Business Driven
Technology
Unit 1
Achieving Business Success
Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
Unit One
O Chapter 1– Business Driven Technology
O Chapter 2 – Identifying Competitive Advantages
O Chapter 3 – Strategic Initiatives for Implementing
Competitive Advantages
O Chapter 4 – Measuring the Success of Strategic
Initiatives
O Chapter 5– Organizational Structures that Support
Strategic Initiatives
3-2
Chapter 3
Strategic Initiatives for Implementing
Competitive Advantages
3-3
LEARNING OUTCOMES
1. Explain supply chain management and its
role in business
2. Explain customer relationship management
systems and how they can help
organizations understand their customers
3. Summarize the importance of enterprise
resource planning systems
4. Identify how an organization can use
business process reengineering to improve
its business
3-4
Strategic Initiatives
O Organizations can undertake high-
profile strategic initiatives including:
O Business process reengineering (BPR)
O Supply chain management (SCM)
O Customer relationship management
(CRM)
O Enterprise resource planning (ERP)
3-5
Business Process
Reengineering
O Business process – a standardized set of
activities that accomplish a specific task,
such as processing a customer’s order
O Business process reengineering (BPR) –
the analysis and redesign of workflow
within and between enterprises
3-6
Business Process
Reengineering
O Reengineering the
Corporation – book
written by Michael
Hammer and James
Champy that
recommends seven
principles for BPR
3-7
Finding Opportunity Using BPR
O A company can improve
the way it travels the road
by moving from foot to
horse and then horse to
car
O BPR looks at taking a
different path, such as an
airplane which ignore the
road completely
3-8
Finding Opportunity Using BPR
O Progressive Insurance Mobile Claims Process
3-9
Supply Chain Management
O Supply Chain Management
(SCM) – The management of
information flows between and
among activities in a supply
chain to maximize total supply
chain effectiveness and
profitability
3-10
Basics of Supply Chain
O
The supply chain has three main links:
1. Materials flow from suppliers and their “upstream”
suppliers at all levels
2. Transformation of materials into semifinished and
finished products through the organization’s own
production process
3. Distribution of products to customers and their
“downstream” customers at all levels
3-11
Basics of Supply Chain
O Organizations must embrace technologies that
can effectively manage supply chains
3-12
SUPPLY CHAIN
MANAGEMENT
O Five basic supply
chain activities
3-13
SUPPLY CHAIN
MANAGEMENT
Supply Chain Example
3-14
SUPPLY CHAIN
MANAGEMENT
Walmart and Procter & Gamble SCM Example
3-15
SUPPLY CHAIN
MANAGEMENT
O Effective and efficient SCM systems can
enable an organization to
O Decrease the power of its buyers
O Increase its own supplier power
O Increase switching costs to reduce the threat of
substitute products or services
O Create entry barriers thereby reducing the threat of
new entrants
O Increase efficiencies while seeking a competitive
advantage through cost leadership
3-16
SUPPLY CHAIN
MANAGEMENT
Effective and Efficient SCM Systems
Effect on Porter’s Five Forces
3-17
Customer Relationship
Management
O Customer relationship management (CRM)
– involves managing all aspects of a
customer’s relationship with an
organization to increase customer loyalty
and retention and an organization's
profitability
O Many organizations, such as Charles
Schwab and Kaiser Permanente, have
obtained great success through the
implementation of CRM systems
3-18
Customer Relationship
Management
O CRM is not just technology, but a strategy,
process, and business goal that an
organization must embrace on an
enterprisewide level
O CRM can enable an organization to:
O Identify types of customers
O Design individual customer marketing campaigns
O Treat each customer as an individual
O Understand customer buying behaviors
3-19
Customer Relationship
Management
3-20
Evolution of CRM
O CRM reporting technology – Help organizations
identify their customers across other applications
O CRM analysis technologies – Help organization
segment their customers into categories such as best
and worst customers
O CRM predicting technologies – Help organizations
make predictions regarding customer behavior such
as which customers are at risk of leaving
3-21
Evolution of CRM
3-22
Enterprise Resource Planning
O Enterprise resource planning (ERP) – integrates all
departments and functions throughout an organization
into a single IT system so that employees can make
decisions by viewing enterprisewide information on all
business operations
O Keyword in ERP is
“enterprise”
3-23
Enterprise Resource Planning
O Sample data from a sales database
3-24
Enterprise Resource Planning
O Sample data from an accounting database
3-25
Enterprise Resource Planning
O ERP systems collect data from across an organization
and correlates the data generating an enterprisewide
view
3-26
LEARNING OUTCOME REVIEW
O Now that you have finished the
chapter please review the learning
outcomes in your text
3-27