woolworth organization of
Australian due to their technology advancement. With all these historical development,
adaptability, use and challenges, the research paper has discussed in the literature review
about the use of practicing accounting in the business. The literature has also explored the
current size of the market and identify the market leaders among the competitors for
competitive advantages that has adopted the packages of accounting software in Australia. In
the final section of the literature review, some suggestions and recommendation will be
provided based on the current gaps challenges that has encountered during the development
and improvement of the accounting software packages (ABC News, 2018).

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When tracking back to 1959 about the origin of accounting software at that time IBM
develop 9PAC for the first time, which was a report generation language that stores and
access the data structure from the relational database. With the development and designing of
accounting systems for a specific requirement, the companies decided to invest for the SAP
RF to handle the business operations for the process of taking faster financial decision. The
Australian Teleware product publisher acquired the Intuit Company and had changed its
name changed to MYOB Limited (Anon, 2018).
Accounting software was adopted quickly by the organization. In one of the study that
was conducted by the New Zealand Company for the accounting software had involved
almost 1622 small businesses. With result to this, it was found that Australian small business
was ahead of adopting the accounting software in comparison to any other countries
(Citeseerx.ist.psu.edu., 2018). With the adoption of the accounting software system, the
tedious use of paperwork has been reduce. The process of accounting starts with cash book,
trial balance, sales ledgers, petty cash ledgers, purchase ledgers, adjusting entries, and
financial reports. Previously in manual accounting there was a need of lot of paperwork and
bookkeepers. The system of accounting software is quick and easy to use for inputs of correct
accounts. This will help in generating reports automatically. The major factor that leads to
adoption of accounting software is effectiveness and efficacy for the growing business.
MYOB as an accounting software system has been develop for the Woolworth organization
were the below steps were followed for sales transactions and other processes

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Step1:
Step 2:

11WOOLWORTHS SUPERMARKET STRATEGIC INFORMATION SYSTEM
Step 3:
Step 4: