Chapter 5
Introduction to e-Business Systems
Learning Objectives
 Give examples of how Internet and other information technologies
support business processes within the business functions of ..
 Accounting,
 Finance,
 Human resource management,
 Marketing, and
 Production and operations management.
 Identify the following cross-functional system concepts, and how
they can provide significant business value to a company:
 Cross-functional enterprise systems
 Enterprise application integration
 Transaction processing systems
 Enterprise collaboration systems
Section 1
Functional Business Systems
IT in Business
 “Business managers are moving from a tradition where they could
avoid, delegate, or ignore decisions about IT to one where they
cannot create a marketing, product, international, organization, or
financial plan that does not involve such decisions.”
Marketing Systems
 Marketing Information Systems provide information technologies
that support major components of the marketing function.
 Interactive Marketing
 Customer focused marketing process
 Based on using Internet, intranets, & extranets to
establish two-way communications between customers
or potential customers and the business
 Customers become involved in product development,
delivery, & service issues
 Targeted marketing
 Five targeting components
 Community
 Content
 Context
 Demographic/psychographic
 Online behavior
 Sales Force Automation
 The sales force is connected to marketing websites on
the Internet, extranets, & the company intranet
 Increases productivity of sales force
 Speeds up the capture & analysis of sales data
 Allows management to provide improved delivery
information & better support of the sales force.
Manufacturing Systems
 Support the production/operations function
 Assists firms in planning, monitoring, & controlling inventories,
purchases, & the flow of goods and services
 Computer-Integrated Manufacturing (CIM)
 Simplify
 Automate
 Integrate
 Supports the concepts of flexible manufacturing systems, agile
manufacturing, & total quality management
 Computer-Aided Engineering (CAE)
 Computer-Aided Design (CAD)
 Material Requirements Planning (MRP)
 Computer-Aided Manufacturing (CAM)
 Automate the production process
 Manufacturing Execution Systems (MES)
 Performance monitoring systems for factory floor operations
 Process Control
 The use of computers to control an ongoing physical process
 Machine Control
 The use of a computer to control the actions of a machine.
 Also called numerical control
Human Resource Systems
 Human Resource Information Systems
 Support
 Planning to meet the personnel needs of the business
 Development of employees to their full potential
 Recruitment, selection, & hiring
 Job placement
 Performance appraisals
 Employee benefits analysis
 Training and development
 Health, safety, & security
 HRM and the Internet
 Allows companies to process most common HRM applications
over their intranets.
 Allows companies to provide around-the-clock services to
their employees.
 Allows companies to disseminate valuable information faster.
 Allows employees to perform HRM tasks online.
 Staffing
 Supported by information systems that record and track
human resources to maximize their use
 Training and Development
 Help human resource managers plan and monitor
employee recruitment, training, and development
programs
Accounting Systems
 Record and report business transactions and other economic events
 Online Accounting Systems
 Six widely used accounting systems
 Order processing
 Captures & processes customer orders and produces
data needed for sales analysis and inventory control
 Inventory Control
 Processes data reflecting changes in items in inventory.
 Helps provide high-quality service while minimizing
investment in inventory & inventory carrying costs
 Accounts Receivable
 Keeps records of amounts owed by customers from
data generated by customer purchases and payments
 Accounts Payable
 Keeps track of data concerning purchases from, and
payments to, suppliers
 Payroll
 Receives and maintains data from employee time cards
and other work records
 General Ledger
 Consolidates data received from accounts receivable,
accounts payable, payroll, & other accounting
information systems
Financial Management Systems
 Supports financial managers in decisions concerning
 The financing of the business
 The allocation & control of financial resources within the
business.
 Major financial management system categories
 Cash Management
 Collects information on all cash receipts and
disbursements on a real-time or periodic basis
 Investment Management
 Helps the financial manager make buy, sell, or hold
decisions for each type of security
 Helps the financial manager develop the optimum mix of
securities in order to minimize risk and maximize return
 Capital Budgeting
 Involves evaluating the profitability and financial impact
of proposed capital expenditures
 Allows financial managers to analyze long-term
expenditure proposals for plant and equipment
 Financial Forecasting & Planning
 Evaluate the present and projected financial
performance of the company
 Help determine financing needs and analyze alternative
methods of financing
 Explore what-if and goal-seeking questions
Section 2
Cross-Functional Enterprise Systems
Cross-Functional Enterprise Applications
 Integrated combinations of information subsystems that share
information resources and support business processes across the
functional units
 A strategic way to use IT to share information resources & improve
efficiency & effectiveness
 Enterprise Application Architecture
 Focused on accomplishing fundamental business processes
in concert with the company’s customer, supplier, partner, &
employee stakeholders
Enterprise Application Integration (EAI)
 Software enables users to model the business processes involved in
the interactions that should occur between business applications.
 Also provides middleware that
 Performs data conversion & coordination
 Provides application communication & messaging services
 Provides access to the application interfaces
 Business value
 Integrates front-office and back-office applications to allow for
quicker, more effective response to business events and
customer demands
 Improves customer and suppler experience with the business
because of its responsiveness.
Transaction Processing Systems
 Cross-functional information systems that process data resulting
from the occurrence of business transactions
 Transactions – events that occur as part of doing business
 Sales
 Purchases
 Deposits
 Withdrawals
 Refunds
 Payments
 Online transaction processing systems
 Real-time systems that capture and process
transactions immediately
 Adds value to product or service through superior
customer service
 Transaction Processing Cycle
 Data entry
 The capture of business data
 Transaction processing
 Two basic ways
 Batch processing where transaction data are
accumulated & processed periodically
 Real-time processing where data are processed
immediately after a transaction occurs
 Database maintenance
 Corporate databases are updated to reflect the day-today business transactions
 Document and report generation
 A variety of documents and reports are produced
 Inquiry processing
 Inquiries and responses concerning the results of
transaction processing activity
Enterprise Collaboration Systems
 Cross-functional e-business systems that enhance communication,
coordination, & collaboration
 Communicate – share information with each other
 Coordinate – coordinate individual work efforts & use of
resources with each other.
 Collaborate – work together cooperatively on joint projects
and assignments
 Tools for Enterprise Collaboration
 Electronic communication
 E-mail
 Voice mail
 Fax
 Web publishing
 Bulletin boards
 Paging
 Internet phone systems
 Electronic conferencing
 Data & voice conferencing
 Videoconferencing
 Chat systems
 Discussion forums
 Electronic meeting systems
 Synchronous. Team members can meet at the
same time and place in a “decision room” setting
 Collaborative work management
 Calendaring & scheduling
 Task & project management
 Workflow systems
 Knowledge management