REVIEW
FOR
EXAM 3
BUS3500 - Abdou Illia, Spring 2008
1
The Internet and eBusiness
Part 1
2
Brief history of the Internet
Make sure you
know what DNS
is used for.
1969 The Defense Advanced Research Projects
developed ARPANET, the precursor of the Internet
1971 Ray Tomlison invents e-mail
1979 USENET newsgroups created at Duke University
and the University of North Carolina
1984 Domain Name System (DNS) established
1991 Tim Berners-Lee creates the World Wide Web
1994 First online shopping mall, first spam email, first
pizza ordered online, first advertisement banner
2000 A major denial of service attack brings down
websites such as Yahoo!, Amazon.com, and eBay
2002 Denial of service attack knocks out 8/15 root DNS
3
servers
Accessing the Internet (www)
Web
Browser
Network
Packet
Webserver
Software
Packet
Route
Router
User PC needs:
- Workstation Operating System
- TCP/IP
- Web browser (e.g. Internet Explorer)
- Internet access (e.g. thru an ISP)
- IP Address (e.g. 128.150.50.9)
Webserver needs:
- Network (or Server) Operating System
- TCP/IP
- Domain name (e.g. eiu.edu)
- Internet access
4
- IP Address (e.g. 139.67.8.3)
Internet applications/services
 E-Mail
 File
transfers
 Instant messaging (IM)
 Newsgroups
 Streaming audio and video
 Internet telephony
 World Wide Web (WWW)
 Portal
5
Portal

Portal

Web site that offers a broad array of resources
and services; such as





email
newsgroup
Serach engines
Online shopping malls
Example: yahoo!, msn, aol
6
Other things to consider

Make sure you can answer the questions
in Quiz 3 (The quiz is posted to the Review
section of the course web site).
7
Summary Questions
Book
1) (a) Name some Internet applications/services (b)
What is Instant Messaging? (c) What is a newsgroup?
2) (a) What does a user PC needs for accessing the
World Wide Web? (b) What is needed on the
webserver side?
Notes
9,14,
15
7
3) Name some Internet connection options available for
residential users and businesses.
5-6
4) What is meant by podcasting?
16
5) (a) What is an intranet? (b) an extranet? (c) a portal
Refers to the slide #
in class posted notes
18,19
8
Information Systems for
Business Integration:
ERP Systems
Part 2
9
Business Integration?
I
V n
e t
r e
t g
i r
c a
a t
l i
o
n
Suppliers
Production
Department
Sales
Department
Logistics
Department
Horizontal
Integration
Customers
Q: what is meant by horizontal business integration? Vertical?
10
Systems for Horizontal Integration

Enterprise Resource Planning (ERP) systems

integrate all the internal processes through a common
information system (or an integrated set of info systems)
Production
Department
Process1
Warehousing
Process2
Process1
Sales
Department
Process1
Process2
Common
Database
Marketing
Department
Process1
Process2
Logistics
Department
Process1
Process2
Accounting
Department
Process2
Process1
ERP system
Process2
11
ERP Components (or Modules)

Two types of components



Core ERP Components
Extended ERP Components
Core ERP Components


Traditional components found in most ERP systems
They primarily focus on internal operations
Finance &
Accounting
Common
Database
Human
Resource
Manufacturing*
* Also called Production & Material Management
* Helps from new products development to actual production
* Handles demand forecasting, production planning, production
scheduling, quality control, etc.
12
ERP Components (or Modules)

Extended ERP Components


Extra components that might be included
They primarily focus on external operations
Customer
Relationship
Management
Supply
Chain
Management
Business
Intelligence1
Common
Database
E-Business2
1 Provide information that help users in decision-making
1 Collects info used throughout the organization, organize it, and uses
analytical tools to help decision-making process
2 Includes e-logistics (managing transportation & storage of goods over the
Internet) and e-procurement (B2B purchase & sale of supplies & services over
the Internet)
13
ERP Components (or Modules)

ERP mainly used by medium and large businesses


Average lifetime cost: $15 Million (2003 surveys)
Implementation process: up to 5 years
The largest vendors worldwide in 2005 according to Gartner Dataquest
#
Vendor
Revenue
(million $)
Market share
(%)
1
SAP
4726
28.7
2
Oracle Applications*
1674
10.2
3
The Sage Group
1221
7.4
4
Microsoft Dynamics
616
3.7
5
SSA Global Technologies
464
2.8
* In January 2005, Oracle bought PeopleSoft the 3rd player until then.
14
Factors in ERP System Success
Active support of upper management
 Having the best people on the
implementation team
 Managing the time line well
 User involvement in the planning and
implementing ERP systems

15
Summary Questions
Book
1) What is the difference between Horizontal integration
and Vertical integration? What could be the
consequences of a bad horizontal integration?
Notes
5,6
2) (a) What kind of information system is typically used by
organizations for horizontal integration?
7
3) (a) What are the core modules found in ERP systems?.?
10
4) What does the Manufacturing ERP component allow?
Name some of the activities it handles
10
5) Name the major three ERP software vendors
12
6) What are the success factors of ERP implementation?
14
Refers to the slide #
in class posted notes
16
Review Questions

Make sure you can answer the following
questions about ERP:

Chapter 10 Review Questions available in the
Notes’ section of the course web site.
17
Information Systems for
Business Integration:
EDI, SCM, CRM Systems
Part 2 (Cont.)
18
Supply Chain Management
SCM
19
Supply Chain

Supply Chain includes parties involved in the
procurement of product or raw material


Upstream parties
Downstream parties
20
Supply Chain Management SCM


SCM implies the management of
information flow between a company and
upstream and downstream parties of the
supply chain
Which of the following is NOT a potential
benefit of SCM?
a) It helps avoid shortage of raw material
b) It could shorten the time for delivering finished
products to distributors
c) It could help organizations better forecast their
production of goods and services
d) It could help organizations better forecast the needs of
their distributors
e) None of the above
21
SCM Process

Stages of SCM (SC Council’s Reference Model):
1) Planning: develop and implement processes that
attempt to forecast demand for products and services

Goal: Balance demand with supply of raw material
2) Sourcing: determine who should supply the items
required

Goal: Be supplied on time, within budget
3) Production: make the product
1) Schedule production
2) Ensure raw materials are on hand when needed
4) Product delivery (logistics)
1) Everything from receiving a customer inquiry to invoicing
2) Warehouse management is one very important factor
5) Returns: managing returns of raw materials as well as
22
finished goods
EDI: a SCM Technology

Electronic Data Interchange (EDI):

A network technology that allows the transfer
and processing of business documents (usually
orders) between a company and its suppliers
Suppliers
EDI Sys.
Value Added Network (VAN)
or
Private network connection
EDI System
Company’s Internal processes
Production
Department
Process1
Process2
Sales
Department
Process1
Process2
Delivery
Department
Process1
Process2
23
EDI: SCM Technology

EDI documents must be formatted according
to specific standards



Advantages:




ANSI X12 – used in North America
EDIFACT – international, but widely used in Europe
Eliminates paperwork
Reduces errors
Speeds supply process
Disadvantages:


Provides connection only between two companies
Limits freedom of comparing prices.
24
SCM information system


Part of extended ERP components
Could be bought separately
Suppliers
Three main functions
SCM Sys.
- Forecast demand
- Handle purchase of supply
- Manage storage + shipping
Network connection
SCM System
Company’s Internal processes
Production
Department
Process1
Process2
Sales
Department
Process1
Process2
Delivery
Department
Process1
Process2
25
Customer Relationship Management
CRM
26
CRM systems


CRM systems are systems that can help
manage all aspects of organizations’
relation with their customers.
Which of the following is NOT a potential
benefit of CRM systems?
a)
b)
c)
d)
e)
f)
Provide better customer service
Make call centers more efficient
Help sales staff close deals faster
Simplify marketing and sales processes
Discover new customers
None of the above
27
Goals of CRM systems

Goal of CRM is to increase sales and repeat business
by learning the customer




Determine the customer’s needs and preferences
Determine the customer’s satisfaction with service
Determine which customers are in the magic 20 percent (or
have the potential to become part of it)
Recency, Frequency, Monetary value (RFM) at heart
of CRM systems



How recently a customer purchased items (Recency)
How frequently a customer purchased items (Frequency)
How much a customer spends on each purchase (Monetary
Value
28
Summary Questions
Book
Notes
1) Is the information flow between a company and its
retailers part of its supply chain?
6
2) What are the potential benefit of SCM systems?
7
3) What are the 5 stages of SCM according to the SC
Council’s Reference Model?
8
4) What is EDI? What kind of network connections are
usually used in EDI? What is the EDI message
standard used in the U.S.?
9
5) Are SCM systems part of ERP systems? Are SCM
systems sold as separate system from ERP systems?
11
5) What are the potential benefit of CRM systems?
14
5) What is the main goal of using CRM systems? What is
meant by RFM?
Refers to the slide #
in posted class notes
15
29
Review Questions

Make sure you can answer the following
questions:



Chapter 8-9 review Questions posted to the
Notes’ section of the course web site.
Quiz 4 questions (posted to the Review section
of the course web site).
Extra-Credit exercise of 3/27/2008 (posted to
the Review section of the course web site).
30
Managing Security
Part 3
31
Best way to prepare

Review the ppt notes or chapter 4 in the
book to make sure you can answer the
following questions


Chapter 4 Review Questions available in the Notes
section of course web site
Extra-Credit exercise of 4/8/2008 posted to the
Review section of the course web site).
32
Managing the Development
and Purchase of IS
Part 4
33
Systems Development Methodology?

The process companies go through to
develop and maintain an information
system

Framework for successful IS development

A System Development Methodology is used


For building a new system

Or for modifying an existing system
Examples of SDM:

System Development Life Cycle
￭ Prototyping

Joint Application Development
￭ Rapid Application Development
34
Questions

Which of the following is true about SDM?
1) They provide guidelines for developing IS and maintaining them
which includes upgrading and improving them.
2) SDM are needed when a brand new IS has to be developed, but
you don’t need to use a SDM when it comes to modifying an
existing IS.
3) When a company is engaged in developing an IS, the process
involves the company’s employees who would be the future
users of the IS, and IS professionals like system analysts and
programmers. But it doesn’t involve the company’s
management
4) All of the above
35
Traditional Systems Development
Planning
Life Cycle (SDLC)
Analysis

Seven phases
1)
2)
3)
4)
Planning
Systems Analysis
Systems Design
Development
Design
5) Testing
6) Implementation
7) Maintenance
Development
Testing
Implementation

Typically one phase needs to be
completed before beginning the next

Problem in later phase may require
return to previous phase
Maintenance
36
Question

In SDLC, the 7 phases are typically
followed in a sequential order, which
means we don’t return to a previous
phase in any circumstances
 True
 False
37
Feasibility Analyses
Planning

Feasibility analyses

Technical Analysis




Can the organization afford the system?
Will it provide an adequate Benefit?
Operational Analysis (i.e. assessing the human element of
the proposed system)


Resistance to change
Organizational politics
System development schedule



Do the technologies exist to develop the system?
Economic Analysis


System Development Schedule
Is the proposed development time line realistic?
Is the programming team available during Programming
step?
Planning performed by Project Manager using



Search and investigation (e.g. for technical analysis step)
Total Cost of Ownership analysis
38
Project Management software
Systems Analysis
Analyze current system
Define new system requirement

Systems analyst works with company to understand
the problem fully and to detail the requirements of
the proposed system

Step 1: Analyze current system

Objectives:



Understand what things are done and how (business processes)
Identify any problems associated w/ current business processes
Techniques:


Observe employees at work
Talk to employees (potential users)
39
Systems Analysis

Analyze current system
Define new system requirements
Step 2: Define new system’s requirements

Main Objective:


To be defined:





Specify What need to be done (not how to do it)
Input requirements (nature of data, source, etc.)
Processing requirements
Output requirements (Types of reports, content, etc.)
Storage requirements
Tools and techniques

Data flow diagrams (DFD)
 Start with high level process
 Add more levels with increased levels of detail

Computer-Aided Software Engineering (CASE) tools
 Software that eases the systems development process
40
Data Flow Diagrams (DFD)
Process
. Symbolized by a rectangle or a curved rectangle.
. Action performed by people of organizational
units in order to transform input into output OR
Action performed by people in the organizational
units to help the units achieve their objectives
Data flow
. Symbolized by an arrow.
. Shows data being passed from or to a process
External Entity
Symbolized by a square, an external entity is
something (person, group, department, etc.)
outside the system that interacts with the system
by providing input or receiving information.
Data storage
Used to store data in the system.
Represents a file, a database, etc.
41
DFD Exercise

You should be able to answer Questions 1,
2, and 3 of the Lincoln Pizza’s ordering
system DFD exercise. Hardcopies were
given in class. You can also get a copy in
the Notes’ section of the course web site.
42
Systems Design

Using the requirements from Systems Analysis phase
to design the new or modified system.

Logical systems design




Physical systems design


Specifies all of the actual components (hardware, network, etc) used
to implement the logical design
Design frozen at end of this phase



Details the system’s functionality (what it should do?)
Uses Structure charts to create top-down representation of
system’s modules
Uses System flowcharts to show relationships between modules
Scope creep
Feature creep
Performed by system designer or (system analyst in
some case)
43
Development



Programming process is usually the most
difficult and time consuming in the
Development process.
Development performed by programmers,
database developers, and network engineers
Programmers use Program Development
Cycle
1)
2)
3)
4)
5)
Review the input, processing, output, and storage requirements
Develop the logic of the programs (using Flowcharts and Pseudo code)
Write the programs using code generators & programming languages
Test and debug the programs
Complete the programs documentation
44
Development tools
Pseudocode:
Program Flowchart:
Graphical illustration of
the problem-solving logic
within a program
English-language
statements that describe
the processing steps of a
program in paragraph
form.
Programming languages:
-Java
-C++
-Visual Basic
-Etc.
45
Testing

Programmers test modules



Development team do unit testing


Do they return proper outputs?
Do they handle incorrect data appropriately?
i.e. testing how modules work together
System testing
(software along with database and network
component)


Verification: Testing system in simulated
environment with simulated data
Validation: Testing system in real working
environment with real data
46
Implementation


Implementation strategies

Direct cutover: Quick change to new system

Parallel conversion: Old and new systems used
in parallel for a while.

Pilot testing: New system installed at only one
location or one department

Staged conversion: Only one part of the
system installed, then another part is installed.
User training
47
Maintenance
Maintenance counts for as much as 80%
of the total cost of an information system
 Tasks



Correct errors found during implementation
System enhancements


Incremental upgrades
Addition of major new features
48
Summary Questions
Book
Notes
1) What is a System Development Methodology? What is
it used for?
2)
What are the 7 phases of the SDLC methodology?
3) What kind of Feasibility analyses need to be performed
during the Planning phase? Why is the system
development schedule important?
4) What are the two steps in the Systems Analysis phase?
What techniques and tools are used during the
Systems Analysis phase?
5) What tools do programmers usually use during the
Development phase?
6) What is the difference between the Verification and the
Validation tests performed during systems testing?
49
SDLC: Recap
Steps
Key actors
Tools/Techniques
1. Planning
Project Manager
Project Management software,
Total Cost Ownership analysis, etc.
2. System Analysis
System Analyst, Users.
Interviews, observing users at
work, DFD
3. System Design
System analyst (or system
designer)
System Flowchart, Structure chart
4. Development
Programmers, database
developers, network engineers
Program Flowchart, Pseudo code,
programming languages, DBMS
5. Testing
Development team, Users
Unit testing, verification,
validation
6. Implementation
Development team, Users
Direct cutover, parallel conversion,
pilot testing, staged conversion
7. Maintenance
internal IS staff, external
consultant
Make sure you can answer questions about System
Development (see link in Review section)
50