IS 300 Final Exam Study Guide for IS 300 Fall 2023
Chapter
Chapter 14 on AI and I Applications PowerPoint
Technology Guide 3: Cloud
Chapter 11: CRM and Supply Change Management
Chapter 4: Information Security
Chapter 7: E-Business and E-Commerce
Chapter 8: Wireless, Mobile Computing & Mobile
Commerce Technology Guide 2: Software
Zara Case
Approximate
questions
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Technology Guide 2: Software
● Software
○ Computer programs or the instructions given to hardware
● Types of Software
○ Programming
■ The process of writing or coding programs
○ Programmers
■ Individuals who program
○ Open Systems
○ Application Software
■ Consists of instructions that direct a computer system to perform
specific information- processes activities and also to provide
functionality for users.
● Package or software suite (microsoft office)
● Personal application software
○ Examples
■ Spreadsheets, word processing, desktop
publishing, data management, presentation,
graphics, personal information management,
personal finance, web authoring, communications
● Speech-recognition software
● Voice-recognition software
○ Open source software
○ Proprietary Software (Software License required)
○ System software
■ Is a set of instructions that serves primarily as an intermediary between
computer hardware and application programs
■ Social interface
● Guides the user through computer applications by using
cartoon-like characters, graphics, animation, and voice
commands. One cartoon like example can be an avatar
■ Mother control gaming consoles
● Another type of human-computer interface
● Examples: The Xbox 360 kinect, the PS3 Playstation move, and
the nintendo wii
Technology Guide 3:
● What is Cloud Computing? Review short video inside PowerPoint Slides.
○ Cloud computing is the on-demand delivery of computer power, database
storage, applications, and other IT resources through cloud services platforms
via the internet with pay-as-you-go pricing.
○ Grid computing
■ Is the practice of leveraging multiple computers,often geographically
distributed but connected by networks, to work together to accomplish
joint tasks. It is typically run on a “data grid,” a set of computers that
directly interact with each other to coordinate jobs
● Textbook example
○ Oxford (United Kingdom) University digital mammogram
national database project
○ Organizations can use the cloud in several different ways. By far most popular,
is to obtain cloud services from cloud service vendors (SaaS)
○ Advantages and benefits
■ Trade capital expense for variable expense
■ Benefit from massive economies of scale
● Average cost decreases as size of operation increases major
cloud vendors operate enormous web farms
■ Stop guessing capacity
■ Increase speed and agility (development time from months-weeks to
days)
■ Stop spending money on running and maintaining data centers
■ Go global in minutes
○ Benefits provided to organizations by web services
■ The organization can utilize the existing internet infrastructure without
having to implement any new technologies
■ Organizational personnel can access remote or local data without
having to understand the complexities of this process
■ The organization can create new applications quickly and easily
○ Six categories of cloud computing concerns
■ Legacy IT systems
■ Reliability
● Amazon web services
■ Privacy
■ The regulatory and legal environment
■ Criminal use of cloud computing
● Cloud characteristics and terms, for example: elastic/ Adding Grid computing just in
case
○ Cloud characteristics
■ Cloud computing follows client-server computing architecture
■ Scalability is high
■ Cloud computing is more flexible than grid computing.
■ Cloud operates as a centralized management systems
■ In cloud computing, cloud servers are owned by infrastructure providers
■ Cloud computing uses services like laas, PaaS, SaaS.
■ Cloud Computing is service-oriented
○ Grid computing
■
■
■
■
■
■
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Grid computing follows a distributed computing architecture
Scalability is normal
Grid computing is less flexible than cloud computing
Grid operates as a decentralized management system
In grid computing, grids are owned and managed by the organization
Grid computing uses systems like distributed computing, distributed
information, and distributed pervasive
■ Grid computing is application-oriented
Different types of clouds
○ Private (Corporate cloud)
■ Single organization. The private cloud owner is responsible for the
infrastructure, software, and security of the service. Users can access
the private cloud resources through a private network or the internet. A
private cloud can be hosted on-premises or off-premises by a third-party
provider
○ Public
■ A public cloud is a cloud service that is delivered via the internet and
shared by multiple users or organizations. The public cloud provider
owns and manages the infrastructure, software, and security of the
service.
○ Hybrid
■ Is a cloud service that combines both public and private clouds. The
hybrid cloud allows users to move data and applications between the
two environments based on their needs and preferences
○ Vertical
Cloud Computing services - know what they provide, and which one provides the least
to the most for a company. For instance, if you were starting a new business and
wanted most of your IT covered by Cloud services, which platform would you choose?
○ IaaS (Infrastructure as a service)
■ It is a service model where you can rent computing resources, such as
servers, storage, networks, and virtual machines, from a cloud provider.
You have more control and flexibility over the configuration and
management of these resources. You are responsible for the operating
system, middleware, applications, and data. Some examples of laaS are
Amazon EC2, Google computer engine, and Microsoft azure virtual
machines.
○ PaaS (Platform as a service)
■ It is a service model where you can develop, deploy, and run
applications using tools and frameworks that are provided by a cloud
provider. You don’t have to manage the underlying infrastructure, such
as servers, storage, or networks. You only have to focus on the
application code and data. Some examples of PaaS are google app
engine, microsoft azure app services, and amazon s3.
○ SaaS (Software as a service)
■ It is a service model where you can use software applications that are
hosted and managed by a cloud provider. You don’t have to install,
update, or maintain the software yourself. You just need an internet
connection and a web browser to access the software. Some examples
of SaaS are Gmail, Netflix, and Spotify.
Private clouds (intranet)
Advantages of cloud versus advantages of in-house hosting.
Chapter 14 Artificial Intelligence (AI) and PowerPoint of AI Applications
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Sebastian Thrun (From Google)and Chris Anderson: What AI is-- and isn't |
TED Talk,
○ Review AI applications discussed
○ Crowdsourcing
○ and the overall opinion of the speaker.
Sam Harris – can we build an AI without losing control over it?
xOverall opinion and his recommendation of what we may do to address
AI.
Classification by Intelligence:
○ Narrow AI
■ Examples of Narrow AI
○ General AI
Classification by Task:
○ Prediction and Examples
○ Optimization and Examples
○ Anomaly detection and Examples
○ Creativity: and Examples
Classification by Task (Functionality):
○ Reactive machines and Examples
○ Limited memory machines and Examples
○ Theory of mind machines and Examples
○ Self-aware machines and Examples
Classifying by Degree of Autonomy
○ Fully autonomous AI and Examples
○ Partially autonomous AI and Examples
Open AI
○ Originally started as a nonprofit, and still governed as one, OpenAI’s stated
mission is to safely build AI that is “generally smarter than humans”
○ Background and vision
○ ChatGPT, Bard, etc.
○ Prompts
○ Hallucinations
General topics:
○ What is AI
■ The theory and development of the information systems able to perform
tasks that normally require human intelligence
○ Expert Systems
■ Computing systems that attempt to mimic human experts by applying
expertise in a specific domain. Expert systems can either support
decision makers or completely replace them.
■ Difficulties of using expert systems
● Transferring domain expertise from human experts to the expert
system can be difficult because people cannot always explain
what they know
● Even if the domain experts can explain their entire reasoning
process, automating that process may not be possible
● In some contexts, there is a potential liability from the use of
expert systems
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○
○
○
Deep learning
■ Is a subset of machine learning in which the system discovers new
patterns without being exposed to labeled historical or training data.
■ Examples
● Speech recognition
● Image recognition
● Natural language processing
● Drug discovery and toxicology
● Customer relationship management
Neural networks
■ A set of virtual neurons or central processing units (CPUs) that work in
parallel in an attempt to simulate the way the human brain works,
although in a greatly simplified form
Machine learning
■ The ability to accurately perform new, unseen tasks, built on known
properties learned from training or historical data that are labeled
■ Examples
● Banking industry
● The oil and gas industry
● The life sciences industry
● Retail industry
What AI is in use today, for example, natural language processing, and
Computer vision.
■ Computer vision
● Computer vision has diverse applications
○ Medical imaging
○ Facial recognition
○ Shopping
○ Self-driving cars
○ Pinterest
○ Google photo app
○ Microsoft’s traffic prediction project
■ Natural language processing
■ Robotics
■ Speech recognition
■ Intelligent Agents
● Software programs that imitate humans and perform tasks on
command
● The agent uses a limited built-in or learned knowledge base
● Accomplish tasks or make decisions on the user’s behalf, e.g.
routing calls in a call center
● A software program that assists you, or acts on your behalf, in
performing repetitive computer-related tasks.
● Information agents
○ Search for information and display it to users. The best
known information agents are buyer agents. A buyer
agent, also called a shopping bot, helps customers find
the products and services they need on a website.
● Monitoring-and-surveillance agents-predictive agents
○ Constantly observe and report on some item of interest
●
User agents (personal agents)
○ Take action on your behalf
○ AI Examples covered in class.
○ AI videos were presented during the AI applications supplemental slides.
Crisper video (What has already been accomplished) and Video on 2030, what
are some new AI applications.
Chapter 4: Security
● Added in from slides: Five factors contributing to vulnerability
○ Today’s interconnected, interdependent, wirelessly networked business
environment
○ Smaller, faster, cheaper computers and storage devices
○ Decreasing skills necessary to be a computer hacker
○ International organized crime taking over cybercrime
○ Lack of management support
● Added in from slides: Social engineering
○ An attack in which the perpetrator uses social skills to trick or manipulate
legitimate employees into providing confidential company information such as
passwords
○ Example
■ Kevin mitnick, world famous hacker and former FBI’s most wanted
● Unintentional Threats
○ Human Errors
■ Higher level employees+ greater access privileges= greater threat
■ Two areas pose significant threats
● Human resources and information systems
■ Other areas of threats
● Contract labor, consultants, janitors, and guards
■ Common human error
● Carelessness with laptops
● Carelessness with computing devices
● Opening questionable email
● Careless internet surfing
● Poor password selection and use
● Carelessness with one’s office
● Carelessness using unmanaged devices
● Carelessness with discarded equipment
● Careless monitoring of environmental hazards
○ Social Engineering
● Deliberate Threats
○ Espionage or trespass
○ Information extortion
○ Sabotage or vandalism
○ Theft of equipment or information
○ Identity theft
○ Compromises to intellectual property
○ Software attacks
■ Remote attacks requiring user action
● Virus, worm, phishing attack, spear phishing attack
■ Remote attacks needing no user action
● Denial of service attack, distributed denial of service attack
■ Attacks by a programmer developing a system
● Trojan horse, back door, logic bomb
○ Alien software
■ Adware
■ Spyware
● Keyloggers
■ Spamware
■ Cookies
● Tracking cookies
○ Supervisory control and data acquisition (SCADA) attacks
○ Cyberterrorism and cyberwarfare
● Risk limitation Strategy
○ Physical controls
■ Prevent unauthorized individuals from gaining access to a company’s
facilities
● Walls, doors, fencing, gates, locks, badges, guards, alarm
systems
○ Authentication
■ Something the user is (biometrics)
■ Something the user has- id cards
■ Something the user does - signature
■ Something the user knows- passwords
○ Active methods
■ Requires users to physically participate
● Facial recognition
● Voice recognition
● Retinal scanning
● Iris scanning
● Newer methods: DNA and gait recognition
○ Passive methods
■ Can identity person without active participation
● Voice recognition, example bank will hear the voice and identify
the customer
● Behavioral recognition
● Added in from slides: Virtual private network (VPN)
○ VPN and tunneling: Describes the opportunity to establish a protected network
connection when using public networks. VPNS encrypt your internet traffic and
disguise your online identity. This makes it more difficult for third parties to track
your activities online and steal data. The encryption takes place in real time
● Information Security controls
● Software to protect computer
● Ways to protect your data: Encryption
● Communication Control: Whitelisting
Chapter 7 E-Business and E-commerce (PowerPoint and lecture notes are sufficient for
this chapter)
1. Types of e-Commerce
a. The process of buying, selling, transferring, or exchanging products, services,
or information via computer networks, including the internet.
b. Business-to-consumer(B2C)
i.
Applies to any business that sells its products or services directly to
consumers online.
ii.
Three ways to operate
1. Brick-and-mortar business(trader joes)
2. Click-and-mortar business (barnes and noble)
3. Pure-play (virtual) business (google)
iii.
Electronic storefront
1. A website that represents a single store
iv.
Electronic mall
1. (Also known as a cybermall or an e-mail) a collection of
individual shops consolidated under one internet address and
they are closely associated with B2C electronic commerce
v.
Electronic marketplace (e-marketplace)
1. A central, virtual market space on the web where many buyers
and many sellers can conduct e-commerce and e-business
activities (amazon, bing.com/shopping)
vi.
Online service industry
1. Cyber banking (electronic banking)
a. Involves conducting various banking activities from home,
at a place of business, or on the road instead of at a
physical bank location. It includes capabilities rankings
from paying bills to applying for a loan
2. Online securities trading: example www.schwab.com/tradiing
a. The use of computers to trade stocks, bonds, and other
financial instruments which is cheaper than a full service
or discount broker
3. Online job market
a. Companies and government agencies advertise available
positions, accept resumes, and take applications via the
internet while job seekers use the online job market to
reply online to employment ads, to place resumes on
various sites,and to use recruiting firms
4. Disintermediation
a. A process whereby intermediaries are eliminated.
i.
It is the removal of intermediaries such as
distributors or brokers
5. Reintermediation
a. The creation of new intermediaries between customers
and suppliers providing services such as supplier search
and product evolution
c. Business-to-business(B2B)
i.
Sell-side marketplaces
1. Organizations sell their products to other organizations
electronically from their own private e-marketplace or 3rd party
a. Key mechanisms for sell-side marketplace: forward
auctions, electronic catalogs and third-party auction
ii.
Buy-Side Marketplaces-Uses EC technology to streamline
iii.
procurement.
iv.
Buy-Side MarketplacesModel
1. Procurement
2. Purchasing
3. Reverse Auction
4. E-procurement
5. Group Purchasing
v.
Electronic Exchanges
1. Could be private or public – see next slide
vi.
Public Exchanges
1. Electronic marketplaces that are independently owned by a third
party, and they connect many sellers with many buyers which
are open to all business organizations and frequently owned and
operated by a third party.
2. Vertical exchanges
a. Connect buyers and sellers in a given industry
3. Horizontal exchanges
a. Connect buyers and sellers across many industries
4. Functional exchanges
a. Needed services such as temporary help/labor or extra
office space are traded on “as-needed: basis
vii.
Private Exchanges
1. have one buyer and many sellers.
d. Consumer-to-consumer(C2C)
e. Business-to-employee(B2E)
f. E-Government – G2C, G2G and C2G
g. Consumer-to-consumer (C2C)
h. Consumer to Business (C2B)
i. Mobile commerce (M-commerce)
2. E-Commerce Business Models
a. A much broader concept than e-commerce. Servicing customers, collaborating
with business partners, and performing electronic transactions within an
organization
i.
Business model
1. Set of planned activities designed to result in a profit in a
marketplace
2. 9 elements of a business model
a. Value proposition
i.
Why should the customer buy from you?
ii.
Successful e-commerce value propositions
1. Personalization/customization
2. Reduction of product search, price
discovery costs
3. Facilitation of transactions by managing
product delivery
4. Example: Uber
b. revenue model
i.
How will you earn money?
ii.
Major types of revenue models
1. Advertising revenue model
2. Subscription revenue model
a. Freemium strategy
3. Transaction fee revenue model (ebay)
4. Sales revenue model (gap.com)
5. Affiliate revenue model
6. Combination of the above example: sales
revenue and subscription revenue model
c. Market opportunity
i.
“What marketspace do you intend to serve and
what is its size?
1. Marketspace: area of actual or potential
commercial value in which company
intends to operate
2. Realistic market opportunity: defined by
revenue potential in each market niche in
which company hopes to compete
ii.
Market opportunity typically divided into smaller
niches
d. competitive environment
i.
Who else occupies your intended marketspace
1. Other companies selling similar products
in the same marketspace
2. Includes both direct and indirect
competitors
ii.
Influenced by:
1. Number and size of active competitors
2. Each competitor’s market share
3. Competitors’ profitability
4. Competitors' pricing
e. competitive advantage
i.
What special advantages does your firm bring to
the marketspace?
1. Is your product superior to or cheaper to
produce than your competitors?
ii.
Important concepts
1. Asymmetries-exist whenever one
participant in a market has more resources
than other participants
2. First-mover advantage- a competitive
market advantage for a firm that results
from being the first into a marketplace with
a service or product
3. Complementary resources- resources and
assets not directly involved in the
production of the product but required for
success such as marketing, management
financial assets and reputation
4. Unfair competitive advantage occurs one
firms develops an advantage based on a
factor that other firms cannot obtain
5. Leverage- when a company uses its
competitive advantage to achieve more
advantage in surrounding markets
6. Perfect market: a market in which buyers
and sellers have complete information
about a particular product and it is a easy
to compare prices of products because
they are the same as each other etc. a
market in which there are no competitive
advantages or asymmetries because all
firms have equal access to all factors of
production
f. market strategy
i.
How do you plan to promote your products or
services to attract your target audience?
1. Details how a company intends to enter
market and attract customers
ii.
Best business concepts will fail if not properly
marketed to potential customers
g. organizational development
i.
What types of organizational structures within the
firm are necessary to carry out the business plan?
ii.
Describes how firm will organize work
1. Typically, divided into functional
departments
2. As company grows, hiring moves from
generalist to specialists
h. management team
i.
What kind of backgrounds should the company’s
leaders have?
ii.
A strong management team
1. Can make the business model work
2. Can give credibility to outside investors
3. Has market-specific knowledge
4. Has experience in implementing business
plans
i. raising capitals
i.
Seed capital- Seed capital is provided during the
earliest stage of the company’s formation, during
the period of time when the company is involved
in a variety of early operations such as market
research, product development, or prototype
production.
ii.
Traditional sources
1. Incubators- an incubator firm is an
organization engaged in the business of
fostering early-stage companies through
the development phases until the
companies have sufficient financial,
human resources, and physical resources
to function on their own.
iii.
Commercial banks
iv.
Angel investors video
1. Venture capital firms is a type of financing
by venture capital. It is private equity
capital provided as seed funding to
early-stage, high-potential, growth
companies(startup companies) or more
often it is after the seed funding round as a
growth funding round (also referred to as
v.
series A round)
2. Strategic partners- usually refers to a
corporate investor. For example, if
company X invests money in your
company, they are a strategic investor.
They usually invest so they can potentially
acquire the company at a later date
Crowdfunding
1. Jobs act
Government loans
vi.
Business plans
1. Describes a firm’s business model
iii.
E-commerce business model
1. Details how a company creates, delivers, and generates revive
on the internet
b. Online direct marketing
c. Electronic tendering system (uses B2B with Reverse auction
d. Name-your-own-price
e. Find-the-best-price
f. Affiliate marketing
g. Viral marketing
h. Group purchasing (e-coops
i. Online Auctions
j. Product customization
k. Electronic marketplaces – See slide 17
l. Bartering online
m. Deep discounters
n. Membership
3. Electronic storefronts, marketplace, mall, and auction
4. Buy-side marketplace and sell-side marketplace
a. Sell-side marketplaces
i.
Organizations sell their products to other organizations electronically
from their own private e-marketplace or 3rd party
1. Key mechanisms for sell-side marketplace: forward auctions,
electronic catalogs and third-party auction
b. Buy-Side Marketplaces-Uses EC technology to streamline
c. procurement.
d. Buy-Side MarketplacesModel
i.
Procurement
ii.
Purchasing
iii.
Reverse Auction
iv.
E-procurement
v.
Group Purchasing
ii.
E-commerce – Business model part 2 of the PowerPoint slides is not on the exam.
Chapter 8: Wireless, Mobile Computing & Mobile Commerce
● Internet of things
● Wireless Media- Basic knowledge, pros, and cons, which are inexpensive, which
are Short range wireless; (Broadcast media)
○ Transmit signals without wires
○ Three major advantages for users
●
■ Small enough to easily carry or wear
■ Sufficient computing power to perform productive tasks
■ Communicate wirelessly with the internet and other devices
○ One major disadvantage for business
■ Workers can capture and transmit sensitive proprietary information
Types of Transmissions:
○ Microwave
■ Advantages
● High bandwidth
● Relatively inexpensive
■ Disadvantages
● Requires an unobstructed line of sight
● Susceptible to environmental interference
○ Satellite
■ Advantages
● High bandwidth
● Large coverage area
■ Disadvantages
● Expensive
● Requires unobstructed line of sight
● Signals experience propagation delay
● Requires the use of encryption for security
○ Communications Satellites-General Concepts
■ GEO
● Orbit: 22,300 miles
● Number of satellites: 8
● Use: TV Signal
● Characteristics:
○ Satellites stationary relative to point on Earth
○ Few satellites needed for global coverage
○ Transmission delay (approximately .25 second)
○ Most expensive to build and launch
○ Longest orbital life (many years)
● Advantages
○ Provides internet services to remote areas of Earth
● Disadvantages
○ Propagation delay
○ Disrupted by environmental conditions
■ MEO
● Orbit: 6,434 milers
● Number of satellites: 10-12
● Use: Global positioning systems (GPS)
○ A wireless system that utilizes satellites to enable users
to determine their position anywhere on Earth
○ Supported by 24 MEO satellites
○ Use of GPS
■ Navigating, mapping, surveying, 911 location
○ Three additional GPS systems
■ Glonass, Russia 2005
■ Galileo, european union 2015
■ Beidou, china 2020
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■
○
●
●
●
LEO
●
●
●
●
Characteristics:
○ Satellites move relative to point on earth
○ Moderate number needed for global coverage
○ Requires medium-powered transmitters
○ Negligible transmission delay
○ Less expensive to build and launch
○ Moderate orbital life(6-12 years)
Orbit: 400-700 miles
Number of satellites: many
Use: telephone, internet
Characteristics:
○ Satellites move rapidly relative to point on earth
○ Large number needed for global coverage
○ Requires only low-power transmitters
○ Negligible transmission delay
○ Least expensive to build and launch
○ Shortest orbital life (as low a 5 years)
Radio
■ Advantages
● High bandwidth
● Signals pass through walls
● Inexpensive and easy to install
■ Disadvantages
● Creates electrical interference problems
● Susceptible to snooping unless encrypted
○ Bluetooth
Examples of wireless:
○ Medium range wireless networks
■ Wireless fidelity (Wi-fi)
● Wireless local area networks (WLAN)
● Wi-fi direct
● MiFi
● Super wifi
○ Telemetry
○ The internet of Things
○ RFID Tags (Active/Passive)
Dematerialization
○ A phenomenon that occurs when the functions of many physical devices are
included in one other physical device. Consider that your smartphone includes
the functions of digital cameras for images and videos, radios, televisions,
internet access via web browsers, recording studios, editing suites, movie
theaters, gps navigators, word processors, credit card swipers, magnifying
glasses, Wi-fi, e-mail access, text messaging, a full QWERTY keyboard, and
many, many others
Added it because it was in the slides
○ Mobile computing
■ Two major characteristics
● Mobility
● Broad reach
■ Mobility and broad reach create 5 value-added attributes
○
○
○
● Ubiquity
● Convenience
● Instant connectivity
● Personalization
● Localization of products and services
Mobile commerce
■ Drivers of m-commerce
● Widespread availability of mobile devices
● Declining prices
● Bandwidth improvement
■ Mobile commerce applications include
● Location-based applications and services
● Financial services
● Intra Business applications
● Accessing information
● Telemetry applications
The internet of things (IOT)
■ Is the network of physical objects-devices, vehicles, buildings and other
items- embedded with electronics, software, sensors, and network
connectivity that enables these objects to collect and exchange data.
The internet of things gives us access to the data from millions of
devices. But how does it work, and what can we do with all that data?
Internet of everything (IOE)
■ IoE is an extension of IoT and is a term that refers to consumer products
and devices that connect to the internet and have expanded digital
features. It is an entire ecosystem where everything is interconnected.
Thus, IoE is a wider concept that includes not only machine-to-machine
communication (M2M) but also people to machine (P2M) and people to
people (P2P) communication through technology. While the M2M
connection is always important, IoE places emphasis on the other two
types of communication.
■ Examples:
● Coke machines
● A heart monitor implant
● A farm animal with a biochip transmitter
● An automobile tire pressure
● Bike helmet crash sensor
Chapter 11: CRM and SCM
● CRM
○ Suite Of applications, database, and set of inherent processes. It is Customer
Centric.
○ Manage all interactions with customers through four phases of the customer life
cycle.
■ Marketing, Customer acquisition, Relationship management,
Loss/Churn
○ Example: Chatter, by Salesforce.com, to connect employees, customer.
○ Customer Touch Points
■ Traditional: Telephone, direct mailing, and physical interactions.
■ Organizational CRM systems such as e-mail, Web sites, and
communications via smartphones
○
●
●
●
CRM Further Look
■ Lifetime value
■ Customer Churn
■ CRM Strategy versus CRM systems
■ Low-end CRM Systems versus High-end CRM Systems
○ Analytical CRM systems
■ Analytical CRM systems analyze customer data for a variety of
purposes
● Provide business intelligence by analyzing customer behavior
and perceptions providing information concerning customer
requests and transactions, as well as customer responses to the
organization’;s marketing, sales, and service initiatives. These
systems also create statistical models of customer behavior and
the value of customer relationships over time, as well as
forecasts about acquiring, retaining, and losing customers.
CRM Vendors
Types of CRM Systems for example Social and on-demand
○ On-demand CRM systems
■ Systems hosted by an external vendor in the vendor’s data center which
spares the organization the costs associated with purchasing the
system, maintenance, and employees need to know only how to access
and utilize it. Also known as utility computing or software-as-a-service
(SaaS)
○ Mobile CRM Systems
■ An interactive system that enables an organization to conduct
communications related to sales, marketing, and customer service
activities through a mobile medium for the purpose of building and
maintaining relationships with its customers.
○ Open-source CRM systems
■ The source code for open-source software is available at no cost
○ Social CRM Systems
■ The use of social media technology and services to enable
organizations to engage their customers in a collaborative conversation
in order to provide mutually beneficial value in a trusted and transparent
manner.
○ Real-time CRM
■ Organizations are able to respond to customer product searches,
requests, complaints, comments, ratings, reviews, and
recommendations in near real-time, 24/7/365
Operational CRM systems- get detail
○ Support Front-office business processes.
■ Front-office processes:
● Those processes that directly interact with customers (I.e., sales,
marketing, and service)
○ Customer-Facing
■ Applications-allow an organization’s sales, field service, and customer
interaction center representatives interact directly with customers
through customer service and support, sales force automation,
marketing, and campaign management
■ Sales Force automation:
● The component of an operational CRM system that automatically
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●
records all of the components in a sales transaction process.
● Contact management system
● Sales lead tracking system
● Sales forecasting system
● Product knowledge system
● Configurators
○ Customer-touching applications:( Electronic CRM/e-CRM)
■ Customer self-help applications/technologies
○ Analytical CRM systems
■ Analyze customer data for a variety of purposes. Provides business
intelligence.
○ Benefits
■ Efficient, personalized marketing, sales, and service
■ A 360-degree view of each customer
■ The ability of sales and service employees to access a complete history
of customer interaction with the organization, regardless of the touch
point
○ Customer service and support
■ Allow an organization’s sales, field service, and customer interaction
center representatives interact directly with customers through customer
service and support, sales force automation, marketing, and campaign
management
Marketing – upselling, cross-selling bundling, etc.
○ CRM marketing applications use data mining to sift through volumes of
customer data
○ Campaign management
■ Applications that help organizations plan campaigns that send the right
messages to the right people through the right channels (e.g., avoid
targeting people who have opted out of receiving marketing…..)
○ Customer Service and support
■ Customer interaction centers (CIC)
● Call centers, outbound telesales, inbound teleservice
○ Cross selling
○ Up selling
○ Bundling
○ Customer-touching applications (Deals with technologies not representatives)
■ Search and comparison capabilities
■ Technical and other information and services
■ Customized products and services
■ Personalized web pages
■ FAQs
■ Email and automated response
■ Loyalty programs
SCM- Segments – 3 of them
○ Supply chain
■ The flow of materials, information, money, and services from raw
material suppliers, through factories and warehouses, to the end
customers.
○ Three segments
■ Upstream
● Where sourcing or procurement from external suppliers occurs
■
●
Internals
● Where packaging, assembly ,or manufacturing takes place
■ Downstream
● Where distribution takes place, frequently by external distributors
○ Problems along the supply chain
■ Two main sources of problems
● Uncertainties
● The need to coordinate multiple activities, internal units, and
business partners
■ Demand forecast
■ Bullwhip effect
● The unexpected Distortion of the supply chain caused by
repetitive variation in demand the unplanned demand from
retailer oscillates back to the distributor and finally to the supplier
magnifying through each level of the supply chain
○ Solutions to supply chain problems using inventories
■ Just-in time (JIT) (Work in progress)
■ Information sharing facilitated by EDI, Extranets
■ Vendor-managed inventory (VMI)
■ Vertical integration
● A business strategy in which a company purchases its upstream
suppliers to ensure that its essential supplies are available as
soon as the company needs them
○ Electronic data interchange (EDI)
■ A communication standard that enables business partners to exchange
routine documents, such as purchasing orders, electronically. EDI
formats these documents according to agreed-upon standards (e.g.,
data formats). It then transmits messages over the Internet using a
converter, called translator
■ Benefits
● Minimizes data entry errors
● Length of the message can be shorter
● Messages are secured
● Reduces cycle time
● Increases productivity
● Enhances customer service
● Minimizes paper usage and storage
■ Disadvantages
● Business processes sometimes must be restructured to fit EDI
requirements
● Many EDI standards in use today
○ Extranets
■ Link business partners over the internet by providing them access to
certain areas of each other’s corporate intranets
■ Virtual private network (VPN)
■ A company and its dealers, customers, or suppliers
■ An industry’s extranet
■ Joint ventures and other business partnerships
Components of SCM, for example, Make, deliver, etc.
○ Tiers of suppliers
■ A supplier may have one or more sub suppliers, a sub supplier may
●
●
●
have its own sub supplier(s), and so on.
○ The flows in the supply chain
■ Materials flows
■ Information flows
■ Financial flows
○ Five components of supply chain management
■ Plan
■ Source
■ Make
■ Deliver (Logistics)
■ Return
○ Push mode
■ Make to stock
○ Pull model
■ Make to order
Types of SCM systems: For example JIT, Vendor managed, etc.
In the PowerPoint, slides - a short video on the bullwhip effect. Pay close attention to
the Puzzle with causes and what can be done. -> These are in order and they go in a
circle from top to bottom then back to the top.
○ Price fluctuation
■ Everyday low prices
○ Order batching
■ Frequent Ordering
○ Forecast Inaccuracy
■ Information sharing
○ Shortage Gaming
■ Forecast on sales history
Extra idk if in test: Portal and exchanges
○ Two basic types of corporate portals
■ Procurement portals
● For a company’s suppliers’s (upstream in the supply chain) this
type of of portal automates the business processes involved in
purchasing or procuring products between a single buyer and
multiple suppliers
■ Distribution portals
● For a company's customers (downstream in the supply chain)
automate the business processes involved in selling or
distributing products from a single supplier to multiple buyers
Zara Case
●
General information
○ This case highlights how Zara’s parent company Inditex leveraged a
technology-enabled strategy to become the world’s largest fashion retailer.
○ Zara is the game-changing clothes giant in the multibrand empire of Inditex
corporation.
○ Uses a blend of technology-enabled strategy.
■ Firm does not use (limited) advertising and rarely runs sales
○ Design- don’t guess, gather data- make small batches of what customers want
●
●
●
and ship it fast!
■ Zara’s store managers are armed with customer apps on mobile devices
(initially windows pdas (personal digital assistant), now touch-screen
ipods).
● Use to gather customer input and feedback
■ Point-of-sale-system(POS)
● Transaction processing system that captures customer purchase
information
○ Shows how garments rank by sales
■ Managers use the information gathered from these systems to make
decisions more quickly and accurately.
■ Customer demand and sales data dictate the designs that zara
develops
■ Inditex employs over 700 designers
■ Garments arrive in stores twice a week
■ They produce small batches.
effect on customers from their limited runs
○ Allows the firm to cultivate the exclusively on its offerings
○ Encourages customers to buy right away and at full price
○ Encourages customers to visit often
○ Reduces the rate of failed product introductions
Zara’s inventory
○ Zara’s inventory is smart
■ Security tags are custom made to also include RFID-technology. RFID
(radio frequency identification): small chip-based tags that wirelessly
emit a unique identifying code for the individual item,
■ Since the entire supply chain is under Zara control and all items flow
through its warehouses, Zara can affix tags to all products before
sending them out to stores
■ RFID lets Zara know where products are, so if a customer asks for an
item in a store, staff using custom apps on an iPad touch can
immediately tell if a product is in store, in a nearby store, or if it can be
ordered from the distribution center or zara.com.
■ RFID tags also allow Zara staff to take in-store inventory four times as
often as pre-RFID rate, with greater accuracy, and using one forth the
staff
e-commerce strategy
○ Digital stores
■ Scanning Items: The fact that you can, as easily as taking a selfie, scan
any item’s code in-store to check size and color availability in the store,
online, or within your area, has changed my shopping game forever. No
more waiting eternally until a store assistant is free to ask for a size, just
to listen “we only have what’s outside, honey”. This goes beyond the
typical retailer e-commerce app, to deliver a completely personalized
experience to any customer, whenever and wherever they may be.
■ • Click & Go: If you don’t feel like going to your nearest Zara, you can
switch to Store Mode to only see that store’s real-time stock, which you
can purchase and collect within 30 minutes through a QR code.
■ • Click & Find: If you are still unsure about the item, you can also get an
in-store guide to exactly where the item is located. No more fretting to
explain to a very busy store assistant the shade of cream of the dress
●
you saw your favorite influencer wearing yesterday.
■ • Click & Try: Book a Room to try on clothes
■ • Digital Receipts: With all this digitalization, it only seems right that Zara
adds an option to have all your receipts stored digitally in-app, speeding
checkout lines and reducing paper use.
○ Inditex sees e-commerce as a critical part of the firm’s omni channel strategy,
which blends online and offline sales in ways that best benefit the customer
○ Omni-channel e commerce
■ Approach to retail that offers consumers an integrated and
complementary set of shop, sales, and return experiences.
■ The company sees the link between online and off-line sales as being
so fluid, it doesn’t even breakout online sales as a separate category
■ One-third of online orders are scheduled for in-store pickup
■ A review of fashion e-commerce apps rated zara’s offering as
best-in-class
○ Inditex open platform IT
■ The basis of this entire integration system is the technological platform
called inditex open platform (IOP), a true digital reproduction in a hybrid
cloud of each of the phases of Inditex’s business model. A virtual
building adapted to each department and its needs, which integrates the
entire life cycle of the product, allowing a permanent interaction and
adaptation between all of them
■ All this complex architecture is developed by multidisciplinary internal
teams to solve the needs of e-commerce and its flexible adaptation to
each of the areas
■ IOP is 90% implemented and will be fully deployed by the end of 2021
logistics -general, for example, location
○ Overview of manufacturing and logistics
■ Highly vertically integrated
● Most of its production process is in-house
■ Distribution- has 10 logistics centers in spain, close to the headquarters
of 8 brands
■ Employs latest technology and advanced software
■ Build and manage new logistic center in compliance with the most
demanding international sustainability centers
■ Incorporate new products into our physical and online stores twice a
week and have the ability to deliver anywhere in the world in a
maximum of 48 hours. Our logistics are characterized by flexibility,
efficiency, and a high responsiveness
■ Contract manufacturing
● Outsourcing production to third-party firms. Firms that use
contact manufacturers do not own plants or directly employ the
workers who produce the requested goods
○ Advantages- lower costs and increased profits
○ Disadvantages- sweatshop labor, poor working
conditions, and environmental abuse
■ Firms face legal action, brand damage, reduced
sales,and decreased appeal among prospective
employees
■ Tech for good: the fair factories clearinghouse
● Sweatshop labor and dismal industry practices has plagued the
●
clothing industry for years
○ Even well-meaning firms can find themselves stung by
corner-cutting partners that hide practices from auditors
or truck products in from unmonitored off-site locations
○ The results can be tragic for those exploited and can
carry lasting negative effects for the firm
● Reebok was essential to creating the nonprofit organization fair
factories clearinghouse.
○ Fair factories clearinghouse (fairfactories.org) provides
systems where apparel and other industries can share
audit information on contract manufacturers
○ Fair factories system carries a record of misdeeds,
notifying all members to avoid violating firms
● Zara concepts go from idea to stores in fifteen days on average
● To achieve this high level of responsiveness, zara uses:
○ A combination of vertical integration and
technology-orchestrated coordination of suppliers
■ Vertical integration: when a single firm owns
several layers in its value chain
○ Just in time manufacturing
○ Finely tuned logistics
● The majority of Zara's merchandise is produced in-house, with
an eye on leveraging technology in areas that speed up complex
tasks, lower cycle time, and reduce error.
● Inventory optimization models determine how many of which
items in which sizes should be delivered to each specific store
■ Logistics
● Coordinating and enabling the flow of goods, people.
Information, and other resources among locations
What makes Zara unique in their industry?
○ Limitations of Zara
■ Operations vulnerabilities- by moving all delivers through just two
locations, the firm is vulnerable to disruptions in the region
● Operations
○ Organizational activities that are required to produce
goods or services
■ Financial vulnerabilities-susceptible to currency fluctuations since
development and manufacturing occur in one country
■ Rising transportation costs
○ Zara’s value chain is difficult to copy
■ But it is not invulnerable, nor is future dominance guaranteed
○ Zara’s management must
■ Have an understanding of how information systems can enable winning
strategies
■ Scan the state of the market and the state of the art in technology.
● Look for new opportunities and remain aware of impending
threats.