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Enterprise Processes and Systems

Enterprise Systems (ES) are integrated information systems that automate business processes across multiple departments or an entire organization. This article explores the concept, design, and benefits of ES, with a focus on customer relations management and decision support capabilities.

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Enterprise Processes and Systems

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  1. Class 17 Enterprise Processes and Systems MIS 2000 Instructor: Bob Travica Updated 2017

  2. Outline • Concept of Enterprise System (ES) / Enterprise Resource Planning System • ES Design • Databases for ES • Purposes of ES • Example of ES in Customer Relations Managaemnt • DSS capability of ES • ERP System Benefits and Costs • Summary

  3. Enterprise System • Enterprise System (ES, ERPS)* is an integrated information system that carries business processes for several departments or in an entire organization. • All data are in electronic form. • Very high level automation. Organization Supply Process Production Process Marketing Process Sales & Delivery Process Human Resources Process Accounting & Finance Process Electronic Links to buyers Electronic Links to suppliers IS Development & Maintenance Process Management Process (operational, strategic) Enterprise System 3

  4. Departments covered by ES: purchasing, inventory, production planning and scheduling, accounting, finance, HR, sales… almost any.* • ES typically performs functions of TPS and MIS. With additional modules, ES works as data-driven DSS. • ES are developed differently than other IS. Software is sold in packages, then configured to meet a company’s needs. ** Purchasing Department Production Dept. Marketing Dept. Sales & Delivery Departments HR Dept. Accounting Dept. Info. Systems Dept. Enterprise System (TPS,MIS | DSS) Management Process

  5. Enterprise System Design User interfaces in organizational departments • The ES core is the module called ES Engine and Broker. Business processes are mapped in there. • Centralized DBs used by ES supply data to business processes defined by ERP modules (accounting, finance, HR...) • ES can be one brand (e.g., SAP) and use databases another (e.g., Oracle) ES Engine & Broker Corporate centralized databases

  6. Databases for Enterprise System Benefit from centralized databases is that an entity is defined just once and so used across company departments. This improves data quality (next slide). - Oracle - MS SQL - SAP MaxDB Databases that support ES may have tens of thousands of tables. High complexity.

  7. Purposes of Enterprise System Department-specific and Corporate-wide reporting Human Resources Accounting & Finance • Purposes of ES (ERPS): • The main purpose is to provide an integrated view of a company’s operations. This is possible owing to centralization in corporate data management. Primary beneficiary is executive managers. • 2. The integrated view allows for more informed decision making because data are more consistent, complete, accurate, timely.

  8. Customer Relations Management- Sales & Marketing Processes Attributes Entity (italics) Customer: Customer ID, Customer Type*, Name, Address, City*, Postal Code, Phone, Email Market management entities: Segment, Promotion, Campaign, Channel Marketing Product: Product ID, Product Type*, Description, Distribution Channel, List Price Customer Order: Customer Order Number, Order Date, Quantity Customer Order Management Sales Record: Sale Number, Sale Date, Salesperson*, Price Sales Billing Record: CustomerBillingID, Date, Amount, Payment Method Billing Customer Support: Customer ID, Complaint, Customer, Date Complaints/ Support Customer: Customer ID, Date, Comment, Contribution Community of Interest

  9. System Support to Customer Relations – Department Systems vs. ES Approach • Old IS solution – separate system for each process • New IS solution – a single system – Enterprise System* ES Mkt campaign TPS Mkt segmentation DSS Brand mgt MIS/DSS Marketing Marketing Customer Master TPS Sales TPS/MIS Sales Sales Customer Order Mgt TPS/MIS Customer Order Management Customer Order Management Billing TPS/MIS Billing Billing Support Desk TPS/MIS Complaints/ Support Complaints/ Support Communication sys, Group Support IS Community of Interest Customer communities are not integrated into ES.

  10. Decision Support System Capability of ES User interfaces in organizational departments Data cubes Data Warehouse ES Engine & Broker Data Warehouse (DW) is a large repository of data extracted from corporate databases. This software is purchased separately from standard ES software. DW is not relational database, but has its own tables, keys, and data models. DW is used for building data cubes.* The capability of data cubing makes ES a data-driven DSS. Corporate centralized Databases

  11. Enterprise System Costs • Initial tangible costs of an Enterprise System: • Software and Hardware purchasing price • Configuration cost (costs of setting up ES) • Training cost (users need to be trained to use ES and new processes) • ES (like SAP) may require big changes in business processes. This may stir up employees’ reluctance or rejection of ES  intangible costs. • A large company, with over 1,000 employees, can spend from $50 million to $500 million on an ES. ES is a “Cadillac” of information systems – it may cost a lot! • Management should have a clear picture of total cost of ownership though whole life of system* before deciding to invest in ES.

  12. ERP System Benefits • Better process composition due to implementing best practice processes • Better coordination in and between organizational processes – optimized processes & seamless data flows across enterprise. • Increased speed of processes & process time savings. Customer value across the board. • Improved management control (a business document or even a single piece of data can be tracked down)* • Better decision-making based on better data (see before) - readily available and integrated data; reports covering entire company. (Management value).

  13. Summary • Enterprise System (ES) (or Enterprise Resource Planning System – ERPS) is an integrated information system that carries business processes for several departments or in an entire organization. . • Data management is standardized to provide an integrated view of business – ES is a TPS/MIS for whole enterprise. With additions, ES works as a data-driven DSS. • Databases for ES can be very complex and made by different vendors than is the ES software. • ES costs can be large and should be accounted for the entire system life. Intangible costs include organizational change and employee resistance. • ES improves process performance due to better coordination across the enterprise, elimination of complexity associated with separate departmental IS, time savings, more effective management control, and decision making using integrated view of enterprise.

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