Advantages of POS systems
Information technology is increasingly becoming popular among the businesses of every type and size. The adoption of technology also results in positive impact on the business of small organizations. However, such small organizations are incapable of affording the requisite expertise and resources that are necessary for the implementation of the strategies related to information technology.
Point of Sale (POS) systems are gaining popularity and are being increasingly adopted by the businesses as it allows easy performance of diverse operations. The term of POS system can be defined as the computerized networks which creates a linkage between the main computer and the checkout terminals. It is a combination of hardware and software that allows the trader to carry out variety of transactions and simplifies the routine business operations (Cai, Li, Wei & Zhixiong, 2016). This report focuses on the implementation of Point of Sale system in Four Seasons Greenhouse and Nursery and the relative advantages, disadvantages, competitive advantage, recommended telecommunication options and risks.
Following are the advantages and disadvantages that resulted after the implementation of POS systems in Four Seasons.
Advantages
Establishment of accountability- Responsibility can be easily delegated by the owners with the help of POS systems to the staff capable of performing it. This in turn allows establishing the required accountability. Goals are not established by the owners themselves, instead they perform the function of providing the appropriate data to the staff from the system for the determination of sales goals for the specified period (Turner, Weickgenannt & Copeland, 2016).
Decision Making- POS systems allows to maintain accurate business records and data which plays an important role in the decision making by the owners of the organization. It further allows to identify the items that are providing high profits to the organization. Therefore, the organization can easily shift to such items for further increasing the profitability. The decision making related to order quantity is also supported by POS systems on the basis of current inventory units.
Useful than Cash Register- a number of functions are performed by the POS system which provides better usability than cash register including input, tracking and data distribution. Such functions provide valuable information to the user for managing the business operations (Goldman & Sigismond, 2010).
Disadvantages
Risk to Security- a number of security risks are faced by the central network which is linked to the POS system including the risk of the exposure of personal information relating to the customer to some unauthorized person. When the software is not updated on time, the security of the confidential information comes at risk.
Disadvantages of POS systems
Costly Software Upgrade- POS system can perform smoothly only when it is updated from time to time. Some updates in the hardware are also required for the effective functioning of the POS system. However, such updates are very costly and also require acquisition of licenses every time (Park, Adeli, Park & Woungang, 2013).
Less convenient software-based system- Software- based systems are considered to be inconvenient in comparison with the web-based systems. Inventory counts and reports cannot be accessed just with the availability of computers in case of software based system. Hardware is required for establishing connectivity between internet and hardware terminals (Bauer, 2014).
The implementation of POS system in Four Seasons will help in the improvement of operational efficiency of business by taking optimum advantage of the business data. Competitive advantage will be gained by the business as the system provides knowledge to the owners regarding the products that are not performing well and are not being profitable for the business. Profitable products can easily be identified by the owners as detailed cost reporting is provided by POS systems. It also facilitates modification in production by increasing the production of the products that are resulting in higher profits for the organization. Timely information is reported by the POS systems which help Four Seasons in the effective management of the business operations.
Centralized database are advantageous in comparison to other databases. Data integrity is maximized along with the minimization of the data redundancy in case of centralized database as the data is stored in a single location. The storage of data in single location also provides better security to the data from chances of getting tempered or stolen. Moreover, this also brings an ease in alteration, mirroring, re- organizing and analyzing of data. Furthermore, the administration and portability of data becomes easier in case of centralized database. Other databases don’t provide the fault-tolerant setup as provided by centralized database which in turn improves the preservation of data. Centralized database are also easy to be used by the end user and due to its single database design. The end users can easily receive updates on instant bases with the help of centralized database (Higgins, Prior, Harmsen & Seifert, 2017).
Decision making will be facilitated due to the accurate maintenance of inventory data by the POS system of Four Seasons. Earlier, decisions were made regarding order quantity on the basis of speculation.
Centralized databases
POS Systems cause Effective processing of Business Activities
POS systems facilitate instant tracking of the transactions relating to sales which assists in the effective processing of the business activities. POS systems also provides compilation of sales history and updated inventory which helps in the effective operations and management of business (Williams, Waller Ahire & Ferrier, 2014).
Ineffective Manual Tracking of Information
Information cannot be tracked manually in an effective manner as the operational data is inaccessible. Operational data acts as the key with the help of which management of business can be performed effectively. Identification of the profitability of individual items also becomes difficult in case of manual tracking as it does not support cost reporting (Raul, 2012).
Effective Answers to a Number of Questions
POS systems provide answers to a number of questions. It provides accurate inventory counts due to which guesswork is eliminated in the organization. It also provides answers to questions like the number of quantity to be ordered, quantity sold, discarded, etc. The business is no longer required to rely on speculation for deciding the order quantity.
Better Management of Business through the Use of Information
The business data can be immediately tracked at the point of sale with the help of POS system which in tur eliminates the requirement of manual tracking of sales. The system is responsible for performing functions such as storage, data processing, sales history compilation and updating of inventory data. Also, the functions related to sharing, input and tracking of data is performed by the system which helps in bringing effectiveness in the business operations.
Following telecommunication options can be utilized for setting up POS system:
Type of Network- network can be established with the help of options like LAN, WAN and MAN. However, LAN (Local Area Network) based POS system is recommended for meeting the requirements of Four Seasons. Four Seasons is a small business and therefore all kind of required records and settings can be held by LAN. The use of WAN can also be made but the requirement of the business can be easily met by LAN so there is no need for setting up a WAN network. Multiple POS terminals are supported by LAN which are configured for accessing the database server.
Type of Media- It is recommended that Four Seasons should make the use of wireless technology. Such technology can be used in the form of wireless LAN. It is expected that wireless technology can completely alter the operating mode of the industry. Terminals perform encrypted communication with WPA2 security standard (Al Mamun, Islam, Funabiki, Kuribayashi & Lai, 2016). Spread spectrum, narrowband microwave and infrared are the wireless technologies that are recommended for wireless LAN (Chan, et.al. 2014).
Telecommunication options for POS systems
POS systems face a variety of risks in relation to security, privacy and confidentiality.
Security- POS system running on older operating systems can result in the exposure of data to the hackers. The company and customer data also faces risk in cases when the POS systems are fraudulent. Sometimes, hackers take control of the machine which allows them to easily gain access to the data. This leads to their navigation in the whole network through practices like phishing. Hackers also make the use of skimming practices in which hardware is installed on the system through will hackers easily gain access to the credit card information (Yang & Hwang, 2015).
System security can be protected by way of installing anti-virus software for protecting the data from the unauthorized access by the hackers. The system should not be kept at the default password. If third party maintains POS system, then a strong policy should be formulated for password protection.
Privacy- POS system contains different kinds of personal information which can be used by the hackers for fulfilling their purposes. Such information includes name, credit card information, address, email address, birthday, city, etc. The systems can be easily hacked by the hack servers and spyware through which they can retrieve information for unauthorized usage (Gomzin, 2014).
Privacy of data can be protected by updating POS system on regular basis. Security protocol should be followed in the business by the employees. Multi- biometric systems should also be used.
Confidentiality- confidence of the customers of Four Seasons can come under threat due to confidentiality breaches. When an unauthorized person accesses information, the breach of security takes place. Such circumstances have a serious impact on the customers (di Vimercati, Foresti, Paraboschi, Pelosi & Samarati, 2014).
Software based on emerging technology can be used for protecting the confidentiality of the information. It can help in protecting data from known, unknown and emerging threats. The machines are also protected by such software from malware and outside threats and allow to deliver an unfailing VPN connectivity (Jenkins, 2015).
Conclusion
Therefore, it can be concluded that Four Seasons have made the use of technology in an effective manner for ensuring that the business functions in a smooth manner. The implementation of POS system has allowed Four Seasons to improve operational efficiency and competitive advantage through effective decision making. Moreover, the profits of the business have significantly improved as the business has shifted the focus on items offering profitability to business.
Risks of POS systems
It is recommended that Four Seasons should aim to update the hardware and software from time to time. Moreover, Four Seasons are required to take precautions by maintaining strong passwords for the system and installing anti-virus software for the protection of data. WAN can also be used so that telecommunication network can be linked with remote location.
References
Al Mamun, M.S., Islam, M.E., Funabiki, N., Kuribayashi, M. and Lai, I.W., 2016. An active access-point configuration algorithm for elastic wireless local-area network system using heterogeneous devices. International Journal of Networking and Computing, 6(2), pp.395-419.
Bauer, J., 2014. Web Based Point of Sale System. [Online] Available at: https://opus.ipfw.edu/cgi/viewcontent.cgi?referer=https://scholar.google.co.in/&httpsredir=1&article=2098&context=etcs_seniorproj Accessed on: 20 May 2018
Cai, L., Li, K., Wei, W. and Zhixiong, H., 2016. Application of POS technology in fast making DOM from digital aerial images. In Computer and Communications (ICCC), 2016 2nd IEEE International Conference on (pp. 666-669). IEEE.
Chan, M.C., Chen, C., Huang, J.X., Kuo, T., Yen, L.H. and Tseng, C.C., 2014. OpenNet: A simulator for software-defined wireless local area network. In Wireless Communications and Networking Conference (WCNC), 2014 IEEE (pp. 3332-3336).
di Vimercati, S.D.C., Foresti, S., Paraboschi, S., Pelosi, G. and Samarati, P., 2014. Protecting access confidentiality with data distribution and swapping. In Big Data and Cloud Computing (BdCloud), 2014 IEEE Fourth International Conference on (pp. 167-174). IEEE.
Goldman, A. J. and Sigismond, W. D. 2010. Cengage Advantage Books: Business Law . Cengage Learning.
Gomzin, S., 2014. Hacking Point of Sale: Payment Application Secrets, Threats, and Solutions. John Wiley & Sons.
Higgins, P.G., Prior, K., Harmsen, D. and Seifert, H., 2017. Development and evaluation of a core genome multilocus typing scheme for whole-genome sequence-based typing of Acinetobacter baumannii. PloS one, 12(6).
Jenkins, P., 2015. Client confidentiality and data protection. In Handbook of professional and ethical practice for psychologists, counsellors and psychotherapists (pp. 65-75). Routledge.
Park, J. J., Adeli, H., Park, N. and Woungang, I. 2013. Mobile, Ubiquitous, and Intelligent Computing: MUSIC 2013. Springer Science & Business Media.
Raul, V. 2012. Information Systems Reengineering for Modern Business Systems: ERP, Supply Chain and E-Commerce Management Solutions: ERP, Supply Chain and E-Commerce Management Solutions. IGI Global.
Turner, L., Weickgenannt, A.B. and Copeland, M. K. 2016. Accounting Information Systems: The Processes and Controls. John Wiley & Sons.
Williams, B.D., Waller, M.A., Ahire, S. and Ferrier, G.D., 2014. Predicting retailer orders with POS and order data: The inventory balance effect. European Journal of Operational Research, 232(3), pp.593-600.
Yang, D. and Hwang, I., 2015, May. Security enhancement methods for mobile POS system. In Proceedings of the Second ACM International Conference on Mobile Software Engineering and Systems (pp. 152-153). IEEE Press.
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