STEPPING I.T.

UP FOR CRUZ-
CAYMO, PARTNERS, AND
ASSOCIATES

I. Point of View
The point of view of Dr. Maria Cristina Cruz-Caymo, one of the founders and the
managing partner of Cruz-Caymo, Partners and Associates (CP&A) will be taken in
analyzing the case. Being the manager and the most knowledgeable person in the
company’s operations, it is her responsibility to initiate and implement major changes
in the organization, with the approval of all other business partners.

II. Problem Statement

Given the employee's concerns and needs, and the customers’ needs as well, what
should be the most appropriate organizational improvements that CP&A should
adopt to improve its overall business operations? 

III. Analysis of Case Situation 

a. Macro-environment Analysis 

Technological

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GROUP6: CASE ANALYSIS REPORT: STEPPING I.T. UP FOR CP&A
 Technological advancements have brought significant changes in different business
segments. Timely communication about the status of services to clients,
transparency on business processes and automation becomes a competitive
advantage of businesses nowadays. Hence, the recent expansion and additional
clients and to respond with the current trend on business technology for office
operations require CP & A to upgrade their current I.T. infrastructure. 

Economical

The Philippine economy is in a robust state, many MSME emerge, and the need for
accounting and business consultancy services is in high demand.

Socio-cultural/Demographic

CP & A is strategically located in the national capital region and Calabarzon,where

almost 40% of the country’s SMEs are located.

b. Industry Environment Analysis 

Competitors

Accounting firms are clustered into groups according to size. In the Philippines, the
five identified big accounting firms are SGV, Manabat Delgado Amper & Co, Isla
Lipana & Co., Manabat-San Agustin & Co., and Punongbayan and Araullo which
offer the same services as the CP&A. However, it is the small- and medium-sized
accounting firms which are considered competitors by the company.

Aside from offering regular accounting and auditing services, CP&A also specializes
on business consultancy jobs like business registration, providing management and
organization advice among others a starting business may need on its start-up
operation.

Customers

MSMEs are business enterprise engaged in industry or agri-business/services with a

total asset- inclusive of loans but exclusive of land on which the business is situated-
have a value under the following categories:

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 Micro Up to PhP 3,000,000

Small PhP 3,000,001- PhP 15,000,000

Medium PhP 15,000,001- PhP 100,000,000

Large Above PhP 100,000,000

Source: Small and Medium Enterprise Development Council Resolution No. 1, Series of 2003 dated 16 January
2003.

According to the Department of Trade and Industry, MSMEs account for 99.6% of the
total registered enterprises. 90.3% were micro enterprises, 9.3% were small
enterprises, and 0.4% were medium enterprises.  Majority of the MSMSEs were
located in the National Capital Region, Region 4A and Region 3, among other
regions.
CP&A target markets were the micro, small and medium enterprises which
constituted the biggest percentage of MSMEs classification in the country. Its two
branches are also strategically located to capture the markets in NCR and Region
4A.

Different from other accounting firms, CP & A has a unique and  wide array of clients
from different industries and interests, like banking, BPO, manufacturing plants,
construction, religious organization, medical allieds and many others. 

c. Company Analysis

Mission and Values

CP&A was established to cater to the need for professional guidelines of Small and
Medium-Sized Entities (SMEs) in the field of accounting, auditing, and taxation. The
firm is dedicated to educating business enterprises on the importance of a well-
maintained accounting system in the carrying out of its activities and good
compliance with the Philippine government requirements.

CP&A’s core values includes 1) passion in delivering super value to clients; 2)

excellence in  everything they do; 3) respect to all individuals and valuing their
contributions; 4) motivation to succeed; 5) being recognized and rewarded with the
team’s achievements; 6) creativity and innovation in products and processes; 7)

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 empowerment of valuable employees and clients to do what is right; and 8) “being
socially responsible to improve the communities where we work and live.

Core Business Process

The firm is primarily organized to conduct different auditing activities including:

 Render bookkeeping and accounting works;
 Install accounting systems, internal controls and budget procedures;
 Act as managers, consultants, managing agents of persons, firms, associations,
partnerships, and other entities;
 Provide management, organizational and technical advice for developing
agencies, organizations, and other kinds of entities;
 Undertake, carry on, assist or participate in the promotion, organization,
management, and reorganization of corporations and partnerships, agencies, and
other entities, particularly those involved in development undertakings.
Its core operational business processes also include the following:
 Business Registration
 Bookkeeping Process
 Tax and Other Statutory Compliance
 Advisory Services
 Audit and Assurance Service
 Agreed Upon Procedures based on clients’ needs
 Monitoring and Control
 Document Retention
  
Organizational Structure

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 As provided in the organizational chart, the firm is small with a flat structure which
means that the chain of command from top to bottom short and the span of control is
wide. This structure has become an advantage for the company as everyone is well
aware of each other’s function. In the event that a problem arises or an employee is
absent, anyone can immediately fill the post and continue with the demands of the
work without delay to provide good customer service. 

IV. SWOT Analysis

Strengths
 CP&A offers diverse core business processes for its operations, and has been
serving various clientele industries.
 The company has multi-talented, competitive and experienced partners and
employees to meet the demands of the clients.
 The firm is small and everyone is well-aware of each function, hence absence of
an employee will not paralyze the operation.
 The employees are capable of performing business technology tasks such as use
of productivity software’s, ability to work remotely, etc.
 The company has a flat organizational structure that promotes faster decision
making and clear communication.
 Has two strategic locations that can capture clientele belonging to Region 4-A and
NCR
 Existing partnership with MYOB distributor to be a reseller of the software.
 Communication channels of CP&A in boosting their market.

Weaknesses
 Span of control is wide which makes managing challenging.
 There are 8 identified Core Business Operations for CP&A that seems a lot for a
small organization.
 Absence of an employee capable of maintaining the company’s website.
 Presence of a lot of communication lines that clients use to reach out to CP&A for
any concern that they may have.
 Reaction of employees to the possible introduction of changes to the organization
such as the time and effort that each will have to devote for the project.

Opportunities

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  Opportunity for public practitioners to be at par with the big accounting firms
locally and globally.

Threats
 Failure to comply with accreditations and CPE programs can prevent the CPA
from practicing public accounting.

SWOT Matrix

Strengths-Opportunities Strategies

 Promote the services offered by the business through different marketing

channels in order to capture more clients.
 Maximize the business opportunity associated with MYOB software
distributorship through promoting its utility to the existing and prospective clients.
Hence, this can be another source of income for the company.
 Capitalize on established core competencies to capture the available market by
responding to existing clienteles’ accounting and bookkeeping needs.

Strengths-Threats Strategies

 Strengthen the quality of services offered by the business particularly those that
cannot be influenced by automation or IT solutions, such as advisory/consultation
services, and audit and assurance services.
 Use available communication channels to inform clienteles of the changes that will
happen in the organization to avoid any negative reactions from them.

Weakness-Opportunities Strategies

 Adopt IT solutions or software related to project management to assist the company

in controlling and monitoring the projects being handled.
 Benchmark with big accounting firms, both locally and globally, to adapt best
practices that would be applicable to the kind of structure they have.

Weakness-Threats Strategies
 Adopt IT solutions or software with user-friendly features or free user training
packages that may prevent confusion, disorientation and other negative reactions
from both employees and clients. 

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V.     Formulation and Evaluation of Alternatives

Alternative 1:

Rethink the organization and review current job description and function to implement an
efficient and effective organizational structure in the company. 

Pros: 

 Faster and more effective decision-making process.   

 The business operations will be more efficient which can be attributed to a well-
defined organizational structure and functional responsibilities.
 The firm can provide exemplary customer service to the clients due to reorganization.
 There is clear accountability in each department.
 Enables centralization of decision-making processes which provides a clear chain of
command.

Cons:

 It is more complex to monitor and control each department.

 The company needs clearly written policies, procedures and guidelines.
 Will incur cost as there might be a need to hire a consultant to do the review.
 Restructuring may entail additional costs due to possible recruitment and promotion
of staff
 Restructure may take time to solve the current problems as it involves planning and
testing of effectiveness.
 Restructuring may result in changes in responsibilities which may affect employee
morale.

Alternative 2:

Maintain the current organizational structure and adopt new technologies (IT solutions) that
will support the company’s operations..

Pros:  

 The close-tie up relationship of the employees will remain.

 Faster communication will be beneficial to the company especially in training the
employees in adopting the new technologies.
 This is cost efficient to the company as some manual jobs can be automated.

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  Increase in operational efficiency brought by the adoption of IT solutions  .
 Adopting new technologies could mean faster response time to clients demands and
requests.

Cons:

 It may add financial cost to the company acquiring the new technologies.
 The firm might have difficulties in adopting the new technologies.
 For software and new technologies, the maintenance and update that might add up
to    financial cost of the company.

Alternative 3:

Rethink the organization and review current job description and function to implement an
effective organizational structure and adopt new technology to support company operations.

Pros:

 The decision-making and communication is faster and easier.

 The firm can maximize the competencies of its employees.
 Increase in operational efficiency particularly on project management.
 Immediate response to the clients demands.

Cons:

 The firm may need to reskill/upskill employees to be able to adapt to the introduction
of new technology. 
 The employees might experience a drop-in morale due to excessive workloads
during the initial stage of adoption to technology which can impact the clients at some
point.
 There will be an additional cost associated with restructuring and adoption of new
technology

Decision Criteria:
 Ease of Implementation: This criterion will assess if the alternative is easy to
implement and convenient for the organization.
 Efficiency: This refers to the ability of the alternative to achieve the best possible
result using less resources.
 Effectiveness: Refers to the ability of the alternative to achieve the desired
improvement needed by the organization.

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 Employee Satisfaction: This criterion refers to the degree of how the alternative will
improve/ease the performance of employee’s work activities.
 Client Satisfaction: This criterion is important to measure the effectiveness of the
alternative in improving services being catered by the organization
 
The following alternatives were ranked in accordance to each decision criteria- 1 being the
highest, and 3 being the lowest. The alternative with the lowest average will be chosen as
the best solution that will resolve the identified problem statement of the case.
 

Alternative Ease of Efficienc Effectivenes Employee Client Total

s Implementatio y s Satisfactio Satisfactio
n n n

Alternativ 1 3 3 2 3 2.4
e1

Alternativ 2 1 2 1 2 1.6
e2

Alternativ 3 2 1 3 1 2
e3

 VI.          Decision

From the evaluation of the Pros and Cons of each alternative given, the group came up with
a mutual decision of choosing Alternative 2 as the best response to the problem statement of
the case analysis. With this decision CP&A will maintain the current organizational structure
and adopt new technologies that will support the company’s operations.

Based on the decision criteria which consists of the following, ease of implementation,
effectiveness, efficiency, employees’ satisfaction, and customer satisfaction. For the ease of
implementation, it will be easier for the company as they maintain the organizational
structure employees will be familiar with in the system and process. In employee’s
satisfaction and customer satisfaction, adopting new technology can have a faster
transaction to the demand of customers at the same time it will help the employees to
become efficient and accurate in providing service. 

VII. Implementation Plan

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From the decision made, the group came up with the recommended implementation plan of
the case analysis.

1. Identify and review current operational challenges and areas that need improvement.
2. Source out for possible providers that can offer the most appropriate software based
on the needs of the company.
3. Evaluation and selection of software providers. Assemble a team in the organization
that will conduct the evaluation of the software providers. Develop a selection
criterion which may include price, features, and platform, among others which may
help the team in decision making. 
4. Conduct of UAT (User Acceptance Testing) by the Team members as identified in
Step #3 to check on the selected software’s ease of use and adaptability.
5. Modify or maintain the selected software based on the UAT experience.
6. Training of employees on the use of the software.
7. Release of communication to all clienteles to introduce the use of the new software.
8. List all possible concerns from client-users based on their experience using the
software.
9. Refinement of process and implementation of additional software modifications, as
needed.
10. Actual (live) software deployment, allowing users to transact and utilize the system.
11. Evaluation of the project and development of a feedback system.

VIII. Potential Problem Analysis

Technological advancement may cause system obsolescence and requires frequent

upgrading. Additional costs will be incurred in maintaining an updated system. There are
also risks associated with outdated software such as business process and functionality
disruption, protection measures and breach of sensitive company information.

IX. Contingency Plan

Strengthen competency on skills that cannot be replaced by technology and automation

such as advisory and consultancy services, and audit and assurance service. These
services together with excellent customer service will somehow serve as their competitive
advantage. In the long run, as technology advances for all industries, it is the kind of
relationship and customer experience that will count. They should ensure that they invest
with skills that technology will not be able to copy by continuous attendance to all relevant
training.

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