Enterprise Information Systems

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Enterprise Information Systems
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Functional View of Organizations
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Silo Information Systems
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Business Process Definition

• A logical set of related activities taking
  inputs, adding value through doing things, and
  creating an output
• Any set of activities performed by a business
  that is initiated by an event, transforms
  information, materials or business commitments,
  and produces an output.

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Supply Chain Process
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Organizational Value Chains
Organization likely to have multiple value chains
that cut across functional areas. For example, a
bank has residential and commercial loans, each
treated as separate products (value chains) and
each is processed by multiple groups within the
bank.
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Business Process View of Organizations
Business processes cut across functional
areas. Each functional group has its own
information systemswhich are often not
integratedwith those of other functionalgroups.

What problems does this create?
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Problems with Silo based IS

• Multiple databases, so you may have inconsistent
  data and data often must be entered multiple
  times.
• Workflow often involves paper documents and
  inefficiencies such as queuing delays, lost
  documents, etc. often result.
• Processes may be optimized within functional
  areas but remain suboptimal overall.
• Information difficult to retrieve and aggregate
  by upper management.

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Enterprise Information Systems (ES)

• Information technologies that are deployed across
  multiple organizational groups and specify entire
  business processes
• Types of ESs
• Enterprise Resource Planning (ERP)
• Supply Chain Management (SCM)
• Customer Resource Management (CRM)
• e-Procurement
• e-Marketplace

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ESs use Best Practices to Implement Business
Processes

• ERP vendors work with experts from various
  industries to define best practices for that
  industry
• They then create a Business Architecture for the
  industry and define various processes which are
  embodied in the software

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Portion of SAP Telecommunications Business
Architecture
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Portion of the SAP New Car Sales Process
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Business Processes and SAP Modules
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Data Integration
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IT Investments can be Problematic

• 50 of IT initiatives are abandoned altogether
• Another 40 are delivered late and over budget
• 70 failure rates among IT-based change
  initiatives
• 30-60 failure rates among general efforts to
  improve work processes
• Only about 30 of all projects are considered by
  their sponsors to fully successful

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ES Implementation

• Implementing ESs pose greater challenges to
  managers than other projects

Why?
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Challenges of ES

• More groups involved so political issues are more
  important
• Entire processes are impacted so risks are high
• Changes embedded in the system are difficult to
  revisit so development choices must be made
  correctly the first time

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ES Implementation

• Riskiest type of IT investment
• Because scope is so large, ES projects often
  effect the careers of the major players and can
  impact the viability of the organization
• 50 of all corporate IT investment
• Potential reward is high
• ESs can have significant performance improvements
  and can positively affect company valuation

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Number one reason for failure
Managerial Factors!
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Outline for Semester

• Introduction to SAP
• Initial use of SAP
• Business Process Mapping
• Mapping business processes
• SAP exercises
• SAP system landscape
• Implementing ERP
• Simulation