OMIS 3500 Test 3

Y. Monistere

What does ERP System stand for?

Enterprise Resource Planning System

ERP System

Collects data from many divisions of firm for use in nearly all of firm’s internal business activities

• info entered into one process is immediately available for other processes

Basis of ERP System

Based on a suite of integrated software models and a common central database

ERP software is built around what?

Thousands of predefined business processes that reflect best practices

ERP helps with what?

Finance and accounting, Human Resources, manufacturing and production, sales and marketing

Business value of ERP

• increased operational efficiency

• provide firm-wide information to support decision making

• enable rapid responses to customer requests for information or products

• include analytical tools other than evaluate overall organizational performance and improve decision-making

AI and ERP Systems

• Vendors are increasingly incorporating AI

• Now include natural language processing capabilities 

• Can identify patterns in very large volumes of data

Best practices

To proven methods, techniques, and guidelines that are the most efficient and effective way to achieve a goal

SCM Systems

Network of organizations and processes for:

• procurring materials

• transforming materials into products

• distributing the products

Upstream supply chain

Includes the company’s primary, tier 2, and tier 3 and the processes for managing relationships with them

Internal supply chain

Process for transforming materials, components, and services that their suppliers furnish  into finished products or intermediate products for their customers and for managing materials and inventory

Downstream supply chain

Portion consists of the organizations and processes for distributing and delivering the products to the final customers

Just-in-time strategy

 A scheduling system for minimizing inventory by having components arrive exactly at the moment they are needed and finished goods shipped as soon as they leave the assembly line

• arrive as needed

Safety stock

Buffer to deal with a lack of flexibility and uncertainties in the supply chain

Bullwhip effect

A distortion of information about the demand for a product as it passes from one entity to the next across the supply chain

Business value of SCM Systems

• match supply to demand

• reduce inventory levels 

• improve delivery service

• speed product time to market

• use assets more effectively (can be 75% of budget)

• increase sales

Global supply chain issues

• geographical distances, time differences

• participants from different countries (different performance standards and legal requirements)

Internet helps manage global complexities

• warehouse management

• transportation management 

• logistics

• outsourcing

AI and SCM

• very useful for analyzing the proliferating amount of big data generated by modern global supply chains

• to develop more accurate forecasts

• reveal operational insights

• improve efficiency of storage and transportation processes across vast logistics networks with multiple partners

What does CRM stand for?

Customer relationship management

Function of CRM

• captures and integrates customer data from all over the organization

• consolidates and analyzes customer data

• distributes customer information to various systems and customer touch points across enterprise

• provides a single enterprise view of customers

Components of CRM

Marketing, customer service, and sales force automation

Sales force automation of CRM

• sales prospect and contact information

• sales quote generation capabilities

Customer service of CRM

• assigning and managing customer service requests

• web-based self-service capabilities

Marketing of CRM

• capturing prospect and customer data, scheduling and tracking direct-marketing mailings or e-mail

• cross-selling

Business value of CRM

• increased customer satisfaction

• reduced direct-marketing costs

• more effective marketing

• lower costs for customer acquisition/retention

• increased sales revenue

Churn Rate

Number of customers who stop using or purchasing products or services from a company

CRM and AI

• used to automate, enhance, and optimize CRM processes

• enables businesses to analyze vast amounts of customer data in real time

E-commmerce

The use of the internet and the web, and mobile apps and browsers running on mobile devices, to transact business

• digitally enabeled commerical transactions between and among organizations and individuals

Marketspace

Virtual selling

Marketplace

Physical location

8 Unique features of e-commerce

• Ubiquity

• Global reach

• Universal standards

• Richness

• Interactivity

• Information density

• Personalization/Customization

• Social technology

Ubiquity

• marketspace is virtual

• transaction costs reduced

Global reach

• transactions cross cultural and national boundaries

Universal standards

• technical standards of the Internet are universal standards

• lower market entry costs

Richness

The complexity and content of a message (text, audio, and visual)

Interactivity

Devices allow for 2-way communivation between merchant and consumer and peer-to-peer communication among individuals

Information density

Total amount and quality of information available to all market participants, consumers, and merchants alike

• price transparency

• cost transparency

• price discrimination

Personalization/customization

• when merchants target their marketing messages to specific individuals by adjusting the message to fit their algorithm

• changing delivered product or service based on a user’s preference or prior behavior

Social technology

Promotes user content generation and social networking

Digital markets and digital goods

Changed the way companies conduct business

Reductions due to digital markets/goods

• menu, search, and transaction costs

• information asymmetry

Dynamic Pricing

Enabled because of digital markets/goods

Benefits of disintermediation

Felt by customers due to digital markets/goods

Digital good

A good that is delivered over the internet and not shipped, its part of the digital market

3 types of e-commerce business models

Business to Consumer (B2C) 

Business to Business (B2B)

Consumer to Consumer (C2C)

Examples of B2C e-commerce

Walmart, Amazon, Apple Music

Example of B2B e-commerce

Grainger

Examples of C2C e-commerce

eBay, Craigslist

E-commerce revenue models

Advertising

Sales

Subscription

Free/Freemium

Transaction fee

Affiliate

Advertising revenue model

Revenue model based on generating revenue from online advertising

Sales revenue model

Revenue model based on generating revenue from the sale of goods, content, and/or services to customers

Subscription revenue model

Revenue model based on generating revenue from subscription fees charged for access to some or all of a company’s content or services

Free/Freemium revenue model

Basic services or content for free but generate revenue from a premium charged for advanced or special features

Transaction fee revenue model

Revenue model based on generating revenue from fees for enabling or executing transactions

Affiliate revenue model

A business steers customers to an “affiliate” which then pays the company a referral fee or commission