Information System of Pricewater house Coopers

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Strategic Information Management

Information System of Pricewater house Coopers

List of contents

Introduction

1. Types of Enterprise systems

2. PwC profile

3. PwC Information management system

4. SAP Business applications

5. Problems and failures of ERP systems

6. PwC PEST Analysis

Conclusion

Reference list

Introduction

High-speed development of modern technology defines a constant modification business environment, forms and nature of competition between organizations, business models, methods and approaches to management, production technology, and the nature of relationships with suppliers and customers. A crucial role in these transformations are information technology, and the result of their evolution is the formation of an economy in which productivity and competitiveness of all actors depend on the ability to generate, manage and effectively use information based on knowledge. In such economy the main economic activities are organized on a global scale, and achieving a certain level of performance is possible only in a global interconnected network.

However, formation of the information economy and knowledge economy manifests itself in specific new organizational forms of business, the occurrence of which are both due to individual changes in the technologies work, and the use of innovative business models of organizations. The core transformation in any of the above cases is the information system of the organization. Thus, a clear trend of information is drawn most of the economic entities, which is manifested throughout the world, countries, regions and individual organizations. As the president of PricewaterhouseCoopers James J. Schiro said that "The current business model is undergoing fundamental shifts currently in full compliance with the basic tenet of Darwinism: The company either adapt to new conditions or perish". This provision applies to companies and enterprises of any form of ownership, size, types and activities (John W., 2000).

Every organization has an information system that can be characterized by varying degrees of impact on the core business and the level of automation of business processes. On the one hand, a successful operation of the information system to a large extent determines the development and success of the business in general which forces an organization to continually improve information systems and deal with problems for creating more effective systems to ensure balanced growth. On the other hand, due to the external impact on the organization its internal transformation gives rise to the need for constant change in the corresponding information system. Thus, the mutual influence of changes in the information system and the organization as a whole defines the iterative nature of the change management information system. This course work illustrates the evolution of information systems and shows, if it is properly implemented and managed, they can gain the competitive advantage of an organisation.

The paper begins, by use of case study (PricewaterhouseCoopers), the evolution of computer based Information System, and examines how the IS/IT strategies can help to enhance the competitive ability of PwC. It outlines the history and background of the company and the main strategic components that helped to build a successful business. It also describes types of enterprise systems in a whole, the Information System implemented in PwC and how it helps for the strategy, structure, decision making and many other aspects of the organisation.

1. Types of enterprise systems

In order to fulfil a customer order organisations need workers in manufacturing, sales, accounting, procurement and so on, to cooperate with each other and exchange necessary data. The information system which they require often is designed to meet one of these functions in particular. In fact, they were built on their own and cannot automatically share information. Production service might not to determine the number and types of products to prepare and there can be some errors, because their systems cannot exchange information easily between each other to process the order. The best solution is to use enterprise systems (ES), also known as enterprise resource planning (ERP) systems. The purpose of the ERP systems:

· The coordinated functioning of all system components, optimization of execution time and consumed resources. The system allows to use one integrated program instead of multiple disparate systems and supports processes within a company which can help for strategy, decision making, structure, and many other aspects of the company. The most popular ERP systems are: SAP/R3, BAAN, Oracle Applications, Renaissance CS (David Boddy, 2008).

According to the concepts of APICS association, 2011 (American Society of production control and inventory), the modern enterprise management systems ERP should include:

· Supply chain management

· Improved planning and coordination of schedules

· Sales force automation module

· Module configuration of the system

· Definitive resource planning

· Module of e-commerce

· Product data management

Figure 1: Anatomy of ERP Systems

2. PwC profile

PricewaterhouseCoopers was formed in 1998 through the merger of two major accounting firms Price Waterhouse and Coopers & Lybrand. The company is one of the "Big Four" accountancy companies which provide professional services in auditing, business consulting, taxation and law. PricewaterhouseCoopers defines its mission as promoting the growth of customers business. The company's headquarters is in London, United Kingdom. PricewaterhouseCoopers is present in more than 150 countries in Europe, North and South and Central America, the Caribbean, Asia, Australia, Middle East, Africa and the Pacific Islands, with more than 770 offices, which employs over 155 000 employees, and the number increased by 40 thousand during last decade (PwC, 2011).

3. PwC Information management system

As a result, PwC uses the advanced technical equipment and information system such as ERP to provide a professional service which includes Operations, Sales, Human Resources, Finance and Accounting and Procurement. A single system can manage a processing of logistics, distribution, inventory, delivery, invoicing and accounting. All documentation and reporting PwC is stored in two types of bases - paper and electronic. For the protection of electronic data supports a very powerful security system ATLAS™, installed on flash-cards for all staff that allows employees to access personal data periodically changing passwords. Also, lockers are installed on computers to protect from theft; in case of unauthorized access to electronic databases special designed software will destroy any information stored on the computer. With regard to innovation, the audit does not provide opportunities in this area, but in the consulting sphere the company is constantly looking for better ways to work (PwC, 2011).

4. SAP business applications

Known situation where a new quality of SAP business software changed not only the structure but also the profile of the company, unleashing growth, and creating significant business value helping to prosper. Moreover, working in close cooperation, PwC and SAP support regular customers to align SAP applications and tools with strategies and strategic business objectives.

Enterprise decision management (EDM) framework

· Plans to converge and organise processes and functions, knowledge management, data management and business intelligence

· Changes many of the data collection and tasks that are handled manually in specific business parts to its cross functional parts

· Increases business effectiveness at altering raw data into valuable material, distributing information throughout the company, and collecting data from those decisions to improve upcoming results.

· Builds strong connection between employees and departments. It gives an opportunity for employees to work together without errors which provide good information for decision making to achieve the overall strategic and tactical goals. Good information provides good decision. For example, incorrect data never can be lost; a person from financial department can see and realise mistakes of logistics one.

SAP customer effectiveness

In current economy the key business drivers are clients' loyalty and profitability. However, to drive operational efficiencies and customer satisfaction companies often lack accurate. It is essential to have an integrated set of sales, service and marketing processes that align organisation strategies and brand. PwC helps firms to control stronger analytics and effective customer relation management making better decisions to alter their business. PwC's SAP Customer effectiveness practice assists customers to focus on SAP customer relationship management, proof of ideas, improvements and huge client implementations. Also, CRM system of the company connects to its customers providing capability to manage their sales, marketing and other auditing services (PwC, 2011).

Moreover, PricewaterhouseCoopers works with vital information for its customers, which cannot be allowed leaking any information. Therefore, the company has developed a very powerful security system, eliminating the possibility of disclosure of confidential information. During the trainings employees are informed what kind of the information they may not disclose, then they sign a written agreement. At the entrance of the building stands a security and people are allowed to go inside only by swiping electronic cards or doing fingerprints. Copies of all documents on two carriers are stored in the offices of PwC during a year.

In addition, PricewaterhouseCoopers is also responsible for implementing ERP systems for other companies, allowing to automate accounting processes and controls. PwC helps to coordinate large, multipart, highly integrated applications and can assist a company:

· Decrease IT expenses of ownership helping to run new IT systems more cost efficiently to respond flexibly to the evolving needs of the company.

· Reduce a risk: professional and experienced consultants can help to establish fixed, expected IT costs over time.

· Improve performance by increasing productivity and encouraging effectiveness with clear and tailored reporting system.

5. Problems and failures of ERP systems

Implementation of any information system may result in failure, but in case of ERP class systems failures are too expensive, and the task to automate all business processes of the company is too complex. A normal company will not spend millions of dollars to install an information system without weighing consequences. Nevertheless, these kinds of mistakes occur fairly often. According to PwC, (2011), more than a quarter implementations of SAP R/3 are considered unsuccessful and there is no reason to believe that the case of other software vendors such class are how some other way.

A well-known history with the simultaneous introduction of Hershey Foods for several ERP-systems, when after the corporation spent more than $ 100 million on consultants, software and retrain their workers, it turned out that the installed system is still unable to perform the claimed function. Moreover, apart from money spent on the installation of the system, the company began losing money because of that mess with the software bugs and new packages have led to chaos in logistics (ICMR, 2011).

There are some companies having issues might come to court. For example, in 1999, the company W.L. Gore & Associates sued the consulting firm Deloitte & Touche, saying that the incompetence of experts led to the collapse of the last implementation of human resource management system which would cost $ 2.5 million dollars (Cnet News, 2011). Actually, reasons for failed implementations of ERP class systems may be several as follows:

· Implementation was carried out illiterate: the consultants did not have a clear implementation plan; they could not "break" the tradition existing in the enterprise.

· ERP class systems are very expensive and companies often underestimate implementation and training costs of the systems. Installation costs are not covered expenses and they could not pay off.

· Sudden change and lack of training. Implementation of new ERP systems are not viewed and managed as an organisational change process which can affect organisational strategy, structure, decision making, culture, people and many other aspects.

(Jatiender N., 2008)

The fact that successful implementation depends not only on the amount of money invested, and not from the famous consulting company. Success depends on the qualifications of implementers, on whether customers understand what they want to achieve and how customers and implementers understand each other. Also, the most important criterion is the ability and desire of the customer to adjust their business processes under the proposed software. Ironically, in many cases this is the easiest, cheapest and best way to implement simple - since much change modules that come by default, customers and implementers embark on an adventure that may not result in anything good and greatly complicate future updates to the system. A renovation is to get rid of bugs that are not insured by any software. Another reason for possible failure is a simple mismatch of scale. The company may have money for the installation of ERP system but it does not need and never be justified from an economic point of view.

Another thing is that this efficiency is not always obvious, and sometimes to determine the effectiveness of the implementation should be carried out additional audits. If we go back to material differences between the scale, it is clear that many companies simply do not need ERP or even harmful. This is particularly true of small and medium businesses, for which ERP systems are too expensive. Implementation of ERP systems must be preceded by some tough corporate culture, explicitly selected business processes because consultants need to know what it is they have to change, not trying to streamline the healthy chaos that reigns in some plants.

6. PwC PEST Analysis

Political factors

Legislative Consulting as such does not actually marked, making it difficult to control firms engaged in the industry. Naturally, the influence of such factors is extremely negative as it:

· reduces the quality of services

· opens up scope for various schemes and provokes the creation of one-day firms that undermine customer confidence to the whole field of consulting services in general, including the professionals

Economic factors

Over the last decade due to the stable economic growth, there was an increase of the audit and consulting services, distinguished by an impressive dynamics. This dynamic is only constrained by staff shortages caused by a lack of qualified specialists in marketing, management and finance. However, over the past couple of years, earnings growth of the largest market participants significantly decreased. For example, according to Google analytics, in 2008 the growth rate decreased to 23%. The reason for that was the global financial crisis that hit substantially to the sectors, in which demand already far outstripped supply. In part, it was compensated by the increased demand for consulting services that can help companies "go through" the crisis.

Social Factors

Consulting in general began more intensively to develop after the 90s, when the social prejudice against it changed and no longer accepted consulting business as a waste of time and money. Today, the brand of PricewaterhouseCoopers is quite strong and for the company entrenched image of a stable, skilled, well-reputed player. Despite the fact that consulting as a form of professional activity is known only in relatively narrow circles, the company is popular as an employer. According to "The Times" and "Career", in 2004-2005, PwC was recognized as the most attractive employer for young professionals in many countries. The company used actively and skilfully uses the methods of advertising like outdoor and banner ads, as well as advertising in print. PwC developed the program of social responsibility, which engaged in the sponsorship and support of education, culture and child protection (IZAGO, 2011).

Technological factors

It is impossible to imagine a modern organisation not enjoying the benefits of technological progress, especially such a large company as PricewaterhouseCoopers. Numerous offices would have been virtually cut off from each other and could not coordinate their activities and provide an acceptable rate of execution of orders, if would not be any opportunity to use the Internet and IT. Therefore PwC implemented the advanced technical equipment and information system such as ERP. Also, on the company servers installed the software, which can destroy all information in the event of unauthorized access. Office computers and flash-cards are protected by passwords which are changed at fixed intervals. Finally, lockers are installed on the computers to protect from theft, as we already mentioned above.

Conclusion

This study focused on developing theoretical principles of PwC, introducing methods and creation models that can solve the problem of auditing and development which is adequate to business information system. In fact, this is a task of PwC management process implementing innovation in the information system of the organization that will improve organizational effectiveness, return on investment in information technology and systems.

As a result, every organization has an information system, successful operation of which largely determines the development and success of its business, forcing the organization to continually improve information systems, deal with problems of creating more effective applications that brings smart growth. Due to external influences on the organization, its internal transformation generates the need for a constant change of information system, which makes decision-making process of modifying an existing system or the generation of a new iteration. The task of managing change in the information system of the organization is particularly complex and difficult in present circumstances, when in the market there is a huge number of proposals of solutions from different vendors.

These theoretical principles, methods and models form a new scientific discipline "information management", which has recently been actively developing as an academic and practical terms. The subject of information management disciplines is the management of information as a business resource management and the relationship between information technology, information system and business strategy. In this area of science is actively seeking its own methods and models that would be useful both in terms of the formation of a theoretical base and for solving practical problems.

strategic management audit information

Reference list

Books

1. John Wiley, foreword by James, J.Shiro, (2000), Meta Capitalism, The E-Business revolution and the design of 21^st Companies Markets, copyrighted by PricewaterhouseCooper. pp. 169-175

2. Paul Bocij, Andrew Greasley, Simon Nickie, (2008) Business Information Systems, fourth edition, pp.232-236

3. Kevin Grant, Ray Hackney, David Edgar, (2010), Strategic Information Systems Management, page 61

4. Robert D., Galliers and Dorothy E. Leinder, (2009), Strategic Information Management, Challenges and Strategies in Managing Information Systems, Fourth Edition, pp. 22-24, 184-369,440-443

5. David Boddy, Albert Boonstra, Graham Kennedy, (2008), Managing Information Systems, Strategy and Organisation, third edition, pp. 41-45.

6. Jatiender, N.D. Gupta, Sushil K. Sh., Mohammad A. R., (2009), Enterprise Systems, pp. 340-343

7. David, L.O., (2004). Management issues of Enterprise Resources Planning Systems

Internet links

1. PwC, PricewaterhouseCoopers Corporate homepage, (2011). [Online], [Accessed 06 August 2011], Available at: http://www.pwc.com/

2. PwC, (2011). History and milestones. [Online], [Accessed 06 August 2011]

Available at: http://www.pwc.com/us/en/about-us/pwc-corporate-history.jhtml

3. PwC, (2011). IT strategy and Organisation. [Online], [Accessed 06 August 2011], Available at: http://www.pwc.com/lu/en/it-consulting/it-strategy-organisation.jhtml

4. PwC, (2011). Information security. [Online], [Accessed 06 August 2011], Available at: http://www.pwc.com/us/en/increasing-it-effectiveness/information-security.jhtml

5. PwC, (2011). IT implementation. [Online], [Accessed 06 August 2011],

Available at: http://www.pwc.com/lu/en/it-consulting/it-implementation.jhtml

6. PwC, (2011). IT consulting. [Online], [Accessed 08 August 2011], Available at: http://www.pwc.com/lu/en/it-consulting/docs/pwc-publ-advice-into-action.pdf

7. PwC, (2011). Systems and process assurance (SAP),

[Online], [Accessed 08 August 2011], Available at: http://www.pwc.com/gx/en/systems-business-process-services/index.jhtml

8. PwC, (2011). Application managed services. [Online], [Accessed 08 August 2011], Available at: http://www.pwc.com/us/en/managed-services

9. IZAGO, (2011). [Online], [Accessed 10 August 2011],

Available at: http://izago.ru/3-pricewaterhousecoopers-pest-analiz/

10. ICMR, IBS Centre for Management Research, (2011). ERP implementation failure at Hershey Foods Corporation (Case study, 2008), [Online], [Accessed 07 August 2011], Available at: http://www.icmrindia.org/casestudies/catalogue/IT%20and%20Systems/ITSY059.htm

11. APICS, the Association for Operations Management, (2011). Introduction to Enterprise Resources Planning (ERP), [Online], [Accessed 07 August 2011], Available at: http://www.apics.org/Education/Courseware/ERP

12. Cnet News, (2011), Business software firms sued over implementation

[Online], [Accessed 10 August 2011], Available at: http://news.cnet.com/Business-software-firms-sued-over-implementation/2100-1001_3-232404.html

Bibliography

1. John Wiley, foreword by James, J.Shiro, (2000), Meta Capitalism, The E-Business revolution and the design of 21^st Companies Markets, copyrighted by PricewaterhouseCoopers.

2. Paul Bocij, Andrew Greasley, Simon Nickie, (2008) Business Information Systems, fourth edition.

3. Kevin Grant, Ray Hackney, David Edgar, (2010), Strategic Information Systems Management.

4. Robert D., Galliers and Dorothy E. Leinder, (2009), Strategic Information Management, Challenges and Strategies in Managing Information Systems, Fourth Edition

5. David Boddy, Albert Boonstra, Graham Kennedy, (2008), Managing Information Systems, Strategy and Organisation, third edition, pp. 41-45.

6. Jatiender, N.D. Gupta, Sushil K. Sh., Mohammad A. R., (2009), Enterprise Systems.

7. David, L.O., (2004). Management issues of Enterprise Resources Planning Systems

8. Dave Chaffey, Gareth White, (2011), Business Information Management, second edition.

9. Stephen Haag, Maeve Cummings, (2010), Management Information systems.

10. Graham Curtis & David Cobham, (2008), Business Information Systems, Analysis, Design and Practice, 6^th edition.

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