Electronic Commerce

1. Electronic Commerce Semester 2 Term 2 Lecture 30

2. Intranets & Corporate Finance • The true competitiveness of a firm is determined by the ability if its management to make accurate, timely decisions that improve profitability and long-term prospects • To make these decisions, an organistaion must possess knowledge about various customers, products, and suppliers, the availability of assets, the status of commitments, and the profitability of activities

3. What Exactly Are Financial Systems? • A financial system encompasses business processes, procedures, controls and data dedication to the operation and maintenacne of corporate financial objectives • It incorporates the following tasks: • Report and analyse financial data • Simplify the budgeting and forecasting process, enabling better planning • Control the financial consolidation of actual results • Answer ad hoc requests efficiently • Improve cost control and performance measurement

4. What Should Financial Intranets Do? • Successful Intranet implementations must help tackle four problems that existing systems are not well equipped to handle: • Lack of insights into production control • Lack of insights into how daily operations are affecting short-term and long-term strategy • Lask of insight into cost control • Lack of control over report generation

5. Lack of Insight into Production Control • Current systems do not produce accurate product costs for pricing, sourcing, product mix and responses to competition • By integrating financial functions inot decision making, the organisation can assess the financial consequences of its strategic and operational decisions on a timely and accurate basis, regardless of the type of decision or where it is made

6. Lack of Insight into Daily Operations • The current systems encourage managers to contract to the short-term cycle of the monthly profit-and-loss statement • To be useful, strategic information must be derived from the mass of operational data being stored; overnight batch reports are no longer efficient

7. Lack of Insight Into Cost Control • Existing accounting information provides little help for reducing costs and improving productivity and quality • Indeed, the information might even be harmful • Many companies, especially those that are large or highly decentralised, are finding it difficult to get at the information they need to effectively manage their business • Saddled with inflexible legacy systems and a variety of different accounting methods, these companies have difficulty handling simple reorganisations, let alone using their financial information to manage strategically in a rapidly changing world

8. Lack of Control Over Report Generation • As computing has become widespread and more powerful, the balance of data processing power has shifted away from central IS staffs to individuals in functional departments • By tying together desktop computers, inexpensive Intranets enable businesses to integrate their information systems to a greater extent than was previously possible • Clearly the need for integration is a key driver of the financial Intranet marketplace