Enterprise Resource Planning (ERP) software helps companies coordinate information across business areas like marketing, supply chain management, accounting, and human resources. ERP programs use a shared database and reporting tools to manage business processes from a company-wide perspective. Functional areas within a business, like marketing and accounting, are interdependent and require data sharing to operate efficiently. Business processes integrate functional areas and are collections of activities that create value for internal or external customers. ERP systems improve information sharing between functional areas and business processes.

1. Enterprise Resource Planning
Chapter ONE
Information Systems & ERP

2. Introduction
• Enterprise Resource Planning (ERP) programs: Core software used by
companies to coordinate information in every area of business
• Help manage companywide business processes
• Use common database and shared management reporting tools

6. •System:
A group of elements that are integrated with the
common purpose of achieving an objective.
• Types of System
1. w.r.t SIZE
a) Sub System
b) Super System
2. w.r.t NATURE
a) Physical System
b) Conceptual System
Information Systems

7. Types of System with respect to Size:
Sub System:
A system within a system.
Super System:
When a system is a part of a larger system, the larger
system is called as the Super System.
Information Systems

8. 0- System:
• Government
1- Super System:
• Government of Pakistan
2- Sub System:
-- Government of Punjab etc.
Information Systems

9. Types of System with respect to Nature:
• Physical System:
The business firm is a Physical System transforming input (raw
material) into output (finished goods or services).
• Conceptual System:
A system that uses conceptual resources (data & information)
to represent a Physical System.
Information Systems

10. 0- System:
• Business
1- Conceptual System:
• Rules and Regulations
• Standard Operating Procedures ( SOPs )
• Strategies
• Software Systems
2- Physical System:
-- The Whole Organization
Information Systems

11. •Data vs. Information
•Collection of raw facts & figures is called Data
• e.g. Marks of Students in Quiz # 1
•Information is Data shaped into meaningful form
•Processed form of Data is called Information
• Eg List of TOP 5 Students in Quiz # 1
Information Systems

12. Information Systems
Data and Information

13. •Information system:
• Any organized combination of people, hardware, software, communication
networks, and data resources that collects, transforms, and disseminates
information in an organization
• Information system: Three activities produce information organizations
need
• Input: Captures raw data from organization or external environment
• Processing: Converts raw data into meaningful form
• Output: Transfers processed information to people or activities that use it
• Feedback & Control Mechanism:
• Output returned to appropriate members of organization to help evaluate or
correct input stage
Information Systems

14. An information system contains
information about an organization
and its surrounding environment.
Three basic activities—input,
processing, and output—produce
the information organizations need.
Feedback is output returned to
appropriate people or activities in
the organization to evaluate and
refine the input. Environmental
actors, such as customers,
suppliers, competitors,
stockholders, and regulatory
agencies, interact with the
organization and its information
systems.
Functions of an Information System
Information Systems

15. The Dimensions of High Quality Information
•Complete–should cover all areas of the decision being
made.
•Correct–without any mistake/error - strive for 100%.
•Relevant–must belong to the problem at hand.
•In-Time–should be available for decision making before
a crisis situations develop or opportunities are lost.
Note: Information overload is having too much information.
Information Systems

16. E R P - M o d e l
Decision’s
effectiveness
is measured
INFORMATION
Complete
Correct
Relevant
In-Time
Finance
Information
System
Warehouse
Information
System
Production
Information
System
HR
Information
System
Marketing
Information
System
E R P
Manager
Managers
Make
Decisions
to
Solve
Problems

17. Definition
The study of information systems focusing on their
use in business and management.
The field that deals with impact of information systems used by managers and
employees in the firm regarding Decision Making in problem solving is called
Enterprise Resource Planning.
Enterprise Resource Planning

18. Fundamentals of Information Technology
Chapter TWO
Enterprise Resource Planning

19. Computer Hardware & Computer Memory
• The term ‘Hardware' refers to the physical components that you can
see and touch, such as the computer hard drive, mouse, and keyboard.
• Computer Memory is any physical device capable of storing
information temporarily like RAM (random access memory)(primary
memory), or permanently, like Hard Disk/USB etc.
• Types of Memory
• Primary memory is the main memory of the computer which can
be directly accessed by the central processing unit.
• Secondary memory refers to the external storage device which can
be used to store data or information permanently.

21. Input Devices
• An input device is a hardware used to send data to a computer.
An input device allows users to communicate and feed instructions
and data to computers for processing, display, storage and/or
transmission.
• Human-captured data refers to input captured by a person typing on
a keyboard, clicking a mouse, speaking into a microphone, or a similar
interaction.
• Machine-captured data is data captured by an electronic device.
• Point-of-sale terminals are scanners used in retail stores.

22. Output Devices
• An output device is any device used to send data from a computer to
another device or user. Examples include monitors, projectors,
speakers, headphones and printers.

23. Computer Software
• The term ‘Software' refers to the set of electronic program
instructions or data a computer processor reads in order to perform a
task or operation.
• Software can be categorized according to what it is designed to
accomplish. There are two main types of software:
systems software and application software.

24. Types of Software
• Systems software (also known as operating system software) includes
the programs that are dedicated to managing the computer itself,
such as Windows, file management utilities, and disk operating
system (or DOS).
• The operating system manages the computer hardware resources in
addition to applications and data.
• Application software, or simply applications enable the user to
complete tasks, such as creating documents, spreadsheets, databases
and publications, doing online research, sending email, designing
graphics, running businesses, and even playing games!
• Application software is specific to the task it is designed for and can
be as simple as a calculator application or as complex as a word
processing application.

25. Home Computing Security
• Viruses are small computer programs that replicate by inserting
themselves into computer resources such as programs or files.
• Antivirus software is a program that is designed to prevent, search
for, detect, and remove software viruses and other malicious and
infected software.
• Norton, MacAfee, Kaspersky etc. Keep virus definitions updated.

26. Networks
• A computer network is a set of computers connected together for
the purpose of sharing resources. The most common resource shared
today is connection to the Internet. Other shared resources can
include a printer or a file server. The Internet itself can be considered
a computer network.
• Network interface card (NIC) is used to attach a device to the
communications medium.

27. Types of Networks
• Local Area Network (LAN) is a computer network that
interconnects computers within a limited area such as a
residence, school, laboratory, university campus or office
building.
• Metropolitan Area Network (MAN) is a computer network
that interconnects computers and usually spans several
buildings in the same city or town.
• Wide Area Networks (WAN) are used to connect computers
and other devices when the distance exceeds the constraints
of LANs and MANs.
• Uses common carrier, public telephone system
• WANs have been replaced by the Internet.

28. Electronic Commerce
• Electronic Commerce (E-commerce) refers to a business transaction that
uses network access, computer-based systems, and a Web browser
interface.
• Business-to-consumer (B2C) refers to transactions between a business and
the final consumer of the product.
• Business-to-business (B2B) refers to transactions between businesses in
which neither one is the final consumer.
• Electronic Government (E-gov) refers to transactions between a
government agency and typically a citizen.

29. Electronic Commerce
• Main benefits to firms:
• Improved customer service before, during, and after the sale
• Improved relationships with suppliers and the financial
community
• Increased economic return on stockholder and owner
investments
• Main constraints to firms:
• High costs
• Security concerns
• Immature or unavailable software

30. The Next Step for E-Commerce
• M-Commerce (Mobile Commerce) is the buying and selling of goods
and services through wireless handheld devices such as smartphones
and tablets.
• As a form of e-commerce, m-commerce enables users to access
online shopping platforms without needing to use a desktop
computer.

31. Virtual Sales
• Virtual sales are those made by a firm that does not operate a physical
storefront.
• Customer can’t enter and purchase the product.
• Virtual Sales Challenges
• Provide necessary product information without overwhelming the customer.
• Communicating image files from the Web site to the customer’s computer can take time.
• Payment over the Internet has suffered bad press–credit card fraud.

32. Hybrid Sales
• Hybrid sales occur when firms have both a physical storefront and a Web site where
customers can purchase products.
• Brick-and-click operations
• Most firms had storefronts before sales over the Internet were possible.
• Both a physical storefront and the Internet are necessary to their business plans.
• Stores act as showcases for products.
• Customers enjoy convenience of shopping over the Web.
• B2C sales means less inventory at its store; more sales floor space.

33. Business Functions & Business Processes
Chapter THREE
Enterprise Resource Planning

34. Functional Areas and Business Processes
• To understand ERP, you must understand how a business works
• Functional areas of operation
• Business processes

35. Functional Areas of Operation
• Marketing and Sales (M/S)
• Supply Chain Management (SCM)
• Accounting and Finance (A/F)
• Human Resources (HR)
• Business functions: Activities specific to a functional area of
operation

36. Figure 1-1
Examples of
functional
areas of
operation and
their business
functions
Functional
Areas
of
Operation

37. Functional Areas of Operation (cont’d.)
• Functional areas are interdependent
• Each requires data from the others
• Better integration of functional areas leads to improvements in
communication, workflow, and success of company
• Information system (IS): Computers, people, procedures, and
software that store, organize, and deliver information

39. Business Processes
• Collection of activities that takes one or more kinds of input and
creates an output that is of value to customer
• Customer can be traditional external customer or internal customer
• Thinking in terms of business processes helps managers to look at
their organization from the customer’s perspective

40. Business Processes (cont’d.)
Figure 1-2 Sample business processes related to the sale of a
personal smartphone

41. Business Processes (cont’d.)
• Businesses must always consider customer’s viewpoint in any
transaction
• Successful customer interaction
• Customer (either internal or external) is not required to interact with each
business function involved in the process
• Successful business managers view business operations from the
perspective of a satisfied customer

42. Business Processes (cont’d.)
• Sharing data effectively and efficiently between and within functional
areas leads to more efficient business processes
• Integrated information systems: Systems in which functional areas
share data

43. Business Processes (cont’d.)
Figure 1-3 A process view of business

44. Business Processes (cont’d.)
• Businesses take inputs (resources) and transform these inputs into
goods and services for customers
• Inputs: Material, people, equipment
• Managing inputs and business processes effectively requires accurate
and up-to-date information

45. Functional Areas and Business Processes of a
Very Small Business
• Example: A fictitious coffee shop
• Examine business processes of the coffee shop
• See why coordination of functional areas helps achieve efficient and effective
business processes
• Look at how integration of the information system improves the business

46. Marketing and Sales
• Functions of Marketing and Sales
• Developing products
• Determining pricing
• Promoting products to customers
• Taking customers’ orders
• Helping create a sales forecast

47. Marketing and Sales (cont’d.)
• Marketing and Sales tasks for the coffee shop
• Formal recordkeeping not required
• Need to keep track of customers
• Product development can be done informally
• Good repeat customers allowed to charge purchases—up to a point
• Records must show how much each customer owes and his or her available credit

48. Supply Chain Management
• Functions within Supply Chain Management
• Making the coffee (manufacturing/production)
• Buying raw materials (purchasing)
• Production planning requires sales forecasts from
M/S functional area
• Sales forecasts: Analyses that attempt to predict the
future sales of a product

49. Supply Chain Management (cont’d.)
• Production plans used to develop requirements for raw materials and
packaging
• Raw materials: Bottled spring water, fresh lemons, artificial sweetener, raw
sugar
• Packaging: Cups, straws, napkins
• SCM and M/S must choose a recipe for each coffee product sold

50. Accounting and Finance
• Functions within Accounting and Finance
• Recording raw data about transactions (including sales), raw material
purchases, payroll, and receipt of cash from customers
• Raw data: Numbers collected from sales, manufacturing and other
operations, without any manipulation, calculation, or arrangement for
presentation

51. Accounting and Finance (cont’d.)
• Data from Accounting and Finance used by Marketing and Sales and
Supply Chain Management
• Sales records are important component of sales forecast
• Sales forecast is used in making staffing decisions and in production planning
• Records from accounts receivable used to monitor the overall credit-granting
policy of the coffee shop

52. Human Resources
• Functions of Human Resources
• Recruit, train, evaluate, and compensate employees
• HR uses sales forecasts developed by the individual departments to
plan personnel needs
• Systems integrated using ERP software provide the data sharing
necessary between functional areas

53. Functional Area Information Systems
Chapter FOUR
Enterprise Resource Planning

54. Functional Area Information Systems
• Potential inputs and outputs for each functional area described next
• Note the kinds of data needed by each area and how people use the
data
• Information systems maintain relationships between all functional
areas and processes

55. Marketing and Sales
• Needs information from all other functional areas
• Customers communicate orders to M/S in person or by telephone, e-
mail, fax, the Web, etc.
• M/S has a role in determining product prices
• Pricing might be determined based on a product’s unit cost, plus some
percentage markup
• Requires information from Accounting and Finance, and Supply Chain
Management data

56. Marketing
and Sales
(cont’d.)
Figure 1-4
The Marketing and
Sales functional area
exchanges data with
customers and with the
Human Resources,
Accounting and
Finance, and Supply
Chain Management
functional areas

57. Marketing and Sales (cont’d.)
• M/S needs to interact with Human Resources to exchange
information on hiring needs, legal requirements, etc.
• Inputs for M/S
• Customer data
• Order data
• Sales trend data
• Per-unit cost
• Company travel expense policy

58. Marketing and Sales (cont’d.)
• Outputs for M/S
• Sales strategies
• Product pricing
• Employment needs

59. Supply Chain Management
• Needs information from various functional areas
• Production plans based on information about product sales (actual
and projected) that comes from Marketing and Sales
• With accurate data about required production levels:
• Raw material and packaging can be ordered as needed
• Inventory levels can be kept low, saving money

60. Supply Chain Management (cont’d.)
• Supply Chain Management data and records can:
• Provide data needed by Accounting and Finance to determine how much of
each resource was used
• Support the M/S function by providing information about what has been
produced and shipped
• Supply Chain Management interacts in some ways with Human
Resources

61. Supply Chain
Management
(cont’d.)
Figure 1-5
The Supply Chain
Management
functional area
exchanges data with
suppliers and with the
Human Resources,
Marketing and Sales,
and Accounting and
Finance functional
areas

62. Supply Chain Management (cont’d.)
• Inputs for SCM
• Product sales data
• Production plans
• Inventory levels
• Layoff and recall company policy

63. Supply Chain Management (cont’d.)
• Outputs for SCM
• Raw material orders
• Packaging orders
• Resource expenditure data
• Production and inventory reports
• Hiring information

64. Accounting and Finance
• Needs information from all other functional areas
• A/F personnel:
• Record company’s transactions in the books of account
• Record accounts payable when raw materials are purchased and cash
outflows when they pay for materials
• Summarize transaction data to prepare reports about company’s financial
position and profitability

65. Accounting and Finance (cont’d.)
• People in other functional areas provide data to A/F
• M/S provides sales data
• SCM provides production and inventory data
• HR provides payroll and benefit expense data
• M/S personnel require data from A/F to evaluate customer credit

66. Accounting
and Finance
(cont’d.)
Figure 1-6
The Accounting and
Finance functional
area exchanges data
with customers and
with the Human
Resources, Marketing
and Sales, and
Supply Chain
Management
functional areas

67. Accounting and Finance (cont’d.)
• Inputs for A/F
• Payments from customers
• Accounts receivable data
• Accounts payable data
• Sales data
• Production and inventory data
• Payroll and expense data

68. Accounting and Finance (cont’d.)
• Outputs for A/F
• Payments to suppliers
• Financial reports
• Customer credit data

69. Human Resources
• HR needs information from the other departments
• Tasks related to employee hiring, benefits, training, and government
compliance are all responsibilities of HR
• HR needs accurate forecasts of personnel needs from all functional
units
• HR needs to know what skills are needed to perform a particular job
and how much the company can afford to pay employees

70. Human
Resources
(cont’d.)
Figure 1-7
The Human
Resources
functional area
exchanges data
with the Accounting
and Finance,
Marketing and
Sales, and Supply
Chain Management
functional areas

71. Human Resources (cont’d.)
• Observing governmental regulations in recruiting, training,
compensating, promoting, and terminating employees
• Inputs for HR
• Personnel forecasts
• Skills data

72. Human Resources (cont’d.)
• Outputs for HR
• Regulation compliance
• Employee training and certification
• Skills database
• Employee evaluation and compensation

73. Human Resources (cont’d.)
• Significant amount of data is maintained by and shared among the
functional areas
• Timeliness and accuracy of these data critical to each area’s success
and to company’s ability to make a profit and generate future growth
• ERP software allows all functional areas to share a common database
• Allows accurate, real-time information to be available

74. Business Information Value Chain &
Strategic Objectives of ERP
Chapter FIVE
Enterprise Resource Planning

75. •Business perspective on information systems:
• Information system is instrument for creating value
• Investments in information technology will result in
superior returns:
• Productivity increases
• Revenue increases
• Superior long-term strategic positioning

76. •Business information value chain
• Raw data acquired and transformed through stages that
add value to that information
• Value of information system is determined by extent to
which it leads to better decisions, greater efficiency, and
higher profits

77. The Business Information Value Chain

78. From a business perspective, information
systems are part of a series of value-
adding activities for acquiring,
transforming, and distributing
information that managers can use to
improve decision making, enhance
organizational performance, and,
ultimately, increase firm profitability.
The Business Information Value Chain

79. •Investing in information technology does not
guarantee good returns
•Considerable variation in the returns firms
receive from systems investments
•Factors:
• Adopting the right business model
• Investing in complementary assets (organizational
and management capital)

80. •Complementary assets:
• Assets required to derive value from a primary
investment
• Firms supporting technology investments with
investment in complementary assets receive
superior returns
• E.g.: invest in technology and the people to make
it work properly

81. • Complementary assets include:
• Organizational investments, e.g.
• Appropriate business model
• Efficient business processes
• Managerial investments, e.g.
• Incentives for management innovation
• Teamwork and collaborative work environments
• Social investments, e.g.
• The Internet and telecommunications infrastructure
• Technology standards

82. In a sociotechnical perspective, the performance of a system is optimized when both the
technology and the organization mutually adjust to one another until a satisfactory fit is obtained.
A Socio-technical Perspective on Information Systems

83. 6 Strategic Business Objectives of ERP
• Business firms invest heavily in information systems to
achieve six strategic business objectives:
1) Operational excellence
2) New products, services, and business models
3) Customer and supplier intimacy
4) Improved decision making
5) Competitive advantage
6) Survival

84. 1) Operational Excellence
• Improvement of efficiency to attain higher
profitability
• Information systems technology serve as an
important tool in achieving greater efficiency
and productivity

85. 2) New products, services, and business
models
• Business model: describes how company
produces, delivers, and sells product or
service to create wealth
• Information systems and technology are
major enabling tools for creation of new
products, services, business models

86. 3) Customer and supplier intimacy
• Serving customers well leads to customers
returning, which raises revenues and profits
• E.g. High-end hotels that use computers to track
customer preferences and use to monitor and
customize environment
• Intimacy with suppliers allows them to provide
vital inputs, which lowers costs

87. 4) Improved decision-making
• Without accurate information:
• Managers must use forecasts, best guesses, luck
• Leads to:
• Overproduction, underproduction of goods and services
• Misallocation of resources
• Poor response times
• Poor outcomes raise costs, lose customers
• E.g. World Call Pakistan failed to provide
managers with real-time data on customer
complaints, network performance, line outages,
etc.

88. 5) Competitive advantage
• Delivering better performance
• Charging less for superior products
• Responding to customers and suppliers in real time
• E.g. Dell: Consistent profitability over 25 years; Dell
remains one of the most efficient producer of PCs in
world.
• But Dell has lost some of its advantages to fast followers-
- HP

89. 6) Survival
• Information technologies as necessity of business
• May be:
• Industry-level changes, e.g. Citibank’s introduction of ATMs
• Governmental regulations requiring electronic record-keeping
• E.g. NADRA

90. The Interdependence Between Organizations and Information Technology
There is a growing
interdependence
between a firm’s
information systems
and its business
capabilities. Changes
in strategy, rules, and
business processes
increasingly require
changes in hardware,
software, databases,
and
telecommunications.
Often, what the
organization would like
to do depends on what
its systems will permit
it to do.

91. General System Model of the Firm &
Supply Chain Management
Chapter SIX
Enterprise Resource Planning

92. The General System Model of the Firm

93. The General Systems Model of the Firm
• Physical resource flow includes personnel, material,
machines, and money.
• Virtual resource flow includes data, information, and
information in the form of decisions.

94. The General Systems Model of the Firm
• Firm’s control mechanism include
• Performance standards to meet if the firm wants to achieve
overall objectives.
• Firm’s management.
• Information processor that transform data into
information.
• Feedback loop is composed of the virtual resources.

95. The Firm in Its Environment
• Environmental elements are organizations and
individuals that exist outside the firm and have a
direct or indirect influence on it.
• Such as suppliers, customers, labor unions, financial
community, stockholders and owners, competitors, and
governments.
• Global community is the geographic area where the
firm performs its operations.

96. Eight Environmental Elements

97. Managing the Physical Resource Flows–
Supply Chain Management
• Supply chain is the pathway that facilitates the flow
of physical resources from suppliers to the firm and
then to customers.
• Supply chain management manages the resources
through the supply chain to ensure timely and
efficient flow.

98. Supply Chain Management Activities
• Forecasting customer demand
• Scheduling production
• Establishing transportation networks
• Ordering replenishment stock from suppliers
• Receiving stock from suppliers

99. Supply Chain Management Activities (Cont’d)
• Managing inventory–raw materials, work-in-process,
and finished goods
• Executing production
• Transporting resources to customers
• Tracking the flow of resources from suppliers, through
the firm, and to customers

100. Supply Chain Management
• Firm’s information systems can be used to perform
the supply chain activities.
• Electronic systems provide the ability to track the flow
of the resources as it occurs.
• Is a crucial aspect of a firm’s ERP system.

101. Competitive Advantage
• Competitive advantage refers to the use of information to gain
leverage in the marketplace.
• Uses virtual as well as physical resources.
• Is used to meet the strategic objectives of the firm.

102. Porter’s Value Chain Model &
System Development Life Cycle
Chapter SEVEN
Enterprise Resource Planning

103. Porter’s Value Chains
• Value chain is created to achieve competitive advantage.
• Consists of the primary and support activities that contribute to margin.
• Margin is the value of the firm’s products and services minus their
costs, as perceived by the firm’s customers.
• Increased margin is the objective of the value chain.

104. Porter’s Value Chain Model

105. Porter’s Value Activities
• Primary value activities manage the flow of physical resources
through the firm.
• Support value activities include the firm’s infrastructure.
• Each value activity includes purchased inputs, human resources, and
technology.

106. Expanding the Scope of the Value Chain
• Interorganizational system (IOS) is the linking of the
firm’s value chain to those of other organizations.
• Business partners are the participating firms in the
IOS.
• Value system is the linking of the firm’s value chain
with those of its distribution channel members.

107. The Systems Approach
• John Dewey identified three series of judgments involved in
adequately resolving a controversy:
• Recognize the controversy.
• Weigh alternative claims.
• Form a judgment.
• During the late 1960s/early 1970s, interest in systematic problem
solving strengthened.
• Systems approach—a series of problem-solving steps that ensure the
problem is first understood, alternative solutions are considered, and
the selected solution works.

108. Phases and Steps of Systems Approach

109. Each Business Area Is a System

110. Each Part of the System Is Analyzed in Sequence

111. Systems Development Life Cycle
• Methodology is a recommended way of doing
something.
• Systems development life cycle (SDLC) is an
application of the systems approach to the
development of an information system.
• Traditional SDLC stages are:
• Planning
• Analysis
• Design
• Implementation
• Use

112. The Circular Pattern of the System Life Cycle

113. A Context Diagram of a Sales Commission System

114. A DFD of a Sales Commission System

115. Process Modelling, Process Improvement
and ERP Implementation
Chapter EIGHT
Enterprise Resource Planning

116. Introduction
• Tools that can be used to describe business processes
• Flowcharts, event process chains
• Not specific to ERP
• Can help managers identify process elements that can be improved
• Role of process-modeling tools in ERP implementation projects

117. Process Modeling
• Business processes can be quite complex
• Process model: any abstract representation of a process
• Process-modeling tools provide a way to describe a business process
so that all participants can understand the process

118. Process Modeling (cont’d.)
• Advantages of process models
• Graphical representations are usually easier to understand than written
descriptions
• Provide a good starting point for analyzing a process
• Participants can design and implement improvements
• Document the business process
• Easier to train employees to support the business process

119. Flowcharting Process Models
• Flowchart
• Any graphical representation of the movement or flow of concrete or abstract
items
• Clear, graphical representation of a process from beginning to end
• Uses a standardized set of symbols
• Process mapping
• Often used interchangeably with flowcharting
• Specifically refers to activities occurring within an existing business process

120. Flowcharting Process Models (cont’d.)
Figure 7-1 Basic flowcharting symbols

121. Fitter Snacker Expense Report Process
• Maria, Fitter Snacker salesperson
• Completes a paper expense report after travel
• Makes a copy for her records
• Attaches receipts for any expenses over $25
• Mails it to her zone manager at the branch office
• Kevin, zone manager
• Reviews expense report
• Approves report or mails it back to Maria asking for explanation, verification,
or modification
• After approval, mails it to corporate office

122. Figure 7-2 Partial process
map for Fitter Snacker
expense-reporting process

123. Fitter Snacker Expense Report Process
(cont’d.)
• Process at corporate office
• Accounts payable (A/P) clerk
• Process boundaries define:
• Which activities are to be included in the process
• Which activities are considered part of environment—external to process
• All processes should have only one beginning point and one ending
point
• Decision diamond asks a question that can be answered with “yes” or
“no”

124. Extensions of Process Mapping
• Hierarchical modeling: ability to flexibly describe a business process
in greater or less detail, depending on the task at hand
• Modeling software that supports hierarchical modeling
• Provides user the flexibility to move easily from higher-level, less detailed
views to the lower-level, more detailed views

125. Figure 7-3 Hierarchical modeling of Fitter’s expense-reporting process

126. Extensions of Process Mapping (cont’d.)
• Deployment flowcharting
• Swimlane flowchart
• Depicts team members across the top
• Each step is aligned vertically under the appropriate employee or team
• Clearly identifies each person’s tasks in the process

127. Figure 7-4 Deployment, or swimlane, flowcharting of the Fitter’s expense report process

128. Process Improvement
• Value analysis
• Each activity in the process is analyzed for the value it adds to the product or
service
• Value added is determined from the perspective of customer
• Real value: value for which the customer is willing to pay
• Business value: value that helps the company run its business
• No value: an activity that should be eliminated

129. Evaluating Process Improvement
• Disrupting the current process to make changes can be costly and
time consuming
• Dynamic process modeling takes a basic process flowchart and puts it
into motion
• Uses computer simulation techniques to facilitate the evaluation of proposed
process changes
• Computer simulation
• Uses repeated generation of random variables that interact with a logical
model of the process
• Predict performance of the actual system

130. RFID, Business Intelligence,
Mobile Computing & The Cloud
Chapter NINE
Enterprise Resource Planning

131. Introduction
• An Enterprise Resource Planning (ERP) system allows a company to
accomplish tasks that cannot be done well, if at all, without such a
system
• Traditionally:
• ERP systems have been software applications that are run on a company’s
own computer systems
• Focus of ERP has been on managing business transactions

132. Introduction (cont’d.)
• Technologies, such as radio frequency identification (RFID), are
increasing the amount of data that is contained in ERP systems
• Business intelligence technologies are turning data in ERP systems
into valuable information
• Cloud computing and mobile technologies are changing where ERP
data is stored and how it is delivered

133. Radio Frequency Identification (RFID)
Technology
• Radio frequency identification technology
• Known commonly as RFID
• Becoming an increasingly efficient tool for tracking items through a supply
chain
• RFID device
• Can be attached to products
• A small package (or tag) made up of a microprocessor and an antenna

134. Radio Frequency Identification (RFID)
Technology (cont’d.)
• RFID reader
• Can determine location of an item with an RFID tag
• Emits radio waves and receives signals back from the tag
• Sometimes called an interrogator
• Advantages of RFID technology:
• Does not need a line-of-sight connection
• Can withstand most environmental stresses

135. Radio Frequency Identification (RFID)
Technology (cont’d.)
• Walmart is on the leading edge of the move to integrate RFID
technology into the supply chain
• Pharmaceutical firms are evaluating the use of RFID technology
• RFID technology is being employed to track medical devices
• Spectrum Health’s Meijer Heart Center is using RFID technology to track
stents

136. Business Intelligence/Business Analytics
• Business intelligence (BI)
• Also referred to as business analytics
• A range of different applications and technologies used to extract and analyze
large amounts of data to aid in decision making
• Includes data-mining tools and querying tools
• Often interactive and visual
• There has been significant growth in the BI market in recent years

137. Figure 8-1 SAP Business Intelligence (BI) framework

138. Business Intelligence/Business Analytics
(cont’d.)
• Analytic applications and business intelligence
• Similar sets of data analysis tools
• Analytic applications
• Data analysis tools applied to specific industries
• Enterprise performance management
• Concept of developing strategic goals for the organization
• Gathering data to evaluate how the organization is performing in relation to
those goals

139. Business Intelligence/Business Analytics
(cont’d.)
• Governance, risk, and compliance category
• A group of activities focused on ensuring an organization is functioning
ethically and legally
• Data warehousing
• Technology used to store the large volumes of data used in the analysis
• Enterprise information management
• Describes the business and technology functions that manage information as
a corporate asset

140. Mobile Computing
• Increasing use of smartphones, tablet computers, and other mobile
computing devices
• Mobile applications need to be developed for different kinds of
smartphones, with different operating systems
• Companies need to make many decisions about the use of mobile
devices by employees
• Mobile devices provide users with information and can also be
sources of information

141. From Internet-Enabled to Cloud Computing
• Cloud computing
• Delivery of a software product to a user via the Internet
• The user typically accesses the cloud product through a Web browser or a
lightweight (meaning small and simple) application for a computer or mobile
device
• Cloud computing is not a completely new concept
• It represents the latest stage of the development of computing and the
Internet

142. Transaction Processing System &
The Distribution System DFDs
Chapter TEN
Enterprise Resource Planning

143. Transaction processing system (TPS)
• Transaction processing system (TPS) is the information system that
gathers data describing the firm’s activities, transforms the data into
information, and makes the information available to users both inside
and outside the firm.

144. Model of a Transaction Processing System

145. A Context Diagram of Distribution System

146. Figure 0 Diagram of the Distribution System

147. Major Subsystems of Distribution System
• Systems that fill customer orders.
• Order entry system enters customer orders into the system.
• Inventory system maintains the inventory records.
• Billing system prepares the customer invoices.
• Accounts receivable system collects the money from the customers.
• Systems that order replenishment stock.
• Purchasing system issues purchase orders to suppliers for needed stock.
• Receiving system receives the stock.
• Accounts payable system makes payments.

148. Figure 1 Diagram of the System that Fills Customers Orders

149. Figure 2 Diagram of Systems That Order Replenishment Stock

150. Major Subsystems of Distribution System (Cont’d)
• Systems that perform general ledger processes.
• General ledger system is the accounting system that combines data from
other accounting systems for the purpose of presenting a composite financial
picture of the firm’s operations.
• General ledger is the file that contains the combined accounting data.
• Updated general ledger system posts records that describe various actions
and transactions to the general ledger.
• Prepare management reports system uses the contents of the general ledger
to prepare the balance sheet, income statement, and other reports.

151. Figure 3 Diagram of the Systems that Perform General Ledger Processes

152. Introduction to Databases &
MS Access
Chapter ELEVEN
Enterprise Resource Planning

153. What is a database
A database is any organized collection of data. Some examples of
databases you may encounter in your daily life are:
• a telephone book
• T.V. Guide
• airline reservation system
• motor vehicle registration records
• papers in your filing cabinet
• files on your computer hard drive.

154. Data vs. information:
What is the difference?
•What is data?
• Data can be defined in many
ways. Information science
defines data as unprocessed
information.
• What is information?
• Information is data that have
been organized and
communicated in a coherent
and meaningful manner.
• Data is converted into
information, and information
is converted into knowledge.
• Knowledge; information
evaluated and organized so
that it can be used
purposefully.

155. Why do we need a database?
• Keep records of our:
• Clients
• Staff
• Volunteers
• To keep a record of activities and
interventions;
• Keep sales records;
• Develop reports;
• Perform research
• Longitudinal tracking

156. What is the ultimate purpose of a
database management system?
Data Information Knowledge Action
Is to transform

157. More about database definition
What is a database?
Quite simply, it’s an organized collection of data. A database
management system (DBMS) such as Access, FileMaker, Lotus Notes,
Oracle or SQL Server which provides you with the software tools you
need to organize that data in a flexible manner. It includes tools to
add, modify or delete data from the database, ask questions (or
queries) about the data stored in the database and produce reports
summarizing selected contents.

158. Some Definitions
• A File: A group or collection of similar records, like INST6031 Fall Student
File, American History 1850-1866 file, Basic Food Group Nutrition File
• A record book: a "rolodex" of data records, like address lists, inventory lists,
classes or thematic units, or groupings of other unique records that are
combined into one list (found in AppleWorks, FileMaker Pro software).
• A field: one category of information, i.e., Name, Address, Semester Grade,
Academic topic
• A record: one piece of data, i.e., one student's information, a recipe, a test
question
• A layout: a design for a database that contains field names and possibly
graphics.

159. Table
• “A table is the primary unit of physical storage for data in a
database.”1
• Usually a database contains more than one table.

160. Table

161. A Database with Multiple Tables
Publishers Books Customers
Authors Inventory Orders
[1]

162. Table
Customers

163. Field (Column)
a field
Customers

164. Record (Row)
a record
Customers

165. Primary Key
primary key field
Customers
Primary key is a unique identifier of records in a table.
Primary key values may be generated manually or automatically.

166. Foreign Key
foreign key field
primary key field
parent table
Directors
Movies
child table
relationship

167. Data Types
• Alphanumeric (Text, Memo)
• Numeric (Number, Currency, etc.)
• Date/Time
• Boolean (Yes/No)

168. Example (Final Tables)
• Table: SalesOrders
• SalesOrderNo
• Date
• CustomerNo
• ClerkNo
• Total
• Table: OrderItems
• SalesOrderNo
• ItemNo
• ItemQuantity
• ItemUnitPrice
• Table: InventoryItems
• ItemNo
• ItemDescription
• Table: Customers
• CustomerNo
• CustomerName
• CustomerAddress
• Table: Clerks
• ClerkNo
• ClerkName

169. Development of an Information System
( Final Project )