CH4 notes: Enterprise Information Systems: ERP, CRM, and SCM 4.

1 Enterprise Systems Four distinct functional areas: Marketing and Sales; Supply chain management; Accounting and Finance; Human resources. Enterprise-wide info sys: allow co to integrate info across operations on a company wide basis which allows personnel to share information seamlessly no matter where the data are located or who is using the application. Ways in which info sys can be leveraged to support or streamline business process (create COMPETITIVE adv): E.g. Support billing process reduces material (paper) and labour (handling of paper) cost. Internally focused systems support functional areas, business process, and decision within an organisation. Externally focused systems coordinate business processes with customers, suppliers, biz partners and others who operate outside an organisation. can also be referred to as inter-organisational system (IOS) streamline the flow of info from one cos operation to anothers satisfy needs of cust efficiently COMPETITIVE adv bcos firms can adapt quicker to changing market conditions, e.g. cust want extra component, firm can tell supplier in real time-efficient. How co are using these systems to support their internal and external operations? Internal focused application: Value chain where info flows through functional areas (core & support) that facilitate the internal activities Core: Enterprise systems Inbound logistics: receiving and Automated warehouse system, automatically update inventory levels at pt of stocking raw materials, parts and delivery thus giving managers access to real time inventory levels and reorder products points. Operations and Manufacturing: Computer controlled machining system. Transforms inputs to finished products Outbound logistics: storing and Automated shipment scheduling systems. Automatically update sales information distributing finished products at the point of distribution to allow managers to view inventory and revenue info in real time. Marketing and Sales: promoting Creating e-brochure to reach a greater market. Use the pricing and scheduling and selling the firms products systems to allow updated information to become immediately accessible throughout the organisation and to end customers. Customer service: maintenance and Have information downloadable relating to g/s purchased by a cust. Have system to repair of firms g/s track cust service record. Support: Administration, Firm Infrastructure, Human resources: employee recruiting, Technology development: improving products and production process, Procurement: purchasing inputs Externally focused application: Companies combine their value chains to form a VALUE SYSTEM create additional value and competitive adv.

The Rise of Enterprise Systems to communicate with other systems in the organisation. Legacy System: Separate info storage files for diff biz activities. Improving biz process through enterprise systems Vanilla version: features and modules that an enterprise system comes with out of the box) Customized software: provides either additional software that is integrated with the enterprise system or direct changes to the vanilla application itself. Best Practices-Based Software Business Process Management: systematic, structured improvement approach by all or part of an organisation whereby ppl critically examine, rethink, and redesign business processes in order to achieve dramatic improvements in one or more performance measures, such as quality, cycle time, or cost. Now called BPR for a radical redesign. Key Capabilities of SAPs mySAP enterprise System Capability Explanation Business analysis Evaluate biz performance by providing functionality for analysing workforce, operations and supply chain. Fins and mgmt Manage corporate finance functions by automating financial supply chain mgmt, fins accounting acct, and mgmt acct. Human capital Tools needed to max profitability potential of the workforce, with functionality for

mgmt Operations mgmt

Corporate services mgmt Self-services

employee transaction mgmt and employee life-cycle mgmt. Streamline operations with integrated functionality for managing end-to-end logistic processes, while expanding collaborative capabilities in supply chain mgmt, product life-cycle mgmt and supplier relationship mgmt. Optimize centralized and decentralized services for managing real estate, corporate level, and incentives and commissions. Provides an employee-centric portal that enables both employees and managers to create, view, and modify key info. Uses a broad range of interaction technologies, including web browser, voice, and mobile devices, for easy access to internal and external business content, applications, and services

4.2 Enterprise Resource Planning (ERP) Integrating data into a common data warehouse and provide similar interfaces that service the entire company. ERP applications are designed to have the same look and feel. ERP applications make accessing accurate and real-time information easier by providing a central information repository allows drilling to the specific individual transactions. Choosing an ERP System ERP control: centralised or particular biz units to govern themselves ERP business requirements: ERP core components support the internal activities, e.g. financial, operations and human resource management. ERP extended components (external focus), e.g. supply chain management (upstream) and CRM (downstream). ERP Limitations As ERP core components are designed to service internal business activities, they tend not to be well suited for managing value system activities (external). 4.3 Customer Relationship Management (CRM)- to achieve COMPETITIVE adv Companies search for ways to widen (attract new cust) , lengthen (keep current cust satisfied), and deepen cust relationships (Transform minor cust into profitable custs) CRM is a corporate-level strategy to create and maintain lasting relationships with cust by concentrating on the downstream info flows need integrated sys to access info and track cust interaction throughout the organisation also need capability to monitor and analyse factors that drive cust satisfaction greater cust satisfaction and incr productivity of sales and service personnel. Benefits of a CRM System Benefits Enables 24/7/365 operation Individualized service Improved info Speeds problem identification/ resolution Speeds processes Improved integration Improved product dev. Improved planning

e.g Web based interfaces provide product info, sales status, support info, issue tracking and so on. Learn how each cust defines g/s quality so that customized product, pricing, and services can be designed or developed collaboratively. Integrate all info from all pts of contacts with custs. Improved record keeping and efficient mtds of capturing cust complaints help to identify and solve problems faster. Integrated info removes info handoffs, speed both sales n support processes.

Provides mechanism for managing and scheduling sales follow-ups to assess satisfaction, repurchase probabilities, time frames and frequency.

Developing a CRM strategy (need enterprise-wide changes) Policy and business process changes reflect cust-focused culture Cust service changes cust- focused measures for quality and satisfaction and enhance cust experience. Employee training changes: all areas employees must have consistent focus that values cust service and satisfaction Data collection, analysis, and sharing changes. Architecture (Components) of a CRM Operational CRM (Front-office system) interaction with cus marketing, sales and support personnel can see all prior and current interactions with the cust, such as history, pending sales and service request, regardless where it occurs in the organisation for personalisation and efficient cust service. Components of CRM that support this: Sales Force Automation- systems to support day to day sales processes such as order processing and tracking.

Increase EFFECTIVENESS for marketing by providing an improved understanding of market conditions, competitors and products. Advantages of sales force mgmt systems for Sales Personnel. (efficiency) Less paper work Cust contact info recorded using e-forms that automatically provide known cust data Fewer errors Fewer handoffs Information is automatically routed to other team members and managers. Thus Better info sales personnel have accurate , up-to-date, complete cust interactions info. Better training, Improved teamwork, Improved morale, Higher sales Advantages of sales force mgmt systems for Sales Managers. (efficiency) Improved time usage Less time summarising and tracking information allows greater time for advising and coaching sales personnel Better planning and forecasts, Improved scheduling, Improved coordination, Better sales force tracking, Improved info Customer Service and Support (CSS): systems that automates service request, complaints, product returns and information request such as customer interaction centre (CIC) which uses automatic call distributions systems to forward calls to next available person; while waiting cust have options to use key or voice response technology to check account status info. Aim at faster response and improve productivity. Enterprise Marketing Management (EMM): ensure right messages (allow personalisation) are sent to right people (not those who already opted out) through right channel. Analytical CRM (back-office system) provides the analysis necessary to more effectively manage the sales, service, and marketing activities. Data Warehouses Data Mining and Visualization Business Intelligence ERP Systems Collaborative CRM systems for providing effective and efficient communication with the customer from the entire organisation. -

Ethical Concerns with CRM Invades cust privacy and facilitates coercive sales practices At what point does communication gets too personal 4.4 Supply Chain management increase efficiency as it prevents excessive inventories, inaccurate manufacturing capacity plans, missed production schedule causing growing problems (ripple effects now called Bullwhip effects) st nd rd Supply chain: one to one. 1 2 3 supplier Supply network: multiple suppliers involved in the process of servicing a single organisation. Bullwhip effect: ripple effects Functions that optimise the supply network Module Key Uses Supply chain Share info and integrate processes up and down the supply chain collaboration Provide Internet-enabled processes such as collaborative planning, forecasting, and replenishment (CPFR) and vendor managed inventory. Collaborative Streamline product design processes across supply chain partners o reduce time to market. design React quickly to changing market condition. Collaborative Commit to delivery in real time. Fulfil orders from channels on time with order fulfilment management, transportation planning, and vehicle scheduling. Support the entire logistic process, including picking, packing, shipping, and international activities. Collaborative Develop a one-no forecast of cust D by sharing D&S forecasts instantaneously across multiple D&S plan tiers. + Real time D signals to replenish stocks. Collaborative Provide global visibility into direct material spending. Allow partners to leverage buying procurement clout and reduce ad hoc (unplanned) buying. Production Support both discreet and process manufacturing. Optimise plans and schedules while planning considering resource, material, and dependency constraints. Supply chain Monitor every stage of the supply chain process, from price quotation to the moment the event mgmt cust receives the product, issuing alerts when problems arise. Capture data from carriers, vehivle on-board computers, GPS systems, and other resources. Supply chain Create an online supply chain community that enables partners to collaborate on design,

exchange Supply chain performance mgmt

procurement, D&S mgmt, and other supply chain activities. Report key measures in the supply chain, such as order cycle times and precent of capacity utilized. Integrate planning ad execution functions with competitive info and market trends.

Supply Chain Planning (SCP) Demand Planning and Forecasting Distribution Planning Production rescheduling Procurement Planning Supply Chain Execution (SCE) focuses on the efficient (extent to which a cos supply chain is focusing on minimizing procurement, production, and transportation costs, sometimes by reducing customer service) and effective (maximising cust service regardless) flow of: Products: movement of gds from supplier to production Information: e.g. order processing and delivery status Finances: e.g. payment schedules Along the supply chain. Emerging SCM trends Distribution portals: more buyers provide efficient tool for buyers to manage all phases of purchasing cycle. Procurement portals: more suppliers efficient tool for suppliers to manage all phases of the distribution cycle Key technologies for enhancing SCM Extensible Markup language (XML) Radio frequency Indentification (RFID) 4.5 The Formula for Enterprise System Success Secure executive sponsorship Get help from outside experts Thoroughly train users Take multidisciplinary approach to implementations Look beyond ERP