Electronic Business Systems

Session 7

Introduction Cross-functional enterprise systems, and examples

of how they can provide significant business value to a company:

Enterprise application integration Transaction processing systems Enterprise collaboration systems

How Internet and other information technologies support business processes within the business functions. of accounting, finance, human resource management, marketing, and production and operations management.

Summary

Agenda

What is E-Business? The use of the Internet and other

networks and information technologies to support electronic commerce, enterprise communications and collaboration, and Web-enabled business processes, both within a networked enterprise and with its customers and business partners.

Applications for e-Business Finance & Accounting Human Resources Sales and Marketing Manufacturing and Production

Finance and Accounting General ledger reporting Project costing Annual reports Budgeting

Human Resources Corporate policies Employee savings plans Benefits enrollment Online training Job posting

Sales and Marketing Competitor analysis Price updates Promotional campaigns Sales presentations Sales contracts

Manufacturing & Production Quality measurements Maintenance schedules Design specifications Machine output Order tracking

Functional Business Systems

Information systems that support the business functions of accounting, finance, marketing, operations management, and human resource management

Cross-Functional Enterprise Systems

Information systems that cross the boundaries of traditional business functions in order to reengineer and improve vital business processes all across the enterprise

Functional Business IS

Enterprise Application Architecture

What is EAI? A step forard in the evolution of

middleware Integrates applications and enterprise

data sources so that they can easily share business processes and data

Integration is done without significant changes of applications and data sources

Enterprise Application Integration (EAI)

Software that integrates a variety of enterprise application clusters by letting them exchange data according to rules derived from the business process models developed by users

EAI Example

ERP System

Legacy System

Databases

CRM System

Enterprise PortalApplication

Financial System

SCM System

Internal Applications(Java,C,C++)

EAI

Transaction Processing Systems Cross-functional: crosses different

functional business areas accounting inventory transactions, human resources direct deposit transactions finance stock/investment transactions

Transactions can include: Banking, Financial, Stocks, etc. Purchases & Orders (phone, Internet, direct) from Airline reservations to Toll Booth Operations

Value of TPS Efficiency

Paperless Transactions Reduce manual data entry (errors) Speed up transaction process Elimination of redundant steps

Transaction Processing Cycle

Data Entry – capture of business data Transaction Processing

Batch processing – transaction data are accumulated over a period of time and processed periodically

Real-Time processing – data are processed immediately after a transaction occurs

Processing CycleData Entry Collecting and capturing

transactions No longer manual:

Old technologies Bar Codes, Magnetic Strips (credit cards)

New technologies RFID, Smart Cards,

Processing CycleTransaction Processing Synchronization Issues:

Which transaction to process next. Breaking ties Dependencies

Can’t schedule delivery before credit approval.

Processing CycleDocument/Report Generation Examples

purchase orders pay checks sales receipts invoices bank statements

An MIS also generates reports, but TPS reports are operational (no analysis).

Processing CycleInquiry Processing Examples

when was a purchase made does a customer have any credits on their account was an item scheduled for delivery was a package signed for

An MIS also allows for inquiries, but the information available is summarized (or aggregated), i.e., What are the total sales for a whole department? What is the best selling product?

Processing CycleDatabase Maintenance TPS helps ensure the databases are up-

to-date and correct. TPS can control multiple tables/databases A single purchase

decreases quantity – Inventory Tables decrease credit – Credit Card DB (other

company) increase sales – Sales Tables

Transaction Processing Cycle

Value of TPS Online Transaction Processing

(OLTP) Real-time systems, immediate

feedback Real-time Reports and databases

updates

Enterprise Collaboration Systems Also Cross-functional

crosses different functional business areas (accounting, finance, inventory management, human resources, etc.)

Systems include: Instant Messaging to Video Conferencing Lotus Notes (IBM) Outlook (Microsoft)

Enterprise Collaboration Systems (ECS)

Communicate :sharing information with each other.

Coordinate: coordinating individual work efforts and share resources with each other.

Collaborate: working together cooperatively on joint projects and assignments

Value of ECS Operational employees can work

together more Easily and Effectively Avoid traveling (telephone or video

conferencing) Enhanced coordination (document

merging, calendaring, scheduling, workflow systems)

Enhanced collaboration (project management tools, discussion forums, instant messaging, etc.)

ECS Tools

Other Forms of ECS Blog Spheres such as MySpace are

ECS’s for non-business communication

Blackboard is technically an ECS Content or Document Management

Systems Centralize content and documents for

the website.

Marketing Systems Interactive Marketing Sales Force Automation Customer Relationship Management Market Research and Forecasting Advertising and Promotion Product Management Sales Management

Marketing Systems

Interactive Marketing Customer-focused marketing process that is

based on using the Internet, intranets, and extranets to establish two-way transactions between a business and its customers or potential customers

Goal: Use networks to attract and keep customers

who will become partners with the business in creating, purchasing, and improving products and services

Targeted Marketing Tool for developing advertising and

promotion strategies to strengthen a company’s e-commerce initiatives, as well as its traditional business venues Community

customize advertising to appeal to people of specific virtual communities

Content advertising placed on a variety of

selected websites

Targeted Marketing Components

Targeted Marketing Components Context

advertising placed on web pages that are relevant to the content of a product or service

Demographic/Psychographic web marketing efforts aimed at specific types

or classes or people Online Behavior

promotion efforts tailored to each visit to a site by an individual

Sales Force Automation Information systems that improve the

delivery of information and support to salespeople with the goal of improving sales productivity and marketing responsiveness

Manufacturing Systems Information systems that support the

production/operations function that includes all activities concerned with the planning and control of the processes producing goods and services

Manufacturing Systems This is where we see the use of

process control systems. From petroleum processing to toy

manufacturing CAM: Computer Aided Manufacturing CIM: Computer Integrated

Manufacturing

Manufacturing Systems

Computer-Integrated Manufacturing (CIM)

Simplify production processes, product designs, and

factory organization as a vital foundation to automation and integration

Automate production processes and the business functions

that support them with computers, machines, and robots

Integrate all production and support processes using

computer networks, cross-functional business software, and other information technologies

Computer Integrated Manufacturing (CIM) Simplify production processes.

Re-engineer vs. gradual improvement. Automation – robotics, artificial

intelligence Integrate production process with

other systems: Order processing, inventory control, finance systems.

CIM Systems Computer-aided manufacturing (CAM)

Information systems that automate the production process

Manufacturing execution systems (MES) performance monitoring information

systems for factory floor operations Process Control

control ongoing physical processes Machine Control

controls the actions of machines

HRM and the Internet Recruiting employees through

recruiting services and databases on the World Wide Web

Posting messages in selected Internet newsgroups

Communicating with job applicants via e-mail

Human Resource Systems

Human Resource Management (continued)

F

HRM and Corporate Intranets

Process common HRM applications Allow HRM department to provide around-

the-clock services Disseminate valuable information faster

than through previous company channels Collect information from employees online Allow managers and other employees to

perform HRM tasks with little intervention by the HRM department

Accounting Information Systems They record and report business

transactions and other economic events Computer based accounting systems record

and report the flow of funds through an organization on historical basis and produce important financial statements such as balance sheets and income statements and financial budgets.

Accounting systems

Accounts payable

Accounts receivable

Control Program General Ledger Sales order processing

Data entry View all receipts Print receipts

Print review Print option dialog Send to printer

Working Breakdown Structure for an accounting systems

Accounting Information Systems

Accounting (continued)

Common Business Accounting Systems

Order Processing Captures and processes customer orders and

produces data for inventory control and accounts receivable

Inventory Control Processes data reflecting changes in inventory and

provides shipping and reorder information Accounts Receivable

Records amounts owed by customers and produces customer invoices, monthly customer statements, and credit management reports

Common Business Accounting Systems

Accounts Payable Records purchases from, amounts owed to, and

payments to suppliers, and produces cash management reports

Payroll Records employee work and compensation

data and produces paychecks and other payroll documents and reports

General Ledger Consolidates data from other accounting

systems and produces the periodic financial statements and reports of the business

Accounting and Finance Systems What is really the difference

between accounting and finance?

Investment Management

101 2

50%50%1. Accounting2. Finance

Cash flow forecasting

101 2

50%50%1. Accounting2. Finance

Payroll

101 2 3 4

25% 25%25%25%1. Accounting2. Finance3. HR4. Accounting

mostly but some HR

Order processing

101 2

50%50%1. Accounting2. Finance

Financial Management Systems

Finance (continued)

Financial Management Systems Capital Budgeting

evaluating the profitability and financial impact of proposed capital expenditures

Financial Planning evaluating the present and projected

financial performance of a business

Financial Management Systems Cash Management

Cash management systems collect information on all cash receipts and disbursement within a company on a real time or periodic basis.

Online Investment Management Online Investment Management services help

a financial manager make buying, selling, or holding decisions for each type of security so that an optimum mix of securities is developed that minimizes risk and maximizes investment income for the business.

Functional Business Systems A complete

accounting system may have some of the characteristics of an MIS, TPS, and DSS.

A complete marketing system may combine an MIS, ECS, TPS, and DSS

Marketing Information Systems

Interactive Marketing

Sales Force Automation

Customer Relationship Management

Sales Management

Product Management

Market Research and Forecasting

Advertising and Promotion

TPS

MIS

ECS

DSS

Summary Major e-business applications are integrated

cross-functional enterprise systems such as enterprise resource planning (ERP), customer relationship management (CRM), and supply chain management (SCM).

Enterprise application integration (EAI) systems interconnect other information systems so that business professionals can more easily access the information resources they need to support the needs of customers, suppliers, and business partners.

Summary Transaction processing involves the basic

activities of data entry, transaction processing, database maintenance, document and report generation, and inquiry processing.

Functional business information systems support the business functions of marketing, production/operations, accounting, finance, and human resource management through a variety of e-business operational and management information systems.

Summary Marketing information systems support

traditional and e-commerce processes and management of the marketing function.

Computer-based manufacturing information systems help a company achieve computer-integrated manufacturing, and thus simplify automate, and integrate many of the activities needed to quickly produce high-quality products to meet changing customer demands.

Summary Human resource information systems

support human resource management in organizations including staffing, training and development, and compensation administration.

Accounting information systems record, report and analyze business transactions and events for the management of the business enterprise.