Strategic information systems are developed in accordance with the corporate business initiative thereby, providing a competitive advantage to the organisation (Galliers & Leidner, 2014). As a result, the service or product is delivered at a lower cost compared to others by the company. Strategic information system also allows the organisation to implement analytical tools for their information enabling them to recognise growth opportunities.
Aldi is known as the world’s lowest cost grocery retailer, currently operating in several countries. As the company is dealing with sales, use of appropriate accounting software is essential to provide them a competitive advantage by maintaining their accounts appropriately (“ALDI Australia”, 2017). The literature review includes determining the various aspects of Aldi in terms of strategic information management that provide the organisation with a competitive advantage.
As commented by Garling et al., (2013), organisational structure plays a significant role in determining the success of an organisation. The organisational structure includes the policies and rules of the organisation that is developed in accordance with the various responsibilities and roles conducted by the organisation. Moreover, the structure of the organisation also determines the way of information flow from level-to-level. According to Cosh, Fu & Hughes (2012), structure and strategy are related to each other as the structure of the organisation helps in developing appropriate strategies defining the roles and responsibilities. Therefore, stability is established within the organisation.
Aldi is currently having a decentralised organisational structure that is developed according to the current business strategy of the company. Decentralised structure is a lean and flat structure that has restricted the involvement of the staffs. The organisational structure is useful for Aidl, as the company operates in several countries. This provides an opportunity for Aidl to respond to local circumstances. Decentralised organisational structure helps in better and closer employee management thereby, enhancing community relations. Moreover, the structure results in an increase in the managerial social net product ensuring benefits for the company.
Implementation of decentralised organisational structure incurs some disadvantages for Aidl. According to Cavusgil et al., (2014), one of the major disadvantages of the decentralised organisational structure is having a limited number of staffs and lack of experience. Aidl has limited number of experienced staffs due to the decentralised structure. As a result, the organisation is lacking experienced personals in their departments. Dysfunctional decision-making is also a drawback in decentralised organisational structure. For example, a manager of one department of Aidl lowers the cost that eventually affects the quality of service provided to other departments within the organisation. Moreover, the higher managerial level might lose control over the decision-making process, as they are unaware of the operations conducted by managers of the lower level. As commented by Burton & Obel (2012), decentralised structure emphasises more on the smaller business sections. As a result, the principle objective and aim of Aidl is compromised as their goal is diverted.
According to Claver-Cortes, Pertusa-Ortega & Molina-Azorin (2012), the decentralised structure makes it difficult to ensure consistent policies and practices at different locations. As Aidl operates in several countries, it is difficult to maintain similar policies and practices within each of their stores.
System acquisition methods play a significant role in managing the security risks and events of an organisation while the company is operating. As commented by Fleischmann et al., (2014), security is an important aspect in system acquisition method as it deals with vital information of the organisation in terms of sales, revenues and organisational strategies. Aldi implements custom software that is organisation specific. For example, as Aldi is one of the low-cost grocery companies operating throughout the world, the company needs to manage effectively their accounts. As mentioned by Mas et al., (2014), as custom software is more organisation centric, the particular preferences and expectations are taken into consideration. This provides an opportunity for Aldi to consider all the possible risks and nuisances.
As a part of the custom software, accounting software of Aidl helps in managing, collecting, recording and processing the financial data of the company. Therefore, this provides an opportunity for Aldi to manage their financial resources appropriately in terms of auditing, financial accounting and reporting.
As commented by Scheer (2012), the sales of a company are closely related to the sales flowchart of the success of the company. The company fails to achieve results and obtain profit if the sales process is inappropriate though the other aspects such as planning, manufacturing, service delivery, communication and marketing are executed correctly (Heizer & Barry, 2013). Therefore, it is crucial for Aldi to have an optimised sales process flowchart detailing all the included steps to achieve maximum effectiveness and efficiency in terms of sales. The main aim of the sales process software includes appropriate use of accounting software to maximise and strengthen the sales of Aldi. The sales process flowchart of Aldi is structured below:
(“Sales Process Flowchart”, 2017)
The principle steps of sales process flowchart include establishing an initial contact or prospecting, pre approach that emphasises on planning the sale followed by the approach, needs assessment, presentation, meeting objections, gaining commitment and follow-up. The sales flowchart of Aldi will help the organisation to take into consideration the potential sales, appropriate strategies thereby, managing the account suitably. As a result, Aldi will be able to increase their sales accordingly and expand their business.
Apart from potential benefits, the sales flowchart of Aldi that emphasises on increasing the sales by taking into consideration the customers and methods of managing the account, there are some issues identified in the system. According to Valentin (2014), one of the major challenges in developing the sales flowchart is that the flowchart is developed by analysing the previous sales reports of the company. For example, the marketing department of Aldi will analyse the previous sales records thereby, estimating the sales for the present year. This is challenging as the rate of sales might differ from year to year. As commented by Connors, Li & Natarajan (2013), the current expectations and demands of the customers are not possible to analyse as the organisation functions at different locations. Therefore, the potential customers of the company might not demand the products sold at one location thereby, hampering the sales.
The estimated sales of the company need to be stated after evaluating the financial records the company for the past 5 years. Therefore, Aldi will be able to consider all difficulties of the company and develop recovery strategies accordingly.
As commented by Lim (2013), accounting software is important for business organisations as recording and conduction of the sales needs to be performed appropriately. Aldi is a leading grocery store across Australia and having stores across 45 countries uses POS software as their accounting software. According to MacPhail & Russ (2012), POS is defined as the point of sale considering the time and place of the retail transaction. According to the working principle of the software, the staffs at the grocery store calculate the amount owned by the customer thereby, indicating the amount to the intended customer. This is followed by generating the invoice and asking the customer the feasible mode of payment. Post transaction, the merchant provides a receipt stating the details of the transaction. As mentioned by Hall (2012), the merchant uses aids such as barcode scanners, cash registers and weighing scales before initiating the POS software.
The various features included by the POS software are warehousing, financials, inventory management and customer relationship management. POS software is also recommended as a point of return; the customers to the company use the software for both purchase and return of products.
As commented by Wolfe (2013), the current marketing size of POS software in Australia is huge as it is one of non-cash payment countries in the world. Implementation of POS software helps in the non-cash transaction as debit or credit cards do the transactions. Aldi also uses POS software within their grocery chain as this implementation of the software makes the transaction easy and convenient. According to Bhinder (2012), retail and grocery business organisations are increasingly adopting POS software. This is because POS software does away with the needs of price tags. As a result, the selling price of the product is linked directly with the code of the product making it easy to determine. Therefore, the staffs of Aldi do not require scanning the code of the product for processing the sale.
At certain instances, if the price of the product is altered, the change in the price of the product can be easily made through the inventory window. Moreover, other beneficial features of the POS software includes implementation of discounts easily, efficiently controlling stock and maintaining loyalty scheme for their potential customers. Due to the variety of reasons, POS software is extensively used Australia thereby, having a huge current share.
The big and small businesses of the Australian market are adopting accounting software at a faster pace due to coping up with the increasing purchasing demand of the customers. As commented by Pan & Perera (2012), the leading accounting software in Australian market is Xero, Intuit and MYOB. The accounting software market is completely captured by this accounting software. Xero emphasises on the cloud computing software and has the biggest share of the accounting software of Australia. The model software used by Xero is software as a service (SaaS). As a result, Xero has the ability to provide free API to the third party customers and vendors thereby, incorporating other applications on a single unified ledger in the cloud. SaaS provides an opportunity for the customers to operate within a cloud structure or through a thin user interface. Xero has brought innovative and has been proved time efficient while handling the increasing purchasing demand of the customers. Therefore, it is easy for the grocery chain business to handle customers effectively.
In spite of several advantages, the accounting software has distinctive gaps and challenges that make it difficult to implement. One of the major disadvantages of accounting software is that the departments of the business organisations are not autonomous units. Moreover, due to incompatible duplication and formats, desktop accounting software is unable to tackle the accounts of various departments of the organisations. As a result, the compilation of the financial reports become time-consuming and tedious highlights various errors and inconsistency. Furthermore, accounting software accessed through cloud computing system lacks security. As the cloud computing system of the accounting software is accessible to everyone, the securities of the accounting software are comparatively less. Therefore, the information related to the accounts and finance of the business organisations are vulnerable to misuse. Therefore, lack of security needs to be considered to keep financial information of the business organisation safe and sound. This will decrease the errors and efficiency in the accounting software system.
Based on the current challenges in the accounting software of the business organisations, the security issues of the accounting software need to be mitigated. The security of the accounting system can be decreased extensively by implementing the process of encryption. Encryptions will help in covering up information with specific codes. As a result, it will be time-consuming for the hackers to decode the encryption in order to get hold of the information. Moreover, in order to make the security more effective, the number of encryptions can be increased. Therefore, decoding the number of encryptions for getting access to particular information will be difficult. This will provide ample amount of time for the business organisation protect the financial information of the company.
In order to identify the foreign users, a system termed as IDM needs to be implemented to carry out the authentication of the service. These characteristics of the IDM highlights conducting authentication of the services performed in the accounting software service.
Conclusion
In this report, it can be concluded that accounting software plays a significant role in managing and recording the financial resources of a business organisation. Aldi is a chain of the grocery store in Australia uses decentralised organisational structure due to which the organisation has to face various benefits and challenges. As Aldi generally deals with selling of products to the customers, POS software is the most effective software for the company. Apart from POS software, other leading accounting software in Australia are Xero, MYOB and Intuit, that are generally adopted by both small and medium sized business organisations. This accounting software makes managing of the accounting aspects of the organisation less tedious and time-efficient. However, lack of security is a major disadvantage for accounting software, as they are managed through cloud computing software such as SaaS. The security can be increased by ensuring encryption in the accounting software.
References
Sales Process Flowchart. (2017). https://www.conceptdraw.com. Retrieved 29 May 2017, from https://www.conceptdraw.com/How-To-Guide/sales-process-flowchart
ALDI Australia. (2017). ALDI. Retrieved 29 May 2017, from https://www.aldisuppliers.com.au/PDF/ALDI-Corporate-Brochure.pdf
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