1.

How do enterprise systems help businesses achieve operational excellence? Define an enterprise system and explain how enterprise software works. Enterprise software consists of a set of interdependent software modules that support basic internal business processes. The software allows data to be used by multiple functions and business processes for precise organizational coordination and control. Organizations implementing this software would have to first select the functions of the system they wish to use and then map their business processes to the predefined business processes in the software. A particular firm would use configuration tables provided by the software to tailor a particular aspect of the system to the way it does business. Table 9.1 describes some of the major business processes supported by enterprise software. These include financial and accounting processes human resources processes manufacturing and production processes and sales and mar!eting processes. Describe how enterprise systems provide value for a business. Enterprise systems provide value both by increasing operational efficiency and by providing firmwide information to help managers ma!e better decisions. "arge companies with many operating units in different locations have used enterprise systems to enforce standard practices and data so that everyone does buisness the same way. Enterprise systems helps firms respond rapidly to customer re#uests for information or products. $anufacturing is better informed about producing only what customers have ordered procuring e%actly the right amount of components or raw materials to fill actual orders staging production and minimizing the time that components or finished products are in inventory. Enterprise software includes analytical tools for using data captured by the system to evaluate overall organizational performance. Enterprise system data have common standardized definitions and formats that are accepted by the entire organization. Enterprise systems allow senior management to easily find out at any moment how a particular organizational unit is performing or to determine which products are most or least profitable. &ompanies can use enterprise systems to support organizational structures that were not previously possible or to create a more disciplined organizational culture. They can also improve management reporting and decision ma!ing. 'urthermore enterprise systems promise to provide firms with a single unified and all(encompassing information system technology platform and environment. "astly enterprise systems can help create the foundation for a customer(driven organization

2.

How do supply chain management systems coordinate planning, production, and logistics with suppliers? Define a supply chain and identify each of its components. A supply chain is defined as a networ! of organizations and business processes for procuring materials transforming raw materials into intermediate and finished products and distributing the finished products to customers. )t lin!s suppliers manufacturing plants distribution centers retail outlets and customers to supply goods and services
1

from source through consumption. *upply chain management is the integration of supplier distributor and customer logistics re#uirements into one cohesive process. xplain how supply chain management systems help reduce the bullwhip effect and how they provide value for a business. The bullwhip effect occurs when information about the demand for a product gets distorted as it passes from one entity to the ne%t across the supply chain. )t can also result from +gaming , as purchasers present manufacturers or suppliers with a false picture of consumer demand. )t can be dealt with by reducing uncertainties about demand and supply when all of the supply chains have accurate and up(to(date information. Define and compare supply chain planning systems and supply chain execution systems. *upply chain planning systems enable the firm to generate demand forecasts for a product and to develop sourcing and manufacturing plans for that product. They help companies ma!e better operating decisions such as determining how much of a specific product to manufacture in a given time period- establishing inventory levels for raw materials intermediate products and finished goods- determining where to store finished goods- and identifying the transportation mode to use for product delivery. One of the most important functions is demand planning which determines how much product a business needs to ma!e to satisfy all of its customers. demands. These functions are referred to as order planning advanced scheduling demand planning distribution planning and transportation planning. *upply chain e%ecution systems manage the flow of products through distribution centers and warehouses to ensure that products are delivered to the right locations in the most efficient manner. They trac! the physical status of goods the management of materials warehouse and transportation operations and financial information involving all parties. These functions are referred to as order commitments final production replenishment distribution management and reverse distribution. Describe the challenges of global supply chains and how !nternet technology can help companies manage them better. 'irms use intranets to improve coordination among their internal supply chain processes and they can use e%tranets to coordinate supply chain processes shared with their business partners. /sing intranets and e%tranets all members of the supply chain can instantly communicate with each other using up(to(date information to adjust purchasing logistics manufacturing pac!aging and schedules. A manager can use a 0eb interface to tap into suppliers. systems to determine whether inventory and production capabilities match demand for the firm.s products. 1usiness partners can use 0eb(based supply chain management tools to collaborate online with suppliers and customers. *ales representatives can access suppliers. production schedules and logistics information to monitor customers. order status. The )nternet has introduced new ways of managing warehousing shipping and pac!aging based on access to supply chain information that can give companies an edge in delivering goods and services at a reasonable cost.

Distinguish between a push"based and pull"based model of supply chain management and explain how contemporary supply chain management systems facilitate a pull"based model. )n a push(based model production master schedules are based on forecasts or best guesses of demand for products and products are +pushed, to customers. )n a pull(based model actual customer orders or purchases trigger events in the supply chain. )n contemporary supply chain management systems the )nternet and )nternet technology ma!e it possible to move from se#uential supply chains where information and materials flow se#uentially from company to company to concurrent supply chains where information flows in many directions simultaneously among members of a supply chain networ!. $embers of the networ! immediately adjust to changes in schedules or orders. #.How do customer relationship management systems help firms achieve customer intimacy? Define customer relationship management and explain why customer relationships are so important today. &ustomer relationship management2 a business and technology discipline that uses information systems to coordinate all of the business processes surrounding the firm.s interaction with its customers in sales mar!eting and service. )mportance of customer relationships2 3lobalization of business the )nternet and electronic commerce have put more power in the hands of customers. &ompanies are realizing that their only enduring competitive strength may be their relationships with their customers. *ome say that the basis of competition has switched from who sells the most products and services to who +owns, the customer and that customer relationships represent the firm.s most valuable asset. Describe how partner relationship management $%&'( and employee relationship management $ &'( are related to customer relationship management $)&'(? &4$ systems capture and integrate customer data from all over the organization consolidate the data analyze the data and then distribute the results to various systems and customer touch points across the enterprise. &ompanies can use this customer !nowledge when they interact with customers to provide them with better service or to sell new products and services. &4$ systems integrate and automate many customer( facing processes in sales mar!eting and customer service providing an enterprise(wide view of customers. These systems trac! all of the ways in which a company interacts with its customers and analyze these interactions to ma%imize customer lifetime value for the firm. &4$ e%tends to a firm.s business partners who are responsible for selling to customers. The more comprehensive &4$ pac!ages contain modules for partner relationship management 564$7 and employee relationship management 5E4$7. 64$ uses many of the same data tools and systems as &4$ to enhance collaboration between a company and its selling partners. )f a company does not sell directly to
3

customers but rather wor!s through distributors or retailers 64$ helps these channels sell to customers directly. E4$ software deals with employee issues that are closely related to &4$ such as setting objectives employee performance management performance(based compensation and employee training. Describe the tools and capabilities of customer relationship management software for sales, marketing, and customer service. &ustomer relationship management systems typically provide software and online tools for sales customer service and mar!eting. 4efer to 'igure 9(9 for a diagram of the business processes that &4$ software supports for sales mar!eting and service. &apabilities include the following2 *ales2 *ales force automation modules in &4$ systems help sales staff increase their productivity by focusing sales efforts on the most profitable customers those who are good candidates for sales and services. 6rovide sales prospect and contact information product information product configuration capabilities and sales #uote generation capabilities. Enable sales mar!eting and delivery departments to easily share customer and prospect information. )ncrease salespeople.s efficiency in reducing the cost per sale as well as the cost of ac#uiring new customers and retaining old ones. &apabilities for sales forecasting territory management and team selling. *upports direct(mar!eting campaigns by providing capabilities for capturing prospect and customer data for providing product and service information for #ualifying leads for targeted mar!eting and for scheduling and trac!ing direct(mar!eting mailings or e(mail. &ustomer *ervice2 6rovide information and tools to ma!e call centers help des!s and customer support staff more efficient. )ncludes capabilities for assigning and managing customer service re#uests. $ay also include 0eb(based self(service capabilities. $ar!eting2 *upport direct(mar!eting campaigns by providing capabilities for capturing prospects and customer data for providing product and service information for #ualifying leads for targeted mar!eting and for scheduling and trac!ing direct(mar!eting mailings or e(mail. )ncludes tools for analyzing mar!eting and customer data. )dentifies profitable and unprofitable customers designs products and services to satisfy specific customer needs and interests and identifies opportunities for cross(selling up(selling and bundling. Distinguish between operational and analytical )&'. Operational &4$ includes customer(facing applications such as tools for sales force automation call center and customer service support and mar!eting automation.
4

Analytical &4$ includes applications that analyze customer data generated by operational &4$ applications to provide information for improving business performance management. Applications are based on data warehouses that consolidate data from operational &4$ systems and customer touch points. The database serves online analytical processing data mining and other data analysis techni#ues. 6rovides information related to customer lifetime values. *. +hat are the challenges posed by enterprise applications? ,ist and describe the challenges posed by enterprise applications. Enterprise applications are very difficult to implement successfully. They re#uire e%tensive organizational change e%pensive new software investments and careful assessment of how these systems will enhance organizational performance. Enterprise applications re#uire both deep(seated technological changes and fundamental changes in business operations. Employees must accept new job functions and responsibilities. They must learn new wor! activities and understand how data they enter into the system can affect other parts of the company. Enterprise applications introduce switching costs that ma!e it very e%pensive to switch vendors. $ultiple organizations will share information and business processes. $anagement vision and foresight are re#uired to ta!e a firm( and industry(wide view of problems and to find solutions that realize strategic value from the investment. xplain how these challenges can be addressed. Enterprise applications create new interconnections among myriad business processes and data flows inside the firm 5and in the case of supply chain management systems between the firm and its e%ternal supply chain partners7. Employees re#uire training to prepare for new procedures and roles. Attention to data management is essential. $anagement must understand the impact that implementing enterprise applications will have on every facet of the business. E%ecutives must not underestimate the time and costs of implementation not just on the organization but also on customers suppliers and business partners. -.How are enterprise applications used in platforms for new cross"functional services? Define a service platform and describe the tools for integrating data from enterprise applications. *ervice platforms integrate multiple applications from business functions units or partners to deliver a seamless e%perience for customers employee managers or business partners. They provide complete information to everyone involved in a process from beginning to end. The service platforms can be further integrated into an enterprise(wide composite process. The applications can be integrated with older legacy applications and systems from other vendors through the use of middleware 8$" and 0eb services tools. 6ortals provide framewor!s for building new composite services and presenting them to users as though the information is coming from a single source.