FINANCIAL MANAGEMENT

Financial Management: Montgomery Cosmetic Company

Financial Management: Montgomery Cosmetic Company

Introduction

In our modern day of age, people and businesses, not only in Australia, but all over the world is becoming more and more dependent upon electronic systems, eg; Computers, to make things easier, convenient and business more efficient.

If we want to be able to keep up with the competition from other stock broking companies, we will have to embrace and keep up with technology and the rapidly advances of today. By implementing new systems, containing a website, an intranet and other administrative systems, Montgomery Cosmetic Company should be able to keep up with the competition in this highly competitive stock broking market.

Because our goal is not only to survive, but to prosper, the implementation of the various systems of this proposal is not to be overlooked.

Executive Summary

The current system, which we are using at Montgomery Cosmetic Company is a manual run system. This basically means that every action which is recorded is done so manually. Every input needs to be processed manually, which takes time. The result, output, will then need to be manually recorded. Every memo is distributed through a hand delivered clearance system, Australian Stock Exchange transactions are copied into financial diaries. Information on time management is manually entered into journal entries in a log book, and the advertising department does all of its distribution through catalogues / leaflet delivery service.

It is however believed that these manually run activities, can be done far more efficiently by implementing a new information technology system to handle them.

There are several benefits to the new information system if it is implemented. With a new information technology system, we remove the problem of human error. This would enable us to assess our organisations quality maturity. Further more, journals will automatically be updated, which allows us to focus our human resources elsewhere. Notes and memos which previously have been sent via a hand delivered system will now be dispatched with a touch of a button. A time management system will keep track of how much time each staff spent on each task. Invoices are then billed to the client automatically.

Cost of supplies would be reduced by 30%. Printers and Xerox machines would last 50% longer, due to much lower usage rate.

Operational Feasibility

It is believed that a new system will change the way that the staff in the various departments does its day to day business. Because the information system is custom made, it is believed that it will meet the requirements set forth and that it would therefore be widely used by all, not only in the different departments, but in management as well. (Mark, 2002)

Firstly, a new system would decrease the amount of equipment use, making it last longer, and decrease the use of paper. The time consuming hand delivery clearance system would be eliminated, allowing our staff to spend their time on more important tasks.

Economic Feasibility

To determine the economic feasibility we need to take a look at the price and the payback period of ...