The Commonwealth Bank of Australia and its Services

Discuss about the Organizational Structure Of Australian Commonwealth Bank.

In this literature review, the Australian Commonwealth Bank organizational structure will be discussed and will be understood the operational problems, which are arising from its structure (Willcocks 2013). Some of the common problem like inefficiencies, errors will be identified in the structure of the organization. The literature will contain the related information and graph based on the structure of the organization. Further, a sales procedure flowchart will be provided of the Commonwealth Bank to understand the system. There are marketing leaders who have competitors in the market related to the particular bank which will be discussed with the market size of the bank. All the points that are mention will be discussed in the following sections one by one (Gholami et al. 2013). There will be two parts, the first part contains the structure of the organization, acquisition methods, frauds and problem related to the system. The second part will be developing and adopting the package of accounting software and encounter the challenges faced and provide with recommendations and suggestions.

The Commonwealth Bank of Australia has several branches in New Zealand, United State, United Kingdom, Asia, and Fiji. The bank services have diverse in various financial part namely loan and investment services, educational banking, retail banking, funds management, and organizational banking (Commbank.com.au. 2018). According to the Australian Securities Exchange (ASE) the Commonwealth Bank of Australia is found to be the best and among the top 4 banks of Australia. This bank was basically found by the Australian government in the year 1911.

Demonstrating the clear image of the organizational structure of CBA, which consists of all the management levels and significant employees. The respective board of commissioners is the top management level and they are responsible for taking each and every vital decision in the organization (Haux et al. 2013). They are responsible for providing instructions to the middle and lower level of management. The middle level management works according to the instructions of the top level management and they provide instructions to the lower level management. The organizational strategies are made by the middle level management and they are executed by the lower level management.

The operational problems of the organization have become a major issue for the degrading the shares of the market and thus this particular issue are required to be mitigated as soon as possible (Al-Hiyari, AL-Mashre and Mat 2013). The first and the most important issue within the business operations of Commonwealth Bank of Australia is that the rate of interest is extremely high in respect to all other banks in Australia and New Zealand. Due to high rate of interest, the customers are not willing to invest within their organization. The second important issues within the business operations of CBA are that the presence of conflicts within the employees. The three levels of management are not interacting amongst each other properly and thus conflicts are arising substantially (Bryson 2017). The erroneous approach towards their problems is another vital problem in this bank. The next problem is the constant competition with FinTech companies. The downfall in share prices has thus become a major issue for them.

Organizational Structure of CBA

Demonstrates the clear image of downfall of shares in the commonwealth Bank of Australia. In the month of March, the share prices were 91 dollars and in December, it has gone down to 75 dollars, which is extremely lower than usual.

There are four important strategies of this particular bank. They are given below:

1. Technology: The technology of this organization is updated and they make sure that the technology they are using is perfect.
2. Customer: The second strategy is customer. They keep this particular strategy as the first priority and always try to satisfy their customers (Amrollahi, Ghapanchi and Talaei-Khoei 2013). They think that if the customers would be satisfied, they would again come back to the bank and the new customers also would work with them.
3. Strength: This is the third strategy of Commonwealth Bank of Australia. Every bank goes through financial crisis and they make sure that this type of crisis is mitigated properly without any problem (Galliers and Leidner 2014). The strength of this organization is the best strategy that they always change according to time. The balance sheet of this organization is maintained and the flexibility of this balance sheet is eventually maintained by them.
4. Productivity: The fourth strategy of Commonwealth Bank of Australia is the productivity. They focus on their productivity and keep a track of their regular productivity so that no problems occur within the system.

The system acquisition method of the organization of Commonwealth Bank of Australia is the Enterprise Resource Planning or ERP. The system acquisition method helps to develop the applications of any organization properly and significantly. This mainly occurs as any particular business comprises of various applications or processes (Dandago and Rufai 2014). ERP or enterprise resource planning are utilized by the organization to integrate all the business process of the bank. The major processes of this organization are for the betterment of the business and thus these processes are required to be integrated as soon as possible. They utilize SAP for this purpose. It is extremely costs effective and efficient and they get various benefits from this method.

Sales of Commonwealth Bank of Australia. The three components of this flowchart are evaluation, review and respond. The first step is the review, where the customer reviews the system (Palvia and Palvia 2013). Next, the bank agent responds to the customer request and finally the request is being evaluated in the final step.

The several problems within the bank system are extremely dangerous for the bank operations. The shares have gone down and they are not being able to maintain their standards with the other banks (Arvidsson, Holmström and Lyytinen 2014). The second major problem is the high rate of interest that is stopping the existing and the new customers to keep their trust on the bank.

The frauds for this particular bank could be fake emails and fake SMSs. These types of frauds should be avoided by them as soon as possible so that they exists no problem within their banking system.

Accounting software is mostly use by accounting professional for managing the accounts and performs various kinds of accounting operations (Xero Accounting Software. 2018). Accounting software allows the company to track financial transaction and operate different accounting department related transaction such as accounting records, trial balance, payroll and account payable for instance report and analysis. It helps communicating and recording financial related information for internal and external audits. With the use of accounting software, the accounting cost is reduced and makes accurate and timely report to make a proper financial decision (Hill, Jones and Schilling 2014). This software is acquired from a third party vendor or otherwise diverse to various companies who plan to take any one accounting software. This software is a cloud based or desktop based or combination of both cloud and desktop based system which can be operated from anywhere. Depending on the budget and problems face by the company, it should be decided which product to use.

Operational Problems of the Organization

Accounting software is adopted by a number of business organizations as it offers a number of benefits. It automates the financial transaction processes that help in proper tracking of the financial records of the company (Xero Accounting Software. 2018). The use of the accounting software is prevalent in Common Wealth Bank as well that automates the financial transaction processes. The use of the accounting software has considerably helped the organization in gaining a competitive advantage in the market (Ogiela 2015). Commonwealth Bank of Australia makes use of XERO software in order to manage their financial accounting transactions.

Australian Commonwealth Bank, it has observed that the market shares have slight degradation in the past few years. The share that was seen in FY11 was of 2.12, in FY12 it was 2.09, in FY13 it was 2.13, in FY14 it was 2.14, in FY15 it was 2.09, in FY16 it was 2.14, in FY17e it was2.11 and now in FY18e it has seen the share has reached to 2.19 (Konsynski and Karimi 2013).

As research done on the marketing strategy for the Commonwealth Bank, it has seen that there are numerous competitors who were competing with the bank. Some of them are as follow:

1. Bank west
2. George Bank of Australia
3. Westpac New Zealand
4. NAB Australia
5. ASB Bank
6. Kiwi Bank New Zealand
7. ANZ Australia

Commonwealth Bank particularly has seven bank main and core competitors. As shown in the chart above, the Commonwealth Bank gains total clients and shares of more than 50 %. ANZ Australia gains 13 % and NAB Australia gains 16 %. All the remaining clients and shares are gained by the rest of the banks (Simkin, Norman and Rose 2014). From the pie chart it can be clearly analyze that the Commonwealth Bank is gaining the highest competitive advantages as compare to the rest of the rest the banks. Thus, it indicates that Commonwealth Bank is the market leader among all the other banks. Furthermore, there is a good amount of growth for the business man. The benefits are lucrative for new entrants who make investment in the banking industry.

Although the use of accounting software has increased over the years, there are certain challenges associated with the use of accounting software (Alexander 2013). The current gaps and challenges that is encountered by the users and the customers of the accounting software packages are as follows-

One of the major issues with the use of accounting software is that it makes use of cloud storage to store the financial and accounting details of the organization. This can be extremely insecure in terms of maintaining the privacy and the confidentiality of the data stored within the system.

Organizational Strategies of CBA

Another major challenge associate with the use of accounting software packages is that the installation process is quite lengthy and proper training is required in order to understand the process of installation and timely updates (Simkin, Norman and Rose 2014). The operation of the accounting software packages therefore requires the employees to be properly trained.

Another major challenge that the users of the accounting software packages face is that it cannot be easily customized. This is mainly because of the system restrictions that users cannot perform customization based on their preferences.

These are the major challenges faced by the users and customers of accounting software packages. Certain recommendations are made in order to mitigate these challenges.

The business of Commonwealth Bank faces various issues of which the major issue is the highest interest rates. The stakeholders are supposed to focus on these issues and reduce the interest rates and let the clients to take the loans from the bank. The second concern is regarding the use of accounting software where the bank needs to decide to use the appropriate accounting software package to maintain the data of the banks system to make it work faster and easier.

The recommendations made for the better implementation of accounting software in the Commonwealth Bank are as follow:

Anti-virus software: The most common risk of cybercrimes that has been seen for past few years is the major concern of every firm. Thus, it is advisable to purchase an anti-virus software for the banking industry and install them on the computer to reduce such risk to secure the entire accounting software as it is a cloud based software. The banking process has lot of confidential information so the risk of losing the confidential information would reduce.

Providing Training to staff: The staff member of the banks is advised to have a prior training session to equip the technical skills so that the members can use the cloud accounting software in their system. It is important that the staff knows about how to feed the data into the system with the use of the software components.

Conclusion

With the above discussion, it has concluded that even though the Commonwealth Bank is leading among the four top banks in Australia, there has been various turmoil faced by the bank. The result of such turmoil has reduce the popularity of the bank. The literature review had cover the basic problem regarding the organizational structure, errors, inefficiencies and sales procedure of the bank. However, with the use of cloud accounting software the Commonwealth Bank increases rapidly in comparison with the other banks in Australia. Moreover, the software provides some leading features for transaction, payroll integration, invoicing, inventory management, drafting and lot more. However, it has been suggested for the arrangement of some training session for the banking staff member regarding the implementation of accounting software and use of anti-virus software for implementation of cloud accounting software.

References

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