Accounting Infomation System for Ready To Eat - Term Paper Example

Title Page INFORMATION SYSTEMS FOR RTE Name Student Number Course Code and Title Date due Executive Summary The purpose of this report is to evaluate the IT requirements of Ready To Eat which is a business that is located in the coastal town of Yowie. The report first states the scope in the introduction giving an overview of what it contains. The next section is the discussion section that forms the core of the report. This section is divided into subtopics each tackling a relevant issue in forming a basis for the RTE information system. Some of the topics covered at a glance include the benefits of IS in business, what IS are, the security and ethical challenges, the management challenges likely to be faced, and the information system needs area in the context of RTE among others. The next section then concludes the report giving a rough summary of its contents. The last section then offers recommendations to RTE from the stand point of the report. Table of Contents Title Page 1 Executive Summary 2 Table of Contents 3 4 Introduction 4 Discussion 4 Information systems 4 1.1Benefits of Information Systems on Business 4 1.2Best Information Systems for RTE 5 3.Porter’s Competitive Force Model for RTE’s Information Systems 5 4. Information Requirements of RTE and Processes that should be computerized 6 6. Management Challenges likely to affect Organizational change when Implementing Information Systems in RTE 7 7. Security and Ethical Issues with the Introduction of Information Systems to Business 7 Conclusion 8 References 9 Introduction The advancement in technology has made most business apply information systems in their operations so as to gain competitive advantage. There has been a remarkable application of information systems both in small scale businesses such as SMEs to multinational companies. This has been propagated by the mutual benefit the company gets from the information systems that are the arsenal of the contemporary business. Ready to Eat (RTE) is a sole proprietorship business run by Rebecca Smith as the manager. The business prepares and supplies pre-parked foods. Rebecca had been using essential business and productivity software to do most of the management operations such as keeping grip of customer’s and pricing information, wages, details of raw materials, packaging material, and book keeping. However, a challenge has presented itself in the form of a new entrant in the market that is threatening the existence and thus profitability of RTE. The purpose of this report is to offer advice based on a vast research on Information System, on the best IT system the company could acquire so as to optimize the management of the business and gain competitive advantage over the other regional company that is a new entrant into the market initially dominated by RTE. Discussion Information systems Information system refers to a set of interconnected entities or components that work in concert in order to facilitate the process of collection, processing, and recovery of data, distribution of information for the purpose of planning and decision making, control, collaboration, coordination, and analysis of the decision making process by management of the organization. This definition takes the concept of organization into place. Some of the information systems that have achieved wide application in business include management information systems, enterprise resource planning systems, and customer relationships management among others. 1.1 Benefits of Information Systems on Business There are a myriad of advantages that come in place with the application of information systems in business. The primary advantage of information systems lies in their ability to provide the user with information needed for variety of tasks effectively and efficiently (Grewal, Roggeveen, Compeau, & Levy, 2011). The information systems allow the management to research and strategically plan for the business (Gelinas & Dull, 2008). Through the automation of initially manual systems the business is able to increase its efficiency in customer service (De Queiroz, & Oliveira, 2014). The information systems also make it possible to store, retrieve and analyze vast array of data concerning the business such as supplier information, the raw materials and workers salaries among others in accurate and efficient manner (De Queiroz, & Oliveira, 2014). When using information system, a business is able to conduct real-time evaluations and make decisions (Gelinas & Dull, 2008). The information systems are adaptable and can be customized to fit the changes in business. Communication being one of the key operations in business is facilitated by information systems (Grewal, Roggeveen, Compeau, & Levy, 2011). This is mainly because there is real time processing of data into information that is tangible and applicable in daily business activities. This is efficient, accurate and fast compared to the manual paper systems that have been in business for quite a long time now (Gelinas & Dull, 2008). 1.2 Best Information Systems for RTE There are many types of business information systems. Assessing the case of RTE the best information systems the management could invest in include management information system, enterprise resource planning systems and customer relationships management system (Mishra, 2008). Enterprise resource planning management information system has the capability of handling planning purchase of raw materials and assets, inventory, sales, marketing, accounting, customer relations management, and human resource among others (Grabski, Leech, & Sangster, 2009). These ERP systems are integrated systems that are used to compile, organize and maintain data for daily operations (Mishra, 2008). This system will synchronize the departments at RTE from management to marketing all in one platform. Another important system that can be used is the management information system (Mishra, 2008). Management Information System (MIS) refers to a computerized system that has a database of organized financial information organized and programmed so as to report the operations for each level of management in the business (Grabski et al, 2009; (Zeng et al., 2012)). Through the use of MIS, RTE will be able to produce special reports that can be used to make an informed as is the case with ERP systems (Mishra, 2008). Information systems and Management Decision-making at RTE The aforementioned information systems will confer different advantages to the management of RTE. There will be better management of the resources that will help achieve depreciation, physical inventory and record maintenance. Secondly, the management will be able to have better inventory management especially when responding to the demand in a given targets (Grant, Hackney, & Edgar, 2010). Thirdly, the management of the increased workforce will be easy since all the allocation of duties will be scheduled real-time (Mancini, Vaassen, & Dameri, 2013). With regards to decision making, RTE management could use the information on customers to design effective marketing campaigns. Secondly, the management will be able improve on strategic planning so as to garner great market response (Mancini et al, 2013). Thirdly, the management will be able to improve the management decisions since there will be efficient resource management, efficient processes, and quick response in operational changes (Grewal et al, 2011). Based on the market statistics from the sales and customer data, the management is able to create new products and services after consulting with the customers (Mancini et al, 2013). The management can also make decisions on the needs of the human resource from gaps identified from the key-indicator reports. 3. Porter’s Competitive Force Model for RTE’s Information Systems RTEs information technology will make it difficult for the competitor to enter the market or industry (Gaines, Hoover, Foxx, & Morrison, 2011). This is because of lack of access to customer information that RTE already has grip of. The high cost of switching of the buyers will also act as a barrier to entry for the incoming competitor that happens to be a regional company (Gaines et al, 2011). With increased information through marketing campaigns and the presence in the market for a long time, RTE will be able to create more power for the buyers. This will mean less power on an individual buyer (Gaines et al, 2011). As a result of accessing many suppliers through the new system, their bargaining power will reduce. Since RTE will have a variety of information for its buyers, their bargaining power as well .The increase in switching costs however, will increase the supplier power. There will be more substitutes available in the internet when RTE revolutionizes its operations. Lastly, the rival is likely to acquire the same technology and thus create more rivalry (Gaines et al, 2011). The rival is also likely to have innovative systems that surpass that of RTE. This is mainly because the company is regional based. 4. Information Requirements of RTE and Processes that should be computerized The whole process of processing all deliveries should be computerized by introducing a system that will be able to automatically process all the orders real-time. RTE should also consider computerizing the process of managing the human resource that is both the kitchen staff and the delivery staff. The employees are stakeholders of the business and should be engaged through good management. The system will help the management of RTE to process wages and salaries in time, process all the sick leaves as well as schedule training if need be to fill the skills gap of the staff. With the computerization, the staffs are likely to have high engagement following the feeling of being part of the organization. This will authentically boost sales for RTE. The other processes that should be computerized include the customer data handling as well as relationship management. Customers form the key stakeholders of any business. With the computerization, the management of customer relationship based on their information will be able to help the management come up with standardized marketing campaigns targeting specific people such as email and database marketing. This will also help in organizing the orders in terms of distance and location so as to make quick and reliable deliveries. RTE should also consider computerizing all its inventories. All the meals variety should also be logged into a system and communicated effectively through networks to the consumers. The process of developing the meal varieties can also be automated such that the vast information on the worldwide web is incorporated into the business’ needs. Additionally, this will also aid in the management of pricing information based on the variety of meal thus the automation of the pricing information and the essential raw materials for each variety. The details of all the fruits and vegetables as well as other raw materials should also be computerized in a way that each supplier is mapped and ranked based on the efficiency and reliability. This will go a long way in maintaining the suppliers and building trust between the business and its suppliers who are also another bunch of important stakeholders. Lastly, the process of calculating the financial figures and invoices needs to be further computerized. This will help RTE in tracing its funds and could annually produce reports at the press of a key (Grewal et al., 2011). There will be efficiency at the end in the company. The problems that are currently in place can only be solved using a computerized system that takes care of all the aforementioned tasks. RTE should therefore consider investing in an ERP software and system that will centralize all the operations of the business for efficiency. 5. Role of Information Systems in Collaboration and Communication amongst Key Stakeholders of RTE Stakeholders are an important component of any business. This refers to people who have direct influence to the business and can be gained or easily lost through planning and programming process. There are internal and external stakeholders (Zeng, Lu, & Skibniewski, 2012). RTEs stakeholders include the customers, the employees, the management (who happens to be the investor-sole proprietor), the supply chain and the distributors (Stair & Reynolds, 2012). The company can leverage on information systems in communication and collaboration in all the business activities. A network, which is both intranets and extranets, will have a role to play. First off, the intranet will enable the coordination between the employees and the services at the workplace (Stair & Reynolds, 2012). The extranets will enable communication between the suppliers, customers and the management when there is need for quick decisions (Stair & Reynolds, 2012). The internet will be of use in communication and e-commerce (Stair & Reynolds, 2012). This will enable the customers to make decisions and orders that will be responded t effectively. The reports could also be disseminated to the suppliers (Stair & Reynolds, 2012). 6. Management Challenges likely to affect Organizational change when Implementing Information Systems in RTE There are many problems that affect the implementation of IT systems in organization. First and foremost, the business will have to train the stakeholders so that they are conversant with the new system (Pooley et al., 2013). Where the training is not out of an individuals will the stakeholders are highly likely to create some resistance to the change. This will impact the implementation process. The organization will have to implement the new information system parallel to the old system so as to allow time to transition (Grant et al, 2010). When doing this RTEs business is likely to be affected and would mean losing profit because the customers and other stakeholders will take time to integrate with the new system (Singh, Keil, & Kasi, 2009). The coordination between the employees will also be affected as they change from the ways to the new ways initiated by the system. The management will have to come up with written guidelines that are understandable so that each member is able to fit well when using the new system (Pooley et al., 2013). The cost of purchase and maintenance f the new system could be high such that some of it is passed down to the customers and employees. This will create resistance and possible loss of customers. There will also be issues in leadership. Because the sole proprietor can manage the business even when she is away, there will be the loss of the touch and relationship between the management and the workers as well as the stakeholders such as suppliers and employees (Singh et al., 2009). 7. Security and Ethical Issues with the Introduction of Information Systems to Business Security is a broad topic of discussion especially with the introduction of information systems. Security deals with making sure that data is protected from unauthorized access. There has been a case where data has been accessed and used for malicious purposes (Dark, 2011). Security and ethical concerns have been the arsenal f most information systems developers. Some of the security issues include sabotage and hacking of the systems by the competitors or people who want the data for malicious gains (Stair & Reynolds, 2012). Secondly, unsatisfied personnel are likely to breach the system and make it function incorrectly (Dark, 2011). This could be through malicious entry of data that cannot be detected since garbage in garbage out. Additionally, there is the threat of the hardware itself being stolen by people who want to frustrate the existence of the business. The system is also likely to face cases of fraud and impersonation especially where the suppliers or employees collude to promulgate fraud that can hamper the normal functioning of business (Tiwary, 2011). The competitors are also likely to steal data from the system through colluding with the employees and suppliers so as to gain competitive advantage over RTE (Stair & Reynolds, 2012). Ethics guards what is wrong from what is right (Tiwary, 2011). Some of the ethical issues include privacy. The data concerning the stakeholders could be used for the wrong purposes when they are accessed by unauthorized persons (Tiwary, 2011). Conclusion Information systems optimize business operations. The advancement of technology allows a company to tailor a system t its own use. RTE will be able to leverage on this in order to maximize its output and serve well all the stakeholders. The identified benefits that come with IS implementation, will in sum increase the productivity of RTE and thus make it have a competitive edge compared to the new entrant. There are implementation challenges as identified in the report that might be faced by the management. The management will also increase the accuracy and efficiency when making decisions in line with the business. With the implementation of the information system, the business will also have some ethical as well as security issues that accompany any information systems. However, the management could adopt some of the tested ways to curb the effects. The best system for the company that will combine all the information requirements identified will be ERP system that is readily available in the market. Recommendations The process of purchasing a system is very crucial and extra care should be taken. Firstly, RTEs management should first conduct an evaluation of the processes that needs t be computerized. This can be done by an IT specialist so as to know the requirement specifications that would be appropriate. Secondly, the management should come up with a strategy in consultation with system security specialist that would address the ethical and security challenges. Lastly, when purchasing the system future expansion considerations should also be put in place. References Dark, M. J. (2011). Information assurance and security ethics in complex systems: Interdisciplinary perspectives. Hershey, PA: Information Science Reference. De Queiroz, J. P., & Oliveira, B. (2014). Benefits of the Marketing Information Systems in the Clothing Retail Business. Journal of Information Systems and Technology Management (JISTEM), 11(1), 153-168. doi:10.1590/S1807-17752014000100009 Gaines, C., Hoover, D., Foxx, W., & Morrison, R. (2011). Information systems as a strategic partner in organizational performance. Journal of Management and Marketing Research, 1(1), 1-17. Gelinas, U. J., & Dull, R. B. (2008). Accounting information systems. Princeton, NJ: Recording for the Blind & Dyslexic. Grabski, S. V., Leech, S. A., & Sangster, A. (2009). Management accounting in enterprise resource planning systems. Oxford: CIMA. Grant, K., Hackney, R., & Edgar, D. (2010). Strategic information systems management. Andover: Cengage Learning. Grewal, D., Roggeveen, A. L., Compeau, L. D., & Levy, M. (2011). Evolving pricing practices: the role of new business. Journal of Product & Brand Management, 20(1), 510-513. Retrieved from http://dx.doi.org/10.1108/10610421111181813 Mancini, D., Vaassen, E. H., & Dameri, R. P. (2013). Accounting Information Systems for Decision Making. (Accounting Information Systems for Decision Making.) Berlin, Heidelberg: Springer. Mishra, A. (2008). Achieving Business Benefits from ERP Systems. Retrieved from http://www.researchgate.net/profile/Alok_Mishra5/publication/259486796_Achieving_Business_Benefits_from_ERP_Systems/links/0deec52c3122b5634e000000.pdf Pooley, R., Coady, J., Schneider, C., Linger, H., Barry, C., & Lang, M. (2013). Information Systems Development: Reflections, Challenges and New Directions. New York, NY. Rainer, R. K., & Cegielski, C. G. (2012). Introduction to information systems: Supporting and transforming business. Hoboken, NJ: Wiley. Singh, R., Keil, M., & Kasi, V. (2009). Identifying and overcoming the challenges of implementing a project management office. 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