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Organizational background

Discuss About The Global Information Technology Environment.

Information system helps in maintain various types of organization goals and objectives by providing excellent services to the customers in the market. This type of services and strategies s known as strategic information system (Haux et al. 2013). Various advantages are included with the use of the strategic information systems including the competitive advantage provide by the systems in the market. These systems helps in maintaining and monitoring the delivery of products and services on time. This system also help in maintaining the price and cist if the products and services in the market. However, this type of system is responsible for helping in categorizing, string and transferring of data and information. The use of various software in the system helps in maintaining the technical aspect if the system. Accounting software refers to an application that helps in recording and processing financial transaction of the company in the market. This software helps in providing extra benefit to the company in the market related to the financial increment (Galliers and Leidner 2014). However, this accounting software can be access from anywhere with any kind of electronic device connected with internet.

This report helps in providing a brief introduction to the strategic information system and benefits if accounting software in banking sectors of Australia including the Commonwealth bank of Australia. This report outlines various problems prevailing in the structure of the organization and helps in minimizing the problems. The system efficiency method, system flowchart and the various control problems of the organization will be given here. The relevant accounting software package for CBA will be highlighted here.

Commonwealth Bank of Australia is one of the most popular bank in Australia and in all over the world. It has many multinationals branches all over the world. This bank has been operating in Asia, Europe and Australia. Therefore it has a large business network in the global market. This bank has been responsible for providing banking services in all over the Australia. The bank has been providing loans and other financial help to the citizens of the country (Willcocks 2013). In 2015, CBA has been listed as the largest bank in Australia Australia in the Australian Securities Exchange with other brands like Bank west, ASB Bank and Commonwealth Securities. Commonwealth Bank of Australia is one of the four banks with Westpac, ANZ and NAB (Commbank.com.au. 2018). This organization has been helps in the maintaining the revenue system of the country. The GDP of the country have been maintained with the help of the bank by providing loan to various people in the country.

Organizational Structure of Commonwealth Bank of Australia

The structure of the organization has been popular and precious for the organization. This structure include various managing bodies and employees of the bank. The board members include directors and board of commissioners of the organization including the directors, owners and other stakeholders. There are three levels of management including top, middle and lower management level.

Figure 1: Organizational Structure of Commonwealth Bank of Australia

(Source: Commbank.com.au. 2018)

Commonwealth Bank is one of the largest bank in the country. However, there are some major operational problems in the organization related to the structure. These problems have been affecting the shares of the company in the market. The shares of the company has been decreasing in the market that has been creating a bad impact in the profit of the company (Dandago and Rufai 2014). Various operational problems have been identified in last five years. This have been occurring due to the wrong strategic decisions taken by the management of the company. The approaches of the stakeholders in the market have been wrong by the time. The use of the strategic decision making stare have e failure in the market. The fore, the company have been running in a loss for few years. The trends in the market have been changing over the times with the change in strategy of the company. The competitive advantage of the company have been decreasing in the market (Commbank.com.au. 2018).  The entry of various competitive on the marketed have been creating problem for the bank in the market. This bank has been continues failing in meeting the expectations of the customers in the market. The customer satisfaction level with this company has been low in ten arte.

 Another problem has been identifier in the bank that they were nit making enough money. The money taken by the customers have not been well invested in the market. This has been creating problem in many making process from the market. The popularity of the bank has been becoming low in the market that has been decreasing the brand value of the company in the market. The popularity if the bank has been decreasing in the bank as was using old fashion marketing policies (Palvia and Palvia 2013). The CBA is a traditional bank use tradition strategic information system and old software technology. Therefore, the bank has not been able to cope up with the drastic changes in the market. It lacks in maintaining the organizational structure if the company. The distribution of roles and responsibility have been irregularly distributed in the organization. The budget system of the company has been lacking using modern technology for minimizing the complexity of the system in the market.

Operational Problems of Commonwealth Bank of Australia

Figure 2: Downfall of Share Price in Commonwealth Bank of Australia

(Source: Commbank.com.au. 2018)

The above figure describes about the downfall of the share price of the bank in the market. In the above figure, during the period of June and July 2013, the share price has gone up to 70%, however, recently, it has gone down to below 20%.  

There are various operational strategies that might help in minimizing the problems in the CBA. Four of them has been discussed below:

Customer: This is the first strategy for the CBA Bank. Customers are the most important asset for the company in the market. Therefore, the satisfaction of the customers in the market is an important point for the development of the company in the market (Ogiela 2015). The culture of the bank has been modified in maintaining the expectations of the customers in the market. The diversification of the money in the market has been properly maintained by monitoring the activities of the customers.

Technology: The second strategy of the Commonwealth bank is technology. Technology plays an important role in maintaining the development to the company in the market. However, CBA have been using low technology in their system. Hence, they are facing some problems eth the new entrants in the market as they are using upgraded technology in the market. The Commonwealth bank has been trying to upgrade their technology used in the operational system.

Productivity: The third strategy of the Commonwealth bank is productivity. The productivity of the bank has been more than that other banks in Australia (Laudon and Laudon 2016). The company is simplifying the method of production in the market. The use if the various strategies in the market for the increasing the reduction have been introduced by the company. Productivity of the company has always been focusing on the demand of the customers in the market. However, thus has been a very critical situation for the company to maintain the productivity in the market.

Strength: The last strategy of the Commonwealth Bank is strength. The financial crisis of the CBA has been trying to overcome from various downfall and combining their strengths to bounce back in the market (Arvidsson, Holmström and Lyytinen 2014). The balance between the external and internal factors affecting the development of the company in the market has been analyzed. The use of the balance sheet might help in maintaining the budget of the bank and capitalize various opportunities in the market.

Organizational Strategies

Figure 3: CBA Strategies

(Source: Created by the Author in MS Doc)

Enterprise Resource Planning or ERP has been implemented by the Commonwealth Bank of Australia for the system acquisition method. As commented by Konsynski and Karimi (2013), ERP refers to the process by which an organization maintains and controls various fields including planning, finance, purchasing and marketing. The organizational goals have been properly planned and analyzed for the completion of the goals in time. The use of system acquisition method in the bank might help in monitoring various assets. Commonwealth bank used to utilize SAP model for managing their business. As argued by Hill, Jones and Schilling (2014), implementation the SAP model in an organization is not an easy task as it requires proper training and expertise. SAP model helps in providing flexibility to the operational systems used in the bank. However, it helps in providing various opportunities to the company in the market. The use of the SAP model helps in identifying the cost effectiveness strategy in the company. The cost effective products and services of the company helps in attracting the customers in the bank. The use of the SAP model have helped in providing proper market analysis including the amount of increase in the market. It is even utilized by the bank for making the bank shares absolutely steady and working (Amrollahi, Ghapanchi and Talaei-Khoei 2013). If the interest rates of the bank would be reduced, then the customers would again take loans from CBA.

Figure 4: Systems Flowchart of CBA

(Source: Commbank.com.au. 2018)

There have been various problems faced by the Commonwealth bank in the market. Therefore, there is a need of various modification in order to growth in the company in the market. The value of shares of the company has been decreasing in the market. Thus has been a major problem fir the bank in the market. The stakeholders of the company have not been able to maintain the decision-making system of the bank. The control problems of the organization have been responsible for the decrement of the growth of the company.

There are several types of frauds happening in the Commonwealth Bank of Australia. The first and the foremost fraud of this organization mainly include the hoax emails or the hoax SMS messages (Arvidsson, Holmström and Lyytinen 2014). The other fraud of the bank includes phishing and spoofing. Smashing is the most popular form of phishing and SMS

  The accounting software solutions are mainly required for processing and keeping record of different transactions using different modules such as payroll, trail balance, accounts payable, accounts receivable, general ledger, billing of the sales etc.  These kind of software solutions are available from different third party vendors or can be developed in-house by the organization as per the tailored requirements of the organization (Bryson 2017).

  In Australia there are numerous accounting software packages are available such as MYOB, Xero, Reckon etc. Among them, CBA collaborated with the Xero in order to provide, launch the first of its kind a secure data feed solution that will be used for small businesses that are the customers of the bank.   

  Xero provides cloud based solution for its customers in the SaaS based model. With the following advantages of the Xero, the Common wealth bank gets advantage in the market (Alexander 2013).

Handling many client requests in minimal processing time:  With the efficient modules of the accounting package, Xero is able to handle too many user requests in minimal amount of time.

Automation: For organizations like Commonwealth Bank simple maintenance of accounting transactions and basic financial reporting are not enough.  Thus the organization requires the complete automation of payrolls module, different other employee expenses as well time sheets. In addition to that, handling of the different purchase requisitions, departmental budgets and other complex financial activities are also available from Xero.

Interoperability:  For Commonwealth Bank, data entered into the software solution can be effectively used by numerous business applications used inside the organization and different business sectors (Amrollahi, Ghapanchi and Talaei-Khoei 2013). Conversely, it may be required that the software solution is able to draw information from other software solution/products from different other departments of the organization. Therefore, this increases the efficiency of the different business processes in the organization by providing interoperability with other software solutions. Use of Xero in providing the banking services to the SSME   helped the organization to acquire new customers as it made the banking process much easier (Yoo 2013).  With this integration the customers will be able to resolve their banking transactions inevitably, and get an up-to-date view of their cash flow in the go.

Market Size:  Following bar chart shows the degradation of market share in Australia.

Figure 5: Commonwealth Bank of Australia Share Margin

(Source: Commbank.com.au. 2018)

Competitors and market leaders:

 There are numerous banks that are the core competitors in the banking sector of Australia.  Some of the most significant competitors of Commonwealth Bank are listed below,

Australia and New Zealand Banking Group or ANZ Bank

National Australian Bank or NAB

Bank West

St. George Bank, Australia

Kiwi Bank

Auckland Savings Bank or ASB

Figure:  Competitors of Commonwealth Bank of Australia

(Source: Commbank.com.au. 2018)

From the above chart it is evident that that the Commonwealth Bank is Australia is still leading in the banking sector of Australia. 20% of the total share is acquired by Commonwealth Bank, 16% by National Australian Bank, 13% by National Australian Bank (Gholami et al. 2013).

Commonwealth Bank of Australia has been facing a variety of organizational and operational challenges in their system. However, the most usual issue in the Commonwealth bank of Australia have been the hike in the interest rates than that of other banks. Therefore, customers are not willing to invest their money with tis bank. It is highly recommended to reduce the interest rates of the bank in order to attract more customers to the bank. The interest rates on the loan of the people needs to be low s that the number of loan get increased in the banks. The second issue in the bank is that the customers are not willing to invest in the bank. Therefore, it is recommended that the bank needs to increase the share in the market (Youn et al. 2013). The customer relationship management has been a problem for the bank in the market. The level of satisfaction has not been improved by the quantity of services provided by the bank. Therefore, it is recommended to invest in the CRM model of the company.

Conclusion

It is concluded that the strategic information system have helped in maintaining the organizational goals and objectives. The use of strategic information system have helped in minimizing the problems in the organizational goals of the Commonwealth Bank of Australia. Accounting software implementation has been discussed in the report.  The use of the SAP model has been explained in the report. The importance of the SP model has been discussed in the report. Some recommendations have been provided for minimizing the issues in the CBA.

References

Alexander, K. ed., 2013. Facilities management: theory and practice. Routledge.

Al-Hiyari, A., AL-Mashre, M.H.H. and Mat, N.K.N., 2013. Factors that affect accounting information system implementation and accounting information quality: A survey in University Utara Malaysia. American Journal of Economics, 3(1), pp.27-31.

Amrollahi, A., Ghapanchi, A.H. and Talaei-Khoei, A., 2013. A systematic literature review on strategic information systems planning: Insights from the past decade. Verified OK.

Arvidsson, V., Holmström, J. and Lyytinen, K., 2014. Information systems use as strategy practice: A multi-dimensional view of strategic information system implementation and use. The Journal of Strategic Information Systems, 23(1), pp.45-61.

Bryson, J., 2017. Effective library and information centre management. Routledge.

Commbank.com.au. 2018. Personal banking including accounts, credit cards and home loans - CommBank. [online] Available at: https://www.commbank.com.au/ [Accessed 13 Apr. 2018].

Dandago, K.I. and Rufai, A.S., 2014. Information technology and accounting information system in the Nigerian banking industry. Asian Economic and Financial Review, 4(5), pp.655-670.

Galliers, R.D. and Leidner, D.E. eds., 2014. Strategic information management: challenges and strategies in managing information systems. Routledge.

Gholami, R., Sulaiman, A.B., Ramayah, T. and Molla, A., 2013. Senior managers’ perception on green information systems (IS) adoption and environmental performance: Results from a field survey. Information & Management, 50(7), pp.431-438.

Haux, R., Winter, A., Ammenwerth, E. and Brigl, B., 2013. Strategic information management in hospitals: an introduction to hospital information systems. Springer Science & Business Media.

Hill, C.W., Jones, G.R. and Schilling, M.A., 2014. Strategic management: theory: an integrated approach. Cengage Learning.

Konsynski, B.R. and Karimi, J., 2013. The Information Technology and Management Infrastructure Strategy Globalization and information management strategies. In Strategic Information Management (pp. 103-126). Routledge.

Laudon, K.C. and Laudon, J.P., 2016. Management information system. Pearson Education India.

Ogiela, L., 2015. Advanced techniques for knowledge management and access to strategic information. International Journal of Information Management, 35(2), pp.154-159.

Palvia, P.C. and Palvia, S.C., 2013. Understanding the global information technology environment: representative world issues. Strategic Information Management, p.151.

Simkin, M.G., Norman, C.S. and Rose, J.M., 2014. Core concepts of accounting information systems. John Wiley & Sons.

Willcocks, L., 2013. Information management: the evaluation of information systems investments. Springer.

Xero Accounting Software. 2018. Online Accounting Software – Free Trial, Free Support | Xero. [online] Available at: https://www.xero.com/  [Accessed 13 Apr. 2018].

Yoo, Y., 2013. The tables have turned: How can the information systems field contribute to technology and innovation management research?. Journal of the Association for Information Systems, 14(5), p.227.

Youn, S., Yang, M.G.M., Hong, P. and Park, K., 2013. Strategic supply chain partnership, environmental supply chain management practices, and performance outcomes: an empirical study of Korean firms. Journal of Cleaner Production, 56, pp.121-130.

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