00. Tom Tat Toan Bo Noi Dung IT for Managers

8/12/2019 00. Tom Tat Toan Bo Noi Dung IT for Managers

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or they serve as an exchange for buying and selling via a bidding !ebay

website$

1.* Business +ressure, rganiational +erformances, IT Suort:

/ Business +ressure:

- Economic0ar'et

rom the global company and strong competition, the need for real time

operations, the changing forces and powerful customers %xample: when you

buy products not only at a physical shop but customer can have more

choices and compare the products and prices. usinesses must launch better

products, good service locally and internationally.

-Technology: /echnology pressure comes from technological innovations,

obsolescence and information load. /echnology plays an important role in

any business. /echnology affects businesses in many ways. 0ne such

technology is the Internet

- Society: Including social responsibility, compliance with government

regulations and social deregulations, ethical issues, terrorist attacs and

homeland security %xample in 1alaysi, in term of government regulations,

every government agency needs to use electronic procurement.

/ +erformance of rganiation: 2 categories

- Strategy anagement an# Systems: enable organizations to increase maret

share and2 or profits. %xample I/ support systems to integrate and automatemany of their internal business process. 3reating efficiency and dynamic

business environment for the company.

- ontinuous Imro%ement: business can increase their operating efficiency.

%xample: businesses apply /otal 4uality 1anagement to improve their

products.

- 3estructuring Business +rocesses: improving and redesign business

processes. %xample: in the ban, a customer has to deal with manydepartments for different services. y using I/, the ban can redesign so that

the customers can conduct baning transaction through a single point of

contact.

- anufacturer to or#er: it is build-to-order, companies will produce products

and services on demand. %xample: a computer company can tae orders

over the Internet for a computer and build the computer according to your

specification. 3omputers will be delivered within a designated time period.


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- ass-customiation: customized orders are fulfilled using efficient

procedures and processes. %xample companies produce a large 5uantity of

items but customize them to fit the desire of each customer.

- ustomer 4ocus Strategy: companies will be able to provide good customer

service, anticipate their future needs, respond to customer concerns and

prevent losing customers to competitors.

- Electronic Business an# E commerce: Doing business electronically,

%commerce describes the process of buying, selling, transferring, or

exchanging products, services and2or information via computer networs,

including the Internet. %-business refers to a broader definition of e-

commerce, not 6ust the buying and selling of goods and services, but also

servicing customers, collaborating with business partners, conducting e-

learning and processing electronic transactions.

- Business &lliances: 1any companies have alliances and business linages

with other companies for effective collaboration to reduce riss and costs.

%xample: airline and hotel chains

- Data management: data managed through life cycle, data management in

security, 5uality. Data is well secured.

1.5. IT De%eloments an# Tren#s

IT De%eloment 6 tren#s: 7 areas of development in I/

$ eneral De%eloment:

- 3ost decrease, performance increase

8uge increases in computer processing capacity and sharp decline in

cost.

- 9torage capacity will increase dramatically

- 1ultimedia use increase especially virtual reality

- 3omputers will be increasingly compact and more portable

- ush for open architecture eg. 0pen source- Intelligent systems such as expert system are embedded in other

system.

- lug and play software increase. 9oftware as a service

$ 7et8or' comuting #e%eloments:

- 9torage networ. 1any corporations are relying on outside server to

manage their technology, which they can access via the web

- 1obile and wireless computing will be a ma6or component of I/


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- 0ptical computing will increase networ capacity. /hese high capacity

telecommunication networs will convert signals to colours of light and

transmit this over fiber ;optic filaments !ca#p 5uang$

- /he use of internet will grow

- %-commerce changing businesses

-


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- =eal time processing: processing is transaction data are processed

immediately after the transaction occurs. %xample airline booing

system

? ffice &utomation System (&S):

0'9 refers to a set of office-related systems used to increase the

productivity of office worers and enable worers to interact and wor

together more efficiently. %xample: end and receive email, video meeting

? anagement Information Systems (IS):

1I9 access, organize, summarise and display information in supporting

routine decision maing in the functional areas. 1I9 are characterized mainly

by their ability to produce periodic reports such as a daily list of employees

and hours they wor, or a monthly report of expenses.

? 9no8le#ge anagement Systems (9S)are nowledge ;based information

systems that support the creation, organization and dissemation of business

nowledge to employees and managers throughout a company.

? Decision Suort Systems (DSS): is a computer-based system designed to

assist a manager or decision maer in maing decisions. %xample:

advertising manager may use D99 to analysize as a part of a decision to

define ad budget.

? Intelligent Suort System (ISS): applies artificial intelligence !'I$ techni5ues

to business information systems. 'I is a system that can perform intelligentproblem solving. 0ne application of 'I is the expert system. %xpert systems

!%9s$ provide the stored nowledge of experts to non experts, so that the

latter can solve difficult or time consuming problems in the absence of the

expert.

/ E!ecuti%e Suort system (ESS):

%99 is called %xecutive Information 9ystem !%I9$, %I9 are information

systems that combine many features of 1I9 and D99. /he focus of %I9 was

on meeting strategic information needs of top management. %I9 is used by

managers, analyst and nowledge worers.

*.5 Suly hains an# Enterrise Systems:

? Suly chain: divided into @ parts

( Ustream Suly hain (ca t;< nguo=n):

It includes the organizations fist- tier suppliers and their suppliers. I/

supports the upstream supply chain by improving the procurement activities.


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%xample: In 1alaysia all government agencies use e-procurement to do

purchasing. /ransaction between government and suppliers will be done

online to save cost and time.

$ Internal Suly hain:

It includes all the processes used by an organization in transforming

the inputs of the suppliers to outputs. %xample: company uses selected

supply chain management !931$software to connect suppliers, distributors,

customers and other partners.

$ Do8nstream Suly hain:

It includes all the processes involved in delivering the products to final

customers. I/ supports Down 9upply 3hain in 7 areas: customer relationship

management !3=1$ and order taing and shipments. %xample: prompt

shipping and delivery

? Enterrise System: is an information system that includes the entire

enterprise, implemented on a company wide networ. I/ system such as

/ransaction rocessing 9ystems !/9$, %nterprise =esource lanning

9ystems !%=$, 3ustomer =elationship 1anagement !3=1$, 0ffice

'utomation, Intranet and etc. can support an enterprise by providing high-

5uality, consistent I9 services throughout the organization. %xample: %= not

only conducts common business transaction but plans and manages

resources of an enterprise.5. anagerial Issues

=ecognizing opportunities for using It and the new way to compete and

conduct business, locally and globally

Who will build, operate and maintain the information systemsA 8ow

important is I/ to organizationsA

%thics !Ba+o BC#c$ and social issues. /he implementation of I/ involves

many ethical and social issues.


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TOPIC 2 IT INFRASTRUCTURE

1. Data anagement:

's a ma6or organizational resource, data have to be managed and organized

lie any other company asset. It must be available when re5uired and must

be current support ad hoc business decisions. 'n important activity of data

management is receiving data from 5uality sources.

'ppropriate data management serves to maintain data more efficiently and

effectively as well as to increase their value.

( roblems during organizational data management:

-


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- ' field: logical grouping of characters into a word, a small group of

words.

- ' record: logical group of related fields such as students name, date

etc.

- ' database: a logical grouping of related files. %xample students

database.

- ' primary ey: is re5uired to retrieve, update, and sort the records in a

file.

' secondary ey may also be re5uired to locate a particular record.

? ile 0rganization and 'ccess 1ethods:

9e5uential !lieEn tieFp$ file organization: the records must be

retrieved in the same physical se5uence in which they are stored

!such as in the operation of a tape or video recorder. 1agnetic

tapes utilize this form of file organization.

Direct or random file organization: the data records can be retrieved

in any se5uence, without regard to how they are being stored

physically in the storage medium. 1agnetic diss use direct file

organization.

/wo methods of file access: the indexed se5uential access method

!I9'1$ and the direct access file method. I9'1 uses an index of ey

fields to locate individual records. =ecords are stored on dissaccording to their ey se5uence. /he direct access file method uses

the ey field to locate the physical address of a record.

+roblems 8ith the Tra#itional 4ile En%ironment

%ach functional area in an organization tends to develop systems

independently from other functional areas. unctional areas lie accounting,

human resources, finance, manufacturing and sales and mareting all

develop their own systems, applications and data files.+roblems 8ill result:

Data re#un#ancy an# inconsistency: Data redundancy is the presence of

duplicate date in multiple data files. Data inconsistency is the presence

of different values for same attributes when data redundancy occurs.

Date an# rogram #een#ence: Date and program dependence leads to

#ata isolation whereby data files are organized differently, stored in

different formats and physically inaccessible to other programs.


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?ac' of #ata sharing: It is virtually impossible for information to be

shared or accessed in a timely manner if information cannot flow freely

across different functional areas of the organization.

Infle!ibility: ' traditional file system can deliver routine scheduled

reports after extensive programming but is unable to deliver ad hoc

reports or respond to unanticipated information re5uirements in a

timely manner.

+oor #ata security: Data security is difficult to enforce in the file

environment because new applications may be added and more people

may have access to data as a result of the new applications. 9ecurity

will be poor as there may not be ade5uate control, monitoring and

management of the data.

1.* Data ?ife ycle +rocess

Data, information and nowledge

Data: are the raw materials for data processing. Data can be numeric,

alphanumeric, figures, sounds, or imagine. Database consists of data item.

%xample data is a student grade in a class

Information: is data that have been processed in a such a way as to be

meaningful to the person who receives it. Data items are processed into

information by means of an application, %xample an university online

registration system.

9no8le#ge: is data and2or information that have been organized and

processed to convey understanding, experience, accumulated learning, and

expertise as they apply to a current problem or activity.

? Data life cycle process is explained in terms of the following G areas:

- Data sources

- Data collection

- Data storage- Data analysis

- =esults and solutions

a) Data Sources:

Internal Data: it is organizational data bout personnel, products, services and

processes. /his data is accessed via intranet of organization. 9ome data is

stored in one location and some data is stored in many locations.


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/he data in a file can be 5uicly entered and ept more accurately.

? & #ulicate or relicate# #atabase: has completed copies of the entire

database in many locations. /his offsets the single point of failure problems

dominant in centralized databases as well as increases user access

responsiveness.

/he limitation to this type of distributed database is that overhead costs are

significant as consistency has to be maintained among the replicateddatabases as records are added, modified and deleted.

Database anagement Systems

Data anagement Systems (DBS)refer to a group of programs that provide

access to a database. D19 allows organization to facilitate the centralization of

data and perform data management more efficiently. It permits access to stored

data by application programs from many different users.

D19 acts as interface between application programs and physical data files,

provide a logical and physical views of database data:

-/he logical view depicts what is in the database. Hogical views allow users to

view database information according to business needs.

- /he physical view depicts how the data is physically organized in the

database. Data specialists use the physical view to mae efficient use of the

storage and processing resources.

D19 including:

!i$ /he #ata or #atabase mo#eldefines the conceptual blueprint of the data

structure. %xample: common databases models

!ii$ /he#ata #efinition language(DD?)provides the lin between logical and

physical views of the databases. D19 users can define the physical

characteristics of each record, the fields within a record, data type and

character length.

!iii$ /he #ata maniulation language (D?) contains commands that permit

D19 users to manipulate the data in the database. sers can retrieve

data, sort and display as well as delete database contents to satisfy

information re5uests or develop applications.

!iv$ ' data dictionary essentially provides a repository of metadata for

each data element. ' metadata is data about data and a data element

represents a data field.

/ypical uses of data dictionaries are:

8elp reduce data inconsistency and increase data reliability

owing to standardized definitions for all data elements.


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9peed program development as programmers do not need to

create new data names.

%ase modification of data and information.

ommon Database o#els

/he structure of the relationships in most databases follows one of the three

logical database models:

( ' hierarchical model

( ' networ model is an expansion of the hierarchical model as it provides

many-to-many logical relationship.

( /he relational model describes data using a tabular format.

Data @arehouse

' data warehouse is a repository of sub6ect-oriented historical data that are

organized to be accessible in a form readily acceptable for analytical processing

activities. 'nalytical processing involves analysis of accumulated data by end

users.

' data warehouse is a database that collects business data from existing

corporate databases in the organization as well as from external sources.

/o create a data warehouse, a company pulls data from its operational systems

and puts the data in a data warehouse so that users may access and analyze the

data without endangering the operational systems.

In warehouse, the data is organized in a sub6ect-oriented form. Data warehouses

provide for the storage of metadata.

aAor characteristics of #ata 8arehousing:

rganiation: Data organized by sub6ects !vendor, products, price level

etc.$ and contain information relevant for decision support only.

onsistency: Data in different operational databases may be encoded

differently !e.g gender data may be encoded J and K in one operational

system and m and f in another.

Time %ariant: Data ept for many years, they can be used for trends,

forecasting, and comparisons over time.

7on%olatile: 0nce entered into the warehouse, data are not updated.

3elational: /ypically the data warehouse uses a relational structure.

lient0ser%er: sing the client2server architecture mainly to provide the

end user an easy access to its data.

@eb-base#: designed to provide an efficient computing environment for

Web-based applications.

Integration: Data from various sources are integrated.


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3eal time: 'rrange for real-time capabilities.

Data art:

' data mart may be a subset or a smaller version of a data warehouse to be of

use to small and medium-sized businesses and to departments within larger

companies.

Data marts contain a subset of the data for a single aspect of a companys

business!finance, inventory or personnel$ who want to access detail data.

Data mart is useful for smaller group of users, has shorter lead time for

implementation, provides local control, has faster response time and is easier to

navigate warehouses. Data marts allow a business unit or a department to build

its own decision support systems.

@eb-Base# Data anagement Systems

Data management and business intelligence activities are often performed with

Web tools or are interrelated with Web technologies and e-business. ser with

browsers can log onto a system, mae en5uiries and get reports in a real time

setting. /his is done through intranets and for outsiders via extranet.

%lectronic commerce software vendors are providing Web tools that connect the

data warehouse with electric commerce ordering and cataloging systems.

%lectronic maretplaces provide additional avenues for manufacturers and

suppliers to communicate and conduct business transactions.

/he Web- based system is accessed via a portal and connected to the following

parts:

-/he business intelligence services

- the data warehouse and marts

- the corporate applications and

- the data infrastructure

#) Data &nalysis:

0nce the data are in the data warehouse, and2or data marts, users !lie managers,

analysts$ can retrieve a copy of the re5uired data for analysis. atterns are

analyzed from the retrieved data through the use of data analysis and data mining

tools. 'nalysis activities area generally referred to as analytical processing or

business intelligence.

( Business intelligence: (BI)is a broad category of applications and techni5ues for

gathering, storing, analyzing and providing access to data. It helps enterprise users

mae better business and strategic decisions.

aAor alications: the activities of 5uery and reporting, online analytical processing

!0H'$, decision support system !D99$, data mining, forecasting and statistical

analysis.


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I tools can be divided into categories:

- Information and nowledge discovery

- Decision support and intelligent analysis

i) Information an# 'no8le#ge #isco%ery:

/he process of extracting useful information and nowledge from volumes of data is

nown as nowledge discovery in databases !LDD$ or nowledge discovery.

Information and nowledge discovery tools include:- hoc ueries: 'd hoc 5ueries allow users to re5uest, in real time, information

from the computer that is not available in periodic reports.

- nline analytical rocessing (?&+): 0H' is a set of tools that analyze and

aggregate data to reflect business needs of the company. 0H' involves

examining many data items in complex relationships, is performed on data

warehouses and marts.

- Data mining: Data mining is a tool for analyzing large amounts of data. Data

mining technology can generate new business opportunities by providingautomated prediction of trends and behaviors and automated discovery of

previously unnown or hidden patterns.

- @eb mining: is the application of data mining techni5ues to discover

actionable and meaningful patterns, profiles, and trends from data related to

the World Wide Web.

ii) Decision Suort an# Intelligent &nalysis

I technologies used to directly support decision maing including:

- Decision suort system (DSS): D99 is a computer-based information system

that combines models and data in an attempt to solve semi-structured and

unstructured problems with user involvement. %very D99 consists of at least

data management, user interface, model management components and the

end users.

- E!ecuti%e (Enterrise) suort system (ESS): an %99 is a technology designed in

response to the specific needs of top level managers and executives.

- rou #ecision suort system (DSS): the MD99 methodology was initially

designed to support individual decision maers. MD99 supports a decision

room group whose members are in one place and a virtual group, whose

members are in different locations.

- Intelligent system (IS): Intelligent system is a term that describes the various

commercial applications of artificial intelligence !'I$. /he ma6or intelligent

systems are expert systems, intelligent agents, robotics and sensory

systems, neural computing, speech understanding, natural language

processing, computer vision and scene recognition.


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Timeliness: Information produced from data that are available at right time

will significantly impact the outcome of a business decision.

&ccessibility: /he importance of data accessibility cannot be overemphasized.

Data is considered to have integrity !nguyNn vn) when it is whole, complete and

unchanged while in data storage or transmitted.

b) Document Management:

Document management is seen as a solution to problems faced by organizations to documentation.Document management is the automated control of electronic documents, page images, spreadsheets

throughout their entire life cycle within an organization.

Benefits of document management: greater control over the production, storage and distribution of

documents and greater efficiency in the reuse of information.

*. 7et8or' omuting 4or ollaboration

*.17et8or' omuting: networ is a communication system that allows users to

send and receive messages and share common resources.


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ii) 7et8or' Toologies:

refers to its physical layout and connectivity. Devices connected to a networ

are called nodes. 3ommon topologies are bus, star and ring

In a bus topology, all networ nodes connect to a bus, which is a single

communications channel.

In a star topology, all networ nodes connect to a central hub, typically

the file server, which facilitates communication btw the nodes

In a ring topology, networ nodes are connected to ad6acent nodes to

form a close loop.

b) 7et8or' omuting Infrastructures:

/he ma6or networ computing infrastructure include the Internet, the Web, value-

added networs, intranets and extranets.

i$Internet: as the information superhighway, is a global networ of computer

networs that enables people to access data in distributed business units or in other

organizations and to communicate, collaborate and exchange information 5uicly,

inexpensively and seamlessly worldwide.

/ransmission 3ontrol rotocol2Internet rotocol !/32I$ are two best nown

elements of the Internet protocol suite. Internet is become a necessity in the digital

economy.

ii$ @eb:/he Web !World Wide Web or WWW$ is a system of universally

accepted standards for storing, formatting and displaying information via a client2

server architecture.

iii$ alue-a##e# net8or's (&7s): O'


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a) Disco%ery: is a category of commercial applications supported by the Internet. /he

discover capability can facilitate education, government services, entertainment

and commerce. ' ma6or problem of discovery is the amount of information on the

Internet and intranet that is growing rapidly.

Search enginesand intelligent agentsare some common search tools and Internet

technologies that deliver customized information to users.

i)Search engines:/hese are search tools for locating specific sites orinformation on the Internet.

- 9earch the Internet based on ey words or terms

- eep an index of the words they find

- 'llow users to search words or combinations of wors found in that index.

%xample: google, yahoo !www.yahoo.com$

ii$ Intelligent agents: Intelligent agent technology is useful in searching

through large amounts of data to locate only information that is considered

important and, in some cases, acting on that information on behalf of the user. /heyare software programs that carry out specific, repetitive and predictable tass for

individual users, business process or software application without direct human

intervention. %xample intelligent agent application is the Wizards in 1icrosoft 0ffice

software tools.

Information portal:

-ommercial (ublic) ortals: offer content for diverse communities and are the

most popular portals on the Internet. %g. Pahoo.com, msn.com

- +ublishing ortalsare intended for communities with specific internets egtechweb.com

- +ersonal ortalstarget specific filtered information for individual

- &ffinity ortalssupport communities such as hobby groups or a political

party

- obile ortalsare portals accessible from mobile devices.

- ororate ortalsprovide single-point access to specific enterprise

information and applications available on the Internet, intranets and extranets to

employees, business partners and customers.

b)ommunication: /he Internet provides communication channels that are fast and

inexpensive, and includes information transfer and processing. 3ommunication as

an interpersonal process of sending and receiving symbols with messages attached

to them. Information technology plays a significant role in providing communication

support for organizations.

I/ provides communication support to a specific organization or a group or users as

below:
http://www.yahoo.com/http://www.yahoo.com/


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+articiants: 9ender and recipients of information


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Oirtual collaboration or electronic collaboration refers to the use of digital

technologies that enable individuals or organizations to collaboratively plan, design,

develop, manage, and research products, services and innovative applications.

%xample: information sharing btw retailer and their suppliers, lower transportation

and inventory costs.

iii) ollaboration-enabling tools

9ome common collaboration-enabling tools and technologies: @or'flo8 technologies: refer to the movement of information through

the se5uence of steps that mae up an organizations wor procedure

or business processes. Worflow management is the automation of

worflows from start to finish.

rou 8areare software products that support groups of people who

share a common tas or goal and who collaborate on it

accomplishment. Mroup ware products are follows:

-Electronic meeting system: attempt to improve face to face meetings

with their electronic counter part.

- Electronic teleconferencingis the use of electronic communication that

allows two or more people at different locations to have a

simultaneous conference.

- i#eo teleconferencing: where participants in one location can see

participants in other locations

- @eb conferencingis videoconferencing solely conducted on the

Internet.

- 3eal-time collaboration (3T)tool that help companies bridge time and

space to mae decisions and to collaborate on pro6ects.


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'll three dimensions are physical, as indicated by the lower-left shaded cube in the

diagram. 0rganizations that display purely physical dimensions are termed as bric'-

an#-mortar organiations. 3ompanies that are engaged only in %3 activities are

considered virtual or pure-play organizations. %xample purchase a boo from

'mazon.com or a shirt from Wal-1art 0nline, it is partial %3.

b) Brief >istory of E:

'pplications of %3 were first developed in the early KRSJs with innovations ofelectronic funds transfer !%/$ and later, electronic data interchange !%DI$. In %/,

funds could be transferred electronically to settle accounts btw bans and other

businesses. %DI bought in a technology to electronically transfer documents such as

purchase orders, invoices, and electronic payments btw firms doing business.

In early KRRJs, as the Internet became more commercialized, users floced to

participate in the World Wide Web !WWW$. %3 applications rapidly expanded

primarily owing to the development of new networs, protocols, software and

specifications.c) E 4rame8or':

/here are many %3 applications, as may be seen at the top part of the framewor.

/o execute these applications, companies need the right information, infrastructure

and support services. %3 applications are supported by an infrastructure and five

support areas.

ive support areas:

- eople: seller, buyer, intermediaries, information system specialists, other

employees etc.

- ublic policy: legal and other policy and regulating issues

- 1areting and advertising: %3 often re5uires the support of mareting and

advertising.

- 9upport services: 1any services are needed to support %3

- usiness partnerships: Toint ventures, electronic maretplaces and

partnerships are some of fre5uently occurring relationships in e business.

'll these %3 components re5uire good coordination and management practices

to unify applications, infrastructure and support.

#) The Structure of E:

/he basic idea of %3 is to automate as many business processes as possible. '

process can be an order initiation, order fulfillment, procurement of materials,

the manufacture of products, delivery, or providing customer relationshi

management!3=1$. 3=1 is a customer service approach that focuses on building

long term and sustainable customer relationships that add value both for the

customer and the company.


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%3 mechanisms:

- %lectronic marets !emarets$ are online maretplaces where buyer, sellers

meet to exchange goods, services, information

- %lectronic procurement !e-procurement$ is the electronic ac5uisition of goods

and services for organizations.

- %lectronic 3=1 !e 3=1$ refers to the use of Web browsers, Internet and other

electronic mechanisms to manage customer relationships.- artner relationship management !=1$ is a business strategy that focuses

on providing comprehensive 5uality service to business partners.

- %mployee relationship management !%=1$: is the use of Web-based

applications to streamline the human resources process and to better

manage employee.

- %lectronic learning !e learning$ is the online delivery of information for

purpose of education, training, nowledge management or performance

management.- %nterprise resource planning !%=$ of enterprise system refers to software

that integrates the planning, management and use of all resources

- 9upply chain refers to the flow of materials, information, funds, and services

from raw materials suppliers through factories and warehouses to the end

customers.

- 0rder fulfillment: refers to all the activities needed to provide customers with

ordered goods and services, including related customer services.

1ost %3 activities are done over the Internet but it can conducted via O'


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onsumer-to-businesses (*B). 37 %3 re5uires that consumers mae nown a

particular need for a product or service and suppliers compete to provide it to

the consumers.

Intrabusiness (intraorganiational) E. 'n organization uses %3 internally to

improve its operations. Intrabusiness %3 include all internal organizational

activities that involve the exchange of goods, services, or information among

various units and individuals in that organization.

o%ernment-to-citiens (*). ' government entity provides services to its

citizens via %3 technology. M7M: government-to-government

obile commerce (m-commerce). When %3 transactions and activities are

conducted in a wireless environment. Hocation-based commerce !l-

commerce.

f) E Business an# 3e%enue o#els:

' business model is a method of doing business by which a company can generate

revenue to sustain itself.

nline, #irect mar'eting. 1anufacturers or retailers sell directly online to

customers

Electronic ten#ering systems. Harge organizational buyers do purchase by

tendering. 7 %3 is used with a reverse auction mechanism.

nline &uctions. /his business model is favorable for 73 and 7 %3.

3ompanies and individuals run many types of online auctions.

7ame your o8n rice. 'llow customers to set the price they are willing to pay

for a specific product or service.

4in# the best rice: ' customer specifies a need and then intermediary

compares providers and locate the lowest price.

&ffiliate mar'eting. Oendors mae arrangements with partners !business,

organization or individual$ to place logos or banners on the partners Web

site.

iral mar'eting. Is a word or mouth mareting in which customers promote a

product or service to friends or other people using the Internet. rou urchasing. Is getting many small buyers together to buy in large

5uantities in order to obtain a discount on the products purchased.

+ro#uct an# ser%ice customiation. 3ustomization is the creation of a product or

service according to the buyers specifications.

Electronic mar'etlace an# e!change. %lectronic maretplace provides

significant benefits to both buyers and sellers.


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Suly chain imro%ers. %3 has contributed to the creation of new models that

change or improve supply chain management.

Information bro'ers an# matching bro'ers. /hese broer or intermediaries

provide services related to %3 information as trust, content, matching buyers

and seller.

alue-chain ser%ice ro%i#ers. 0ffer specialized services in supply chain

operations such as providing logistics or payment services.

ommon re%enue mo#elsin %3

/ransaction fees. /ransaction fees refer to the commission a company

receives based on the volume of transactions made, %xample: when you sell

a house, you pay broer transaction fees.

9ubscription fees. 3ustomers pay a fixed amount, usually monthly, to get

some type of service, %xample access fees to O


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/here are several types of e-maretplaces:

%lectronic storefront !e-storefront$ refers to a single companys Web site

where products and services are sold. It can be classified as general or

specialized. %xample 'mazone.com

'n electronic mall !e-mall$ is an online shopping center under one Internet

address where many stores are located.

In 7 environment, there are @ ma6or e-maretplaces

+ri%ate e-mar'etlacesare owned by a single company, generally a large

corporation. ' sell-side e-maretplace can be identified by its one-seller and

many buyer characteristics. ' buy-side e-maretplace is a company that

conducts purchasing only from invited suppliers.

+ublic e-mar'etlaces are usually owned and managed by an independent third

party. /hey are 7 marets that include many sellers and many buyers.

onsortia (or consortium, singular) are formed when a small group of ma6or

industry buyer comes together to create an e-maretplace to deal with

suppliers in the same industry.

b) Electronic atalogues:

3atalogues have traditionally been printed on paper. 'n electronic catalogue !e-

catalogue$ is the presentation of product information in an electric format. %

catalogues can be searched 5uicly with the help of search engines.

'n e catalogue system consists of a product database, directory and search

capability and a presentation function.

c) Electronic &uctions

%lectronic auctions are auctions that are conducted online. /he Internet opens many

opportunities for e-auctions. 'uctions can be conducted from the sellers site, the

buyers site, for a third partys site !%bay$. /hey increase revenues for sellers by

broadening the customer base and shortening the cycle time of the auction. uyers

benefit by opportunities to bargain for lower prices and convenience of bidding.

0nline auctions are used in 73, 7, 37, 373, M73 and M7 %3.

/wo ma6or types of e-auctions:

i$ orward auctions are auctions that sellers use as a selling channel to many

potential buyers. /he highest bidder wins the items !ebay$.

www.heya.com.vn

ii$ =everse auctions. =everse auctions have one buyer, usually an

organization that wants to buy a product or a service. 9uppliers are invited to

submit bids. 9everal rounds of bidding may tae place until the bidders do not

reduce the price, the lowest price will win bids.

#) Electronic Bartering
http://www.heya.com.vn/http://www.heya.com.vn/


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artering refers to an exchange of goods and services and is the oldest method of

trading. %lectronic bartering is bartering conducted online. /wo forms of e-bartering:

individual ; individual and corporate e-bartering. In individual-to-individual, e

bartering is done through means of advertisement that appear in some newsgroups,

bulletin boards and chat rooms.

1.5. B* E &licationsa) Electronic 3etailing: ' retailer is a sales intermediary that operates btw

manufacturer and customers. Done through home shopping catalogue, television

shopping channels.

%-retailing is the direct sale of products through e-storefronts or e-malls, and is

usually designed around an electronic catalogue format and2or auctions.

b) Ser%ice In#ustries in B*

Electronic ban'ing: including various baning activities conducted from home

or a business instead of at a physical ban.

International an# multile-currency ban'ing: International baning and the ability

to handle trading in multiple currencies, transfers of electronic funds and

electronic letters of credit are critical for international trade.

nlinesecurity tra#ingcan be placed from anywhere and at any time

nline Aob mar'et: the Internet offers a perfect environment for 6ob seeer and

for companies searching for candidates.

Tra%el ser%ices: /he Internet is an ideal place to plan, explore and arrange

almost any trip.

3eal estate: =eal estate transactions are an ideal area for e-commerce.

c) ustomer Ser%ice:

3ustomer service is a series of activities designed to enhance customer satisfaction.

9ome examples of online customer services:

%lectronic mails are used by companies to send confirmations, product

information and instructions to customers and also tae orders, complaints

and other in5uiries.

9ome companies mae available tracing facilities for customers to trac

online the status of their accounts, orders, services or 6ob application

9ome companies provide user friendly tools for customers to self-configure

their individualized pages at the vendors site.

In company-sponsored online chat rooms or discussion board.


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When an established company decides to sell directly online, it may create a

conflict within its existing operations in areas such as pricing, services, allocation of

resources and logistics support.

iii) rganiing or#er fulfillment an# logistic:

%-tailers face a difficult problem of how to ship small 5uantities to a large number of

buyer. I/ supported decision models can help with scheduling, routing, shipments,

inventory management, and other logistics-related decisions.i%) Determining %iability an# ris' of online e-tailers:

Due to ease of entry to e-maretplaces, e-tailers face fierce online competition

especially in commodity-type products such as 3Ds, toys, boos, or groceries.

' decision support system !D99$ modeling can be helpful in such cases.

%) I#entifying aroriate re%enue mo#els:

1any dotcom companies were selling products at or below cost, with the ob6ective

of attracting many customers and advertisers to their Websites.

1.". B*B E &lications:1any business models for 7 %3 applications> they are sell-site 7 maretplaces,

buy-side7 maretplace, electronic maretplaces or exchanges and collaborative

commerce.

a) Sell-Si#e ar'etlaces

It is a web-based maretplace in which one company sells to many business buyers

from e-catalogues or auctions, fre5uently over an extranet. 9uch sellers are Intel,

Dell etc.

In 7 sell ;side maretplace the buyer is an organization. %3 is used in this model

to increase sales, reduce selling and advertising expenditures, increase delivery

speed and reduce and reduce administrative costs.

b) Buy-Si#e ar'etlaces: 0rganizations attempt to buy needed products or services

from other organizations electronically, usually from their own private e-

maretplace.

/his buy ;side maretplaces use re%erse auctionsand electronic rocurement metho#s.

i$' ma6or of buying products and services in the buy-side model is a

re%erse auction

ii$ Electronic rocurementis the electronic ac5uisition of goods and services

for organizations. esides reverse auctions, e-procurement uses two other

mechanisms:

rou urchasing: is aggregation of orders from several buyers

into large volume purchases so that better price can be

negotiated from sellers.


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Des'to urchasing: Destop purchasing is most suitable for

1=0s !maintenance, repair, operations$ indirect items such as

office supplies, or light bulbs.

a$ Electronic E!changes: %-exchanges are 7 e-maretplaces or trading

venues open to all interested parties and are usually owned and managed

by third parties. 'll exchanges share one ma6or characteristic which is that

they are an electronic trading-community meeting place for many sellersand many buyers, and possibly for other business partners.

/he exchanges depend on two dimensions:

/ypes of materials traded

9ourcing strategies used

Tye of materials: Direct materials: materials used in the production of a

product !paper in boos, steel in a car$. In#irect materialsor 1=0s are used to

support products !office supplies, light bulbs$

Strategic sourcing: deals with purchasing done in long-term supplier- buyer

relationships. Sot sourcing: refers to the purchase of goods and services as the

need arises. 9pot sourcing involves #ynamic ricing.

/wo types of electronic exchanges:

- Oertical exchange: which deals with materials from one industry or industry

segment ex: plastic, steel

- 8orizontal exchange: that handles materials and services traded in several

different industries.

b) ollaborati%e ommerce:

3ollaborative commerce refers to collaboration btw business partners to use digital

technologies to enable collaborative planning, designing, developing, managing and

researching of products, services and innovative %3 applications.

1.F. E Suort Ser%ices:

%3 support services include

%-infrastructure !mostly technology, consultants, system developers and

integrators, hosting, security, wireless and networs$

%-process !mainly payments and logistics$

%-marets !maring and advertising$

%-communication !different audiences and business partners$

%-services !3=1, =1 and directory services$

%-content !supplied by content providers$

a) ar'et 3esearch:


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1aret research is needed for product design, mareting, and advertising,

decisions, pricing, and strategy. urpose of maret research is to find information

and nowledge that describes the relationships among consumers, products,

mareting methods and mareters.

1aret researchers have tried to understand consumer behavior and develop

models to help vendors understand how a consumer maes a purchasing decision.

'sing customers what they want 0bserving customer behavior on the Web: /he Web is a rich source of

business intelligence and many companies are building data warehouses that

capture the nowledge contained in clic stream data that is obtained from a

companys Web sites.

%i) Bran#-an# %en#or-fin#ing agents an# rice comarisons:

When the consumer has decided what to buy, a type of intelligent agent called a

comparison agent will help in doing comparisons.

%ii) Search agents: Intelligent agents help customer to by specific need. What

products best fits their profile and re5uirements.

%iii) ollaborati%e filtering agents: intelligent agents use customer data to infer

customer interests in other products or services.

b$ nline %ertising: 1any methods of internet advertising, effectiveness

and cost-6ustification of the advertisement

i$Banners: a graphic display advertising display on a Web page. /hey are

electronic billboards

ii$ +o-u, +o-Un#er an# Similar s: these adv are contained in a new

browser window that is automatically launched when one enters or exists a

Website.

iii$E-mail %ertising: combine with audio or video clips, cost effective, it is

online advertising and mareting channels.

iv$ Electronic catalogues an# brochures: rovide information on products and

services.

0nline advertising:

Unsolicite# a#%ertising: 3hu dong 5uang cao, electronic message without

permission of the receiver: 9pamming

+ermission a#%ertising: accept online advertising and email, permission

mareting is very important for maret research.

iral mar'eting: Word-mouth mareting, customers promote a product or

service by telling others about it.

Interacti%e a#%ertising an# ar'eting: 5ung c!o t"#ng t!c: $dvertisers in interactive

advertising attempt to target their ads to the desired mar%et and to the invidiual.


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On-line Promotions: & ways to attract visitors to a 'ebsite:

-Improve the companys raning one the search-engine list.

- 3onduct line events, promotions and attractions to attract customers.

c$ Electronic +ayments: in online environment, electronic payment methods are used

to mae purchases.

9ecurity in electronic payments:

i$'uthentication: Xac nhan la dungii$ Integrity:

iii$


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- 9hort 1essage 9ervice !919$

- %nhanced 1essaging 9ervice !%19$

- 1ultimedia 1essaging 9ervice !119$the next generation of wireless

messaging

- Mlobal ositioning 9ystem !M9$

- 9mart phones

- luetooth: designed for temporary, short range data and voice

coonection among mobile devices and other devices.

- Wireless 'pplication rotocol !W'$

- Wireless idelity !Wifi$

- Wireless Hocal 'rea


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c) obile 7et8or's: 7 types of mobile networs: wide area and local area

networs

i$ @ireless8i#e area 7et8or's (@@&7s): Wide are networs for mobile

computing are nowns as wireless wide area networs !WW'


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- 1obile portals

c) obile B*B &lications:

1obile computing solutions that are being applied to 7 and supply chain

management, enable organizations to respond faster to disruptions by

shifting resources related to critical events as they occur.

". ?ocation Base# ommerce

Hocation-based commerce !l-commerce$ refers to localization of products

and services, offer opportunities to meet customers needs such as:

- 9afety: example: user can connect emergency service with a mobile

devices

- 3onvenience

- roductivity: example optimize your travel and time

ive ey areas i-commerce services are associated:

- Hocation. H commerce help determine the basic position of a person or

a thing !car, boat$

-


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Topic 4: Organizational Applications4.1 FUNCTIONAL APPLICATIONS AND TRANSACTION PROCESSING

4.1.1 Functional Information Syt!m "IS#

IS are composed of multiple subsystems, each providing information for various tasks

ithin the function!

The ma"or functional areas are: accounting, finance, production#operations, marketing,

$%,&

C$aract!ritic of Functional Information Syt!m%

'omposed of smaller systems

Integrated or independent

Interfacing

Supportive of different level of IS applications: operational, managerial, and strategic

4.1.& Tranaction Proc!in' Information Syt!m "TPS#


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T(S is a system that records company transactions, in hich a transaction is defined as

an e)change beteen to or more business entities!

The specific ob"ectives of a T(S may include:

To allo for efficient and effective operation of the organization

To provide timely documents * reports

To increase the competitive advantage of the corporation

To provide the necessary data for tactical and strategic systems

To ensure accuracy and integrity of data an information

To safeguard assets and security information

4.1.( Int!'ratin' Functional Information Syt!m

Systems that are isolated from other internal systems often create comple) problems!

+usinesses should plan for an integrated system rather than standalone systems!

-): -%(

4.1.4 Sy))y C$ain%

The section covers the filling and delivery of customer orders, including innovative

solutions, timely delivery, returns, and managerial issues!

4.& ESSENTIALS OF ENTERPRISE S*STE+S AND SUPPL* C,AINS

-nterprise systems are systems or processes that involve the entire enterprise or ma"or

portions of it!

The enterprise systems are the integration of supplychain related systems, business

systems, and the process#product systems!

Supplychain related systems

.aterials re/uirement planning 0.%(1, hich facilitates the plan for purchasing or

producing parts, subassemblies, or materials in case of interdependent items!

.anufacturing resource planning, hich adds functionalities to a regular .%( system by

determining the costs of parts and the associated cash flo! It also estimates costs of

labour, tools, e/uipment repair, and energy hile generating a re/uirements report!

S'., hich manage the endtoend process!

-%(, hich supports internal supply chain!

+usiness systems

2ecision support systems 02SS1, hich supports decision making throughout the

enterprise!

3noledge management system 03.S1, hich support knoledge creation, storage,

maintenance, and distribution throughout the enterprise!

Intelligent system 0IS1, hich includes a knoledge component, such as e)pert system

and neural netork!


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.anaging ebusiness

.anaging ogistics

.anaging Inventory

Inventory eprocurement

.anaging collaboration

.anaging other ITassisted solutions: supply chain teams, virtual factories, ireless

solutions

4.&.( Ent!r)ri! R!ourc! Plannin' "ERP# Syt!m

-%( serves as a crossfunctional enterprise backbone that integrates and automates

many internal business processes * information systems ithin the manufacturing, financial,

$%, corporate services, customer#product, and supply chain! This softare integrates the

planning, management, and use of all resources in the entire enterprise!

Some top reasons hy -%( installations fail are:

7nrealistic e)pectation!

Inability to map business processes

Inaccurate data

8ailure to factor in hidden costs!

Things that need to be done hen implementing an -%( programs:

'reate a steering group ith a strong e)ecutive champion

9et help from consulting team

Set e)pectations and manage the pro"ect effectively

.anage the change in the organizations

-nable infrastructure to support the change!

'ommunicate to all interested parties

4.&.4 /uin! Proc! +ana'!m!nt "/P+#

+(. refers to activities performed by businesses to optimize and adapt their processes!

+enefits of +(.:

%educe product design by ;


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$elp organizations achieve gains of ?


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9lobal Information Systems are IOSs that connect companies located in B or more

countries! These systems help companies share information freely across national boundaries

through the use of telecommunications

'ultural differences

ocalization

-conomic and (olitical 2ifferences

egal Issues

.a"or benefits of 9lobal Information Systems:

-ffective communication at a reasonable cost!

-ffective collaboration to overcome differences in distance, time, language, and culture!

Access to databases of business partners and ability to ork on the same pro"ects hile

their members are in different locations!

4.(.( Partn!r R!lation$i) +ana'!m!nt "PR+# an- Collaorati! Comm!rc! "c5

comm!rc!#

(%. aims at ac/uiring and retaining partners ho can enhance the selling and

distribution of a company5s products and services!

'ollaborative commerce 0'commerce1 refers to nonselling#buying electronic

transactions ithin, beteen and among organizations! It implies communications, information

sharing, and collaboration done electronically by means of tools such as groupare and

specially designed collaboration tools!

Some of areas in collaboration that use IOSs are:

%etailerSuppliers

(roduct 2esign

'ollaborative .anufacturing

4.4 +ANAGERIAL ISSUES "for -icuin'#

Intergration of functional information system!

(riority of transaction processing

%ole of IT

Organisational adaptability

The customer is king#/ueen

9oing global

(artner and supplier relationship management


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-thical issues

T+I F

&7&E3I&? &7D DEISI7 SU++3T SGSTE

F.1 anaging 9no8le#ge:1. Intro#uction to 9no8le#ge anagement:

Lnowledge 1anagement !L1$ is a process that helps organizations to identify,

select, organize, disseminate and transfer important information and expertise that

are part of the organizationals memory.

In I/, nowledge is very distinct from data and information. Lnowledge has the

following characteristics:

- %xtraordinary leverage and increasing returns

- ragmentation, leaage and need to refresh, nowledge is dynamic, it isinformation in action

- ncertain value: many intangible aspects

- ncertain value of sharing:

- =ooted in time

T8o tyes of 'no8le#ge:

- Tacit 'no8le#ge: in domain of sub6ective, cognitive and experiential learning.

/acit nowledge is the cumulative store, some examples are corporate


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experiences, metal maps, insights, trade secrets, sill sets, organizational

culture.

- %xplicit nowledge: deals with ob6ective, rational and technical nowledge.

%xample: data, policies, procedure, software, documents, products, strategies

etc.

0rganization needs to integrate the both nowledge, ey reasons for the

integration:- Information must be managed so employees can apply it as nowledge.

- 1uch information is lost because it is not captured. Lien thuc cua K chuyen

gia hYng ghi chep nen hi chuyen gia roi cong it , thong tin tro nen

unavailable.

- 9haring nowledge creates a more powerful company.

- Oaluing intellectual capital signals that the company values its people.

%ncourage employees to learn daily

' functioning nowledge management system follows six stepsi$ reate 'no8le#ge: 0rganizationsals must create a learning environment that

encourages ris taing and accepts the chance of failure.

ii$ ature 'no8le#ge:


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nowledge seekingis the search for and use of internal organizational %nowledge.

*. A++roa!)es to nowledge Management:

< approaches to %nowledge management:

- Pro!ess a++roa!)es: to codify organizational %nowledge via formalized controls, processes and

technologies fre/uently using information technologies to enhance the /uality and speed of %nowledge

creation and distribution.

- Pra!ti!e a++roa!): to %nowledge management assumes that organizational %nowledge is tacitin nature and formal controls, processes and technologies are not suitable for transmitting this type of

understanding.

- T)e &est +ra!ti!e a++roa!)esare the activities and the methods that the most effective

organizational use to operate and manage many functions.

levels of the best practices:

- $ good idea that is not yet proven, but ma%e intuitive sense

- $ good practice, an implemented techni/ue, methodology, procedure that improve business

results- $ local practice

- $n industry best practice based on analyzing hard data

,. 'nsring $!!ess o nowledge Management 'orts#

=rganizationals can gain benefits from implementing a %nowledge management strategy:

- educe loss of intellectual capital due to people leaving the company

- educe costs by decreasing the numbers of times the company must repeatedly solve the same

problem

- educe redundancy of %nowledge-based activities- 0ncrease employees> satisfaction by greater personal development and empowerment

- ?ain a competitive advantage in the mar%etplace

9here are many cases of knowledge management ailre:

- @ac% of management involvement

- @ac% of clear understanding of 8M benefits

- @ac% of ade/uate staff and resources

- =verambitious scope for the 8M effort

- 6mployees often prefer face-to face conversation over technology- =rganizationals implements 8M in an effort to imitate the competition.

9here are few important success factors for 8M

- Management involvement and priorities

- $de/uate technical infrastructure

- Aser education and training

- $de/uate non-technical infrastructure

- $de/uate deployment of8M system


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- aving effective influence in terms of coordination, control and measurement, pro;ect

management and leadership

- aving %ey resources such as financial resources and cross functional e4pertise

- 9a%ing advantage of technological opportunities

/.2 Cor+orate Perorman!e Management And 0siness Intelligen!e#

1. A ramework or 0siness Intelligen!e# Con!e+ts and 0eneits

Business intelligence 1B0) is about leveraging corporate data and transforming it into useful %nowledge inimproving access and refining it to enable appropriate actions.

, maor !om+onents o 0I:

- Data 'arehouse: is a repository of sub;ect-oriented historical data that is organized to be

accessible in a form readily acceptable for analytical processing activities 1data mining, decision support)

- Business $nalytics. 0s the application of models directly to the business data. 5uch as =@$C

1online analytical processing)

- Business Cerformance Management: BCM is a methodology for defining, implementing, and

managing and enterprise>s business strategy by lin%ing ob;ectives with factual measures.- Aser 0nterface: covers all aspects of the communications btw a user and the system.

Maor &eneits o 0I:

- 9ime saving

- 5ingle version of truth

- 0mproved strategies and plans

- 0mproved tactical decisions

- More efficient processes

- 3ost savings- 0mproved customers and partners relationships

Many critical challenges for B0 success:

- 2ailure to recognize B0 pro;ects

- Anengaged or wea% business sponsors

- Anavailable or unwilling business representatives from the functional areas

- @ac% of s%illed staff

- o software release concept

- o wor% brea%down structure- o business analysis or standardization activities

- o appreciation of the negative impact of Edirty dataF on business profitability

- o understanding of necessity for metadata

- 9oo much reliance on disparate methods and tools.

2. 0siness Anal3ti!s4 Online Anal3ti!al +ro!essing4 Re+orting and 5er3ing

Business analytics 1B$) provides the models and procedures to B0, B$ %nown as analytical processing,

business intelligence tools, business intelligence applications or ;ust business intelligence.

*. Data 6isali%ation4 Geogra+)i!al Inormation $3stems and 6irtal Realit3#


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- 9he cost of virtual e4perimentation is much lower than the cost of e4perimentation with a real

system.

- Models allow for simulated compression of time

- Manipulating the model is much easier than manipulating the real system.

- 9he costs of mista%es are much lower in virtual e4perimentation

- Modeling allows a manager to better deal

- Mathematical models allow the analysis and comparison- Model enhance and reinforce learning and support training

2. De!ision $++ort $3stems# or indi"idals4 Gro+s and t)e 'nter+rise

Decision support system 1D55) is a computer-based information system that combines models and data in

an attempt to solve semistructured and some unstructured problems with intensive user involvement.

D55 includes:

- ew and accurate information is needed

- 0nformation was needed fast

- 9rac%ing the company>s numerous business operations was increasingly difficult.- 9he company was operating in an unstable economy

- 3ompany faced increasing foreign and local competition

- 9he 05 department are unable to address the diversity of company>s need

- 9he business analyst function is not inherent within the e4isting systems.

a) Gro+ de!ision s++ort s3stems1?D55s) are an important variant of D55s in which the system is

designed to support a group rather than an individual. 5upporting the wor% team to ma%e decision.

b) Organisational de!ision s++ort $3stem1=D55) that focuses on an organizational tas% or activity

involving a se/uence of operations and decision ma%ers and provide the following:- 0t affects many organizational units or corporate problems

- 0t cuts across organizational functions

- 0t involves computer-based and communications technologies

c) $n e(e!ti"e inormation s3stem1605) %nown as e4ecutive support system 1655) is a technology

designed in response to the specific needs of e4ecutive, Main features:

- apid access

- Direct access to management reports

- Gery user friendly and supported by graphics- Drill down reporting H investigating information in increasing detail

- 6asily connected within online information services and email

- 0nclude analysis support, communications, office automation and intelligence support

*. Intelligent $++ort $3stem and '(+ert $3stem#

Intelligent s3stemis a term that describes the various commercial applications of artificial intelligence

1$0). 9he goal of $0 is to develop computers that can simulate the ability to thin%, hear, see, tal%, wal%

and feel.


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AI a++li!ation#

- Ma%e computers easier to use

- Ma%e %nowledge more widely available

- 0ncrease the speed and consistency of some problem solving

- andle problems

- 0ncrease the productivity of performing many tas%s

- elp in handling information overload'(+ert s3stemtargets to capture the %nowledge of e4perts in all forms and use that %nowledge to solve

comple4 problems of an organization.

,. Ot)er Intelligent $3stems#

Natral langage +ro!essing 7N8P9: 3ommunicating with a computer in 6nglish or whatever

language you may spea%

Natral langage nderstanding:s+ee!) 7"oi!e9 re!ognition

Natral langage generation:"oi!e s3nt)esis: 9echnology that enables computers to produce

ordinary language by EvoiceFArtii!ial Neral networks# are a system of programs and data structures that appro4imates the

operation of the human brain

$re particularly good at recognizing subtle, hidden and newly emerging patterns within comple4 data.

/. Atomated De!ision $++ort#

8nown as enterprise decision management 16DM) systems are rule-based systems that automatically

provide solutions to repetitive managerial problems. 9hrough, 6DM, business can increase customer

profitability, build stronger customer relationships, reduce credit ris% and lower costs of ma%ing

decisions.Benefits of 6DM:

- eed a higher return from previous infrastructure investments

- 2ace increasing business decision comple4ity

- 2ace competitive or regulatory pressure that calls for more sophisticated decisions

- Must ta%e advantage of increasingly short windows of competitive advantage.


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To+i! ;#IMP8'M'NTINGAND MANAGING IT

PART I# $TR


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3ompetitive intelligence.

;.1.1IT $trategi! Alignment

a. Com+etiti"e or!es Model

0t views five ma;or forces of competition that determines the industry>s structural attractiveness.

9hese forces, in combination, determine how the economic value created in an industry is divided among

the players in the industry. 5uch an industry analysis helps companies develop their competitive strategy.

9he five forces are as follows:

9he threat of new entrants.

9he bargaining power of suppliers.

9he bargaining power of customers 1buyers).

9he threat of substitute products or services.

9he rivalry among e4isting firms in the industry.

9he following are some generic strategics proposed for competitive advantage:

3ost leadership strategy.

Differentiation strategy.

iche strategy.

$lliance strategy.

0nnovation strategy.

=perational effctiveness strategy.

3ustomer-orientation strategy.

9ime strategy.

6ntry-barriers strategy.

@oc% in customers or suppliers strategy.

0ncrease switching costs strategy.

&. 6ale C)ain Model

Primar3 a!ti"ities#

0nbound logistics 1inputs)


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=perations 1manufacturing and testing)

=utbound logistics 1storage and distributiona)

Mar%eting and sales

5ervice

$++ort a!ti"ities#

9he firm>s infrastructure 1accounting, finance, management)

uman resources management 1research and development)

Crocurement

!. $trategi! Resor!es and Ca+a&ilities

;.1.2 IT Planning

09 planning is the organised planning of 09 infrastructure and applications portfolios done at

various levels of the organisations.

a. IT Planning A++roa!)es

T)ere are i"e general a++roa!)es to IT +lanning as ollows#

Business-led approach.

Method-driven approach.

9echnological approach.

$dministrative approach.

=rganisational approach.

&. IT Planning Model

9he four-stage 09 planning model is the foundation for the development of a portfolio of

applications that is highly aligned with the corporate goals and has the ability to create an advantage over

competitors. 0t consists of the following four ma;or stages I activities:

$trategi! IT +lanning.

9his stage can also be e4panded to include the process of searching for strategic information

systems 1505) that enable a firm to develop a competitive advantage. 9his involves assessing the current

business environment and the future ob;ectives and strategies:

- 09 alignment with organizational plans

- $ssess current business environment.


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- $lignment

5everal tools and methodologies can be used to facilitate 09 planning. 9hese methods are used:

- 9o help organisations to align their business 09 I 05 strategies with the organisational strategies.

- 9o indentify organisations to utilise 09 for competitive advantage

- 9o analyse internal process.

9he following methodologies have been used for 09 planning:

- 9he business systems planning 1B5C) model.

- 9he stages of 09 growth model:

0nitiation

64pansion

3ontrol

0ntegation

Data administration

Maturity

- 3ritical 5uccess 2actors 1352s) $pproach

- 5cenario planning

0nformation rre/uirements analysis. 0nclude five step:

- 5tep J: Define underlying organizational subsystems.

- 5tep &: Develop a subsystem matri4.

- 5tep


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09 planning becomes more complicated when several organisation are involed, this is particularly

so when dealing with multinational corporations:

Clanning for interorganisarinal systems 10=5)involving several organisations may be comple4.

09 planning for multinational corporations face a comple4 legal, political, and social environment,

which complicates corporate 09 planning.

=ther problems for 09 planning include:

- 3ost and returns-on-investment 1=0) ;ustification

- 9ime-consuming process

- Asing absolete methodologies

- @ac% of /ualified personnel, especially in the planning phase

- Coor communication flow

- Minimal top management support

- 2ailing to translate business goals and strategies into action plans

- 2ailing to ad;ust the 05 plan to reflect ma;or environmental changes

- 0gnoring the 05 plan once it has been developed in the implementation phase.

d. IT Planning = >e&-&ased $3stems

5trategic planning for web-based systems can be viewed as a subset of 09 strategic planning.

owever, in many cases it is done independently of 09 planning. 'le!tri! +lanning 7'-Planning9mostly

deals with the 63 infrastructure, uncovering business opportunities, and deciding on an applications

portfolio that will e4ploit those opportunities.

;.2 IT 'CONOMIC$

;.2.1 T)e Prod!ti"it3 Parado(

9he discrepancy between measures of 09 investment and measures of output is termed as the

productivity parado4. Cossible e4planations of the parado4 include:

Croblems with data or analyses hide productivity gains from 09.

?ains from 09 are by losses in other areas.

09 productivity gains are offset by 09 costs or losses.

;.2.2 '"alating IT In"estment

a. 3ategories of 09 0nvestment

9o evaluate 09 invesments, we need to e4amine the following:


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Galue of information in decision-ma%ing.

9raditional methods for assessing the value of information and 09 investment.

Methods for evaluating and ;ustifying 09 investment.

b. Galue of 0nformation

Galue of 0nformation K et benefits with information H net benefits without informationc. 9raditional Methods for $ssessing the Galue of 0nformation and 09 0nvestment

$utomation of business processes is an area where it is necssary to define and measure 09

benefits and costs. 3apital investment decisions can also be analyzed by !ost-&eneit anal3ses, which

compare the total value of the benefits with the associated costs. 9raditional tools used to evaluate capital

investment decisions are Net Present 6ale 7NP69 and Retrn On In"estment 7ROI9.

T)e as+e!t o intangi&le &eneits#

3osting 09 0nvestment

Croblem of 0ntangible Benefits

9o handle intangible benefits, suggested the following solutions:

- 9hin% broadly and softly

- Cay your freight first

- 2ollow the unanticipated.

d. Met)ods or '"alating and ?sti3ing IT In"estment

$ppraisal methods for 09 investments are categorized into the following four types:

2inancial 1CG L =0)

Multicriteria 1information economics and value analysis)

atio 109 e4penditures vs total turnover)

Cortolio

$ specific approach for 09 cost evaluation is the 9otal 3ost of =wnership 193=). 93= is aformula for calculating the cost of owning, operating, and controlling an 09 system. 9he cost incudes:

$c/uisition cost 1hardware and software)

$perations cost 1maintenance, training, operations, etc)

3ontrol cost 1standardisation, security, central services, etc)


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Methods for 6valuating 09 0nvestments include:

Galue analysis

0nformation economics

5coring methodology

Benchmar%s

Management by ma4im

eal-options valuation

Balanced scorecard

Cerformance dashboard

$ctivity-based costing

;.2.* IT '!onomi!s $trategies

a. C)arge&a!k

9hese systems may be used to regulate the use of shared information systems. 9here are two

alternatives to this strategy:

$ll e4penses go into an overhead account. 'ith this approach, 09 is EfreeF and has no e4plicit cost, so

there are no incentives to control usage or avoid waste.

3ost recovery is an approach where all 09 costs and usage levels.

&. Otsor!ing

9his is a strategy for obtaining the economic benefits of 09 and controlling its costs by obtaining

09 services from outside vendors rather than from internal information system 105) units within the

organization. =utsourcing may reduce 09 costs and can ma%e it possible for organizations to concentrate

their management efforts on issues related to their core competencies.

9he various forms of outsourcing include:

=ffshore outsourcing of software development

$pplication 5ervice Croviders 1$5Cs) and utility computing $5Cs that manage and distribute

software-based services and solutions from a central, off-site data center, via the 0nternet

Management 5ervice Croviders 1M5Cs) who are vendors that remotely manage and monitor

enterprise applications.

Potential Otsor!ing 0eneits#

- Financial:


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$voidance of havy capital investment, thereby releasing funds for other users.

0mproved cash flow and cost accountability.

0mproved cost benefits from economies of scale and from sharing computer housing, hardware,

software, and personnel.

@ess need for e4pensive office space.

educe and control operating costs.

- Technical:

$ccess to new information technologies.

?reater freedom to choose software due to a wider range of hardware.

$bility to achieve technological improvements more easily.

?reater access to technical s%ills not available internally.

2aster application development and placement of 09 applications into service.

- Management:

3oncentration on developing and running core business activity, improved company focus.

Delegation of 09 development 1design, production, and ac/uisition) and operational responsibilityto suppliers.

6limination of need to recruit and retain competent 09 staff.

educed ris% of bad software.

- Human Resources:

=pportunity to draw on specialist s%ills, available from a pool of e4pertise, when needed.

6nriched career development and opportunities for remaining staff.

- Quality:

3learly definedservice levels

0mproved performance accountability

0mproved /uality accreditation


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- Flexibility:

uic% response to business demands 1agility)

$bility to handle 09 pea%s and valleys more effectively 1fle4ibility).

;.2., Ot)er As+e!ts o IT '!onomi!s

a. 6conomics of 'eb-based 5ystems and 63

b. 09 2ailures and unaway Cro;ects

;.* IT APP8ICATION AC5


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a. Otsor!ing

- Otsor!ingis defined as ac/uiring 09 services from an e4ternal 1outside) organisation rather than

through internal information systems units

- Os)ore otsor!ingis the practice of migrating business processes overseas to lower cost without

significantly neglecting /uality. 0t is increasingly a proper option for 09 systems ac/uisition.

&. A++li!ation $er"i!e Pro"ider 7A$P9$n $5C is an agent or vendor who assembles the software needed by enterprises and pac%ages

them usually with outsourced development, operations, maintenance, and other services.

!.


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processes that are managed via 'eb services and 5=$ adapt faster to changing customer needs and

business climates.

;.*./ 0siness Pro!ess Redesign

9he introduction of new technology may re/uire restructure or redesign of business processes.

also, processes may need to be redesigned to fit standard software.

Drivers of Business Crocess edesign

$ business process is a collection of activities that converts inputs into outputs. 9he following are

some drivers of business process redesign:

- 2itting commercial software

- 5treamlining the supply chain

- Carticipating in private or public e-mar%etplaces

- 0mproving customer service and implementing 3M

- 3onducting e-procurement

- 6nabling direct online mar%eting

- educing cost and improving productivity

- estructuring or eliminating old processes prior to automation

- 9ransformation to e-business

- eed for information integration

- eed for customization

Methodologies for edesigning Crocesses

- 0siness Pro!ess Reengineering 70PR9, a methodology in which an organization fundamentally

and radically redesigned its business processes to archieve dramatic improvement. 9oday, BC

can focus on anything from the redesign of an individual process, to redesign of a group of

processes, to redesign of the entire enterprise.

- $ new method for restructuring %nown as 0siness Pro!ess Management 70PM9combines

wor%flow systems and redesign methods. 9his emerging methodology covers three process

categories: people-to-people, systems-to-systems, and system-to-people integrations. 0t is a

blending of wor%flow, process management, and applications integration.

ole of 09 in Business Crocesses edesign


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9he role of 09 in redesigning business processes can be very critial. 09 can help in analyzing,

combining, improving, and simplifying business processes. redesign of business processes often means

need to change some or all of the organisational information systems. 9his process is referred to as

retooling.

N. 659$B@050? $D M$$?0? 09 563A09O

N..J 9he 05 Department and the 30=

N..& 05 Gulnerability and 9hreatsN..< Crotecting 0nformation esources

N.. Business 3ontinuity and Disaster ecovery Clanning

N..* 0mplementing 5ecurity: $uditing and is% Management

N.* M$$?60$@ 055A65

PART II# $s strategic ob;ectives and competitive

advantage: create innovative applications, utilise as competitive weapons, reengineering business

processes, establishing lin%s with business partners, reducing costs, building relationships withsuppliers and customers, create new products, providing competitive intelligence.

$lignment 09 with the organisation has two aspects: 05 alignment is aligning the 05 function>s

strategy, structure, technology, and processes with those of the business units and 05 strategic

alignment involves aligning 05 strategy with organisational strategy.

9o help 30=s and other 09 specialists develop an understanding of the industry and organisation in

which they operate, several framewor%s such as the competitive forces model, the value chain model,

and the resource-based view of the firm model can be used.

09 planning is the organised planning of 09 infrastructure and applications portfolios done at various

levels of the organisations.

9he four-stage 09 planning model is the foundation for the development of a portfolio of applications

that is highly aligned with the corporate goals and has the ability to create an advantage over

competitors. 0ts stages include strategic 09 planning, information re/uirements analysis, resource

allacation, and pro;ect planning.

09 planning becomes more complicated when several organisations are involved through

interorganisational systems and when dealing with multinational corporations.

$lthough organisations have spent tremendous amounts of money on 09, it is also difficult to prove

that the spending has increased national or industry productivity. 9he discrepany between measures

of 09 investment and measures of output is termed as the productivity parado4.


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9here are several traditional methods for assessing information value and 09 ;ustification such as

cost-benefit analyses, CG, and =0. 5pecial methodologies are used to assess some of the newest 09

technologies such as value analysis, information economics, and balanced scorecards.

6valuating 09 investment re/uires finding the total costs of ownership and the total benefits of

ownership and subtracting the costs from the benefits. 9he value of information to an organisation

should be part of that calculation.

3hargebac% systems may be used to regulate the use of shared information systems. =utsourcing may

reduce 09 costs can ma%e it possible fororganisations to concentrate their management efforts on

issues related to their core competencies.

'eb-based technologies may be approached differently for conducting cost-benefit analysis due to

their different economic curves, lac% of baseline data, fre/uent changes, etc.

09 application ac/uisition includes all approaches to obtaining systems, that is buying, leasing, or

building. 9he ob;ective of 09 application ac/uisition is to create, buy, or rent applications and

implement them.

9he process of ac/uiring 09 applications can be divided into five steps: planning and ;ustificationP 09

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