Chapter Extension 10
Cross-Functional
Systems: CRM, ERP,
and EAI
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Study Questions
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What is the importance of inherent processes?
What are the characteristics of customer relationship
management (CRM) systems?
What are the characteristics of enterprise resource
planning (ERP) systems?
How is an ERP system implemented?
What are the characteristics of enterprise application
integration (EAI) systems?
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Business Process Design
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Business process redesign
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Organizations should not automate or improve
functional systems
Organizations should create new business
processes
Came from idea that information systems
should support linkages across departments
and activities
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Challenges of Business Process
Design
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Projects expensive and difficult
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Systems analysts interview personnel, document existing
systems
Managers review results, develop new process
New information systems developed
Takes time
Underlying systems constantly changing
Employees resist change
Outcome uncertain
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Benefits and Disadvantages of
Inherent Processes
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Business applications
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Processes for using software are inherent
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Benefits
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Integrate activities across departments
Saves time
Saves money
Reduces design process problems
Disadvantages
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Organizations must conform activities to processes
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May have to change substantially
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Organizational Change
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Common problem has produced change
management industry
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Blend of business, engineering, sociology, psychology
Strives to understand dynamics of change
Develop theories, methods, techniques
Employee resistance
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Need to understand rationale for new system
Fear of unknown
Increase employees’ sense of self-efficacy
Bosses’ behavior and communication important
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Customer Relationship
Management Systems (CRM)
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Support processes of attracting, selling, managing,
delivering, and supporting customers
Addresses all activities that touch customers
Single repository for customer data
Customer life cycles
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Marketing sends messages to target market
Prospects order and need to be supported
Support and resale increases value to existing customers
Win-back processes categorize customers according to
value
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Customer Life Cycle
Figure CE10-2
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Components of CRM System
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Solicitation
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Lead-tracking
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Supporting system is email and organization’s Web site
Presale applications turn prospects into customers
Relationship management
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Maximize value of existing customers
Sales management applications help develop strategies for
regaining lost customers
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
CRM Components
Figure CE10-3
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Enterprise Resource Planning
Systems (ERP)
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Support business processes, human resources,
account support processes
Enterprise-wide
Cross-departmental process systems
Based on documented, tested business models
Process blueprint
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Comprehensive set of inherent processes for all business
activities
Formally designed
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Organizations must adapt to blueprint
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Benefits and Problems of ERP
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Benefits
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Processes effective and efficient
Organizations do not need to reinvent processes
Reduce lead time
No data inconsistency problem
Lower costs
Higher profitability
Problems
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Costly
Change is challenging
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Implementing ERP
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Tasks in implementation
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Model current business processes
Compare these to ERP blueprint processes
Eliminate differences
Implement new, revised system
Train users
Difficult, time-consuming
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
ERP Implementation
Figure CE10-9
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Enterprise Application Integration
(EAI) Systems
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Solves problems of isolated systems
Provides layers of software that connect applications
together
Enables existing applications to communicate
Provides integrated information
Leverages existing systems
Enables gradual move to ERP
No centralized database
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Files of metadata describing where data kept
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
EAI Architecture
Figure CE10-8
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke
Active Review
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What is the importance of inherent processes?
What are the characteristics of customer relationship
management (CRM) systems?
What are the characteristics of enterprise resource
planning (ERP) systems?
How is an ERP system implemented?
What are the characteristics of enterprise application
integration (EAI) systems?
© 2006 Prentice Hall, Introduction to MIS: A Modular Approach, David Kroenke