Module III Electronic Businessfaculty.tamucc.edu/hormozi/MISY3310/Chap007/chap007.pdf · 1 END BACK NEXT Enterprise Business Systems Enterprise Resource Planning Supply Chain Management

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Enterprise Business SystemsEnterprise Resource PlanningSupply Chain ManagementTransaction Processing SystemsSection IIFunctional Business SystemsIT in BusinessMarketing SystemsHuman Resource SystemsAccounting SystemsFinancial Mgmt.

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Copyright 2005, McGraw-Hill/Irwin, Inc. 7-1

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Electronic Electronic Business Business SystemsSystems

Enterprise Business Systems

Module III – Business Applications

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Learning ObjectivesLearning Objectives1. Identify the following cross-functional

enterprise systems and give examples of how they can provide significant business value to a company.

a) Enterprise resource planningb) Customer relationship managementc) Supply chain managementd) Enterprise application integratione) Transaction processing systemsf) Enterprise collaboration systems

2. Give examples of 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.

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Enterprise Enterprise Business SystemsBusiness Systems

• e-Business Applications• e-Commerce• Cross-functional Enterprise

Systems• Customer Relationship

Management• Enterprise Resource Planning• Supply Chain ManagementReal World Real World Case 1Case 1--

Salesforce.ComSalesforce.ComClick to go to

Case 1END

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Real World Cases

CustomerFeedback

MarketResearch

MarketTest

ComponentDesign

ProductTest

ProductRelease

ProcessDesign

EquipmentDesign

ProductionStart

Marketing R&D/Engineering Manufacturing


New Product New Product Development ProcessDevelopment Process

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Suppliers

Customers

Empl

oyee

s

Part

ners

Supply Chain ManagementSourcing - Procurement

Enterprise Resource PlanningInternal Business Processes

Customer Relationship ManagementMarketing – Sales - Service

Kno

wle

dge

Man

agem

ent

Col

labo

ratio

n –

Dec

isio

n Su

ppor

t

Part

ner R

elat

ions

hip

Man

agem

ent

Selli

ng –

Dis

trib

utio

n

Enterprise Application ArchitectureEnterprise Application Architecture


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•Created Real-time Configure-to-Order System•Enterprise e-Business Systems Need End-to-

End Connectivity:– Across Different Processes– From Legacy Systems to its Suppliers,

Customers and Partners•Orders by Customers Travel Great Global

Distances •Systems Update Order Status•Communicate with Other Systems-Real Time•Orders Zip Across Atlantic Average 4 Times


IBM Corporation: Global CrossIBM Corporation: Global Cross--Functional Enterprise SystemsFunctional Enterprise Systems

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ProductionPlanning Integrated

Logistics

Accounting and Finance

HumanResources

Sales,Distribution,

OrderManagement

Customer/Employee

Enterprise Enterprise Resource PlanningResource Planning

The Technological Backbone The Technological Backbone of eof e--BusinessBusiness

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ColgateColgate--Palmolive: The Palmolive: The Business Value of ERPBusiness Value of ERP

• Use of Software across the Entire Spectrum of the Business

• Activities That Once Took Days now Take Hours

• On-Time and Correctness of Deliveries Improved Significantly

• Inventories Reduced by 1/3 and Realized Meaningful Cost Savings

GraphicallyGraphically……

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Supp

liers

Human ResourcesFinance and Accounting

DemandPlanning

ManufacturingPlanning

LogisticsPlanning

DistributionPlanning

OrderEntry

Enterprise Resource Planning

Cus

tom

ers

Purchasing& Accounts

Payable

MRPInbound

InventoryPlant Mgmt.

Manufacturing& ProductionScheduling

InventoryControl &

Warehousing

Distribution& AccountsReceivable


ColgateColgate--Palmolive: The Palmolive: The Business Value of ERPBusiness Value of ERP

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Benefits of ERP•Quality and Efficiency•Decreased Costs•Decision Support• Enterprise AgilityFailures in ERP Do Exist


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• SAP AG’s Software Installation Problems of ERP Integrated Suite into a Retail Environment• Sobey’s Grocer Had Problems

with Number of Transactions• Jo-Ann Stores and Petsmart

Blamed Software for Poor Financial Performance• Sobey’s is Replacing System


Sobeys Inc.: Failure in ERP Sobeys Inc.: Failure in ERP ImplementationImplementation

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Causes of ERP Failures• Underestimating the

Complexity of Planning, Development, and Training Needed • Failure to Involve Affected

Employees• Trying to do Too Much Too

Fast• Over Reliance by Company on

Claims of Software Companies


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Supports an Integrated and Supports an Integrated and Collaborative Relationship Between Collaborative Relationship Between a Business and ita Business and it’’s Customerss Customers

CRM: The Business FocusCRM: The Business Focus

CustomerLife Cycle

CRMFunctionalSolutions

CRMIntegratedSolution

The Internet

Acquire Enhance Retain

Direct Marketing Cross-sell and Up-sell Proactive Service

Sales Force Automation Customer Support

CollaborativeService

SharedCustomer Data

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CRM Uses IT to Create a CrossCRM Uses IT to Create a Cross--Functional Enterprise SystemFunctional Enterprise System


Marketing andFulfillment Customer

Service andSupport

Retentionand LoyaltyPrograms

Contact andAccount

Management

Sales•Cross-Sell•Up-Sell

Prospect orEmployee

Fax e-Mail

Telephone Web

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Telstra Corporation: The Telstra Corporation: The Business Value of CRMBusiness Value of CRM


• Provides Fixed, Wireless, and e-Commerce Services to Customer Base in 19 Countries

• Offers Voice, Data, Internet, Multimedia and Communications Services

• Sought CRM Solution to Integrate More than 20 Core Legacy Databases Across the System

• Benefits Quickly Followed• Reduced Training Time END

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CRM: The Business FocusCRM: The Business FocusBenefits and Challenges of CRM• Identify and Target the Best

Customers• Customization and Personalization

of Products and Services• Track Customer ContactsCRM Failures• 50% of Applications Fail to Meet

Expectations• 20% of the Time CRM Damaged

Customer Relationships• Lack of Understanding and

Preparation is Blamed

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Gevity HR and Monster.Com: Gevity HR and Monster.Com: Failures in CRM ImplementationFailures in CRM Implementation


• Employees Undercut the System Believing Their Jobs Threatened by CRM On-Line Customer Problem Solutions.• Complex Installation Since it

Touches So Many Legacy Systems• Failures Lead to Loss of

Customer Goodwill and Business and Negatively Affects Employees Also END

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SCM: The Business NetworkSCM: The Business NetworkSupply Chain Management• SCM – A Top Strategic

Objective for Many Firms• The Right Products• The Right Place• The Right Time• In the Proper Quantity• At an Acceptable Cost

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SCM: The Business NetworkSCM: The Business NetworkObjective of SCM

Efficiently Manages this Process by: • Forecasting Demand• Controlling Inventory• Enhancing Business

Relationships• Receiving Feedback and

Status of Every Link of the Chain END

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Moen Inc., and TaylorMade Golf: Moen Inc., and TaylorMade Golf: WebWeb--Enabling the Supply ChainEnabling the Supply Chain• Simultaneous Sharing of Designs

Worldwide with Suppliers• Design Problems Discovered

Instantly• Extranet Site Allows Suppliers to

Check Orders Online• Company has Saved $3 Million

or 6% off of Raw Material and Work-in-Progress Inventory Costs

SCM: The Business NetworkSCM: The Business Network

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SCM Software Helps Firms Reengineer and SCM Software Helps Firms Reengineer and Integrate The Functional SCM ProcessesIntegrate The Functional SCM Processes

Supply ChainLife Cycle

SCMFunctionalProcesses

SCMIntegratedSolution

Supplier Manufacturer CustomerRetailer

The Internet

CollaborativeFulfillment

SharedMarket Data

Commit Schedule Make Deliver

Strategic Sourcingand Procurement

Forecast and Demand Planning

Customer Order Fulfillment Service

Distribution Network and Warehouse OperationsTransportation and Shipment

ManagementProductionLogistics


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SCM: The Business NetworkSCM: The Business NetworkBenefits and Challenges of

SCM •More Accurate Order

Processing• Reductions in Inventory

Levels• Quicker Time to Market• Lower Costs• Strategic Relationships

with Suppliers

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Benefits and Challenges of SCM


• Lack of Proper Planning Knowledge, Tools, and Guidelines• Inaccurate Demand

Forecasts• Lack of Adequate

Collaboration• Software Itself Immature END

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Business Value GoalsRapid Demand Fulfillment

Collaborative SupplyChain Planning and

Execution

Customer Value GoalsGive customers what theywant, when and how theywant it, at the lowest cost

InterenterpriseCoordination of

Manufacturing andBusiness Process

EffectiveDistribution and

Channel PartnershipsResponsiveness and

Accountabilityto Customers

Objectives of Supply Chain Objectives of Supply Chain ManagementManagement


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Solectron Corp: Failures in SCMSolectron Corp: Failures in SCM• Software Can’t Compensate for

Business Judgment• Forecasts Driving Entire Flow of

Work is Concocted by People, Not Real-time Bits of Data• Solectron – World’s Biggest

Electronics Contract Maker• Supply Glut Was Brewing• Unrealized Overly Optimistic

Ordering Resulted in Suppliers Sending Excessive Materials Left Solectron Holding the Bag


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Enterprise Application Enterprise Application IntegrationIntegration

EAI Software Connects Major EAI Software Connects Major ee--Business Applications Like Business Applications Like CRM and ERPCRM and ERP

Front-OfficeCRM ApplicationsCustomer Service

Field ServiceProduct Configuration

Sales Order Entry

Back-OfficeERP Applications

DistributionManufacturing

SchedulingFinance

EnterpriseApplicationIntegration

EAI

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• Survey of 75 Related Companies Revealed 18 Different Software Packages

• Lack of Integration Reduces Cost and Speed Savings that Might Be Realized

• Use of WebMethods EAI to Coordinate Processes

• New System Generated Cost Savings• Orders for Product Automatically

Orders Parts


Dell Computer: Enterprise Dell Computer: Enterprise Application IntegrationApplication Integration

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Order Entry Method

EAI

Billing

Call Center

Finance

Orders &Fulfillment

Manufacturing

Routing

Shipping

e - Mail

Fax

Web

Mail

Phone


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Transaction Processing Transaction Processing SystemSystem

Capture and Process Transactions ImmediatelyCapture and Process Transactions ImmediatelyCable Company A Cable Company B

VideoServer

VideoServer

Host System Host System

InteractiveVoice Response

System

WebServers

FaxServers

San Francisco New York

CommunicationServers

DatabaseServers Application

ServersCommunication

Servers

Phone System The Internet

Syntellect Interactive Systems

Middleware

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• Used for Cable Pay-Per-View Events• Access by Phone or the

WWW• Database Captures,

Processes and Updates• Teams with over 700 Cable

Companies

SyntellectSyntellect’’s Online Transaction s Online Transaction ProcessingProcessing

Transaction Processing Transaction Processing SystemSystem

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Transaction Processing CycleTransaction Processing CycleCapture and Processing Data, Capture and Processing Data, Updating Databases, and Produce Updating Databases, and Produce Information Products Information Products

DataEntry

Documentand ReportGeneration

DatabaseMaintenance

InquiryProcessing

TransactionProcessing•Batch•Online/Real-Time

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Enterprise Collaboration Enterprise Collaboration SystemsSystems

ECS Enables Working Together by Helping Us to:•Communicate•Coordinate•CollaborateTools for Enterprise Collaboration…

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Tools for Enterprise CollaborationTools for Enterprise Collaboration

ElectronicCommunications

Tools

ElectronicConferencing

Tools

CollaborativeWork

ManagementTools

EnterpriseCollaboration

Systems

•e-Mail•Instant Messaging•Voice Mail•Faxing•Web Publishing•Paging

• Calendaring and Scheduling

• Task and Project Management

• Workflow Systems• Document Sharing• Knowledge Management

• Data Conferencing• Voice Conferencing• Videoconferencing• Discussion Forums• Chat Systems• Electronic Meeting

Systems


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QuickPlace by Lotus Development QuickPlace by Lotus Development Collaborative Software ScreenshotCollaborative Software Screenshot


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General Electric Co: Committed General Electric Co: Committed to Enterprise Collaborationto Enterprise Collaboration


•Committed to Lotus Tools –QuickPlace•QuickPlace-Web-based Work Spaces•Sametime (Real-time Online Meetings)•Tools Streamline Communication•18,000 QuickPlaces for 250,000 Users

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Functional Business Functional Business SystemsSystems

• Variety of Types of Information Systems that Support Business Functions• Identification of Business

Value Created• Analysis of Challenges to

ImplementationReal World Real World Case 2Case 2--GE Power and Corporate GE Power and Corporate

ExpressExpress Click to go toCase 2

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Functional Business Functional Business SystemsSystems

Examples of Examples of Functional Functional Business Business Information Information SystemsSystems

Marketing

ProductionOperations

Human ResourceManagement

Accounting Finance

• Customer relationship management

• Interactive marketing

• Sales force automation

• Cash management• Credit management• Investment

management• Capital budgeting• Financial forecasting

• Order processing• Inventory control• Accounts receivable• Accounts payable• Payroll• General ledger

• Compensation analysis

• Employee skills inventory

• Personnel requirements forecasting

• Manufacturing resource planning

• Manufacturing execution systems

• Process control FunctionalBusinessSystems

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Marketing SystemsMarketing SystemsMarketing Information Systems

MarketInformation

Systems

InteractiveMarketing

Sales ForceAutomation

CustomerRelationshipManagement

SalesManagement

MarketResearch andForecasting

Advertisingand Promotion

ProductManagement

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Marketing SystemsMarketing SystemsFive Major Components of Five Major Components of

Target MarketingTarget Marketing

OnlineBehavior Demographic/

Psychographic

Context

Content

Community

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Marketing SystemsMarketing SystemsSales Force AutomationSales Force Automation•Use of Computers and the Internet•Improves the Delivery of Information•Support for Sales People Provides a Strategic Advantage in Sales and Marketing Responsiveness

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Marketing SystemsMarketing SystemsBaker Tanks: WebBaker Tanks: Web--Based Based Sales Force AutomationSales Force Automation•Leader in Rentals of Industrial Containment•Foremost in Transfer Equipment•Serves Customers in Construction to Aerospace•Ineffective Access to Huge Data •Used Salesforce.com Web-based System - PDAs Connected for Data•Much Better Communication•Salespeople More Productive END

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Marketing SystemsMarketing SystemsWebWeb--Based Salesforce.com Based Salesforce.com Automation PackageAutomation Package

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Manufacturing SystemsManufacturing SystemsComputer-Integrated

Manufacturing (CIM)• Simplify• Automate• IntegrateFlexible Manufacturing SystemsAgile ManufacturingTotal Quality ManagementComputer-Aided Engineering

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Computer-Integrated Manufacturing

Ente

rpris

e R

esou

rce

Plan

ning

ManufacturingResources

Planning Systems

ManufacturingExecutionSystems

EngineeringSystems

ProductionForecasting

ProductionScheduling

MaterialRequirements

Planning

CapacityPlanning

ProductionCost Control

QualityControl

Shop FloorScheduling

Shop FloorControl

Machine Control

Robotics Control

Process Control

Computer-AidedEngineering

ProductSimulation and

Prototyping

Computer-AidedDesign

Computer-AidedProcess Planning

Manufacturing SystemsManufacturing Systems

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Manufacturing SystemsManufacturing SystemsThe Timken Co. WebThe Timken Co. Web--Based Based Manufacturing SystemsManufacturing Systems•Established "Electronic Visibility"•Used Global Supply Chain•Immediate Parts Location•Speed of Internet Combined With Global Logistics Management END

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Human Resources SystemsHuman Resources SystemsHuman Resource Information Systems•Recruitment, Selection, and Hiring•Job Placement•Performance Appraisals•Employee Benefits Analysis•Training and Development•Health, Safety, and SecurityHRM and the InternetHRM and Intranets

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SupportsSupports……Staffing Training and

DevelopmentCompensationAdministration

StrategicSystems

TacticalSystems

OperationalSystems

• Human resource planning

• Labor force tracking

• Labor cost analysis and budgeting

• Turnover analysis

• Recruiting• Workforce

planning/• scheduling

• Succession planning

• Performance appraisal planning

• Training effectiveness

• Career matching

• Skill assessment• Performance

evaluations

• Contract costing

• Salary forecasting

• Compensation effectiveness and equity analysis

• Benefit preference analysis

• Payroll control• Benefits

administration

Human Resources SystemsHuman Resources Systems

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An Example of an Employee An Example of an Employee Hiring Review SystemHiring Review System

Human Resources SystemsHuman Resources Systems

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Human Resources SystemsHuman Resources SystemsCharles Schwab & Co.: WebCharles Schwab & Co.: Web--Based Human Resource SystemsBased Human Resource Systems• 23,000 Employees Access

Detailed HR Data• Intranet Benefits

Employees Searches • Savings of Hundreds of

Thousands Yearly•Employees Use Online

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Accounting SystemsAccounting Systems• Record and Report Business

Transactions• Trace Flows of Funds

Through a Business• Produce Financial

Statements• Forecasts of Future

Conditions• Projected Financial

Statements• Financial Budgets

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Accounting SystemsAccounting SystemsAccounting Information Systems for Accounting Information Systems for Transaction Processing and Transaction Processing and Financial ReportingFinancial Reporting

Sales TransactionProcessing System

PurchasesTransactionProcessingSystem

PayrollTransactionProcessingSystem

General LedgerProcessing and

Reporting System

Billing AccountsReceivable

FinancialReporting

AccountsPayable

SalesAnalysis

Purchases

Time-keeping

Cash Receipts and Disbursements Transaction

Processing System

SalesOrder

Processing

CashDisburse-

ments

CashReceipts

GeneralLedger

InventoryProcessing

Payroll

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Accounting SystemsAccounting Systems

•Order Processing• Inventory Control•Accounts Receivable•Accounts Payable•Payroll•General Ledger

Examples of Widely Used Examples of Widely Used Accounting Information SystemsAccounting Information Systems

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Accounting SystemsAccounting SystemsAn OnAn On--line Accounting Reportline Accounting Report

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Financial Management Financial Management SystemsSystems

Support Business Decision Makers in:•Financing a Business•The Allocation and Control of Financial Resources

Capital BudgetingFinancial Planning Software

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Important Financial Management Important Financial Management SystemsSystems

CashManagement

InvestmentManagement

CapitalBudgeting

FinancialPlanning

• Forecast andManage cash position

• Manage short-term and other securities

• Evaluate risk/return of capital expenditures

• Forecast financial performance and financing needs

InformationSystems in

Finance


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Strategic Financial PlanningStrategic Financial Planning


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SummarySummary• Cross-Functional Enterprise

Systems• Enterprise Resource Planning

(ERP): The Business Backbone• Customer Relationship

Management: The Business Focus• Supply Chain Management: The

Business Network• Transaction Processing Systems• Functional Business Systems• Marketing• Manufacturing• Human Resource Management• Accounting and Finance

Documents

Module III Electronic Businessfaculty.tamucc.edu/hormozi/MISY3310/Chap007/chap007.pdf · 1 END BACK NEXT Enterprise Business Systems Enterprise Resource Planning Supply Chain Management