ITM 309 Spring, 2013Exam Three Topics: Review Outline – 4/24/13Enterprise Applications: SCM, CRM, and ERP – Chapter 8Dell Case and Class Discussion- Dell- one of the largest direct PC manufacturers—less inventory and faster deliveries than its competitors - Dell though they could customize every order for every customer, but they cant so then offered preconfigured models that cant be changed- Retailers recommend specific models to customers so the channel cannot be bypassed - Dell skips the retailer in value chain because it is direct Business Models- Conceptual framework that expresses the underlying economic logic and system that prove how a business can deliver value to customersat an appropriate cost and make money - Specifies value, products, services, prices, organization, operation, all essential components that fit into a complete system - BUSINESS MODEL KEY QUESTIONSSCM Definition and Activities- SCM definition- involves the management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability - Visibility- the ability to view all areas up and down the supply chain inreal time - Planning system- uses advanced mathematical algorithms to improvethe flow and efficiency of the supply chain while reducing inventory - Execution system- automates the different activities of the supply chain - Bullwhip effect- occurs when distorted product demand information ripples from one partner to the next throughout the supply chain SCM Benefits and ChallengesBenefits-- Companies can respond faster and more effectively to consumer demand through supply chain enhances- Demand planning system- generates demand forecasts using statistical tools and forecasting techniques, so companies can respond faster and more effectively to consumer demands through supply chain enhancements - Supply chain metrics- back order, inventory cycle time, customer cycle time, inventory turnover Challenges - Cost- an SCM system can cost millions of dollars for the software and millions more for help implementing the system - Complexity- the move towards globalization is increasing complexity in the supply chain Future of SCM- Collaborative demand planning - Collaborative engineering- Selling chain management- Supply chain event management (SCEM)CRM Definition and BenefitsCRM definition- involves managing all aspects of a customer’s relationship with an organization to increase customer loyalty and retention and an organization’s profitability Benefits- - Organizations can find their most valuable customers through RFM (Recency, Frequency and Monetary value)- Identify an target their best customers to make them lifelong- Real-time customization and personalization based on customer needs- Keep track of when customer contacts company- Can enable company to provide consistent customer experience along all contact pointsEvolution of CRM: Phases- Reporting- identify their customers across other applications - Analysis- segment their customers into categories- Predicting- making predictions regarding customer behavior Operational and Analytical CRMOperations- supports traditional transactional processing for day-to-day front-office (customer facing areas-sales, mrkt, service) operations or systems that deal directly with the customers **DAY TO DAY, Front officeAnalytical- Supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers- website personalization (data mining to insight in their behavior quickly)Operational CRM TechnologiesMarketing- list generation, campaign mgmt. system, cross/up- sellingSales- prospecting, contact and opportunity management, sales force automation- a system that automatically tracks all of the steps in the sale sales processCustomer service- contact center, web-based self-service, trouble shooting Challenges and Future of CRMChallenges- Customer is always right and now has more power with internet- Lack of understanding and preparation- Relying on CRM to solve business problems without first developing the changes and management programs that are required- CRM implemented without the stakeholders involved Future- Collaborating and extending the enterpriseo Supplier, partner, employee relationship management ERP Definition and ComponentsDefinition- Integrates all departments and functions throughout an organization into a single IT system so that employees can make enterprise wide information on all business operations – internal and back office - Cross-functional backbone that integrates internal processes and information systems **core that holds everything together - Helps companies gain efficiency, agility and responsiveness- Integrated real-time view of core business processes- Integrated modules and relies upon common database management systemsCore and Extended ERPCore- traditional components include in most ERP systems and they primarily focus on internal operationsMost common core ERP components1. Accounting and finance- general ledger, accounts payable/ receivable, budgeting, asset management 2. Production and materials management- demand forecasting, production scheduling, job cost accounting, quality control3. Human resource- payroll, benefits, compensation, performance assessment complies with legal requirements and tax authorities Extended- extra components that meet the organizational needs not covered by the core components and primarily focus on external operations Extended ERP components- Business intelligence- Customer relationship management- Supply chain management- E-business- logistic, procurement ERP Benefits and CostsBenefits - Logical solution to incompatible applications- Addresses global information sharing and reporting- Avoids the pain and expense of fixing legacy systems- Core that holds everything together- Quality and efficiency- integration and improving internal processes- Decreased costs- significant reductions in transaction costs, supply chain costs, inventory, and IT costs- Decision Support- cross-functional information on business performance quickly to managers to significantly improve their abilityto make better decisions in a timely manner- Enterprise agility- ERP breaks down many former departmental and functional walls of business processes, information systems and information resources - Easton-bell video ERP Risks - Software costs- Consulting fees- Process rework- Customization- Integration and