MIS 6 ENTERPRISE SYSTEMS 11 BIDGOLI Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

LEARNING OUTCOMES 2 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS5 | CH11 1Explain how supply chain management is used 2Describe customer relationship management systems 3Describe knowledge management systems 4Describe enterprise resource planning systems

3 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Enterprise Resource Planning (ERP) Integrated system that collects and processes data Manages and coordinates resources, information, and functions throughout an organization Includes hardware, software, procedures, and input from all functional areas Uses a unified database to store data for various functions

4 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS5 | CH11 Exhibit 11.3 ERP Configuration

5 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS5 | CH11 Table 11.1 ERP Components

6 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Benefits of a Well-designed ERP System Increased: Availability and timeliness of information Data accuracy and improved response time Improved: Customer satisfaction Employee satisfaction Planning and scheduling Supplier relationship Reliability of information

7 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Benefits of a Well-designed ERP System Reduced: Inventory costs Labor costs Order-to-fulfillment time

8 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 ERP Systems Drawbacks High cost Difficulties in installation Needs extensive training Compatibility problems with legacy systems Available as modules so an organization can purchase only required components Keeps costs down for organizations

9 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Enterprise System Application used in all the functions of a business which supports decision making throughout the organization Supply chain Integrated network consisting of an organization, its suppliers, transportation companies, and brokers Used to deliver goods and services to customers

10 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS5 | CH11 Exhibit 11.1 Supply Chain Configuration

11 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Supply Chain Management (SCM) Process of working with suppliers and other partners in the supply chain to improve procedures for delivering products Functions Procuring materials Transforming materials into intermediate and finished products Distributing finished products to customers

12 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Supply Chain Management (SCM) Communication in SCM system takes place among Product flow Information flow Finances flow Key decisions in SCM Location Inventory Production Transportation

13 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Electronic Data Interchange (EDI) Enables business partners to exchange information Expedites delivering accurate information Web-based EDI: Using the Internet and Web protocols to transmit documents Lowers cost Platform independent and easy to use

14 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Drawbacks of EDI Uses proprietary standards Cost per partner is higher when the number of partners is small Organizations can use the Internet and Open EDI to perform the same function as EDI

15 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Internet-Enabled SCM Improves information sharing throughout the supply chain Improves SCM activities Purchasing/procurement Inventory management Transportation Order processing Customer service Production scheduling

16 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 E-Marketplaces Third-party exchange that provides a platform for buyers and sellers to interact and trade efficiently Helps maintain a competitive edge in the supply chain Provides opportunities for sellers and buyers to establish partnerships Offers a single platform for prices, availability, and stock levels that’s accessible to all participants

17 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 E-Marketplaces Solves time constraint problems for international trade Makes it easy to compare prices and products from a single source instead of spending time contacting each seller Reduces marketing costs more than traditional sales channels

18 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 E-Distributor Marketplace owned and operated by a third party that provides an electronic catalog of products Maintenance, repair, and operations (MROs) services Example of a horizontal market Offers fast delivery of a wide selection of products and services, at lower prices Helps companies reduce the time and expense of searching for goods

19 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Online Auctions Brings traditional auctions to customers around the globe Makes it possible to sell far more goods and services than at a traditional auction Based on the brokerage business model which brings buyers and sellers together Cost-effective for selling excessive inventory Reverse auctions Invite sellers to submit bids for products and services One-to-many relationship

20 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Collaborative Planning, Forecasting, and Replenishment Used to coordinate supply chain members through point-of-sale (POS) data sharing and joint planning Aims to improve operational efficiency and manage inventory Advantages: Decreases merchandising, inventory, and logistics costs

21 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Collaborative Planning, Forecasting, and Replenishment Ensures that inventory and sales data are shared across the supply chain Exception management: Planning for handling unforeseen problems Lessons learned during the process can be used in future planning

22 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS5 | CH11 Exhibit 11.2 CPFR Process

23 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Customer Relationship Management (CRM) Consists of the processes a company uses to track and organize its contacts with customers Improves services offered to customers Uses customer contact information for targeted marketing Involves marketing strategies which focus on long-term relationships Identifying customer segments

24 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Customer Relationship Management (CRM) Improving products to meet customers’ needs Improving customer retention Identifying a company’s profitable and loyal customers Helps organizations make use of data, and knowledge to understand customers Gives organizations complete picture of their customers

25 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 CRM Activities Sales automation Order processing Marketing automation Customer support Knowledge management Personalization technology

26 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 CRM Applications Implemented with either on-premise CRM or Web-based CRM approach Software packages available for setting up a CRM system Amdocs CRM Optima Technologies ExSellence Infor CRM SAP mySAP Oracle PeopleSoft CRM Oracle Siebel

27 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Features of Software Packages Salesforce automation eCRM or Web-based CRM Survey management Automated customer service

28 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Personalization Technology Personalization: Process of satisfying customers’ needs, building customer relationships, and increasing profits Design goods and services that meet customers’ preferences better Customization: Allows customers to modify the standard offering Selecting a different home page to be displayed each time you open your Web browser

29 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Personalization Technology Using personalization requires gathering customer information Preferences and shopping patterns Used by companies to improve customer service Implementation requires Internet, databases Data warehouse/data marts Data-mining tools Mobile networks

30 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Collaborative Filtering (CF) Search for specific information or patterns, using input from multiple business partners and data sources Identifies groups of people based on common interests and recommends products Works well for a single product category Drawback: Needs a large sample of users and content to work well Fails to make recommendations across unrelated categories

31 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Knowledge Management (KM) Draws on concepts of organizational learning, culture, and best practices to convert tacit knowledge into explicit knowledge Creates a knowledge sharing culture in an organization Eliminates obstacles to sharing knowledge Technique to improve CRM systems Identifying, storing, and disseminating facts about how to perform tasks

32 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Knowledge Management (KM) Knowledge repository Stores knowledge of experts Created for employees to refer to when needed Knowledge management system consists of using groupware Other tools and technologies DBMSs, data-mining tools, decision support systems

33 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Contributions of Knowledge Management System to Organizations Promote innovation by encouraging free exchange of ideas Improve customer service by reducing response time Increase revenue by reducing the delivery time for products and services Improve employee retention rates by rewarding employees for their knowledge

34 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Chief Knowledge Officer (CKO) Position created by organizations because of the importance of Knowledge Knowledge management Knowledge management systems Responsible for overseeing knowledge management within an organization

35 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS6| CH11 Chief Knowledge Officer (CKO) Ensures knowledge resources are properly collected stored, and disseminated among the decision-makers Ensures organization profits from knowledge resources Tries to maximize the return on investment (ROI) related to KM, KMS and processes

KEY TERMS 36 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS5 | CH11 Collaborative filtering (CF) Collaborative planning, forecasting, and replenishment (CPFR) Customer relationship management (CRM) Customization e-marketplace Electronic data interchange (EDI) Enterprise resource planning (ERP)

KEY TERMS 37 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS5 | CH11 Enterprise system Knowledge management (KM) Online auction Personalization Reverse auction Supply chain Supply chain management (SCM)

SUMMARY 38 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS5 | CH11 Supply chains exist in both service and manufacturing organizations, although the chain’s vary in different organizations and industries CRM system helps organizations make better use of data and knowledge to understand their customers ERP systems use a unified database to store data for various functions

39 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. MIS5 | CH11