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Electronic Business Systems

Dr Mohammad Nabil Almunawar

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Learning Objectives

Identify cross-functional E-Business systems and give examples of how they can provide significant business value to a company and its customers and business partners.

Give examples of how Internet and other information technologies support business processes within the business functions of accounting, finance, human resource management, marketing, and production and operations management.

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E-Business

E-business is the use of computer networks and IT to support business (transactions, communication and collaboration, business process).

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The E-Business Application Architecture

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Enterprise Resource Planning (ERP)

ERP is a cross-functional enterprise system that serve as a framework to integrate and automate of many business process.

ERP is a backbone of E-Business. ERP software is a family of office process. For example,

ERP for a manufacturing company will typically track the status of sales, inventory, shipping, invoicing forecast raw material, etc.

ERP is recognized as a necessary ingredient for the efficiency, agility, and responsiveness to customers and suppliers in the competitive environment.

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Business Value of ERP ERP creates a framework for integrating and improving

back-office systems that results in major improvement in customer service, production and distribution efficiency.

ERP provides vital cross-functional information quickly on business performance to managers to significantly improve their ability to make better business decisions across the enterprise.

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Customer Relationship Management (CRM)

It costs 6 times more to sell to a new customer than to sell to the existing one.

A typical dissatisfied customer will tell to 10 people about his/her experience.

A company can boost its profits 85% by increasing its annual customer retention by only 5%.

The odds of selling a product to a new customer are 15%, whereas the odds of selling a product to an existing customer are 15%.

70% of complaining customers will do business with the company again if it quickly takes case of a service snafu.

More than 90% of existing companies don’t have the necessary sales service integration to support E-commerce.

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CRM

CRM uses IT to create a cross-functional enterprise system that integrate and automate many customer serving process in sale, marketing, and product services.

CRM software provides tools that enable a business and its employees to provide fast, convenient, dependable, and consistent service to customers.

A typical CRM software includes sales, direct marketing and fulfillment and customer service & support.

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Major application clusters in CRM

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Business Value of CRM

Allows business to identify and target their best customer

Enables real-time customisation and personalisation of products and services.

Keeps track when customers contact the company regardless of the contact point.

Enable company to provide consistent customer experience and superior service and support all contact points a customer chooses.

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Cross-Functional Integrated Systems

Front OfficeApplications

CRM Application•Customer Service•Field Service•Sales Order•Product Config

Back OfficeApplications

ERP Application•Distribution•Manufacturing•Scheduling•Finance

EnterpriseApplicationIntegration

Enterprise ApplicationCluster

Enterprise ApplicationCluster

Cu

sto

mer

s

Suppliers

Bu

sin

ess

Par

tner

s

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Supply Chain Management

Commit

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Online Transaction Processing

Transactions are events that occur as part of doing business such as sales, purchases, deposits, withdrawals, refunds, and payments.

Transaction processing are cross functional information systems that process data resulting from the occurrence of business transactions.

Online transaction processing systems play strategic role in e-commerce.

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Example of an online transaction system

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Transaction Processing Cycle

DatabaseMaintenance

TransactionProcessing

• Batch•Online/Realtime

TransactionProcessing

• Batch•Online/Realtime

DataEntry

Documentand ReportGeneration

InquiryProcessing

1 2

3

4

5

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Functional Business Information Systems

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Marketing Information Systems

MarketingInformation

Systems

MarketingInformation

Systems

InteractiveMarketing

Sales ForceAutomation

Sales ForceAutomation

CustomerRelationshipManagement

CustomerRelationshipManagement

SalesManagement

SalesManagement

MarketResearch andForecasting

MarketResearch andForecasting

Advertisingand

Promotions

Advertisingand

Promotions

ProductManagement

ProductManagement

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Major Components of Targeted Marketing

Online Behavior

Community

Context

Demographic/Psychographic

Content

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Manufacturing Information Systems

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Human Resource Management

•Manpower Planning•Labor Force Tracking

•Labor Cost Analysis•Turnover Analysis

•Recruitment•Workforce Planning

•Skill assessment•Performanceevaluation

•Payroll control•Benefits Administration

•Compensation effectiveness•Benefits Analysis

•Contract costing•Salary forecast

•Succession planning•Performance appraisal plans

•Training effectiveness•Career matching

StaffingTraining &

Development CompensationAdministration

StrategicSystems

TacticalSystems

OperationalSystems

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Accounting Information Systems

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Financial Information Systems

Financial Information

Systems

Financial Information

Systems

FinancialPlanning

FinancialPlanning

CashManagement

InvestmentManagement

InvestmentManagement

CapitalBudgeting

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Summary The E-Business Application Architecture reflects the key

E-Business applications and their interrelationships. Cross-functional enterprise applications cross the

boundaries of traditional business functions. These systems focus on supporting integrated clusters of business processes.

Supply Chain Management relies on information technology and management practices to optimize information and product flows among the processes and business partners within the supply chain.

A transaction processing system is an information system that processes data resulting from the occurrence of business transactions.

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Summary (cont) Traditional functional business systems support specific

business functions including marketing, accounting, finance, production/operations, and human resource management.

Marketing information systems support traditional and E-commerce processes and management of the marketing function.

Computer-based manufacturing systems help a company simplify, automate, and integrate many of the activities needed to quickly produce high-quality products to meet changing customer demands.

Human resource information systems support human resource management in organizations.

Several different types of electronic payment systems are used to support E-Commerce transactions.