REVIEW FOR EXAM 3Information Systems for Business Integration: ERP SystemsBusiness Integration?Systems for Horizontal IntegrationERP Components (or Modules)Slide 6Slide 7Factors in ERP System SuccessSummary QuestionsReview QuestionsInformation Systems for Business Integration: EDI, SCM, CRM SystemsSupply Chain Management SCMSupply ChainSlide 14SCM ProcessEDI: a SCM TechnologyEDI: SCM TechnologySCM information systemCustomer Relationship Management CRMCRM systemsGoals of CRM systemsSlide 22Slide 23Managing SecurityBest way to prepareManaging the Development and Purchase of ISSystems Development Methodology?QuestionsTraditional Systems Development Life Cycle (SDLC)QuestionPlanningSystems AnalysisSlide 33Data Flow Diagrams (DFD)DFD ExerciseSystems DesignSystems Design toolsDevelopmentDevelopment toolsTestingImplementationMaintenanceSlide 43SDLC: Recap1REVIEW FOR EXAM 3BUS3500 - Abdou Illia, Fall 20072Information Systems forBusiness Integration: ERP SystemsPart 13Business Integration?SalesDepartmentLogisticsDepartmentProductionDepartmentHorizontalIntegrationVerticalIntegrationSuppliersCustomers4Systems for Horizontal IntegrationEnterprise Resource Planning (ERP) systemsintegrate all the internal processes through a common information system (or an integrated set of info systems) ERP systemSalesDepartmentLogisticsDepartmentProductionDepartmentWarehousingMarketingDepartmentAccountingDepartmentProcess1 Process2Process1 Process2Process1 Process2 Process1 Process2Process1 Process2 Process1 Process2CommonDatabase5ERP Components (or Modules)Two types of componentsCore ERP ComponentsExtended ERP ComponentsCore ERP ComponentsTraditional components found in most ERP systemsThey primarily focus on internal operationsCommonDatabaseFinance &AccountingManufacturing** Also called Production & Material Management* Helps from new products development to actual production* Handles demand forecasting, production planning, production scheduling, quality control, etc.HumanResource6ERP Components (or Modules)Extended ERP ComponentsExtra components that might be includedThey primarily focus on external operationsCommonDatabaseCustomerRelationshipManagementSupplyChainManagementBusinessIntelligence1E-Business21 Provide information that help users in decision-making1 Collects info used throughout the organization, organize it, and uses analytical tools to help decision-making process2 Includes e-logistics (managing transportation & storage of goods over the Internet) and e-procurement (B2B purchase & sale of supplies & services over the Internet)7ERP Components (or Modules)ERP mainly used by medium and large businessesAverage lifetime cost: $15 Million (2003 surveys)Implementation process: up to 5 yearsThe largest vendors worldwide in 2005 according to Gartner Dataquest# Vendor Revenue(million$)Marketshare(%)1 SAP 4726 28.72 Oracle Applications* 1674 10.23 The Sage Group 1221 7.44 Microsoft Dynamics 616 3.75 SSA Global Technologies 464 2.8* In January 2005, Oracle bought PeopleSoft the 3rd player until then.8Factors in ERP System SuccessActive support of upper managementHaving the best people on the implementation teamManaging the time line wellUser involvement in the planning and implementing ERP systems9Summary QuestionsBook Notes1) What is the difference between Horizontal integration and Vertical integration? What could be the consequences of a bad horizontal integration?5,62) (a) What kind of information system is typically used by organizations for horizontal integration? 73) (a) What are the core modules found in ERP systems?.?104) What does the Manufacturing ERP component allow? Name some of the activities it handles105) Name the major three ERP software vendors 126) What are the success factors of ERP implementation?14Refers to the slide # in class posted notes10Review QuestionsMake sure you can answer the following questions about ERP:Chapter 10 Review Questions available in the Notes’ section of the course web site.Quiz 2 (Part 1/2)11Information Systems forBusiness Integration: EDI, SCM, CRM SystemsPart 1 (Cont.)12Supply Chain Management SCM13Supply ChainSupply Chain includes parties involved in the procurement of product or raw materialUpstream partiesDownstream parties14Supply Chain Management SCMSCM implies the management of information flow between a company and upstream and downstream parties of the supply chainWhich of the following is NOT a potential benefit of SCM?a) It helps avoid shortage of raw materialb) It could shorten the time for delivering finished products to distributorsc) It could help organizations better forecast their production of goods and servicesd) It could help organizations better forecast the needs of their distributorse) None of the above15SCM ProcessStages of SCM (SC Council’s Reference Model):1) Planning: develop and implement processes that attempt to forecast demand for products and servicesGoal: Balance demand with supply of raw material2) Sourcing: determine who should supply the items requiredGoal: Be supplied on time, within budget3) Production: make the product1) Schedule production2) Ensure raw materials are on hand when needed4) Product delivery (logistics) 1) Everything from receiving a customer inquiry to invoicing2) Warehouse management is one very important factor5) Returns: managing returns of raw materials as well as finished goods16EDI: a SCM TechnologyElectronic Data Interchange (EDI):A network technology that allows the transfer and processing of business documents (usually orders) between a company and its suppliers SuppliersCompany’s Internal processesSalesDepartmentProcess1Process2DeliveryDepartmentProcess1Process2ProductionDepartmentProcess1Process2EDI SystemValue Added Network (VAN)orPrivate network connectionEDI Sys.17EDI: SCM TechnologyEDI documents must be formatted according to specific standardsANSI X12 – used in North AmericaEDIFACT – international, but widely used in EuropeAdvantages:Eliminates paperworkReduces errorsSpeeds supply processDisadvantages:Provides connection only between two companiesLimits freedom of comparing prices.18SCM information systemPart of extended ERP componentsCould be bought separatelyCompany’s Internal processesSalesDepartmentProcess1Process2DeliveryDepartmentProcess1Process2ProductionDepartmentProcess1Process2SCM SystemNetwork
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