Ebusiness.2

Ebusiness & Information Systems - Presentation Transcript
1. E-Business: How Businesses Use Information Systems
2. STUDENT LEARNING OBJECTIVES Essentials of Business Information Systems E-Business: How Businesses Use
Information Systems
o What are the major features of a business that are important for understanding the role of information systems?
o How do information systems support the major business functions: sales and marketing, manufacturing and
production, finance and accounting, and human resources?
o How do systems serve the various levels of management in a business and how are these systems related?
3.
o How do enterprise applications, collaboration and communication systems, and intranets improve
organizational performance?
o What is the role of the information system’s function in a business?
STUDENT LEARNING OBJECTIVES (Continued) Essentials of Business Information Systems E-Business: How
Businesses Use Information Systems
4.
o Problem: Changing business model caused unnecessary difficulty for Tupperware sales consultants.
o Solutions: Implement Web-based order management system that simplifies order entry and other tasks.
Information Systems Join the Tupperware Party Essentials of Business Information Systems E-Business: How
5.
o Oracle Collaboration Suite and Oracle Portal also streamlines communication and support.
o Demonstrates IT’s role in centralizing data, improving production processes, and driving growth and
profitability.
o Illustrates the importance of automating business processes to reduce workloads and increase productivity.
Information Systems Join the Tupperware Party Essentials of Business Information Systems E-Business: How
6. Information Systems Join the Tupperware Party Essentials of Business Information Systems E-Business: How
7. Components of a Business
o Four basic business functions
 Manufacturing and production
 Sales and marketing
 Finance and accounting
 Human resources
Organizing a Business: Basic Business Functions Essentials of Business Information Systems E-Business: How
Businesses Use Information Systems Business: Formal organization that makes products or provides a service in
order to make a profit
8. Figure 2-1 Every business, regardless of its size, must perform four functions to succeed. It must produce the product
or service; market and sell the product; keep track of accounting and financial transactions; and perform basic human
resources tasks, such as hiring and retaining employees. The Four Major Functions of a Business Components of a
Business Essentials of Business Information Systems E-Business: How Businesses Use Information Systems
9. Components of a Business
o Five basic business entities:
 Suppliers
 Customers
 Employees
 Invoices/payments
 Products and services

Organizing a Business: Basic Business Functions Essentials of Business Information Systems E-Business: How
10.
o Logically related set of tasks that define how specific business tasks are performed
 The tasks each employee performs, in what order, and on what schedule
 E.g. Steps in hiring an employee
o Some processes tied to functional area
 Sales and marketing: Identifying customers
o Some processes a r e cross-functional
 Fulfilling customer order
Business Processes Components of a Business Essentials of Business Information Systems E-Business: How
11. Figure 2-2 Fulfilling a customer order involves a complex set of steps that requires the close coordination of the sales,
accounting, and manufacturing functions. The Order Fulfillment Process Components of a Business Essentials of
Business Information Systems E-Business: How Businesses Use Information Systems
12.
o Read the Interactive Session and then discuss the following questions:
 What are the basic principles of Toyota’s production system? To which areas of the organization do these
principles apply?
 How is TPS interconnected with the culture at Toyota? Are TPS and Toyota’s culture interdependent?
Could one exist without the other?
 Describe how information systems support each of the business processes described in this case.
Interactive Session: Organizations Toyota As Number One Components of a Business Essentials of Business
Information Systems E-Business: How Businesses Use Information Systems
13.
o Firms coordinate work of employees by developing hierarchy in which authority is concentrated at top
 Senior management
 Middle management
 Operational management
 Knowledge workers
 Data workers
 Production or service workers
o Each group has different needs for information
Managing a Business and Firm Hierarchies Components of a Business Essentials of Business Information Systems
E-Business: How Businesses Use Information Systems
14. Figure 2-3 Business organizations are hierarchies consisting of three principal levels: senior management, middle
management, and operational management. Information systems serve each of these levels. Scientists and
knowledge workers often work with middle management. Levels in a Firm Components of a Business Essentials of
15.
o Global environment factors
 Technology and science
 Economy
 Politics
 International change
o Immediate environment factors
 Customers
 Suppliers
 Competitors
 Regulations
 Stockholders

The Business Environment Components of a Business Essentials of Business Information Systems E-Business: How
16. Figure 2-4 To be successful, an organization must constantly monitor and respond to—or even anticipate—
developments in its environment. A firm's environment includes specific groups with which the business must
deal directly, such as customers, suppliers, and competitors as well as the broader general environment, including
socioeconomic trends, political conditions, technological innovations, and global events. The Business Environment
Components of a Business Essentials of Business Information Systems E-Business: How Businesses Use
Information Systems
17.
o Firms invest in information systems in order to:
 Achieve operational excellence
 Develop new products and services
 Attain customer intimacy and service
 Improve decision making
 Promote competitive advantage
 Ensure survival
The Role of Information Systems in a Business Components of a Business Essentials of Business Information
Systems E-Business: How Businesses Use Information Systems
18.
o Sales and marketing systems
o Manufacturing and production systems
o Finance and accounting systems
o Human resources systems
Systems from a Functional Perspective Types of Business Information Systems Essentials of Business Information
19.
o Sales and marketing systems
 Support activities for selling and marketing firm’s products or services
 Senior management:
 Monitor trends affecting products and sales, planning for new products and services, monitor
performance of competitors
 Middle management:
 Support market research, analyze marketing campaigns, pricing decisions, sales performance
 Operational management and employees:
 Locating and contacting prospective customers, process orders, provide customer service support
20. Figure 2-5 This system captures sales data at the moment the sale takes place to help the business monitor sales
transactions and to provide information to help management analyze sales trends and the effectiveness of marketing
campaigns. Example of a Sales Information System Components of a Business Essentials of Business Information
21.
o Manufacturing and production systems
 Support activities for producing firm’s products or services
 Help plan long-term manufacturing goals, such as technology investments and locating new plants
 Analyze and monitor manufacturing and production costs and resources
 Manage status of production tasks

22. Figure 2-6 This system provides information about the number of items available in inventory to support
manufacturing and production activities. Overview of an Inventory System Components of a Business Essentials of
23.
o Finance and accounting systems
 Support activities for managing financial assets, firm’s capitalization, and financial records
 Establish long-term investment goals and provide long-range forecasts of firm’s financial
performance
 Oversee and control firm’s financial resources
 Track flow of funds in firm through transactions (paychecks, payments, securities reports, receipts,
etc.)
24. Figure 2-7 An accounts receivable system tracks and stores important customer data, such as payment history, credit
rating, and billing history. An Accounts Receivable System Components of a Business Essentials of Business
Information Systems E-Business: How Businesses Use Information Systems
25.
o Human resources systems
 Support activities for attracting, developing, and maintaining firm’s workforce
 Identify manpower requirements (skill, education level, types and numbers of positions, etc.) for
meeting long-term business plans
 Monitor and analyze recruitment, allocation, and compensation of employees
 Track recruitment and placement of employees
26. Figure 2-8 This system maintains data on the firm’s employees to support the human resources function. An
Employee Record-Keeping System Components of a Business Essentials of Business Information Systems E-
Business: How Businesses Use Information Systems
27.
o Read the Interactive Session and then discuss the following questions:
 Did Google’s traditional hiring practices create business problems? Explain your answer.
 Is Google’s quantitative approach to hiring a good solution to its employee recruiting problems? Why or
why not?
 What role does culture play in Google’s hiring preferences?
 What kind of system or systems described in this chapter are discussed in this case? What are the
inputs, processes, and outputs?
Interactive Session: People Google’s New Search for the Best and the Brightest Essentials of Business Information
Systems E-Business: How Businesses Use Information Systems Types of Business Information Systems
28.
 Create a list of ten questions that you think might be appropriate for Google’s job applicant survey. Justify
each question with a short explanation of why the answer would be useful.
 If you were applying for a job at Google, how would you want to be evaluated? Which evaluation
techniques do you think favor your strengths? Which techniques might expose your weaknesses?
Interactive Session: People Google’s New Search for the Best and the Brightest Essentials of Business Information
Systems E-Business: How Businesses Use Information Systems Types of Business Information Systems
29.
o Transaction processing systems

 K eep track of basic activities and transactions of organization (e.g. sales, receipts, cash deposits,
payroll, credit decisions, flow of materials in a factory )
o Management information systems and decision-support systems
 H elp with monitoring, controlling, decision-making, and administrative activities
o Executive support systems :
 Help a ddress strategic issues and long-term trends, both in firm and in external environment
Systems from a Constituency Perspective Types of Business Information Systems Essentials of Business Information
30.
o Transaction processing systems
 Serve operational managers
 P rincipal purpose is to answer routine questions and to track the flow of transactions through the
organization
 E.g. Inventory questions, granting credit to customer
 Monitor status of internal operations and firm’s relationship with external environment
 Major producers of information for other systems
 Highly central to business operations and functioning
31.
o Management information systems
 Provide middle managers with reports on firm’s performance
 To monitor firm and help predict future performance
 Summarize and report on basic operations using data from TPS
 Provide weekly, monthly, annual results, but may enable drilling down into daily or hourly data
 Typically not very flexible systems with little analytic capability
32. How MIS Obtain Data from Organization’s TPS Systems That Span the Enterprise Essentials of Business Information
Systems E-Business: How Businesses Use Information Systems Figure 2-9 In the system illustrated by this diagram,
three TPS supply summarized transaction data to the MIS reporting system at the end of the time period. Managers
gain access to the organizational data through the MIS, which provides them with the appropriate reports.
33. Sample MIS Report Systems That Span the Enterprise Essentials of Business Information Systems E-Business: How
Businesses Use Information Systems Figure 2-10 This report, showing summarized annual sales data, was produced
by the MIS in Figure 2-9.
34.
o Decision support systems (DSS)
 Support non-routine decision making for middle management
 E.g. What would impact on production schedules be if sales doubled in December?
 Use information from TPS, MIS, and external sources
 Use models to analyze data
 E.g. voyage estimating system of metals company that calculates financial and technical voyage
details
 Focus on extracting, analyzing information from large amounts of data
35. Voyage-Estimating Decision Support System Systems That Span the Enterprise Essentials of Business Information
Systems E-Business: How Businesses Use Information Systems Figure 2-11 This DSS operates on a powerful PC. It
is used daily by managers who must develop bids on shipping contracts.
36.
o Executive support systems (ESS)
 Serve senior managers

 Address strategic issues and long-term trends
 E.g. What products should we make in 5 years?
 Address non-routine decision-making
 Provide generalized computing capacity that can be applied to changing array of problems
 Draw summarized information from MIS, DSS and data from external events
 Typically use portal with Web interface to present content
37. Model of an Executive Support System Systems That Span the Enterprise Essentials of Business Information
Systems E-Business: How Businesses Use Information Systems Figure 2-12 This system pools data from diverse
internal and external sources and makes them available to executives in an easy-to-use form.
38.
o TPS: Major source of data for other systems
o ESS: Primarily a recipient of data from lower-level systems
o Other systems may exchange data as well
o Exchange of data between functional areas
 E.g. Sales order transmitted to manufacturing system
o In most organizations, systems are loosely integrated
Relationship of Systems to One Another Types of Business Information Systems Essentials of Business Information
39. Interrelationships Among Systems Systems That Span the Enterprise Essentials of Business Information Systems E-
Business: How Businesses Use Information Systems Figure 2-13 The various types of systems in the organization
have interdependencies. TPS are major producers of information that is required by many other systems in the firm,
which, in turn, produce information for other systems. These different types of systems have been loosely coupled in
most organizations.
40. Enterprise Applications Essentials of Business Information Systems E-Business: How Businesses Use Information
Systems Systems That Span the Enterprise
o Enterprise applications are systems that span functional areas and automate processes for multiple business
functions and organizational areas; they include:
 Enterprise systems
 Supply chain management systems
 Customer relationship management systems
 Knowledge management systems
41. Enterprise Application Architecture Systems That Span the Enterprise Essentials of Business Information Systems E-
Business: How Businesses Use Information Systems Figure 2-14 Enterprise applications automate processes that
span multiple business functions and organizational levels and may extend outside the organization.
42.
o Integrate data from key business processes into single system
o Speed communication of information throughout firm
o Enable greater flexibility in responding to customer requests, greater accuracy in order fulfillment
o Enable managers of large firms to assemble overall view of operations
o Alcoa used ERP to eliminate redundancies and inefficiencies in its disparate systems
Enterprise Systems Essentials of Business Information Systems E-Business: How Businesses Use Information
43. Enterprise Systems Systems That Span the Enterprise Essentials of Business Information Systems E-Business: How
Businesses Use Information Systems Figure 2-15 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.
44.
o Manage relationships with suppliers, purchasing firms, distributors, and logistics companies
o Manage shared information about orders, production, inventory levels, etc.
 Goal is to move correct amount of product from source to point of consumption as quickly as possible
and at lowest cost
o Type of interorganizational system:
 Automating flow of information across organizational boundaries

Supply Chain Management Systems Essentials of Business Information Systems E-Business: How Businesses Use
Information Systems Systems That Span the Enterprise
45. Example of a Supply Chain Management System Systems That Span the Enterprise Essentials of Business
Information Systems E-Business: How Businesses Use Information Systems Figure 2-16 Customer orders, shipping
notifications, optimized shipping plans, and other supply chain information flow among Haworth’s Warehouse
Management System (WMS), Transportation Management System (TMS), and its back-end corporate systems.
46.
o Help manage relationship with customers
o Coordinate business processes that deal with customers to optimize revenue and customer satisfaction, and
increase sales
o Combine sales, marketing, and service record data from multiple communication channels to provide unified
view of customer, eliminate duplicate efforts
o E.g. Saab CRM applications to achieve 360 º view of customers resulted in greater follow-up rate on sales
leads and increased customer satisfaction
Customer Relationship Management Systems Essentials of Business Information Systems E-Business: How
Businesses Use Information Systems Systems That Span the Enterprise
47. Essentials of Business Information Systems E-Business: How Businesses Use Information Systems Systems That
Span the Enterprise 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.
48. Essentials of Business Information Systems E-Business: How Businesses Use Information Systems Systems That
Span the Enterprise
o Intangible knowledge assets
 Knowledge about producing and delivering products
 Source of value and advantage for firms
o Knowledge management systems:
 Help capture, storage, distribute, and apply knowledge so that it can be leveraged for strategic benefit
 Include systems for:
 Managing and distributing documents, graphics, other digital knowledge objects
 Creating knowledge directories of employees with specialized expertise
 Distributing knowledge
Knowledge Management Systems
49. Intranets and Extranets Essentials of Business Information Systems E-Business: How Businesses Use Information
o Technology platforms that increase integration and expedite the flow of information
 Intranets:
 Internal networks based on Internet standards
 Typically utilize a portal
 Extranets:
 Intranets extended for authorized use outside the company for partners, customers
 Facilitate collaboration
50. Collaboration and Communication Systems: “Interaction” Jobs in a Global Economy Essentials of Business
Information Systems E-Business: How Businesses Use Information Systems Systems That Span the Enterprise
o Interaction jobs:
 Primary value-adding activities are talking, e-mailing, presenting, persuading
 41% of U.S. labor force
 70% of new jobs since 1998
 Involves knowledge and problem-solving that can’t be put into information system
51. Collaboration and Communication Systems: “Interaction” Jobs in a Global Economy Essentials of Business
Information Systems E-Business: How Businesses Use Information Systems Systems That Span the Enterprise
o Enterprise-wide information system solutions for interaction
 Internet-based collaboration environments
 E-mail and instant messaging (IM)
 Cell phones and wireless handhelds
 Social networking
 Wikis

 Virtual worlds
52. E-Business, E-Commerce, and E-Government Essentials of Business Information Systems E-Business: How
Businesses Use Information Systems Systems That Span the Enterprise
o E-business
 Use of digital technology and Internet to drive major business processes
o E-commerce
 Subset of e-business
 Buying and selling goods and services through Internet
o E-government:
 Using Internet technology to deliver information and services to citizens, employees, and businesses
53. The Information Systems Department Essentials of Business Information Systems E-Business: How Businesses Use
Information Systems The Information System’s Function in Business
o Programmers
o Systems analysts
 Principle liaisons to rest of firm
o Information systems managers
 Leaders of teams of programmers and analysts, project managers, physical facility managers,
telecommunications managers, database specialists, managers of computer operations and data entry
staff
o Senior managers: CIO, CSO, CKO
o End users
o External specialists
54. Information Systems Services Essentials of Business Information Systems E-Business: How Businesses Use
Information Systems The Information System’s Function in Business
o Services provided by the information systems department include:
 Computing and telecommunications services
 Data management services
 Application software services
 Physical facilities management services
 IT management services
 IT standards services
 IT educational services
 IT research and development services

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