Woolworths Organizational Structure
Woolworths is an Australian supermarket owned by Shop Direct Group and was founded in the year 1924. The marketed and supplied products of Woolworths include cosmetic and beauty products, clothing, electronics, furniture, housewares, jewellery, FMCG at lot more. The Woolworths manages and supplies trusted and recognised brands such as Freefrom, Macro, Fresh and Gold that deliver a world class experience to all levels of customers. Woolworths is the high-street retail chain that operates in more than 800 stores and has 111,000 employee working in the company. The structure provide a hierarchy where at the top is the Non-Executive Director, Chairman followed by the Group Managing Director and CEO. Under the CEO comes the Chief GM project Refresh Stage, Director of the Supermarkets, Chief Logistics, & Information Officer, GM Human Resources, Chief GM Freestanding Liquor & Petrol, Director General Merchandise GM Big W, Chief Financial Officer, GM Business Development, GM Mercury Program, GM Supermarket Operations, GM Corporate Services, GM Woolworths Academy, GM Big W, GM Property, and GM Dick Smith Electronics. The hierarchy structure has been shown in the figure below:
Figure 1: Woolworths Food Group Organization Structure
Source: Author
The position that Woolworths has achieved was dominated by the Australian government. They restricted Woolworth to keep the price of the product higher. The growth in the sales was very slow. The staff included in the structure are morally week. Currently Coles is the biggest rival of Woolworth (Woolworthsgroup.com.au., 2018). In the operation, the company has plan some strategies for growth. The product has to sell in less price, when the concern being share to the director of the supermarket still there was no response regarding the price issue. The production team were working on the matter of the price issue. Unfortunately, the external environment mostly affect in dominating the Australian retail market were the government of Australia has restricted the Woolworth to keep higher prices for their product in collaboration with the Coles. This has led to major weakness in the growth level of the company.
ERP is the is most likely system acquisition method that would be used for the organization. The entire organization need to plan to implement the ERP system. With the use of ERP system it is easy to understand and negotiate with the vendors about the requirements of the user based on their terms and conditions. The ERP acquisition process has four phases, the first phase begins with initiation, second phase with selection, third phase with final choice and the forth phase is negotiation.
Operational Problem with the Structure of the Organization
Figure 1: Sales Procedure System Flowchart
The flowchart shows the basic procedure of sales in the Woolworth supermarket. The customer takes the decision to pick or purchase the order, determine the quantity of the order, assemble the item. Once the item has selected it will assemble and the box and package will be done for the items after successful payment through credit, debit or net banking.
Figure 2: Integrated Sales Order Procedure
Source: Author
Figure 3: DFD of Sales Return Procedure
Based on the revenue cycle the activities of the sale procedure is shown in the diagram above. The cycle generate two revenue, Sales and Finance. The business activities perform in this cycle are basically
The problem in the ERP system is the inaccurate order of the customer, with poor credits the sales are done to the customers, the stocks are out, and cost in carrying.
Shipping Process: In the process of shipping errors occur and there is a chances that the order might be stolen by the inventory.
Billing Process: In the process of billing, errors may be found in the bill, customer would not be able to receive the bill. It may even happen that the user could not access the customer’s account properly.
Cash Collection: During the collection of the cash, there is a chances of losing data of the account due to some error. This can threaten the existence of the company and an inaccurate response to the customers enquires.
When the confidential information of the customer is disclosed, it dissatisfies the customers and the organization has to face loss of sales in the future. The customer does not come back to purchase any product from the organization because the relation with the customer has break and lead to legal sanctions and fines. This result in reduction of profit. It may even accidentally happen that the important data have got erase as the disks and tapes were not label properly. There are lots of sensitive data in the ERP system and users are allow to access the data encryption for transmission and storage.
Account Information System (AIS) is an application software basically use for recording the process of transaction in accounting. The application may include some module that namely the financial report module, payroll module, balance module, payable module, and receivable module. Mostly the in-house business creates accounting software or the third party developer might have deliver it. There is a variation in the package of accounting software based on the cost and complexity. A competitive edge has been brought by the modern business to use the process of managerial decision for the functional module. Accounting software has undertaken a remarkable change in the Woolworth organization of Australian due to their technology advancement. With all these historical development, adaptability, use and challenges, the research paper has discussed in the literature review about the use of practicing accounting in the business. The literature has also explored the current size of the market and identify the market leaders among the competitors for competitive advantages that has adopted the packages of accounting software in Australia. In the final section of the literature review, some suggestions and recommendation will be provided based on the current gaps challenges that has encountered during the development and improvement of the accounting software packages (ABC News, 2018).
Proposed ERP System Method for Acquisition
When tracking back to 1959 about the origin of accounting software at that time IBM develop 9PAC for the first time, which was a report generation language that stores and access the data structure from the relational database. With the development and designing of accounting systems for a specific requirement, the companies decided to invest for the SAP RF to handle the business operations for the process of taking faster financial decision. The Australian Teleware product publisher acquired the Intuit Company and had changed its name changed to MYOB Limited (Anon, 2018).
Accounting software was adopted quickly by the organization. In one of the study that was conducted by the New Zealand Company for the accounting software had involved almost 1622 small businesses. With result to this, it was found that Australian small business was ahead of adopting the accounting software in comparison to any other countries (Citeseerx.ist.psu.edu., 2018). With the adoption of the accounting software system, the tedious use of paperwork has been reduce. The process of accounting starts with cash book, trial balance, sales ledgers, petty cash ledgers, purchase ledgers, adjusting entries, and financial reports. Previously in manual accounting there was a need of lot of paperwork and bookkeepers. The system of accounting software is quick and easy to use for inputs of correct accounts. This will help in generating reports automatically. The major factor that leads to adoption of accounting software is effectiveness and efficacy for the growing business.
MYOB as an accounting software system has been develop for the Woolworth organization were the below steps were followed for sales transactions and other processes
The market plan for any product successfully work to justify the development product and its condition in the market trends. The Woolworths market size is increasing yearly if the pie chart is check. The growth is up to 37.6 % with comparison to all other supermarkets. It has continuously smash Coles in the sales growth as it had a massive profit in the first half-year. The profit is of $969 million sales growth for the core supermarket business (Forbes.com., 2018). At the FY17 end the organization is trying to move from turnaround to the transformation. Even the chief executive of Woolworths Group stated that there is a good progress of transformation on the sales growth and strategic initiatives. There is a full-year loss for Big W that the Woolworths expects. This loss could be between $80 million to $120 million if compare with the loss of $150.5 million which was in the year 2017.
Sales Procedure System Flowchart
In Australia, the increasing competition for the accounting software market where mostly in the small and medium size business of which the biggest players are the Intuit, Xero and MYOB (Files.eric.ed.gov., 2018). It is a cloud computing accounting software. Currently Xero is the biggest accounting software marketing share in Australia that has emphasize the cloud accounting software. The gaps for desktop accounting software has been identified by this company and faced some challenges whose units are not autonomous (NewsComAu. 2018). The department of the accounting are entrusted in processing, collecting and maintaining the books of accounting. However, desktop accounting software challenges could not be reconcile for other department accounting software as it was containing some incompatible formats and duplication. Therefore, it become tedious, errors, inconsistency and time consuming for annual accounts. The main source of challenges was the use of data redundancy and the desktop accounting system. In many of the Australian business for the integrative capabilities they use cloud accounting software.
Xero is an accounting software that use the SaaS model and for a third party customer and vendor it provide a free API for integration of single unified ledger application in the cloud. The capability of using SaaS has provide an application to users for operating on cloud infrastructure that can be operated through some thin user interface (Forbes.com. 2018). The landscape of IT has been transformed with the integration of Cloud Computing that has brought faster time-to-market, enhance the effectiveness of the cost, demanding scale and innovation.
Furthermore, the major concern for cloud accounting software users were the lack of security in the system. Even with the use of exiting measures of security like firewalls, user feel insecure that unauthorized foreign parties can somehow access their sensitive data and information. The concern behind this issue is because there is a lack of security standards in cloud computing and the provider of cloud use technologies and proprietary security standard of their own (Hatch, 2018). The risk of cybercrime also increases for the cloud computing that is associated with the information assets. Later the cloud computing software challenges were solve through Identity Management (IDM) that take certain measures for service authentication and based on user characteristics and credentials. In Cloud, the approach to Information-centric security has been extended that can control data and security. For any computing environment, it is necessary that the data are describe and self-defended. Information-centric security can be made possible through the framework of Trusted Computing. According to the author, or any computing systems, predicate encryption is required that allow software to compute and run on a cipher-texts environment (NewsComAu., 2018). For the competitive advantage, security of the information, efficiency and effectiveness of the cost has been measured further for cloud accounting software which is the most versatile system.
Identifying Problem with the ERP system and possible fraud
Cost:
It is not that easy to implement the accounting software. As one of the author has mentioned that for the cost of accounting software, a system requires a minimum standards of RAM, hard drive memory and speed of processor (Pc.gov.au., 2018). There are also some additional costs in consumption of the software use that creates a technical support and data for back-up. Moreover, the software allow number of users and add-on features for monthly subscriptions. Thus, increasing the cost of packages of accounting software that has challenged the small scale firm who has to bear the cost of such accounting packages.
Time:
While creating an invoices and expenses through a software, the processing time is more as compare to the one that is recording the same in the ledger or an excel sheet. Furthermore, with the time progress, accounting speed goes high when the employee are habitat to the accounting software usage. Based on the context, the author has even mentioned that accounting software implementation may even slow down the operation of the business temporarily.
Usage Difficulty:
The cloud based accounting software do not have their own designing nor are they based on any conventional system which is the major problem for the user. Those staff who are accustomed with the traditional method of accounting might definitely face problem while using the software (Sci-hub.tw., 2018). Thus, it is advisable that the business frim should arrange some additional training facility for all those staff who are going to use the accounting software. However, there is a quite high chances to commit an error during the implementation of initial phase
Threat of Cybercrime:
The business confidential information might be at risk as the major problem is associated with the cloud accounting software as it is connected to the internet. With this the risk of cybercrimes increases. Even the business bank account is linked to cloud accounting software and the owner can access the bank account through this software from anywhere. However the most threating part here is that the risk of cybercrimes increases like phishing, malwares and many more which can lead to a biggest issue for the employees as well as the company.
For implementing accounting software based on cloud certain recommendation has been provided for the business firms that are as follow:
Optimization the Cost:
The firms can compensate with the price associated with the cloud accounting software purchase and use. This can be done by focusing on the cost control and reduction. The business firm has to identify the non-value activities that are added to the business (Techsoup.org. 2018). The non-value activities can be eliminated by reducing the resource wastage.
Training Session:
The staff can attend some training session to gain the knowledge about the software and its uses in their account maintenance. With these technical skills they can easily use the cloud accounting software. Hence, it becomes important for the staff of the company to get trained and know how to feed data into the software.
Installation software of Anti-virus:
The Woolworth organization are advice to purchase an anti-virus software and install it on the computer system. The data of the customer would be safe and secure. The confidential information available in the system will not get loss with the use of this anti-virus software and the risk will be reducing and the online accounting software will be safe.
Conclusion
With the study, it has concluded that from a simple program to a computing system that is complex there have been a remarkable development history for accounting software. This has solve the challenges that were associated with the desktop accounting software. Moreover, some strategies were applied to deal with the security threats that was face in the cloud computing.
References
ABC News. (2018). Woolworths widens the gap on Coles as ‘down, down’ looks down and out. [online] Available at: https://www.abc.net.au/news/2018-02-23/woolworths-beating-coles-in-supermarket-battle/9479544 [Accessed 23 Apr. 2018].
Anon, (2018). [online] Available at: https://scholarworks.umt.edu/cgi/viewcontent.cgi?article=2899&context=etd [Accessed 23 Apr. 2018].
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Files.eric.ed.gov. (2018). [online] Available at: https://files.eric.ed.gov/fulltext/EJ1134478.pdf [Accessed 23 Apr. 2018].
Forbes.com. (2018). Forbes Welcome. [online] Available at: https://www.forbes.com/companies/woolworths/ [Accessed 23 Apr. 2018].
Forbes.com. (2018). Forbes Welcome. [online] Available at: https://www.forbes.com/sites/phillempert/2018/03/07/the-reopening-of-woolworths-and-finding-your-stores-story/#6cb7191d7678 [Accessed 23 Apr. 2018].
Hatch, P. (2018). Woolworths wins back family shoppers, gains momentum over Coles. [online] The Sydney Morning Herald. Available at: https://www.smh.com.au/business/companies/woolworths-gains-momentum-over-coles-20171031-gzbg2t.html [Accessed 23 Apr. 2018].
NewsComAu. (2018). ‘We have seen some early signs of transformation’. [online] Available at: https://www.news.com.au/finance/business/retail/woolworths-halfyear-profit-up-376-per-cent/news-story/120347ae2a14d5be05b31581f07bb30b [Accessed 23 Apr. 2018].
NewsComAu. (2018). Why Woolies is beating Coles, Aldi. [online] Available at: https://www.news.com.au/finance/business/retail/why-woolworths-is-beating-coles-and-aldi-in-australias-ongoing-supermarket-war/news-story/7c0e1ea754035499f71e6364b465345e [Accessed 23 Apr. 2018].
Pc.gov.au. (2018). [online] Available at: https://www.pc.gov.au/inquiries/completed/retail-industry/submissions/sub110-attachment.pdf [Accessed 23 Apr. 2018].
Sci-hub.tw. (2018). Sci-Hub: removing barriers in the way of science. [online] Available at: https://sci-hub.tw/10.2308/jis.2007.21.2.117 [Accessed 23 Apr. 2018].
Techsoup.org. (2018). A Few Good Accounting Packages. [online] Available at: https://www.techsoup.org/support/articles-and-how-tos/few-good-accounting-packages [Accessed 23 Apr. 2018].
Woolworthsgroup.com.au. (2018). Reports – Woolworths Group. [online] Available at: https://www.woolworthsgroup.com.au/page/investors/our-performance/reports/Reports [Accessed 23 Apr. 2018].
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