57
1 McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved. Chapter 6 Enterprise e-Business Systems
1
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Chapter
6
Enterprise e-Business Systems
2
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Learning Objectives
Identify and give examples to illustrate the
following aspects of customer relationship
management, enterprise resource
management, and supply chain management
systems:
Business processes supported
Customer and business value provided
Potential challenges and trends
3
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Section I
Customer Relationship Management:
The Business Focus
4
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management
Provides customer-facing employees with a
single, complete view of every customer at
every touch point and across all channels
Provides the customer with a single, complete
view of the company and its extended channels
5
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
CRM..
Integrates and automates many of the
customer serving processes
Creates an IT framework of Web-enabled
software & databases that integrates these
processes with the rest of the company’s
business operations
6
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Includes software modules that provide tools
that enable a business & its employees to
provide fast, convenient, dependable,
consistent service.
7
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Major Application Components
Contact & Account Management
Helps capture and track relevant data
about past and planned contacts with
prospects & customers.
8
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Sales
Provides sales reps with software tools &
company data needed to support &
manage their sales activities.
Helps optimize cross-selling & up-selling
9
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Marketing & Fulfillment
Helps accomplish direct marketing
campaigns by automating tasks
Helps capture & manage prospect &
customer response data
Helps in fulfillment by quickly scheduling
sales contacts & providing appropriate
information on products & services to
them
10
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Customer Service and Support
Provides software tools & real-time access
to the common customer database
Helps create, assign, & manage requests
for service from customers
Call center software
Help desk software
11
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Retention and Loyalty Programs
Helps the company identify, reward, and
market to their most loyal and profitable
customers
12
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
13
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Three Phases of CRM
Acquire (new customers)
By doing a superior job of contact
management, sales prospecting, selling,
direct marketing, & fulfillment.
14
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Enhance (customer satisfaction)
By supporting superior service from a
responsive networked team of sales and
service specialists.
15
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Retain (your customers)
Help identify and reward your most loyal,
profitable customers.
16
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Benefits and Challenges
Allows a business to identify its best
customers
Makes possible real-time customization &
personalization of products & services based
on customer wants, needs, buying habits, &
life cycles
17
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Benefits and Challenges (continued)
Enables a company to provide a consistent
customer service experience
Failures
Due to lack of understanding & preparation.
CRM is not a silver bullet
18
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Customer Relationship Management (continued)
Trends
Operational CRM
Analytical CRM
Collaborative CRM
Portal-based CRM
19
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Section II
Enterprise Resource Planning:
The Business Backbone
20
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning
Serves as a cross-functional enterprise
backbone that integrates & automates many
internal business processes and information
systems
Helps companies gain the efficiency, agility, &
responsiveness needed to succeed today
21
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning (continued)
Gives a company an integrated real-time view
of its core business processes
ERP software suites typically consist of
integrated modules of…
Manufacturing
Distribution
Sales
Accounting
Human Resource Management
22
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning (continued)
Benefits and Challenges
Quality and efficiency
Helps improve the quality and efficiency of
customer service, production, &
distribution by creating a framework for
integrating and improving internal
business processes
23
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning (continued)
Decreased Costs
Reductions in transaction processing costs
and hardware, software, and IT support
staff
24
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning (continued)
Decision support
Provides cross-functional information on
business performance to assist managers in
making better decisions
25
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning (continued)
Enterprise agility
Results in more flexible organizational
structures, managerial responsibilities, and
work roles
26
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning (continued)
Costs of ERP
The costs and risks of failure in
implementing a new ERP system are
substantial.
27
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning (continued)
28
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning (continued)
Causes of ERP failures
Underestimating the complexity of the
planning, development, and training
required
Failure to involve affected employees in the
planning & development phases and change
management programs
29
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning (continued)
Trying to do too much, too fast
Insufficient training
Believing everything the software vendors
and/or consultants say
30
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Enterprise Resource Planning (continued)
Trends
Flexible ERP
Web-enabled ERP
Interenterprise ERP
E-Business Suites
31
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Section III
Supply Chain Management:
The Business Network
32
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Supply Chain Management
A cross-functional interenterprise system that
uses IT to help support & manage the links
between some of a company’s key business
processes and those of its suppliers, customers,
& business partners.
Goal is to create a fast, efficient, & low-cost
network of business relationships.
33
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Supply Chain Management (continued)
34
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Supply Chain Management (continued)
Electronic data interchange
Exchanging business transaction
documents over the Internet & other
networks between supply chain trading
partners
35
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Supply Chain Management (continued)
The Role of SCM
36
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Supply Chain Management (continued)
Benefits and Challenges
Can provide faster, more accurate order
processing, reductions in inventory levels,
quicker time to market, lower transaction
and materials costs, & strategic relationships
with suppliers
37
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Supply Chain Management (continued)
Problem causes
Lack of proper demand planning
knowledge, tools, and guidelines
Inaccurate or overoptimistic demand
forecasts
Inaccurate production, inventory, and other
business data
Lack of adequate collaboration
38
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Supply Chain Management (continued)
Trends
39
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Discussion Questions
Should a company become a customer-focused
business?
Why would systems that enhance a company’s
relationships with customers have such a high
rate of failure?
40
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Discussion Questions (continued)
How could some of the spectacular failures of
ERP systems have been avoided?
Should companies continue to use EDI
systems?
41
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Discussion Questions (continued)
How can the problem of overenthusiastic
demand forecasts in supply chain planning be
avoided?
What challenges do you see for a company
that wants to implement collaborative SCM
systems?
42
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Discussion Questions (continued)
Should companies install e-business software
suites or “best of breed” e-business software
components?
43
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 1 – Mitsubishi Motor Sales
What are the key application components of
Mitsubishi’s CRM system?
What is the business use of each of those
components?
44
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 1 (continued)
What are the benefits to a business and its
customers of a CRM system like Mitsubishi’s?
Do you approve of Mitsubishi’s approach to
acquiring and installing its CRM system?
45
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 1 (continued)
Why have many CRM systems failed to
provide promised benefits like those generated
by Mitsubishi’s system?
46
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 2 – Agilent Technologies & Russ Berrie
What are the main reasons companies
experience failures in implementing ERP
systems?
What are several key things companies should
do to avoid ERP systems failures?
47
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 2 (continued)
Why do you think ERP systems in particular
are often cited as examples of failures in IT
systems development, implementation, or
management?
48
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 2 (continued)
What do you think caused the major failure of
Agilent’s ERP implementation?
Why do you think they did not act to avoid the
reasons you specified?
49
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 3 – TaylorMade Golf & HON Industries
How could moving business information
systems with suppliers and distributors to the
Web result in such dramatic business benefits
as experienced by TaylorMade Golf?
How does HON Industries’ new SCM system
improve the efficiency of their supply chain?
50
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 3 (continued)
What other SCM initiatives would you
recommend that TaylorMade or HON
Industries implement to improve their supply
chain performance and business value?
51
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 3 (continued)
What are several ways a small business could
use supply chain management to improve the
efficiency and business value of their supply
chain?
52
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 4 – H-P, Eastman Chemical, & Others
Why can both large and small businesses cut
costs and increase revenues by moving their
supply chains online?
53
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 4 (continued)
What is the business value to Eastman
Chemical and W.W. Grainger of their
initiatives to help their suppliers and
customers do business online?
54
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 4 (continued)
Why are many small suppliers reluctant to do
business online with their large customers?
What can be done to encourage small
suppliers to get online?
55
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 5 – Wal-Mart & Mattel
Do you agree that Wal-Mart is “the best
supply chain operator of all time”?
Why or why not?
56
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 5 (continued)
What has Mattel learned from Wal-Mart?
How well are they applying it to their own
business?
57
McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
Real World Case 5 (continued)
What can other businesses learn from the
experiences of Wal-Mart and Mattel that
could improve their supply chain
performance?
