1. Information Systems Infrastructure (IS3314)
3rd year BIS 2006 / 2007
Fergal Carton
Business Information Systems

2. Last 2 weeks 14 Nov Case Study 7 Nov Sales processes Marketing IS CRM
Distribute Ch. 7 O’Brien, Section II
Re-cap on all handouts

3. This week Feedback on case study Richness and reach
Functional business systems
E-business and e-commerce
Overview of Information systems
Evolution of ERP from MRP
Key benefits of ERP
ERP: the state of play
Davenport handout

4. Trade-off between richness & reach
Communicate rich information
Proximity
Dedicated channels
Cost & physical constraints
Limited size of audience
Communicate “poor” information
Mass market reach
Generic
Face to face sales pitch
Direct mail
TV ad

5. Electronic information & networks : richness & reach
Information separated from physical carrier
Existing value chains fragment (eg. Encyclopaedia Britannica)
Creates new opportunities eg. Car sales
Internet for options, price, benefit, finance
Changes to physical location of dealerships
Focus on after-sales service

6. Barriers to entry become liabilities
Opportunities for bypassing middlemen
High fixed costs of bricks & mortar
Barnes & Noble
Toys ‘R Us

7. Rethink business models
Focus on single business activity and push into as many segments as possible
Intel
Microsoft
Orchestrate supply chain relationships
Dell
Nike

8. Functional business systems
Production
Operations
Marketing
Human Resource
Management
Finance
Accounting
Functional
Business
Systems

9. Functional business systems
Functional business systems are composed of a variety of types of information systems (transaction processing, management information, decision support, etc.) that support the business functions of:
Accounting
Finance
Marketing
Productions/operations management
Human resource management
Composite or cross-functional information systems cross the boundaries of traditional business functions in order to reengineer and improve vital business processes. Cross-functional information systems as a strategic way to share information resources and improve the efficiency and effectiveness of a business
Internet technologies help integrate the flow of information among their internal business functions and their customers and suppliers. Companies are using the World Wide Web and their intranets and extranets as the technology platform for their cross-functional and interorganizational information systems.

10. E-business and e-commerce
Distinction between e-commerce and e-business:
e-Commerce is defined as buying and selling over digital media.
e-Business encompasses e-commerce, but includes front- and back- office
“e-business is the use of the Internet and other networks and information technologies to support electronic commerce, enterprise communications and collaboration, and Web-enabled business processes both within an internetworked enterprise, and with its customers and business partners”

11. Overview of information systems
Support day to day transaction processing
Back-office (SCM, ERP)
Manufacturing (Scada, LIMS, …)
Engineering (CAD, …)
Front-office (CRM)
Provide management information
EIS
Data warehouse
Portal
Collaborative tools for productivity (eg. MS-Office)
Support links to business partners
IOS, EDI, e-commerce, …

12. What is ERP? Educated Efficient Effective Enterprise Resource Planning
Whole company
Single point of entry
Integrated
Process oriented
People
Money
Materials
Inventory
Transact
Report
Manage
Plan
Educated
Efficient
Effective

13. 1950’s: unlimited demand
Deliver
Supplier
Make
Customer

14. 1960’s : inventory costs money!
Deliver
Supplier
Make
Customer
Plan
Buy

15. 1960’s : inventory costs money
Deliver
Supplier
Make
Customer
Plan
MRP
Buy

16. 1970’s : first wave of integration
Deliver
Supplier
Make
Customer
Plan
Sell
MRP
MRP II
Buy

17. 1980’s : sales order processing
SOP
Deliver
Supplier
Make
Customer
Plan
Sell
MRP
MRP II
Buy

18. 1990’s : back-office integration
Accounting & Finance
Human Resources
Deliver
Supplier
Make
Customer
Plan
Sell
MRP
MRP II
ERP
Buy

19. What is ERP? A system for planning the resources to customer orders
take
make
ship
and account for
customer orders
Modular structure, relational database
APICS – American Production and Inventory Control Society
ERP systems are integrated enterprise-wide software packages designed to support the key functional areas of the firm
Support the recording of all accounting transactions of the business from purchase orders to sales orders - they support the scheduling and monitoring of manufacturing activities and they help manage the firms most critical and expensive resources (O’Doherty and Adam, 1999)
David Sammon © 2002

21. Key benefits of ERP? Single point of data entry (PO’s, SO’s, …)
Inventory control
Opportunity to re-design business processes
Single technical platform (support)
Common language, common pool of data
Sales
Shipping
Collect cash

22. ERP : the state of play High penetration rate in large businesses
ERP seen as panacea to lack of control in subs
Centralising of expensive IS resources
CEO’s are “disappointed” with results
Reporting weakness : need for data warehouse

23. Are there alternatives?
Scalability?
As-is
Best of breed
Flexibility? 4