Information Technology

1. Enterprise ApplicationsEnterprise Applications
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information SystemsChapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise
• Enterprise applications are systems that span
functional areas and automate processes for
multiple business functions and organizational
areas; they include:
• Enterprise systems
• Supply chain management systems
• Customer relationship management systems
• Knowledge management systems

2. Enterprise Systems
• What Are Enterprise Systems?
• Based on integrated software modules and a
common central database
• How Enterprise Systems Work
• Best practices – most successful solutions
• Business Value of Enterprise Systems
• Increase operational efficiency
• Support decision making and rapid responses to
customer requests
• Include analytical tools to evaluate overall
performance
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Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications

3. • Also known as enterprise resource planning (ERP)
systems
• Integrate key business processes of an entire firm
into a single system enabling managers of large
firms to assemble an overall view of operations
Enterprise SystemsEnterprise Systems
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information SystemsChapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise

4. Enterprise Systems
Enterprise systems feature a set of integrated software modules and a central
database that enables data to be shared by many different business
processes and functional areas throughout the enterprise
How Enterprise Systems WorkHow Enterprise Systems Work

5. Enterprise Systems
ENTERPRISE
APPLICATION

6. Firm structure and organization: One
organization
•Management: Firm-wide knowledge-based
management processes
•Technology: Unified platform
•Business: More efficient operations and
customer-driven business processes
Benefits of Enterprise Systems

7. •Difficult to build: Require fundamental changes
in the way the business operates
•Technology: Require complex pieces of
software and large investments of time, money,
and expertise
•Centralized organizational coordination and
decision making: Not the best way for the firms
to operate
Challenges of Enterprise Systems

8. Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications
The Supply ChainThe Supply Chain
• A network of organizations and processes for
procuring raw materials, transforming them into
products, and distributing the products
• Upstream supply chain: firm’s suppliers,
suppliers’ suppliers, processes for managing
relationships with them
• Downstream supply chain: organizations and
processes responsible for delivering products
to customers
Supply Chain Management Systems

9. Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications
Supply ChainSupply Chain
Supply Chain Management Systems
Figure 8-2
This figure illustrates the major entities in Nike’s supply
chain and the flow of information upstream and
downstream to coordinate the activities involved in buying,
making, and moving a product. Shown here is a simplified
supply chain, with the upstream portion focusing only on
the suppliers for sneakers and sneaker soles.

10. • Aim to move the correct amount of product from
source to point of consumption as quickly as
possible and at the lowest cost
• Used by firms to manage relationships with
suppliers, purchasing firms, distributors, and
logistics companies through shared information
about orders, production, inventory levels, and
more
• Automate the flow of information across
organizational boundaries
Supply Chain Management SystemsSupply Chain Management Systems
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information SystemsChapter 2 E-Business: How Businesses Use Information Systems
Features

11. Supply Chain Management
Network of organization and business
processes for procuring materials,
transforming raw materials into intermediate
and finished products and distributing the
finished products to customers.
•Helps in distribution of the finished products
to customers
•Includes reverse logistics - returned items
flow in the reverse direction from the buyer
back to the seller

12. Supply Chain Management (SCM(
•Close linkage and coordination of activities involved in
buying, making, and moving a product
•Integrates supplier, manufacturer, distributor, and
customer logistics time
•Reduces time, redundant effort, and inventory costs
•Helps in procurement of materials, transformation of
raw materials into intermediate and finished products

13. Information and Supply Chain ManagementInformation and Supply Chain Management
• Inefficiencies cut into a company’s operating costs
• Just-in-time strategy
• Safety stock
• Bullwhip effect – information about the demand for
a product gets distorted.
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications
Supply Chain Management Systems

14. Supply Chain Management ApplicationsSupply Chain Management Applications
• Information visibility – open and rapid communication
and information sharing
• Supply chain planning systems – enables the firm to
generate demand forecasts
• Demand planning – determines how much product a
business needs to satisfy customer’s demands
• Supply chain execution systems – manages the flow
of products through distribution centers
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications
Supply Chain Management Systems

15. Supply Chain Management and the InternetSupply Chain Management and the Internet
• Intranets – to improve coordination among their internal
supply chain processes
• Extranets – to coordinate supply chain processes shared
with their business partners
• Demand-driven supply chains
• Push-based model – production master schedules are
bases on forecasts
• Pull-based model – actual customer orders trigger
events in the supply chain
• Digital logistics nervous systems
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications
Supply Chain Management Systems

16. Push- Versus Pull-Based Supply Chain ModelsPush- Versus Pull-Based Supply Chain Models
The difference between push- and pull-based models is
summarized by the slogan “Make what we sell, not sell what we
make.”
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications
Supply Chain Management Systems

17. • Match supply to demand
• Reduce inventory levels
• Improve delivery service
• Speed product time to market
• Use assets more effectively
• Reduced supply chain costs lead to increased
profitability
• Increased sales
Business Value of Supply Chain Management SystemsBusiness Value of Supply Chain Management Systems
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications
Supply Chain Management Systems

18. How IS can facilitate Supply Chain
Management System
•Decide when and what to produce, store and
move.
•Rapidly communicate orders
•Track the status of orders
•Check inventory availability and monitor
inventory levels
•Reduce inventory, transportation and warehousing
costs
•Track shipments
•Plan production, based on actual customers
demand
•Rapidly communicate changes in product design

19. Limitations:
•Inefficiencies can waste as much as 25% of
company’s operating costs
•Bullwhip Effect: Information about the demand
for the product gets distorted as it passes from
one entity to next
Supply Chain Management (SCM)
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Chapter 2 Information Systems in the EnterpriseChapter 2 Information Systems in the Enterprise
ENTERPRISE APPLICATIONS

20. Supply Chain Management System:
•Planning System
(Capabilities(
–Order Planning
–Advanced scheduling
–Manufacturing
Planning
–Demand Planning
–Distribution Planning
–Transportation Planning
•Execution System
(Capabilities(
–Order Communication
–Final Production
–Replenishment &
Refilling
–Distribution
Management
–Reverse Distribution

21. What Is Customer Relationship Management?What Is Customer Relationship Management?
• Knowing the customer
• Touch points (Contact points)
• Single enterprise view of customers
• Data and analytical tools answer important
questions about customers
Customer Relationship Management Systems
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications

22. • Coordinate all of the business processes that deal
with customers to optimize revenue and customer
satisfaction, and increase sales
• Sales, marketing, and service record data from
multiple communication channels can be
combined
Customer Relationship Management SystemsCustomer Relationship Management Systems
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information SystemsChapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise

23. Customer Relationship Management (CRM(
•Manages all ways used by firms to deal with existing and
potential new customers
•Business and Technology discipline
•Uses information system to coordinate entire business
processes of a firm
Customer Relationship Management (CRM)
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ENTERPRISE APPLICATIONS

24. •Provides end-to-end customer care
•Provides a unified view of customer across the
company
•Consolidates customer data from multiple
sources and provides analytical tools for
answering questions
Customer Relationship Management (CRM)
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Chapter 2 Information Systems in the EnterpriseChapter 2 Information Systems in the Enterprise
ENTERPRISE APPLICATIONS

25. Customer Relationship Management (CRM)Customer Relationship Management (CRM)
Figure 8-7
CRM systems
examine
customers
from a
multifaceted
perspective.
These systems
use a set of
integrated
applications to
address all
aspects of the
customer
relationship,
including
customer
service, sales,
and marketing.

26. CRM SoftwareCRM Software
• CRM packages are available with a wide spectrum
of functions
• Partner relationship management (PRM)
• Employee relationship management (ERM)
• Sales force automation (SFA) – focusing sales efforts
on the most profitable customers
• Customer service
• Marketing
• Cross-selling
• Up-selling
• Bundling
Customer Relationship Management Systems
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications

27. • Operational: customer-facing applications such as
sales force automation, call center and customer
service support, and marketing automation
• Analytical: applications that analyze customer data
output from operational CRM applications
• Based on data warehouses populated by operational
CRM systems and customer touch points
• Customer lifetime value (CLTV)
Customer Relationship Management Systems
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications
Operational and Analytical CRMOperational and Analytical CRM

28. Business Value of Customer Relationship ManagementBusiness Value of Customer Relationship Management
• Business benefits:
• Increased customer satisfaction
• Reduced direct-marketing costs
• More effective marketing
• Lower costs for customer acquisition/retention
• Increased sales revenue
Customer Relationship Management Systems
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications

29. Challenges and OpportunitiesChallenges and Opportunities
• Technology changes
• Business process changes
• Organizational changes
• Switching costs
• Data management
Enterprise Applications: New Opportunities and Challenges
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications

30. Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information SystemsChapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise
• Intangible knowledge assets provide value to firms
• Knowledge management systems manage the
capture, storage, distribution, and application of
knowledge so that it can be leveraged for strategic
benefit
Knowledge Management SystemsKnowledge Management Systems

31. Knowledge Management Systems
•Creating knowledge
•Discovering and codifying knowledge
•Sharing knowledge
•Distributing knowledge
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32. • Getting more value from enterprise applications
• Flexibility
• Integration with other systems
• Enterprise suites
• Links to customer and supplier systems
Enterprise Applications: New Opportunities and Challenges
Essentials of Business Information SystemsEssentials of Business Information Systems
Chapter 8 Achieving Operational Excellence and CustomerChapter 8 Achieving Operational Excellence and Customer
Intimacy: Enterprise ApplicationsIntimacy: Enterprise Applications
Extending Enterprise SoftwareExtending Enterprise Software