Fundamentals of Information Systems, Sixth Edition

1. Fundamentals of Information Systems, Sixth Edition Chapter 5 Electronic and Mobile Commerce and Enterprise Systems

2. Why Learn About Electronic and Mobile Commerce and Enterprise Systems? • Electronic and mobile commerce and enterprise systems: • Have transformed many areas of our lives and careers • One fundamental change has been: • The manner in which companies interact with their suppliers, customers, government agencies, and other business partners

3. An Introduction to Electronic Commerce • Electronic commerce: • Conducting business activities electronically over computer networks • Business activities that are strong candidates for conversion to e-commerce: • Paper-based • Time-consuming • Inconvenient for customers Fundamentals of Information Systems, Sixth Edition

4. Business-to-Business (B2B) E-Commerce • Subset of e-commerce • All the participants are organizations • Useful tool for connecting business partners in a virtual supply chain to cut resupply times and reduce costs

5. Business-to-Consumer (B2C) E-Commerce • Form of e-commerce in which customers deal directly with an organization and avoid intermediaries • Disintermediation: • The elimination of intermediate organizations between the producer and the consumer Fundamentals of Information Systems, Sixth Edition

6. Consumer-to-Consumer (C2C) E-Commerce • Subset of e-commerce that involves consumers selling directly to other consumers • Popular sites: Bidzcom, Craigslist, eBid, Kijiji ePier, Ibidfree, Ubid, and Tradus

7. Consumer-to-Consumer (C2C) E-Commerce (continued)

8. e-Government • Use of information and communications technology to: • Simplify the sharing of information • Speed formerly paper-based processes • Improve the relationship between citizen and government • Forms of e-Government • Government-to-consumer (G2C) • Government-to-business (G2B) • Government-to-government (G2G) Fundamentals of Information Systems, Sixth Edition

9. Mobile Commerce • Mobile commerce (m-commerce) relies on the use of wireless devices • The Internet Corporation for Assigned Names and Numbers (ICANN): • Created a .mobi domain to help attract mobile users to the Web Fundamentals of Information Systems, Sixth Edition

10. Advantages of Electronic and Mobile Commerce

11. E-Commerce and M-Commerce Technology Infrastructure

12. Hardware • Key e-commerce infrastructure ingredient: • Web server hardware platform complete with the appropriate software • Key decision facing new e-commerce companies: • Whether to host their own Web site or to let someone else do it

13. Web Server Software • Each e-commerce Web site must have Web server software to perform fundamental services: • Security and identification • Retrieval and sending of Web pages • Web site tracking • Web site development • Web page development

14. E-Commerce Software • Investigate and install e-commerce software to support five core tasks: • Catalog management to create and update the product catalog • Product configuration to help customers select the necessary components and options • Shopping cart facilities to track the items selected for purchase • E-commerce transaction processing • Web traffic data analysis to provide details to adjust the operations of the Web site

15. Mobile Commerce Hardware and Software • For m-commerce to work effectively: • The interface between the wireless, handheld device and its user must improve • Encryption can provide secure transmission • Wireless Application Protocol (WAP): • Standard set of specifications for Internet applications that run on handheld, wireless devices

16. Electronic Payment Systems • Digital certificate: • Attachment to an e-mail message or data embedded in a Web site that verifies the identity of a sender or Web Site • Certificate authority (CA): • Trusted third-party organization or company that issues digital certificates • Example: Verisign • Secure Sockets Layer (SSL): • Used to secure sensitive data: https

17. Electronic Payment Systems Fundamentals of Information Systems, Sixth Edition

18. An Overview of Transaction Processing Systems • Transaction processing systems (TPSs): • Capture and process detailed data necessary to update records about fundamental business operations • Include order entry, inventory control, payroll, accounts payable, accounts receivable, general ledger, etc. • Provide employees with data to help them achieve their goals Fundamentals of Information Systems, Sixth Edition 18 Fundamentals of Information Systems, Sixth Edition

19. An Overview of Transaction Processing Systems (continued)

20. Traditional Transaction Processing Methods and Objectives • Batch processing system: • Data processing in which business transactions are: • Accumulated over a period of time • Prepared for processing as a single unit or batch • Online transaction processing (OLTP): • Data processing in which each transaction is processed immediately

23. Transaction Processing Activities • TPSs: • Capture and process data that describes fundamental business transactions • Update databases • Produce a variety of reports • Transaction processing cycle: • The process of data collection, data editing, data correction, data manipulation, data storage, and document production

25. Data Collection • Capturing and gathering all data necessary to complete the processing of transactions • Data collection can be: • Manual • Automated via special input devices • Data should be: • Collected at source • Recorded accurately, in a timely fashion

26. Data Collection (continued)

27. Data Editing • Checking data for validity and completeness to detect any problems • Examples: • Quantity and cost data must be numeric • Names must be alphabetic

28. Data Correction • Reentering data that was not typed or scanned properly • Error messages must specify the problem so proper corrections can be made Fundamentals of Information Systems, Sixth Edition

29. Data Manipulation • Performing calculations and other data transformations related to business transactions • Can include: • Classifying data • Sorting data into categories • Performing calculations • Summarizing results • Storing data in the organization’s database for further processing

30. Data Storage • Updating one or more databases with new transactions • After being updated, this data can be further processed and manipulated by other systems

31. Document Production and Reports • Generating output records, documents, and reports: • Hard-copy paper reports • Displays on computer screens • Results from one TPS can be inputs to another system

32. Traditional Transaction Processing Applications • A TPS typically includes the following types of systems: • Order processing systems • Accounting systems • Purchasing systems

33. Enterprise Resource Planning (ERP) • ERP systems: • Central to the organization • Ensure information can be shared across all business functions • Employ a database of key operational and planning data that can be shared by all

34. Enterprise Resource Planning

35. An Overview of Enterprise Resource Planning (ERP) • ERP systems: • Evolved from materials requirement planning systems (MRP) • Large organizations: • The first to take on the challenge of implementing ERP

36. Advantages of ERP • Improved access to data for operational decision making • Elimination of costly, inflexible legacy systems • Improvement of work processes • Upgrade of technology infrastructure Fundamentals of Information Systems, Sixth Edition

37. Disadvantages of ERP Systems • Expense and time in implementation • Difficulty implementing change • Difficulty integrating with other systems • Difficulty in loading data into new ERP system • Risks in using one vendor • Risk of implementation failure

38. Supply Chain Management (SCM) • A system that includes: • Planning, executing, and controlling all activities involved in raw material sourcing and procurement • Converting raw materials to finished products and warehousing and delivering finished product to customers Fundamentals of Information Systems, Sixth Edition

39. Supply Chain Management (SCM) • Process for developing a production plan: • Sales forecasting • Sales and operations plan (S&OP) • Demand management • Detailed scheduling • Materials requirement planning (MRP) • Purchasing • Production Fundamentals of Information Systems, Sixth Edition

40. Financial and Managerial Accounting • General ledger: • Main accounting record of a business • ERP system: • Captures transactions entered by workers in all functional areas of the business • Creates associated general ledger record to track the financial impact of the transaction Fundamentals of Information Systems, Sixth Edition

41. Customer Relationship Management (CRM) • Key features of a CRM system: • Contact management • Sales management • Customer support • Marketing automation • Analysis • Social networking • Access by smartphones • Import contact data

42. Hosted Software Model for Enterprise Software • Many business application software vendors: • Are pushing the use of the hosted software model for SMEs • Using the hosted software model: • Means the small business firm does not need to employ a full-time IT person to maintain key business applications

43. Hosted Software Model for Enterprise Software (continued)

44. International Issues Associated with Enterprise Systems • Challenges that must be met by an enterprise system of a multinational company include: • Different languages and cultures • Disparities in IS infrastructure • Varying laws and customs rules • Multiple currencies Fundamentals of Information Systems, Sixth Edition

45. Summary • Electronic commerce: • Conducting business activities electronically over computer networks • Mobile commerce: • The use of wireless devices such as cell phones and smartphones to facilitate the sale of goods or services—anytime, anywhere • Electronic payment systems: • Key component of the e-commerce infrastructure Fundamentals of Information Systems, Sixth Edition

46. Summary (continued) • Transaction processing system: • An organized collection of people, procedures, software, databases, and devices • Enterprise resource planning (ERP) software • Supports the efficient operation of business processes • Production and supply chain management process starts with sales forecasting Fundamentals of Information Systems, Sixth Edition

47. Summary (continued) • A CRM: • Helps an organization build a database about its customers • Challenges faced by multinational corporations when planning, building, and operating their TPSs: • Dealing with different languages and cultures • Disparities in IS infrastructure • Varying laws and customs rules • Multiple currencies Fundamentals of Information Systems, Sixth Edition