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Chapter 02

Chapter 02. Software for Information Management. Objectives and outcomes. Objective To define how the different forms of software contribute to an organization and review issues in software selection Learning outcomes:

abigail-zamora
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Chapter 02

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  1. Chapter 02 Software for Information Management

  2. Objectives and outcomes • Objective • To define how the different forms of software contribute to an organization and review issues in software selection • Learning outcomes: • Understand how different types of software support business information management • Distinguish between the concepts of e business and e commerce • Assess how the information management applications can support information flows within and between organizations - -

  3. Management issues • How do we select the appropriate portfolio of information management applications? • Should we make, buy or rent software? • Should we adopt open source software?

  4. Information Systems, Software, Hardware • Information systemThe combination of hardware and software technology used by an individual to perform tasks including information management • Software - IntangibleThe instructions or programs used to control a computer system through interaction with hardware • Hardware - TangibleThe physical components of a computer system such as its input devices, processor, memory, storage and output devices Which is which? (a) Windows, (b) Sage Accounts, (c) A PC, (d) An iPod

  5. IT spend trends Table 2.1 Worldwide End-User Spending on IT Products and Services (Billions of U.S. Dollars) 2007 $3.1 Trillion 8% higher than 2006 Source: Gartner (2002)

  6. Categories of software Renault has an applications portfolio of 1,400 Figure 2.1 Different categories of software Source: BIM

  7. Applications and systems software Figure 2.2The relationship between applications software and systems software Source: BIM

  8. Categories of applications software Figure 2.3Main categories of applications software according to organizational scope Source: BIM

  9. How applications support decision making (The Anthony model) Figure 2.4 Different forms of applications used to support management decision making within an organization Source: Chaffey (2004)

  10. Anthony Model Information Systems can also be categorised as operational, tactical and strategic, depending on their use as per the Anthony model. This model proposes three levels in an organisation; operational, tactical and strategic. At the operational level, systems in use include Office Automation Systems, Transaction Processing Systems and Expert Systems. At the tactical level, system use includes Management Information Systems and Decision Support Systems. Executive Information Systems and Decision Support Systems are used at the strategic level.

  11. Business applications developed by ERP – the SAP example http://www.sap.com/solutions/business-suite/erp/customersuccess/index.epx Figure 2.5Business applications delivered by an enterprise resource planning (ERP) system Source: SAP

  12. Growth in ERP - the SAP example Figure 2.6The development of the SAP ERP system Source: SAP

  13. IT systems = Grain silos Figure 2.7 Grain silos – a great analogy for the problems of separate applications and databases Source: BIM

  14. Mini case study – Minolta Europe • Moved to using enterprise applications software SAP R/3 as part of a plan to move to a common global IT infrastructure. • Aims to enable divisions around the world to share data more readily. • Query processing times will also be reduced from several minutes to less than a second. • Three centralized server hubs in Japan, Germany and the US will provide business applications to more than 60 sites around the world • The new system will support global sales, finance, procurement and customer service. • Benefits - Holger Mailand, Team Manager, System Planning & Support, Information System Division, Minolta Europe Gmbh. • ‘We found this to be an attractive option because it dramatically cut down the chaos and costs of managing and operating multiple platforms and systems. For a global company to be successful, the sales and communication channels must be open – so that information can be accessed on demand.’

  15. Types of systems software Figure 2.8 Different categories of systems software Source: BIM

  16. Operating system functions The functions of operating systems software include: • Managing the user interface (GUI). • Managing data transfer with hardware. • Managing the file system. • Managing access to systems resources (access control). • Managing system resources for different applications. • Providing utilities for systems management.

  17. Operating system popularity of Google users Figure 2.9 Operating systems used to access Google, February 2004 Source:http://www.google.com/press/zeitgeist.html

  18. Windows Timeline Figure 2.10 Timeline of the main versions of Microsoft Windows Source: www.microsoft.com/windows/WinHistoryProGraphic.mspx

  19. Windows Task Manager Figure 2.11 Task Manager view of processes in Windows XP Source: Microsoft

  20. Issues in software selection 1. Identify criteria and functionality for new system. The important criteria in the next section will be identified. 2. Take the make, rent or buy decision. For most specialist application software there is a choice of creating the software from scratch, renting it online or purchasing it from a packaged software vendor. 3. Identify possible suppliers. A ‘longlist’ of perhaps five to ten suppliers that can meet the requirements listed below will be drawn up by searching on the web or from articles and ads in relevant magazines. 4. Produce a shortlist of preferred suppliers. A shortlist will be produced by using a checklist to select the best suppliers from those that meet the most requirements. 5. Select supplier from shortlist. There are a number of methods for finally selecting the supplier which are dependent on the cost and importance of the final system.

  21. 1 Software selection criteria 1. Functionality. 2. Ease of use. 3. Performance. 4. Scalability. 5. Compatibility or interoperability. 6. Extensibility. 7. Stability or reliability. 8. Security. 9. Support.

  22. 2 The Make, Buy or Rent decision 1. Bespoke. With a bespoke development, a completely new, unique application is developed from scratch through programming of a solution. 2. Off-the-shelf or packaged. In a packaged implementation, a standard existing system is purchased from a software vendor and installed on computers located within an organization. Alternatively free or low-cost open-source software 3. Hosted solution (packaged). With a hosted solution, a standard system is used, but it is not managed 4. Tailored development. In a tailored development, an off-the-shelf system or hosted solution is tailored according to an organization’s needs.

  23. 2. Acquisitions alternatives

  24. 3. Select suppliers Best of breed or single solution providers

  25. Open Source software • The Open Source organization (www.opensource.org) explain the benefits of open source software as follows: • ‘The basic idea behind open source is very simple: When programmers can read, redistribute, and modify the source code for a piece of software, the software evolves. People improve it, people adapt it, people fix bugs. And this can happen at a speed that, if one is used to the slow pace of conventional software development, seems astonishing. • We in the open source community have learned that this rapid evolutionary process produces better software than the traditional closed model, in which only a very few programmers can see the source and everybody else must blindly use an opaque block of bits.’

  26. A happy open source adopter • Sterling Ball, chief executive of Californian guitar and guitar string manufacturer, Ernie Ball. • He says that since the change-over productivity has improved. ‘We don't have crashes and don't have viruses’; and it is also cheaper: he believes he may save $80,000 to $100,000 a year. • Two years previously, the company was fined $90,000 when, after an unannounced raid by armed US Marshals instigated by the Business Software Alliance, formed to protect companies’ investments in software, it was found to have eight unlicensed copies of Microsoft Office. The company paid the fine, but Ball was so furious that he decided to purge his company of all Microsoft products. It chose open source software for almost everything, in particular, Linux, the operating system, and OpenOffice, the open source productivity suite owned by Sun Microsystems that forms the basis of the StarOffice suite.

  27. How Linus developed Linux Wired (2003) explains: • At 21, wearing a ratty robe in a darkened room in his mother's Helsinki apartment, Linus Torvalds wrote the kernel of an operating system that can now be found inside a boggling array of machines and devices. • He posted it on the Internet and invited other programmers to improve it. Since then, tens of thousands of them have, making Linux perhaps the single largest collaborative project in the planet's history.

  28. To Open Source or Not?

  29. E-business and E-commerce – The impact on one industry - banking 2 million bank accounts in America robbed – 2004 2006 52% of American households use online banks Source: Online banking report, Number 89, December 10, 2002.

  30. How important is E-business? • 25-44 year olds online (ever)? • 21% 41% 61% 81% • Purchased products online, > £100(3 months) • 21% 41% 61% 81% • Industry Internet advertising spend? • 0.25% 2.5% 12.5% 25% Source 1,2: www.statistics.gov.uk April 2004 3: IAB/PwC 2003 audit www.iabuk.net

  31. The Internet’s impact on you • How many of you have purchased something on the Internet in the last 6 months? • How many times have you used the Internet as an information source, before buying offline? • How many use Facebook or Myspace ?

  32. Definitions • You are asked to distinguish between e-commerce and e-business at a job interview. • Write down your definitions. • Use examples to illustrate your points.

  33. E-commerce defined ‘All electronically mediated information exchanges between an organization and its external stakeholders’ Examples: • Buying books online (transactional) • Selecting a car online (informational) • Interacting with brand online (relationship building / experiential, e.g. www.tango.com) • Asking a customer service query, e.g. www.easyJet.com

  34. E-business defined All electronically mediated information exchanges, both within an organization and with external stakeholders supporting the range of business processes Examples: • Purchasing from suppliers (e procurement) • A company intranet • Supplying partners with information through an extranet -

  35. Web self-service application Figure 2.12 Web self-service application – Frequently Asked Questions at Huddersfield University Source: Huddersfield University web site (www.hud.ac.uk)

  36. The relationship between E-business & E-commerce Figure 2.13 The relationship between e-commerce and e-business Source: Chaffey (2004)

  37. Products purchased online Figure 2.14 Product purchased and selected online in Europe, 2003 shown as a percentage of Internet users Source:www.eiaa.co.uk/casestudies/shwcasestudies.asp

  38. Education UK Website Figure 2.15Education UK, the British Council web site promoting further and higher education in the UK Source: The British Council (www.educationuk.org)

  39. Disintermediation and reintermediation Figure 2.16 From original marketplace structure (a) to disintermediation (b) and reintermediation (c)disintermediation is the removal of intermediaries in a supply chain: Source: Chaffey (2004)

  40. Intranets and Extranets Figure 2.17 The relationship between access to intranets, extranets and the Internet Source: Chaffey (2004)

  41. A university intranet Figure 2.18Example content from a university intranet Source: Napier University (www.napier.ac.uk)

  42. Intranet benefits 1. Improved information sharing (customer service) 97% 2. Enhanced communications and information sharing (communications) 95% 3. Increased consistency of information (customer service) 94% 4. Increased accuracy of information (customer service) 93% 5. Reduced or eliminated processing 93% 6. Easier organizational publishing 92%

  43. Extranet benefits 1. Information sharing in secure environment. 2. Cost reduction. 3. Order processing and distribution. 4. Customer service.

  44. Extranet management issues 1. Are the levels of usage sufficient? 2. Is it effective and efficient? 3. Who has ownership for the extranet? 4. What are the levels of service quality? 5. Is the quality of the information adequate?

  45. UCAS Website Figure 2.19 UCAS (Universities and Colleges Admission services) Source: UCAS (www.ucas.ac.uk)

  46. A Blog example Figure 2.20 An example of a web log for business people and researchers – The Freedom of Information Act Blog Source:http://foia.blogspot.com

  47. CRM Elements

  48. CRM applications 1. Sales force automation (SFA). Sales representatives are supported in their account management through tools to arrange and record customer visits. 2. Customer service management. Representatives in contact centres respond to customer requests for information by using an intranet to access databases containing information on the customer, products and previous queries. 3. Managing the sales process. This can be achieved through e-commerce sites, or in a B2B context by supporting sales representatives by recording the sales process (SFA). 4. Campaign management. Managing ad, direct mail, e-mail and other campaigns. 5. Analysis. Through technologies such as data warehouses and approaches such as data mining, customers’ characteristics, their purchase behaviour and campaigns can be analysed in order to optimize the marketing mix.

  49. Supply chain management 1 • Supply chain management (SCM) is the coordination of all supply activities of an organization from its suppliers and delivery of products to its customers. • Information technology has a great impact on SCM since it enables information about demand and supply for products to be more easily exchanged.

  50. E-SCM Benefits 1 • Increased efficiency of individual processes. Here the cycle time to completion of a process and the resources needed to execute it are reduced. • For example, if online ordering or e-procurement is adopted this will result in a lower faster cycle time and cost per order will be reduced. • Cambridge Consultants which has over 4,000 suppliers. • Before: Procurement process involved between eight and ten people and cost the company anywhere from £60 to £120 per order, depending on the complexity of the order. • After using a combination of purchasing cards and e-procurement using electronic forms and e-mail based authorisation for purchases from strategic supplier RS Components (www.rswww.com) has meant that average order costs have been reduced to £10. • Benefit: reduced cycle time and cost per order.

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