Discussion Points

Discussion

Identification of weakness in Platinum Manufacturing Group:

       There are several weakness in the expenditure process of Platinum Manufacturing System. The weakness has been identified  for the individual process:

    Purchasing:   The verification process of the purchasing g form is acceptable for the security purpose. However, it has been found that the process is manual (Kane et al.,2015). This takes much time in the verification process. The choosing of the suppliers is done on basis of different factors. However, the placement of order is done verbally which is not acceptable. The verbal communication between the company and the suppliers can generate human error in the order placing; moreover, there will be no proof of the number items and the types of items ordered by the company (Armada & Martin, 2016). The documents including purchase number are sent to the department and purchase order file is opened. The whole process is done manually which can be replaced by the automatic machine process (Mack & Veil, 2017).  Again, the acknowledgement of the receiving of the order is informed to the department verbally, which is not a professional way of communication. This acknowledgement can be done by a certain process which can be used as valid proof.

   Receiving: The receiving of the order includes the stamping of the purchase order along with checking the order details. Any difference between the requested order details and the received order is taken into concern (De Haes et al., 2017). The receiving clerk sends the purchased order along with the equipment to the requisitioning department followed by a verbal acknowledgement to the department. This verbal communication can be replaced by the communication through official way.

    Accounts payable: After receiving the order the clerk in the accounts department fills the open purchase order. This is an manual process and chances of human error is present in the process (Utesheva, Simpson & Cecez-Kecmanovic,2016). Moreover it takes time in filling each of the file. The filling of the invoice purchase order along with the purchase number is filled with paid invoice, which is also a manual process that is time consuming.

   Treasurer: The cheques are sorted into two types- cheques for under $10,000 which are machine signed. The cheques which are above $10,000 are signed by both cashier and treasure. This approach is useful for the security purpose and there is no weakness noted in this section.

Impact of weaknesses on the organization:

         Certain impacts of the flaws or the weakness in the system can be observed in the organization:

At certain level in the organization, the communication is verbal. The verbal communication can create miscommunication during the understanding of the requirement and acknowledging the information. This can lead to serious problems in the process. In case, if the placing of the order is not done properly , there will be a difference between the placed order and required order.

The filling of the purchased order is done manually. In this case, the human error such as filling up with wrong order number can happen. This can lead to the mismanagement of the process flow in the organization.

The storing of the important files and data are stored in the office. In this case, misplacement of file can happen.

The payment is made in offline mode, which is cash on delivery system. The cash may not be available all time. In that case online money transaction can solve the problem.

Practical implementation to mitigate the internal risks:

There are certain steps; those can be taken in order to mitigate the identified internal risks of the Platinum Manufacturing company. The three identified weakness, which can cause the risk in the organization are- the verbal communication in the business process, the manual filling of the forms and bills and the storage of files at the office.

Storing the important files containing the important data can be misplaced (Norta, Grefen & Narendra,2014). This can create problem in future for the company (Gureva et al.,2016). In order to eliminate this, concept of cloud storage can be adopted in storing process of the data. This will help to retrieve data from anywhere and anytime (Horlacher, Klarner & Hess,2016). The security will be provided by the cloud provider. There is no need for the company to maintain the record manually which will be cost effective. Moreover, the cloud storage will provider larger space to store data.

In order to replace the verbal communication, certain initiatives can be taken. One of these initiatives is to develop an electronic interface, through where the communication can be created through internet or LAN. The communication through this electronic interface will help to keep the track of the summery of the communication, which may be needed in the future along with that it will allow the faster communication. In order to do this a software interface is needed to be made through which the staffs of different department in the organization can communicate (Hyvönen, 2018). In order to communicate with the suppliers the transcript of the requirement needed to be generated and the transcript can be sent to the supplier for the confirmation or the electronic forms can be used (Majchrzak, Markus & Wareham, 2016).

In order to fill up the order details, instead of manual effort the barcode system can be implemented. All the information regarding quality and quantity of the placed order can be encrypted into the barcode (Zimon, 2016). The retrieval of the information can be done scanning the barcode. This will eliminate the chances of human errors and will save time and money of the processing.

Recommendations for the reengineering of the expenditure process:

Certain recommendations can be made to implement the whole process in such a way that maximum use of IT technology can be made in the system.

Certain IT technologies can be implemented such as barcode scanning, electronic fund transfer and interchange of data electronically. In order to implement these systems in the organization certain requirements should be followed:

The overall infrastructure of the organization is needed to be improvised.

The new electronic interface is needed to be implemented so that the communication can be done through electronic data exchange and electronic forms. In order to develop this system a group of software experts can be recruited.

The infrastructure for the bar code scanning is needed to be done.

The cloud architecture is needed to be implemented. In order to do this the selection of clod provider is important.

The transfer of the money can be done electronically (Conforti et al.,2015). To do this certain arrangements with the financial institutions can be followed.

The security in the system should be maintained properly. The password of the systems should be protected and the authorization for accessing the system should be restricted to certain officials of the organization.

The security at the transaction gateway is needed to be checked by then officials.

The workers of the organizations are needed to be trained, so that they can be familiar enough to handle the new IT dependent system.

The backup and recovery strategy should be taken by the company in case if te system crashes.