BUSINESS DRIVEN TECHNOLOGY

Chapter Twelve: Integrating the Organization

from End to End – Enterprise Resource Planning

LEARNING OUTCOMES

12.1 Describe the role information plays in enterprise resource planning systems

12.2 Identify the primary forces driving the explosive growth of enterprise resource planning systems

12.3 Explain the business value of integrating supply chain management, customer relationship management, and enterprise resource planning systems

CHAPTER TWELEVE OVERVIEW

• Enterprise resource planning systems serve as the organization's backbone in providing fundamental decision-making support

• This chapter discusses– ERP’s explosive growth– Using ERP to connect corporations– Integrating SCM, CRM, and ERP

CHAPTER TWELEVE OVERVIEW

• At the heart of all ERP systems is a database, when a user enters or updates information in one module, it is immediately and automatically updated throughout the entire system

CHAPTER TWELEVE OVERVIEW

• ERP systems can automate business processes

CHAPTER TWELEVE OVERVIEW

• ERP systems must integrate various organization processes and be:– Flexible

• to changing needs of enterprise– Modular and open system architecture

• Interfaced with and detached whenever is required• Support multiple hardware platform

– Comprehensive • to support a variety of organizational functions and wide

range of organization– Beyond the company

• On line connectivity to customers or business partners

ENTERPRISE RESOURCE PLANNING’S EXPLOSIVE GROWTH

• SAP boasts 20,000 installations and 10 million users worldwide

• ERP solutions are growing because:– ERP is a logical solution to the mess of incompatible

applications that had sprung up in most businesses– ERP addresses the need for global information sharing

and reporting– ERP is used to avoid the pain and expense of fixing

legacy systems

THE CONNECTED CORPORATION

• Top three ERP vendors and their major components

THE CONNECTED CORPORATION

• SCM, CRM, and ERP are the backbone of e-business

• Integration of these applications is the key to success for many companies

• Integration allows the unlocking of information to make it available to any user, anywhere, anytime

THE CONNECTED CORPORATION

• SCM and CRM market overviews

INTEGRATING SCM, CRM, AND ERP

• Many companies purchase modules from an ERP vendor, an SCM vendor, and a CRM vendor and must integrate the different modules together– Middleware – several different types of software which sit in the

middle of and provide connectivity between two or more software applications

– Enterprise application integration (EAI) middleware – represents a new approach to middleware by packaging together commonly used functionality, such as providing prebuilt links to popular enterprise applications, which reduced the time necessary to develop solutions that integrate applications from multiple vendors

INTEGRATING SCM, CRM, AND ERP

• General audience and purpose of SCM, CRM and ERP

INTEGRATING SCM, CRM, AND ERP

• Data points where SCM, CRM, and ERP integrate

Opening Case Study QuestionsRevving Up Sales at Harley-Davidson

1. Explain how an ERP system can help Harley-Davidson gain business intelligence in its operations

2. Assess the business benefit for Harley-Davidson in integrating its CRM, SCM, and ERP systems

CHAPTER TWELEVE CASEHilton Purchases New Suite

• Hilton deployed a new ERP that cost $4 million

• The ERP system has increased processing efficiency by a factor of six

• The ERP system is saving the company between $4.5 and $5 million annually

CHAPTER TWELEVE CASE QUESTIONS

1. Summarize why the merger of two separate corporations can cause significant issues for the integration of information

2. Which component would you recommend if Hilton wanted to add an additional PeopleSoft component? Evaluate the business benefit of this additional component

3. Analyze why it is critical for an organization like Hilton Hotels to have an enterprisewide system

4. Assess the benefits Hilton Hotels Corporation could receive from implementing an integrated SCM, CRM, and ERP solution

BUSINESS DRIVEN TECHNOLOGY

UNIT THREE CLOSING

Unit Closing Case One Building LEGO’s IT Systems One Block at a Time

1. Summarize why LEGO’s managers and executives would want to use DSSs and EISs to gain business intelligence

2. Prototype a potential digital dashboard for a sales executive at LEGO

3. Describe a supply chain and explain why managing it is important to LEGO’s business

Unit Closing Case One Building LEGO’s IT Systems One Block at a Time

4. Summarize customer relationship management and explain how LEGO could use CRM to enhance its business

5. Is it ethical for an employee at LEGO to sell the organizational information stored in its i2 system?

6. One of the challenges facing LEGO is its ability to forecast demand. Explain how implementing the ERP solution from i2 has helped the company improve its demand forecasting

Unit Closing Case TwoeBay’s Cosmos Business Intelligence System

1. Explain why eBay’s managers and executives decided to create the Business Intelligence Team

2. Define five types of information that eBay executives might want on their EISs

3. Determine the strategy eBay is taking regarding its supply chain

4. Assess the business benefits from implementing an analytical CRM solution at eBay

Unit Closing Case TwoeBay’s Cosmos Business Intelligence System

5. Which component would you recommend eBay purchase if the company was interested in adding an additional ERP component?

6. One of the key success factors of Cosmos is its ability to provide a better understanding of customer activity, which allows eBay to improve customer experiences making eBay a safer place to buy/sell practically anything. Explain why eBay’s unique business structure causes safety and security concerns for its customers

7. What types of security issues should eBay be concerned with and what can it do to protect itself?