Managing%20processes%20slides%20for%20CULearn - Managing...

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Unformatted text preview: Managing Processes What are business processes and how are they part of systems? Evolution of Systems TYPE Calculation systems Functional systems Integrated systems ERA 1950-1980 1975-20?? 2000... SCOPE Single purpose Business function Business process Typical Functional Systems Human resources Accounting & Finance Sales & Marketing Operations Manufacturing Problems of Functional Systems Data duplication Data inconsistency Limited info Isolated decisions Increased expense Solving the Problems of Isolated Information Systems Competitive Strategies & Value Chains Competitive Strategies Lowest cost in industry Better product or service in industry Lowest cost in segment Better product or service in segment CHOOSE INFORMATION SYSTEMS BASED ON STRATEGY!!! The Value Chain Source: Reprinted with the permission of The Free Press, a Division of Simon & Shuster Adult Publishing Group, from Competitive Advantage: Creating and Sustaining Superior Performance, Copyright 1985, 1998 by Michael E. Porter. All rights reserved. Primary Activities Business Process Redesign Value chains leads to new idea of integrating systems Creating new processes instead of improving existing functional systems Group Work Design a process List of steps and diagram What are the process design/redesign challenges? Business Process Design Challenges Cost Time Effort Change Outcome uncertain User resistance Guide: Thinking About Change What is change management and why is it needed? What is the top obstacle to successful change? What can alleviate resistance? What is self-efficacy? Guide: Flavor of the Month Change management programs What is Six Sigma? How would you manage this person? Change management consulting Process Management Consulting North Highland Oriel Autonomy How do companies deal with these challenges? -Simulate processes -Buy software with processes built in Simulating Processes OpTek Systems, Inc. Extend software demo What is a virtual world or microworld? What is an avatar? Virtual worlds in business What is VoIP? Skype? More simulations... VoIP for Abercrombie: More efficient process How do companies deal with these challenges? -Simulate processes -Buy software with processes built in Inherent Processes Organization must conform Integrates activities Saves costs of designing new processes Benefit from tested cross-departmental processes Inherent Processes What are the disadvantages of using inherent processes? Business Process Application Vendors (MIS in Use 7-1) SAP: Early lead in ERP Oracle: Peoplesoft (HR) JD Edwards (Mfg) Siebel Systems (CRM) Microsoft: Great Plains (Accounting) These companies provide integrated systems with inherent processes Integrated, Cross-functional IS Customer Relationship Management ( CRM) Enterprise Resource Planning (ERP) Enterprise Resource Planning Integrates all principal processes SAP first and most successful ERP Failure at McDonald's ERP Characteristics Cross-functional, process view Based on business models Centralized database Large benefits but challenging and slow to implement Very expensive Benefits of ERP Efficient processes Inventory reduction Lead-time reduction Improved customer service Real-time insight Higher profitability ERP Implementation Determine current & ERP processes Remove inconsistencies Implement the ERP system ERP Implementation Nantucket Nectars Video: What were the challenges? What conversion approach did they use? The Brose Group Problem: Too many information systems Lack of standardization Hampered communication How did they solve these problems? What were the results of this solution? Guide: ERP & the Standard, Standard Blueprint How does an organization remove differences between the standard blueprint and their processes? Drawbacks of those solutions? If all organizations go to standard blueprint will competitive advantage be lost? Is this a true threat? Specific Business Processes that use information systems... Operations Management INPUTS Resources Raw materials Operations Management: The transformation Process (e.g., Supply Chain Mgt) OUTPUTS Products Services Supply Chain Process Supply Chain Performance Drivers Facilities Inventory Transportation INFORMATION INFORMATION SYSTEMS FACILITATE ALL OF THESE! IS for designing facilities IS for tracking inventory iDA Singapore 3 Nov 04 IS for transportation Global Positioning System (GPS) Uses satellites and mobile communication technology Impact of Information on Supply Chain Performance Supply chain profitability SUM REV SUM COSTS Need for supply-chain-wide information system NEAR BEER GAME Impact of Information on Performance The Bullwhip Effect Larger inventories = lower profit Interorganizational Information Systems Solve problems of bullwhip effect and supply chain profitability S_________R_______M_________ systems Integrating SRM Purchaser SRM Purchaser CRM Supplier FMS Specific Business Processes that use information systems... Operations Management Operations Management: The transformation Process (e.g., Service Management) INPUTS Resources Raw materials OUTPUTS Products Services Service Management Material from "Service Management" by Fitzsimmons & Fitzsimmons What is Service Management? Service definition Intangible Simultaneous consumption The process is the product Examples The New Experience Economy Moving toward the "experience" Connect with customer Charge for memorable encounter Entertainment Level of Customer involvement Escapism Service Experience Design Theme the experience Harmonize impressions with positive cues Eliminate negative cues Mix in memorabilia Engage all five senses Sources of Service Sector Growth Service Innovation Technology Aging U.S. population Growth of two-income families Increase in # of singles Social Trends Service Operations Distinctions Customer Participation in Service process Simultaneity Intangibility DESIGN DELIVERY Variations Cosmetic Surgery Stress test Financial Mgt Interior Decorating Nature of the Service Act PEOPLE VS. THINGS Services directed at people's bodies: Health care Beauty salon Services directed at people's minds: Education Theaters Services directed at goods: Dry cleaning Car repair TANGIBLE VS. INTANGIBLE Services directed at intangible assets: Banking Legal Services Competitive Difficulties in Services Low entry barriers Product substitution Customer loyalty Competitive Service Strategies Overall cost leadership Seek out low-cost customers Standardize a custom service Reduce personal element Competitive Service Strategies Differentiation Making the intangible tangible Customizing the standard product Attention to personnel training Controlling Quality Market focus How do you win customers in the service industry? How to Win Customers Availability Convenience Dependability Personalization How has the internet changed these? How to Win Customers Price Quality QC dumb moment Reputation Safety/Security Speed How has the internet changed these? The Service Purchase Decision Qualifiers Service winners Price, convenience, reputation How to lose a customer in one day Speed, personalization, dependability Service losers What information systems are used in providing services? Competitive Role of IS in Services IS in healthcare Electronic Health Records Expert Systems Point of Sale (POS) Hand held devices Smart hotel rooms Information assets... KMS, CRM, etc. Micromarketing Analysis BRAND USER PROFILE LIFESTYLE & MEDIA TOP PROFILE STORES Belong to health club Buy rock music Travel by plane Give parties, cookouts Rent videos Heavy TV sports viewers Food emporium Gristede's supermarket Coors Head of household light beer 21-34 years old, middle to upper income, suburban and urban Limits on Use of Info INTERNET SHOPPING VIDEO Invasion of Privacy Deceptive Search Engine Marketin Data Security Reliability Technology leads to Self-Service SERVICE INDUSTRY Banking Airlines Movie theater Gambling HUMAN CONTACT Teller Ticket agent Ticket sale Poker dealer MACHINEASSISTED SERVICE ATM Check-in kiosk Kiosk ticketing Computer poker ELECTRONIC SERVICE Online banking Print boarding pass at home Pay-per-view Online poker Internet Service Business Models Internet Service Provider (AOL) Portal (Google) Information Content (WSJ) Online retailers (Amazon) Transaction enablers (eBay) Challenges of New Technology in Services Loss of personal attention Learning new skills Employee re-training Standardization Group Work Pick a service organization Describe how they win customers and sustain a competitive advantage Describe how they use information systems The Business Process of E-Commerce... E-Commerce Buying and selling over networks Merchant vs. nonmerchant Merchant examples... E-commerce Mistake Bricks & Mortar E-commerce OR Supplier B2B Manufacturer B2B Distributor B2B Retailer B2C Customer YOU Clicks & Mortar physical and virtual Business to Government Supplier Manufacturer Distributor Retailer B2G B2G B2G B2G Government Nonmerchant E-Commerce Auctions Competitive bidding Stated price Electronic Exchanges Clearinghouses Clearinghouse Electronic Exchanges How can company's that sell food use e-commerce for co What are the pros and cons of e-commerce? Pros & Cons of E-Commerce Cons: Limited access for some Perceptions of insecurity Easily and conveniently deliver info, goods, services to all areas 24/7 access to goods and services Global markets more accessible Lowered information costs Market efficiency... Pros: Market Efficiency of E-Commerce Disintermediation Supplier Manufacturer Distributor Retailer Customer Market Efficiency of E-Commerce Increased information removes inefficient vendors Market Efficiency Knowledge of price elasticity Losing bids Price experimentation B2C (E-tailing) Issues Channel conflict Multichanneling Order fulfillment Online Advertising Banners, pop-ups, spam Permission Marketing Viral Marketing Legal Issues Fraud Domain names Cybersquatting Microsoft goes after student Copyright laws URL & Domain name Or.... .mil for military .edu for educational institution .org for non-profit organizations From "Succeeding with Technology" Top level domains in 2005 (2007 list) E-Commerce & the WWW HTML defines structure & layout Tag is notation to define data element <h2>Price of Item</h2> Hyperlinks pointers to other web pages (URL) HTML Example with tags Level one Heading Tag to define hyperlink which has attribute "href" to provide properties about the tag HTML Example HTML ("View", "Source") Hypertext Markup Language TAGS E-Commerce Video Teva Sports Sandals Usability Designing the best web site or system Usability terms Human Factors Engineering Human-Computer Interaction User Interface User Interface design Usability engineering Usability Measures Time to learn Speed of performance Rate of errors by users Retention over time Subjective satisfaction Personalization Source: "Designing the User Interface" by Ben Schneiderman & Catherine Plaisant Design Considerations Where will it be used? How will it be used? Who will use it? Personality Cultural diversity Disabilities Age Source: "Designing the User Interface" by Ben Schneiderman & Catherine Plaisant Usability & Web Design Usability Voting machines Feature Fatigue iPod flea Dos & Donts Other good sites Web Design More on Usability... Computer Rage Video In the news...6/15/07 Decision to purchase iPhone: 90 80 70 60 50 40 30 20 10 0 Price Perform Battery Ease of use Design Ease of screen synch music wifi ease e-mail Apple Web design Software Microsoft Office Live SharePoint Designer and Expression Web Dreamweaver NvU San Francisco Giants CASE Outsourcing Processes Process of hiring another organization to perform a service Outsourcing Processes What are the issues? Dumbest moment: Outsourcing Outsourcing Advantages Obtain expertise Free up management time Cost reduction Risk reduction Outsourcing Alternatives Dell computers Microsoft Office Amazon storefront American Express Business Travel Outsourcing Risks Loss of control Benefits outweighed by long-term costs No easy exit International Outsourcing Offshoring Major advantage is operating 24/7 Controversial Shifting jobs as threat to U.S. India's Advantages Helping economy grow 9% this year It's an employee's market Flat hierarchy Benefits Skilled work (42%) outpacing simpler work (34%) Source: WSJ, Feb 07 MIS in Use: Hewitt Associates, Inc. Outsourcing HR to Hewitt Admin, healthcare, payroll, and retirement programs What do prospective customers need to know before committing to Hewitt? Jumping Aboard the Bulldozer p. 263a (Ch11!) Research says 250,000 jobs will go overseas by 2015 is this bad? Worker productivity continues to increase How do you respond to shifting jobs? Don't be blindsided Use Systems Thinking Other side of outsourcing Good/Bad for U.S.? India? What is it doing to their culture? Is becoming a mini America a good thing? How does this impact marketing, management, finance, economics, systems, entrepreneurship? The other side of outsourcin Other side of outsourcing Good/Bad for U.S.? India? What is it doing to their culture? Is becoming a mini America a good thing? How does this impact marketing, management, finance, economics, systems, entrepreneurship? Managing Processes Wrap Up: REI Processes Supply Chain Service Management E-Commerce/Usability Information systems to support processes (CRM, KMS, SRM, ERP, etc.) Outsourcing processes ...
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