Chapter 3
Electronic Business Systems
(E-Business)
Main Ref: Chapter 7 – Introduction to Information Systems, by O’Brien
& Marakas, 16th ed
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Learning Objectives
1. Identify the following cross-functional enterprise
systems, and give examples of how they can provide
significant business value to a company
– Enterprise application integration
– Transaction processing systems
– Enterprise collaboration systems
2. Give examples of how Internet and other information
technologies support business processes within the
business functions of Accounting, Finance, Human
resource management, Marketing, Production, and
Operations management
Chapter 7 Electronic
Business Systems
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What is E-Business?
• E-business means using the Internet, other
networks, and IT to support
– Electronic commerce
– Enterprise communications and collaboration
– Web-enabled business processes
• E-commerce is the buying, selling, and
marketing of products, services, and information
over the Internet and other networks
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Cross-Functional Enterprise Systems
• Cross the boundaries of traditional
business functions
– Used to reengineer and improve vital
business processes all across the enterprise
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Enterprise Application Architecture
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Enterprise Application Architecture
• Provides a conceptual framework
– Helps visualize the basic components, processes,
and interfaces of major e-business applications
• Focuses on accomplishing fundamental
business processes in concert with
– Customers
– Suppliers
– Partners
– Employees
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Enterprise Application Architecture
• Enterprise Resource Planning (ERP)
– Concentrates on the efficiency of internal production, distribution,
and financial processes
• Customer Relationship Management (CRM)
– Focuses on acquiring and retaining profitable customers via
marketing, sales, and services
• Partner Relationship Management (PRM)
– Aims at acquiring and retaining partners who
can enhance the selling and distribution of products and services
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Enterprise Application Integration
• EAI software connects cross-functional
systems
• Serves as middleware to provide:
– Data conversion
– Communication between systems
– Access to system interfaces
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EAI Example
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Transaction Processing Systems
(TPS)
• Cross-functional information systems that
process data resulting from the occurrence
of business transactions
– Transactions include sales, purchases,
deposits, withdrawals, refunds, and payments
– Online transaction processing (OLTP) is a
real-time system that captures transactions
immediately
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Transaction Processing Systems
(TPS)
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Transaction Processing Cycle
1. Data Entry: The first step of the transaction processing
cycle is the capture of business data. For example,
transaction data may be collected by point-of-sale
terminals using optical scanning of bar codes and credit
card readers at a retail store or other business.
2. Transaction Processing:
– Batch – transaction data are accumulated over a
period of time and processed periodically
– Real-Time (OLP) data are processed immediately
after a transaction occurs.
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Transaction Processing Cycle
3. Database Maintenance: updating corporate
databases of an organization to reflect changes
resulting from day-to-day business transactions
4. Document and Report Generation: including
transaction documents, transaction listings and
error reports.
5. Inquiry Processing: making inquiries and
receiving responses concerning the results of
transaction processing activities.
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Transaction Processing Cycle
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Enterprise Collaboration Systems
(ECS)
• EC systems are cross-functional information systems
that enhance team and workgroup
– Communication
– Coordination
– Collaboration
• Systems may include
– Networked PC workstations
– Servers
– Databases
– Groupware and application packages
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ECS Goals
• Communicate – share information
• Coordinate – coordinate individual work
efforts and share resources
• Collaborate – work together cooperatively
on joint projects and assignments
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ECS Tools
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Functional Business Systems
• A variety of types of information systems
that support the business functions of
– Marketing
– Operations management
– Human resource management
– Accounting
– Finance
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Functional Business IS
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Marketing Systems
• Marketing systems are concerned with
– Planning, promotion, and sale of existing
products in existing markets
– Development of new products and new
markets
– Better attracting and serving present and
potential customers
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Marketing Information Systems
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Interactive Marketing
•
Interactive Marketing
– A customer-focused marketing process
– Uses the Internet, intranets, and extranets
– Establishes two-way transactions between a business and its customers or
potential customers
How?
In interactive marketing, customers are not just passive participants who receive
media advertising prior to purchase. Interactive marketing encourages
customers to become involved in product development, delivery, and service
issues. This is enabled by various Internet technologies, including chat and
discussion groups, Web forms and questionnaires, instant messaging, and
e-mail correspondence.
•
Goal
– Profitably use networks to attract and keep customers
– Get customers to help create, purchase, and improve products and services.
– the expected outcomes of interactive marketing are a rich mixture of vital
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marketing data, new product ideas, volume sales, and strong customer
relationships.
Targeted Marketing
• An advertising and promotion management
concept with five targeting components
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Targeted Marketing Components
• Community – customize advertising to appeal to people
of specific virtual communities
• Content – advertising placed on a variety of selected
websites
• Context – advertising placed on web pages that are
relevant to the content of a product or service
• Demographic/Psychographic – web marketing efforts
aimed at specific types or classes or people
• Online Behavior – promotion efforts tailored to each visit
to a site by an individual. Example: cookie
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Sales Force Automation
• Outfit sales force with notebook computers,
web browsers, and sales contact software
– Connect them to marketing websites and the
company intranet
• Goals
– Increase personal productivity
– Speed up capture and analysis of sales data
– Gain strategic advantage
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•
For example, salespeople use their PCs to record sales data as they make their
calls on customers and prospects during the day. Then each night, sales reps.
in the field can connect their computers to the Internet and extranets, which can
access intranet or other network servers at their company. Then, they can
upload information on sales orders, sales calls, and other sales statistics, as
well as send e-mail messages and access Web site sales support information.
In return, the network servers may download product availability data, prospect
lists of information on good sales prospects, and e-mail messages.
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Production / Operations Systems
Manufacturing Systems
• Supports the production/operations
functions
– Includes all activities concerned with planning
and control of the processes producing goods
or services.
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Computer-Integrated Manufacturing
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CIM Objectives
• Simplify production processes, product designs,
and factory organization
• Automate production processes and the
business functions that support them
• Integrate all production and support
processes using:
– Networks
– Cross-functional business software
– Other information technologies
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CIM Systems
• Computer-aided manufacturing (CAM) Information systems that automate the
production process
• Manufacturing execution systems (MES) –
performance monitoring information systems for
factory floor operations
• Process Control – control ongoing physical
processes
• Machine Control – controls the actions of
machines
Note Refer to e-book for examples
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Human Resource Management (HRM)
• Information systems designed to support
– Planning to meet personnel needs
– Development of employees to their full
potential
– Control of all personnel policies and programs
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Human Resource Systems
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HRM and the Internet
• Recruiting employees through recruiting
services and databases on the World
Wide Web
• Posting messages in selected Internet
newsgroups
• Communicating with job applicants via email
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HRM and Corporate Intranets
– Process common HRM transactions
– Allow around-the-clock HRM services
– Disseminate information faster than through previous
company channels
– Collect information from employees online
– Allow HRM tasks to be performed with little HRM
department intervention
– Training
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Employee Self-Service
• Intranet applications can allow employees
to
– View benefits
– Enter travel and expense reports
– Verify employment and salary information
– Access and update personal information
– Enter time-sensitive data
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Accounting Information Systems
• The oldest and most widely used
information system in business
– Records and reports business transactions
and economic events
– Produces financial statements
– Forecasts future conditions
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Accounting Information Systems
• Typically consists of
– Order processing
– Inventory control
– Accounts receivable
– Accounts payable
– Payroll
– General ledger systems
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Accounting Information Systems
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Accounting Information Systems
• Order Processing – Captures and processes
customer orders and produces data for inventory
control and accounts receivable
• Inventory Control – Processes data reflecting
changes in inventory and provides shipping and
reorder information
• Accounts Receivable – Records amounts owed
by customers and produces customer invoices,
monthly customer statements, and credit
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management reports
Accounting Information Systems
• Accounts Payable – Records purchases from,
amounts owed to, and payments to suppliers,
and produces cash management reports
• Payroll – Records employee work and
compensation data and produces paychecks
and other payroll documents and reports
• General Ledger – Consolidates data from other
accounting systems and produces the periodic
financial statements and reports of the business
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Financial Management Systems
• Supports business managers and
professionals making decisions
concerning
– The financing of a business
– The allocation and control of financial
resources within a business
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Financial Management Systems
• Capital Budgeting – evaluating the
profitability and financial impact of
proposed capital expenditures
• Financial Planning – evaluating the
present and projected financial
performance of a business
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Financial Management Systems
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Resources
E-Text book
Chapter 7 – Introduction to Information
Systems, by O’Brien & Marakas, 16th ed
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