E-business and Enterprise Resource Planning Systems

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Presentation transcript:

E-business and Enterprise Resource Planning Systems Chapter 10 E-business and Enterprise Resource Planning Systems

Outline Learning objectives Nature & forms of e-business Enterprise resource planning systems Application service providers

Learning objectives Explain the nature of e-business, comparing and contrasting it with traditional “brick-and- mortar” organizations. Discuss major forms of e-business. Describe the basic nature, purpose, and structure of enterprise resource planning systems. Give examples and analyze the causes of ERP system failures. List and discuss steps associated with successful ERP implementations. Discuss the role of application service providers in e-business.

Nature & forms of e-business Central feature Business is transacted over a network. Forms B 2 C www.graze.com B 2 B www.oracle.com G 2 C www.irs.gov G 2 B www.sba.gov C 2 C www.eharmony.com

Enterprise resource planning systems Purpose Providing comprehensive information for decision making Nature Fundamentally, relational databases Modular organization Major companies Oracle (PeopleSoft) SAP

Enterprise resource planning systems Table 10.1 Modular organization of ERP systems Generic module name Primary stakeholder group Module components in SAP Customer relationship management (CRM) Customers Sales and distribution Human resource management (HRM) Employees Human resources Supply chain management (SCM) Vendors Materials management Financial management Stockholders Financial accounting

Enterprise resource planning systems Selected failure causes Poor top management leadership Unrealistic expectations Inaccurate data in the system Significant technical difficulties Selected conditions for success Obtain organizational commitment. Communicate strategic goals clearly. View ERP as an enterprise-wide venture. Umble, E., and M. Umble. 2002. “Avoiding ERP Implementation Failure.” Industrial Management, January/February, pp. 25–34.

Application service providers An organization that provides a contractual service to deploy, host and manage applications for customers remotely from a centralized location. Jaruzelski, Ribeiro and Lake (2014)

Application service providers ASP types Enterprise ERP systems Local / regional Payroll services for companies in Denver Specialist Online diversity compliance training Vertical market Patient billing for hospitals Volume business Comprehensive human resource services for mid-range businesses in Nashville

Application service providers Title Reporting on Controls at a Service Organization Three report types SOC 1 Financial reporting SOC 2 Security, confidentiality, privacy and related areas SOC 3 Less detailed version of SOC 2 Using ASPs involves risk. The risk can complicate a financial statement audit. The AICPA issued SSAE 16 to help address that risk in the context of an audit.