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E Business Integration. Enabling the Real Time Enterprise

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  • 1. 1 E-Business Integration Enabling the Real-Time Enterprise Johan Blomme Johan
Blomme

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Leenstraat
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8340
Damme
 J.
Blomme
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info@dmreview.be
 1 E-Business Integration. Enabling the Real-Time Enterprise
  • 2. 2 It is not the strongest species that survive, nor the most intelligent ones, but the ones that are most responsive to change. Darwin It’s not longer about the big beating the small, it’s about the fast beating the slow. Larry Carter, CFO Cisco Systems J.
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 2 E-Business Integration. Enabling the Real-Time Enterprise
  • 3. 3 1 2 3 J.
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  • 4. 4 Towards the Real-Time Enterprise 1 J.
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 4 E-Business Integration. Enabling the Real-Time Enterprise
  • 5. Marketplace Dynamics 5 . globalization . new global network information economy . deregulation . value nets as the new economic building blocks . Virtualization . supply chains are shortening and integrating with . competition from new/non-traditional players customer connections . increased competition for deeper and broader customer relationships Competition Business Customer Technology Evolution . from sellers to buyers market . connectivity and interactive technologies pervade all business activity . anyone, anytime, anywhere access . the evolving marketplace is a real-time, interconnected architecture . willing to participate in decisions regarding value they receive J.
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  • 6. Stability and Dyscontinuity 6 According to GartnerG2, businesses must replace industrial age strategy with information-based, real-time processes and paradigms. Time and information will drive the information age, and competitiveness will be based on keener foresight, obtaining real-time information and acting on it promptly and effectively. The following changes indicate how to compete in the information age :   more complex business environments due to globalization and deregulation ;   greater impact of change from external causes ;   a power shift from sellers to buyers, rapidly shifting customer demands and subsequent reduced product life cycles ;   constant technology change ;   faster business cycles and temporary competitive advantage ;   the need to explore collaborative strategies ;   constant change at ever-increasing speeds and shrinking strategy time horizons. J.
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  • 7. The transition from the Industrial Age to the Information Age 7 Industrial Age Information Age Processes: interwoven, collaborative linear, sequential Tempo: continuous, rapid periodic, slow Assets : intangibles tangibles J.
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  • 8. The transition from the Traditional Economy to the New Economy 8 Changing drivers Traditional Economy New Economy Business Imperative products and manufacturing customers and relationships . manufacturer push model . customer pull model . make and sell . sense and respond integrating the shift in power . mass production of goods . mass customization customer . transactions . relations into the value chain . customer as receiver . customer as receiver physical value chain virtual value chain . tangible : technical and . intangible : inter-enterprise basis for market engineering processes and coordination business process integration across the influence . vertical integration . virtual integration extended enterprise . enterprise focused . externally focused . competition . collaboration competence knowledge real-time data driver of market . static content . dynamic content dominance integration and . department/enterprise . business value chain analysis . batch processing . real-time processing The Internet breaks all commerce paradigms. A new business model is emerging. J.
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  • 9. The Real-Time Enterprise 9 Real-Time Enterprise INTEGRATION COLLABORATION the ability to gather, integrate, the ability to collaborate analyze and exchange flexible with suppliers, information across the business business partners and value chain in real-time customers PERSONALIZATION the ability to provide tailored customer services across touchpoints E-business integration : the transformation of internal and external business processes toward customer-centricity based upon service delivery opportunities offered by information and telecommunication technologies to better fulfill the mission of business. J.
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  • 10. 10 Value-Creation in the Relationship Economy 2 J.
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  • 11. Virtual Integration 11 The new Internet business model … relies on information, so instead of things like inventory, you have information. Instead of physical assets you have intellectual assets. And instead of closed business systems, you have collaboration. And companies are able to connect themselves with their suppliers and their customers much more quickly using information. Michael Dell adress at The University of Texas, E-business : Strategies in net time, april 2000 J.
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  • 12. Transactional Model vs Relationship Model 12 TRANSACTION RELATIONSHIP APPROACH DESCRIPTION MODEL MODEL In the transaction-oriented enterprise, value is delivered to the business focus product customer buyer along with the product of service. The role played by the customer in value creation is minimized. In the relationship economy, customers have available a wealth of information at every point in the chain. Customer expectations are extending beyond front-end ordering systems to back-end execution processes (the boundaries between SCM and CRM are blurring). Customers are interacting with different entities at various value model value delivery value creation points along the value chain. No separation exists between the multiple roles, relationships, processes and touchpoints which define the enterprise ecosystem. This is the e-business promise : delivering superior customer experiences across the value chain. The emphasis shifts from streamlining internal processes and supply-chain demand-chain supply chain efficiency which is transaction-oriented (ERP, BPR, efficiency effectiveness process focus JIT) to demand-chain effectiveness which is more knowledge (internal ; intra- (external ; inter- and process-oriented. company) company) Enterprises are migrating from vertically-integrated supply chain organizational focus vertical silos core competencies structures to collaborative trading networks with focus on core competencies. Instead of historical data, demand information extracted as close to the final point of consumption is used to understand planning model forecast-driven demand-driven the real-time market. Information from multiple customer touchpoints is used to create a unified customer view. The perspective is shifting from a single organization to partnerships few extensive partnerships. J.
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  • 13. The Networked Value Chain 13 E-business solutions allow an organization to leverage web technologies to re-engeneer business processes, enhance communications and lower organizational boundaries with their customers (across the Internet), employees (across the corporate Intranet) and its suppliers and partners (across its Extranet). J.
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  • 14. The Relationship Economy 14   In today’s competitive environment, products and services tend to become more and more alike. Therefore, the basis for competitive advantage becomes relationships and personalized services.   To compete, firms must address : –  empowered customers who have equal access to information, an incredible choice of products and services and the ability to choose from suppliers anywhere ; –  consumers who expect a high degree of personalization ; –  speed of business change, requiring flexibility and rapid adoption of new technologies.   To succeed, companies must focus on the quality of the customer experience. This requires : –  customer knowledge : who are my customers ? what do they want ? what is their value potential ? –  interaction strategies / conversations which convert customer knowledge into value propositions (customization : building individual customer solutions across all channels) ; –  the delivery of customer value through an integrated business value chain. J.
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  • 15. The Relationship Economy con’d 15   It’s not enough to manage customer relationships in a vacuum without looking at the value chain as a whole.   As connectivity and interactive technologies pervade all business activity, the competitiveness of a company is determined by its participation in networks of suppliers, partners and customers.   Customers reveal their interests and buying preferences in real-time. The value chain becomes an interactive process. This challenges companies to integrate their physical-channel strategy with the Internet.   The opportunities provided by the Internet lie primarily in developing value-adding business relationships with suppliers, partners and customers.   The term “extended enterprise” is used to denote a company that collaborates with its suppliers, partners and customers to streamline business processes, transcending traditional boundaries and enhancing mutual benefits in terms of customer loyalty and retention, reduced procurement and inventory costs, fewer shortages, improved order management and fulfillment as well as faster time to market with more accurate offerings (products and services).   Customers care about their total experience with the manufacturer and the retailer. The experience is more persistent than the product. Therefore, manufacturers need to brand the customer experience. J.
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  • 16. 16 Real-Time Business Intelligence 3 J.
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  • 17. The Evolution of E-Business 17 E-business Business value E-commerce E-commerce dynamic content displayed to a wide number of customers and business partners buy, sell Interactivity email faq Web Presence ‘’brochureware’’ one-directional information flow Time J.
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  • 18. The Evolution of Analysis / Business Intelligence 18 predictive models are built to understand what will happen discovery Predictive Information real-time business trends are evaluated by personalization analyzing data to report what & distribution happened and why Business value verification Historical Information Time J.
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  • 19. The Convergence Between Business Intelligence and E-Business 19 delivering individualized, integrated intelligence to information consumers throughout the business value chain REAL-TIME PERSONALISATION BUSINESS VALUE E-BUSINESS & DISTRIBUTION CHAIN DATA MINING E-COMMERCE OLAP & STATISTICAL ANALYSIS INTERACTIVITY QUERY & REPORTING CONTENT WEB PRESENCE J.
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  • 20. Turning Data into Knowledge 20 The BI/reporting application has become a part of enterprise infrastructure, and more focused on information creation, management and delivery than heavy-duty analysis. The typical end-user is someone whose primary interface is a Web browser. And they are as likely to work outside of the organization as a customer or partner as they are to be an employee. J.
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  • 21. Major Trends in Business Intelligence 21 CURRENT STATE FUTURE STATE REACTIVE PROACTIVE historical orientation : what happened ? predictive, future orientation in addition to reactive TIME DELAYED REAL-TIME analysis happens after the fact using aggregated and analysis of detailed data while event is occurring in detailed data addition to time-delayed INTERNALLY FOCUSED INTERNAL + EXTERNAL FOCUS small number of power users analysis aimed at covering the extended enterprise STAND-ALONE & DISPARATE IN LINE, UNIFIED little integration with operational systems analysis systems closely coupled with operational systems J.
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  • 22. Major Trends in Business Intelligence con’d 22 J.
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  • 23. Major Trends in Business Intelligence con’d 23 It’s becoming more and more practical to connect CRM activities and customer insight information with upstream operations in the supply chain. That is, to seamlessly link the supply chain’s ‘generate demand’ activities with its ‘fulfill demand’ activities. This means sharing transaction data among partners to help keep inventories low. But at another level, it typically entails connecting frontline employees – those in the call centre, the sales force, etc. – with the right data in the supply chain. A frontline employee taking an order from a customer must have visibility to updated inventory and production data in order to provide accurate delivery information to customers asking about their orders. At the same time, network-enabled information sharing between supply chain partners, such as a retailer and a manufacturer, can provide partners with insights into the customer that can help guide product development and manufacturing. By combining the rich information, insights and relationship-building capabilities of CRM at the front end, and the ability to create real-time electronic links between ‘generate demand’ and ‘fulfill demand’ activities, the supply chain can become increasingly responsive. J.
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  • 24. Major Trends in Business Intelligence con’d 24 J.
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  • 25. Major Trends in Business Intelligence con’d 25 Source : SPSS Rapid ROI Online Seminar, february 2003 J.
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  • 26. Major Trends in Business Intelligence con’d 26 1. Segmentation / Profiling -  Descriptive analysis, e.g. decision trees -  Predictive analysis, e.g. logistic regression Operational Systems 2. model creation 3. evaluation Data Warehouse 4. offer optimization 5. deployment, e.g. call-center recommandations J.
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  • 27. Major Trends in Business Intelligence con’d 27 J.
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  • 28. Major Trends in Business Intelligence con’d 28 WEB presentation real-time personalization and distribution : . embedded predictive modeling : real-time recommandations Enterprise . performance measures (dashboards, scorecards) guide decision-making Information Portal analysis & modeling predictive modeling techniques enable value-added business analysis data mining data integration a common data model data warehousing operational data store transactions SCM CRM transaction-level data is gathered from multiple sources ERP J.
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  • 29. Major Trends in Business Intelligence con’d 29 REQUIREMENTS FOR THE REAL-TIME ENTERPRISE INTEGRATE ANALYZE ACT   integrate enterprise   identify and   implement results into and extra-enterprise evaluate operational systems siloed applications opportunities and   build competitive   data warehousing, risks advantage through challenge operational data   real-data data using real-time store analysis, data analytics mining enabling enterprise application predictive business process technology integration data analysis automation J.
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  • 30. Major Trends in Business Intelligence con’d 30 A data warehouse is typically maintained by batch jobs that take periodic snapshots of operational data and clean, transform and load the data into a warehouse solution. The latency gap inherent to extracted data sources disconnects users from the operational sources. Until real-time data is combined with historical information in the data warehouse, it lacks analytic context. Historical data is static-frozen in time. The value of integrating real-time data with historical data is that you can leverage the real-time ODS to achieve a consolidated up-to-the- second view of a customer. And only by processing the consolidated data against relevant historical data and business rules you gain the basis for meaningful and timely action. The synergy between real-time and historical data, coupled with real-time delivery of personalized knowledge is the crux of real-time analytics and the source of its business value. J.
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  • 31. Closed-Loop Analysis 31 achieve single view of customer across all touchpoints and systems personalize every customer interaction in real-time use analysis of customer information to drive interactions J.
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