PROBLEM DEFINITION
In the 21st century keeping a track of all the expenses and spending habit seems tedious and overwhelming. Finance is the life blood of any economy and, therefore, financial management forms an important part of the study associated with managing and controlling finances not only in business but also in our personal lives (Kezar and Yang, 2010). In a country like India, with severe income disparity where the 1% richest own 53% of country’s wealth and the high income group dominating the lower income groups, effective wealth management has a pivotal role to play (World Economic Forum, 2016). Globalisation is constantly leading to the mismanagement of incomes and expenditures. It has become very crucial for all individuals, particularly the middle and lower income groups of people to manage their income and expenses in an organised manner in the recent times. Modern lifestyle with increasing number of social gatherings and snob appeal among individuals has also led to the increase in the personal expenditure along with expenses on the daily necessities (Babin and Attaway, 2000).
People find it difficult to take out spare time to sit and write down all the day to day expenses and, gathering receipts (paper or electronic) for every purchase is one heck of a task. Paper receipts often get piled up in our drawers as well as bloat your wallet whereas going through all our emails in search of receipts is also a time taking process. The use of paper receipts is also considered to be unsustainable as many times people throw away the receipts if they do not require it for future references. The problem with paper bills also comes when we want to get certain product(s) exchanged from a store, we need to produce the receipt for that transaction and if the receipt is lost, it becomes quite difficult to get the product exchanged. Also, there are certain small purchases for which we do not have receipts and we forget to keep a track of these petty expenses which ultimately affects the total expenses.
This research project will focus on resolving the challenges faced by the people in tracking everyday expenditure and organising receipts using a platform where individuals can record and maintain all their day to day expenses on the go. The creation of any business begins with correctly identifying the problems around us, understanding it and then working on it to develop something valuable (The Entrepreneur, 2017). Looking into problems and analysing these problems from different approaches to develop a potential solution creates an entrepreneurial opportunity (Wilson, Greenberg and McKone-Sweet, 2011). This research will follow the problem-solving approach by seeking out gaps in the competitive financial market which will lay the foundation for an entrepreneurial journey.
SCOPE FOR DEVELOPMENT
The recent innovations and developments in the field of technology with the proliferation of smart phones and tablets, India ranks second as the world’s largest smartphone market with more than 220 million users (Bhattacharya, 2017). According to a report, smartphones are doing wonders for mobile-application economy and India’s mobile app market has been growing significantly with Indians downloading over 6 billion apps in 2016 (Choudhary, 2017). The development of mobile-app for expenditure monitoring and tracking will help people to store all the receipts (paper or e-receipts) in one place as well as note down other expenses instantly on their smartphone along with the snapshot of receipts in a sustainable manner (Binswanger, 2001). This app will also contain many other features that will enable people to check and manage their personal finances anywhere and anytime.
RESEARCH REVIEW AND DESIGN PROPOSITION
The literature review will give an overview of the relevant research theories of the past relating to this area and which will help in developing design proposition for this research project. The research revolves around these four questions as follows:
1. How can effective expense management contribute to the wellbeing of an individual?
2. How can cloud service facility enhance the value of the app?
3. How can expense management lead to sustainability?
Effective Expense Management
The development of user centred technology for managing household and individual budgeting help people to effectively forecast, track and reflect upon the spending habits of individuals at anytime and anywhere (Hilgerth, Hogarth and Beverly, 2003). The main objective to manage personal financial expenses is to consider various factors that might influence personal financial situation at present or in future either positively or negatively (Swart, 1996). People can update and monitor their daily expenses in a hassle-free manner by simply scanning the paper receipts in an instant, e-receipts can be archived from email and some transactions can also be entered manually to keep a record of all expenses on a particular date to store all the bills in one place in the app (Wadsworth, Guido, Griffin and Mandil, 2010).
India’s smartphone market in the world is consistently growing with over 27.5 million devices sold only in the second quarter of 2016 (Rampton, 2017). According to a report, users spend 22% of their time on apps out of 72% time on the smartphone (Alawadhi, 2016). The strategic digital transformation will help individuals in recording and tracking all expenses and effectively plan their finances for future according to their free time (Forbes India, 2017). Mobile apps will be user friendly medium of recording expenditure and will make expense management more convenient and time saving process, posing various advantages over traditional methods of maintaining expenses. Financial eductation helps students to apply the theoretical financial knowledge and learning in real life to avoid financial hardships due to unorganised expense management (Chen and Volpe, 1998). Financial planning and efficient expenditure management from an early stage will help in setting future financial goals and retirement plans (Lusardi and Mitchell, 2011).
Cloud Service Facility
Cloud Services (cloud computing and storage) have become popular in recent times because of easy accessibility to data anywhere and anytime (Jain, 2012). The strategic and technological advancements in the emerging mobile-app market is highly impacting the billing process and how it is stored on the app and cloud in virtualised pool of storage units to allow users to check the data at their convenience (Reuver, Koning, Bouwman and Lemstra, 2009). The increased utilisation of wireless internet and other electronic devices which can be remotely operated have been continuously rising and an integrated measurement, control and billing system for home utilities can be easily accessed by combining the existing technologies which gives the users detailed view of the integrated services to help them estimate the future usage and cost of the home utility services (Al-Rousan and Al-Ali, 2006). Many a times it has happened that a buyer of a product or service cannot provide relevant evidence of their purchase when required as most of the receipts are printed on the thermal paper and information on the receipts fades away over time, in this case receipts can be preserved by moving it to cloud (Goel and Patel, 2013). Cloud computing and storage system have revolutionised the world of data storage by allowing the users easy and a more convenient way of accessing their utility services data anytime (Buyya et al., 2008). This shows a good scope for development of businesses offering cloud services along with the app.
Sustainability
Sustainability and corporate social responsibility has become the key criteria of every business towards development of a more efficient economy. Sustainable development aims to give an integrated approach towards understanding the relationship of humanity between nature and people (Hopwood, Mellor and O’Brien, 2005). It also gives a holistic overview of the importance of natural resources and its substitutes to satisfy the needs of the future generations by presenting unprecedented opportunity for global scale safe technological development (Sachs, 2012). The world has begun to realise the importance of “going green” and is following “going paperless” approach by using electronic document management in an attempt to reduce carbon footprints caused by the increase in global warming (Johnston and Spencer, 2005). Synchronised means of new and improved technology, changing values, growing education and information system and improved management operate in the industrial market to achieve sustainable development. In today’s global world of electronics, people prefer getting information in seconds and electronic documents are easier to access and helps in saving both time and money, thereby leading to efficiency and sustainable growth of the economy as a whole (Phelan, 2003).
DESIGN PROPOSITION
The design proposition will be based on the literature review refering to storing and managing expenditure on a day to day basis through a common platform. The key assumptions can now be derived from the relevant prior research and theory which will further help in developing the business model. The study will explore different techniques to implement the idea serving as a preliminary design rule which will require qualitative and quantitative testing. The design propositions will be tested to ensure feasibility of the project. In accordance with the relevant theories of the past, few design positions that can be concluded as of now are:
Proposition 1
In today’s digitalised world, digitising all the receipts, storing and retrieving it in one place will enhance customer experience and will ensure systematic and organised way of managing present as well as future income and expenses.
Proposition 2
The use mobile applications are on surge and with thousands of apps and on demand mobile services, recording and maintaining the receipts on smartphones will be time saving as these will prevent the users from the hassle of searching through all the paper bills or emails and will also be cost effective for the retailers.
Proposition 3
In today’s world which is moving towards sustainability and going green approach, providing e-receipts or using green paper for printing receipts would be a step towards more efficient and sustainable economy.
RESEARCH STRATEGY AND DATA SOURCES
The research will take place in Kolkata, India for approximately 2-2.5 months to analyse the feasibility and popularity of the project which will further decide its scope for expansion in different cities of India. The main objective of this project is to inculcate in the people the importance of good budgeting. Primary data collected will be backed by the secondary data and the research will combine both the qualitative and the quantitative methods of data collection.
Proposition 1
This proposition aims to provide the people with a user friendly app to inculcate the habit of maintaining, tracking and storing the expenses and income in one place and in a more organised manner. It is first important to know how many people actually note down their daily expenses and how do they maintain the receipts for all their purchases. It is also known that different category of people pose different spending habits so the survey needs to be conducted accordingly.
In order to test this proposition both quantitative and qualitative data will be required. This survey will aim to target different categories of people which comprises of working people, housewives, students, retired people. Expenditure management is vital for all category of people. Different questionnaires for interview will be prepared for different categories to know their view of the people on effective expense management, how do they manage their expenses and what problems do they face. About 5 people of each category will be interviewed to understand their viewpoint on the same and simultaneously analyse the emerging market trends of digitalisation.
Personal interviews will be conducted among retired people either face to face or on telephone. The rest of the people will be approached via email as this will be quicker and more convenient than any other method used.
Proposition 2
This proposition will require careful examination of the emerging trends in the smartphone industry, mobile-app industry and the number of people using these technologies. The two most important elements- cost and time drives the customer’s purchase decision. The main objective of this proposition is to give the users customer friendly experience in a non-intrusive way.
This approach will focus more on the secondary data and detailed study will be conducted based on the qualitative and quantitative data. Articles related to similar services in the past will be referred, to give a basic idea about the problems associated with these services and how it was tackled. It is also important to know the number of services people are subscribed to for which they have to pay subscriptions monthly or quarterly. A deeper insight on the literatures related to expense management, time-saving and cost-effective practice, cloud computing services and going green will provide with the relevant theories that were used in the past. Market statistics from different sources will be collected to determine the success in the mobile app industry. The primary survey through an interview will be conducted among all the categories of people which will help in better understanding the preferences of an app user. The data collected from the primary and secondary sources will be synthesised to conclude the scope of business.
Proposition 3
The third proposition aims to create a more efficient and sustainable economy. Research for this proposition will focus more on the secondary data collected from articles related to current environmental practices. Interviews will be carried out to understand the customers view on digital receipts and paper receipts. In relation to this, questionnaire will be prepared to develop a clear understanding of modern day business in sync with sustainability.
This proposition will target all the people to determine their preference of receipts and their view on eco-friendly methods of carrying out business. Thus, the primary data will be collected through interviews and the secondary data will be collected from recent news articles that will give an insight on sustainable development of the economy.
DESIGN AND FEATURE OF THE APP
The app will be designed as such to store all the receipts in one place in accordance to day and monthly expenditures. It will also serve as a reminder for all the subscriptions. This app will act as a handy notebook for recording all income and expenses anywhere and anytime. The main features will be as follows:
1. Tab to upload snapshot of the paper receipts
2. Tab to archive e-receipts from emails
3. Tab to enter expenses manually
4. Tab for reminding the dates of all subscriptions
5. Connected to cloud storage for easy accessibility
MAJOR RISKS AND MITIGATION
The project demands both primary data and secondary data in order to evaluate the feasibility of the project in solving the problems under consideration. The primary data is collected through interviews and surveys which may not give accurate result and cannot be completely relied on as these are based on personal opinions and can be biased at times. The secondary data is based on the research of other people and is collected from relevant sources, therefore, no major risk can be expected.
One of the risk associated with working people will be related to time. Generally, they are busy and do not prefer to reply to surveys during working days and hours. Also, due to summer break, they might be on holiday and would refrain from replying to such emails. This can cause delay in the progress of the project. In order to mitigate such risk, personal interviews can be conducted through telephone, video call on weekends with prior appointments.
The housewives are generally skeptical about disclosing the personal expenditure details over emails and there is a high possibility of them ignoring emails containing such questionnaires. Therefore, the expected response rate will be low. In this case, a certain time period needs to be set within which the response can be expected. If the emails are not responded to within the set time period then personal interview can be conducted.
The problem with the students will be low response rate during summer break either due to their involvement in internships or holiday plans. In such a case, personal interview can be conducted for those students who do not respond to the emails.
The survey among the retired people will be conducted through personal interviews will be time consuming and this group of people might be uncomfortable in disclosing their spending habits. Thus, it will be better to first explain them the purpose of this survey and discuss with them the advantages of this project which will help them to open up and give unbiased answers.
A research strategy along with proper qualitative and quantitative data analysis will help in formulating an efficient business model.