Chapter Two

Enterprise
Systems
 Points should be covered

 Meaning of Enterprise Systems

 Value of Systems Integration
 Enterprise Systems support for Organizational
Processes
 Examples of Enterprise Systems support for
Major Event Processes
 Meaning of Enterprise Systems

ES interdependent software modules with

a common central database that support
basic internal business processes for:
 Finance and accounting
 Human resources
 Manufacturing and production and
 Sales and marketing
 Cont’d

ES is a collection of software systems that help

to manage business processes for an entire
organization
Collects data from many divisions of firm
for use in nearly all of firm’s internal
business activities
Information entered in one process is
immediately available for other processes
 Examples

 DDU uses students information management

system(SIMS)
 Minister of finance and economic development
uses a soft ware knows as IBEX
 Dashen bank uses Oracle integrated module
for integrated banking service
Question: State some examples of collection of soft
wares used by other organizations???
 Cont’d

 The objective of ES is to integrate key

processes of the organization such as order
entry, manufacturing, procurement and accounts
payable, payroll, and human resources.
 ES combines all of these into a single, integrated
system that accesses a single database to
facilitate the sharing of information and to
improve communications across the
organization.
 Cont’d
 Companies need to purchase modules for an ES that
represent different functions within the organization.
 Some companies choose to purchase many modules,
others choose a subset of the modules.
 ES is designed to integrate all information processing
support for an entire organization .
 Enables data to be used by multiple functions and
business processes for precise organizational
coordination and control.
 Cont’d
 ES functionality falls into two general groups of
applications:
1. Core applications
2. Business analysis applications.
 Core applications are those applications that
operationally support the day-to-day activities of
the business.
 If these applications fail, so does the business
may be stopped or not operational.
 Cont’d
Typical core applications include, but are not limited
to:
1. Sales and distribution,
2. Business planning,
3. Production planning,
4. Shop floor control, and
5. Logistics.
Core applications are also called online transaction
processing (OLTP) applications.
 Cont’d
 However business analysis applications are
obtained or derived, they are central to their
successful function of core activities like data
warehouse.
 A data warehouse is a database constructed for quick
searching, retrieval, ad hoc queries, and ease of use.
 The data is normally extracted periodically from an
operational database or from a public information
service.
How Enterprise system work
 ES vendors

Small scale domestic suppliers

Microsoft

ORACLE (People Soft)

 Advantages enterprise systems

 A more uniform organization

 More efficient operations and customer-driven
business processes
 Provides Firm wide information for improved
decision making
 Enable rapid responses to customer requests for
information or products
 Include analytical tools to evaluate overall
organizational performance
Business process and enterprise system

 A crucial role of ES in business is to better

position the organization to change its
business processes.
 ES software have hundreds of business
processes built into the logic of the system
which may or may not agree with current
processes of an organization.
Business process and enterprise system

 When implementing an ES, organizations

have two choices:
Change business processes to match the
software functionality.
Modify the ES software to match the
business processes.
Enterprise Systems Components
Enterprise Systems Components
ES Components Integration
 System Benefits of an enterprise System

 Integration of data and applications across

functional areas (i.e., data can be entered
once and used by all applications; thus
improving accuracy and quality of the data).
 Improvements in maintenance and support as
IT staff is centralized.
System Benefits of an Enterprise System

 Consistency of the user interface across

various applications means less employee
training, better productivity, and cross-
functional job movements.
 Security of data and applications is
enhanced due to better controls and
centralization of hardware.
System Limitations of an Enterprise System

 Complexity of installing, configuring, and

maintaining the system increases, thus
requiring specialized IT staff, hardware, and
network facilities.
 Consolidation of IT hardware, software,
and people resources can be higher cost
and difficult to attain.
System Limitations of an Enterprise System

 Data conversion and transformation from an

old system to a new one can be a complex
process.
 Retraining of IT staff and end users of the new
system can produce resistance and reduce
productivity.
 Business Benefits of an enterprise system
System
 Increasing acceptability of the organization
in terms of responding to changes in
environment for growth and maintaining
market share.
 Increases collaboration between units as
they share Information's.
Business Benefits of an enterprise System

 Improves efficiency by linking and

exchanging information in real-time with
supply-chain partners.
 Better customer service due to quicker
information flow across departments.
Business Limitations of an Enterprise System

 Retraining of all employees with the new

system can be costly and time consuming.

 Change of business roles and department

boundaries can create upheaval and resistance
to the new system.
Examples of Enterprise Systems support & Major Event Processes

1. Supply Chain Management system

Network of organizations and business
processes for purchasing raw materials,
transforming into products, and distributing
them to customers
Materials, information, and payments flow
through the supply chain in both directions.
Supply Chain Management…..
 It is Integrated network
 Consisting of an organization, its suppliers,
transportation companies, and brokers
 Used to deliver goods and services to
customers
 Exist in both service and manufacturing
organizations
 Cont’d
In manufacturing firm, information in an SCM system
flows between the following areas:
 Product flow
 Information flow
 Finances flow
Four key decisions in supply chain management system
are:
 Location
 Inventory
 Production
 Transportation
 Cont’d
 Information technologies and the Internet play
a major role in implementing an SCM system
 Electronic Data Interchange (EDI)
 Enables business partners to send and receive
information on business transactions
 Helps for delivering of accurate information
 Lowers the cost of transmitting documents
 Advantage of being platform independent and easy
to use
 2. Customer Relationship Management
 Customer Relationship Management (CRM) system
 Consists of the processes a company uses to track and
organize its contacts with customers.
 Business and technology discipline for managing
customer relationships to optimize revenue, profitability,
customer satisfaction, and customer retention
 Main goal of a CRM system
 Improve services offered to customers
 Use customer contact information for targeted marketing
 Cont’d
 CRM system helps an organizations to make
better use of data, information, and knowledge
to understand customers
 Gives organizations more complete pictures of
their customers
 Pays external agencies for additional data
about you that might be public or semiprivate
 Advantage of CRM system
Provide services and products that meet
customers’ needs
Offer better customer service through multiple
channels
Increase cross-selling and upselling
Help sales personnel close deals faster by offering
data on customers’ backgrounds
Retain existing customers and attract new ones
 Examples of CRM systems
Sales automation
Order processing
Marketing automation
Customer support
Knowledge management
Personalization technology
End of chapter 2
 Group assignment one
Instruction:
Select any company or firm which has enterprises
systems or collection of soft wares that can be used
by selected organizations as a whole and write detail
note how the enterprise system or collection of soft
ware systems work.
Submission date: On Term paper submission date
Number of students: Maximum five