Chapter Four

Intro to Information Technology

Wednesday, Nov 13th

Final Exam: Dec 11th 7pm – 9pm

Chapter Four – Electronic Business Systems

Chapter Five – Electronic Commerce Systems

E-business Application Architecture

E-business Application Architecture This diagram illustrates the

application components, interrelationships, and interfaces with customers employees business partners other stakeholders in the E-business

enterprise

E-business Application Architecture It gives a good overview of

interrelatedness Interdependence Integration

Of the E-Business applications that are vital components of the successful operations and management of an E-business enterprise

Cross Functional Systems Cross Functional Business System

These systems support business processes such as product development, production, distribution, order management, customer support, etc

Cross Functional Enterprise System Cross the boundaries of traditional business

functions Reengineer and improve vital business

processes all across the enterprise

Cross Functional Systems Organizations view cross functional

enterprise systems as strategic way to use IT to Share information resources Improve efficiency and effectiveness

of business processes Help business attain strategic

objectives

Enterprise Resource Planning ERP is a cross functional enterprise

system that serves as a framework to integrate and automate many of the business processes within Manufacturing Logistics Distribution Finance Accounting Human Resources

Enterprise Resource Planning ERP software is a family of software

that supports the business activities involved in back office processes

Example: ERP software for a manufacturing company will typically Track status of sales, inventory,

shipping, and invoices Forecast raw material and human

resource materials

Enterprise Resource Planning Companies began to implement ERP as

a vital conceptual foundation for re-engineering their business processes, and as the software engine required to accomplish these new cross functional processes

Now ERP is a necessary part of an E-business enterprise that requires efficiency, agility, and responsiveness

Enterprise Resource Planning Companies are finding business value in

two major ways ERP creates a framework for integrating and

improving their back office systems that results in major improvements 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

Customer Relationship Management

It costs six times more to sell to a new customer than to an existing one

A typical dissatisfied customer will tell eight to ten people about their experience

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

The odds of selling a product to a new customer are 15%; an existing customer 50%


Businesses are turning to customer relationship management as a major customer-centric business strategy

CRM uses info technology to create a cross functional enterprise system that integrates and automates many of the customer serving processes in sales, marketing and product services that interact with a company’s customers


Create an IT framework that integrates all of these processes with the rest of a company’s business processes

Consist of a family of software modules that perform the business activities

Provides tools that enable a business and its employees to provide fast, convenient, dependable, and consistent service to its customers


CRM systems typically include Sales

Track customer contacts and other business and life cycle events of customers

Direct Marketing and Fulfillment Automate tasks such as qualifying leads,

managing responses, scheduling sales contacts, and providing information to prospects and customers


CRM systems typically include continued… Customer Service and Support

Helps customer service managers quickly create, assign, and manage service requests

Help desk software assists customer service reps in helping customers who are having problems by providing relevant service data and suggestions for resolving problems


Business benefits of CRM Systems Ability to identify and target best

customers Allows real-time customization and

personalization of products and services based on customer wants, needs, buying habits, and life cycles

Keeps track of when a customer contacts the company regardless of contact point


SalesCross-SellUp-SellTeleSales

Store Frontand FieldService

Marketing andFulfillment

CustomerService andSupport

Retentionand LoyaltyPrograms

Customer

Contact Management


Business benefits of CRM Systems continued… Enables the company to provide

consistent customer experience and superior service and support across all contact points

These benefits provide strategic business value to a company and major customer value to its customers

Enterprise Application Integration Interconnects several E-business

application clusters Enables users to model the business

processes involved in the interactions that should occur between business applications

EAI software can integrate a variety of enterprise application clusters by letting them exchange data according to business process rules

Enterprise Application Integration EAI software can integrate the front and back

office applications of an e-business so they work together in a seamless integrated way

This is a vital capability that provides real business value to an e-business enterprise that must respond quickly and effectively to business events and customer requests

Integrates access to all customer and product data customer reps need to access quickly

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

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Suppliers

Bu

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Par

tner

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Supply Chain Management E-Commerce customer value

imperative What the customer wants, when and

where its wanted, at the lowest possible cost

Supply chain The interrelationships with other

businesses needed to build and sell a product, the network of business relationships

Supply Chain Management SCM Software

Significantly reduce costs, increase efficiency, and improve supply chain cycle time

Help improve inter-enterprise coordination among supply chain process players for more effective distribution and and channel networks among business partners

Schedule Make Deliver

Transportation

Planning

DemandPlanningDemandPlanning

OrderCommitment

OrderCommitment

AdvanceScheduling

AdvanceScheduling

ManufacturingPlanning

ManufacturingPlanning

DistributionPlanning

DistributionPlanning

Internetworked Supply Chain ManagementInternetworked Supply Chain Management

SupplyChainLife Cycle

SCMFunctionalProcesses

SCMIntegratedSolution

Online Transaction Processing Transaction processing systems

Cross functional info systems that process data resulting from the occurrence of business transactions

Transactions Events that occur as a part of doing

business, such as sales, purchases, deposits, withdrawals, refunds, and payments

Online Transaction Processing Transaction processing activities are

needed to capture and process data involved in transactions

Online transaction processing systems Real-time systems that capture and

process transactions immediately Can help provide superior service to

customers and other trading partners

Online Transaction Processing Transaction Processing Cycle

Data Entry Capture of business data

Transaction processing Batch processing is where data is collected

and processed periodically over time Real-time processing is where data is

processed immediately after a transaction occurs

All OTP systems use real-time processing


continued.. Database maintenance

Databases must always be correct and up-to-date

Transaction processing systems update corporate databases to reflect changes made in day-to-day processing


continued.. Document and Report Generation

Purchase orders Pay cheques Sales receipts Invoices Customer statements


continued.. Inquiry processing

Make inquiries and receive responses concerning the results of transaction processing activities

Check on status of an order Get account balances Amount of stock in inventory

DatabaseMaintenance

TransactionProcessing• Batch

•Online/Realtime

TransactionProcessing• Batch

•Online/Realtime

DataEntry

Documentand ReportGeneration

InquiryProcessing

1 2

3

4

5

Functional E-Business Systems Systems that support the business

functions of Accounting Finance Marketing Operations management Human resource management

Functional E-Business Systems Marketing Info Systems

Interactive Marketing Customer focused marketing process Two way transaction between business

and customer Encourages customers to become

involved in product development, delivery and service issues

Enabled by various Internet technologies such as chat rooms, discussion forums, email, etc

Functional E-Business Systems Marketing Info Systems continued…

Targeted marketing Appeal to people in specific communities Banners or billboards can be placed on

websites other than the companies home page

Ads are only placed on related sites Aimed at specific demographics of people Track person’s online behavior to target each

visitor personally

Functional E-Business Systems Marketing Info Systems

continued… Sales Force Automation

Outfitting the sales force with notebook computers, web sites, and software

Increases personal productivity of sales people

Speeds up capture and analysis of sales data from the field to headquarters

MarketingInformation

Systems

MarketingInformation

Systems

InteractiveMarketing

Sales ForceAutomation

Sales ForceAutomation

CustomerRelationshipManagement

CustomerRelationshipManagement

SalesManagement

SalesManagement

MarketResearch andForecasting

MarketResearch andForecasting

Advertisingand

Promotions

Advertisingand

Promotions

ProductManagement

ProductManagement

Functional E-Business Systems Manufacturing Systems

Computer Integrated Manufacturing Simplify production processes, product

designs, and factory organization Automate production processes and the

business functions that support them with computers, machines, and robots

Integrate all production and support processes using computers, telecommunications netowrks and other info technologies

Functional E-Business Systems Manufacturing Systems

Process Control Use of computers to control an ongoing

physical process Machine Control

Use of a computer to control the actions of a machine

Robotics These devices control their own activities Used to increase productivity and cut

costs

Engineering Systems

•CAD•CAE•Computer-AidedProcess Planning

ManufacturingExecutionSystems

•Shop Floor•Scheduling•Machine Control•Process Control•Robotic Control

Computer Integrated ManufacturingManufacturing

ResourcePlanning

•ProductionForecasting•ProductionScheduling•Quality Control

RemoteWorker

Supplier

Extranet

Intranet

Functional E-Business Systems Human Resource Systems

Planning to meet the future needs of the organization

Development of employees to their full potential

Control of all personnel policies and programs

•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

Staffing Training &

Development CompensationAdministration

StrategicSystems

TacticalSystems

OperationalSystems

Functional E-Business Systems Accounting Systems

Online Accounting Systems Order Processing Inventory Control Systems Accounts Receivable Accounts Payable Payroll General Ledger

Functional E-Business Systems Financial Management Systems

Cash management Online investment Management Capital Budgeting Financial forecasting and planning

Financial Information

Systems

Financial Information

Systems

FinancialPlanning

FinancialPlanning

CashManagement

InvestmentManagement

InvestmentManagement

CapitalBudgeting

Documents

Chapter Four