st bdis4e_ch08_ppt.pdf

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2014 by McGraw -Hil l Education. This is proprietary mater ial solely for autho rized instructor

use. Not author ized for sale or dis t r ibut ion in any manner . This document m ay not be c opied,scann ed, duplic ated, forward ed, distr ib uted, or posted on a website, in whole or part.

CHAPTER EIGHT

ENTERPRISEAPPLICATIONS

BUSINESSCOMMUNICATIONS


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CHAPTER OVERVIEW

SECTION 8.1Enterprise Systems and Supply

Chain Management

Building a Connected Corporation Through Integrations

Supply Chain Management

The Benefits of SCM

The Challenges of SCM

The Future of SCM


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CHAPTER OVERVIEW

SECTION 8.2Customer RelationshipManagement and Enterprise ResourcePlanning

Customer Relationship Management The Benefits of CRM

The challenges of CRM

The Future of CRM

Enterprise Resource Planning The Benefits of ERP

The challenges of ERP

The Future of Enterprise Systems, Integrating SCM,

CRM, and ERP


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SECTION 8.1

EnterpriseSystems and

Supply ChainManagement


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LEARNING OUTCOMES

1. Explain integrations and the role they play in

connecting a corporation

2. Describe supply chain management along

with its associated benefits and challenges


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BUILDING A CONNECTED CORPORATION

THROUGH INTEGRATIONS

IntegrationAllows separatesystems to communicate directly

with each other, eliminating theneed for manual entry into multiplesystems Forward integration

Backward integration


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Integration Example


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A Central Information Repository Example


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Integration Tools

Enterprise systemProvide

enterprisewide support and

data access for a firms

operations and business

processes

Enterprise application

integration (EAI)Connectsthe plans, methods, and tools

aimed at integrating separate

enterprise systems


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Integration Tools

MiddlewareSeveral different types

of software that sit between and

provide connectivity for two or more

software applications

Enterprise application integration

middlewareTakes a new approach

to middleware by packaging commonlyused applications together, reducing

the time needed to integrate

applications from multiple vendors


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Integration Tools

Three Primary Enterprise Systems


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SUPPLY CHAIN MANAGEMENT

Five basic supply

chain activities


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Supply Chain Management(SCM)The

management of information flows between and

among activities in a supply chain to maximize total

supply chain effectiveness and profitability


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The supply chain has three main links

1. Materials flow from suppliers and their

upstream suppliers at all levels2. Transformation of materials into

semifinished and finished products

through the organizations own production

process

3. Distribution of products to customers and

their downstream customers at all levels


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Supply Chain Example


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Walmart and Procter & Gamble SCM Example


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Effective and efficient SCM systems can enable

an organization to

Decrease the power of its buyers

Increase its own supplier power

Increase switching costs to reduce the threat of

substitute products or services

Create entry barriers thereby reducing the threat ofnew entrants

Increase efficiencies while seeking a competitive

advantage through cost leadership


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Effective and Efficient SCM Systems

Effect on Porters Five Forces


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THE BENEFITS OF SCM:

Improved Visibility Supply chain visibilityThe ability to view all areas

up and down the supply chain in real time

Supply chain planning systemUses advancedmathematical algorithms to improve the flow and

efficiency of the supply chain while reducing inventory

Supply chain execution systemAutomates the

different activities of the supply chain

Bullwhip effectOccurs when distorted product

demand information ripples from one partner to the

next throughout the supply chain


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Improved Visibility

Supply Chain Planning and Execution


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Improved Profitability Companies can respond faster andmore effectively to consumer

demands through supply chain

enhances

Demand planning system

Generates demand forecasts using

statistical tools and forecastingtechniques, so companies can

respond faster and more effectively to

consumer demands through supply

chain enhancements

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Improved Profitability Common supply chain metrics include:

Back order

Inventory cycle time

Customer order cycle time

Inventory turnover

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THE CHALLENGES OF SCM

Primary challenges include

CostAn SCM system can cost millions of dollars

for the software and millions more for helpimplementing the system

Complexity- The move towards globalization is

increasing complexity in the supply chain

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THE FUTURE OF SCM

Fastest growing SCM components

Collaborative demand planning

Collaborative engineering

Selling chain management

Supply chain event management (SCEM)

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SECTION 8.2

CustomerRelationshipManagement

andEnterpriseResourcePlanning

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LEARNING OUTCOMES

3. Describe customer relationship management

along with its associated benefits and

challenges

4. Describe enterprise resource management

along with its associated benefits and

challenges

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CUSTOMER RELATIONSHIP

MANAGEMENT

Customer relationship management (CRM)

Involves managing all aspects of a customers

relationship with an organization to increase

customer loyalty and retention and anorganization's profitability

Many organizations, such as Charles Schwab and

Kaiser Permanente, have obtained great successthrough the implementation of CRM systems

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CUSTOMER RELATIONSHIP

MANAGEMENT

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THE BENEFITS OF CRM

Organizations can find their most

valuable customers through RFM

- Recency, Frequency, and

Monetary value How recentlya customer purchased

items

How frequentlya customer purchased

items

The monetary value of each customer

purchase

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Evolution of CRM

CRM reporting technologyHelp organizations

identify their customers across other applications

CRM analysis technologiesHelp organization

segment their customers into categories such as

best and worst customers

CRM predicting technologiesHelporganizations make predictions regarding

customer behavior such as which customers are

at risk of leaving

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Evolution of CRM

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Operational and Analytical CRM

Operational CRMSupports

traditional transactional processing for

day-to-day front-office operations or

systems that deal directly with thecustomers

Analytical CRMSupports back-

office operations and strategicanalysis and includes all systems that

do not deal directly with the customers

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Marketing and operational CRM technology

List generator, campaign management, cross-selling

and up-selling

Sales and operational CRM technology

Sales management, contact management,

opportunity management

Customer service and operational CRM

technology

Contact center, Web-based self-service, call scripting

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Marketing and Operational CRM

Threemarketing operational CRMtechnologies

1. List generator

2. Campaign management system3. Cross-selling and up-selling

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Sales and Operational CRM

The sales department was the first to begin

developing CRM systems with sales force

automation a system that automatically tracks all

of the steps in the sales process

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Sales and Operational CRM

Sales and operational CRM technologies

1. Sales management CRM system

2. Contact management CRM system

3. Opportunity management CRM system

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Customer Service and

Operational CRM Three customer service operational CRM

technologies

1. Contact center (call center)

2. Web-based self-service system

3. Call scripting system

Common features included in contact centers

Automatic call distribution

Interactive voice response

Predictive dialing

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Analytical CRM

Website personalizationOccurs when a

website has stored enough data about a persons

likes and dislikes to fashion offers more likely to

appeal to that person Analytical CRM relies heavily on data warehousing

technologies and business intelligence to glean

insights into customer behavior

These systems quickly aggregate, analyze, and

disseminate customer information throughout an

organization

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THE CHALLENGES OF CRM

The customer is

always right and

now has more

power than ever

thanks to the

Internet

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THE FUTURE OF CRM

Current trends include

Supplier relationship management

(SRM)

Partner relationship management

(PRM)

Employee relationship

management (ERM)

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ENTERPRISE RESOURCE

PLANNING

Enterprise resource planningIntegrates all

departments and functions throughout an

organization into a single IT system (or

integrated set of IT systems) so that employeescan make enterprisewide decisions by viewing

enterprisewide information on all business

operations

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ENTERPRISE RESOURCE

PLANNING

Reasons ERP systems are

powerful tools

ERP is a logical solution toincompatible applications

ERP addresses global information

sharing and reporting

ERP avoids the pain and expense

of fixing legacy systems

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ENTERPRISE RESOURCE

PLANNING ERP systems collect data from across anorganization and correlates the data generating

an enterprisewide view

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ENTERPRISE RESOURCE

PLANNING

ERP Systems Automate Business Processes

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ENTERPRISE RESOURCE

PLANNING

The Organization Before ERP

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ENTERPRISE RESOURCE

PLANNING

ERP Bringing The Organization Together

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THE BENEFITS OF ERP

Core ERP componentTraditional

components included in most ERP systems and

they primarily focus on internal operations

Extended ERP componentExtra

components that meet the organizational needs

not covered by the core components and

primarily focus on external operations

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THE BENEFITS OF ERP

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THE BENEFITS OF ERP

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Core ERP Components

Three most common core ERP

components

1. Accounting and finance

2. Production and materials management

3. Human resource

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Accounting and Finance ERP Components

Accounting and finance ERP component

Manages accounting data and financial

processes within the enterprise with functions

such as general ledger, accounts payable,accounts receivable, budgeting, and asset

management

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Production and Materials Management ERP

Components

Production andmaterialsmanagement ERP

componentHandlesthe various aspects ofproduction planning andexecution such asdemand forecasting,production scheduling,

job cost accounting,and quality control

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Human Resource ERP Component

Human resource ERP componentTracks

employee information including payroll, benefits,

compensation, performance assessment, and

assumes compliance with the legalrequirements of multiple jurisdictions and tax

authorities

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Extended ERP Components

Extended ERP components include:

Business intelligence

Customer relationship management

Supply chain management

Ebusiness components include

Elogistics

Eprocurement

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Measuring ERP Success

Balanced scorecardEnables organizationsto clarify their vision and strategy and translatethem into action

Balanced scorecard views the organization fromfour perspectives

Learning and growth

Internal business process

Customer

Financial

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Measuring ERP Success

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THE CHALLENGE OF ERP

ERP systems contain multiple complex

components that are not only expensive to

purchase, but also expensive to implement

Costs include

Software

Consulting fees

Hardware expenses

Training fees

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THE FUTURE OF ENTERPRISE SYSTEMS:

INTEGRATING SCM, CRM, AND ERP

SCM, CRM, and ERP are the

backbone of ebusiness

Integration of these applications isthe key to success for many

companies

Integration allows the unlocking of

information to make it available to

any user, anywhere, anytime

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SCM, CRM, and ERP Integration

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LEARNING OUTCOME REVIEW

Now that you have finished the chapter

please review the learning outcomes in

your text

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