National Australia Bank's Essay On Organizational Structure And Accounting Systems.

Literature Review

The National Australian Bank (NAB) was formed after the merging of two banking companies in the year 1982. It is currently one of the top most rated companies dealing with financial issues and market capitalization in Australia. It is an international company with a large number of customers and employees working in it. NAB has been rated as world’s 21^st and 41^st largest bank in relation to market capitalization and total assets owned. The company has various branches in different countries and towns of Australia. Apart from its headquarters in Melbourne, the company operates in Australia, New Zealand and Asia (National Australia Bank Ltd (NAB.ASX) Company Profile, 2015). However, it has grown at a very high rate and established branches also in London, United Kingdom, Hong Kong, Singapore, Japan and the U.S. The main aspect that has contributed to its expansion is the increased acquisition opportunities. The company was established through merging of two smaller banks but has recently been acquiring smaller companies and business entities. In addition to that, the company has contributed a great deal to the Australian economy by creating employment opportunities and offering banking services as well as investment opportunities to the Australian citizens (About Us – NAB, 2015). In that case, it is obvious that one of the aspects that has helped NAB stay in business for that long is because of the use of the modernized and improved accounting systems available in the world today. Apparently, they help it manage and control most of its business operations all around the world. It is certainly of the businesses that are using systems and that makes it viable to be used as an example in this assignment. 

A business’s organizational structure refers to the organizational rules and regulations, policies and principles that are responsible for coordinating and managing the business operations and activities. NAB being an international bank, then it means it is a very large business and operates with a large number of different businesses and services. The business is able to wrap up all these responsibilities in the various towns and countries by using the accounting systems to manage all of them and ensure they are effective and efficient. Its organizational structure is directly related with the management team and the employees with an aim of achieving certain set specific goal and objectives with the help of the accounting systems. In July 2016, the bank announced its organizational structure changes and the leadership changes as well. The bank has accelerated the transformation for the bank by engaging the four year investment in technology for the sake of organizational operations (About Us – NAB, 2015). The objective of the business when it decided to invest in the technology was to reduce duplication of activities and operations which now they will be able to achieve. Also, the decision making structure of the organization was established to be able improve its productivity, improve the strength of its franchising services and improving its reputation.

When it comes to the management team the bank came up with a new strategy to ensure that its executive team is performing its responsibilities in a better and improved way and certainly it is through the use of the accounting information systems and other internal systems. For instance there would be promotions and manger swapping but according to the experience, expertise and skills of the manager. In addition to that, the successful demerger and IPO of Clydesdale and Yorkshire Banks operations are another way to restructure the banks business activities. Through this structure, the bank is able to achieve its goal and objective of creating a simpler and improved customer focus bank services that will always produce the best results for both the customers, shareholders as well as the employees. The accounting systems have played a very important role in these kind of operations either by helping in the planning, scheduling, organizing or controlling the activities.

Current Organizational Structure For NAB

NAB’s organizational is said to be complex. Even with the fact that it is effective and efficient, it is sometimes challenging especially for the employees (Khanam et al, 2016). The structure does not give employees an opportunity to interact and if they do, it is simply not efficient interaction for them. Additionally, it may not give a chance for employees to relate with the management team. This therefore will likely increase their changes of increasing their commitment towards the company’s objectives and goals. However, it is certainly the work of the accounting systems to help the employees and the management to work together by creating a better communication channel but if the business lacks these systems then the challenge increases.

Such a complex structure is most likely going to reduce the decision making pace because of the many departmental considerations to be made. The bank has been changing its structure after a short while and because of this, the changes in innovation and invention processes involved need decision making which is inevitably a long process. This process can cause delays to the business operations and therefore affect the bank’s success level as well (Turner, 2016). If the business would have installed and implemented the use of accounting systems, this process would certainly be much easier and faster.

Frequent change of any organizational structure involves financial usage. In addition to that, it involves time wastage. The decision making process is time consuming, the structure restructuring process, the time taken by the employees to adapt to the new structure to name a few issues that take time. Therefore, this is a problem that can affect NAB’s operations indirectly as well as directly. However, with the use accounting systems, the business will be able to manage the business funds effectively and efficiently which would reduce the chance of such a problem arising.

The best system method for NAB business is the ERP system software. This is a system that any business can use for its information technology operations or aspects related to technology activities as well as human resources management (Bajdor et al, 2014). Being a company that deals with banking services and financial markets for customers, it has a great deal of issues that relate to accounting and information system (Boehm et al, 2013). Currently, the business has been considering a plan to cement its relationship with the US software giant Oracle. Also, the business has already made the decision of working with SAP, Siebel which is a software company located in Germany. This shows how the bank is willing to invest in information technology and especially the accounting information systems with an aim of improving its operations and especially services to customers. The above named software companies are capable of installing the ERP system which will help the bank in running its operations and later achieving its objectives.  

In a sale process, the seller must have as much information about the product or service as possible. This will be able to help them convince the buyer to purchase the product or service. This means that they must know the positive and negative features of the product and also be aware of the competitor’s products and the available substitutes and their characteristics. This kind of information gives the seller confidence to sell the product. With this knowledge, they will be able to sell the product and achieve the main objective and goal of the sale process which is to make profit.

Operational Problems Resulting From the Structure

Every business process involves planning for the operations that are supposed to take place. However, the planning process can take a lot of time to be implemented. Additionally, an effective and efficient planning can be difficult to manage. If a business conducts a plan that may not be as effective and efficient as possible, the sale process may not succeed and therefore cannot achieve the set objectives and goals. In that case, the use of accounting could have helped if they were available. This is simply because these systems’ purpose is to help in planning and scheduling of any business operations and ensuring that they are successful.

In a sale process, there must be frequent checkups to find out whether the process is functional or if it is working towards the business’s objective and goal. By doing this, one will be able to correct the mistakes that may have been made or correcting the whole process if it is not in line with the business goals which is to make sales and profit (Rothaermel, 2015). Therefore, if no follow ups done for a sale flow chart, the process is likely going to fail hence overall business failure. This could have been caused by lack of effective accounting systems which would have helped assess the whole sale procedure easily and faster and correct the mistake earlier.

Effective communication is one of the key factors that every business should have. This includes manager-employee interaction and employee-customer interaction. A business that does not have effective communications will be increasing its chances of failure and especially in a sale process flowchart. The manager must be able to communicate well the sale process, the sale targets, profit level targets, rules to be followed to name a few things (Laudon et al, 2008). This can be done by the accounting systems very efficiently hence successful sale process. If this becomes a challenge to a business, then the probability of achieving the sale process objective decreases and therefore leading to business failure. 

NAB has been growing and developing its business operations through the use of the modern and updated accounting software and packages. The business has been investing in improving its online accounting services especially that that it offers internationally. The accounting software development and adoption has been a growing process for the business and has currently improved its overall operations through that (Benbasat et al, 2007). NAB uses these software and packages to manage its employees, finances, investment options and its trade as well. In addition to that it also manages its customers’ bank accounts as well as analyze its market share and its overall performance in the industry by doing a comparison with its competitors. Though the accounting software it is able to manage its other branches in the world and be aware of their performances. Therefore, the business has currently great use of its accounting software hence being able to achieve its objective of improving its service quality to its customers.

The bank is an international business which means it offers services all over the world apart from in its domestic country. NAB operates in different regions like Asia, Australia, New Zealand, Japan, Hong Kong, US, London, Tokyo to name just but a few. Also, it has a range of various business services to offer to its customers like: business banking, personal banking, UBanking, MLC & Private wealth banking, whole sale banking, specialized group asset services, corporate services and financial marketing services among other services which are certainly successful with the help of the accounting systems. The company has also employed a very large number of employees to take care of tits more than 12 million customers (About Us – NAB, 2015). In addition to that, the bank has a good number of branches all over the world that help it fulfill its customers’ needs. These are all controlled and managed with the help of the accounting systems that are implemented in the bank. This is a clear indication that the business has a very wide range of market share and segment across the world. It has achieved this through the use of business and enterprise acquisitions which has helped it expand its operations all over the world.

NAB’s System Acquisition Method

Some of the competitors of NAB include the following: Common Wealth Bank (CBA), Australian Security Exchanges, Australian and New Zealand Banking Group (ANZ), Westpac (WBC) to name just but a few companies and banks. This are some of the closest businesses that compete with NAB. This is because they are all registered under the financial industry of Australia and that they offer the same services to the Australian citizens. The businesses are also international businesses which means that they have almost the same market share with NAB. However, they also have a competitive advantage over NAB business which includes: higher revenue generation therefore giving them an opportunity to be rated higher and their names themselves which carry a very high rated identity feature of the businesses. Through this aspects, the competitors are able to be rated higher on different levels by comparing each aspect with NAB. 

As for the customers, they may lack the knowledge, and skills needed to access the accounting software. This software obviously is related to the technology advancement and development in a business. The customers who may not have any idea on how to operate it may be forced to give up and search for a simpler software in a different business. In regard to the employees who use the accounting software to complete their daily responsibilities, they may also lack the experience of working with the new accounting software. Therefore this is likely going to reduce their morale and commitment to work which may lead to business failure and hence no objective achievement.

NAB business should ensure that its accounting software packages are simple, easy to understand and easy to operate. This is especially for the sake of the customers who may not have idea or knowledge about operating the systems.

In addition to that, the bank should make sure that prior to the installation or implementation of the accounting software packages, the accountants or any other employee who may be engaged in the use of those packages are notified. This will prepare them psychologically and mentally which will help them adapt easily. Also, the business should conduct a training for the employees to teach them about the software and how they are supposed to be operated.  

References

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