e-Business Systems

CHAPTER 7

Lecture-9/ T. Nouf Almujally

1

Outline

Section 1 (Enterprise Business Systems):• Cross-Functional Enterprise Applications• Getting All the Geese Lined Up: Managing at the Enterprise

Level• Customer Relationship Management: The Business Focus.• What is CRM?• The Three Phases of CRM• Benefits and Challenges of CRM (not required)

• CRM Failures (not required)• Enterprise Recourse Planning: The Business Backbone• What is ERP?• Benefits and Challenges of ERP

• Causes of ERP Failures (not required)

Outline

Section 1 (Enterprise Business Systems):• Supply Chain Management: The Business Network.• What is CRM?

• Electronic Data Interchange (not required)• The Role of SCM (not required)

• Benefits and Challenges of SCM (not required)• Enterprise Application Integration• Transaction Processing Systems.• Enterprise Collaboration Systems

Section 2:• Functional Business Systems summarized in Figure 7.24

(required only)

Learning Objectives

• Identify these cross-functional enterprise systems, and give examples of how they can provide business value to a company• Enterprise Resource planning• Customer Relationship Management• Supply chain management• Enterprise application integration• Transaction processing systems• Enterprise collaboration systems

Enterprise Business Systems

E-businessUsing the Internet, other networks, and IT to

support…

Electronic commerce

Enterprise communicationsand collaboration

Web-enabled business processes

E-commerce Buying, selling, and marketing of products, services, and information over the Internet and other networks

Both within a networked enterprise and with its customers and business partners.

Cross-Functional Enterprise Applications

• Business firms are using Internet technologies to help them reengineer and integrate the flow of information among their internal business processes and their customers and suppliers.

• Companies all across the globe are using the WWW and their intranets and extranets as a technology platforms for their cross-functional and interenterprise information systems.

Cross-Functional Enterprise Applications

• Companies today are using IT to develop integrated cross-functional enterprise systems that cross the boundaries of traditional business functions to reengineer and improve business processes all across the enterprise.• To share information resources and improve

the efficiency and effectiveness of business processes.

• To develop strategic relationships with customers, suppliers, and business partners.

Enterprise Application Architecture

Major e-business cross-functional enterprise applications and their interrelationships are summarized in this architecture:

Internal production, distribution, ……. financial processes.

Acquiring and retaining profitable customers via marketing, sales, …..services.

Developing sourcing and procurement processes

Enterprise Application Architecture

• These applications include integrated cross-functional enterprise systems such as:

• Enterprise resource planning (ERP).• Customer relationship management (CRM)• Supply chain management (SCM).

• Focuses on accomplishing fundamental business processes in concert with:• Customers• Suppliers• Partners• Employees

Managing at the Enterprise Level

• Getting the whole business to fly in the same direction, as efficiently as possible:• Customer relationships• Back-office operations• Movement of raw materials & finished goods

Customer Relationship Management - CRM

The Business Focus

Customer Relationship Management

• A customer-centric focus• Customer relationships are a company’s most

valued asset.• Every company should find and retain the

most profitable customers possible.

What is CRM?

Managing the full range of the customer relationship involves two related objectives:

Managing the full range of the customer relationship involves two related objectives:

(2 )Providing the customer with a single, complete view of the company and

its extended channels

(1 )Providing customer-facing employees with a single, complete view of every customer,at every touch point, across all channels

What is CRM?

Customer relationship management: is a cross-functional enterprise system that:

• integrates and automates many of the customer-serving processes in sales, marketing, and customer services that interact with a company's customers.

• Create an IT framework of Web-enabled software and databases that integrates these processes with the rest of a company’s business operations.

• Siebel Systems, Oracle, SAP AG, IBM are some of the leading vendors of CRM software.

Application Components of a CRM System

• CRM systems include a family of software modules that provides the tools that enable a business and its employees to provide fast, dependable, and consistent service to its customers.

1- Contact and Account Management

• CRM SW helps sales, marketing, and service professionals capture and track relevant data about:

• Every past and planned contact with customers.• Other customer business & life-cycle events.

• Data are captured through:• Telephone, fax, e-mail, Websites, Retail stores, personal

contact.

• CRM SW store the data in a common customer DB that integrates all customers account information and makes it available throughout the company via the Internet, intranet for sales, marketing, services and other CRM applications.

2- Sales

• A CRM system provides sales representatives with the SW tools and data resources they need to:• Support and manage sales activities.• Optimize cross- and up-selling.

• CRM also provides access enabling sales representatives to check on a customer’s account status and history before scheduling their sales calls.

3- Marketing and Fulfillment

CRM systems help marketing professionals accomplishmarketing campaigns by automating tasks

Qualifying leads for targeted marketing

Scheduling and tracking marketing mailings

Capturing and managing responses

Analyzing the business value of a campaign

Fulfilling responses & requests by quickly scheduling sales contracts & provide info about products

4- Customer Service and Support

• CRM system provide service representatives with SW tools and access to the customer DB shared by sales and marketing professionals.

• CRM helps customer service managers create, assign and manage customers’ requests for service.

• Call center software.

• Help desk software.

• Web-based self-service.

5- Retention and Loyalty Programs

Increasing customer

retention by 5% can increase

company profits 85%

It costs 6 times more to sell to

a new customer than

to sell to an existing one

An unhappy customer will

tell 8-10 others about his

experience

70% of complaining customers will do business with the

company again if it quickly fixes a

problem

5- Retention and Loyalty Programs

• Enhancing and optimizing customer retention and loyalty is a major business strategy and primary objective of CRM.

• CRM system help a company to Identify, reward, and market to their most loyal and profitable customers.

5- Retention and Loyalty Programs

CRM analytical software includes data mining tools

and other analytical marketing software.

CRM databases may consist of a

customer data warehouse and

data marts.

+ =

Used to identify profitable and

loyal customers

direct marketing programs

toward them

Three Phases of CRM

• All CRM application components aimed at helping a company acquire, enhance, and retain profitable relationships with its customers as a primary business goal.

Enterprise Resource Planning - ERP

The Business Backbone

What is ERP?

Enterprise resource planning:• is a cross-functional enterprise system that

integrates and automates many of the internal business processes and information systems of a company, particularly those within the manufacturing, logistics, distribution, accounting, finance, and human resource functions of the business.

• Now, ERP serves as the vital backbone information system of the enterprise, helping a company achieve the efficiency, agility, and responsiveness required to succeed in a dynamic business environment.

What is ERP?

Facilitates business,supplier, and customer

information flows

Facilitates business,supplier, and customer

information flows

Supports basicinternal business

processes

Supports basicinternal business

processes

An integratedsuite of software

modules

An integratedsuite of software

modules

The backbone ofbusiness processesThe backbone of

business processes

A cross-functionalenterprise systemA cross-functionalenterprise system

ERP Application Components

• ERP software consists of integrated modules that give a company a real-time view of its core business processes, such as production, order processing, inventory management and sales tied together by the ERP application software and a common DB.

ERP Application Components

ERP Application Components

• ERP system ..• track business resources (such as cash,

raw materials, production capacity) • and track the status of commitments

made by the business (e.g. customer orders ,purchase orders, employee payroll)

• no matter which department (e.g. manufacturing, purchasing, sales, accounting) has entered the data into the system.

Benefits and Challenges of ERP

ERP Business Benefits

1. Quality & efficiency2. Decreased costs3. Decision support4. Enterprise agility

ERP Costs

1. High risk & cost2. Hardware and

software are a small part of overall project

3. Failure can cripple or kill a business

Costs of Implementing a New ERP

Read from Chapter 7 (Section 1)