IT for Managers

S. Ramanathan

A Framework for Information Systems

Mgmt

Development Process
Applications Technology Foundation Concepts

Information System Resources

People Data Software Hardware Networks Technologies to

Collect data / information Transform data into information Disseminate information

A system to effectively and efficiently handle all information related tasks Capture, verify, validate

Information system

Truthful, timely reflection of facts Permit quick access to desired information Make information useful in a given context Make information available and usable

Store, retrieve

Analyze, classify, summarize, consolidate

Format, transmit, disseminate

Archive, delete

Information system
Procedures

Define work flow and steps in an activity Define processing logic, role of people E.G., Book, pencil, typewriter, telephone Computer system, word processor, modem Operational staff, supervisors, managers External users (customers)

Technology, products

People

What is a System?

Set of interrelated elements with a common goal (e.g) business system, political system

The System Concept

Systems may be abstract (conceptual) or physical

Social system is an example of abstract system Data processing system is a physical system Goals Inputs and outputs Conversion process Feedback and control Communication with other subsystems Environment Boundaries

A system is defined by

ENVIRONMENT BOUNDARY

INPUT

PROCESS

OUTPUT

Control / Feedback

Classification of Systems
Natural (rivers, lakes) or manmade (Computer) Closed (does not interact with outside world) or Open (interacts with external environment)

Expanding Role of IS

1990s2000s 1980s 90s

Electronic Business Strategic and End user support Decision Support Management Reporting Data Processing

1970s -80s 1960s 70s 1950s 60s

Leveraging IT at Different Levels

Strategic support at top Decision support for Managers Operational support for business procedures

Beware: Inasmuch as IT can make, IT can mar business too Case: Hershey Foods

IS for Strategic Advantage

C o m p e t i t i v e S t r a t e g i e s

Strategies for Competitive Advantage

Competitive Forces

Bargainin Bargainin g power of g power Suppliers of Customer s

Differentiati on Cost Innovation Growth Alliance

Rivalry of Threat of Competitors New Entrants

Threat of Substitute

Strategic Role of Information Systems

Lower Costs

Use IT to reduce the cost of business process Use IT to reduce the cost of customers and suppliers Develop IT features to differentiate products and services Use IT features to reduce the differentiation advantage of the competitor Use IT features to focus on specific markets and products
Create new products and services that include IT components

Differentiate

Innovate

Strategic Role of Information Systems Contd.

Promote growth

Use IT to manage expansion Use IT to diversify and integrate into other products and services
Use IT to create virtual organization of business partners Develop interorganizational information systems linked by the Internet and extranets to support strategic relationships with customers and suppliers

Develop alliances

Strategic Role of Information Systems Contd.

Improve quality and efficiency

Use IT to improve quality of product and service Use IT to improve efficiency Use IT to shorten the time needed to develop, produce and deliver products and services
Use interorganizational systems to create switching costs that lock in customers and suppliers Use investment in IT to create barriers for new entrants Use IT to make substitution of products unattractive Use IT to create, share and manage business knowledge

Other strategies

How can IT improve business processes?

Transactional Geographical Automational Analytical Informational Sequential Knowledge Transform unstructured processes into routine transactions Transfer information quickly across large distances Replace labour Handle complex algorithms Handle large amount of information Change the sequence of tasks; enable multiple tasks to be performed simultaneously Creation of knowledge to improve the processes

Tracking
Disintermediatio n

Ability to track any entity

Direct connect to end users

Using Information Technology for Strategic Advantage

Reengineering business processes Becoming an agile company Creating a virtual company Building a knowledge-creating company

Breaking Business Barriers with IT

Information Technologies

Hardware

Mainframes

Large and Powerful Computers Main memory: Hundreds of Megabytes to Gigabytes Slimmed over a period, but still large Reduced air-conditioning over a period of time, but still high Proprietary software environment Still used in large corporations, Government, Utility companies Useful for compute-intensive applications Platform for Data Warehousing and data Mining apps

Mini (Midrange) computers

Less costly, less powerful and easier to maintain than mainframes Can support terminals Special purpose applications scientific analysis, engineering workstations Servers

Microcomputers (PCs)
Small in size Originally developed for individual use; but has since become powerful Economical Easy networking Further miniaturization notebooks Handheld computers Palmtops - PDAs

Power of the processor doubles every 18 months Moores Law

Hardware

Size

Density of circuitry

Speed
Cost

Reliability
Connectivity

Supercomputers
Very large computers with high processing speed Designed for specialized applications requiring extensive processing power (such as complex mathematical calculations) (E.g) Weather forecasting

Organization of a Computer

Input

Process

Outpu t

Storage

Central Processing Unit The Brain

Most important hardware component CPU

Arithmetic Logic Unit (ALU)

Control Unit

Primary Storage
Main memory Also known as Random Access Memory (RAM) Holds data and programs between processing steps Volatile

Secondary Storage
For storage of data and programs

Magnetic disks Optical disks

More permanent type of storage

Input Devices
Keyboard Point and Click Electronic Mouse Trackball Pointing stick Touch pad Touch screen Pen-based Voice recognition Optical scanning, Optical Character Recognition Barcode Reader Smart cards Digitizer Web camera

Output Devices
Printers

Impact Printers
Dot Matrix Line

Non impact Printers

Inkjet Laser

Plotters Sound Card and Speakers Video

Liquid crystal displays

Storage Devices
Capacity measured in terms of bytes Binary representation of data Magnetic Disk

Floppy Disk Hard Disk RAID Storage CD (RW and R) DVD

Magnetic Tape

Optical Disk

Sequential and Direct Access

Software

Overview of Software
Software

Application Software
For end users

Systems Software
For computer system operation

General Purpose
Office automation software Email Presentation graphics Groupware

Application - specific
ERP
CRM

System Management
Operating System Network Management Utilities Performance monitors

Systems Development
Programming languages Editors Tools CASE

Security software

Application Software for End Users

Integrated packages (eg) Oracle business suite Web browsers Electronic mail and instant messaging Word processing Desktop publishing Electronic spreadsheets Presentation graphics Personal information managers Groupware Alternatives: Buy / Contract / Develop Application Service Providers Software licensing

Operating Systems
Functions:
Providing user interface Permits users to share hardware Resource management Task scheduling File management Utilities (e.g. Error logs, system accounting) Recovery from system errors Support services Popular Operating Systems: Windows, Unix, Linux, Mac OS X

Programming Languages
Facilitate a programmer to develop a set of instructions (programs) to be executed on a computer Different Programming Languages
1.
2. 3. 4. 5.

Machine Languages Assembly Languages High-level Languages Fourth Generation Languages Object-Oriented Languages

Web Languages
HTML XML Java Web Services

Data Base Management Systems

Data Basic Concepts

Field: Data item Record: Group of related fields File (table): Group of related records Data Base: Collection of logically related files

Advantages of a Data Base

Data stored in a data base are independent of the application programs using them Advantages

Controlled redundancy Inconsistency avoided Data integrity Integrated view of data Addresses unstructured information needs Enforcement of standards Security

Data Base Management System

Software interface between data base and user Facilitates
Creation Interrogation and Maintenance of data bases And application development

Interacting with Data Base

Application Programmer: thro DML, embedded in a host language (e.g. Cobol) Administrator; thro DB utilities Sophisticated User: thro query language Nave User: thro menu driven application programs

Data Base Creation

By Data Base Administrator (DBA) Using Data Definition Language (DDL) Information about cataloged and stored in data dictionary contains the names and descriptions about all types of data records and their interrelationships, access privileges, application programs using each data

Data Base Interrogation

User-friendly query language Report Generator SQL and QBE

SQL
SQL is based on set and relational operations with certain modifications and enhancements A typical SQL query has the form: select A1, A2, ..., An from r1, r2, ..., rm where P

Data Base Structures

Hierarchical Network Relational

Hierarchical Structure
Relationship between records form a hierarchy or tree like structure All relationships are one-to-many

Network Structure
Allows many-to-many relationships Relationship between data items is called sets Pointer to locate record Complex difficult to comprehend, modify, reconstruct

Relational Structure
Data elements are viewed as being stored in tables (relations) Easy to understand and implement Easy to modify Access control is easier to implement

Multidimensional Structure
Variation of relational model Can be visualized as cubes of data Useful for manipulating data with many interrelationships Support online analytical processing (OLAP) applications

Object-Oriented Structure
Used in multimedia web based applications and computer aided design (CAD) Claimed to be superior in handling complex data types such as documents, graphic images, video clips, audio segments than relational database management system

Architecture of Data Base

Schema logical view of the data base Conceptual schema created by DA for DBA Internal schema physical representation External schema users view

Database Development
Data planning Database design: Data modeling using Entity-Relationship diagram Conceptual model Logical design: in conformance with the requirements of database model chosen such as relational Physical design: data storage in the database and access methods

Data Warehouse
A planned, integrated, managed store of relevant corporate data optimized for analysis, query and reporting purposes

Data extracted from operational data bases over a period of time, screened, edited, standardized and integrated

Characteristics of Data Warehouse

Separate location for data that is used for decision support and analysis, apart from operational data Additional views of data that are relevant to users in decision support and analysis environment

Integrated Non-volatile Subject-oriented Time invariant

Capabilities of Data Warehouse

Data storage Data reconciliation Data consolidation Trend analysis Drill-down Slicing and Dicing Graphical output

Types of Data warehouse Applications

Market Analysis Financial Analysis Sales Support Customer Service

Data Mining
Data Mining: Process in a data warehouse to identify patterns knowledge discovery Data Mart: subset of Data warehouse

Telecommunications and Networking

Advantages of Networks
Common storage Sharing of resources Sharing of applications Centralized administration

Imagine breaking these barriers without Networking

The Internet Revolution

Internet is a computer network made up of thousands of networks worldwide. There are millions of computers connected to the Internet and the number is growing at a rapid rate No one is in control of the Internet.

Internet - Contd.
There are organizations which develop technical aspects of this network and set standards for creating applications on it. The Internet backbone, through which Internet traffic flows, is owned by private companies. All computers on the Internet communicate with one another using the Transmission Control Protocol/Internet Protocol suite, abbreviated to TCP/IP.

Business Use of Internet

Information Email Discussion forums Publishing thoughts, opinions, news Buy and sell Chat data and voice

Business Value of the Internet

Cost reduction More opportunities for marketing Informed decision-making Effective and efficient communication Breaking geographical and time barriers

Types of Networks
Classified on the basis of size, complexity and geographical spread Local Area Network (LAN): Collection of networked computers within a premises Wide Area Network (WAN): Connecting computers, in which a public network service is also used

Local Area Network

Usually private owned Topologies: Bus, Ring and Star Media: Copper cables, Fibre optics Transmission speed: 10 Mbps to 1 Gbps Benefit: Resource sharing

Wide Area Network

WAN can transmit information across a wide geographic area Can use both public and private networks Error control more difficult than LANs

Intranets and Extranets

Intranets use Web-based and Internet technology to inexpensively and easily share [organizational] data across a private network within an organization
Extranets connect companies with their suppliers and customers via Web links. Extranets facilitate supply chain information sharing

Modems
Modulator / Demodulator Necessary because data communication takes place on a telephone line Converts digital signal to analog and back Speed measured in baud rate Support for transmission error control, auto dial and answer

Multiplexors
Facilitate simultaneous data transmission from many terminals over a single channel. Used to link several low speed lines to a high speed line

Client / Server Network

Network management from a central computer called server Client makes requests to the server and the server responds with the required information User-friendly interface and part of application logic in client Data storage at the server end: Robustness, Security Flexibility Scalability Reduced cost

A Typical Client
Usually manages the GUI

E.g. Windows, Mac OS, workstation Unix

Manages the display of data Performs data input and validation Dispatches requests to server(s) Manages local environment

Display Keyboard

A Typical Server
A program that carries out client requests
o

E.g. Unix, Windows N/T, MVS

RDBMS Printer Business Logic Files

Usually manages some unique resource

o o o o

Client / Server Architectures Two-tier

Architecture

client with a front end program server with data base

With increasing complexity of application, client program will grow bigger (fat client) Only limited scalability

Limitations:

Client / Server Architectures Three-tier

Architecture

Client focussed on GUI tasks

Application servers focussed on application logic Data base servers

Network Topologies
Bus Ring Star Mesh

Bus Topology

Bus Topology Contd.

All stations connected along a single transmission medium Only one computer can communicate at a time Extension by repeaters Advantages Network will not fail, if a node fails Easy to use and understand Least amount of cable and less expensive Easy to expand Disadvantages Degradation high because of attenuation caused by taps to medium Heavy traffic affects the speed Vulnerability to break-down in channel All nodes have access to data on the channel: protection of data

Star Topology

Star Topology Contd.

All computers connected to a single hub, which establishes connections between stations Resources and management centralized Throughput depends on hub Advantages

Easy to add / remove nodes Node failure does not affect the network Easier to diagnose network problems through hub Vulnerable to failure of central hub Cable cost is higher

Disadvantages

Ring Topology

Work Station/Node

Work Station/Node

Work Station/Node

Work Station/Node

Ring Topology Contd.

All the nodes are connected in the form of a ring through repeaters Unidirectional flow Every repeater checks the packet for destination and passes it on Since signals are regenerated at each repeater, longer distances can be covered

Ring Topology Advantages and Disadvantages

Advantages

Easily extendable Predictable delay (Token passing access) Better throughput

Vulnerable Difficult to troubleshoot Message delay proportional to the number of nodes Adding / removing computers can disrupt network Maintenance problems restrict number of workstations

Disadvantages

Mesh Topology

Mesh Topology Contd.

Every node is connected to every other node Full and Partial mesh topologies Advantages

Minor faults will not disrupt the network Highly reliable Adding / replacing a machine will disrupt the network Installation and maintenance costs are high

Disadvantages

Network Standards
International Standards Organization (ISO): Open Systems Interconnect (OSI) model American National Standards Institute (ANSI): Fibre Distributed Data Interface (FDDI) and other communication standards Electronic Industries Association (EIA) electrical transmission standards EIA/TIA 232 (formerly RS 232) Institute of Electrical and Electronic Engineers (IEEE): networking standards 802.3, 802.5 International Telecommunications Union (ITU): standards for telecommunications X.25 Internet Activities Board (IAB) improvements in Internet standards TCP/IP, SNMP

OSI Model
Seven layers logical partitions for system system communication Each layer performs a specific function

The OSI Model

Application
Presentation Session Transport Network Data link Physical Peer Communication

Application
Presentation Session Transport Network Data link Physical
1 2 3 4 5 6 7

Information Flow Network Medium

Physical Layer
Defines mechanical and electrical characteristics to establish and maintain the physical connection Digital ones and zeroes are converted to electrical signals Issues addressed

Physical topology Synchronization of bits Transfer rate Transmission mode

Network Interface Card

Provides connection between a computers internal bus and network media Comes in many shapes and sizes Vary by the type of bus connection they employ Have a unique identification number

Transceiver
Part of any network interface (transmitter / receiver) Appearance and function vary with the type of network cable and topology in use

Repeater
Amplifies the signal it receives on one port and resends them on another Extends maximum length of a network segment Disadv: Amplifies everything it receives

Hub
Also called a concentrator central connection point for several network devices a multiport repeater Classified as

Active hub Passive hub

Data Link Layer

Responsible for

Creating packets (Logical chunks) Transmitting packets Receiving packets Logical addressing Detection of and recovery from errors Controlling media access
Contention Polling Token passing

Flow regulation: synchronization of fast transmitters and slow receivers

Network Layer
Controls the operation of the network Determines route from source to destination Handles congestion problems

Routers
Operate at Physical, Data Link and Network layers Connect heterogeneous LANs

Transport Layer
Ensures data transfer between end points with error recovery and flow control Breaks down messages into packets, addresses the packets, forwards them, reassembles them at destination node

Session Layer
Provides control structure for communication between applications Establishes, manages and terminates connections (sessions) between cooperating applications Functions

Managing dialog control Synchronization

Presentation Layer
Concerns itself with information representation Transforms information from machine format to user understandable format Services: data translation conversion of file formats encryption

Application Layer
All exchange of information between the user and the network occurs through this layer Responsible for user and application program support such as passwords resource sharing file transfer network file system electronic mail remote login directory services inter-process communications remote procedure call

Gateways
Operate at all layers Enable different communication architecture to communicate Maps functions performed by one application in one computer to another on a different computer

Networking Protocols
Set of rules for sending information over a network Functions

Data transmission mechanism Communication session initiation and termination Addressing and routing Authentication and verification Encryption and compression Error correction

WAN Message Transmission Techniques

Message Switching: sending a complete message to a concentration point for storage and routing to the destination as soon as the communication path is available. Transmission cost based on message length Packet Switching: breaking message into packets, route them individually. Transmission cost based on packet and distance. Error and flow control procedures Circuit Switching: physical channel established between communicating equipment; connection, once established, used exclusively by two users. No error or flow control. Virtual circuits: logical circuit

Switched Virtual Circuit (SVC): Dynamic on-demand connectivity Permanent Virtual Circuit (PVC): always on-line connection

Base Band Network

Single channel frequency Transmit signals without modulation Half duplex transmission Operates at a shorter distances (< 2 miles) Speed: upto 100 Mbps

Broadband Network
Multiple channels and multiple signals at different frequencies Capable of supporting wide range of data, incl. audio and video Full duplex transmission Speed: upto 10Gbps

Virtual Private Network (VPN)

Use of public network to create a secure network among preselected users Less expensive than dedicated lines (eg) Auto manufacturer and its dealers network

Twisted-Pair Cable
Consists of two strands of copper wire twisted together. Twisting reduces the sensitivity of the cable to EMI and also reduces the tendency of the cable to radiate RF noise Low cost, inexpensive to install lowest cost per foot of any cable Disadv: Cross talk, Noise

Twisted Pair Cable

Shielded Twisted Pair (STP)

Unshielded Twisted Pair

Categories of Twisted Pair Cables

Unshielded Twisted Pair Cable Categories 1 and 2
Voice cables & low data rates < 4Mbps

Category 3
Data rates upto 10Mbps. New standards however support upto 100Mbps.

Category 4
Consists of 4 twisted pairs. Supports upto 16Mbps

Category 5
Data grade cable with 4 twisted pairs. Supports upto 100 Mbps

Coaxial Cables
Central copper conductor enclosed in an insulating sheath outer metallic case for transmission of high frequency signals

Coaxial Cable

Types of Coaxial Cables

Thinnet

Light & flexible cable Inexpensive easy to install. Approximately .25 inches(6mm) in thickness
Appx. .5 inches (13mm) in diameter harder to work with but can carry more signals a longer distance(500m) than Thinnet More expensive relatively safer to install outside, running from building to building

Thicknet

Optical Fibre
Transmission of signals in the form of light Higher bandwidth More reliable Extremely secure: Difficult to tap No cross talk High cost

Fiber Optics Cable

Data travels in the form of light Light sources could be LEDs and lasers The centre coductor is a fiber that consists of highly refined glass or plastic designed to transmit light signals with little loss. Glass core supports longer distance but plastic core is easier to support with. Fiber is coated with a cladding or a gel that reflects signals back into the fiber to reduce signal loss. A plastic sheet protects the fiber The end of the cable that receives the light signal must convert it back to electrical form

Fiber Optics Cable

Rationale for Unbounded Media

Space constraint Mobile people Temporary Installation Satellite office or branches Ships in Ocean Teams in remote field locations

Radio Waves
Used where cabling is difficult (eg) communication to ships from shore, communication among mobile police force Should get Govt. clearance for usage of frequency Cheap Easy to tap Interference and Noise

Micro Wave
Useful, where cable communication is difficult Line of sight between sending and receiving stations High cost of installation Easy to tap Interference and Noise

Satellite Communication
Transmission across globe Uses artificial satellites Satellite terminals at the sending and receiving ends Reliable Expensive

Wireless LANs
Avoids cabling issues Uses radio technology Short-range wireless technology: Bluetooth in computers and other devices: rate of 1 Mbps within 10 to 100 metres

Wireless Web
For Smart telephones, pagers, PDAs Standard wireless application protocol (WAP): specifies conversion of web pages in HTML / XML into a wireless markup language (WML) to be accessible in a Web-enabled wireless device Third generation (3G) wireless technologies to raise transmission speeds to enable streaming video and multimedia applications on mobile devices

Integrated Voice, Data and Video

Formally known as Integrated Services Digital Network (ISDN) Integrates voice, data and video through digital switching and transmission for worldwide communication Narrowband and Broadband Uses CCITTs X.25 standard

Network Administration and Control

Ensures proper functioning of network Security Monitoring usage and throughput Load balancing Response to security violations Back-up and recovery Planning for scalability Requirements: Knowledge of network topology and protocols, administration tools

Network Operating System

Renders the network as an unified, controlled and uniform computing environment Enabling terminal local and remote access to server(s) Sharing of network resources Checking user authorization to specific resources

Network Performance Metrics

Measures of Communication Network performance

Latency: delay of transmitting a message from source to destination Throughput: quantity of work per unit time, measured in terms of bytes per second

IP Addressing
Internet addresses are managed by the Internet Assigned Numbers Authority (IANA), which has overall responsibility of the IP pool and by the Regional Internet Registry (RIR) organizations to which IANA distributes large blocks of IP addresses Unique IP address for each host and network component 32 bit segmented into four 8 bits (octets), separated by dots 01010000.00011110.00000011.00011000 80.30.3.24 Two pieces of information

Network id Host id

Classes of IP Addresses
A: assigned to networks with a very large number of hosts

First bit zero Balance bits in the first octet network id Remaining 24 bits host id
First two bits 10 Next 14 bits network id Balance 16 bits host id First three bits 110 Next 21 bits network id Last 8 bits host id

B: medium to large sized networks

C: Small networks

Classes of IP Addresses Contd.

D: for multicast groups hosts related in some manner

First four bits 1110 Remaining bits uniquely identify the group of hosts First four bits 1111

E: reserved for future

TCP/IP supports only A,B and C

IPv6
IP addresses are being extended beyond computers IPv6 increases the address size from 32 bits to 128 bits Can support up to 340 trillion trillion trillion addresses Example

IPv4 address: 198.51.100.14 Unique identifier: 4,294,967,296 IPv6 address: 2001:DB8:BE:C001:1234:ABCD:22:1 Unique identifier: 340,282.366,920,938,463,463,374,607,431,768,211,4

Information Systems in Business

Types of Information Systems

Information Systems Operations Support
TPS Process Control Enterprise Collaboration Management Support MIS EIS

DSS

Information Requirements of Decision Makers

Ad hoc

Unscheduled
Summarized Infrequent

Unstructured

Strategic Management
Tactical Management

Forward looking

External
Wide scope Prespecified Scheduled

Semistructured

Detailed

Structured

Operational Management

Frequent Historical Internal

Narrow focus

Information System and Decision-Making

EIS
MIS

TPS

Transaction Processing System (TPS)occur as part of Transactions events that

doing business (eg) sales, purchase Information systems that process data resulting from the occurrence of business transactions (eg) invoicing, goods receipt Online Transaction Processing (OLTP): for better customer service and hence a strategic need Transaction Processing Cycle: Data capture Data process data base update Document and Report generation Query process

Data Entry
Input activity in transaction processing system Speed and accuracy problems Automated methods of data entry (source data automation):

POS terminals, ATMs Bar codes Magnetic stripes Optical scanning OCR Pen-based tablet PCs Touch screens Voice recognition system

Data Processing
Batch processing: transaction data accumulated over a period of time and processed periodically (eg) day end process in a bank Realtime processing (online processing): Data processed immediately after a transaction occurs

Batch Processing
Advantages:

Economical Some applications are necessarily batch processes (eg) payroll

Current status may not be available

Disadvantages:

Realtime Processing
Particularly important for applications where a high frequency of changes are made in a short period and currency of data is critical Data base protection is more critical than in batch process More controls to prevent unauthorized access High cost

Fault Tolerant Systems

Built-in back-up failover capability Multiprocessor technology Redundancy in memory, disk drives, software etc.

Transaction Documents

Document and Report Generation

Action Documents: initiates action or transaction on the recipient (eg)purchase order Information Documents: confirmation to the recipient that the transition has occurred (eg) sales receipt Turnaround Document: Designed to be returned to sender in whole or in part as acknowledgement (eg) delivery challan Control listings: detailed listing of transactions (eg) payroll report Edit reports: description of errors during processing (eg) error reports

Reports

Management Information Systems

Produces information products that support many of the day-to-day decision making needs of the management Types of reports

Periodic (eg) weekly sales analysis Exception (eg) list of customers who have exceeded credit limit On-demand Push (eg) selective broadcast of reports

(eg) sales analysis reports

Executive Information Systems

Focus on strategic needs of top management Graphical displays Drill-down Exception reporting Trend analysis Web access

Groupware for Enterprise Collaboration

Software that enables multiple users to share information with one another and to work together on multiple projects (eg) Lotus Notes, Novell Groupwise, , Microsoft Exchange, Netscape Communicator Collaboration through e-mail, data or audio conferencing, discussion forums, scheduling and calendaring, joint document creation etc. Use over Internet or intranets and extranets Designed to make communication and coordination of workgroup activities easier irrespective of location of the team Important applications: Document management Workflow systems Knowledge management

Office Automation Systems

Main purpose: improving office productivity

Word processing Spreadsheet Database management Graphics

Information Systems in Functional Areas

Strategic Sale Order Forecast

Planning

Dispatch Invoicing/

MPS RCCP

A/c Receivable

WO / Sch Creation

Operations Planning

MRP

Purchase

Stores

Receipt Execution

Production

Bill Passing

A/C payable

GL MIS / EIS

EIS

Business Modules in an Enterprise System

Finance
Manufacturing

HR
Production Planning

Quality

Enterprise System Maintenance

Sales &

Materials

Distribution

Finance
Financial Accounting (GL, A/R, A/P, Fixed Asset, P&L, Balance Sheet) Costing (Cost centre accounting, Product Costing, Activity Based Costing) Treasury (Cash, Funds, portfolio management, Risk analysis) Control (Budgeting, MIS, EIS) Scenarios

Manufacturing
Capacity Planning Material Requirement Planning (MRP) Shop Floor Control Engineering Data Management Configuration Management Lot control/ traceability Tooling Lobour Productivity Computer-Integrated Manufacturing (CIM)

Computer-Aided Engineering (CAE) Computer-Aided Design (CAD) Computer-Aided Process Planning (CAPP)

Process Control

Materials Management
Pre-Purchasing Activities Purchasing Vendor evaluation Material Inspection Inventory Management Supplier Bill Passing Tracking of material on-order Reservation Consignment Stocks Stock valuation Perpetual audit

Quality
Quality Planning (Material Specifications, Inspection Planning) Inspection and follow-up action Quality Control (Dynamic sample determination on the basis of history, QC Charts

Sales and Distribution

Customer Data Base Sales Forecast Order Processing Finished Goods Stock (Reservation, Analysis, Valuation, Lot Control) Distribution Requirement Planning (DRP) Despatch (Due Date Monitoring , Pick List) Invoicing (Credit and Debit Notes, Proforma Invoices, Cancellation of Invoices, Discounts) Pricing (Costing, Quotations) Sales Support (Customer Data, Prospect List) Export Sales Force Automation

Human Resources
Personnel (Employee database, recruitment, benefits administration) Organization (Organization Structure, Job Descriptions) Payroll (Salary Preparation, Staff Cost) Time & Attendance (Time Recording, Shift Planning) HRD (Career and Succession Planning, Profile Maintenance, Training Needs assessment, Training Management)

Plant Maintenance
Preventive Maintenance Planning Equipment Tracking Component Tracking Calibration Tracking Warranty Claims Tracking

Enterprise Business Systems

Enterprise Resource Planning (ERP) Supply Chain Management (SCM) Customer Relationship Management (CRM)

WHAT IS ERP?
The techniques and concepts employed for the integrated management of business as a whole from the viewpoint of the effective use of management resources

Information Integration through ERP

Business Planning Finance

Manufacturing

Human Resources

ERP Materials Logistics

Quality
Sales & Distribution

Maintenance

ERP
Traditional applications are functionally oriented and lines of demarcation become barriers to communication

Materials

Production

Marketing

Finance

ERP is business process based and improves communication and accountability

Organization as a stream of Business Processes

AN EXAMPLE: Order Fulfillment Process Order receipt Order Processing Production Planning Material Planning Purchase Order Release Work Order release Production Monitoring Warehousing Despatch Instructions Billing Accounts Receivable

WHY ERP?
All processes are customer focused Everybody in the value chain is fully informed about the process Single repository or information and hence non redundancy Updates across functions maintaining consistency Information access across functions

Main Benefits of ERP: Accountability

Responsibility Communication

What can you expect from ERP?

To enable improved business processes

Cycle time reduction Increased business agility On-time delivery Inventory reduction Order fulfillment improvement Increased flexibility Improved supplier performance Reduction in quality costs Improved resource utility Better customer satisfaction

What more can you expect from ERP?

To provide flexible, integrated, realtime decision support

Improved information accuracy Better decision making capability

Still More
To support business growth requirements

Multiple product lines Multiple languages Multiple currencies

To eliminate limitation of legacy systems

Fragmentation of data and processing inflexibility to change obsolete technologies

ERP Top Players in India

SAP, Business One Oracle Microsoft Dynamics, Navision, Axapta J D Edwards Peoplesoft MfgPro Marshall BaaN MakeESS

For ERP to succeed

clarity of expectations from ERP top management commitment reasonable scope adequate resources the right product the right people for implementation Participation of end users proper communication within the organization steering committee and strong leader balanced team good training sound and appropriate Implementation methodology good monitoring and review mechanism

Trends in ERP
Industry specific versions Additional Features Targeting SME Segment Stratified offerings with reduced functionality Lower Entry Price Faster deployment methodologies Extension to Non-manufacturing Sectors Retail, Utilities, Government, Service Web enabling

Additional Features
Integration with Business Intelligence Systems Supply Chain Management Capability of integration with Electronic Data Interchange (EDI) and Electronic Fund Transfer (EFT) Smooth integration with popular CAD packages Integration with workflow Simulation capability (useful for capacity calculation) Data warehousing and Data Mining

What is CRM?
a multifaceted process, mediated by a set of information technologies, that focuses on creating two-way exchanges with customers so that firms have an intimate knowledge of their needs, wants, and buying patterns. Wikipedia definition CRM helps companies understand, as well as anticipate, the needs of current and potential customers

So, What is CRM?

Enhancing the experience of customers Identifying, and capturing information on customers Unified view of customer across the enterprise

What Constitute Customer Relationship Management?

Customer Support
WWW Fax Post

Sales -Cross-sell -Up-sell

email Telephone

Customer or Prospect Cell

Different Aspects of CRM

Customer facing operations Back-office operations Collection of metrics

Components of CRM
Sales Force Automation

Lead tracking Opportunity management Contact management Partnership relationship management

Call centre management Online help facilities Internal help desk Expert systems

Customer Service and Support

Components of CRM Contd.

Marketing Automation (Customer facing)

Online catalog Campaign management Surveys Contest management Distribution of marketing materials Email marketing Customer intelligence
Gathering customer data Analyzing data Formulating strategy action

Types of CRM
Operational CRM:

Makes customer interaction with the company easy

Extracts customer preferences from data warehouse Input for customizing products to suit customer needs and maximize customer value

Analytical CRM:

Collaborative CRM:

Integrates supply chain for higher responsiveness

Internal and external information base of customers accessible to employees for better customer service

Portal-based CRM:

Supply Chain Management

What is a Supply Chain?

Includes all parties involved in fulfilling customer request Includes manufacturers, suppliers, transporters, warehouses, retailers and customers Includes functions such as order receipt, order execution, operations, distribution, finance, customer service.

Role of IT in SCM
IT integrates the internal business functions so that availability of data is current and uniform across the organization. The current data availability ensures control of processes and verification of performance Availability of accurate information across the organization ensured reduction of physical inventories and resource requirements. Redundant physical assets maintained to handle supply chain uncertainties were no more necessary

Benefits of e-SCM
Scalability: 24*7 availability

Capability to handle multiple requests

Reduced interaction cost: Quick and economical search Reduced cost of coordination Aggregate purchasing Easy comparison shopping Reduced maverick spending

Benefits of e-SCM Contd.

Level Play: No entry barrier

Economy:

Sourcing at globally competitive prices

Substitution of inventory with information

E-SCM improves supplier performance

Free Flow of Communication
Transparency Accountability

Improved supplier performance

EBG - Electrical Sector

Network Connectivity with :

400 Stockists
(E-enabled)

28 Regional / Branch Offices

600 Vendors
(E-enabled)

4 Factories

9 Godowns

www.LNTEBG.com

B2B Purchase Queries for Vendors

Purchase Orders
Login & Authentication

Goods Receipts
Accounts Details

Selection Criteria : From date -- To date Document number Material Plant

Purchase Order (PO) Query

Orders with schedules Orders awaiting invoice

Closed Orders
Summary : PO number, date, material code, description, rate, qty supplied, qty pending, delivery schedule
Full PO : by clicking PO number in summary

Goods Receipt (GR) Query

Cleared GRs GRs pending for quantity check

GRs awaiting inspection

Summary : GR number, date, PO ref., challan ref., qty supplied, accepted, rejected, VQR
Rejection Details : by clicking on quality lot number

Accounts Query
Open invoices Paid invoices

Bill number, date, PO ref., due date, amount, invoice errors (if any), cheque details for cleared invoices

WE BUY, YOU QUOTE