1. Business Driven Technology Unit 1 Achieving Business Success Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.

2. 3-2 Unit One O Chapter 1– Business Driven Technology O Chapter 2 – Identifying Competitive Advantages O Chapter 3 – Strategic Initiatives for Implementing Competitive Advantages O Chapter 4 – Measuring the Success of Strategic Initiatives O Chapter 5– Organizational Structures that Support Strategic Initiatives

3. Chapter 3 Strategic Initiatives for Implementing Competitive Advantages 3-3

4. 3-4 LEARNING OUTCOMES 1. Explain supply chain management and its role in business 2. Explain customer relationship management systems and how they can help organizations understand their customers 3. Summarize the importance of enterprise resource planning systems 4. Identify how an organization can use business process reengineering to improve its business

5. 3-5 Strategic Initiatives O Organizations can undertake high- profile strategic initiatives including: O Business process reengineering (BPR) O Supply chain management (SCM) O Customer relationship management (CRM) O Enterprise resource planning (ERP)

6. 3-6 Business Process Reengineering O Business process – a standardized set of activities that accomplish a specific task, such as processing a customer’s order O Business process reengineering (BPR) – the analysis and redesign of workflow within and between enterprises

7. 3-7 Business Process Reengineering O Reengineering the Corporation – book written by Michael Hammer and James Champy that recommends seven principles for BPR

8. 3-8 Finding Opportunity Using BPR O A company can improve the way it travels the road by moving from foot to horse and then horse to car O BPR looks at taking a different path, such as an airplane which ignore the road completely

9. 3-9 Finding Opportunity Using BPR O Progressive Insurance Mobile Claims Process

10. 3-10 Supply Chain Management O Supply Chain Management (SCM) – The management of information flows between and among activities in a supply chain to maximize total supply chain effectiveness and profitability

11. 3-11 Basics of Supply Chain O The supply chain has three main links: 1. Materials flow from suppliers and their “upstream” suppliers at all levels 2. Transformation of materials into semifinished and finished products through the organization’s own production process 3. Distribution of products to customers and their “downstream” customers at all levels

12. 3-12 Basics of Supply Chain O Organizations must embrace technologies that can effectively manage supply chains

13. 3-13 SUPPLY CHAIN MANAGEMENT O Five basic supply chain activities

14. 3-14 SUPPLY CHAIN MANAGEMENT Supply Chain Example

15. 3-15 SUPPLY CHAIN MANAGEMENT Walmart and Procter & Gamble SCM Example

16. 3-16 SUPPLY CHAIN MANAGEMENT O Effective and efficient SCM systems can enable an organization to O Decrease the power of its buyers O Increase its own supplier power O Increase switching costs to reduce the threat of substitute products or services O Create entry barriers thereby reducing the threat of new entrants O Increase efficiencies while seeking a competitive advantage through cost leadership

17. 3-17 SUPPLY CHAIN MANAGEMENT Effective and Efficient SCM Systems Effect on Porter’s Five Forces

18. 3-18 Customer Relationship Management O Customer relationship management (CRM) – involves managing all aspects of a customer’s relationship with an organization to increase customer loyalty and retention and an organization's profitability O Many organizations, such as Charles Schwab and Kaiser Permanente, have obtained great success through the implementation of CRM systems

19. 3-19 Customer Relationship Management O CRM is not just technology, but a strategy, process, and business goal that an organization must embrace on an enterprisewide level O CRM can enable an organization to: O Identify types of customers O Design individual customer marketing campaigns O Treat each customer as an individual O Understand customer buying behaviors

20. 3-20 Customer Relationship Management

21. 3-21 Evolution of CRM O CRM reporting technology – Help organizations identify their customers across other applications O CRM analysis technologies – Help organization segment their customers into categories such as best and worst customers O CRM predicting technologies – Help organizations make predictions regarding customer behavior such as which customers are at risk of leaving

22. 3-22 Evolution of CRM

23. 3-23 Enterprise Resource Planning O Enterprise resource planning (ERP) – integrates all departments and functions throughout an organization into a single IT system so that employees can make decisions by viewing enterprisewide information on all business operations O Keyword in ERP is “enterprise”

24. 3-24 Enterprise Resource Planning O Sample data from a sales database

25. 3-25 Enterprise Resource Planning O Sample data from an accounting database

26. 3-26 Enterprise Resource Planning O ERP systems collect data from across an organization and correlates the data generating an enterprisewide view

27. 3-27 LEARNING OUTCOME REVIEW O Now that you have finished the chapter please review the learning outcomes in your text