Computer

A digital watch or clock shows the time with numbers that change as the time changes. The word digital obviously originates from the word digit, meaning number, and although difficult to explain the exact meaning of digital, in layman’s terms it is a means of converting information into a binary code, of 0 and 1. The ideals behind digitizing information, is basically to maintain and enhance the quality of any information we can see or hear. To be more to the point, any information, whether it being audible of visual, communicated to our senses. As opposed to analogue, where the information is carried by a series of “waves” which can peak or trough. These waves are prone to interference and the further the waves travel and the more the information is reused; this is where the quality of the communication is lost. Analogue works by recording the information and “reproducing” it through measurements in another form, because it is being Re-produced, it can never be an exact representation of the original source.

The idea with the invention of digital was to process these waves into a format, or a code, which can be read by a processor, as either 0 (which I shall call off) or 1(Where the transfer of the information is on). So hypothetically speaking, the mode of communication is either on or off, with no in-between levels. This means technically speaking Digital should not be prone to Quality loss, like analogue. Using the digital format the information should be able to be “exactly replicated, time after time after time.

In fact any form of information stored on a Digital medium, such a compact disc, should last for eternity that is unless the storage facility is damaged. Since the birth of media and communication, everything was based around some form of analogue processing; early film and photography relied on light waves to capture an image, microphones measured vibrations from sound, and converted them to magnetic charges, which could be stored on an audio tape. When the tape is played back, what we hear is a representation of the original sound, first recorded.

Today every form of media, is capable of incorporating some form of digital aspect, within the way it is communicated to us and the “digital revolution” is growing at an astounding rate. It could be argued that it is the biggest change over of technology since the industrial revolution. The digital boom, started to take of in the masses in the early 80s with the increase in home computers, and digital cable television, these are arguably the biggest influences on the increase of ” going digital” and the technology that is available to the world today.

It is estimated that one in three people in the U. K has accesses to the internet, the world wide web, being on huge digital library easily accesses from home. If you are well trained in the use and manipulation of the internet it is said that it is possible you can find information on any subject, and any person, without even leaving your seat. This is obviously a huge advantage, large amounts of digital information held on websites all over the world, and the majority of the information is free. It benefits education as a source of research, banking, and the fact you can download digital media( such as music and films) and store it on your hard drive, has given people a new perspective on entertainment. Because of the way the binary (computer) code can be transmitted down a phone line, and compressed, it has opened up new means on how people can store their information. Practically gone are the days, where offices were filled with filling cabinets full of client information, now it is all stored digitally, on a computer.

An add on benefit of this is because of how digital data can be duplicated, without quality loss, then back up copies can be made of the same information, just incase of any damage to the storage devise( usually the hard drive). If we compared this with books or documents, replacing them in the event of a fire for instance would be expensive and in some cases impossible, however if the same digital information is “backed up” on other machines and disks, replacing the lost information, can essentially be pretty effortless.

Electronic mail has become more widely used and accepted by businesses and people alike. It can be sent at the click of a button anywhere in the world and arrive at the other end pretty much instantly. The receiver of the mail, can “pick up” the information at any time during the day, and again reply instantly back. Unlike hand delivered mail, it is free (or just the cost of connecting to the internet) and again because of its digital format, can be instantly duplicated, so that the same message can be sent to several different people, in several different countries at the same time.

This has obviously increased efficiency and communication, with in companies a hundred times over. Its also given more opportunity for friends and family in different parts of the world, to stay in touch. It is now possible to send E-birthday and Christmas cards, which like any other document or image which has been sent, can be printed out, and kept as a “hard copy” if you wish. The way and efficiency in which the e-mail system works is definitely a benefit or an ability only digital communication has. An example of this, in its simplest form, is that I have just mailed this essay, as it is, to my E-mail account, where I can collect it still in its exact original form and continue with it on a college computer, or for that matter any other internet ready computer in the world. Without this system, I would have to physically take the assignment with me to my destination or simply start again, if I had lost or forgotten it.

CHAPTER ONE INTRODUCTION 1. BACKGROUND OF THE STUDY. The world as a global village has become so computerized that the use of computers is inevitable therefore makes them very important in all aspect of human life especially on the accounting field. Accounting system is a procedure that is designed by an organization for capturing all financial events and data in an organization. An accounting system after capturing and gathering all events and activities has the ability to process them and communicate them to interested parties for decision making.

Financial institutions in many countries were so much concerned about the switch from manual to computerized accounting system. It must however, be emphasized that manual accounting systems has not been eliminated completely but reliance and dependency on them has been reduced drastically due to the emergence of computerized accounting systems. While many financial institutions responded quickly to the use of computers in accounting systems, others still face difficulties in adapting to these computerized systems of accounting.

Most organizations have resorted to the use of computers in their accounting systems because of the inherent accuracy and processing speed of this automated accounting system. They also have resorted to it because of the efficiency which leads to higher profitability. It is obvious that this computerized accounting system has led to the reduction of time; cost and quick generation of reports since one no longer have to wait a whole day to get a report. Although the emergence of this system comes with a number of benefits, it still has got some problems associated with it.

One inherent problem with this new system of accounting is the high cost of operations. Day in and day out, computers that become obsolete need to be replaced or upgraded to meet acceptable standards. In addition, this new system has brought about computer crimes. For example, the Equity Funding Corporation Scandal in the USA is probably one of the most outrageous frauds that have been committed with the assistance of the computer. Total estimated misappropriation as a result of computer crimes in the United States America seems to be in the region of U. S 35 million.

These cost associated with computerized accounting system have prompted decision makers in financial institutions to do careful analysis of their accounting system and its loopholes before making a choice of a system which will suite them best. One thing that has also made the use of computers a delight is the less need for visual editing because of the ability of the computer to perform many editing steps by having programmed controls incorporated in the computer program. Recently, the allocation of resources or quota in banks for embarking on projects has been made easy due to the discovery of Swedish Grid Accounting System.

This accounting system which was developed by Swedish Research Council maintains a Grid wide view of the resources consumed by its members. 1. 2 STATEMENT OF PROBLEM Despite the availability of computers at Ecobank, clients still queue at the bank hall and the probability of Tellers to make mistakes is high. Customers still queue in order to withdraw monies from their accounts due to power failure despite the ATM facility available to them. This also applies to those who have access to the ATM’s but still issue out cheques. Another major problem that the bank faces is the poor network system.

Customers sometimes make payments into accounts of other branches and takes days for the amounts to reflects in that accounts. This research at the end will find solutions to the problems above and appropriate mechanism to be applied at the right time to encourage the effective and efficient use of computers available to Ecobank. 1. 3 RESEARCH QUESTIONS The study attempts to find answers to the following questions: ? What are the various hardware products available at Ecobank? ? What are the various software products available at Ecobank? ? To what extent has Ecobank used computers in their banking operations? 1. OBJECTIVES OF THE STUDY ? To get managements opinion on the concept of using computers in accounting systems. ? To make known to all some of the problems linked with the computerization of accounting systems in Ecobank, Adum. ? To find out how over the years problems associated with this system have been solved. ? To discover the impact that the use of computers in accounting systems have had on the operations of Ecobank, Adum. 1. 5 SIGNIFICANCE OF THE STUDY This study aims at: ? Solving some of the problems caused by the computerization of accounting systems in these financial institutions. Discovering how the computerization of accounting system has helped these financial institutions in their operations. ? Highlighting changes in a specific accounting system which has enhanced the flow of work at the bank. ? Providing researchers, banks, policy makers, students and lectures who offer I. T related courses find this material useful in appraising their syllabus. 1. 6 SCOPE AND LIMITATIONS OF THE STUDY The research work was centered on Ecobank, Adum branch. The following are the limitations of the study; ? There was no financial and logistical allocation of resources needed to carry out the entire research.

As a result, this study was restricted to only a handful of financial institutions here in Kumasi with Ecobank as the case study. ? interviews were made only in some selected financial institutions which have their accounting systems computerized ? Time was another constraint as the research had to combine the research with lectures. 1. 7 CHAPTER ORGANIZATION The chapter one has to do with the introduction of the study and consists of the background of the study, problem statement, the objective of the study, research questions, significance of the study and the scope and limitations of the study.

The second chapter reviews the available literature of the study. Chapter three deals with research design, population of the study, sample and sampling technique, data collection and data analysis. Chapter four covers the presentation and analysis of the study as well as the discussion of the research findings. The final chapter covers the summary of the research, conclusions drawn from the findings and recommendations made. CHAPTER TWO LITERATURE REVIEW 2. 1INTRODUCTION

An accounting system consists of the business, documents, records, equipment, policies and procedures use to record transactions and events that affect an entity’s financial performance and its financial status. A good accounting system should be capable of meeting the requirements and needs of the financial institution for which it is designed. As business grows its transactions also grow and the firm looks for ways to speed up the accounting process by streamlining its accounting system hence the use of computers.

There are many accounting tasks such as invoicing, payroll and bookkeeping, which involve the processing of large amounts of numerical data. Such routine transaction processing is a substantial cost burden on organizations and the desire to reduce these costs provides motivation for the early introduction of computer systems. The development of minicomputers in 1963 allowed medium-sized organizations to begin using computers for accounting tasks. The introduction of business microcomputer in 1979 extended the use of computers to the accounting function of smaller organizations. 2. 2 ACCOUNTING SYSYTEMS

Several scholars in the field of accountancy have expressed their views with respect to the whole idea of the computerization of accounting system. In his study on the automation of accounting practice Strangster (1992) examined the factors that affect accounting information and concluded that the accounting environment, technological change and the availability of resources are amongst the most significant variables influencing accounting automation. To meet these needs and to satisfy the fiduciary responsibility of management, Accountants prepare a single set of general purpose-financial statements and reports.

These statements are expected to present objective, unambiguous and complete economic facts of the existence and operation of the enterprise. This is what accounting reports generated from a computerized system would expect to portray, hence the act of report generations itself must be easy and not cumbersome. (Koerber K. (1992) P8) describes accounting systems as the field that designs and implements the system of records – Keeping that meets all the informational, processing and retrieval needs of different types of accountants within an organization.

He emphasized that, an important segment of accounting system s Electronic Data Processing (EDP). He described further that before the advent of computers, all recordings were done manually. Hilton (1994) regards the accounting system as procedures, personnel and computers used to accumulate and store financial data in the organizational part which are the costing accounting system, management accounting system and financial accounting system. According to Bagranoff (1996) the computer’s ability to handle an organization’s routine bookkeeping has led to a growing emphasis on managerial accounting.

Accountants freed from Bookkeeping tasks are now concentrating on the design of systems, the developments of budgets and recommendation of future managerial actions in a variety of operational areas. Increased in computerization of accounting system affects auditors as well, they are finding their jobs to be quiet different today due to increasing reliance on generalized audit software and other Computer Assisted Audit Techniques (CAAT). These tools allow auditors to examine computer output and processed more efficiently.

In addition, traditional accounting firms, whose incomes used to be largely generated by audit and tax auditor are new helping clients design and implement computerized accounting information systems, hence the effects of computerization are an important area of study in accounting information system. 2. 3 COMPUTERIZED HISTORY OF GHANAIAN BANKS Over time, computerization has increased in importance in Ghanaian banks. Traditionally, banks have always sought media through which they would serve their clients more cost-effectively as well as increase the utility to their clientele.

Their main concern has been to serve clients more conveniently, and in the process increase profits and competitiveness. Computers have been used extensively in banking for many years to advance agenda of banks. In Ghana, the earliest forms of electronic and communications technologies used were mainly office automation devices. Telephones, telex and facsimile were employed to speed up and make more efficient, the process of servicing clients. For decades, they remained the main information and communication technologies used for transacting bank business.

Later in the 1980s, as competition intensified and the personal computer (PC) got proletarian, Ghanaian banks begun to use them in back-office operations and later tellers used them to service clients. Advancements in computer technology saw the banks networking their branches and operations thereby making the one-branch philosophy a reality. Barclays Bank and Standard Chartered Bank pioneered this very important electronic novelty and later Ecobank also started using computers in their operations, which changed the banking landscape in the country.

Arguably, the most revolutionary electronic innovation in this country and the world over has been the ATM. In Ghana, banks with ATM offerings have them networked and this has increased their utility to customers. The Trust Bank, in 1995 installed the first ATM. Not long after, most of the major banks began their ATM networks at competitive positions. Ghana Commercial Bank started its ATM offering in 2001 in collaboration with Agricultural Development Bank. Five (5) banks currently operate ATMs in Ghana.

The ATM has been the most successful delivery medium for consumer banking in this county. Customers consider it as important in their choice of banks, and banks that delayed the implementation of their ATM systems, have suffered irreparably. ATMs have been able to entrench the one-branch philosophy in this county, by being networked, so people do not necessarily have to go to their branch to do some banking. Another industrial innovation in Ghanaian banking is the various electronic cards, which the banks have developed over the years.

The first major cash card is a product of Social Security Bank, now Soceite Generale SSB, introduced in May 1997. Their card, ‘Sika Card’ is a value card, onto which a cash amount is electronically loaded. In the earlier part of year 2001 Standard Chartered Bank launched the first ever debit card in this country. Its functions have recently been integrated with the customers’ ATM cards, which have increased its availability to the public since a separate application process is not needed to access it.

A consortium of three (3) banks (Ecobank, Cal Merchant Bank and The Trust Bank) introduced a further development in electronic cards in November 2001, called ‘E-Card’. This card is online in real time, so anytime a client uses the card, or changes occur in their account balance, their card automatically reflects the change. Though ATMs have enjoyed great success because of their great utility, it has been recognized that it is possible for banks to improve their competitive stance and profitability by providing their clients with even more convenience.

Once again computerization was what saved the day, making it possible for home and office banking services to become a reality. In Ghana, some banks started to offer PC banking services, mainly to corporate clients. The banks provide the customers with the proprietary software, which they use to access their bank accounts, sometimes via the World Wide Web (WWW). This is on a more limited scale though, as it has been targeted largely at corporate clients. Ghana Commercial Bank, Ecobank, Standard Charted Bank and Barclays Bank and Stanbic Bank are the main banks known to offer PC banking services.

Banks have recognized the internet as representing an opportunity to increase profits and their competitiveness. Currently, no bank is offering internet banking (internet-banking) in Ghana, but some have well laid plans to start. Ecobank, Standard Charted Bank and Barclays Bank, also have plans for doing so in the not-too-distant future. Telephone banking, has also taken a big leap with its convenience and time. Barclays Bank launched its telephone banking services in August 28, 2002. SSB Bank also launched its “Sikatel” or “SSB Call Centre” (telephone banking) in September 19, 2002.

The services available with this system are ascertaining credible information about the bank’s products, the customers’ complaints, bank statements and cheque book request and any other complaints and inquiry. The introduction of E-Zwich is another innovation in the country. E- Zwich is the brand name for the National Switch by Bank of Ghana, under the new Universal Electronic Payments (UEPS) technology which would ensure that all commercial banks, rural banks and savings and loans institutions in Ghana implemented a common payment platform and biometric Smartcard.

To make this technology really feasible, the Bank of Ghana [BOG] (Ghana’s central bank) has issued a directive that all banks linked their ATMs & Point of Sale (POS) terminals to the National Switch, the E-Zwich by March 31, 2008. Banks with existing switches are expected to upgrade them to make them compatible with the National Switch by July 1, 2008 while banks without switches/ATMs / POS terminals are expected to integrate their payment terminals directly into the National Switch or through a E-Zwich compatible switch.

GUIDELINES FOR THE OPERATION SOME COMPUTERIZED SYSTEM BY BANK OF GHANA. 1. The Bank of Ghana’s responsibility with regard to platforms for Automated Teller Machines (ATMs) and Electronic Funds Transfer at Point of Sale Systems (EFTPOS) is to ensure an appropriate legal and regulatory environment, competitive market and high standards for cards, ATMs and ATM platforms. The Bank of Ghana (The Bank) shall also ensure that suppliers have the technical and financial capacity to deliver and support their systems. 2.

In granting permission for the setting up of a platform and/or its operation, the Bank shall be guided by the need for an orderly development of the payment system. The following conditions shall apply: i. The provision of ATM and EFTPOS services shall be limited to banks and consortiums of banks and other corporate bodies; ii. The card technology must be ISO 8583 and EMV compliant while the platform/ATM system should be able to support different card types including smart cards, ATM cards, common credit and debit cards such as VISA, Mastercard, Europay, American Express, Diners Club etc. ii. Platforms must be interoperable with international ATM and EFTPOS networks operated by companies with international reputation. To satisfy this requirement, the switching companies must be operating in North America or Europe. iv. Banks applying for a domestic platform must meet the following requirements with regards to the number of banks, ATMs and the networking of a bank’s branches. (a) More than four banks, minimum of 20 ATMs and 50% of the branches of each bank networked. (b) Four banks, minimum of 30 ATMs and 50% of the branches of each bank networked. c) Three banks, minimum of 50 ATMs and 50% of the branches of each bank networked PAYMENT SYSTEM DEVELOPMENT PLANS Plans are far advanced for the introduction of cheque codeline clearing and truncation system. This system would decentralise the capture of cheque MICR code-lines and cheque images at the point of receipt of the cheques by the banks. The banks will then sent the electronic files of the code-lines and the images to BOG for clearing and settlement. This will enable the truncation of cheques at the point of economic deposit and the use of cheque images for mandate verification.

It is expected to free resources like labour and reduce costs generally for cheques clearing. New regulations and relevant laws would have to be enacted to support the new cheque clearing environment. In addition to the above system, an Automated clearing House (ACH) would be introduced to handle bulk electronic credits and debits and thereby speed up the clearing of funds within the system. The SWIFT software messaging and communication systems will be harnessed to support cheque truncation and the ACH.

Furthermore, new policies are being drafted with respect to electronic banking, card-based payments (e-money and debit cards) and the oversight function responsibilities of the central bank thereof. 2. 4 PROFILES ON ECOBANK Ecobank is an independent Regional Banking Group in Ghana and other parts of West and Central Africa providing wholesale and retail banking services to its customers. Established in 1985, Ecobank has grown into a network of over four hundred and fifty branches with offices in twenty- two countries including Ghana.

The governance structure within the Ecobank group is such that the parent company acts as a “strategic architect” with limited involvement in operational management and decision making at subsidiaries level. In Ecobank, operational decision making is individualized and maintained at a level as close as possible to required action and customers. 2. 4. 1 Ownership/Branches Ecobank’s shares is presently held by more than six thousands (6000) private and institutional shareholders throughout Ghana and other parts of world.

The company’s authorized capital is U. S $ 1250000000 ordinary shares of 0. 125 each. Ecobank has four hundred and fifty (450) branches with offices in twenty-two (22) countries including Ghana. 2. 4. 2 Workforce Ecobank Ghana Limited has close to a thousand professionals that is made up of management, branch managers, security personnel’s and other staff. In terms of gender diversity, forty (40) percent of its employees are female and the balance being male employees. 2. 4. 3 Mission Statement

Ecobank is committed to enforcing management standards and policies in areas of ethics, anti- money laundering, conflict of interest and co-operate governance because it believes it enhances it shareholders value. 2. 4. 4 Vision Ecobank hopes to explore the potentials offered by the internet as an efficient distribution and communication channels for delivering the service provided by its network of branches and offices. 2. 4. 5 Customers Ecobank now boast of an estimated thirty thousand clients which includes governmental organizations, private organizations and individual accounts holders. . 4. 6 Products and Services ? Current accounts ? Savings accounts ? Cards ? Deposit accounts ? Personal loans ? Car and motor loan ? Business loan ? Bills for collections ? Transfer and payments ? Western union money transfer ? Call accounts 2. 5 THE CONCEPTION OF COMPUTERS IN ACCOUNTING SYSTEM MANAGEMENT DECISION The whole idea of the use of computer in accounting systems cannot be over emphasized without talking about the fact that it is based primarily upon management’s decisions normally made up of board of chairman, heads of departments and IT Specialist.

These people having seen the need for the uses of computers convince the staff and all and Sundry on the use of computer. This is done having taken factual consideration of its negative effects. The decision taken by management was done as a means of increasing productivity and ascertainment of rapid information at any particular point in time as well. 2. 6Hardware Used At Ecobank 2. 6. 1 Mainframe computers The mainframe computer a high-level computer designed for the most intensive computational tasks.

Mainframe computers are often shared by multiple users connected to the computer via terminals. The most powerful mainframes, called supercomputers, perform highly complex and time-consuming computations and are used heavily in both pure and applied research by scientists, large businesses, and the military. 2. 6. 2 Micro computers The microcomputer is the common among all computers. It is designed to fit on a desktop. However, it is not as powerful or as fast as the mainframe computer and has a smaller memory size.

These computers were proposed by service of National Cash Registry (NCR) whose main functions is to assemble and supply computers and accessories to Ecobank and other financial institutions in Ghana. The computerization process began 1998 at Ring Road Central branch with an evaluation of the needs of the service bureau to the bank on the type of computers that will be needed to ensure quick and efficient service aimed at meeting the company needs, this was only done after the contract between the client company and service bureau had been signed.

The bank used these computers upon expert advice received from these service providers though sometimes they could also bring out their own specification. 2. 7 SOFTWARES USED AT ECOBANK Ecobank borrows its software known as the Grab software form City Bank; they later adopted different software’s including, Tally, Aptra Hawk, Pips and sparrow. Each of the software’s performs different functions.

The more sophisticated ones like Aptra, the Hawk and Sparrow are computer software used by the Automated Teller Machine (ATM), whereas the software Pips deals with micro processing which is engaged in cheques related activities. 2. 7. 1Introduction of flex-cube mechanism The activities of banking at Ecobank for example has been improved further with the introduction of flex-cube mechanism software which has provided all needs or almost all in respect of the banking work in areas such as ? Providing good reports and feedback; Storing large data leading to improved performance; and ? Providing central database software where activities were monitored to ensure efficiency and effectiveness. 2. 8 THE GENERAL PERCEPTION ON THE USE OF COMPUTERS The perception of the general use of computers in Ecobank when critically looked at can categorically be seen from the view point of employees and customers since computers influence their activities. Taking the manufacturing sector for example where over a thousand different jobs were o be undertaken by different employees before a particular process, now with the introduction of computers all these several jobs can be undertaken by the mere press of a button where something starts to build. The computer has been rendering thousand employees jobless thereby bringing tension and fear within that industry. But for customers of Ecobank it was like a prayer being answered, a long awaited miracle, where all their troubles have just come to an end.

They were very pleased with such an innovation as long waiting and cumbersome procedures involved in the depositing and withdrawal as well as other banking and non-banking duties, will have been solved. This however confirms the old wise saying that ‘one man’s meat is another’s poison’. 2. 8. 1Perception Of workers on the use of Computers at Ecobank The whole idea of the fear of unemployment which was established in the previous topic discussed was no exception from that which was going through the minds of Ecobank staff who were working on manual till the introduction of these computers.

In fact, the change over to the use of computers was met with serious resistance from the staff working at that time for the some old perception that they will be laid off “Change, they say, is painful but once adopted goes a long way to really workout for good whosoever is involved’. According to Ecobank staff, about three hundred (300) of the workers at Ecobank were deployed upon an exercise undertaken by Ecobank known as the Manpower Labour Rationalization Programme (MLRP).

Here computerization was seen as the main reason for the exercise after which management budgeted for the cost improving and training each and every staff member left behind to have total knowledge in computer. Those members of staff who were left had to accept the change and were encouraged and educated on the use of computers to relieve them of very hectic activities which the machine could undertake on their behalf to make them relax after a long days work. The computer was finally received fully with employee cooperation such that the ratio of employee to computer is close to one to one and an average of two to one.

The employees confess that the use of the computer has boosted their confidence and happens to relieve their physical as well as mental demand with respect their job. 2. 9 THE CHANGEOVER TO COMPUTERS-SOME SPECIFIC SYSTEMS/TRANSACTIONS The drift from the manual to the computerized accounting systems as pursued by financial institutions has been that of solving problems and creating problems. Some of the replace manual systems and everything that goes with them are enumerated below. 2. 9. 1 Account Opening

With the manual system there was the use of the ledger cards which were on its own a hectic thing to use as cards could get missing at any particular point in time, the serious aspect was that when ones card was not seen then it is like there is absolutely no record about that account not even mentioning the balance of that account. But with computerization, there are regular points out of various account and other things, which are stored in the computer in other words, there is the hardcopy and the softcopy making tangibility of records available.

Also with the use of computers so many accounts can be opened as possible as there is no much work involved due to the computerization of accounting systems. 2. 9. 2 Counting Of Money Gone were days where the hand was at the mercy of money that needed to be counted, whether large or small. Now the introduction of these money-counting machines has replace the counting of money by hand by which the former seen to be faster and hence speeds up work resulting in less queues in banks especially.

Other institutions, insurance companies and financial service providers also use it. 2. 9. 3 Withdrawals The manual system resulted in the spending of more hours at banks as a result of long queues to withdraw money especially on paydays of government workers. This however, was very frustrating to the customers. The use of ATM especially to pay workers has reduced drastically this king of inconveniencies hence leading to fast payments of workers.

With the use of a card where the name of the holder are programmed and put into the computer, with the help of a specially diskettes, the ATM however helps in giving cash, statements of accounts and instant balance that speeds up the process of payments. Other cards such as credit card, monde card, e-card, visa card, sikatel card all exists to make access to money easier and convenient. 2. 10 CHECKING OF ACCOUNT BALANCE These are easily checked by the use of computer irrespective of the branch due to the networking of systems available 2. 10. 1 Balancing Of Accounts

The manual system was that of very hectic work as every account will have to be balanced by an accounting personnel before the day ends which sometimes eats late into the night, but with computerization balancing of accounts are done within minutes as the computer does everything with the correct accounting package in place. This is known as the self-balancing of accounts where no one really is involved. Journals are opened or written, profit and loss accounts are prepared by the machine. This invariably reduces the number of people working at the financial institution. 2. 11 INTERNATIONAL TRANSACTION

This is normally done with certain requirements in place. The bank should have an affiliated bank in the country of transaction. Every link should have been cleared and terms understood by the bank being affiliated to. With computerization there is the use of the swift system, which takes place on remittance; Ecobank for example has an affiliated bank called the City Bank which deals with such transactions outside Ghana. This has seriously reduced the mailing system which was the style of the manual system where the post was used which could take months to complete a very simple transaction.

Hard copies will have to be received through the mail, which sought to confirm that the transaction has taken place. In the course and zeal to computerized the following advantage and disadvantages were brought to light. 2. 11. 1 Advantages ? Increase in profitability ? Improved workout put 2. 11. 2 Disadvantages ? Power failure causes inconvenience to staff and customers. ? Redundancy due to computerization, Ecobank undertook one, which known as the labours rationalization programme. ? Computerization cannot be practiced everywhere or places where there is no electricity.

Some of the branches that are not yet computerized. 2. 12 THE GLOBAL PHENOMENON-NEW DEVELOPMENTS With the current move to information technology in the part of the globe, there is a higher intensity in the use of computer where they are seen to do much of the work to be carried out. Much however needs to be desired as financial sections like auditing among others are still more evidence with the use of books and receipts which are required on hard copies for auditing purposes, this however makes total dependency on computer not very whole.

In existence is the Computer Assisted Audit Technique (CAAT), which uses the computer as the main tool in the process of auditing, this technique given time will drastically minimize the use of hard copies such as foolscap sheets, and books etc. With the existence of the ATM card, e-card, e switch, master card, credit card, monde card and other mechanisms that limit the handling of physical cash, The other mechanism that limit the handling of physical cash the world is poised to enter into a realm where one will be able to undertake a 24hr banking transaction such as cheque withdrawals, international transaction processing of draft etc. ther financial services can also have the sale of shares; bonds done on a 24hr basis. Closing periods of the foreseeable future will gradually be extended to a time that will make financial institutions to undertake multiple shifts such as day shifts and night shifts. These only will be made possible with the use of computers that will be ready to run on a 24hr service to its customers. CHAPTER THREE METHODOLOGY This chapter discusses the research techniques and methods employed in collecting data for the area of study. . 1RESEARCH DESIGN The type of research conducted is exploratory. This is where research is conducted into a research problem or issues were there are very few or no earlier studies to which we can refer for information. The aim of this type of study is to look for patterns, ideas or hypotheses. 3. 2POPULATION OF THE STUDY In order to achieve the purpose and objectives of this research work, the following functional areas were identified. ? Management ? Finance(Accounts Section) ? Information Technology(I.

T. ) department All staff of the above mentioned areas in Ecobank formed the population of the study. 3. 3SAMPLE SIZE AND SAMPLING PROCEDURE The researcher used simple random sample technique to select twenty (20) respondents. Nine (9) members of staff were selected from the Account section, two (2) from the IT department and five (3) from the management team. Those chosen were people the researcher believes could provide the right and needed data for the study. 3. 4DATA COLLECTION METHOD

Due to the nature of the study, questionnaires were administered to the management and staff of Ecobank Kumasi branch as well as interview. Observation was also used by the researcher in collecting data. The following are the details of the methods used; 3. 4. 1Questionnaires The basic means of collecting data for the study was through questionnaires. Twenty (20) copies of well – structured questionnaires were distributed to the target population. Each respondent was given a copy. The respondents were given one week to answer the questions after which they were collected.

Questionnaires were made in such a way that it was so easy to understand by the respondents. 3. 4. 2 Observations and Enquiry The researcher observed that the answers provided by some of the respondents revealed additional information which was not provided in the questionnaires. The distribution of questionnaires directly to respondents also offered the researcher the opportunity to talk to some of the respondents and to elicit relevant information. 3. 4. 3Interview The one- to –one method, also known as the face-to –face type was used.

This was concluded with the finance managers, to accounting personnel’s as well as the IT Managers of Ecobank who in one way or the other makes use of computers in their field of work. The interview was undertaken using a semi – structured form of questions concerning the whole idea of the impact of computerization of accounting systems on the operations of Ecobank. The use of the interview approach especially allowed for maximum flexibility and paved the way for the interviewee to really reflect the use of computers in accounting systems.

The method yielded greater responses and brought out higher quality information that would not have come to light. On the other hand information coming from staffs reveals that Ecobank recorded about three hundred deployment rate of its personnel as a result of computerization. 3. 4. 4 Secondary Data These were gathered from Ecobank’s Annual Report, previous research works as well as library materials. 3. 5 DATA ANALYSIS The data collected were analyzed using the descriptive statistics approach. The answers to the questions were sorted out tabulated and analyzed using percentages.

The data analysis in chapter four reflects the Fourteen (14) questionnaires out of the twenty questionnaires (20) administered to the Ecobank Adum Branch Kumasi as well as interviews and observations made by the researcher. CHAPTER FOUR Data Analysis and Result In this chapter, data collected through the administration of questionnaires at Ecobank has been analyzed into tables of absolute figures and corresponding percentages. Twenty (20) questionnaires, each containing thirteen (13) questions were administered. Fourteen (14) were completed and returned giving a response rate of 70%.

Table 1 Rate of Response |Subject Group |Number of respondents |Percentage (%) | |Management |3 |21. 4% | |Information Technology |2 |14. 3% | |Account staff |9 |64. % | |Total |14 |100% | Source: Field survey data May 2009 Chart 1 [pic] From the table and the chart above, three (3) were received from management personnel, representing 21. 4%, two (2) from the Information Technology Department representing 14. 3% and remaining fifteen (9) were recovered from the Account section representing 64. 3%. This was enough for the research study. Table 2 Computerization of accounting system. Response |Frequency |Percentage (%) | |Yes |14 |14 | |No |- |- | |Total |14 |100 |

Source: Field survey data May 2009 From table 2, fourteen (14) representing 100% stated that they have fully computerized the Accounting system. Concerning what prompted the project, answers received from respondents were to enable them satisfy their customers with their services. With respect to the major problems encountered in the computerization of accounting system, the response is shown in table 2 Table 3 Problems encountered on computerization of accounting systems. Responses | Number of Respondents |Percentage (%) | |High cost of Training |7 |50 | |Lack of experience |4 |28. 6 | |Delay in production |3 |21. | |Total |14 |100 | Source: Field survey data May 2009 Chart 2 [pic] Table 3 and chart 2 depicts that seven (7) of the respondents representing 50% were of the view that the cost involved in the training of staff to meet the new technology is high. Four (4) of the respondents representing 28. 6% also claimed that the staff lacked experience in the use of computer technology.

The final, which is delay in production which represents 21. 4% were also of the view that production after the computerization process delays. Table 4 workload after computerization |Responses |Respondents |Percentages (%) | |Increase |2 |14. 3 | |Decrease |9 |64. | |Normal |3 |21. 4 | |Total |14 |100 | Source: Field survey data May 2009. Chart 3 [pic] From table 4 and chart 3, two (2) of the respondents, which represent 14. % stated that the workload after computerization process in the bank has decreased as a result of computerization. Nine (9) of the respondents representing 64. 3% were of the view that the work load of the bank has decreased. The final groups of people were also of the view that the workload after computerization is normal that is there is either increase or decrease in the workload after the introduction of computers. With respect to special accounting package in use, the responses are shown in table 5. Table 5 Accounting package Responses | Number of Respondents |Percentage (%) | |Yes | 14 | 100 | |No | – | – | |Total | 14 | 100% |

Source: Field survey data May 2009 From table 4 all the fourteen (14) respondents stated that there is a special accounting package in use and gave the name as Flex Cube. It was stated that it helps in storing data and providing good report. Lastly with respect to what staffs like about the manual system that the computerized accounting system could not provide, the respondents gave the view that the manual system has no capital cost involved in processing data and that the cost of maintenance is low as compared to the computerized system.

The researcher asked whether there would be a total computerized accounting system in other branches in the country. The response is shown in table 4. 6 Table 6 Total computerized accounting system | Respondents | Respondents | Percentage (%) | |Yes |10 |71. 4 | |No |4 |28. | |Total |14 |100(%) | Source: Field survey data May 2009 Chart 3 [pic] From table 5, ten (10) of the respondents which represents 71. 4%, stated that there will be a total computerized accounting system in the next five to ten years to come. Four (4) out of the fourteen respondents representing 28. % stated that there can not be a fully computerized accounting system in other branches because of lack of adequate power supply in the country. THE IMPACT OF COMPUTERIZATION ON ACCOUNTING SYSTEMS From the interview conducted with the management of Ecobank, these were the responses gathered concerning the impact of computerization on accounting systems; Management were of the view that , the whole concept of the use of computers has been that of great delight for both benefactors and end users thus customers and staff of the financial institution involved respectively.

Though initially for staff it was met with great resistance as it was seen to cause unemployment generally, but this has finally been accepted as working tool of which they have expressed their satisfaction in its works or activities so far. It was also revealed that customers received the new move with all joy, as they believed that less time was to be spent in the banking activities. It was made known that the use of computers received both approval and criticism.

In much the same way, one can truly say that now the impact of computerization is seriously being felt in the banking activities such as fast service delivery, up to date and accurate database leading to quality results. The impact can also be looked at from the area of the transactions being undertaken by each company, the time taken to complete a transaction, the quality of account and report presentation, meeting needs of customers. Though the positive impact has been looked at, there is the need to also look at the negative aspect of computerization.

Management made known the negative aspect through the interview conducted that, the cost element involved in maintaining the computers, delays by servers leading to a halt in the banking activities, training of personnel is also costly, modern software’s and the purchase of standby generators cannot be overlooked. IMPROVING THE POSITIVE EFFECTS An interview conducted with the Information Technology manager of Ecobank, Adum branch revealed that, it is important for anything that produces good reports and results to be improved upon to ensure further advancement of its effects on anything in general.

Some of the ways of improving the positive effects of the computerization were made available as have been enumerated below. First of all, the introduction of new technology to build upon the existing ones is an area which must be brought in to reduce the negative effects of computerization. On the side of customer’s, the financial institution will have to make delivery swifter with more and more innovations being put into place for example where the ATM will be placed at vantage points in and out of the city, modes of withdrawals such as the mondex card, e-card and e-zwich.

Any other form of credit card or master card should also be encouraged among clients, such that there should come a time where one can check his account even from the house on any normal phone. New technology will however mean that obsolete software’s being used is to be exchanged with newly advanced ones to bring out the real effects of computerization. Additional codes will have to be identified to ensure areas of extension of the computerization process.

Further more, once computerization is helpful, the institution is seeking to spread its use within the financial institution, where each of the branches would be connected through a more recallable networking system. CHAPTER FIVE SUMMARY, CONCLUSIONS AND RECOMMENDATION SUMMARY The computerization of accounting system has really come to stay for which further developments are expected in some few years time such the Automated Teller Machine (ATM) van. Manual accounting systems has not been eliminated completely but reliance and dependency on them has been reduced drastically due to the emergence of computerized accounting systems.

While many financial institutions responded quickly to the use of computers in accounting systems, others still face difficulties in adopting computerized systems of accounting. Most organizations have resorted to the use of computers in their accounting systems because of the inherent accuracy and processing speed of this automated accounting system. . There is generally a calm atmosphere in financial institutions since the whole idea of computerization has now been accepted and is seen as causing higher returns for the Staff and management of Ecobank.

The computerization system has brought about an ease on the hectic and tedious work formerly done manually by financial institutions. Paper work has considerably declined but not completely wiped out for the sake of auditing purpose and other reasons. The computerization of accounting system is setting the pace for other non-financial institutions to even see the need to computerize their accounting system in their financial departments, thereby taking a global turn.

The activities of certain viruses such as car are not felt much as they are all dealt with by the manufactures whereas others cannot be easily noticed on time hence disrupting activities. Backup systems are therefore kept by these financial institutions to help mitigate future problems that are likely to emerge incase computers are infected with viruses and all important documents corrupted or crashed. Ecobank has been able to build up a backup system at Accra which stores all of its information which is retrievable upon any loss of data from any computerized branch.

Upon misplacing ones ATM card the only way out is to re-apply for a card at a cost, which will be charged to the account of the customer. That not much information exists with respect to the computerization of accounting system in general let alone on financial institutions. Not much problems are being faced in the use of computers for accounting work as such allowing work to go on smoothly despite certain hitches here and there. In other to satisfy customers of Ecobank, 100% of the respondent states that Ecobank branch at Adum has computerized its systems fully. 71. % stated that there will be a total computerization of their accounting systems in the next five to ten years. This can be possible if there is adequate power supply in the country. 64. 3% stated that Workload in the bank has decreased as a result of computerization. 100% also that Ecobank has a special accounting package in use called Flex Cube. This helps in storing data and provides good report. On problems encountered on computerization of accounting systems 50% of the respondents stated that cost of training of personnel or staff was high as compared to the manual system, whereas 28. % stated that staff also lacks experience and the rest stated that there is a delay in production. It is also emphasized that the cost of maintenance is high as compared to the manual system of operation. Finally the impact of the computerization of accounting system is seen more on its benefits that are yielding fastest information leading to quick decision making than on its negative effects which is basically the cost of acquisition of the machines and deployments of staff among others. From the research findings, CONCLUSIONS The study revealed the main forms of hardware being used by Ecobank in their operations.

These include the mainframe and the micro computers. On the other hand, some of the software also used by Ecobank includes the Tally, the Aptra the Hawk and the Pips. The more sophisticated ones which include the Aptra, the Hawk and the Sparrow are computer software used by the Automated Teller Machine (ATM). A pip on the other hand is a software that deals with the micro processing of cheque related activities. Upon the research conducted, it came to light that, the whole concept of computers has been of great delight for both benefactors and end users being customers and staff of the financial institution involved respectively.

The introduction of computerized accounting systems on the operation of Ecobank has enhance fast service delivery, up to date and accurate database leading to quality results hence satisfying their customers. Computers are used in financial institutions in general day to day gaining recognition with respect to what it is able to do and what problems it is able to solve. The issue has caused the whole financial sector to aim at the ultimate i. e. the use of computers in its activities. But an organization must now face the practical problem of streamlining and speeding up the asic accounting system so that the accounting department can keep pace with the rapid flow of transaction in the modern businesses. Even though there are problems to be addressed, the computerized accounting system is cherished by all users in the accounts department of these financial institutions who would like to cling to the computers than to go back to those hectic days of the big books of the manual system. Though it caused some level of discomfort such as causing about 35% deployment at Ecobank on the whole it has been a profitable venture .

The impact of the computerization of accounting systems on the operations of Ecobank is a never-ending story due to frequent technological developments that keep occurring within short periods of time. RECOMMENDATIONS 1. Upon the interview conducted and responses from questionnaires received, I would want to make the following recommendation for serious consideration: 2. Technology should be more advanced in solving the problems in situations where customers will have to re-apply for the ATM card due to missing pin number or forgetting it. . Staff computer skills should be upgraded frequently as new development on technology keep on springing up to be able to meet current trends in the market. 4. There should be the formation of committee’s on the I. T sections of these financial institution that will monitor the market in the areas of new innovations that are bound to arise in the future coming up in the financial industry for them to study it and see how best they can adopt and implement it in the heat of competitions existing in the market. 5.

ATM machine should be placed at strategic points within selected areas which will enhance its influence in the work of financial institutions . in doing so constant repairs and in filling the machine sufficiently with physical cash should be done frequently to ensure smooth operations. 6. Scholars, authors, and others should be encouraged in the writing of books, magazines and newsletters on the introduction of computers or automation in financial institutions as almost all the information technology in general as such does not really relate to the topic in discussion. 7.

That situations where the ‘server goes down’ should not be left unattended to but that all efforts should be marshaled to ensure that it is very minimal to really experience the true impact of the computerization of accounting system in financial institutions. 8. The public relations departments of all financial institutions should make known to the public by way of advertisement and other sources to really bring out the easiness in using these products, such as the use of the ATM card for savings accounts, cash withdrawals and checking of balance, e-card and monde card for shopping in designated supermarkets throughout the country. . Manufactures should rectify software which is defective in order to ensure continual flow of work output. This however will be made possible when warranties have given, concerning the software among other things 10. There should be routine procedures and schedules for maintenance and repairs of broken down machine to ensure that all the times they will be in good condition to deliver in terms of meeting customers’ needs especially in the area of the ATM. DEFINITION OF TERMS ACCOUNTING SYSTEM: The system that provides the information for us in conducting the affairs of the business.

CODE HOLE: It referred to as a computing programming term that makes accounting packages easily recognized in the areas where an extension on the software is. COMPUTERIZATION: The process of replacing computers with the manual system hence uses electric means to achieve a stated object or work. COMPUTER: Is a general purpose and automatic electric information processing machine. COST ACCOUNTING: Is a conscious and rational procedure by accounts for accumulating cost (however defined) and relating such cost to specific products or departments for effective management action.

FINANCIAL INSTITUTION: Institution that carry out its activities in the form of financial nature. For a examples banks, insurance and financial service providers. FINANCIAL ACCOUNTING: The branch of accounting that is concerned with the recording of transactions using generally accepted accounting principles for a business enterprise other economic unit and with a periodic preparation of various statement. MANAGERIAL ACCOUNTING: The branch of accounting that uses both historical and estimated data in providing information which management uses in conducting daily operations and in planning future operations A-6.

PRODUCTIVITY: Is the rate at which a company makes goods which is usually judged in connection with the number of people and the amount of materials necessary to produce the good. SERVICE BUREAU: Is an organization that undertakes to install computers and computerize accounting for financial institutions. I. T. Information technology. NCR: National cash registry – A company that deals mostly in the computerization of institution such as bank, ministries, school etc. ATM: Automated teller machine. CAAT: Computer Assisted Audit Technique, where the computer is used as a tool in the process of undertaking an audit work.

LAN: local area networking WAN: Wider area network MLRP: Manpower Labour Rationalization Programme EDP: Electronic Data Processing PC: Personal Computer E Card: Electronic Card APPENDIX QUESTIONNAIRES FOR STAFF AND MANAGEMENT OF ECOBANK TOPIC: THE IMPACT OF COMPUTERIZATION OF ACCOUNTING SYSTEM ON THE OPERATION OF ECOBANK. The purpose of this study is to enable the researcher gather information on the attitude, perception and practice on the computerization of accounting of software in your institution.

It is purely academic work therefore all information provided would be treated as such and confidentially. Where answers are provided please tick [ ] as appropriate and where answers were not provided please kindly supply the information. 1. Have you fully computerized your accounting system? Yes [ ] No [ ] If yes, what prompted the project? [ ] Reduce Workload [ ] Increase Productivity [ ] Customer Satisfaction Others Specify………………………………………………………………………… 2. Have the entire problem in the financial institution been solved? ] Fully [ ] Partially [ ] Not 3. How long have your accounting system been computerized? [ ] less than 5 years [ ] 6 – 10 years [ ] 11 – 20 years Others specify ………………………………………………………………………….. 4. What major problem did you encounter in the computerization of your accounting system? [ ] High cost of training staff [ ] Lack of experience [ ] Delay in production Others ………………………………………………………………………………………… 5. What steps did you take or have been taken to salvage the situation? ……………………………………………………………………………………………………. . Was there any staff deployment due to the computerization? [ ] Yes [ ] No If yes, what effect did it have on the institution? [ ] Work overload [ ] over taxation Others ……………………………………………………………………………………….. 7. What is the ratio of staff to computer since the introduction of computerization? [ ] 1 : 1 [ ] 2: 1 [ ] 3: 1 Others…………………………………………………………………………………………… 8. Is there any special accounting package in use? [ ] Yes [ ] No Which software…………………………………………………………………………….. 9. What is the effect f computerized accounting system on your productivity? [ ] High return [ ] Break even [ ] Low return 10. What do you like about the manual system that computerized accounting system could not provide?……………………………………………………………………………………. 11. Are you facing any problems in the use of computers for accounting purpose? [ ] Yes [ ] No If yes, in what areas [ ] Obsolescence [ ] Difficulty in retrieving information Others……………………………………………………………………………………………………….. 2. Can there ever be a totally computerized accounting system in other branches in the country? [ ] Yes [ ] No If yes, how long [ ] 6-10 years [ ]11-15 years [ ] 16-20 years Others……………………………………………………………………………………………. 13. How do you see the workload after computerization? [ ] Increase [ ] Decrease [ ] Normal Interview questions for the management of Ecobank 1. What is the profile of Ecobank Ghana Limited 2. What is the history behind the computerization of accounting systems in Ecobank 3.

Does Ecobank have a fully computerized accounting system? 4. What prompted the introduction of computerized accounting system? 5. What was some of the problems they encounter? 6. What was the attitude of their worker BIBLIOGRAPHY Nsouli, (2002), challenges of the E – banking revolution. Sangster, (2002), business accounting Sangster (1992) strategies for Business Decisions 2nd edition Koerber k. (1992), accounting systems Hilton (1994) cost management accounting 2nd edition Bagronoff (1996) Decision support tools for choosing accounting software Ecobank Annual Report

Fundamentals of Business Systems Development Human Resource Refigure ration Theron A. Wilson December 12, 2007 University of Phoenix BSA/375 Chloris Wright Riordan Manufacturers are looking for the redesigning of their Human Resource department. This will involve the transferring of their legacy system into a more advance human resource networking system. The company is asking for a proposal that will describe the techniques that will be used in order to gather the information that will be needed for the transformation.

Also, the proposal will give a detail analysis that will be included in the design methods that will be involve in the configuration of the new system. Within the proposal, there will be a listing of the key factors that reinsure the organization that the information that was obtained was gathered successful. And as the conclusion, an explanation of the scope and feasibility of the project will be exhibited. The process will be implemented a collaboration of phases within the systems development life cycle.

The initial process begins with the developing a team that will be design to handle any situation that may come during the course of the project. This part of the process is prudent in order to accomplish the goal of the project; in which is the successfully redesigning the H & R department of Riordan. Therefore, with the collaborated efforts of the team and Riordan’s I. T. department, the process will be implemented in a collaboration of phases that is established by the systems development life cycle. The beginning of the cycle involves the planning phase.

Defining the problem will be the first agenda that will be address in the proposal. Riordan’s Human Resource department is the problem domain. It is currently composed of independently-filed paperwork that is maintained by each managerial personnel. Managers are also responsible for the tracking of FMLA absences. A change to any employees’ information is submitted onto special forms by the employee’s manager and process by the payroll clerk. Training and developmental files are established on an Excel spreadsheet and is maintained by the training and development specialist.

Records about the workers’ compensation are maintained by an independent contractor. Each recruiter maintains applicant information for open positions. Resumes are filed in a central storage area, and an Excel spreadsheet is used to track the status of applicants. The compensation manager keeps an Excel spreadsheet with the results of job analyses, salary surveys and individual compensation decisions. Employee relations specialists track information about complaints, grievances, harassment complaints, etc. in locked files in their offices.

The problem that exists within the human resource department is the absence of an automated networking system. Second, there is not limitation set on those who should be included in dealing with these confidential files. Next, there is not a centralized hub established that can maintain all of the records that need to be kept about the employees for Riordan. Third, the contracting of a third party provider to maintain confidential records of each individual that work for the Riordan Manufacturers is probably is not the best alternative to maintaining the security of the individuals’ information within the organization.

The production of a project schedule will be the produced to document the design of the project; the guidelines that they will follow; and the timeline that will be executed in order to meet their goals. The project will begin with the evaluation of Riordan’s I. T. department. This information is required to gain information about the company’s computer and database system in order to see that system can use or handle the upgrades that will be necessary in order to update the H & R department. In order to establish this goal, the staff will be used to gain information in order to guarantee the successfulness of the project.

Information will be gathered by way of completing questionnaires that will be given to users of the system. Once the questionnaires have been evaluated, the team will proceed with determining what will be needed with the H & R department. Once this part of the plan has been executed, the team will developed a proposal to present to Riordan Manufacturing. Once the previous steps has been initiated, there would be a meeting with the corporation is in order to determine the budget for the needed recommendations as well as to determine the length of time the corporation is requiring for the team to be able to finish the proposed upgrades.

This is crucial because this will determine the set budget that the team will be obligated to use during the transformation; in which the proposed budget for this operation is set at $150,000. The proposed time will set at three months. The next step is the documenting of the project plan at this stage of project development will help team members adhere to the established strategy, schedule, budget, and definition of quality during the course of a project. The records will reflect the project overview. Within the project overview, there will be a detail description of the project scope and technical information.

Then the team will record the project’s strategy, schedule, budget, quality definition, and compile the information into a management plan that will be distribute amongst the team member. Once the previous stages of the cycle have been met, the team will decide if the scope of the project, and in conjunction with the set innovation budget established by Riordan, is feasible to achieve the renovations that are required for the H & R department. The team has established that need for the renovation is relevant for Riordan Manufacturing. Second, the team have established that the proposed renovations will is definite a need for the Riordan.

A simulation of the proposed system is suggested to be carried out to predict the outcome before the actual project starts. Now the team will develop a written quotation that will acknowledge the quotes from the suppliers and technicians to guarantee that the renovations will not exceed the set budget. Once these conditions have been met, the team will instruct the manufacturer that the conditions have been met and set a date of which the operation will begin. To begin the next phase, the team will design an architectural design to establish the layout of the proposed plan.

This process will give a detailed description of how the H’s activities will be performed. The system analyst will also include a description of the information system’s architecture in accordance of the data, processes, interfaces and network within his or her report. The system analyst’s primary goal is to eliminate H&R’s processes that is comprise mostly of paper forms or electronic files that scattered throughout different departments that do not link together. The goal is to put in place a fully automated HRIS that achieves improvement in the accuracy and currency of data.

Also, the system will allow the tracking of individuals that are moving throughout the Riordan’s system. Furthermore, the system will be able to quickly aggregate, analyze, and use data in more of a real-time transaction. It will be able to give projections of potential needs of the workforce; while decreasing the labor requirement that is currently employed within the H&R department. The system analyst’s plan is to design the HRIS system using a distributed architecture. This particular architecture is design with the amenities that are required to develop a more centralized H department.

The H central location will be at the corporate office. The corporate will be the site of the centralized mainframe computer that is server-based. This will allow user to access date concurrently within a secured environment. Data will be store on a centrally-based database unit. The database unit will allow easier updates, searching and analysis of information collected within the system. Another characteristic of the new system will include web-accessibility. Web-accessibility will allow the interactions amongst the Riordan’s HRIS system to be access by way of the Internet.

This will eliminate the installation of client applications to each users’ individual desktop; and at the same time, reduces the time that is involve in deployment and training requirements. This procedure will allow immediate accessibility for anyone with an Internet or LAN connection. The new system will allow scalability and extensibility. A system of wireless devices will be installed in each location. This will allow the H department to network with the other facilities; hence, developing a LAN. Once this procedure has taken place, a Wan will be developing to connect all of the facilities to the corporate location.

Any user or outside entities will have access to information through the Internet. An intranet will be established for those that are employees of Riordan. Password-protected login logarithms will be put in place for security stability. There also will be role-based accounts set up to prevent non-authorized staff from the viewing of confidential data that only should be access by upper management positions. The new system design will provide HRIS with total automation; thus, providing a standardization of all manual processes.

The upgrades will be performed on the current network at all three facilities, chronologically, to ensure implementation of the system is accomplished without any issue. Now the design of the new H & R department has been established, the team will now begin the project. Riordan has approved the proposed plans and now it is time to begin the implementation phase of the project. During this process, the team will be implementing the proposed plan using a strict process that will allow them to be aware of any problems that they may face while executing the plan.

The process will take an approximately 6 months, allowing the team to deal with the formalities of the process and the geographical areas that the team. This process involves six points of implementation: (1) coding, (2) testing, (3) installation, (4) documentation, (5) training, and (6) support. The application that is being installed will allow the H & R department to communicate by way of the Internet or Intranet. The team will begin at the corporate office first. The team with the collaborated efforts of Riordan’s I. T. department, with begin initializing the new applications to one of the servers.

This will allow the team and the I. T. department to analyze the performance of the new application within the system. Once the application has been tested, the team will direct the technicians to proceed onto the remaining servers. This process will be documented to assure that it was successful. Afterwards, the process of re figuring each of the desktops will be initiated. During this process, the team will be programming the computers to accept the new that was installed in the servers. A build and smoke test will be use by the programmers to eliminate any errors within the application.

Once the programmers have acknowledged that the process has been tested and documented with no errors, then they will proceed onto the installation process. The installation process will involve installing wireless devices among their Ethernet connections. There are two benefits for the installation of these equipments. First, the Riordan organization will be establishing a WAN amongst their companies in America as well as Japan. Second, the processes of the H & R department could be executed through the company’s Intranet cite. This process involves connecting the wireless bridge to where the current modem now resides.

Afterwards, each computer will be program to accept the new signaling that will be established with the installation of the wireless devices. Once the previous process has been established, the team will finally begin the process of transferring of the legacy files onto the new system. The team will outsource this project. The outsourced team only job will be to gather all of the paper files and old data that was store in the server and apply them to the new application. This procedure will be somewhat timely, but will not exceed the budget. While trying to achieve the expectations of an utomated H & R department, the team will initiate a parallel operation. The team will is using this process to eliminate the risk of system failure and losing all the data that was inputted by the outsourced team. This process will last about two weeks to give the team to analyze and rectify any situation that may happen. The team will now begin to document the response of the new system. If the previous process goes according to plan, then the team will begin the training process. The team will train all the users of the new system, as well as some of the I. T. professionals that work for Riordan’s corporate office.

The training process will take approximately two weeks. The ultimate goal of the training is to allow the users to understand the new system. The employees will be trained on different areas such as setting their login logarithms, as well as the navigation of the website. These training will also be documented. The team with create a support staff for that will be trained for quick response time. The support staff will also be able to initialize performance tests. The staff will be on-call and also can be reached by way of email. Also users can fill out change request and error reports to the support staff.

These requests will be evaluated and performed in a sense of urgency manner. Their will be quality assurance personnel embedded within the organization to assure the quality of the new system. The team will place an on-site technical support person to handle situations that may occur with the operation of the new system. Reference Kelly Ph. D. , John C. (2001). A comparison of Four Design Methods. Department of Computer Science, Furman University. Retrieved November 25, 2007 from www. furman. edu/computerscience. University of Phoenix. (Ed. ). (2004). Creating Satisfy Customers [University of Phoenix Custom Edition e-text].

American Marketing Association. Retrieved November 25, 2007 from https://ecampus. phoenix. edu/secure/resource/resource. asp. University of Phoenix. (Ed. ). (2005). Project Planning and Feasibility Analysis [University of Phoenix Custom Edition e-text]. AllenWeb. Retrieved November 25, 2007 from https://ecampus. phoenix. edu/secure/resource/resource. asp. University of Phoenix. (Ed. ). (1990). Qualitative Educating and Research Methods [University of Phoenix Custom Edition e-text]. Sage. Retrieved November 25, 2007 from https://ecampus. phoenix. edu/secure/resource/resource. asp. Human Resource Configuration

One of the articles deals with the fact that young students are addicted to sexting. And lastly, one paper deals with the decrease in printed materials. In fact, this paper is a research work on the dependency and independency of humans on information technology. Is information technology becoming the primary necessity of our existence; as we are getting dependent on it? “Could you please hurry up? I’m getting late” a customer is a renowned super shop is becoming restless due to the long queue in the payment desk. But what happened?

Why has everything halted suddenly? It was just a case of system failure, which stopped all the works inside the shop and the cashier was unable to make the bills, as the bar code reader and all other software were not responding. As a result, the waiting list got longer and created chaos inside the shop. Look, how such a simple system failure is creating so much distraction in our life. The above situation was just an example from a super shop, but it is not the only thing based on information technology. In fact, most of the things in our country are now based on information technology. Even if the world recognizes Bangladesh to be a poor, developing country with many people living below the poverty line, the usage of technology is considerably high. In a report published in Internet world statistics, the author (2010) stated that the number of mobile phone usage increased from 100,000 to 995,560 with the rate expanding from 0. 1% to 0. 6%, from 2000 to 2010. Nowadays, cellular phone usage has become very common amongst the lower class in our country. Also, offices and stores are relying on technology for storing their records and dealings.

Moreover, students have become dependent on the Internet for searching for essential information. Why are we using this information technology? Because this technology makes our life easier, for example, it enables us to communicate with others at a distance within a second, IM and video conferencing are allowing us to be in touch with our relatives staying abroad, and that also for free; only the line rent is enough to let us exchange few words with our relatives. In addition information on the Internet are allowing us to get updates in a matter of seconds. Even if it is providing us with ample benefits, it is giving rise to dependency. I strongly believe that people are getting over-dependent on technology, as these facilities are making us inefficient in manual work procedure, handicapped without technology, and it is also becoming the main reason for wastage of money in the case of the young generations, though IT is providing us a less time-consuming lifestyle, low cost communicating facility and a digital way of refreshment.

Just recall the previous times, when we were not touched by the digital life system; what happened at that time?

Students did not got any help from the internet for their assignments, in spite of that they did their assignments and other works, they were not thrown out of the institutes for getting bad grades. Scientists, doctors, engineers were born previously; they also did their research works, as well as new inventions. They worked hard, without looking for something simpler they went through the printed books, to gather information for themselves; but nowadays students cannot even think of doing their papers without the help of the technology, they are becoming inefficient to go through the manual working procedure. As time changes, we are getting new technologies to improve our lifestyle, as for example, now assignments, projects, and other brainstorming works are easier today. Just type the word and click to search anything about the related topic in Google (the most efficient search engine). According to Dingle (2010), Google did a revolution in the business sector by starting its journey of giving free service to search for information in its sites, and day-by-day Google is expanding its services. Google obviously makes our life easier, and that is why students tend to rely upon it for their academic purpose. Zillien and Hargittai (2009) did a survey on different types of Internet usage on the various classes of people in the society; the most common usage amongst all the groups of peoples was email and search engine usage. From the higher class to the lower class, everyone is dependent on Google, as almost 86% of the sample replies to it, and above 90% responds to the email usage. Karen et al. (2010), says students are getting dependent on the electronic and search engine sources mostly from 1996 to 1999, as between those years, the number of printing sources like books decreases.

All these experts are telling us about the efficiency of IT in our lives, where we are actually becoming more inefficient. Most of the companies and offices are using IT to maintain all their documents, records, and dealings. They said that IT is helping them to maintain all the complex works in a simpler way. For example, Apollo Hospital is a worldwide chain hospital, which has opened into our country recently. An employee of the hospital was asked about the system maintenance of the hospital, and he answered that from the appointment to pharmacy billing, every single thing is maintained by the IT system. They have interred linkage within the computers throughout the hospital, and everything is monitored centrally. All the patients and staff have got different numbers and servers where all information about them is saved. Then the question arises, what would happen if the system fails for one day? The employee becomes silent and says we cannot even think of the system failure for one hour, and it is impossible to run a day without these systems.

The employee was also asked whether there is a manual system, in case of emergency in the hospital, he says no; by chance, if there is any system failure, nothing can run on that building, patients would have to wait for getting prescription as well as their appointment. He also said that “we are handicapped without technology”, as they cannot perform any of the action without computers. Though IT allows them to maintain all the things very swiftly, it also makes them be dependent o it. The most surprising fact is that humans invent technology, and now they cannot proceed without the technologies. Nowadays, almost every people confess his or her dependency on IT, while in a survey people of different ages were asked about this dependency, and according to the figure 7, 62. 5% of the people said that they are dependent on the information technology, and figure 5 says that 100% of the people cannot imagine themselves without their cell phone or laptop. So, we can say that IT is making us handicapped, as often we cannot work on their unavailability. The young generations of today are now up to date with all the latest technology available. They are getting dependent and wasting money to buy different gadgets. Dingle (2010) gathers information from the research firm Gartner, where the author found that Global IT has spent US$1,4 trillion, from where a huge amount of money went for both hardware and software, which in turn helps us by increasing the availability of computers in almost every corner of our lives. We are progressing, and new inventions are coming every day; companies like Apple, Nokia, Blackberry and etc. are contributing a lot to serve the necessity of the young generations. Dingle (2010) cites the research of Gartner who expects that the customers will spend quiet about US$6 billion to get mobile applications.

Computer invention is believed as a revolution in the world, it was made for human beings, to make their life easier, faster, and more comfortable. Many people believed that before we wasted most of our time by being in a manual system, whereas those works can be done within a moment. From figure 7, we can see that 76% of the people said that information technology is making our life easier and faster. Students from different universities and institutes say that without information technology it would be much harder for them to complete the assignments and other research works. These technologies are allowing them to communicate experts worldwide, whenever they need they can go to the web sites and gather their required information. The students argued that they have lots of works to do, for which they need to be multi-tasking. And information technology is giving them a route to be successful in their life. But if we consider the ancient times, people were also successful at those times, scientists, engineers, researchers also did their challengeable jobs at those times. Without the help of information technology, they did work hard and become successful in their lives.

Again students said that at that time, life was not that much competition, and for this current and present situation no one can work without the help of IT. While aged peoples said that, young generations do not want to work harder as they can get anything they want within a second. Nowadays it is familiar to get everything done by sitting in a computer, even products can be ordered on the internet, so our young generation is becoming lazy and inefficient because of IT. From Figure1 we can see that 64% of the people surveyed say that information technology is making us inefficient. What is the use of that life, which is making us unproductive to work of our own? “Time and tides ”, especially in this competitive world of ours, we cannot even think about wasting a single second from our lives. Everyone is in the struggle to do well in their life and in order to get established, people are getting away from their close ones, sometimes they are going abroad to study or for a job. Information technology helps us to communicate with our loved ones from a long distance, and that is also at a very lower cost. But quiet about 57% of the teenagers said that they use cell phones to communicate with their friends. Not only that, but the awesome features of taking pictures in cell phone and uploading instantly on Facebook or Twitter is also quite famous among them. Text messages and multimedia messages are also a very popular way of communicating with peers. Corbett (2009), says about “sexting”, that is, while in a relation, girls send their nude pictures to their boyfriends, and after they break up, the boy uploads those pictures on the internet, and in this way teenagers are affected by the impact of technologies.

Usually, it is seen that adolescents use IT for most of their works, most of them are unaware of the intentions of their friends, and this is how IT is affecting our teenagers and adults. Lastly, adults and teenagers cannot even think of themselves without their mobile, computers, and all other entertaining devices. They believe that, life is becoming so busy, they did not get extra time to communicate with others, and there is also no extra time to play outdoor games or to hang out with friends randomly. As from Figure 3, we can see that 75% of the people say that they use IT also for their personal purpose rather than academic or officials, and in Figure 4, 82. 5% of people said that in this current situation IT is needed in every step of our life. Due to the lack of time, most of the peoples are now relying on the digital form of entertainment. As I have mentioned above, students are willing to spend money on buying gadgets for them. Movies, games music is now considered as a form of entertainment. Students are found to do chatting in messenger, while they are in class. In order to get all these facilities they often buy expensive mobile phones. Many people believe that this way of communication is decreasing the intimacy and values between one’s relation. Expenditure on the technologies is increasing, which in fact is reducing the development of all other sectors. For example, Bangladesh is a poor country, we have unequal distribution of wealth, many times higher class people support the lower class peoples for their survival. But as they are now up to new technologies every day, they are spending much money on their own.

Quasar monopolized the market with the creation of an all-optical imputer known as Neutron. Patents promote innovation for inventors, which allow exclusive rights to do business for a specific duration (McConnell, Bruce, & Flynn 2009). A patent for this new technology allowed Quasar to experience growth in revenues by setting the price as the only provider of an all-optical computer. Quasar established that marginal cost and marginal revenue were equal when selling each Neutron computer at $2,550 with quantities sold was at 5. Units. This helped Quasar determine the need for maximizing future profits to stay competitive with cost reductions in production. Oligopoly In 2006, Quasar was in an oligopolies market because they were already competing with Orion Technologies, a company that recently introduced their own optical notebook computers. During this time of competition, Quasar and Orion mutually stabilized the price for notebooks and both were generating profits.

As Orion Technology introduced their optical computer to market which resulted In a 50% consumption, Quasar decided that the price of the computer would drop to $1850, creating a profit of $207 and revenues equally $1195 million. Although Orion did make a dent in the optical computer industry they were not able to capitalize on the market. Despite the fact that they were holding the other 50%, they lost profits even though the revenues were equivalent to Quasars. Monopolistic Competition In 2010, Quasar was facing more challenges because of the variety of computer models introduced by other new companies.

They were in a monopolistic competition, and Quasar thought of another strategy to keep differentiated from their competitors. They allocated a budget of $200 million to invest in brand development. Because of that Ceres was born, another variation of the optical notebook. Ceres was specifically designed for a new end user, thus distinguishing itself from the Neutron. In a monopolistic competition, brand development Is vital for maximizing profit higher price for their superior quality products (Fischer, Violence, & Settler, 2010). Pure Competition The final market was the perfect competition.

Quasar is well established in the market in 2012. Quasar has obtained controlling interests in Optic for optical display screens (ODDS) technology. The competitive edge with Optic will increase revenues but will require continued innovation to avoid the profit loss. Using a similar strategy that Quasar used in 2005, profits can be maximized by lowering the costs of production. Because Optic operates in a pure competition market, revenue will increase but eventually the competitors will copy Optician’s example limiting the economic edge to a short period.

Conclusion In each market structure, Quasar made choices that were unique in the structures to maximize profits for each market. The choices made in a monopoly are different from the decisions that needed to be made in other structures. The simulation allowed the opportunity to see how market structure decisions impacted the overall profitability of Quasar over a p of several years. Our findings produced the best exults for Quasar under each organizational change occurring over a p of a few years.

No, the routing number is not defined by the bank but by the state and the type of institution where the account was opened. “Does everyone have the same routing number at the same bank” sounds impossible everything would be bewildering. You may even have different routing numbers in the same bank: for checks and deposits separately.

Answer the question what is the safest way to dispose of old bank account statements?

Case analysis:
Apple computers

1)      Historically, what were Apple’s major competitive advantages?

Apple was the first customer-centered, user-friendly computer to be launched on the market.  Since its launch in 1978, Apple has been synonymous with new design and innovation, and incorporating advanced technology into its gadgets.

Historically, these same unique characteristics have been the competitive advantages for Apple.  In the 1980s, Apple was the only computer to offer a colorful, graphic and sound enhanced interface.  This lead in multimedia technology gave Apple an edge in the fields of desktop publishing and education, where it had 60% and 80% market share, respectively.

Apple engaged in extensive backward integration, manufacturing its own chips, disk drives, and monitors.  The only component it sourced from outside were Motorola’s microprocessors.  This was a definite advantage in terms of building an individual brand identity and offered a complete desktop solution, something that its competitors could not offer at the time.  This one-stop, integrated product allowed Apple to sell products at a premium price, with gross margins averaging around 50%.  The one major drawback of this practice was that it limited inter-operability with other hardware and software systems.

Still, its ability to invent “cool” technology and making it easy and fun to use, was a major competitive advantage that made Apple highly successful in the 1980s.

2)      Can Apple’s problems in the computer business be attributed to the nature of the personal computer industry?  Analyze the structure and evolution of the PC industry and justify your answer.

The PC industry as a whole is a major factor contributing to the ascent or decline of the industry players.  Studying the industry life cycle helps provides a context for analyzing Apple’s performance over the decades.  When Apple I and II were launched, the PC industry was still at the introductory phase.  There was rapidly changing design and substantial variety within core PC functions.  This natural differentiation allowed contrasting products such as IBM and Apple to grow in the market.  The introductory phase also justified local production, and high prices of products.

The growth phase resulted in increasing use and demand of PCs in the market.  IBM’s open source technology allowed different hardware and software to be used, thus creating a higher demand because of choice availability.  The Windows operating system being used in IBM computers further increased its market share.  Apple formed a joint venture with IBM to develop a new operating system, a project that did not materialize in the end.  Apple therefore continued to use the PowerPC chips from Intel and the original Mac OS in their computers.  IBM-compatible computers also started being manufactured by independent vendors, who began to offer the PC at a much lower price compared to Apple.  In response, Apple launched the Mac Classic, a lower-priced computer to compete with IBM PCs.  Apple also licensed out its technology to independent manufacturers to make Apple-clones, in order to meet the rising market capacity and to make Mac computers ubiquitous, like IBM PCs.

However, these clones started to cannibalize Apple’s market share, and in a short time, they reached 20% of Macintosh’s unit sales.  By the time Apple retracted the manufacturing and OS licenses for Macintosh, the PC market was already reaching the maturity stage.  PCs were becoming commoditized, and there were fierce price wars caused by the entry of low-cost manufacturers.  The only PC manufacturers that generated a good profit margin were those with superior cost-efficiency or high-end innovation and design.  This was a primary reason why Dell achieved tremendous success.  Manufacturing efficiencies could not be improved beyond a point, so Dell focused on streamlining its distribution chain.  It started offering “customized PC” solutions, which would not allow more than a few days’ worth of inventory to be stocked in its warehouses.  This dramatically improved the costs arising due to overcapacity and obsolescence.  Apple, on the other hand, had neither been focusing on innovation, nor on supply chain efficiency until much later.

The life cycle and nature of the PC industry therefore was a big factor in determining Apple’s performance.  The sharp decline in revenue and market share could have been avoided if Apple had staying ahead of the curve and continued to tap its resources in innovation and advanced technology.

3) To what extent did Apple’s strategies contribute to its poor performance in the PC business?  Evaluate the strategies under Sculley, Spindler, and Amelio to explain and justify your answer.

Apple underwent substantial strategy changes with each of the CEOs that succeeded Steve Jobs.  Sculley started by aggressively marketing Apple’s capabilities in the desktop publishing and education sectors.  He intensively pursued the marketing efforts for Apple, highlighting its superior software and peripherals.  Under Sculley’s leadership, Apple sales reached $5.6 billion, and it became the only significant alternative to IBM on the PC market.

However, Apple’s high cost-structure became a major problem when the prices of IBM-compatible PCs dropped.  To counter this, Apple launched the Mac Classic, a lower-priced computer to compete with IBM PCs.  Apple also launched the PowerBook notebook computer, which received highly favorable reviews.

But instead of pursuing these promising concepts, Sculley chose to form an alliance with its rival IBM, for creating a new operating system, and also committed to switching from the Motorola chip to IBM’s PowerPC chip.  He also introduced the first PDA on the market, believing that Apple’s expertise in user-friendly, creative software would be very beneficial as PCs converged with consumer electronics.  In the strictest sense, Sculley’s ideas were actually good, and represent much of what Apple has done in the past five years.  However, Sculley’s ideas were ahead of his time, and he focused on rolling out new products and changing core components of the Mac, when he should have been focusing towards cost-cutting and developing a lean supply-chain system.

Spindler succeeded Sculley as Apple’s CEO.  He concentrated on completely different objectives from his predecessor, modifying Apple’s strategy and focusing on increasing market share.  Under his leadership, the IBM-Apple project was shelved, for which $500 million had already been spent.  Apple also licensed out its technology to independent manufacturers to make Apple-clones, in order to meet the rising market capacity and to make Mac computers ubiquitous, like IBM PCs.  However, these clones started to cannibalize Apple’s market share, and in a short time, they reached 20% of Macintosh’s unit sales. Spindler tried to make up for Apple’s losses by focusing more on international operations, and made international growth a priority.  But this was not enough to make up for Apple’s failing performance in the US market, and it reported a loss of $69 million in the first quarter of 1996.

Spindler was replaced by Amelio, who tried to revive Apple’s operations and concentrated effort towards streamlining the Apple product line and its distribution system. According to Amelio, Apple was to focus on the high-margin premium segment, which would allow it to justify charging a much higher price against IBM PCs.  But once again, this required a dramatic shift in strategy and re-direction of the company’s efforts.  He then decided to cancel the development of a new OS for Mac, which had cost more than $500 million in R&D.  His next step was to acquire NeXT Software, also founded by Steve Jobs, and had Steve Jobs return to Apple as a part-time adviser.  But NeXT had a very small market share, and its OS, NeXTStep, could not run Mac software.

Amelio re-organized Apple three times, and cut heavily into payrolls.  In spite of these actions, Apple lost $1.6 billion under Amelio’s leadership, and was replaced by Steve Jobs.

From the evaluation of Sculley, Spindler, and Amelio’s leadership, it is evident that their strategies led to further deterioration of Apple’s business.  The main reason was because all three employed vastly different, even opposite policies, which led to no progress for Apple.

4)      Evaluate the actions taken by Steve Jobs.  Do you think he has finally solved Apple’s problems in the PC business?

Steve Jobs took quick remedial measures to ensure Apple’s viability on the market.  Firstly, he brought saleable features into Apple computers, by obtaining a $150 million investment from Microsoft.  He put a stop to the cannibalization of Apple sales by its clones, by retracting the license and even buying out Power Computing, which manufactured these clones.   Next, he launched the iMac, a PC with distinctive design and inter-operability with non-Mac products.  He slashed new project plans by 70%, , reducing the directionless expenditure of company resources.

Jobs also outsourced iMac manufacturing to Taiwan, and revamped Apple’s distribution system.  A new Apple website was launched, and gained very good response for its online store, which accounted for 40% of the company’s sales by 2001.  He cut inventory to a minimum, stocking not more than two days’ worth of inventory in the warehouses.

One of the most important tasks for Jobs was to re-invent Apple’s image, which had taken a beating over the past decade.  A new concept and campaign for Apple was launched, promoting it as “hip, trendy, and different”.  Another revolutionary step was shifting from PowerPC chips to Intel chips.  This new microprocessor allowed iMac to run about 5 times faster, and use 20% less energy, without increasing its cost.  Apple also produced an Intel-compatible version of its operating system OS X.

Apple also made a major foray into retail, enabling it to reach a large number of customers who had little exposure to Apple products.  The retail stores were designed in a way to draw the buyer’s attention towards Apple’s different products, their ease of use with a variety of gadgets, and their unique, creative design.  By 2005, Apple’s retail stores had secured a year-over-year sales increase of 78%.

Steve Jobs’ plans and measures brought Apple tremendous success.  However, that does not mean the end of all problems for Apple in the PC market.  The primary reason for this is the rapidly changing nature of the PC industry.  The PC market in the US has reached the stage of maturity, and for the most part, is commoditized.  The profit margins are slim, and new demand is declining.  Recognizing this fact, IBM, the world leader in PC manufacturing, sold its PC business to Lenovo in 2000.  Keeping these facts in view, Apple’s introduction of the iMac with Intel, along with introducing a Mac with Windows OS, may be a risky venture.

5)      Explain why Apple has done so much better in the iPod business than it has in the personal computer business.

The original inventors of a portable music device offering connectivity and MP3 capabilities were actually Dell and Rio.  Apple was the first, however, to factor in three areas that were of most importance to consumers – battery life, form factor (design) and connectivity to a PC. Apple also carefully balanced these factors so that none of these came at the expense of another. The iPod isn’t the smallest device, it doesn’t have the largest capacity or best battery life, but it crosses the usability threshold on all three areas and doesn’t compromise on any of them.  By focusing on the three core attributes and actually improving on design, Apple created a product that had mass appeal, and was consequently extremely successful.  Added to this was the accessibility provided by Apple’s retail stores, and good customer service.

Apple’s iPod can be cited as one of the best examples of product differentiation in a commoditized market.

The iPod sales were also boosted by Apple’s online music store, iTunes.  The iTunes store, however, was nothing more than a loss-leader for Apple, generating almost no margin.  The sole purpose they served was to generate increased sales for the iPod.  The iPod, initially configured only for Mac, was later available to be compatible with Windows-based PCs.  In addition to Apple’s retail and online stores, iPod was also sold at general electronics stores, making it widely accessible.  And finally, the iPod was introduced just at the right time, when consumers wanted more and more digital integration and mobile devices.  Due to these reasons, Apple’s iPod business achieved much more success than its PC business.

6)      Do you think Apple can continue its remarkable performance in the iPod business?  What are iPod’s competitive advantages over rivals?  Are they sustainable in the future?  Please justify your answer.

As of 2006, the iPod sales show no signs of declining, and the trend is expected to continue for some time in the near future.  Apple is also planning on launching a number of products that would have interactive capabilities with the iPod.

But there are doubts regarding the continued success of the iPod.  One of the reasons is that unless Apple continues launching newer, more innovate and successful products in conjunction with the iPod, it might become a commodity.  The competitive advantage of the iPod is its interface and Apple’s patented design and technology.  Also, Apple has strong ties with music and other media companies for accessing music, pictures, etc.  However, Apple’s standard pricing of 99 cents per song is being disapproved of by some of the music companies.  Outsourcing the hardware manufacturing makes it possible for other companies to move in and launch newer designs with better capabilities.

One particular source of concern is cellular phones and other portable devices such as Blackberry.  Mobile handsets are offering increasingly advanced technology, seamless interface, creative design, and a wide variety of capabilities in addition to enabling calls.  It will increasingly become difficult for Apple to maintain the novelty and demand for iPods, and command a premium price.  For the time being, iPod is a cash cow for Apple, and will continue to be lucrative for some time.  Beyond that, Apple will need to have gained strength in another area or launched a new product to appeal to buyers.

7) Given Apple’s experiences in the PC business and in the digital music business, what strategy-related recommendations do you have for Steve Jobs?  What should he be doing, going forward?

At its current position, Apple has to make a few choices that will determine its path in the long run.  Given their success with iPod, one of the options is to center their business around the concept of the digital home, and become more of a service and software digital home application company.  This strategy would shape Apple into something like consumer electronics company, making hardware and software, rather than being a computer company. The Macintosh will still be the core business, around which they will be able to build other businesses for the future.  A problem with this strategy would be the questionability of sustaining the huge premiums they earn with iPod today.  Eventually, competitors like Dell will come in with much lower-priced products.  Another challenge is that Apple is still selling a proprietary solution, since music on the iPod cannot play on non-Apple devices.  This was the same problem they faced when the Mac computer was not compatible with non-Mac hardware and software.

A second option would be to continue manufacturing and selling iMac and iNotebok with Intel technology, and integrate other features such as the iPod and iTunes.  It could also license its OS for use with other multimedia and digital information providers such as cellular phones.  However, it is a fact that Apple has always been more of a hardware company rather than a software company.  Moving into operating system software and design licensing would require a major shift in the core business that Apple is in, and the switching costs of such a move may be prohibitive.

The third strategy, and perhaps the most viable, is to reinforce Apple’s historical competitive advantage in application and industrial design. Apple has three major advantages in this area: they have a very strong brand; they have excelled at industrial design, and they have been good at delivering applications in the digital home space.  Apple could eventually ease out of OS software development, and instead leverage their brand, industrial design skills, and application base. This strategy follows up on Apple’s recent move of delivering a Mac that operates on Windows.  Designing a consumer PC on Windows, with Mac’s unique design and interface and including the versatility of the iPod and iPhone, would tie the advantages that Apple has into a single saleable product, which could sell at a premium.  This move would also be the least disruptive, since Apple has established online and brick-and-mortar retail stores, and a strong manufacturing and supply chain system.