In today’s era, every industry and business utilizes information technology in its day to day activities. The positive effects of technology adoption can be utilized by small business but they lack the requisite expertise and resources that are possessed by large corporations for the purpose of implementing the information technology strategies.
A Point- of- Sale system combines hardware and software for the purpose of allowing the merchants to undertake various transactions thereby simplifying the day to day operations of the business (Guinn, 2018). The implementation of POS system is useful in the organization as it allows the users to track important business data from the transactions of sales instantly at the time of sale thereby abolishing the requirement of manual tracking of sales. This report focuses on the adoption of POS system by Four Seasons Greenhouse and Nursery and the benefits derived from the system.
Various advantages and disadvantages are associated with the use of POS systems in Four Seasons Greenhouse and Nursery.
Advantages of POS System
Decision Making- POS system helps in maintaining accurate data which in turn helps in decision making by identifying the highly profitable items and shifting the production process to it for gaining more profits. Moreover, the order quantity is now based on the current inventory units rather than speculation (McCarthy, 2018).
Delegation of responsibility and establishment of accountability- POS system allows the owners to make the delegation of responsibility to the staff along with the establishment of requisite accountability (Sugar, 2015). The owners do not establish goals by themselves instead they provide the relevant data from the system to the staff and ask them for determining their sales goals for the upcoming period.
Tracking of Business Data- The tracking of data on manual basis is eliminated with the help of POS system as it facilitates the owner to track business data instantly from the sales transactions (Blokdijl, 2015). The system is responsible for the storage and processing of data relating to sales along with performing the function of keeping inventory up-to-date and compilation of sales history (Pharmacy Management, 2018).
Disadvantages of POS System
Security Risks- When a POS system is linked with a central network it faces a variety of security risks such as exposing of personal information of customers to other individuals. These risks may result from not updating the software on time (Turner & Weickgenannt, 2016).
Expensive Software Updates- Software is required to be updated on regular basis along with some updates in the hardware in order to ensure the smooth functioning of POS system. These updates require the payment to be made for new licenses each time (Hamilton, W. 2013).
Less convenience with software-based system- Software-based systems are less convenient to use than the web-based system. Software-based system requires more than the computer for accessing reports and inventory counts with a software-based system.
POS system assists in gaining competitive advantage along with efficiency in the business operations (Griff, 2014). It helps in taking full advantage of the business data for the benefits of the business by providing important information regarding the profitability of the products. It also provides detailed knowledge relating to costs associated with the items which helps in analyzing the products which are not as profitable as anticipated. Therefore, it assists in shifting the production to highly profitable products which in turn brings increased profits for the organization. Moreover, the business operations are effectively managed with the help of on time reporting of accurate information facilitated by POS system (Stamell, 2007).
The following advantages are offered by a centralized database.
Before the POS system, the decisions regarding the number of units to be ordered were made on the basis of speculation linked with existing units of inventory. Accurate data is maintained by POS system with respect to the inventories therefore, decision making regarding the number of units to be ordered is facilitated on the basis of accurate data.
Effective processing of business activities
The instant tracking of the sales transaction at the time of sale helps in the effective processing of the business activities by POS system (Reilly, 2016). Moreover, processes like sales history compilation and inventory updating are performed simultaneously which contributes towards the effective processing of business activities.
Ineffective Manual Tracking
Manual tracking of information is ineffective due to the fact that operational data cannot be accessed properly which forms the basic requirement behind the management of business in an effective manner. Cost reporting cannot be performed with manual tracking and therefore the profitability of individual items cannot be identified.
Effective Answers to various questions
Various questions are effectively answered with the help of POS system such as accurate number of inventory in order to avoid the guesswork regarding the order quantity. It also effectively answers other questions regarding the quantity to be ordered, sold and rejected.
Better management of business through the use of information
The data processed and stored by POS system can be utilized for the effective management of the business operations by making decisions regarding the accurate inventory required to be ordered. The information derived from the POS system by input, tracking and distribution of data will help in identifying the mistakes in operations and support smooth functioning of the business.
Types of Networks- The network can be established in the form LAN, WAN or MAN. However, the recommended network is LAN (Local Network Network) due to its suitability for holding all sorts of needed setting and records for a Point-of-Sale system as it is built as a centralized database server. Since Four Seasons Greenhouse and Nursery is a small business, LAN is sufficient for meeting all its requirements and there is no need for WAN. LAN setup supports multiple POS terminals. The configuration of all such terminals is made in order to enable it to access same database server.
Types of Media- The adoption of wireless technologies should be made in the form of wireless LAN. It will require the setting up of wireless LAN for the POS system. The communication is made by the terminals in encrypted form with the security standard WPA2. Wireless LAN can use wireless technologies such as spread spectrum, narrowband microwave and infrared.
Risks of security, privacy and confidentiality of data are suffered by the POS system
Security- The data in the POS system is compromised in cases when older operating systems are utilized for the system and when there is no extended support. Sometimes fraudulent POS systems put the data of the company and the customers in risks by providing access of such data to the hackers. Hackers also undertake practices like phishing and skimming for gaining access to the personal information stored on the POS device.
Security of the system can be protected installing anti-virus software in order to save the data against the activities of hackers. Moreover, changes must be made to the default password for the security of the data. In cases where a third party vendor maintains the system, a strong policy must be formulated regarding the passwords.
Privacy- The hackers may use the personal information stored on the POS systems such as the name, credit card information, birthday, address, city, etc. by using spyware and server hacks for their own benefits (Gomzin, 2014). But this significantly affects the privacy of the data of companies and customers.
A security protocol can be generated within the organization and the employees must be trained accordingly to follow such protocol. The use of multi-biometric systems can be made for ensuring the privacy of the users. Moreover, the POS system must be updated on regular basis to facilitate new options for protecting the privacy of the data (Martinez, 2016).
Confidentiality- When a person who is not authorized to access a given data views it, the confidentiality of the data is said to be breached. Various confidentiality breaches which resulted in the past has serious impact on the customers.
With the emerging technology, new software has been developed for the protection of confidential data from various threats (Symantec, 2018). This software also protects the data and machines from external threats and malware and provides consistent VPN connectivity.
Conclusion
This report assists in coming to a conclusion that garden centre has effectively utilized technology for the efficient functioning of its business operations. This system allowed garden centre to improve competitive advantage and operational efficiency with the help of appropriate decision making which has significantly improved the profits of the organization due to shifting of their focus on the profitable items.
The privacy, security and confidentiality of data can be protected by garden centre by regularly updating the hardware and software. Moreover, some precautions are required to be made in terms of strong passwords of the system and proper installation of anti-virus software. The use of WAN can be made for linking the telecommunication network with the remote location.
References
Blokdijl, G. 2015. Point of Sale – Simple Steps to Win, Insights and Opportunities for Maxing Out Success. International MONETARY FUND.
Dontigney, E. 2018. The Advantages of Centralized Database Storage, [Online]. Available at: https://itstillworks.com/info-8623828-advantages-centralized-database-storage.html [Accessed on: 29 January 2018].
Gomzin, S. 2014. Hacking Point of Sale: Payment Application Secrets, Threats, and Solutions. John Wiley & Sons.
Griff, M. 2014. Professional Accounting Essays and Assignments. Lulu Press, Inc.
Guinn, J. 2018. What Is a Point of Sale System?, [Online]. Available at: https://www.softwareadvice.com/resources/what-is-a-point-of-sale-system/ [Accessed on: 29 January 2018].
Hamilton, W. 2013. The Key Disadvantages Of POS Systems, [Online]. Available at: https://nationalprocessing.com/blog/key-disadvantages-pos-systems/ [Accessed on: 29 January 2018].
Martinez, J. 2016. 6 Steps to Securing Your Point-of-Sale System, [Online]. Available at: https://in.pcmag.com/apple-ipad-pro-97-inch/105528/feature/6-steps-to-securing-your-point-of-sale-system [Accessed on: 29 January 2018].
McCarthy, M. 2018. The Benefits of Moving to a Point-of-Sale (POS) System, [Online]. Available at: https://www.allbusiness.com/the-benefits-of-moving-to-a-point-of-sale-pos-system-10206841-1.html [Accessed on: 29 January 2018].
Pharmacy Management. 2018. Six Major Benefits of Point of Sale Systems, [Online]. Available at: https://www.pharmamanage.gr/en/e-business/413-six-major-benefits-of-point-of-sale-systems [Accessed on: 29 January 2018].
Reilly, J.C. 2016. An Overview of Point of Sale Systems. CreateSpace Independent Publishing Platform.
Stamell, G. 2007. Macquarie Guide: HSC Information Processes & Technology. Macmillan Education AU.
Sugar, S. 2015. Top 5 Advantages of Retail POS Systems. [Online]. Available at: https://www.shopkeep.com/blog/top-5-advantages-of-retail-pos-systems#step-1 [Accessed on: 29 January 2018].
Symantec. 2018. Secure Your Point-of-Sale System, [Online]. Available at: https://www.symantec.com/en/uk/page.jsp?id=secure-your-point-of-sale-system [Accessed on: 29 January 2018].
Turner, L. and Weickgenannt, A.B. 2016. Accounting Information Systems: The Processes and Controls. John Wiley & Sons.
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