Information Systems
Drivers
Requirements for classes
of applications
IT Drivers
Electronic Commerce
Business to business
Electronic retail
Data Warehousing
Enterprise Management
SAP and others
Supply chain management
Electronic Commerce
Interorganizational
Systems:
Business-to-business
Electronic storefront
Market Exchange
Interorganizational Structure
Vertical integration
Multiple activities in the same firm
Risk: range of expertise required
Selective sourcing
Some outsourced activities
Risk: control of outsourcer
Virtual corporation
Coordination of separate activities
Risk: loss of core competency
Questions
Do we benefit from electronic commerce?
Do we use information to add value to customers?
Are we managing the product/service channel?
Have we redesigned business with our partners to
take advantage of technology and provide security
Do we have partners with shared vision and
common purpose?
Do we have the right infrastructure?
External / Internal Hosting
Outside (Cheaper)
minimize bandwidth and hardware problems
use external experts
installed infrastructure
little additional staffing required
Inside (More Control)
dependent on third party reliability
possible single vendor software solutions
possible single vendor payment scheme
External / Internal Hosting
External better at storefronts
but requires close integration with core
business
Internal better at business to business
but often creates a self-contained replicated
system that can be outsourced
Payment
Credit Cards
SET (Secure Electronic Transaction) with http
Electronic Checks
Public/private key transactions with banks
Electronic Cash
3rd party software to create virtual cash
EDI/EFT
Value added network using 3rd party. Common in
business to business.
Data Warehousing
Building a database to
support the decision
making activities of a
department or business
unit
Data Warehouse
A read-only database for decision analysis
–Subject Oriented
–Integrated
–Time variant
–Nonvolatile
consisting of time stamped operational
and external data.
Data Warehouse
Architecture
Enterprise
Data
Warehouse
Data
Marts
Business
Packages
Two Approaches
Classical Enterprise Database
Typically contains operational data that
integrates information from all areas of
the organization.
Data Mart
Extracted and managerial support data
designed for departmental or EUC
applications
Data Warehouse vs
Operational Databases
Highly tuned
Real time Data
Detailed records
Current values
Accesses small
amounts of data in a
predictable manner
Flexible access
Consistent timing
Summarized as
appropriate
Historical
Access large amounts
of data in unexpected
ways
Access
Tailored access programs in user form,
usually client-server
Specialist interfaces
General purpose GUI products (e.g.
Access, PowerBuilder)
Custom access routines
Strategic Partnerships
Outsourcing, etc.
Outsourcing of IT
Functions
Traditional Outsourcing: removing IT
from a function for a long term (10 years)
Transitional Outsourcing: using outside
services to move to a new environment
over a short term (1-3 years)
Product Acquisition: purchasing
functionality rather than building it
Outsourcing Difficulties
Contracts are structured for long periods
(10 years is normal)
 Early benefits are clear for the customer; late
benefits to the outsource supplier
(When the benefits start building for the outsourcer, the
customer starts wanting change)
 Few outsourcers large enough for big projects
(EDS, CSC, IBM, AT&T)
 Technology evolution changes strategic IT
relevance
Outsourcing in the 1990’s
More than half of all firms are considering
some sort of outsourcing activity
Acceptance of strategic alliances
Win-win alliances in many business areas
IT’s changing environment
Focus on networking and integration places
extraordinary pressures on legacy and state
of the art systems management
Outsourcing Drivers
Management concern for cost and
quality
Breakdown in IT performance
Supplier pressures
Simplified Company management
agenda
Financial Factors
Corporate culture
What Happens
Vendor specialists
Current IT organization
Basic services
Enterprise Resource
Planning
ERP Reality
Complete systems can cost tens of
millions of dollars
Implementation can take several
years
Companies may lose flexibility
SAP
Systems, Applications
and Products in Data
Processing
What is SAP?
SAP is the leading global provider of
client/server business application solutions
SAP is the number one vendor of standard
business applications software
SAP is the fifth largest independent
software supplier in the world
Facts About SAP:
Founded in 1972 in Walldorf, Germany
SAP employs a workforce of over 7,000
SAP has offices in over 40 countries
More than 6,000 companies worldwide
have implemented SAP
Reported revenues for 1995 were 1.887
billion dollars
Infrastructure Drivers