Business Systems

1. Business Systems Chapter 4 ©2007 Prentice Hall

2. Chapter 4 Objectives After studying this chapter, you will be able to: • Identify eight principles of systems thinking that can improve your skills as a manager • Describe the value chain and value web concepts • Define supply chain management and explain its strategic importance • Highlight the differences between quality control and quality assurance ©2007 Prentice Hall

3. Chapter 4 Objectives, cont. • Identify four major ways that businesses use information • Differentiate between operational information systems and professional and managerial systems • Identify seven important information systems issues that managers must be aware of in today’s business environment ©2007 Prentice Hall

4. What Is a System? ©2007 Prentice Hall

5. Principles of Systems Thinking • Help everyone see the big picture • Understand how individual systems really work and how they interact • Understand problems before you try to fix them • Understand the potential impact of solutions before you implement them ©2007 Prentice Hall

6. Principles of Systems Thinking, cont. • Don’t just move problems around; solve them • Avoid the “bigger hammer” syndrome • Understand how feedback works in the system • Use mistakes as opportunities to learn and improve ©2007 Prentice Hall

7. Business Model Generate Revenue Gain Profitability Highest Level System ©2007 Prentice Hall

8. Value Chains ©2007 Prentice Hall

9. Supply Chain Management Manage Risks Manage Relationships Manage Trade-offs ©2007 Prentice Hall

10. Supply Chain vs. Value Chain Supply Chain Value Chain Everyone is part of the Value Chain Focuses on the “downstream” process • Part of the overall Value Chain • Focuses on “upstream” process ©2007 Prentice Hall

11. Supply Chain Systems and Techniques MRP MRP II ERP ©2007 Prentice Hall

12. Operations Managers Inputs Transformation Outputs Coordinating The Supply Chain Assuring Product Quality Production ©2007 Prentice Hall

13. Local Taxes Construction Energy Land Labor Raw Materials Transportation Living Standards Facility Location ©2007 Prentice Hall

14. Capacity Planning Level of Resources Customer Demand ©2007 Prentice Hall

15. Scheduling Dispatching Contingencies Production Scheduling ©2007 Prentice Hall

16. 5 3 ID 4 1 6 2 Cut tops Task Name Sand Make legs Assemble Drill Paint 8/1/04 9/19/04 9/12/04 Start Date 8/22/04 9/5/04 8/29/04 8/28/04 9/25/04 8/28/04 9/25/04 9/4/04 End Date 9/11/04 5d Duration 20d 10d 5d 5d 5d 2004 August September GANTT Chart ©2007 Prentice Hall

17. PERT • Identify the critical path • Identify activities • Determine sequence • Establish time frame • Diagram activity network • Calculate longest completion path • Refine timing ©2007 Prentice Hall

18. Computer-Aided Manufacturing (CAM) Computer-Aided Design (CAD) Computer-Aided Engineering (CAE) Computer-Integrated Manufacturing (CIM) Advanced Technology Product Life-Cycle Management (PLM) Flexible Manufacturing System (FMS) ©2007 Prentice Hall

19. Manufacturing Goods Mass Production Customized Production Mass Customization ©2007 Prentice Hall

20. Challenges of Service Delivery Customer Involvement Delivery Timing People-Intensive Activities Production and Location Subjective Quality ©2007 Prentice Hall

21. Quality Quality Control Quality Assurance SQC SPC ©2007 Prentice Hall

22. Continuous Improvement Kaizen Theory TQM Six Sigma ©2007 Prentice Hall

23. Total Quality Management (TQM) • Management commitment to supporting TQM at every level in the organization • Clear focus on customers and their needs • Employee involvement throughout the organization • Commitment to continuous improvement • Willingness to treat suppliers as partners • Meaningful performance measurements ©2007 Prentice Hall

24. Six Sigma • Define the problem that needs to be solved • Measure current performance to see how far it deviates from desired performance • Analyze the root causes of this deviation from the ideal • Improve the process by brainstorming, selecting, and implementing changes • Control the process long-term to make sure performance continues to meet expectations ©2007 Prentice Hall

25. Global Quality Standards ISO 9000 ISO 14000 ©2007 Prentice Hall

26. Information Systems ©2007 Prentice Hall

27. Research and Development Marketing and Sales Planning and Control Communication And Collaboration How Businesses Use Information ©2007 Prentice Hall

28. Operational Systems Transaction Processing Office Automation Process and Production Control Customer Relationship Management ©2007 Prentice Hall

29. Professional and Managerial Systems ©2007 Prentice Hall

30. The Internet Revolution Accelerates Commerce Erases Border Controls Costs Collaborates & Communicates Simplifies Research ©2007 Prentice Hall

31. Information System Management Issues • Ensuring Security and Privacy • Protecting Property Rights • Guarding Against Information Overload • Monitoring Productivity • Managing Total Cost of Ownership • Developing Employee Skills • Maintaining the Human Touch ©2007 Prentice Hall

32. Ensuring Security and Privacy • Malware • Security Breach • Unauthorized Software • Web 2.0 • Misuse of Information • Poor Security Planning • Lack of Control ©2007 Prentice Hall