IT For Business: Components Of POS System

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Question :

HC1041 IT for Business

Read the case study and answer the following questions:

1) What are the advantages and disadvantages of the new POS system? 

2) How will this POS system help the business gain competitive advantages?

 3) What are the advantages of having a centralised database?

 4) How could this POS system facilitate decision making?

Address the following points:

  Why do point-of-sale systems process business activities more effectively? 

 Can the information be tracked manually in an effective manner? Why or why not? 

 What types of questions could be answered effectively?

  How could the information be used to better manage the business?

5) Recommend telecommunication options for this POS system Address the following points: 

 Types of networks – LAN, WAN or MAN? 

 Types of media? --Wired or wireless technologies? Which types of cables should be used for wired technologies? Which types of wireless technologies?

6) What type of risks does the POS system bring and how to protect the business against the risks? Address the following points: 

 Security

  Privacy

  Confidentiality

Case study -- Blooming with Technology The use of information technology is needed by every industry size and type of business. Small businesses can realize the positive effects through adopting technology. However, small businesses often do not have the resources and expertise of large corporations to implement information technology strategies. However, the benefits of technology for small and medium-sized enterprises (SMEs) are just as crucial to business operations and strategy.

Consider Four Seasons Greenhouse and Nursery, located in Colorado. This small nursery was like many other small businesses and garden centers. They used manual registers to track and maintain its inventory as well as determine which products were realizing the most profit. The profits from the nursery were either "negligible" or a loss. They did not have access to useful operational data to effectively manage their business. For example, they did not track or review the margins of individual products. However, they believed that they needed to do something different for their $1M business operation.

Enter a new point-of-sale system (POS) in 2008. The system allowed the owners to track useful business data from the sales transactions immediately at the time of the sale; eliminating the need for tracking sales manually. The system processes and stores data from the sale while updating the inventory as well as compiling a sales history. This eliminates reliance on manual entry of sales transactions and reduction of inventory units for the items sold. POS systems provide much more than a cash register. These systems provide more robust functionality in inputting, tracking, and distributing data to provide useful information to operate and manage the business.

Accurate inventory data maintained by the POS helped with decision making. Decisions on how many units of a product to order were no longer based on speculation about current inventory units. Now, accurate inventory counts eliminate the guesswork on how much to order, helping the business to operate on leaner inventory units. The system's reporting can provide the detail transactions for an inventory item, such as how many were purchased, discarded, and sold.

The implementation of a POS system also confirmed that the owners did not know as much about their business as they thought they did. As they reviewed reports from the new system, they saw that some products were less profitable than they thought. The more detailed cost reporting by item helped them to understand which products contributed the most profit to the operation. Their new perspective of the "real costs" provided the opportunity to shift production to the higher-profit items, thereby gaining more profit. Prior to implementing the POS system, they simply did not have the time to approach this level of decision making.

Knowledge of their detailed product costs helps them to price products more profitably. Price changes can be implemented temporarily (for a promotion) or permanently and still remain within acceptable product margins. The accurate and timely reporting of this information assists them to be more effective managers of their business operations. The ability of the system to process sales, inventory, and purchasing transactions immediately reduces the need for data entry of paper information. The time savings can be used for managing the business rather than mundane clerical functions.

The new system has expanded Four Seasons' management control over employee schedules to review and allocate labour expenses to specific departments and functions. An additional benefit allows the owners to delegate more responsibility to the staff and establish accountability. Instead of the owners establishing goals, they provide the system's data and ask staff to submit their sales goals for the next reporting period. Ultimately, the information technology system creates a solid infrastructure to process and report the businesses operations for the entire enterprise.

The garden centre is an excellent example of how technology can realize benefits for a business. The ability for organizations to remain competitive and agile is crucial. These systems allow organizations large and small to leverage business data to gain a competitive advantage and operational efficiency.

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Answer :

Impact of IT on Business


The submission of POS arrangement has distorted the functioning of the functioning arrangement of the agency to a good sized point. The document envelops every of the components of the POS system that are utilized for selection building manner, its ready for action benefits and drawbacks (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015). The file covers the unique systems like LAN, WAN which can be utilized by POS. The dialogue approximately the powerful makes utilize of wireless expertise, varieties of danger concerned with the usefulness of POS device and guidelines to defend the gadget and give effectual privateness, safety and privacy is likewise mentioned within the record. To obtain the correct and précised records approximately the distinct characteristic of POS machine Google look for engines like Google and yahoo, articles, preceding academic study, magazine are referred.


To discover the applicable facts approximately the record diverse search engines like Google and yahoo were correctly used like Google seek (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015). The orientation from specific articles, research performed by intellectual, and surveys carry out by way of pupils, journals posted in publish medium or to be had online and different associated sources had been referred. In order to analysis this, there are some other sources has been used and examined such as different article’s published in the E- books and Journals so that it will be useful for examining the various facts which is based on the POS system in clouding their advantage and disadvantage in an effective manner.



Factor –of- sale (POS) gadget is effectively utilized by the owners to track treasured enterprise records from the enterprise exchanges instantly while the deal is started out. The gadget enabled the powerful implementation of records associated with processing of income and data renovation associated with sales and kept the document of the transactions inside the garage memory for destiny usage. The incorporation of the device enabled the effective in sourcing, monitoring and allocating of the transaction of the business enterprise in a greater effective way. The usage of POS gadget reduced the load of manually recording all the transactions (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015). The use of Pos helped in preserving appropriate inventory facts which aided in powerful selection making supporting the employer to reserve to exact range of portions which might be felling of scarcity. The POS helped in figuring out that the a number of the products which the owners of the employer to be profitable have been now not located to be profitable enough and the proprietors have been in an able function to take decisions concerning the innovation of the stock requirement as cautioned by means of the POS device. The POS gadget supplied the proprietors with a more distinctive document of the value and the expenses incurred with the aid of the organization because of which the proprietors have been able to rectify the trouble in a more powerful manner and increase the profitability of the corporation in a greater appropriate manner. The identification of the actual price paradigm helped the proprietors to take selections in the value regards of the goods additionally which became no longer concept of earlier. POS gadget furnished the proprietors with specific statistics associated with product charges due to which the proprietors were in an extra in a position function to take higher selection related to product pricing which helped them to increase their profits margin significantly (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015). The POS gadget offer information about the direction of sales, file, and purchasing dealings at once disposing of using manual paintings of records access. The time stored due to implementation of POS system becomes efficaciously used to administer the running operations of the business. 

Further, its miles located that the records cannot be tracked manually. As whilst the scale of the business enterprise grows, the size of the facts also receives accelerated which can't be managed effectively with manual monitoring down method (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015)? The manual racking down method is more time eating and the clients do now not have tons time to spare on these small jobs. The world is digitalized and the software of the old method of guide tracking down technique may want to cause gradual down the complete running system of the business enterprise so as to now not be beneficial for the agency. Hence it's miles essential to undertake POS machine and discard the manual monitoring device.


The application of POS device require using virtual medium which at instances come to be dangerous for use because the it is easy for the corporation information and statistics to get leaked if no longer operating systems are not secured with the help of robust passwords of anti hackers programs. The utility of POS calls for the set up of costly software via which effective software of the POS system may be feasible. The POS machine software require to be paid monthly expenses or annual subscriptions for the utilising the net server on which the POS gadget operates (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015). POS gadget can be efficiently when the company is net primarily based applications in case of software primarily based applications it will become tough for the POS machine to characteristic well. The incorporation of hardware that uses the POS machine into the laptop is a tough manner because it requires a terrific deal of precision and accuracy. The implementation of POS inside the hardware is a long and prolonged procedure concerning the producer of the gadget, the operator and the installer to characteristic together to implement the POS utility.


The applicability of POS has made the employer to understand about the patron’s interest and has successfully recorded the developments and the traits consumers on the way to assist the employer to know approximately the customers in a more efficient manner (Lee and Peleg, 2015). While the agency could be presenting higher carrier to consumers consistent with their tastes and preferences the client’s base of the organisation will increase so that it will assist the organisation to benefit competitive gain.

The blessings of having a centralized database

The implementation of the centralized statistics base will permit the conductions of the enterprise’s operations underneath one head integrating all of the works of the special structures into one. This could reduce the value of the corporation as much less funding may be carried out on hardware and machines. The device offers better safety provisions because it operated underneath one head. The system offers consistent processing interference that permits the conductions of the operational features of the organisation in a clean manner (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015). The machine affords the provision that the data and records this is used inside the operation process to be disintegrated whilst required and may act as impartial units of operations for you to make sure that the different operations of the agency characteristic in a proper manner.
POS device facilitate selection making

The powerful implementation of the POS machine into the operations of the 4 Seasons Greenhouse and Nursery has helped the owners manipulate their daily inventory troubles in an green manner, helped in the modern boom of the business through building advertising and marketing techniques and rendering trading insights which has helped the corporation to grow exponentially (Krush, Sohi and Saini, 2015). The POS system efficaciously provide the information about the stocks available in the store, offer data about the hobby and alternatives of the customers, the products that have been not greatest by the clients, helped in retaining al the accounting information in real time. These kinds of elements helped the owners to take right selections.


WANs are utilized to partner the relationship which might be regionally to be had (LANs) jointly so that the customers and computers are interconnected in a unmarried area in an effort to permit effective verbal exchange and correspondences can with customers and pcs in specific areas. The owners deploy the pcs to 1 particular base and a POS framework or a POS set up on the any other specific base to set up a connection among the 2 terminals. Both the connections are organized inside the LAN offerings that have been available locally (Islam, 2015). The WAN establishes a connection between the owner pc and the LAN network services with the aim to establish a powerful correspondence among them that's manageable via the net. Device conventions comprise TCP/IP conveyance shipping and efficaciously deal with the distinct operations of the agency. But no relevance of guy became discovered inside the implementation or operation of the POS systems (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015).


POS systems can be useful with each anxious as fine wireless expertise. The wireless POS machine allows the investors to provide on procession extraction and acclamation price canters right away while the business is finished. The advent of line within the POS structures is taken into deliberation to exceedingly giant as wire acts as the middling thru which the records are relocated from one utility to other. The POS machine can perform with some of cables which might be mainly related to the LAN offerings (Goleman, 2017). The form of line to be particular relies ahead the aspects like environmental position, situate of regulations and length of the running system. The exclusive styles of cable that can be worn are Unshielded Twisted Pair (UTP) Cable, Shielded Twisted Pair (STP) Cable, Coaxial Cable and Fibber Optic Cable. The usage of such cables will boom the effective functioning of POS structures. Wi-Fi technology that may be used by POS system to preserve the effective implementation of POS device is 802.11b or Wi-Fi era or Compaq iPAQ Pocket laptop which may be effectively used to connect the specific packages and boom the productiveness via connecting it to POS structures (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015).



Because the POS device works at the digital display place wherein utilize of internet is believably worn the safety intimidation of the POS software significantly boost (Armstrong, Kotler, Harker and Brennan, 2015). To shield the running POS system performance of stop to quit encryption element is optional a good way to guard the scheme shape the troubles of hacker and bugs.


The POS gadget makes use of a numeral of interferences at the digital display place which can cause solitude contravention and infringement. To guard the solitude restraints the POS arrangement need to be protected downstairs at the stop of the date whilst every the contact are finished to make certain that the isolation of the POS device is uphold (Ahmad, Zakuan, Ahmad and Takala, 2015). The personnel ought to no longer be allowed to carry with the various storeroom gadgets thru which they might stock up the information and drip elsewhere.


To guard the discretion of the POS machine the enterprise have got to take on specialists a good way to set up the essential safety method to limit the workers or other operational players of workforce to receive out statistics from the POS machine in an effortless way (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015).


The document correctly discussed about the exceptional attribute of the POS structures. It changed into concluded that POS system offers a bouquet of facilities to the owners who install the POS machine into their running device (Aharoni, 2015). But it is observed that POS gadget do posses some hazards however is now and again expression to be a hazard to the safety of the organization but the powerful performance of POS device surely give greater benefits than the difficulty and facilitates the company to produce increasingly (Terek, Nikolić, Vukonjanski, Gligorović and Janković, 2015).