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HI5019 Strategic Information Systems for Organizational Structure

Question 

Part 1

1. The current organizational structure
2. What operational problems (e.g., inefficiency, errors) do you think the organisation could experience because of this structure?
3. What is the most likely system acquisition method— commercial software, custom software, or ERP?
4. Describes and prepare a system flowchart of the sales procedures for the chosen organisation (company)
5. Identify any control problems in the system and what sorts of fraud are possible in this system?

Part 2

1. Development and adoption of the accounting software packages,
2. The current market size,
3. Identify the leaders in the market and what gives them the competitive advantage,
4. Identify the current gaps or challenges encountered by users or customers of accounting software/packages and make relevant suggestions or recommendations.

Answer

Part 1

1. Introduction

Organizational structure provides a clear picture of the activities and the hierarchy of the organization. A proper organizational structure helps in managing the process of task allocation, coordination between the tasks and task supervision, which helps in achieving the organizational aim. A proper organizational structure helps in managing the information flow within the organization (Christensen 2013). A proper and a flexible organizational structure help in improving the communication flow among the staffs and employees thus managing the processes and the workflow within the organization quite effectively. The organizational structure of the Lion Company, the operational problems faced by the company, the most likely system acquisition method and the control problems associated with the organization is elaborated in the following paragraphs.

2. The current organizational Structure

Proper organizational structure helps in maintaining and managing the organizational aim and further helps in understanding the functional requirements of the organization. Furthermore it offers transparency in settling different issues associated with the organization. The current organizational structure of Lion Company Australia is illustrated below-

                                                                      Figure 1: Organizational Structure

                                                                            (Source: Lionco.com 2017)

3. Operational problems due to inefficient organizational structure

Operat


ional problem may arise in an organization due to a number of reasons the major reason being the lack of proper operational strategy.  The major objective of the Lion Company is keeping their customer base apart from increasing the market share and developing high margin product and services (Domeika 2015). A well-managed operational system helps in yielding maximum profit by providing quality materials and effective services. Lion Company has faced different operational issue due to a complex organization structure that hampered the organizational efficiency largely. The operational problems of Lion Company are elaborated below-

1) Absence of Strategic Management:  developing a strategy and a proper plan for managing, controlling and supervising different operations within an organization is very essential. Lack of proper strategic management in Lion Company is a major reason of the control problems associated with the organization. Moreover, a proper strategic management helps in effective decision-making (Warren, Reeve and Duchac 2013). Absence of a proper strategic management further affects the organization as it loses its sustainability in the target market due to an ineffective organizational structure.

2) Poor Communication: One of the major operational issues associated with the Lion Company is a poor communication structure. Poor communication may give rise to conflicts of ideas and decision thus making the entire process quite complex. Conflict in decision-making makes it difficult for the organization in achieving the functional benefits and maintaining the sustainability in the target market (Kiani, Lamego and O'reilly 2014).  One of the major concerns in Lion Company is that, the communication path is not clearly defined due to which the low-grade staffs cannot contribute to the process of decision-making.

3) Less Productivity: The major operational problem associated with Lion Company is the reduced productivity, which is again an effect of poor organizational structure. This occurs due to the poor management of the supply chain processes and the work flow within the organization. The Companies organizational head should properly define the organizational goal and the different functional areas of the organization (Lionco.com 2017). This will help in increasing the productivity o f the organization, which may further help in gaining a competitive advantage in the target market. Therefore, this aspect should be considered with the highest priority in order to eliminate the operational problems associated with the Company.

4) Inefficient Supply Chain management: Productivity problem is further coupled with a poor supply chain management. This major functional or operational issue, which is directly linked with the organizational structure in the inefficient supply chain management (Gereffi and Fernandez-Stark 2016). The inefficient organizational structure weakens all the relations within an organization resulting in a poor supply chain management.

5) Inefficient human resource management: proper Human resource management is necessary in managing the different work processes within the organization (Hendry 2012). HR is essential for defining the roles of the employees according to their capabilities. An improper human resource is a result of an improper organizational structure. Since the process flows within the organization is not clearly defined due to an ineffective human resource management, it results in an ineffective supply chain management and less productivity.

4. System Acquisition Method  

The most likely system acquisition method is definitely the ERP or Enterprise resource planning system. ERP can considerably helps in dealing with the operational problems faced by Lion Company. Implementation of ERP not only automates the various process and the tasks within an organization, but also helps in reducing the workload of the employees thus eliminating the risk of human error (Wallace and Sheetz 2014). ERP helps in managing and handling the different business operations within the organization with the involvement of software. ERP software streamlines the processes and the different tasks, which include managing the product development, sales and marketing. Many organizations have successfully implemented the Enterprise resource planning software, which later proved to be an effective decision by the organization (Leon 2014). Therefore, implementation of ERP by Lion Company would be a wise decision, would provide an effective solution to the organizational members, and would further help the organization in achieving their set goals and target. Moreover, an ERP helps in providing an effective communication associated with the culture and organizational structure of Lion Company.

5. System flow chart of the Sales and procedures of Lion Company

The system flow chart, which is illustrated below is based on the different issues that are mainly identified with the system architecture, based on the organizational structure of Lion Company.

                                                          Figure 2: Flow Chart representing sales of Lion Company

                                                                                        (Source: Lionco.com 2017)

Control problems in the System and Possible Frauds

The control issues associated with the Lion Company are mainly identified in the sales, operations and the system of the company. The control problems identified are mainly due to the poor organizational structure and operational management. The control problems associated with the Lion Company are listed below-

1) Ineffective control process is the source of all the control problems associated with the Lion Company. A number of false sales and purchase are example of the frauds due to an ineffective control process (March 2013).

2) Lion Company has no proper compliance activity coupled with the lack of proper control activity and formalization (Cummings and Worley 2014).

3) Another major control problem is the absence of proper monitoring and control of processes and workflow associated with the supply chain management of Lion Company.

Frauds Possible within the organization

  1. Fraud in sales and production
  2. Fraud in supply chain management due to the absence of tracking the project progress

Conclusion

Therefore, from the above discussion, it can be concluded that an inefficient organizational structure may lead to a number of problems in an organization. Maintaining a proper organizational structure is necessary in order to eliminate different operational and control problems associated with the organization. The report discusses about the organization Lion Company based on Australia. The different operational issues associated with the company are discussed in the report and a proper system acquisition method, which is ERP, is discussed in the report as well. Implementation of ERP may help the organization in managing the different sales processes within the organization.

Part 2

1. Introduction

This part of the report discusses the different accounting software and the benefit of this software in integrating the financial processes of the business. Accounting software helps in recording and processing all the account related works and transactions and helps in tracking all the financial issues and processes on basis of the organizational standard. The report elaborates the feature of an accounting software Xero, that provides a cost-effective solution to the different business processes in the organization  (Murthy and Abeysekera 2015 ). The functionality of the accounting software, the market size, leaders of the market and the challenges of using accounting software is elaborated in the following paragraphs-

2. Development and Adoption of the accounting software packages

Adoption of accounting software has been proven beneficial to a number of organizations. Accounting software helps in managing all the account related tasks within an organization. Lion has been using accounting software to integrate its financial processes. Xero is an example of accounting software that seamlessly manages all the account related works in the organization. Therefore, adoption of accounting packages may help in reducing the workload within an organization (Von Der Emde et al. 2014).

3. The Current market Size

The accounting software that occupies a larger sector of the Australian target market is Xero and MYOB.  Xero has a greater competitive advantage and occupies a larger sector of Australian target market as it provides a wide range of benefits and a cost effective solution. Xero is chosen by most of the business organizations because it provides an effective solution to all the issues related to the manual operation of work processes (Robey,  Anderson and Raymond 2013). Xero has shown a considerable growth in its sales and services over the years by providing different advantageous benefits to all its users and the clients.

                                                                           Figure 3: Representing the growth of xero

                                                                           (Source: Xero Accounting Software 2017)

4. Identification of leaders in the Market 

As discussed earlier, two accounting software that leads in the Australian target market are Xero and MYOB. They offer a wide range of advantages by streamlining all the financial processes within an organization and therefore, chosen by most of the users. The manual operations of the different financial processes are automated quite effectively and therefore, the demand of accounting software is increasing in the market considerably. The use of accounting software eliminates the redundancy ad errors associated with the entry and managing the database of the organization.  The competitive advantages of these softwares are listed below-

1) The storage of the data in cloud helps in easy access and storage of the data in accordance to the need of the client. The cloud based set up thus helps in maintaining the competitive advantage in Australian target market.

2) A proper and speedy functional output is another important feature of this organization. Xero accounting software is pro in delivering fast results and thus leading the Australian target market.

3) Simple an easy to use interface and installation procedure of the software gives competitive advantage to the software. The user interface of xero is simple and easy to operate, which is one of the major reason of the popularity of this software.  

5. Challenges encountered by the users and its relevant suggestions

Along with the wide range of benefits offered by the accounting software packages, there are certain issues that need an immediate attention in order to retain the market position of the software. The different challenges that a user of accounting software encounters are listed below-

1) The accounting software is mainly based on cloud and therefore, the risk of security concerns remain associated with the software. The cloud-based solution includes different security issues with the system and the architecture of the organization (Mudge 2013).

2) The installation and the update procedures of accounting software is quite complex and time consuming as well (Xero Accounting Software 2017).

3) Few operations of the software is quite complex.

The issues identified above should be fixed in order to retain the market position of the software. The security issues can be fixed by implementing proper security control mechanism and processes. The complexity can be reduced with further development and modernization of the software.

Conclusion

Therefore, from the above discussion, it can be concluded that, Xero is a good accounting software that provides effective business solution. Accounting software helps in managing the financial transactions of the organization, thus helping the organization in eliminating any sorts of error or fraud with the business processes. The report elaborates the advantages offered by the accounting software Xero and the features of the software. The market leaders and the current market size is discussed in the report followed by a brief description different challenges, an user of an accounting software faces or might face.

References

Christensen, C., 2013. The innovator's dilemma: when new technologies cause great firms to fail. Harvard Business Review Press.

Cummings, T.G. and Worley, C.G., 2014. Organization development and change. Cengage learning.

Domeika, P., 2015. Creation of the Information system of enterprise fixed asset accounting. Engineering Economics, 60(5).

Gereffi, G. and Fernandez-Stark, K., 2016. Global value chain analysis: a primer.

Hendry, C., 2012. Human resource management. Routledge.

Kiani, M.J.E., Lamego, M. and O'reilly, M., Masimo Corporation, 2014. Patient monitor capable of accounting for environmental conditions. U.S. Patent 8,740,792.

Leon, A., 2014. Enterprise resource planning. McGraw-Hill Education.

Lionco.com. (2017). Welcome! | Lion. [online] Available at: https://www.lionco.com/ [Accessed 7 September 2017].

March, J.G. ed., 2013. Handbook of Organizations (RLE: Organizations) (Vol. 20). Routledge.

Mudge, J.C., 2013. Cloud computing-its development and security. Australian Journal of Telecommunications and the Digital Economy, 1(1).

Murthy, V. and Abeysekera, I., 2015. Corporate social reporting practices of top Indian software firms.

Robey, D., Anderson, C. and Raymond, B., 2013. Information technology, materiality, and organizational change: A professional odyssey. Journal of the Association for Information Systems, 14(7), p.379.

Von Der Emde, M., Hoffmann, T., Nowotny, D. and Penning, J., Sap Ag, 2014. Providing payment software application as enterprise services. U.S. Patent 8,671,032.

Wallace, L.G. and Sheetz, S.D., 2014. The adoption of software measures: A technology acceptance model (TAM) perspective. Information & Management, 51(2), pp.249-259.

Warren, C.S., Reeve, J.M. and Duchac, J., 2013. Financial & managerial accounting. Cengage Learning.

Xero Accounting Software. (2017). Xero Limited 2016 Annual Report. [online] Available at: https://www.xero.com/media/9883890/xro_2016_annual_report.pdf [Accessed 13 September 2017]

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