LET'S ROCK! CHAPTER 12 : INTEGRATING THE ORGANIZATION FROM END TO END- ENTERPRISE RESOURCE PLANNING

Enterprise Resource Planning (ERP)

• It serves as the organization’s backbone in providing fundamental decision making support.
• It enables people in different business areas to communicate.
• ERP system helps an organization to obtain operational efficiencies, lower costs, improve supplier and customer relations, and increase revenues and market share.
•  The heart of an ERP system is a central database that collects information from and feeds information into all the ERP system’s individual application components (called modules), supporting diverse business function such as accounting, manufacturing, marketing, and human resources.
• ERP automates business processes such as order fulfillment- taking an order from a customer, shipping the purchase, and then billing for it.

ERP Integration Data Flow

 ERP Process Flow

Bringing the Organization Together

• ERP enables employees across the organization to share information across a single, centralized database.
• With extended portal capabilities, an organization can also involve its suppliers and customers to participate in the workflow process, allowing ERP to penetrate the entire value chain, and help the organization achieve greater operational efficiency.

 Organization before ERP

 ERP- Bringing the Organization Together

The Evolution of ERP

·      Although ERP solutions were developed to deliver automation across multiple units of an organization, to help facilitate the manufacturing process and address issues such as raw materials, inventory, order entry, and distribution, ERP was unable to extend to other functional areas of the company such as sales, marketing, and shipping. It could not tie to any CRM capabilities that would allow organizations to capture customer-specific information, nor did it work with websites or portals used for customer service or order fulfillment.

Integrating SCM, CRM, and ERP

·      Integration of SCM, CRM, and ERP is the key to success for many companies.  Integration allows the unlocking of information to make it available to any user, anywhere, anytime.

 2 main competitors in ERP market:

1.    Oracle

2.    Sap

 Primary Users and Business Benefits of Strategic Initiatives.

Integration Tools

·         An integrated enterprise infuses support areas, such as finance and human resources, with a strong customer orientation.

·         Integration are achieved using:

•    Middleware- several different types of software that sit in the middle of and provide connectivity between two or more software applications. It translates information between disparate systems

·         Enterprise application integration (EAI) middleware- represents a new approach to middleware by packaging together commonly used functionality, such as providing prebuilt links to popular enterprise applications, which reduces the time necessary to develop solutions that integrate applications from multiple vendors.

 Integration between SCM, CRM, and ERP Applications.

·         Companies run on independent applications, such as SCM, CRM, and ERP. If one application performs poorly, the entire customer value delivery system is affected.

Enterprise Resource Planning’s Explosive Growth:

Reasons of ERP being proven to be such a powerful force:

• ·ERP is a logical solution to the mess of incompatible applications that had sprung up  in most businesses.
• ·ERP addresses the need for global information sharing and reporting.
• ·ERP is used to avoid the pain and expense of fixing legacy systems

To qualify as a true ERP solution, the system not only must integrate various organization processes, but also must be:

·Flexible- an ERP system should be flexible in order to respond to the changing needs of an enterprise.

·Modular and open- an ERP system has to have open system architecture, meaning that any module can be interfaced with or detached whenever required without affecting the other modules. The system should support multiple hardware platforms for organizations that have a heterogeneous collection of systems. It must also support third- party add-on components.

·Comprehensive- an ERP system should be able to support a variety of organizational functions and must be suitable for a wide range of business organizations.

· Beyond the company- an ERP system must not be confined to organizational boundaries but rather support online connectivity to business partners or customers.

Everyone involved in sourcing, producing, delivering the company’s product works with the same information, which eliminates redundancies, cuts wasted time, and removes misinformation.

LET'S ROCK! CHAPTER 11 : BUILDING A CUSTOMER - CENTRIC ORGANIZATION - CUSTOMER RELATIONSHIP MANAGEMENT

Customer Relationship Management (CRM)

CRM is a business philosophy based on the premise that those organizations that understand the needs of individual customers are best positioned to achieve sustainable competitive advantage in the future.

- A customer strategy starts with understanding who the company's customers are and how the company can meet strategic goals.

- As the business world increasingly shifts from product focus to customer focus, most organizations recognize the treating existing customers well is the best source of profitable and sustainable revenue growth in the age of e-business, however, an organization is challenged more than ever before to truly satisfy its customers.

Recently, Frequency, and Monetary Value

An organization can find its most valuable customers by using a formula that industry insiders call RFM-recency, frequency, and monetary value. In other words, an organization must track:

- How recently a customer purchased items (recently)

- How frequently a customer purchases an item (frequently

- How much a customer spends on each purchase (monetary value)

The evolution of CRM

Knowing the customer, especially knowing the profitability of individual customers, is highly lucrative in the financial service industry.

There are three phases in the evolution of CRM:

1.    CRM Reporting technology help organizations identify their customers across other applicants

2.   CRM analysis technology helps organizations segment their customers into categories such as best and worst customers.

3. CRM predicts technological help organizations make predictions regarding customer behavior such as which customers are at risk of leaving.

The Ugly Side of CRM: Why CRM Matters More Now than Ever Before

Now companies have no choice as the power of the customer grows exponentially as the internet grows. In every case, customers have become an integral part of the action as a member of the aggregated, interactive, self-organizing, auto-entertaining audience on businesses. However, this should no be a surprise, since it was the customers crazy passion and hobbies and obsessions-that build up the web in the first place.

Customer Relationship Management's Explosive Growth

When customers buy on Internet, they see, and they steer, entire value chains.

- Customer web interaction become conversations, interactive dialogs with shared knowledge, not just business transaction. Web- based customer care can actually become the focal point of customer relationship management and provide breakthrough benefits for both the enterprise and its customers, substantially reducing costs while improving service.

- Current users allow allocating 20 percent of their IT budget to CRM solutions.

Using Analytical CRM to Enhance Decisions

The two components of a CRM strategy are:

- Operational CRM supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers.

- Analytical CRM supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers.

The primary difference between operational CRM and analytical CRM in the direct interaction between the organization and its customers.

-Personalization occurs when a website can know enough about a person's likes and dislikes that it can fashion offers that are more likely to appeal to that person. Many organizations are now utilizing CRM to create customer rules and templates that marketers can use to personalize customer messages.

Customer Relationship Management Success Factor

CRM solutions make organizational business processes more intelligent. This is achieved by understanding customer behavior and preferences, then realigning product and service offering and related communications to make sure they are synchronized with customer needs and preferences. If an organization is implementing a CRM system, it should study the industry best practices to help ensure a successful implementation.

Using he analytical capabilities of CRM can help a company Anticipate customer need and proactively serve customers in way that build relationship, create loyalty, and enhance bottom lines.

LET'S ROCK! CHAPTER 10 : SUPPLY CHAIN MANAGEMENT

WHAT is Supply Chain Management?

- Companies that excel in supply chain operations perform better in almost every financial measure of success, according to a report from Boston-based MR Research Inc.

- These companies understand that value chain performance translates to productivity and market-share leadership.

how the supply chain is related.

What is the Basics of Supply Chain

 A supply chain consists of all parties involved, directly or indirectly, in the procedurement of a product or raw material.

- Organization must embrace technologies that can effectively manage and oversee their supply chain.

supply chain management involves the management of information flow between and among stages in a supply chain to maximize total supply chain effectiveness and profitability.

Information Technology's Role in the Supply Chain

• The notion of virtually seamless information links within and between organizations is an essential element of integrated supply chain.
• Information technology's primary role in SCM is creating the integration or tight process and information linkages between functions within a firm.
• Considerable evidence shows that this type of supply chain integration results in superior supply chain capabilities and profits.

VISIBILITY

Supply chain visibility is the ability to view all areas up and down the supply chain.

Bullwhip effect occurs when distorted products demand information passes from one entity to the next through the supply chain.

*Information technology allows additional visibility in the supply chain.

CONSUMER BEHAVIOR

Demand planning software generates demand forecasts using statistical tools and forecasting techniques.

Ones an organization understand customer demand and its effect on the supply chain it can begging to estimate the impact that its supply chain will have on its customers and ultimately the organization's performance.

COMPETITION

Supply chain management can be broken down in 2"

1.Supply chain planning software: uses advanced mathematical algorithms to improve the flow and efficiency of the supply chain while reducing inventory. SCP depends entirely on information for its accuracy.

2.Supply chain executive (SCE) software automates the different stems and stages of the supply chain.

SPEED

During the past decade, competition has focused on speed. New forms of severs, telecommunications enabling companies to perform activities that were once never thought possible.

Another aspect of speed is the company's ability to satisfy continually changing customer requirements efficiently, accurately, and quickly.

What is the Supply Chain Management Success Factors

To succeed in today's competitive markets, companies must align their supply chains with the demands of the markets key serve.

To achieve success such as reducing operation costs, improving asset productivity, and compressing order cycle time, and organization should follow the seven principles of SCM outlines.

One of the benefits is to know immediately what is being transacted at the customer and of the supply chain instead of waiting days or weeks for the information to flow.

Organizations should study industry best practices to improve their chances of successful implementation of SCM systems. The following are keys to SCM success.

MAKE THE SALE TO SUPPLIERS

The hardest part of any SCM system is its complexity because a large part of the system extends beyond the company's walls.

WEAN EMPLOYEES OF TRADITIONAL BUSINESS PRACTICES

Operations people typically deal with phone calls, faxes, and orders scrawled on paper and will most likely want to keep it that way.

ENSURE THE SCM SYSTEM SUPPORTS THE ORGANIZATIONAL GOALS

It is important to select SCM software that give organizations and advantage in the areas most crucial to their business success.

DEPLOY IN INCREMENTAL PHASES AND MEASURE AND COMMUNICATE SUCCESS

Design the deployment of the SCM system in incremental phases.

BE FUTURE ORIENTED

The supply chain design must anticipate the future state of the business.

LET'S ROCK! CHAPTER 9: ENABLING THE ORGANIZATIONS - DECISION MAKING

DECISION SUPPORT SYSTEMS

-Decision support systems (DSS) – models information to support managers and business professionals during the decision-making process

-Three quantitative models used by DSSs include :

1. Sensitively analysis – the study of the impact that changes in one (or               more) parts of the model have on other parts of the model

2. What-if analysis – checks the impact of a change in an assumption on the proposed solution

3. Goal-seeking analysis – finds the inputs necessary to achieve a goal such as a desired level of output

EXECUTIVE INFORMATION SYSTEMS

-Executive information system (EIS) – a specialized DSS that supports senior level executives within the organization

-most EISs offering the following capabilities :

1.consolodation– involves the aggregation of intelligent system that mimics the evolutionary, survival-of-the-fittest process to generate increasingly better solutions to a problem

2.drill-down – enables, users to get details and details of details, of information

3.slice-and-dice – looks at information from different perspectives

ARTIFICIAL INTELLIGENCE

-INTELLIGENT SYSTEM – various commercial applications of artificial intelligence

-ARTIFICIAL INTELLIGENCE (AI) – Simulates human intelligence such as the ability to reason and learn

-advantages: can check info on competitor

-the ultimate goal of AI is the ability to build a system that can mimic human intelligence

-Four most common categories of AI include :

1. expert system – computerized advisory programs that imitate the reasoning processes of expert in solving difficult problems

2. neural network – attempts to emulate the way the human brain works

-fuzzy logic – a mathematical method of handling imprecise or      subjective information

3. genetic algorithm – an AI system that mimics the evolutionary, survival-if-the-fittest process to generate increasingly better solutions to a problem

4. intelligent agent – special-purposed-knowledge-based information system that accomplishes specific tasks on behalf of its users

DATA-MINING

-data-mining software includes many forms of AI such as neural networks and expert system

-common forms of data-mining analysis capabilities include:

1. cluster analysis

2. association detection

3. statistical analysis

CLUSTER ANALYSIS

-CLUSTER ANALYSIS – To divide an information set into mutually exclusive groups such that the members of each group are as possible to one another and the different groups are as far apart as possible

-CRM systems depend on cluster analysis to segment customer information and identify behavioral traits

ASSOCIATION DETECTION

-Association detection reveals the degree to which variables are related and the nature and frequency of these relationships in the information

-Market basket analysis such items as Web sites and checkout scanner information to detect customers’ buying behavior and predict future behaviour by identifying affinities among customers’ choices of products and services

STATISTICAL ANALYSIS

STATISTICAL ANALYSIS performs such functions as information correlations, distributions, calculations and variance analysis

- forecast– predictions made on the basis of time-series information

- time-series information – time-stamped information collected at a particular frequency

LET'S ROCK! CHAPTER 8 : DATA WAREHOUSE

It is a logical collection of information that gathered from many different operational databases that supports business activities & decision making start.

Data warehouse compiled information from internal or transactional/operational databases & external databases through extraction, transformation, and loading (ETL)Data warehouse sends subsets of the information to data mart. Information is multidimensional : contains layers of columns and rows To present multidimensional information, a cube is used in common term.

Data mining is the process of analyzing data to extract information not offered by raw data alone and to  perform it, users need data mining tools such as query tools, reporting tools, statistical tools and intelligent agent. This tools use a variety of techniques to find patterns and relationship in large volume of information.

To  increase quality of organizational information and effectiveness, businesses must develop strategy to keep information clean. Information cleansing or scrubbing is process that weed out & fixes or discard inconsistent, incorrect or incomplete information. In addition, business intelligence is information that people use to support their decision making efforts. Principle BI enablers include technology, culture and people.

LET'S ROCK! CHAPTER 7: STORING ORGANIZATIONAL INFORMATION - DATABASE

1. FUNDAMENTAL CONCEPTS OF THE RELATIONAL DATABASE MODEL

A relational database is a core, a system for storing and using data based upon the relationships among the elements of data. 

Different as databases may be in size, they are generally always structured according to one of three database models:

Relational = Nowadays, new installations of database management systems are almost exclusively of the relational type. Organizations that

already have a major investment in hierarchical or network technology

may add to the existing model, but groups that have no need to maintain

compatibility with “legacy systems” nearly always choose the relational

model for their databases.

Hierarchical = Hierarchical databases are aptly named because they have

a simple hierarchical structure that allows fast data access. They suffer

from redundancy problems and a structural inflexibility that makes database modification difficult.

Network = Network databases have minimal redundancy but pay for that

advantage with structural complexity.

A cube is one way to illustrate relations among data as it helps to visualize data intersections. While it is easiest for us to picture a three-dimensional cube, a relational database stores data in many dimensions. 

2.THE ADVANTAGES OF RELATIONAL DATABASE

increased flexibility      

increased information security   

 increased information integrity

reduced information redundancy

 increased scalability and performance

3. DATABASE MANAGEMENT SYSTEM & RELATIONSHIP WITH WEBSITE

   - A Database Management System (DBMS) is a set of programs that enables you to store,modify, and extract information from a database.

- It also provides users with tools to add, delete, access, modify, and analyze data stored in one location.

-  A group can access the data by using query and reporting tools that are part of the DBMS or by using application programs specifically written to access the data. 

- DBMS also provide the method for maintaining the integrity of stored data, running security and users access, and recovering information if the system fails

- Many DBMS also include a graphics component that enables you to output information in the form of graphs and charts. Database and database management system are essential to all areas of business, they must be carefully managed.

Consider for example, a company selling sports cars. A database is created with information on each of its currently available cars e.g. make, model, engine details, year, a photograph, etc. A visitor to the website clicks on Porsche, the visitor enters the price range that they are interested in and hits 'Go'. The visitor is presented with information on available Porsche cars in their price range and an invitation to purchase or request more information from the company. The company has the ability to add new cars to the database, remove them or modify existing entries - this is achieved via a secure administration area on the website.

customer can click faster and the other page can appear as far as possible.

this is an example of website that people can surfing the internet. Google, Mozilla, Explore and etc.

4. WHY ORGANIZATION WOULD WANT TO INTEGRATE ITS DATABASE?

Data integration refers to the organization’s inventory of data and information assets as well as the tools, strategies and philosophies by which fragmented data assets are aligned to support business goals.

company want to integrate its database because they will connect,communicate,dealing and having relation with its customer everyday. Everyday its customers will open the webpage and search anything appear on the page. Therefore, if the product still available or not available the supplier must inform the customers immediately.Publish the information on the web page to make the customers realize that the product exist or not in the market. Then, when the customers got information they will not too disappointed and not waiting too long. Customers satisfy, the business relationship between sellers and customers will be good.