Part 1: Answer The Module Review Questions Listed Below ✓ Solved

Part 1: Answer the module review questions listed below.

Part 1: Answer the module review questions listed below. These questions were chosen to demonstrate your understanding and help you assess your progress. What is outsourcing? Why would a company choose to outsource? What are the advantages and disadvantages to outsourcing? What are the key challenges in offshore outsourcing? List five best practices in outsourcing. What is SaaS and why is it considered as another outsourcing option? With ERP implementations, why would an auditor get involved? Why is the Sarbanes-Oxley Act important to investors? What should a disaster recovery and business continuity plan include and who should be involved?

Part 2: Prepare a list of the top five to ten security questions you would ask to understand the numerous components to system security and why security must be planned, tested, and ready by the time the ERP implementation is at Go-live.

Paper For Above Instructions

Outsourcing refers to the practice of delegating specific business tasks or processes to third-party organizations or service providers. Companies often choose to outsource for a variety of reasons such as cost reduction, increased efficiency, and access to specialized skills. By outsourcing non-core functions, businesses can focus their resources on activities that directly contribute to their main goals and objectives, thus enhancing overall productivity (Lacity & Willcocks, 2014).

The advantages of outsourcing include cost savings, increased efficiency, and the ability to leverage expertise that may not be available in-house. For many companies, outsourcing allows them to convert fixed costs into variable costs, enabling better management of cash flows and resources. Additionally, outsourcing can provide access to advanced technologies and skilled labor that would be costly or impractical to develop internally (Kakabadse & Kakabadse, 2005). On the downside, outsourcing can introduce challenges such as loss of control over the outsourced functions, potential quality issues, and difficulties in managing vendor relationships (Choudhury & Sabherwal, 2003).

One of the key challenges in offshore outsourcing includes dealing with cultural and language barriers, which can lead to miscommunication and misunderstanding (Gaffney, 2009). Time zone differences may also hinder real-time collaboration between teams situated in different regions. Furthermore, legal and regulatory differences can complicate contracts and compliance, creating additional risks for companies engaged in offshore outsourcing.

To maximize the benefits of outsourcing, companies should adopt best practices such as conducting thorough vendor assessments, establishing clear performance metrics, maintaining effective communication channels, creating robust contracts that protect both parties, and continuously reviewing outsourcing relationships to identify areas for improvement (Leavy, 2004). These practices can help mitigate risks associated with outsourcing and lead to more successful outcomes.

Software as a Service (SaaS) is an outsourcing option that delivers applications over the Internet as a service, rather than being installed locally on individual machines. Companies can benefit from SaaS by reducing the need for heavy IT infrastructure, thereby lowering costs and enhancing scalability and flexibility in software deployment (Benlian & Hess, 2011). This approach aligns with the principles of outsourcing as it allows businesses to access advanced software solutions without the complexities of development and maintenance.

During ERP implementations, auditors play a crucial role in ensuring that the systems are compliant with regulations and that financial data is accurate. The Sarbanes-Oxley Act (SOX) is significant to investors as it establishes strict regulations for financial reporting and corporate governance, seeking to enhance transparency and accountability within publicly traded companies (Klein, 2002). Compliance with SOX can provide investors with confidence in the integrity of financial statements, thereby protecting their investments.

A comprehensive disaster recovery and business continuity plan is vital for any organization transitioning to new ERP systems. Such a plan should outline the procedures and resources necessary to recover from potential disruptions. Key components should include risk assessment, business impact analysis, recovery strategies, and roles and responsibilities of stakeholders involved in the recovery process (Hiles, 2007). It is essential that cross-functional teams are involved, ranging from IT to management, to ensure that all aspects of the organization are prepared for unforeseen events.

For the second part of the assignment, understanding system security is paramount, particularly during ERP implementations. Some significant security questions to consider include:

1. What security measures are currently in place to protect sensitive data?
2. How is access control managed for different user roles within the ERP system?
3. What protocols are in place for data encryption during transmission?
4. How often are security audits conducted, and what do they entail?
5. What incident response plans are established for addressing security breaches?
6. How is employee training on security best practices conducted?
7. What third-party security certifications do our vendors hold?
8. How does the system ensure compliance with relevant data protection regulations?
9. What backup and recovery solutions are available for critical data?
10. How regularly are vulnerabilities assessed and addressed?

Addressing these questions is critical to ensure system security is well-planned and that responses to potential threats are tested and ready by the time the ERP implementation goes live.

References

• Benlian, A., & Hess, T. (2011). November. The influence of cloud computing on the decision to outsource IT. 2011 44th Hawaii International Conference on System Sciences. IEEE.
• Choudhury, V., & Sabherwal, R. (2003). Portals and Knowledge Management: The Role of Knowledge Management Systems in Supporting Relationship Management. Communications of the ACM.
• Gaffney, J. (2009). Cultural Considerations in Setting Up Outsourcing. Journal of Business Strategy.
• Hiles, A. (2007). The Definitive Handbook of Business Continuity Management. John Wiley & Sons.
• Kakabadse, A., & Kakabadse, N. (2005). Outsourcing: Current and Future Trends. The International Journal of Information Management.
• Klein, A. (2002). The impact of the Sarbanes-Oxley Act of 2002 on corporate governance. Business Horizons.
• Lacity, M. C., & Willcocks, L. P. (2014). Outsourcing Business Applications. Business Information Systems. Palgrave Macmillan.
• Leavy, B. (2004). Outsourcing: The New Regularization of Business. The Journal of Business Strategy.