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What is E-Business?
Use of Internet & other networks & IT to support electronic commerce, enterprise communications & collaboration, & web-enabled business processes, both within a networked enterprise & with its customers & business partners.
What is Cross-Functional Enterprise Systems?
IS that cross the boundaries of traditional business functions in order to reengineer & improve vital business processes all across the enterprise
What is Enterprise Application Integration?
EAI is the software that integrates a variety of enterprise application clusters by letting them exchange data according to rules derived from the business process models developed by users.
What does Enterprise Application Integration (EAI) do?
- Enables users to model business processes/interactions between business applications.
- Provides middleware that performs data conversion & coordination, application communication & messaging services, & access to the application interfaces involved.
- Integrate a variety of enterprise application clusters by letting them exchange data according to rules derived from the business process models developed by users.
- Integrate front-office & back-office applications of an e-business to work together. This is vital business value to respond quickly & effectively to business events & customer demands.
Definition of Transaction Processing Systems (TPS)
- Cross-functional information systems that process data resulting from the occurrence of business transactions
- Transactions – events that occur as part of doing business
- Online Transaction Processing Systems (OLTP) – real-time systems that capture & process transactions immediately
What is the Transaction Processing Cycle?
- Including transaction documents, transaction listings & error reports.
- Making inquiries & receiving responses concerning the results of transaction processing activities.
- Updating corporate databases of an organization to reflect changes resulting from day-to-day business transactions
Definition of Enterprise Collaboration Systems (ECS)
Cross-functional information systems that enhance communication, coordination, & collaboration among the members of business teams & workgroups
What is the goal of ECS?
- Communicate – share information
- Coordinate – coordinate individual work efforts & share resources
- Collaborate – work together cooperatively on joint projects & assignments
Definition of Functional Business Systems (FBS)
Information systems that support the business functions of accounting, finance, marketing, operations management, & human resource management.
What is Interactive Marketing?
Customer-focused marketing process that is based on using the Internet, intranets, & extranets to establish two-way transactions between a business & its customers or potential customers. Goal is to use networks to attract & keep customers who will become partners with the business in creating, purchasing, & improving products & services.
What is Targeted Marketing?
Tool for developing advertising & promotion strategies to strengthen a company’s e-commerce initiatives, as well as its traditional business venues.
What is Sales Force Automation?
IS that improve the delivery of information & support to salespeople to improve sales productivity & marketing responsiveness.
Definition of Manufacturing Systems
IS that support the production/ operations function that includes all activities concerned with planning & control of processes producing goods & services
Objectives of Computer-Integrated Manufacturing (CIM)
- Simplify production processes, product designs, & factory organization as a vital foundation to automation & integration
- Automate production processes & business functions that support them with computers, machines & robots
- Integrate all production & support processes using computer networks, cross-functional business software, & other information technologies
Types of CIM
- Computer-aided manufacturing (CAM) - Information systems that automate the production process
- Manufacturing execution systems (MES) – performance monitoring information systems for factory floor operations
- Process Control – control ongoing physical processes
- Machine Control – controls the actions of machines
HRM & the Internet/Intranet
- Recruiting employees through recruiting services & databases on the World Wide Web
- Posting messages in selected Internet newsgroups
- Communicating with job applicants via e-mail
- Process common HRM applications
- Allow HRM department to provide around-the-clock services
- Disseminate valuable information faster than through previous company channels
- Collect information from employees online
- Allow managers & other employees to perform HRM tasks with little intervention by the HRM department
Why Study CRM?
Easier than ever for customers to compare shop and, with a click of the mouse, to switch companies. As a result, customer relationships have become a company’s most valued asset.
Definition of CRM
Use of IT to create a cross-functional enterprise system that integrates & automates many of the customer-serving processes in sales, marketing, & customer services that interact with a company’s customers
CRM Application Components
- Contact & Account Management – helps sales, marketing, & service professionals capture & track relevant data about past & planned contact with prospects & customers, etc.
- Sales – provides sales reps with tools & company data sources needed to support & manage sales activities, & optimize cross-selling & up-selling
- Marketing Fulfillment – help marketing professionals accomplish direct marketing campaigns by automating such tasks as qualifying leads for targeted marketing, & scheduling & tracking direct marketing mailings
- Customer Service & Support – provides service reps with software tools & real-time access to common customer database shared by sales & marketing professionals
- Retention & Loyalty Programs – help a company identify, reward, & market to their most loyal & profitable customers
Three Phases of CRM
- Acquire new customers by doing a superior job of contact management, sales prospecting, selling, direct marketing, & fulfillment
- Enhance relationship with customer by supporting superior service from a responsive networked team of sales & service specialists & business partners
- Retain & expand business with customers by proactively identifying & rewarding the most loyal & profitable customers
Benefits of CRM
- CRM allows a business to identify & target their best customers so they can be retained as lifelong customers for greater & more profitable services.
- CRM makes possible real-time customization & personalization of products & services based on customer wants, needs, buying habits, & life cycles.
- CRM can keep track of when a customer contacts the company, regardless of the contact point.
- CRM systems can enable a company to provide a consistent customer experience & superior service & support across all the contact points a customer chooses.
- Lack of understanding & preparation
- Rely on CRM to solve business problem without first developing the business process changes & change management programs that are required
- CRM projects implemented without the participation of the business stakeholders involved
Definition of ERP
A cross-functional enterprise system driven by an integrated suite of software modules that supports the basic internal business processes of a company
- Quality & Efficiency – ERP creates a framework for integrating & improving a company’s internal business processes that results in significant improvements in the quality & efficiency of customer service, production, & distribution
- Decreased Costs – Significant reductions in transaction processing costs & hardware, software, & IT support staff
- Decision Support – Provides vital cross-functional information on business performance quickly to managers to significantly improve their ability to make better decisions in a timely manner
- Enterprise Agility – ERP breaks down many former departmental & functional walls of business processes, information systems, & information resources
Costs of ERP
- Costs and risks involved in implementing ERP are considerable.
- Hardware & software costs are a small part of total costs. The costs of developing new business processes (reengineering) and preparing employees for the new system (training and change management) make up the bulk of implementing a new ERP system.
- Converting data from previous legacy systems to the new cross-functional ERP system is another major category of ERP implementation costs.
Causes of ERP Failures
- Business mangers & IT professionals underestimate the complexity of the planning, development, & training needed
- Failure to involve affected employees in the planning & development phases
- Trying to do too much too fast in the conversion process
- Failure to do enough data conversion & testing
Trends in ERP
- ERP packages gradually being modified into more flexible products in terms of adopting more open, flexible, standards-based architectures.
- Growth of Internet/ Intranets/ Extranets prompted IT companies to Web-enable their ERP software – to use Internet technologies to build Web interfaces & network capabilities into ERP systems, making them easier to use and to interconnect.
- Development of inter-enterprise ERP systems that provide Web-enabled links between key business systems of a company and its customers, suppliers, distributors, and others.
- ERP/IT companies developed modular, Web-enabled software suites that integrate ERP, CRM, SCM, procurement, decision support, enterprise portals, & other business applications and functions. Such practice enables client companies to run most of their business processes using one web-enabled system of integrated software and databases, instead of a variety of separate e-business applications.
How could some of the spectacular failures of ERP systems have been avoided?
Business managers and IT professionals have been the major cause of ERP failures. The reason given is that these individuals underestimate the complexity of the planning, development, and training that are needed to prepare for a new ERP system that would radically change their business processes and information systems. Failure to involve affected employees in the planning and development phases and change management programs, or trying to do too much too fast in the conversion process, are also typical causes of failed ERP projects. Insufficient training in the new work tasks required by the ERP system, and failure to do enough data conversion and testing, are other causes of failure. In other cases, ERP failures are also due to over-reliance by company or IT management on the claims of ERP software vendors or the assistance of prestigious consulting firms hired to lead the implementation.
Definition of SCM
A cross-functional interenterprise system that uses IT to help support & manage the links between some of a company’s key business processes & those of its suppliers, customers, & business partners
Definition of EDI
Involves the electronic exchange of business transaction documents over the Internet & other networks between supply chain trading partners
- Supply Chain Design – optimize network of suppliers, plants, & distribution centers
- Collaborative Demand & Supply Planning – develop accurate forecast of customer demand by sharing demand & supply forecasts across multiple tiers
- Materials Management – share accurate inventory & procurement order info., ensure materials required for production are available in the right place at the right time, & reduce raw material spending, procurement costs, safety stocks, & raw material & finished goods inventory
- Collaborative Manufacturing – optimize plans & schedules while considering resource, material, & dependency constraints
- Collaborative Fulfillment – commit to delivery dates in real time, fulfill orders from all channels on time with order management, transportation planning, & vehicle scheduling, & support entire logistics process, including picking, packing, shipping, & delivery in foreign countries
- Supply Chain Event Management – monitor every stage of supply chain process, from price quotation to the moment customer receives product, & receive alerts when problems arise
- Supply Chain Performance Management – report key measurements in supply chain, such as filling rates, order cycle times, & capacity utilization
- Faster, more accurate order processing
- Reductions in inventory levels
- Quicker times to market
- Lower transaction & material costs
- Strategic relationship with suppliers
Causes of SCM Failures
- Lack of proper demand planning knowledge, tools & guidelines
- Inaccurate or overoptimistic demand forecasts
- Inaccurate production, inventory & other business data provided by a company’s other information systems
- Lack of adequate collaboration among marketing, production, & inventory management departments within a company
- Immature, incomplete or hard to implement SCM software tools