Financial management process
One of the business processes that is common to all industries to include the electronics industry is that of financial management. An example of a firm that is common in this stated industry is the Apple Company Inclusive. This entity is regarded as the most innovative and the most profitable in the market. Despite this case, Apple Company Inclusive still does not have a proper system in place for financial management. Given that the firm is a global corporation, it makes sales from its outlets across the world. However, there is a problem with the synchronization of its systems in that the individual outlets have to separately send their returns. This makes it time-consuming to get an overall outlook of the financial performance of the company for financial analysts. In order to curb this problem, there is a need to introduce new technology and this is the integrated financial management system.
Consequently, there are various advantages that can be associated with the integrated financial management system. One of these advantages is that it enhances comprehensive reporting. An integrated financial management system is capable of providing accurate and timely reports to the management (Boateng, 2020). This claim is based on the fact that the component operates on a real-time basis. The generated real-time reports from the integrated financial management system can help in making top-notch decisions with the aim of providing direction to the organization.
Apart from that, the other advantage of the integrated financial management system is that it is suitable for an audit trail. When working in ideal conditions, the system is suitable for the facilitation of the audit process. This is because the auditors can be able to get an overall overview of the whole reporting system, and can, at the same time, be able to track individual transactions. With the capability of tracing single transactions in a business, it is possible for the auditors to effectively carry out the audit (Stern, Stewart III, & Chew Jr, 2006).
Last but not least, the other notable advantage of the integrated financial management system which is desirable for any organization is in regard to the preparation and execution of budgets. The ideal system is capable of helping the responsible authorities to come up with a plan of action that will be used in the appropriation of the finances within the enterprise (Boudreau, & Ramstad, 2007). This claim is based on the premise that the organization will have all its revenues highlighted in a single system. Therefore, allocating these revenues in various areas becomes easier.
Lastly, the other advantage of the system is that it allows for ease of integration. With an integrated financial management system in place, as the name suggests, it becomes easier to integrate. In this case, the business functions can easily be controlled using a single system. This makes it quite easier to process the transactions as well as convey financial information. When there is integration, redundant activities will be eliminated, with the result being a more robust bottom line.
On the other hand, there are various disadvantages that are associated with an integrated financial management system. One of the disadvantages is that the input data may be too voluminous, and this may make analysis difficult (Boateng, 2020). Given that the system will be fed by data from numerous outlets operating under the firm, the quantity of data will be large. This may lead to delayed analysis, especially if the system is not up to date.
The other disadvantage of the system is that of cost. It is very costly to introduce a new financial system in an organization that will be capable of having a single database. The rationale behind this claim is based on the fact that it will be resource consuming as some new input components and software have to be put in place. All these resources will have a huge toll on the finances of the company. Apart from that, the staff members may also need some form of training and this will consume the organizational resources as well.
Conversely, there are various factors that may affect the deployment or rather the implementation of the integrated financial management system at Apple Company. One of these factors is management support. A lack of support from the management will make it difficult or even impossible to deploy the system (Dener, Watkins, & Dorotinsky, 2011). This claim is based on the fact that the management are the one who allocates resources that may be required in the implementation of the system. Therefore, without there support, it will be difficult to implement the infrastructure. For this reason, the business should ensure that it gets the management convinced for them to support the venture.
The other important factor that may affect the implementation of the integrated financial management system is the skill set. The organization should ensure that the employees within the organization have the requisite capacity to operate the system. In this case, such persons may be required to gain skills in data input and analysis, as these are the main ones that are required to ensure that the system is fully functional.
References
Boateng, R. (2020). Handbook of research on managing information systems in
developing economies.
Boudreau, J. W., & Ramstad, P. M. (2007). Beyond HR: The New Science of Human
Capital. Boston: Harvard Business Review Press.
Dener, C., Watkins, J. A., & Dorotinsky, W. L. (2011). Financial Management
Information Systems: 25 Years of World Bank Experience on What Works and What Doesn’t. Washington, D.C: The World Bank.
Stern, J. M., Stewart III, G. B., & Chew Jr, D. H. (2006). Eva®*: An integrated
financial management system. European Financial Management, 2(2), 223-245.