Lecture6 - Lecture 6 Competitive Advantage with IS within...

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Lecture 6 Lecture 6 Competitive Advantage with  IS within an Organization
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Objectives Gain competitive advantages from using IS  inside the organization Three fundamental types of information  systems within organizations Basic types of functional systems Problems of functional systems Integrated, Cross-functional systems Enterprise Resource Planning (ERP) Customer Relationship Management (CRM)
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Achieving  Competitive Advantage Business determines its strategies Create business processes to achieve  its strategies IS developed to support business  processes Help organizations achieve competitive  advantage Need to avoid creating systems that are  unrelated to organization’s strategies
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Fundamental Types of IS within  Organization Calculation systems Functional systems Cross-functional systems
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Calculation Systems Relieved workers of repetitive  calculations Labor-saving devices Produced little information Examples: systems that compute  payroll and prepare paychecks
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Functional Systems Facilitates work of single department or  function Functions added to calculation system  programs to provide more value Examples: human resources; financial  reporting
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Functional Systems Problems Systems provide tremendous benefits, but  are limited because they operate in isolation Data duplication results from each application  having own database Potential lack of data integrity Business processes disjointed across functions Produces lack of integrated enterprise information Increased costs to organization
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Integrated, Cross-Functional  Systems Cross-functional systems designed to  overcome problems in functional  systems Process-based systems support  complete business processes Integrated processing systems are more  efficient
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Integrated, Cross-Functional  Systems Enterprise Resource Planning (ERP) Enterprise-wide systems Integrates value chain activities Customer Relationship Management (CRM) Makes the organization customer-centric
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Business Process  Improvement
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