Campbellsville University Managing and Using Information Systems Paper Please take a moment to share your thoughts, ideas, comments and / or questions conc

Campbellsville University Managing and Using Information Systems Paper Please take a moment to share your thoughts, ideas, comments and / or questions concerning Week 5’s reading assignment lecture.need a paper of at-least 350 words in APA Format with 2 rferences Managing and Using Information Systems:
A Strategic Approach – Sixth Edition
Keri Pearlson, Carol Saunders,
and Dennis Galletta
© Copyright 2016
John Wiley & Sons, Inc.
Chapter 5
IT and Business Transformation
Sloan Valve
•What was wrong with their Product
Development Process?
•What did Sloan do? What is NPD?
•Did it help?
•Are all enterprise system implementations this
© 2016 John Wi ley & Sons, Inc.
© 2016 John Wi ley & Sons, Inc.
Silo (Functional) Perspective
• Specialized functions (sales, accounting, production, etc.
Executive Offices
• Advantages:
• Allows optimization of expertise.
• Group like functions together for transfer of knowledge.
• Disadvantages:
• Sub-optimization (reinvent wheel; gaps in communication;
• Tend to lose sight of overall organizational objectives.
© 2016 John Wi ley & Sons, Inc.
The Process Perspective
• Examples of processes:
• Fulfill customer orders
• Manufacturing, planning, execution
• Procurement (see below)
Requirement for
Create and Send
Purchase Order
Receive Goods
Verify Invoice
Pay Vendor
• Processes have:
• Beginning and an end
• Inputs and outputs
• A process to convert inputs into outputs
• Metrics to measure effectiveness
• They cross functions
© 2016 John Wi ley & Sons, Inc.
Cross-Functional Nature of Business Processes
© 2016 John Wi ley & Sons, Inc.
How to Manage a Process
• Identify the customers of processes (who receives
the output?)
• Identify the customers’ requirements (how do we
judge success?)
• Clarify the value each process adds to the
organizational goals
• Share this perspective so the organization itself
becomes more process focused
© 2016 John Wi ley & Sons, Inc.
Comparison of Silo Perspective and
Business Process Perspective
Silo Perspective
Business Process
Self-contained functional units
such as marketing, operations,
Interrelated, sequential set of
activities and tasks that turns
inputs into outputs
Optimizes on functional goals,
which might be suboptimal for
the organization
Optimizes on organizational
goals, or the “big picture”
Highlighting and developing
core competencies; functional
Avoiding work duplication and
cross-functional communication
gaps; organizational
Redundancy of information
throughout the organization;
cross-functional inefficiencies;
communication problems
Difficult to find knowledgeable
generalists; sophisticated
software is needed
What do you do when things change?
•Dynamic and agile processes
• Agile: Autos are built with wires and space for
• Dynamic: Call centers route incoming or even
outgoing calls to available locations and agents
• Software defined architectures (see chapter 6)
•IT is required to pull this off well
© 2016 John Wi ley & Sons, Inc.
Techniques to Transform a Static
•Radical process redesign
• Also known as business process reengineering
•Incremental, continuous process
• Including total quality management (TQM) and
Six Sigma
© 2016 John Wi ley & Sons, Inc.
Incremental Change
• Total Quality Management
• Often results in favorable reactions from personnel
• Improvements are owned and controlled
• Less threatening change
• Six-Sigma is one popular approach to TQM
• Developed at Motorola
• Institutionalized at GE for “near-perfect products”
• Generally regarded as 3.4 defects per million opportunities for
defect (6 std dev from mean)
© 2016 John Wi ley & Sons, Inc.
Radical Change
• Business Process Reengineering (BPR)
• Sets aggressive improvement goals.
• Goal is to make a rapid, breakthrough impact on key
metrics in a short amount of time.
• Greater resistance by personnel.
• Use only when radical change is needed.
© 2016 John Wi ley & Sons, Inc.
Comparing the Two
© 2016 John Wi ley & Sons, Inc.
Key Aspects of Radical Change
• Need for quick, major change
• Thinking from a cross-functional process
• Challenge to old assumptions
• Networked (cross-functional organization)
• Empowerment of individuals in the process
• Measurement of success via metrics tied to
business goals and effectiveness of new processes
© 2016 John Wi ley & Sons, Inc.
Workflow and Mapping Processes
• Workflow diagrams show a picture of the sequence
and detail of each process step
• Objective is to understand and communicate the
dimensions of the process
• Over 200 products are available to do this
• High-level overview chart plus detailed flow
diagram of the process
© 2016 John Wi ley & Sons, Inc.
• Information systems tools used to enable information
flow within and between processes.
• Comprehensive, enterprise software packages.
• Most frequently discussed:
• ERP (Enterprise Resource Planning),
• CRM (Customer Relationship Management),
• SCM (Supply Chain Management)
• Designed to manage the potentially hundreds of
systems throughout a large organization.
• SAP, Oracle, Peoplesoft are the most widely used ERP
software packages in large organizations.
© 2016 John Wi ley & Sons, Inc.
BPM Architecture
© 2016 John Wi ley & Sons, Inc.
Standardization vs Integration
Business Process Standardization
Business Process
Single face to customers
High needs for reliability,
and suppliers but standards predictability, and sharing;
not enforced internally
single view of process
Decentralized design;
business units decide how
to meet customer needs
Tasks are done the same way
across units, but there is little
need for business units to
Source: J. Ross “Forget Strategy: Focus IT on your Operating Model,”
MIT Center for Information Systems Research Briefing (December 2005)
© 2016 John Wi ley & Sons, Inc.
Enterprise Systems (Enterprise Resource
Planning or ERP)
• Seamlessly integrate information flows throughout the
• Reflect industry “best” practices.
• Need to be integrated with existing hardware, OSs,
databases, and telecommunications.
• Some assembly (customization) is required
• The systems evolve to fit the needs of the diverse
© 2016 John Wi ley & Sons, Inc.
ERP Advantages and Disadvantages
Represent “best practices”
Enormous amount of work
Modules throughout the
organization communicate with
each other
Require redesign of business
practices for maximum benefit
Require customization if special
features are needed
Enable centralized decision-making
Eliminate redundant data entry
Very high cost
Enable standardized procedures in
different locations
Sold as a suite, not individual
Requires extensive training
High risk of failure
© 2016 John Wi ley & Sons, Inc.
• Makes information available to external
stakeholders too
• Enables e-business applications
• Integrates into the cloud
• Includes ERP plus other functions (see Figure 5.8)
© 2016 John Wi ley & Sons, Inc.
ERP and ERP II Functions
© 2016 John Wi ley & Sons, Inc.
Customer Relationship
• Customer Relationship Management (CRM) is a
natural extension of applying the value chain model
to customers.
• CRM includes many management activities
performed to
• obtain,
• enhance relationships with, and
• retain customers.
• CRM can lead to better customer service, which
leads to competitive advantage for the business.
© 2016 John Wi ley & Sons, Inc.
•Common systems are:
• Oracle
• (web-based cloud system)
•Oracle and SAP integrate into their ERP
© 2016 John Wi ley & Sons, Inc.
Supply Chain Management (SCM)
• An enterprise system that manages the integrated
supply chain
• Translation: processes are linked across companies
• The single network optimizes costs and
opportunities for all companies in the supply chain
• Every part of the supply chain has the latest
information about sales expected and inventories
from source materials at all stages
• Bullwhip effect occurs when the supplier at each
stage adds a small “buffer” for it’s suppliers in case
demand is higher than expected
© 2016 John Wi ley & Sons, Inc.
Difficulties in Integrated Supply Chains
• Information integration requires agreement of what
information to share, how to share it, and the
authority to view it.
• Trust must be established
• Planning must be synchronized carefully
• Workflow must be coordinated between partners to
determine what to do with the information they
© 2016 John Wi ley & Sons, Inc.
Advantages and Disadvantages
of Enterprise Systems
© 2016 John Wi ley & Sons, Inc.
The Adoption Decision
• The enterprise system sometimes should drive
business process redesign when:
• Just starting out.
• Organizational processes are not relied upon for strategic
• Current systems are in crisis.
• It is inappropriate for the enterprise system to drive
business process redesign when:
• Changing an organization’s processes that are relied upon for
strategic advantage.
• The package does not fit the organization.
• There is a lack of top management support.
© 2016 John Wi ley & Sons, Inc.
Managing and Using Information Systems:
A Strategic Approach – Sixth Edition
Keri Pearlson, Carol Saunders,
and Dennis Galletta
© Copyright 2016
John Wiley & Sons, Inc.

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