Processes, Organizations, and Information Systems

Basic Types of Processes

• Information systems can improve process quality by:
  • Efficiency: Increasing the ratio of process outputs to inputs.
  • Effectiveness: Enhancing how well a process achieves organizational strategy.
  • Improvement: Changing process structure and resources.
  • Automation: Partial or complete automation.
  • Augmentation: Helping humans perform activities.
  • Control: Controlling process flow.

Information Silos

• Information silos are data isolated in islands of automation, leading to:
  • Different department goals and disjointed processes.
  • Duplicate data and organizational inefficiencies.
  • Increased expenses.

Common IS Solutions to Eliminate Information Silos

• Customer Relationship Management (CRM)
• Supply Chain Management (SCM)
• Enterprise Resource Planning (ERP)

Customer Relationship Management (CRM)

• Objective: Increase customer loyalty/retention and profitability.
• Manages all aspects of customer relationships.
• Three phases:
  • Reporting: Identifying customers across applications.
  • Analyzing: Segmenting customers into categories.
  • Predicting: Making predictions about customer behavior.
• Provides personalized messaging, sales team collaboration, and lead management.

Supply Chain Management (SCM)

• Definition: The logistical and financial processes associated with planning, executing, and monitoring supply chain operations.
• Most often used by large companies (>\$1000M in revenue).
• Requires visibility, information quality, and feedback.
• Bullwhip Effect: Variability in order size and timing increases at each stage up-chain.
  • Can be mitigated by sharing consumer-demand information.
• Future trends: Collaborative demand planning, integrated selling chain management, and predictive risk analysis.

Blockchain

• Definition: A shared database (ledger) among entities in a peer-to-peer network.
• Benefits:
  • Enhanced security and transparency.
  • Instant traceability and cost savings.
  • Decentralization and distribution of power.

Enterprise Resource Planning (ERP)

• Automates business processes and integrates primary value chain activities with HR and accounting.
• Provides a cross-functional, process view of the entire organization.
• Challenging and expensive to implement, requiring significant business process redesign.

Future of Enterprise Systems

• Tighter integration of SCM, CRM, and ERP.
• Higher intelligence through adaptive/generative AI.
• Increased functionality with big data, analytics, and prediction.
• More apps for social and security (Blockchain).