Benefits and disadvantages of Point of sale
Discuss about the IT for Business for Centralised Database Advantages.
In the present age of technology based business, information has turned into new tool for successful business. It has become essential for the organisations to make sure that they have effective technological equipment present at the workplace in different units (Adeoti & Osotimehin, 2012). POS system is one such device that helps in the maintenance of sales and transactional processing. It helps in storing of the data whenever transactional processing is done. This report analyses the benefits and demerits linked with the POS system along with the telecommunication network that will required for usage of Point of sale system.
Point of sale brings a huge number of benefits and drawbacks to the business (D’angello, 2018). For the small organisations like Four Seasons Greenhouse and Nursery POS gives following advantages and disadvantages:
Advantages
- It helps in storing crucial data related to sales and transactions on the real time basis.
- It helps in customer relationship management as it alerts users about the transaction being made (Dontigney, 2018).
- As data can be received anytime hence it is very helpful in the case of decision making process as very effective and real time decisions could be made using this.
- It ensures that almost no transactional errors due to human faults occur and same time quick services could be provides to the users using this system.
- It ensures that no data redundancy problems exist in sales information management (Guinn, 2018).
- The POS ensures accountability at the same time it brings transparency in the work process
Disadvantages
- There are many security and data privacy risks associated with the use of POS systems.
- Maintenance of the information system is not easier and generally done by IT professionals (Hansen & Sia, 2015).
- If the system got damaged then it may lead to huge data loss which is not good in the present business environment.
Since huge benefits are linked with use of POS system in the firm hence it directly provides competitive advantage to the firm. POS system helps in making many of the processes easier. The first thing that POS system does is that it increases the quality decision making capacity of the firm (Hongqiang, 2011). With the data that is available through the POS system, a firm can understands about the products that is increasing their profits and which are not. This data is crucial as the firm will also focus on the sale of that product only. The collected data is also utilised for the process of making efficient strategies since the data available are time and accurate. POS system improves the business processes like accounting, decision making, product performance management etc. These are the major factors in the modern day business to provide competitive advantage to the firms.
Apart from this also speed up all this process which is necessary for entertaining larger set of customers on daily basis (McCarthy, 2018). The data that is gathered through POS system helps in satisfaction of the clients as proper details regarding the purchase is provided to the customers and in case of any query it provides the required details regarding the sale. It removes the flaws that are may arise due to manual errors as well as it also assist in the process of forecasting the demands. If the company is ready for its future demands which they have to face, it can easily gain competitive advantage over the rivals.
Competitive advantage provided by POS system
There are various functional units in an organisation. All these units need to work in collaboration. Database plays a very essential role in this regards as they help in the process of decision making (Szell, Lambiotte & Thurner, 2010). This calls for the need of having a centralised database system. There are several advantages of using centralised database within an organisation. Some of them are:
- As the data is not distributed hence the places at which data can be attacked by the malicious contents is less.
- It is easier to retrieve data especially whenever required as it can be availed through one location.
- Data portability becomes simpler.
- Management of data especially when there is a need of making changes in it (Qawami, Talaich & Farrell, 2014).
- For managing and controlling of data very less amount of resources are required which makes it highly cost effective system.
One of the core benefits of using POS system is the fact that it makes the decision more accurate and realistic. As the POS systems stores a huge amount of data that could be used by Four Seasons Greenhouse and Nursery for making of decisions. This would help them in their growth. It has become essential for all the organisations to maintain the accurateness of data (Cunningham, et. al., 2015). This can only be possible in the case when real time data is available with the firm at the time of decision making. A data driven approach is facilitated by the use of POS systems. It also supports decision making as a more analytic and decisive decisions could be made with the help of the data that is generated by the use of POS systems. It also helps in making the decisions regarding the flaws that are present in the sales procedures which will be beneficial at the time of decision making.
Earlier the data management especially related to the accounts was considered to be as the time taking process. This was because the manual methods were very slow and has many types of flaws in it. It was having direct effect on the business operations because of the probability of generation of wrong decision through such data (Duvall, Reece, Hrabosky & Burton, 2012). POS system eliminated the chances of data redundancy and it can be tracked at the same time it is generated. The information gathered through use of POS systems can be easily sorted out and hence decisions can be made very easily based on various variables. POS system assists in finding the fact that which seller is performing well and upon which Four Seasons Greenhouse and Nursery has to focus upon. In their process segmentation and targeting, this sales data plays a very crucial role. It smoothens up the other process like accounting, sales management, demand forecast etc.
At previous time yes it was tracked with the help of manual procedures. The demerit of it was in huge numbers. First is the fact that it was a highly slower process and does not fit up the expectations of modern day business (Samek & Hernandez, 2013). With the chances of data redundancy, it was always possible that wrong decisions could be made. Manual tracking of data required a huge amount of human efforts. An element of doubt regarding the accuracy of data was always present. In manual processes it was not possible to make instant decisions which have become a crucial aspect in the modern day business.
Centralised database advantages
With the use of POS systems many type of questions could be answered with the help of POS system. It helps in answering the question that is linked with sales and transactional procedures. It also solves the questions that are linked with accounts procedures within the organisation. It also provides answer regarding the trending products or says about the major choices that are made by consumers. Analysing these data can be used for finding the competitive gains (Dai, 2015). Questions related to required changes within the organisation can also be answered through it. Data related to performance of sales unit within Four Seasons Greenhouse and Nursery can also be answered.
There are various types of data that is gathered through the help of POS systems. This crucial information can be used for the process of decision making regarding making changes in the operational mechanism (Redmond, Huang & Heisinger, 2012). The gathered data could be used for finding out the demerits in the system and hence plays a crucial role in the management of systems. Information obtained through this can help in removing the operational inefficiencies of the business processes. It is necessary for making the business processes more accurate and as per the requirements of the market.
Advancements in telecommunication sector have been very fast. This has provided firms with many kinds of options. As the Four Seasons Greenhouse and Nursery is small business enterprise hence its telecommunication requirements is very unique. For any firm it is crucial that select the telecommunication option as per their requirement. Some advanced telecommunication options are also available in terms of the type of networks.
There are wide ranges of options that are available with Four Seasons Greenhouse and Nursery Company. They could use of any of these options but it would be better for the organisation to adopt Local Area Network. As the number of systems that has to be arranged in a network is lesser in number and all these devices that has to be linked is also at the nearby place. LAN provides a facility of connecting the systems that are present at nearby location in a very high speed connecting network. As Four Seasons Greenhouse and Nursery Company is having limited amount of resources hence it would be beneficial for them to connect their systems in a LAN network.
There is a wide range of options available with the cited firm in terms of the ways in which they can connect their systems. The selection of media plays a very decisive role in the performance of the network and the IT system. All the systems can be connected with both wired and wireless media. Since the distances at which the systems are to be connected are not so far hence it will be effective for the firm to connect it through wired connection. The selection of the media has been on three bases:
- First is the fact that wired connections are easier to maintain.
- The speed of connection provided by the wired connection is very fast.
- There is a less chance of data through the wired connection.
POS system facilitates decision making
For connecting in wired connection there are many types of cables are also available. Since the resource available with the firm is less hence use of Ethernet cables could be a better option. It is also beneficial as Ethernet cables are lower cost and the probability of data leakage is also less.
With the use of POS system, there are various kinds of risks that are attached with the use of POS systems. Four Seasons Greenhouse and Nursery Company have to deal with these risks by the help of better strategic methods by understanding the impact of these risks. Common risks that linked with the help of POS systems are as follows:
- Security: Huge amount of data is available with the POS systems. These data are of strategic importance and if goes into some wrong hands can lead to strategic failure. It is crucial that an organisation safeguards its financial data so that no monetary losses can be noticed by the firm (Xian, Ellis, Good & Zhu, 2013). Financial reputation of cited firm will also go on stake if the security is compromised. Use of data protection software can be crucial in this regards.
- Confidentiality: There is a huge amount of confidential data stored in the POS systems. In order to manage the performance of various units confidentiality is a major issue. For example since a whole lot of cards are swiped through the POS machines hence confidentiality is a major issue.
- Privacy: There is various privacy issues linked with the IT systems and so is the case with POS system use (Cheng, Hsu & Chou, 2013). Privacy related to stakeholder’s data needs to be maintained and use of firewalls can be highly beneficial in this regards.
Conclusion
On summarising the report it can be said that POS systems are of greater importance in the modern data management of financial data. There are several advantages and disadvantages linked with the use of POS systems. A centralised database has higher numbers of benefits. POS system facilitates decision making as it provides real time and data without redundancy at the time of decision making. LAN with the help of wired connection can be a better option. In that also Ethernet cables can be highly beneficial in this regards. Risks such as privacy, security and confidentiality are present with the use of such systems.
POS systems have been very useful in terms of managing the data that is related to sales and transaction hence must be used inside the firm for its different purposes. The use of LAN connection and connecting the system with the help of wired system can beneficial in terms of cost saving and ensuring high speed performance. The cited firm must use Ethernet cables for connecting systems as the data leakage through these cables is least. There are many risks that are present in the business with the use of POS system hence company must use effective security software so as to ensure the security of the systems.
References
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D’angello, M. (2018) Retrieved from: https://www.business.com/articles/essential-pos-features-retail-business/
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