Role of Information Application in Business

Question: Discuss about the Role of Information Application in Business. Answer: Introduction: Information Technology (IT) is the application of computer systems (hardware, software, networking, telecommunications) (information technology, 2000) to store, manipulate and transfer data (Daintith, 2009) often in the context of enterprise operations (Bigelow, 2015). Effective deployment of IT is essential for sustaining competitive advantage in the marketplace (Shin, 2003). IT has accelerated the productivity and growth of businesses worldwide and combined with the Internet is enabling international commerce which otherwise would have been prohibitively expensive or just impossible. This paper is an analysis of the role of IT for the point-of-sale for McDonald's (Mcdonalds.com, n.d.) i.e. where the customer and the service provider interact. The paper will explore IT from the business's point of view as to the requirement, importance, methods of uses, pros and cons, and monitoring and maintenance of IT required in the storefront. Does the Business Need IT? The alternative of running a McDonald's point-of-sale without IT is possible but it would he highly inefficient and slow than with IT. In the present times, there are more than one points-of-sale like ordering over the counter, driving in a car via drive-through or mobile applications. Running a storefront without IT to handle customer orders would be slow as orders will have to manually calculated. It would be inefficient, as the alternative of using IT provides for saving time and any reasonable manager would want to save the time of customers and the employees. Without IT, the chances of fraud would be more as the current systems are connected to databases of the head offices, and a current tally of sales is available to head offices. Thus, without IT, the business is expected to be slow, inefficient and more prone to employee fraud. Also, without IT infrastructure, some types of point-of-sales are impossible e.g. mobile apps to browse, order, find nearby stores makes uses of sophisticated technology. Mobile apps are contributing a significant share of sales in the fast-food industry. Pizza Hut's only 54% of sales is through physical stores, with similar figures for Domino's Pizza and Papa John's (Taylor, 2016). Also, given that the competitors of McDonald's are committed to technology shying away from it would be a strategically missed opportunity as well as show negatively on the public image. Thus, the business requires IT for point-of-sale because the alternative of not using IT would deal a severe blow to the profitability and customer satisfaction. Why Is IT Important for the Business Survival? IT holds fundamental importance for the survival of the empire of McDonald's even when only the point-of-sale is concerned. McDonald's is among the biggest private employers of people, directly and indirectly. In the USA, it is the single largest purchaser of potatoes, apple and meat of pig and cattle (Schlosser, 2001). However, for what is all this big machinery running? It is running and is sustained by the customers who pay their money for the products of McDonald's. If IT is removed from the last and the most important link in this chain, then gradually the links attached to the chain will drop off. If customers stop buying from McDonald's for any reason, this loss will dry the empire, and the direct and indirect employment will taper off. From, the business point-of-view, anything and everything that can be done to sustain and increase sales must be done, and IT is an essential part of this growth. Not utilising IT in the point-of-sale whether real or virtual will end up making the enterprise less profitable and unpopular in the public eyes. Thus, IT is essential to the survival of the business and also to keep on providing employment to people associated with the firm. What Are the Requirements for Applying IT in the Business? Requirements for using IT in the point-of-sale in McDonald's are typical of any point-of-sale implementation. Also, the mobile app will have its prerequisites, as discussed later. The point-of-sale software system requires inventory system, catalogue system, credit/debit card system, printer, user roles (cashier, administrator) (Requirement engineering Exercise the POS System solution, 2014). Relevant hardware components will integrate with the chosen software is required. Because McDonald's is keen on using custom point-of-sale equipment in storefronts (Expert Market US, n.d.), thus generic off-the-shelf software are out of the question for the given scenario. Next, trainers and staff for handling the counter are required and so is a handful of managers for managing the equipment and employees. For the mobile app, two different apps are needed for the current most popular operating systems - Android and iOS (Miller, 2016). These two separate operating systems require different coding and maintenance of the app (e.g. separate developer fees for Google and Apple). The development of apps requires coding in the programming language used by the operating systems, designing, integration with the backend database of McDonald's using networking. Finally, the apps need to be published and maintained on the app stores (Google Play store for Android, and iTunes for iOS i.e. Apple devices). It must be noted that user expectations from the experience of apps are high and their criticism can be harsh and public (Loera, 2016). How Does the Business Use IT? The scenario being considered is the point-of-sale of McDonald's, whether physical storefront or the virtual storefront in the form of mobile apps. For this scenario, the role of IT includes enabling the cashier to take order from the customer, calculating the bill after tax and discounts, informing the kitchen of the order received, updating the inventory on the stocks just consumed. For the mobile app, the cashier's role is done by the customer himself, and the other activities remain the same. Thus, by these tasks, IT helps in an efficient and error-free operation that helps in customer satisfaction. What Advantages and Benefits Does IT Bring to the Business? As discussed in the paper, the alternative of not using the IT in the point-of-sale of McDonald's offline and online storefronts would result in a severe blow to the characteristics that make the business success. Needless to say, the entire juggernaut of McDonald's machinery is there for the single purpose of selling the food to the customer, and thus this is the most important component of the chain from the first transaction of buying the produce. Without IT, there will be a severe reduction from the current efficiency, easier fraud by employees, slower communication with the head offices and in general unhappy customers, especially in today's world when everyone is crunched for time. The advantages of IT in the last chain of the process are efficiency with the benefit of a faster checkout experience for the customer. Another benefit of a computerised system means that the accounts are tallied up-to-minute at multiple locations, and this makes committing fraud difficult. A benefit of mobile apps is that it allows customers to order conveniently without having to interact with a human. There is a reason why non-physical storefronts account for about half of the total sales (Taylor, 2016). This new avenue of sale brings the benefit of additional sales which may have been lost in the absence of IT. What Risks Does IT Bring to the Business? Whatever is important is worth stealing and going computerised does not change this fact, whether the threats are from outside or inside. The use of IT as considered in this paper open up new surfaces for risks. One risk is the single-point-of-failure in which an error in the software of the point-of-sale can bring the whole system to stall and prevent the further sale. Another risk is bugs in the mobile app e.g. an offer may display correctly, but the barcode required for may not generate. Data may be stolen while the data is in motion from the local branch to the head office especially if the data in unencrypted and uses an insecure channel like the public Internet. Hacking is a risk present, more with the mobile app. If a hacker can fool the system into believing that a payment has been made successfully or using stolen credit/debit cards, then the solution to the chargeback and the order already processed will be difficult to resolve. Another risk is the eavesdropping of data fro m the local WiFi connection at the McDonald's. IT systems require careful entry of supplies, and any incorrect entry can lead to piling up of orders which the McDonald's branch in question may be unable to complete. How Can the Business Monitor and Maintain IT? IT systems like any other software system require monitoring and maintenance. These systems must be tested in a production-like environment before being deployed to live machines. Staff must be encouraged to report any anomalies on the point-of-sale system for prompt correction by the development team. Also, the reviews of the apps in the app stores and mentions in social media (like Twitter, Facebook, etc.), support forums must be tracked to sense user discontent at the earliest and take actions to correct them. Besides this staff and user report, regular audits of the accounts prepared by the IT must be done. Maintenance of the software must be done by regularly updating the underlying operating system, the point-of-sale software. The hardware must be used correctly by the staff, daily cleaning must be done, and the ventilation around the device must be taken care of (Martin, 2016). References Bigelow, S. (2015). What is Information Technology (IT)? - Definition from WhatIs.com. [online] TechTarget. Available at: https://searchdatacenter.techtarget.com/definition/IT [Accessed 18 Jan. 2017]. Daintith, J. (2009). information technology. 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