Use of information system in different business organization has increased over the years. The choice of information system depends on the need of the organization. Technology plays an important role in increasing the efficiency of the information system that is used in the organization (Sako, 2012). The need of the information system is equally important in both small and large enterprises. However, large organizations have resources and adequate human labour to easily implement an information system in the organization. This might be a problem for small enterprises mainly due to monetary issues lack of human labour. The report discusses the case of Four Seasons Greenhouse and nursery which made use of a point of sales system in order to address the different operational issues persisting in the organization along with the organizational losses. The problems that were persisting in the organization were mainly due to the use of manual registers. In order to evaluate the issues associated with the organization, the advantages and disadvantages of using a point of sales (POS) system is evaluated in the report. The report gives an idea of the advantages of use of a centralized database and risks that are associated with the use of a point of sales system. The process by which the use of PO facilitates decision making in the organization is discussed in the following paragraphs.
Four Seasons Greenhouse and nursery could achieve a number a huge benefit with the implementation of the POS system. However, there are certain issues associated with the use of such information systems that are needed to be analysed. The positive impacts of the use of point of sales system in Four Seasons are discussed below.
- The point of sale system has considerably helped the Four Seasons greenhouse and nursery in increasing the efficiency of the business processes of the nursery. The efficiency of the business processes increase since the management can directly deal with the customers that increase the efficiency of the customer’s services as well.
- The traditional register system that was used by the Four Seasons was time consuming and prone to human errors (Bharadwaj et al., 2013). With the use of the new point of sales system, the nursery could eliminate in inefficiencies and errors from the system by automating the entire business process and in turn saving a lot of time.
- Accurate report generation is another advantage that the nursery could avail with the implementation of the POS system.
- The point of sales system enhanced the process of employee tracking as with the help of the POS, the management could have a complete control of the employee schedule. This helps in easy allocation of the labour expenses by delegating more responsibilities to the staffs.
- Although the initial investment cost of implementation of a new point of sales system is quite high, it helps in maintaining the price consistency of the operations in the business.
- Another significant advantage of using a point of sale system is that the live reports generated helps in effective decision making.
The above discussed points give an idea of the different advantages associated with the use of a POS system; however, there are certain issues associated with the system which is listed below.
- The connection reliability nature of the POS system is a significant disadvantage. A continuous reliable connection is required in order to maintain a web based POS system.
- The associated software upgrades with the point of sales system is quite high and it is a significant disadvantage of using a point of sales system.
- The cost of development and implementation of a point of sale system is very high for a small sized enterprise like Four Seasons.
The above discussed points provide an idea of the significant disadvantages associated with a point of sales system.
The use of information systems like POS is increasing over the years mainly because it helps a business enterprise in gaining a competitive advantage. The process by which the a business can gain competitive advantage in the market are as follows (McDonald & Rowsell-Jones, 2012)-
- With the help of the POS system, the productivity of the staffs of the organization increases considerably. This is possible as a lot of time is saved with the elimination of the need of maintaining a manual labour. The increase in the efficiency of the labours helps the organization in gaining a competitive advantage.
- The point of sales system helps the management and the owners in keeping a track of the actual cost of the products that helps the organization in gaining a competitive advantage.
- With the point of sales system, asset management becomes easier and tracking the inventory data becomes easier as well (Baden-Fuller & Haefliger, 2013). This helps the organization in gaining a competitive advantage in the market.
- The enhanced and accurate decision making that is possible with the help of a new point of sale system helps the organization in gaining a competitive advantage.
The above discussed points prove an idea about the process by which the use of a POS system can help an organization in gaining a competitive advantage.
Centralized Database Advantage
The point of sales system that is implemented in Four Seasons is making use of a centralized database mainly because of a number of benefits that is offered by a centralized database system. The advantages of using a centralized database system are as follows (Osman & Knottenbelt, 2012)-
- The data preservation is one of the significant advantages of using a point of sales system. The feature of regular data backup helps in easier disaster recovery which is one of the most important components of business continuity plan (Coronel & Morris, 2016). Therefore, accurate data preservation is a significant advantage of making use of a centralized database system.
- The data security is increased with the use of a centralized database system. With the use of centralized database, sensitive and the confidential information can be easily stored by enforcing virtual private networks, firewalls and strong password protection in the data.
- The cost of deployment and maintenance of a centralized database is quite low in comparison to the decentralized database, which is a significant advantage of using a centralized database system.
- The speed of data processing and reliability of the data increases with the use of a centralized database.
The above discussed points provide an idea of the major advantages that is offered by the use of a centralized database system.
Effective decision making is one of the significant advantages of use of a point of sales system. The live data tracking and generation of live reports considerably helps the management in taking crucial decisions quite accurately. The process by which the use of POS can increase the accuracy of the decision making process are as follows.
- The point of sales system by providing a detailed record of the different operations running within the organization including the sales, inventory units and details of the purchase. These details help in easier management of the different business operations of the organization. The detailed analysis of the expected sales and the profit obtained helps in taking business decisions more effectively.
- The point of sales system that is used in Four Seasons automates the process of information tracking by providing continuous updates of the sales and purchases. The effective tracking of the information is possible with the use of the POS system, which were earlier not possible as information tracking in a manual manner is a time consuming task and the data obtained from the manual records might contain redundant data set. The effective information tracking helps in easier decision making as well (refer to appendix).
- The data obtained from the point of sales system can provide effective answers to the questions that are associated with the number of sales per day, the inventory units and the purchases that are to be made in the organization. These answers help an organization in effective decision making.
- The information that is obtained from the new point of sale system helps in management of the business in a more appropriate way. The detailed information about the inventory units helps the nursery in operating in a leaner inventory unit, which in turn increases the profit margins. Furthermore, the knowledge about the actual cost of the data helps in accurate costing of the products so that the business can gain a maximum profit. The decisions about the costing, products and the employees could now be taken in an effective manner with the help of the new point of sale system.
It is important to identify which telecommunication system will be best to consider for the said POS system. The types of network that are mainly used in integration of the new POS system are Local Area Network (LAN), Wide Area Network (WAN) and Metropolitan Area Network (MAN). The network type for the particular POS that is implemented in Four Seasons is needed to be evaluated. For this POS, the LAN will be appropriate since the Four Seasons is a small sized nursery (Wang et al., 2015). WAN and MAN is mainly used when the digital devices that are scattered over a large geographical area in needed to be interconnected.
A wireless technology is recommended for Four Seasons as it will help in easier access of the data of the organization (Koenig et al., 2013). Wireless technology is much easier to implement in comparison to a wired technology and provides a cost effective solution as well (Diallo, Rodrigues & Sene, 2012). The use of wireless technology is associated with a number of data security risks that are needed to be mitigated (Arnon et al., 2012).
There are a number of risks associated with the storage and access of data from the implemented point of sales system. The issues are mainly associated with the security, privacy and the confidentiality of the data (Chen & Zhao, 2012). The stored data is associated with the risks of data breach and therefore proper data protection is needed to be enforced. Therefore, it is recommended for the Four Seasons to use advanced encryption technologies for secure data storage. Access control can reduced unauthorized data access as well.
The report establishes a need of implementation of information systems in business organizations. The report considers the case of Four Seasons nursery where the use of a point of sales system have helped the organization in gaining a number of benefits in business including the increase in the competitive advantages of the business. The report further discusses the issues associated with the use of point of sales system that includes the data security risks as well. In order to address the data security risks, it is recommended that the organization should enforce proper access control and encryption for secure data storage.
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