1. e-Business Systems Chapter 7
McGraw-Hill/Irwin
Copyright © 2010 by the McGraw-Hill Companies, Inc. All rights reserved.

2. Learning Objectives
Identify these cross-functional enterprise systems, and give examples of how they can provide business value to a company
Resource planning
Customer Relationship Management
Supply chain management
Enterprise application integration
Transaction processing systems
Enterprise collaboration systems

3. Learning Objectives
Give examples of how the Internet and other information technologies support business processes within the business functions of
Accounting
Finance
Human resource management
Marketing
Production
Operations management

4. Learning Objectives
Understand the need for enterprise application integration to improve the support of business interactions across multiple e-business applications

5. Enterprise Business Systems
Using the Internet, other networks, and IT to support…
Electronic commerce
Enterprise communications and collaboration
Web-enabled business processes
E-commerce
Buying, selling, and marketing of products, services, and information over the Internet and other networks

6. Case 1: NetSuite, Berlin Packaging, Churchill Downs…
CRM software helps sales and marketing professionals increase sales revenue by providing more and better services to customers and prospects
CRM implementation
Often fails due to difficulty of migrating data
Is easier to do early in a company’s history
Companies must ensure data are in order before launching any major CRM initiative

7. Case Study Questions
What are the business benefits of CRM implementations for organizations such as Berlin Packaging and Churchill Downs?
What other uses of CRM would you recommend to the latter?
Do you agree that smaller organizations are better positioned to be more effective users of CRM than larger ones?

8. Case Study Questions
One of the main issues in the case is the importance of “good” data to the success of CRM implementations
In Chapter 5, we compared the file processing and database management approaches to data resource management
Which of the problems discussed there do you see in this case?
How do CRM applications attempt to address them?

9. Cross-Functional Systems
Cross-functional systems are used to reengineer and improve vital business processes all across the enterprise
Cross-functional systems cross the boundaries of traditional business functions

10. Enterprise Application Architecture
This slide presents an overview of enterprise application architecture. It shows the major cross-functional enterprise applications and their interrelationships.
Focuses on accomplishing fundamental business processes in concert with
Customers
Suppliers
Partners
Employees

11. Managing at the Enterprise Level
Getting the whole business to fly in the same direction, as efficiently as possible
Customer relationships
Back-office operations
Movement of raw materials & finished goods

12. Customer Relationship Management
A customer-centric focus
Customer relationships are a company’s most valued asset
Every company should find and retain the most profitable customers possible

13. What is CRM?
Managing the full range of the customer relationship involves two related objectives
(1) Providing customer-facing employees with a single, complete view of every customer, at every touch point, across all channels
(2) Providing the customer with a single, complete view of the company and its extended channels
CRM uses IT to create a cross functional enterprise system that integrates and automates customer-serving processes

14. Application Clusters in CRM

15. Contact and Account Management
CRM helps sales, marketing, and service professionals capture and track relevant data about
Every past and planned contact with prospects and customers
Other customer business & life-cycle events
Data are captured through touchpoints
Telephone, fax, , Websites
Retail stores, kiosks, personal contact

16. Sales
A CRM system provides sales reps with the tools and data resources they need to
Support and manage sales activities
Optimize cross- and up-selling
CRM also provides the means to check on a customer’s account status and history before scheduling sales calls

17. Marketing and Fulfillment
CRM systems help with direct marketing campaigns by automating tasks
Qualifying leads for targeted marketing
Scheduling and tracking mailings
Capturing and managing responses
Analyzing the business value of a campaign
Fulfilling responses & requests

18. Customer Service and Support
CRM helps customer service managers create, assign and manage customers’ requests for service
Call center software
Help desk software
Web-based self-service

19. Retention and Loyalty Programs
The odds of selling to an existing customer are 50%; a new one 15%
70% of complaining customers will do business with the company again if it quickly fixes a problem
It costs 6 times more to sell to a new customer
An unhappy customer will tell 8-10 others
Boosting customer retention 5% can boost profits 85%

20. Retention and Loyalty Programs
Enhancing and optimizing customer retention and loyalty is a primary objective of CRM
Identify, reward, and market to the most loyal and profitable customers
Evaluate targeted marketing and relationship programs

21. Three Phases of CRM

22. Benefits and Challenges of CRM
Benefits of CRM
Identify and target the best customers
Real-time customization and personalization of products and services
Track when and how a customer contacts the company
Provide a consistent customer experience
Provide superior service and support across all customer contact points

23. CRM Failures Business benefits of CRM are not guaranteed
50% of CRM projects did not produce promised results
20% damaged customer relationships
Reasons for failure
Lack of understanding and preparation
Not solving business process problems first
No participation on part of involved business stakeholders

24. What is ERP? A cross-functional enterprise system
Facilitates business, supplier, and customer information flows
The backbone of business processes
A cross-functional enterprise system
Supports basic internal business processes
An integrated suite of software modules

25. ERP Application Components

26. Benefits and Challenges of ERP
ERP Business Benefits
1. Quality & efficiency
2. Decreased costs
3. Decision support
4. Enterprise agility
ERP Costs
1. High risk & cost
2. Hardware and software are a small part of overall project
3. Failure can cripple or kill a business

27. Costs of Implementing a New ERP

28. Common Causes of ERP Failure
Causes of ERP Failures
Common Causes of ERP Failure
Under-estimating the complexity of planning, development, training
Failure to involve affected employees in planning and development
Over-reliance on ERP vendor or consultants
Insufficient training
Insufficient data conversion and testing
Trying to do too much, too fast

29. Supply Chain Management (SCM)
Supply chain management helps a company
Get the right products
To the right place
At the right time
In the proper quantity
At an acceptable cost

30. Receive feedback on the status of every link in the supply
Goals of SCM
Forecast demand
Control inventory
Enhance relationships with customers, suppliers, distributors, and others
Receive feedback on the status of every link in the supply

31. What is a Supply Chain? The interrelationships
With suppliers, customers, distributors, and other businesses
Needed to design, build, and sell a product
Each supply chain process should add value to the products or services a company produces
Frequently called a value chain

32. Supply Chain Life Cycle

33. Electronic Data Interchange
The electronic exchange of business transaction documents between supply chain trading partners
One of the earliest uses of information technology for supply chain management
The almost complete automation of an e-commerce supply chain process
Many transactions occur over the Internet, using secure virtual private networks

34. Typical EDI Activities

35. Roles and Activities of SCM in Business

36. Planning & Execution Functions of SCM
Supply chain design
Collaborative demand & supply planning
Execution
Materials management
Collaborative manufacturing
Collaborative fulfillment
Supply chain event management
Supply chain performance management

37. Benefits and Challenges of SCM
Faster, more accurate order processing
Reductions in inventory levels
Key Benefits
Strategic relationships with supplier
Quicker times to market
Lower transaction and materials cost

38. Goals and Objectives of SCM

39. Benefits and Challenges of SCM
Key Challenges
Lack of demand planning knowledge, tools, and guidelines
Inaccurate data provided by other information systems
Lack of collaboration among marketing, production, and inventory management
SCM tools are immature, incomplete, and hard to implement

40. Enterprise Application Integration
EAI software connects cross-functional systems
Serves as middleware to provide
Data conversion
Communication between systems
Access to system interfaces

41. How EAI Works

42. Transaction Processing Systems
Cross-functional information systems that process data resulting from the occurrence of business transactions
Transactions include sales, purchases, deposits, withdrawals, refunds, and payments
Online transaction processing (OLTP) is a real-time system that captures transactions immediately

43. Transaction Processing Systems

44. The Transaction Processing Cycle

45. Enterprise Collaboration Systems (ECS)
EC systems are cross-functional information systems that enhance team and workgroup
Communication
Coordination
Collaboration
Systems may include
Networked PC workstations
Servers
Databases
Groupware and application packages

46. ECS Tools

47. Functional Business Systems
Various types of information systems that support the business functions of…
Accounting
Finance
Marketing
Operations management
Human resource management

48. Case 2: OHSU, Sony, Novartis, and Others
Oregon Health & Science University uses Oracle’s iRecruitment application, which is part of its E-Business HR Management System suite
Managers can request a new employee and process applications electronically
Handles most administrative work, including routing forms and posting jobs on the Web site
The university fills job openings two weeks faster and saves $1,500 per job
More and more HR is being called to be a strategic business partner, and professionals in this area are turning to IT for innovative solutions

49. Case Study Questions
What are some of the business benefits of the technologies described in the case?
Provide examples beyond the automation of transaction-oriented processes
Do you think the business value of these strategic HRM applications depends on the type of business a company is in?
For instance, consulting, manufacturing, or professional services?

50. Case Study Questions
What are some of the challenges and obstacles in developing and implementing HRM systems?
Are these unique to this type of system?
What strategies would you recommend for companies to meet those challenges?

51. IT in Business

52. Marketing Systems Marketing systems are concerned with…
Planning, promotion, and sale of existing products in existing markets
Development of new products and new markets
Better attracting and serving present and potential customers

53. Marketing Information Systems

54. Interactive Marketing
A customer-focused marketing process
Uses the Internet, intranets, and extranets
Establishes two-way transactions between a business and its customers or potential customers
Goal
Profitably use networks to attract and keep customers
Get customers to help create, purchase, and improve products and services

55. Targeted Marketing
Community: customized ads to appeal to specific virtual communities
Content: ads placed on a variety of selected websites, aimed at a specific audience
Context: ads placed on web pages that are relevant to a product or service
Demographic/Psychographic: web marketing aimed at specific types or classes of people
Online behavior: promotions tailored to each visit to a site by an individual
Advertising and promotion management concept with five targeting components

56. Sales Force Automation
Outfit sales force with notebook computers, web browsers, and sales contact software
Connect them to marketing websites and the company intranet
Goals
Increase personal productivity
Speed up capture and analysis of sales data
Gain strategic advantage

57. Manufacturing Information Systems
Supports production/operations functions
All activities concerned with planning and control of the processes tied to producing goods or services

58. Computer-Integrated Manufacturing

59. CIM Objectives
Simplify… production processes, product designs, and factory organization
Automate… production processes and the business functions that support them
Integrate… all production and support processes using
Networks
Cross-functional business software
Other information technologies

60. CIM supports the concepts of…
CIM Objectives
CIM supports the concepts of…
Flexible manufacturing systems
Agile manufacturing
Total quality management (TQM)

61. Manufacturing Information Systems
Computers help engineers design products
Computer-aided engineering (CAE)
Computer-aided design (CAD)
Computer-aided manufacturing (CAM)
Manufacturing also uses software
Computer-aided process planning
Material requirements planning (MRP)
Manufacturing resource planning
Manufacturing execution systems (MES)
Process and machine control

62. Human Resource Management (HRM)
Information systems support
Planning to meet personnel needs
Development of employees to their full potential
Control of all personnel policies and programs

63. HRM Systems

64. HRM and the Internet
Recruitment via the company website & commercial recruiting services
Posting messages in selected Internet newsgroups
Communicating with job applicants via

65. HRM and Corporate Intranets
Corporate intranet uses
Process common HRM transactions
Around-the-clock HRM services
Disseminate information faster than previous company channels
Collect information from employees online
Allow HRM tasks to be performed with little HRM dept. intervention
Training

66. Employee Self-Service
Intranet applications can allow employees to
View benefits
Enter travel and expense reports
Verify employment and salary information
Access and update personal information
Enter time-sensitive data
Receive training
Produce automated pay sheets

67. Accounting Information Systems
Oldest and most widely used information system in business
Records and reports business transactions and economic events
Produces financial statements
Forecasts future conditions

68. Accounting Information Systems

69. Financial Management Systems
Supports business managers and professionals making decisions concerning
Financing of a business
Allocation and control of financial resources within a business

70. Financial Management Systems

71. Case 3: Perdue Farms and Others
Even the best companies are challenged by supply chain pressures during holidays
The holiday season is difficult for manufacturers and retailers because they’re making educated guesses and bets on what demand is going to be
They’re not going to get it right every time
Delivering the right number of products to the right customers at the right time is very important
Businesses are turning to forecasting and supply chain management tools

72. Case Study Questions
What key factors determine the success or failure of supply chains during the holiday season?
Which of these are, or could be, under the control of companies, and which are inherent in the end-consumer business?
Consider the increasing use of gift cards in lieu of gifts during the holiday season
What effects does this new practice introduce into demand planning and supply chain management?

73. Case Study Questions
Consider that virtually nothing is known about the recipients of gift cards
What strategies can retailers and their suppliers consider to accommodate these effects?
Prof. Brian Tomlin says that smart companies substitute information for inventory
What do you think he means by this?
How do you think companies can take advantage of more extensive and accurate information to improve their inventory and logistic practices?