McGraw-Hill/Irwin © 2008 The McGraw-Hill Companies, All Rights Reserved Chapter 7 Enterprise Infrastructure and Integration
7-2 STUDENT LEARNING OUTCOMES 1.Define an enterprise system. 2.Describe an enterprise resource planning (ERP) system. 3.List and describe the seven “ilities.”
7-3 STUDENT LEARNING OUTCOMES 4.List the key traits that an IT infrastructure should exhibit. 5.Describe the differences among the four types of IT infrastructures. 6.Explain the difference between backup and recovery.
7-4 STUDENT LEARNING OUTCOMES 7.State the purpose of a disaster recovery plan. 8.Explain the need for system integration.
7-5 One View for Del Monte Foods Del Monte needed to overhaul its IT infrastructureDel Monte needed to overhaul its IT infrastructure –Migrate from multiple platforms –Consolidate applications to a central single system
7-6 One View for Del Monte Foods Develop an ERP systemDevelop an ERP system –Merge multiple systems –Quick and cost effective
7-7 One View for Del Monte Foods Class poll…Class poll… 1.Why did Del Monte need to integrate its systems? 2.Why does knowing the sales of Kibbles ‘n Bits and the sales of vegetables help the overall organization? 3.Do you think Del Monte would like to know who is buying combinations of its products? Why?
7-8 INTRODUCTION Successful IT systems provide an integrated view of:Successful IT systems provide an integrated view of: 1.Business 2.Extend analytical capabilities to users 3.Leverage a corporation's information and expertise
7-9 INTRODUCTION Enterprises need to encompass a range of intelligence systems and analytical applications that include:Enterprises need to encompass a range of intelligence systems and analytical applications that include: –Data warehouses and data marts –Online analytical processing (OLAP) –Decision support systems (DSSs) –Executive information systems (EISs)
7-10 ENTERPRISE SYSTEMS An enterprise system (ES) - large software application that companies use to manage their operationsAn enterprise system (ES) - large software application that companies use to manage their operations Key way by which large organizations distribute content of all kinds to their:Key way by which large organizations distribute content of all kinds to their: –Workforce –Suppliers –Customers
7-11 ENTERPRISE SYSTEMS
7-12 ENTERPRISE SYSTEMS Enterprise systems are suited for information transactionsEnterprise systems are suited for information transactions –They are the underlying information “factory” Enterprise systems offer the first great opportunity to achieve true connectivityEnterprise systems offer the first great opportunity to achieve true connectivity –A state in which everyone knows what everyone else is doing in the business all over the world at the same time
7-13 ERP Systems Enterprise resource planning (ERP) systems are software systems for business management, supporting areas such as planning, manufacturing, sales, marketing, distribution, accounting, financial, human resource management, project management, inventory management, service and maintenance, transportation, and e-businessEnterprise resource planning (ERP) systems are software systems for business management, supporting areas such as planning, manufacturing, sales, marketing, distribution, accounting, financial, human resource management, project management, inventory management, service and maintenance, transportation, and e-business
7-14 ERP Systems ERP systems allow companies to implement a single integrated system by replacing legacy information systems.ERP systems allow companies to implement a single integrated system by replacing legacy information systems. Legacy information system (LIS) - represents a massive, long-term business investment; such systems are often brittle, slow, and nonextensibleLegacy information system (LIS) - represents a massive, long-term business investment; such systems are often brittle, slow, and nonextensible
7-15 ERP Systems
7-16 ERP Systems An ERP system is required to have the following characteristics:An ERP system is required to have the following characteristics: –Modular design comprising many distinct business functions such as financial, manufacturing, distribution, and the like –Centralized DBMS –Integrated functions that provide seamless information flow among the functions –Flexible, best business practices –Functions that work in real-time –Internet-enabled
7-17 Core ERP Functions AccountingAccounting FinancialFinancial ManufacturingManufacturing ProductionProduction TransportationTransportation Sales and distributionSales and distribution Human resourceHuman resource Supply chainSupply chain Customer relationshipCustomer relationship E-businessE-business
7-18 ERP Systems
7-19 ERP Systems ERP systems are big businessERP systems are big business At the top of the IT spending list is the ERP marketAt the top of the IT spending list is the ERP market The United States federal government will spend $7.7 billion on ERP products and services in fiscal year 2009The United States federal government will spend $7.7 billion on ERP products and services in fiscal year 2009 –Up 37 percent from 2004 spending of $5.6 billion
7-20 ERP Systems Advantages…Advantages… –Reliable information access –Avoid redundant data and operations –Cost reduction –See more on page 230 DisadvantagesDisadvantages –Time-consuming –Expensive –Vendor dependence –See more on page 230
7-21 Evolution of ERP Systems The early stage of ERP was carried out in the 1970’s through a system called Materials Requirement Planning (MRP)The early stage of ERP was carried out in the 1970’s through a system called Materials Requirement Planning (MRP) Early 1980s MRP was reengineered under the name of Manufacturing Resources Planning or MRPIIEarly 1980s MRP was reengineered under the name of Manufacturing Resources Planning or MRPII
7-22 Evolution of ERP Systems The beginning of the 1990’s came enterprise resource planning (ERP)The beginning of the 1990’s came enterprise resource planning (ERP) ERP systems have evolved into what is now commonly referred to as ERPIIERP systems have evolved into what is now commonly referred to as ERPII
7-23 Evolution of ERP Systems
7-24 ERP Vendors & Market Trends The top dominating ERP software suppliers are:The top dominating ERP software suppliers are: –SAP –Oracle/PeopleSoft –SSA Global –Microsoft Together they control more than 70 % of the multibillion dollar global marketTogether they control more than 70 % of the multibillion dollar global market
7-25 ERP Vendors & Market Trends Complete list is very longComplete list is very long Invensys ( ( Epicor ( ( Mapics ( ( Navison ( ( Deltek ( ( Many more on page 233Many more on page 233
7-26 ERP Vendors & Market Trends The ERP market has been growing at a rate more than 30 %The ERP market has been growing at a rate more than 30 % The growth of the ERP market has been boosted both by business reasons as well as by technical reasonsThe growth of the ERP market has been boosted both by business reasons as well as by technical reasons –The main cited reason is globalization
7-27 DEVELOPING AGILE IT SYSTEMS Business agility means being prepared for change at a moment’s noticeBusiness agility means being prepared for change at a moment’s notice Factors to consider whenever you are developing an IT system - these are commonly referred to as the “ilities”:Factors to consider whenever you are developing an IT system - these are commonly referred to as the “ilities”: –Availability –Accessibility –Reliability –Scalability –Flexibility –Performance –Capacity planning
7-28 Availability Availability is determining when an IT system will be available for employees to accessAvailability is determining when an IT system will be available for employees to access Most companies have IT systems available 24 x 7 x 365Most companies have IT systems available 24 x 7 x 365
7-29 Accessibility Accessibility is determining who has the right to access different types of IT systems and informationAccessibility is determining who has the right to access different types of IT systems and information Accessibility also means who can access or manipulate the information, whether they can create, read, update, and/or delete informationAccessibility also means who can access or manipulate the information, whether they can create, read, update, and/or delete information
7-30 Reliability Reliability ensures your IT systems are functioning correctly and providing accurate informationReliability ensures your IT systems are functioning correctly and providing accurate information Inaccurate information exists for many reasons:Inaccurate information exists for many reasons: –The information being entered incorrectly –The information becoming corrupt
7-31 Scalability Scalability refers to how well a system can adapt to increased demandsScalability refers to how well a system can adapt to increased demands A number of factors can affect organizational growth including:A number of factors can affect organizational growth including: –The market –The industry –The economy
7-32 Flexibility A single system can be designed in a number of different ways to perform exactly the same functionA single system can be designed in a number of different ways to perform exactly the same function When choosing which design to implement, think about the system’s “flexibility,” or the system’s ability to change quicklyWhen choosing which design to implement, think about the system’s “flexibility,” or the system’s ability to change quickly
7-33 Performance Performance measures how quickly an IT system performs a certain processPerformance measures how quickly an IT system performs a certain process Benchmarks are baseline values a system seeks to attainBenchmarks are baseline values a system seeks to attain Benchmarking is a process of continuously measuring system results, comparing those results to optimal system performance (benchmark values), and identifying steps and procedures to improve system performanceBenchmarking is a process of continuously measuring system results, comparing those results to optimal system performance (benchmark values), and identifying steps and procedures to improve system performance
7-34 Capacity Planning Capacity planning determines the future IT infrastructure requirements for new equipment and additional network capacityCapacity planning determines the future IT infrastructure requirements for new equipment and additional network capacity It’s cheaper for an organization to implement an IT infrastructure that considers capacity growth at the beginning of a system deploymentIt’s cheaper for an organization to implement an IT infrastructure that considers capacity growth at the beginning of a system deployment
7-35 INFORMATION SYSTEMS INFRASTRUCTURE An IT architecture is the blueprint for translating a business strategy into a planAn IT architecture is the blueprint for translating a business strategy into a plan An infrastructure is a relative term meaning “the structure beneath a structure”An infrastructure is a relative term meaning “the structure beneath a structure” –This definition implies different layers of structure, which provide support or services
7-36 INFORMATION SYSTEMS INFRASTRUCTURE
7-37 Why Architecture Matters The IT architecture identifies what information must be standardized corporate-wide and what will be standardized at a regional levelThe IT architecture identifies what information must be standardized corporate-wide and what will be standardized at a regional level An IT architecture specifies where and how information will be located and accessedAn IT architecture specifies where and how information will be located and accessed
7-38 Why Infrastructure Matters Global markets are creating enormous demands for increased information sharingGlobal markets are creating enormous demands for increased information sharing A powerful, flexible IT infrastructure has become a prerequisite for doing businessA powerful, flexible IT infrastructure has become a prerequisite for doing business
7-39 Why Infrastructure Matters IT infrastructure should exhibit several key traits, such as:IT infrastructure should exhibit several key traits, such as: –Efficiency –Effectiveness –Agility
7-40 Why Infrastructure Matters Translating the architecture into an infrastructure entails creating details about certain technologies:Translating the architecture into an infrastructure entails creating details about certain technologies: –Hardware –Software –Network –Information
7-41 INFORMATION TECHNOLOGY INFRASTRUCTURE There are four types of information technology infrastructures:There are four types of information technology infrastructures: 1.Decentralized infrastructure 2.Centralized infrastructure 3.Distributed infrastructure 4.Client/server infrastructure
7-42 INFORMATION TECHNOLOGY INFRASTRUCTURE
7-43 Decentralized Infrastructure A decentralized infrastructure involves little or no sharing of information systemsA decentralized infrastructure involves little or no sharing of information systems Gives users the liberty to develop applications that meet their needs and maintain control over the applications they developGives users the liberty to develop applications that meet their needs and maintain control over the applications they develop
7-44 Decentralized Infrastructure
7-45 Centralized Infrastructure A centralized infrastructure involves sharing of information systems in one central area or one central mainframeA centralized infrastructure involves sharing of information systems in one central area or one central mainframe Mainframes were originally the only computers available for businessMainframes were originally the only computers available for business
7-46 Centralized Infrastructure
7-47 Distributed Infrastructure A distributed infrastructure involves distributing the information and processing power of IT systems via a networkA distributed infrastructure involves distributing the information and processing power of IT systems via a network By connecting all the information systems via a distributed infrastructure, all locations can share information and applicationsBy connecting all the information systems via a distributed infrastructure, all locations can share information and applications
7-48 Distributed Infrastructure
7-49 Client/Server Infrastructure A client/server infrastructure (or client/server network) has one or more computers that are servers which provide services to other computers, called clientsA client/server infrastructure (or client/server network) has one or more computers that are servers which provide services to other computers, called clients The client/server infrastructure is a form of distributed infrastructureThe client/server infrastructure is a form of distributed infrastructure
7-50 Client/Server Infrastructure
7-51 Other Types of Infrastructure In a tiered infrastructure (sometimes referred to as a layer infrastructure), the IT system is partitioned into tiers (or layers) where each tier (or layer) performs a specific type of functionalityIn a tiered infrastructure (sometimes referred to as a layer infrastructure), the IT system is partitioned into tiers (or layers) where each tier (or layer) performs a specific type of functionality
7-52 Other Types of Infrastructure A 1-tier infrastructure is the most basic setup because it involves a single tier on a single machineA 1-tier infrastructure is the most basic setup because it involves a single tier on a single machine A 2-tier infrastructure is the basic client/server relationshipA 2-tier infrastructure is the basic client/server relationship
7-53 Other Types of Infrastructure A 3-tier infrastructure is the most common approach used for Web applications todayA 3-tier infrastructure is the most common approach used for Web applications today An n-tier infrastructure balances the work of the network over several different serversAn n-tier infrastructure balances the work of the network over several different servers
7-54 Other Types of Infrastructure
7-55 The Infrastructure Investment IT investments are one of the most important decisions made within an organizationIT investments are one of the most important decisions made within an organization IT infrastructure investments are large, long term, and have no (real) value on their ownIT infrastructure investments are large, long term, and have no (real) value on their own An infrastructure's value lies in its ability to quickly and economically enable the implementation of new applicationsAn infrastructure's value lies in its ability to quickly and economically enable the implementation of new applications
7-56 Supporting an IT Infrastructure Backup is the process of making a copy of the information stored on a computerBackup is the process of making a copy of the information stored on a computer Recovery is the process of reinstalling the backup information in the event the information was lostRecovery is the process of reinstalling the backup information in the event the information was lost Storage area networks (SAN) is an infrastructure for building special, dedicated networks that allow rapid and reliable access to storage devices by multiple serversStorage area networks (SAN) is an infrastructure for building special, dedicated networks that allow rapid and reliable access to storage devices by multiple servers
7-57 Disaster Recovery Plan A disaster recovery plan is a detailed process for recovering information or an IT system in the event of a catastrophic disaster such as a fire or floodA disaster recovery plan is a detailed process for recovering information or an IT system in the event of a catastrophic disaster such as a fire or flood A collocation facility is a company that rents space and telecommunications equipment from another companyA collocation facility is a company that rents space and telecommunications equipment from another company A disaster recovery cost curve charts (1) the cost of the unavailability of information and technology and (2) the cost of recovering from a disaster over timeA disaster recovery cost curve charts (1) the cost of the unavailability of information and technology and (2) the cost of recovering from a disaster over time
7-58 Disaster Recovery Plan
7-59 INTEGRATING THE ENTERPRISE Integration allows separate applications to communicate directly with each other by automatically exporting data files from one application and importing them into anotherIntegration allows separate applications to communicate directly with each other by automatically exporting data files from one application and importing them into another Building integrations between applications helps an organization maintain better control of its informationBuilding integrations between applications helps an organization maintain better control of its information
7-60 Why Integration Is Necessary Business process reengineering (BPR) is the analysis and redesign of workflow within and between enterprisesBusiness process reengineering (BPR) is the analysis and redesign of workflow within and between enterprises Workflow defines all the steps or business rules, from beginning to end, required for a business processWorkflow defines all the steps or business rules, from beginning to end, required for a business process
7-61 Motives for Integration An organization may choose to integrate because of its concerns about its operations, both with internal processes and external relationshipsAn organization may choose to integrate because of its concerns about its operations, both with internal processes and external relationships Enterprise integration is viewed as a possible solution to a number of problems with internal organizational processesEnterprise integration is viewed as a possible solution to a number of problems with internal organizational processes
7-62 Motives for Integration
7-63 Benefits of Integration Many of the benefits can be easily measured in financial termsMany of the benefits can be easily measured in financial terms –Cost reduction –Reduction of inventory costs –Reduction of personnel costs
7-64 Benefits of Integration
7-65 Service-Oriented Architecture Service-oriented architecture (SOA, SoA) – architecture perspective that develops and uses small self-contained blocks of code to meet application software needsService-oriented architecture (SOA, SoA) – architecture perspective that develops and uses small self-contained blocks of code to meet application software needs Web services – small modules of software (blocks of code) that are interoperable and can run across a networkWeb services – small modules of software (blocks of code) that are interoperable and can run across a network
7-66 Service-Oriented Architecture An SoA is a holistic perspective of software and software developmentAn SoA is a holistic perspective of software and software development It reuses blocks of code to increase productivityIt reuses blocks of code to increase productivity SoAs are the futureSoAs are the future
7-67 CAN YOU… 1.Define an enterprise system. 2.Describe an enterprise resource planning (ERP) system. 3.List and describe the seven “ilities.”
7-68 CAN YOU… 4.List the key traits that an IT infrastructure should exhibit. 5.Describe the differences among the four types of IT infrastructures. 6.Explain the difference between backup and recovery.
7-69 CAN YOU… 7.State the purpose of a disaster recovery plan. 8.Explain the need for system integration.