Case Study: Kluuvin Apteekki’s Transition to Cloud-Based Accounting

Kluuvin Apteekki is a small pharmacy in downtown Helsinki, Finland, managed by Pia Moksi, its sole owner and chief pharmacist. As the business has grown, so has the administrative burden, particularly in accounting, prompting Pia to consider cloud-based accounting information systems (AIS) as a potential solution.
The pharmacy’s increasing administrative workload, particularly in accounting, diverted Pia’s attention from strategic business activities. The current accounting process comprises five main groups: sales, purchases, payments, reporting, and payroll. Handling these tasks manually had become inefficient and time-consuming.
Cloud-Based Accounting Information Systems

Cloud-based AIS offers several advantages over traditional systems:

• Real-Time Collaboration: This allows accountants, clients, and auditors to simultaneously access and work on data, enabling a more granular division of tasks.
• Efficiency: Automating many accounting processes reduces manual effort and the potential for errors.
• Scalability and Flexibility: Easily scale services up or down as needed and choose which tasks to outsource while maintaining control.
Evaluation of Cloud Systems

Pia evaluated three cloud-based AIS options, considering factors like user interface, integration capabilities, modularity, and price. She had to weigh the benefits of improved

efficiency and potential cost savings against concerns about data security, potential lock-in with providers, and integration challenges with existing systems.
Key Considerations

1. System Selection: Pia needed to choose a system that balanced usability, integration capabilities, and cost. Options included:
   o System 1: User-oriented interface with limited customisation, starting at
   €20/month.

o System 2: Function-oriented interface with more integration options, starting at
€69/month.

o System 3: Function-oriented, tied to accounting services, starting at
€150/month.

2. Data Security and Privacy: There were significant concerns about data privacy, potential misuse by service providers, and breaches. Pia needed to ensure robust security measures were in place.
3. Lock-In Risks: Dependency on a single provider posed risks if she wanted to switch services or if the provider faced issues.
4. Cost Considerations: While cloud services promised savings, the pricing model (subscription and transaction fees) required careful evaluation to avoid hidden costs.
   Decision and Strategy

Pia gradually transitioned to cloud-based AIS, starting with selective outsourcing accounting tasks. This approach allowed her to:
• Focus on Core Competencies: Free time to concentrate on business growth and strategic initiatives.
• Maintain Control: Use cloud features to monitor accounting processes and maintain oversight.
• Adapt to Change: Flexibly adjust the level of outsourcing based on business needs and experiences with the system.
Pia planned to outsource payroll and reporting while controlling sales and purchase processes. This selective approach balanced leveraging professional accounting expertise and maintaining strategic oversight of core business processes.

Kluuvin Apteekki’s transition to cloud-based accounting systems highlights the importance of evaluating the opportunities and risks associated with new technology adoption. Pia aimed to enhance the pharmacy’s operational efficiency and position it for future growth by focusing on strategic alignment, data security, and careful system selection. The case underscores the need for businesses to consider
Source: https://hbsp.harvard.edu/

Question 1 [15]

Analyse the significance of strategic alignment between Kluuvin Apteekki’s business objectives and its transition to cloud-based accounting information systems.

In your answer, evaluate the role of strategic alignment in achieving the pharmacy’s goals and the challenges Pia Moksi might face in maintaining it. Discuss frameworks for achieving alignment, such as the Balanced Scorecard and IT Governance, and provide examples of similar businesses that have successfully aligned their strategic goals with information systems.

Question 2 [15]

Evaluate the impact of cloud computing on Kluuvin Apteekki’s data management and organisational agility.

In your answer, discuss how cloud solutions enhance data accessibility, scalability, and cost- efficiency for the pharmacy. Explain how cloud computing supports agile business operations and innovation within Kluuvin Apteekki, and provide examples of other companies that have transformed their data management practices through cloud adoption.

Question 3 [15]

Analyse the ethical implications of data mining and analytics in Kluuvin Apteekki’s business decision-making as it transitions to cloud-based systems.

In your answer, discuss privacy concerns, data protection, and the ethical use of analytics for strategic insights within the pharmacy. Explain how Pia Moksi can ensure ethical practices through transparency and regulatory compliance, and provide examples of companies facing ethical challenges in data mining and analytics.

Question 4 [15]

Discuss the importance of cybersecurity in protecting Kluuvin Apteekki’s organisational assets and information as it moves to cloud-based accounting.

In your answer, examine common cyber threats that the pharmacy might face. Explain strategies and technologies for safeguarding sensitive data and provide examples of organisations strengthening their cybersecurity posture through practical measures.

Question 5 [10]

Examine the role of information systems in enhancing innovation and competitive advantage for Kluuvin Apteekki as it adopts cloud-based accounting.

In your answer, provide examples of how Pia Moksi can use information systems to develop new products and services within the pharmacy. Discuss how information systems enable the pharmacy to respond to market changes and differentiate itself from competitors, and explain the tools and technologies that support innovation, such as collaboration platforms and business intelligence systems.

Note: Ensure your answers are well-structured, clear, and concise. Support your arguments with relevant examples and references where appropriate.

Answers to Above Questions on Business Information Systems

Expert Answer 1: Strategic alignment implies the extent to which the information system of an organization supports its overall business strategy. In the case of Kluuvin Apteekki, it is important for the small pharmacy in Helsinki to ensure strategic alignment. While performing the transition to a cloud-based accounting information system. This is mainly because a proper alignment will result in positive contribution from new technology to accomplish operational efficiency, scalability and ultimately business growth. The benefits to the company from ensuring strategic alignment includes efficiency and time management in performing its processes, better cost control and financial oversight, higher growth opportunities, data integrity and risk management.
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