Processes, Organizations, and Information Systems / Enterprise Resource Planning (ERP)

Competitive Advantage with Information Systems

  • Achieving competitive advantage involves businesses defining strategies, creating processes, and developing information systems to support these processes.

Processes and Information Systems

  • Business Process: A network of activities that generate value by transforming inputs into outputs.
  • Structured Processes: Formal, standardized processes for day-to-day operations (e.g., accepting a return).
  • Dynamic Processes: Flexible, informal, adaptive processes for strategic decisions (e.g., opening a new store).

Information Systems Scope

  • Workgroup: Support one or more workgroup processes (10-100 users).
  • Enterprise: Support one or more enterprise processes (100-1,000+ users).
  • Inter-enterprise: Support one or more inter-enterprise processes (1,000+ users).

Improving Process Quality

  • Process Efficiency: Ratio of process outputs to inputs.
  • Process Effectiveness: How well a process achieves organizational strategy.

Information Silos

  • Problems: Data duplication, inconsistency, isolation, disjointed processes, lack of integrated information, and increased costs.
  • Solutions: Enterprise applications (CRM, ERP, EAI) on enterprise networks and distributed systems using Web service technologies.

Enterprise Systems (CRM, ERP, EAI)

  • Business Process Reengineering: Using integrated data and enterprise systems to create stronger linkages in value chains.
  • Customer Relationship Management (CRM): Manage interactions with customers through marketing, acquisition, relationship management, and loss/churn.
  • Enterprise Resource Planning (ERP): Integrate purchasing, HR, production, sales, and accounting data.
  • Enterprise Application Integration (EAI): Connects system “islands”, enables data sharing, and provides an integrated layer over existing systems.

Challenges of Implementing and Upgrading Enterprise Information Systems

  • Collaborative management, requirements gaps, transition problems, and employee resistance.

Inter-enterprise IS

  • Solve problems of enterprise silos by integrating data across multiple organizations.

ERP Systems

  • Purpose: Integration of data into a single system for real-time global updates and informed decision-making.

ERP Implementation

  • Determine current and ERP models, remove inconsistencies, and implement the ERP application.

Organizations Using ERP

  • Various sectors including manufacturing, distribution, healthcare, government, retail, and education.

Business Process Management (BPM) and Systems Development

  • Model processes, create process components, implement processes, and assess results.

Classic Five-Step Systems Development Life Cycle

  • Planning, defining system, determining requirements, designing system components, and implementing the information system.

Real-World BPM Issues

  • Challenges in defining processes, creating components, and implementing new processes.