Organizations and Information Systems

1. Chapter 7 Organizations and Information Systems

2. Study Questions Q1: How do information systems vary by scope? Q2: How do enterprise IS solve the problems of departmental silos? Q3: What are the differences among CRM, ERP, SCM and EAI systems? Q4: How do inter-enterprise IS solve the problems of enterprise silos?

3. Q1: How Do Information Systems Vary by Scope?

4. Q2: How Do Enterprise IS Solve the Problems Of Departmental Silos? An information silo is a management system incapable of reciprocal operation with other, related management systems.

5. Fox Lake Country Club Departmental Goals and Silos

6. Departmental Information Systems: Islands of Automation

7. How Do Enterprise Information Systems Eliminate Silos? Fox Lake Country Club Enterprise Reservation System

8. What Problems Do Information Silos Cause? Some of Departments Involved in Patient Discharge

9. An Enterprise System for Patient Discharge

10. How Do Enterprise IS Solve the Problems Of Departmental Silos?

11. Problems of Silos Created in Isolation

12. How Do Organizations Solve the Problems of Information Silos?

13. Business Process Reengineering (BPR) “Analysis and design of workflows and processes within an organization” (wikipedia.org) Identify Processes Review, Update, Analyze As-Is Enterprise systems not feasible until network, data communication, and database technologies reached sufficient level of capability and maturity in late 1980s and early 1990s. Test and Implement To-Be Design To-Be

14. Business Process Reengineering (BPR) (cont’d) Altering and designing business processes to take advantage to enable creation of stronger, faster, more effective linkages among value chains BPR is difficult, slow, and exceedingly expensive Systems analysts need to interview key personnel throughout organization to determine how best to use new technology BPR requires high-level and expensive skills and considerable time

15. Q3: How Do CRM, ERP, and EAI Support Enterprise Systems? Help organizations fundamentally rethink how they do work to dramatically improve customer service, cut operational costs, and become world-class competitors Inherent processes save money and time in business process reengineering (“industry best practices”) Eliminate costs of developing complex applications in-house Enterprise Application Integration (EAI)

16. Vendors PeopleSoft—licensed payroll and limited capability HRM systems, administration to large orgs. Siebel—licensed sales lead tracking and management system (acquired by Oracle) SAP—licensed enterprise resource management for midsize and large organizations in all industries and sectors (Oracle, SAGE, Microsoft) sales lead: the identification of a person or entity that has the interest and authority to purchase a product or service.

17. Customer Relationship Management (CRM) A suite of applications, a database, and a set of inherent processes for managing all interactions (Vendors: SAP, Oracle, Salesforce.com, Microsoft) • through four phases of customer life cycle: • Marketing, customer acquisition, relationship management, loss/churn to support customer-centric organization lead generation: to generate consumer interest or inquiry into products or services of a business

18. Four Phases of Customer Life Cycle

19. Major Components of a CRM Application

20. Enterprise Resource Planning (ERP) Suite of applications, database, and set of inherent processes for consolidating business operations into single, consistent, computing platform

21. Enterprise Application Integration (EAI) Suite of software to integrate existing applications together Connects system “islands” via new software layer Enables existing applications to communicate and share data Provides integrated information Leverages existing systems—leaving functional applications as is, but providing integration top layer Enables a gradual move to ERP

22. EAI Automatically Makes Data Conversions Among Different Systems Virtual Integrated Database MRP – Manufacturing Resource Planning Metadata - The design and specification of data structures

23. Supply Chain Management Systems (SCM) • Manage firm’s order-related information from supply of raw materials to delivery of finished products. • Share information about • Orders, production, inventory levels, delivery of products and services • Goal: Right volume of products to destination with least amount of time and lowest cost

24. Example of a Supply Chain Management System Customer orders, shipping notifications, optimized shipping plans, and other supply chain information flow among Haworth’s Warehouse Management System (WMS), Transportation Management System (TMS), and its back-end corporate systems.

25. Q4: How Do Inter-enterprise IS Solve the Problems of Enterprise Silos?

26. Inter-enterprise PRIDE System

27. Q5: What Are the Challenges When Implementing New Enterprise Systems? Employee Resistance • Challenges • Difficulty • Expense • Risk Requirements Gaps Transition Problems Collaborative Management

28. Challenges Collaborative Management • No single manager in charge • Committees and steering groups Requirements Gaps • Licensed products are never perfect fit • Features and functions of complex products makes identifying gaps difficult • Deciding what to do with gaps. Adapt to application or change application?

29. Challenges (cont’d) Transition problems • Careful planning and substantial training critical • Change requires effort and creates fear • Senior level management must communicate need for change to organization, and must re-iterate • Train key users ahead of time to create positive buzz about new system • Video demonstrations of employees successfully using new system • Encourage change with extra inducements Employee resistance