E-Business is About Business

Business
Driving IT

E-Business

IT Driving
Business
 Global reach
 Reduced cost
 Convenience
 Higher productivity and efficiency

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 Business E Commerce
Information
Management

E Business

Supply Chain
Customer
Management
Enterprise Relationship
Resource Management
Management
Internal business systems:
 Customer relationship Management
 Enterprise resource planning
 Document Management systems
 Human resources Management
Enterprise communication and collaboration
 VoIP
 Content management system
 E-mail
 Voice mail
 Web conferencing
 Business process Management
Electronic commerce
 Internet shop
 Supply chain Management
 Online marketing
 Offline marketing
 To create fundamental changes in business
processes
 To enable fast responses and agile maneuvering
 To negotiate more effectively with suppliers
 To create competitive advantage
 To provide instant access to global markets
 To lower costs
 To enable the convergence of voice, data and video
 To use the e-business as a key to business
operations

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 Building customer loyalty
 Achieving market leadership
 Streamlining business processes
 Creating new products/services
 Ascertaining compliance
 Reaching new markets

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 Personalize relations
 Maintain visitor privacy
 Make your site easy to use
 Manage visitor perceptions
 Maintain site consistency
 Manage business knowledge
 Response quickly

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 Transactions…
› A transaction is a record of an event that signifies a business
exchange
› Basic business operations such as customer orders, purchase
orders, receipts, time cards, invoices, and payroll checks in an
organization

Transaction processing systems (TPS)

A transaction processing system is a basic business system
that support the functions of
• Recording
• Monitoring
• Evaluating
the basic activities of the business
Transaction Processing Systems
Examples of basic manufacturing/production systems are:
 materials purchasing

 receiving
 shipping
 process control
 numerical control
 equipment
 quality control
 labor costing
 robotic systems
Examples of basic sales/marketing systems are:
 sales

 telemarketing
 order processing
 point-of-sales systems
 credit authorization
Amazon.com Order Processing System
 Electronic communication consist of three basic
components, a transmitter, a communication channel
(medium), and a receiver. Messages are converted to
electrical signals and sent over electrical or fiber-optic
cable or free space to a receiver.
Types of Electronic Communication
 • E-mail
 • Podcasting
 • Discussion Boards
 • Blogs
 • Text Messaging
 • Chatting, etc.
 The use of internet applications as a tool for on-line
discussion, content sharing, collaboration and presentation
 Example of these tools are E-Groups, E-Bulletin, Forums and
Online Office and Collaboration Tools
 These tools are also used for storing online content such as
videos, documents and different types of files
 You don’t have to bring any storage devices to bring your
important documents or files with you, just connect to the
internet to open your files
 IS that aid in planning, promotions and
sale of existing products in existing
markets
Interactive Marketing – customer-focused
two-way transactions between a firm and
its (potential) customers
Sales Force Automation – connect the sales
force to the Internet, intranets, and
extranets
 Targeted Marketing – advertising/promotion
concept that includes:
 Community – the group of people interested in
the product
 Content – the message aimed at the community
 Context – relevant/related to the target
audience
 Demographic/Psychographic – aimed only at
specific types/classes of people
 Online Behavior – track a person’s online
behavior so the advertising can be targeted to
the individual
Marketing IS
Support Major
Components of the
Marketing Function

Major Components of
Targeted Marketing
 What slowed the sales process for
adidas?
 Why is real-time access to inventories
important?
 What was the solution to this problem?
 How expensive was the solution?
 Support the production/operations function
 Computer-Integrated Manufacturing
Goal: to create flexible, agile, manufacturing processes that
efficiently produce highest quality products
3 Objectives:
Simplify (reengineer) production processes
Automate – with computers, machines, robots
Integrate – tie together all production and support
processes with networks, cross-functional software,
and other IT
 Computer-Aided Manufacturing – automate the
production process
 Manufacturing Execution Systems –monitor
performance
 Process Control – control ongoing physical
processes
 Machine Control – use of computers to control
machines
Manufacturing IS Support Computer-Integrated
manufacturing
 Human Resource Information Systems (HRIS)
support:
 Planning to meet personnel needs
 Development employee to their full potential
 Control personnel policies and programs
 HRM and the Internet – Internet is a major force for
change in HRM
 HRM and Corporate Intranets – Intranets allow firms
to provide services to customers and employees
 Why was this question difficult for
Chiquita?
 Why was this question difficult for
their Information Systems to answer?
 What benefits does the new systems
provide?
 The oldest and most widely used IS in business;
emphasize legal/historical record keeping accurate
financial statements
 6 operational accounting systems:
 Order Processing – capture/process orders, create data for
inventory control and accounts receivable
 Inventory Control – process data reflecting changes in
inventory, provides shipping/reorder information
 Accounts Receivable – record amounts owed by customers,
produce customer invoices/statements and credit
management reports
 6 operational systems:
 Accounts Payable – record purchases from, amounts
owed to, and payments to suppliers, and produce cash
management reports
 Payroll – record employee work and compensation data,
produce paychecks and payroll documents
 General Ledger – consolidate data from other accounting
systems, produce periodic financial statements and
reports

 Online Accounting Systems – interactive, directly involved

in processing business transactions
Note How Accounting Systems Are Related to Each Other
 Support decisions concerning:
 Financing a business – determine financing needs
 Allocation and control of financial resources

 Capital Budgeting – evaluate profitability and financial impact

of proposed capital expenditures

 Financial Planning – evaluate present and projected financial

performance
 Decision support can be provided in many different
configurations
 These configurations depend on
› the nature of the management-decision situation, and
› the specific technologies used for support
 These technologies are assembled from four basic
components
› Data
› Models
› User interface
› Knowledge (optional)

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 Decision support systems are a class of
computer-based information systems
including knowledge based systems that
support decision making activities.
 A DSS program is build for a specific purpose
› e.g. a scheduling system for a company
 Typically built to
› support the solution of a problem
› evaluate an opportunity
 An approach (or methodology) for sup-porting decision making
 A DSS supports all phases of decision making
› may include a knowledge component
 Can be used by a single user on a PC
 Can be Web-based for use by many people at several locations

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 Business analytics
› The application of models directly to business data
 It involves using DSS tools, especially models, in
assisting decision makers
 It is essentially OLAP/DSS
 Predictive analytics
› A business analytical approach toward forecasting
› e.g., demand, problems, opportunities
› that is used instead of simply reporting data as they occur

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 Support for decision makers
 mainly in semi-structured and unstruc-tured situations
 by bringing together human judgment and computerized
information
 Support for all managerial levels
 ranging from top executives to line managers
 Support for individuals and groups
 Support for interdependent and/or se-quential decisions
 Support in all phases of the decision-making process
 Support for a variety of decision-making processes and
styles

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 DSS are flexible
› users can add, delete, combine, change, or rearrange basic
elements
 DSS can be readily modified to solve other similar
problems
 User-friendliness
› strong graphical capabilities
› a natural language interactive human–machine interface can
greatly increase the effectiveness of DSS
 Improved effectiveness of decision making
› e.g. accuracy, timeliness

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 Decision maker has complete control over all steps
of decision-making
 End users are able to develop and modify simple
systems by themselves
 Models are generally utilized to analyze decision-
making situations
› models enable experimentation

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› Data Management Subsystem
› Model Management Subsystem
› User Interface (Dialog) Subsystem
› Knowledge-based Management Subsys-tem
› User
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 Data Mining
› The use of software to extract previously unknown,
unsuspected, and potentially useful information
from data
 Online Analytical Processing
› Software allows users to analyze multi-
dimensional data easily and quickly

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 Geographic Information Systems (GIS)
› Software that simplifies the analysis and
visualization of information about entities whose
physical location is important
 Simulation
› The use of analytic models for representing real
processes

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 Optimization
› Goal-seeking software that can quickly narrow the
best choices to one or a few
 Statistical software
› Assist managers in drawing inferences about the
relationships among data elements and assessing
the extent to which they reflect underlying
processes rather than random occurrences

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 Expert Systems
› A type of artificial intelligence software that
captures and applies the collective wisdom of
experts in a particular field to help make decisions

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 Business Intelligence
› A combination of processes and tools for
increasing a business’s competitive advantage by
using data intelligently to make better, faster
decisions

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 Knowledge management
› Knowledge acquisition and creation
› Institutional memory
 The collective shared memory of an organization
› Knowledge retrieval and transfer
 Occurs informally through social interaction

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 Competitive Intelligence
› The collection, management, and use of
information about competitive organizations

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 Using Organizational Knowledge
› Management Reporting Systems
 Detail reports: Provide managers information useful
in overseeing the day-to-day operations of a
department or working group
 Summary reports: Show totals, averages, maximums,
minimums, or other statistical data aggregated over
time, personnel, products, or some other quantity

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 Using Organizational Knowledge
› Management Reporting Systems
 Exception reports: Alert managers to potential
problems by showing only data that fall outside an
accepted or expected range

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 EIS, also called Executive Support Systems
(ESS) resemble decision support systems, but
respond to the particular requirements of top-
level managers

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 Typical features
› Sophisticated, easy-to-use, graphical interface with
drill-down capability
› Groupware features, including calendaring
systems, electronic mail, and electronic bulletin
boards, to communicate with employees
› News updates from external sources, screened and
ranked per executive interest

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 Typical features
› Access to OLAP and canned queries
› Access to functional applications, such as sales,
budgeting, and marketing

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