1. Enterprise system, business intelligence
Learning unit 3

2. Systems That Span the Enterprise
Enterprise Applications
Span functional areas
Execute business processes across firm
Include all levels of management
Four major applications:
Enterprise systems ERP
Supply chain management systems SCM
Customer relationship management systems CRM
Knowledge management systems KMS
Enterprise applications are used to ensure that TPS, MIS, DSS, and ESS work together smoothly.

3. Enterprise Application Architecture
The multi-colored triangle represents an organization – the ovals represent the business functions and organizational levels affected by enterprise applications.
The horizontal oval extends outside of the triangle because even business functions involving outside entities may be automated by enterprise applications.
Enterprise applications automate processes that span multiple business functions and organizational levels and may extend outside the organization.

4. Enterprise systems
Collects data from different firm functions and stores data in single central data repository
Resolves problem of fragmented, redundant data sets and systems Enables:
Coordination of daily activities
Efficient response to customer orders (production, inventory)
Provide valuable information for improving management decision making

5. How Enterprise Systems Work

6. Enterprise Systems ERP
Enterprise systems integrate the key business processes of an entire firm into a single software system that enables information to flow seamlessly throughout the organization. These systems focus primarily on internal processes but may include transactions with customers and vendors.
Identify the difficulties of creating such a system might be (standardization across many business units, size of the system).

7. Enterprise Systems Enterprise Software Example…
Built around thousands of predefined business processes that reflect best practices
Finance/accounting: General ledger, accounts payable, etc.
Human resources: Personnel administration, payroll, etc.
Manufacturing/production: Purchasing, shipping, etc.
Sales/marketing: Order processing, billing, sales planning, etc.
To implement, firms:
Select functions of system they wish to use
Map business processes to software processes
Use software’s configuration tables for customizing
Example…

8. Enterprise Systems Business Value of Enterprise Systems
Increase operational efficiency
Provide firmwide information to support decision making
Enable rapid responses to customer requests for information or products
Include analytical tools to evaluate overall organizational performance

9. Supply chain management systems
Manage firm’s relationships with suppliers
Share information about
Orders, production, inventory levels, delivery of products and services
Goal: Right amount of products to destination with least amount of time and lowest cost
(SCM systems must be designed with the business processes of potential partners and suppliers in mind)

10. Supply Chain Management Systems
The supply chain
Network of organizations and processes for:
Procuring raw materials
Transforming them into products
Distributing the products
Upstream supply chain:
Firm’s suppliers, suppliers’ suppliers, processes for managing relationships with them
Downstream supply chain:
Organizations and processes responsible for delivering products to customers

11. Supply Chain Management Systems
Nike’s Supply Chain

12. Supply Chain Management Systems
Information and supply chain management
Inefficiencies cut into a company’s operating costs
Can waste up to 25% of operating expenses
Just-in-time strategy:
Components arrive as they are needed
Finished goods shipped after leaving assembly line
Safety stock
Buffer for lack of flexibility in supply chain
Bullwhip effect
Information about product demand gets distorted as it passes from one entity to next across supply chain

13. Supply Chain Management Systems
The Bullwhip Effect

14. Supply Chain Management Systems
Supply chain planning systems
Model existing supply chain
Demand planning
Optimize sourcing, manufacturing plans
Establish inventory levels
Identifying transportation modes
Supply chain execution systems
Manage flow of products through distribution centers and warehouses

15. Supply Chain Management Systems
Push- Versus Pull-Based Supply Chain Models

16. Supply Chain Management Systems
Business Value of Supply Chain Management Systems
Match supply to demand
Reduce inventory levels
Improve delivery service
Speed product time to market
Use assets more effectively
Reduced supply chain costs
Increased sales

17. Customer relationship management systems
Provide information to coordinate all of the business processes that deal with customers in sales, marketing, and service to optimize revenue, customer satisfaction, and customer retention
Integrate firm’s customer-related processes and consolidate customer information from multiple communication channels

18. Why CRM Necessary ?
It costs six times more to sell to a new customer than to sell to an existing one.
A typical dissatisfied customer will tell people.
By increasing the customer retention rate by 5%, profits could increase by 85%.
Odds of selling to new customers = 15%, compared to the odds of selling to existing customers (50%)
70% of complaining customers will remain loyal if problem is solved

19. Customer Relationship Management Systems
What is customer relationship management?
Knowing the customer
In large businesses, too many customers and too many ways customers interact with firm
Customer relationship management (CRM) systems
Capture and integrate customer data from all over the organization
Consolidate and analyze customer data
Distribute customer information to various systems and customer touch points across enterprise
Provide single enterprise view of customers

20. Customer Relationship Management Systems
Customer Relationship Management (CRM)

22. Customer Relationship Management Systems
CRM software packages
More comprehensive packages have modules for:
Partner relationship management (PRM)
Employee relationship management (ERM)
Most packages have modules for
Sales force automation (SFA): Sales prospect and contact information, and sales quote generation capabilities; etc.
Customer service: Assigning and managing customer service requests; Web- based self-service capabilities; etc.
Marketing: Capturing prospect and customer data, scheduling and tracking direct-marketing mailings or ; etc.

23. Customer Relationship Management Systems
Operational CRM:
Customer-facing applications such as sales force automation, call center and customer service support, and marketing automation
Analytical CRM:
Analyze customer data output from operational CRM applications
Based on data warehouses populated by operational CRM systems and customer touch points
Customer lifetime value (CLTV)

24. Customer Relationship Management Systems

25. Customer Relationship Management Systems
Analytical CRM Data Warehouse

26. Salesforce.com Executive Team Dashboard
Illustrated here are some of the capabilities of Salesforce.com, a market-leading provider of on-demand customer relationship management (CRM) software. CRM systems integrate information from sales, marketing, and customer service.

27. Customer Relationship Management Systems
Business value of customer relationship management
Increased customer satisfaction
Reduced direct-marketing costs
More effective marketing
Lower costs for customer acquisition/retention
Increased sales revenue
Reduced churn rate
Churn rate:
Number of customers who stop using or purchasing products or services from a company.
Indicator of growth or decline of firm’s customer base

28. Knowledge management systems
Support processes for acquiring, creating, storing, distributing, applying, integrating knowledge
Collect internal knowledge and link to external knowledge
Include enterprise-wide systems for:
Managing documents, graphics and other digital knowledge objects
Directories of employees with expertise

29. Knowledge management systems
Knowledge management: Set of business processes developed in an organization to create, store, transfer, and apply knowledge
Knowledge management value chain:
Each stage adds value to raw data and information as they are transformed into usable knowledge
Knowledge acquisition
Knowledge storage
Knowledge dissemination
Knowledge application

30. The Knowledge Management System
The Knowledge Management Value Chain

31. Examples..
AskMe
Used software to detect keywords from and documents created
Created knowledge base
Allowed for search query on Web
Search returns names of employees

32. Business Intelligence
Business intelligence is a data analysis process aimed at boosting business performance by helping corporate executives and other end users make more informed decisions.
Tools for consolidating, analyzing, and providing access to vast amounts of data to help users make better business decisions

33. Business Intelligence
Data warehouses are useless without software tools
Process data into information
Business intelligence (BI): information gleaned with information tools
Principle tools include:
Software for database query and reporting
Online analytical processing (OLAP)
Data mining

34. Data Mining
Data mining: Processing of extracting hidden information from Data ( Mostly from BIG DATA, DATA Warehouse)
By selecting, exploring, and modeling data
Supports decision making
Finds relationships and ratios within data
Finds unknown relationships
Queries are more complex than traditional
Combination of data-warehouse and data- mining facilitates predictions

35. Data Mining (continued)
Data mining has four objectives
Sequence or path analysis
Classification
Clustering
Forecasting
Techniques applied to various fields
Marketing
Fraud detection
Marketing to individual

36. Data Mining (continued)
Data mining can predict customer behavior
Banking
Find profitable customers
Find patterns of fraud
Mobile phones
Customers tend to switch companies often
Customer loyalty programs ensure steady flow of customer data

37. Data Mining Application

38. Data Mining (continued)
Inferring demographics
Predict what customers likely to purchase in future
Amazon.com
Age ranges estimated from purchase history
Advertises for appropriate age group
Anticipates holidays
Facebook
For demographic and content display

39. Online Analytical Processing
Online analytical processing (OLAP): application to exploit data warehouses
Extremely fast response
View combinations of two dimensions
Drilling down: start with broad info and get more specific
Can receive info in numbers or percentages
Uses specifically tailored data or relational database

40. Online Analytical Processing (continued)

41. Online Analytical Processing (continued)
OLAP application composes tables immediately
Dimensional database: data organized into tables
Tables show information in summaries
Companies sell multidimensional database packages
OLAP applications are powerful tools for executives

42. Online Analytical Processing (continued)
OLAP faster than relational applications
OLAP increasingly used by corporations
Office Depot used OLAP on data warehouse
CVS let 2,000 employees run analyses
Ben & Jerry’s track ice cream popularity
BI software becoming easier to use
Intelligent interfaces

43. Executive Dashboards Dashboard: interface between BI tool and user
Resembles a car dashboard
Contains visual images
Designed to quickly represent specific data

44. Next
Network, Internet and e-Commerce