Chapter 7

Chapter 7 discusses the process and supporting on information systems in the levels of an organization. It explores the way organizations uses three types of processes and how they use information systems. The chapter talks about process quality and how it can improve the information system. Then explains information systems in one level of an organization and how it leads to problems in silos. Also how these silo problems can be solved at the next level of the organization. The chapter also goes into enterprise systems such as CRM, ERP and EAI. Then how these inter enterprise IS can solve enterprise level silos. Last, how the future in implications of mobility and the cloud of the future enterprise and interenterprise IS.

Q1: What are the basic types of processes?

First, they’re a network of activities that generate value by transforming inputs to outputs. The basic types of processes are human only processes, human processes with computer help, computer only processes. There’s a difference between structured processes and dynamic processes. Structured processes are formally defined, standardized processes involving day-to-day operations. This also includes accepting a return, placing an order, purchasing raw materials, and so forth. Dynamic processes are flexible, informal, and adaptive processes normally involving strategic and less structured managerial decisions and activities. Now processes that use the three levels of organizational are workgroups, enterprises and inter-enterprises. Workgroup help a workgroup to accomplish a goal.  Workgroup IS used to support one or more IS processes. Enterprise processes spanning multiple departments. Enterprise IS support enterprise processes. Inter-enterprise processes that require cooperation amongst different entities. The workgroups represent six of the nine value-added activities. There are various characteristics of information systems. Characteristics of departmental information systems are summarized in Workgroup. Often, procedures are formalized in documentation, and users frequently receive formal training in use of those procedures.

Q2: How can information systems improve process quality?

Processes are means people use to organize an activity to achieve organization’s goals. Two dimensions of process quality are efficiency and effectiveness. Information systems can improve by process efficiency which is the ratio of outputs to inputs. Better quality can be achieved by process effectiveness which is how well a process achieves organizational strategy. So processes can be improved either by change process structure, change process resources and change both. In addition, process quality can include performing an activity, meaning partially automated or completely automated. Also, augmenting human performing activity or controlling data quality to ensure data is complete and correct before continuing process activities.

Q3: How do information systems eliminate problems of information silos?

First what are the problems of information silos? The problems of information silos are data duplicated, data inconsistency, data isolated, disjointed processes, lack of integrated enterprise information., inefficiency: decisions made in isolation, increased cost for organization. The reason an information silo exist, is to isolate data in separated information systems. Information system silos arise when either IS supports departmental processes rather than enterprise-level processes. Also when personal and workgroup support applications are created over time. This includes growing organizations, especially by merger and acquisitions. The problems of information silos are duplicated or inconsistent data. Which may be separate supporting applications causing difficulty for two activities. These activities are to reconcile their data, getting approvals will be slow and possibly erroneous Another problem is the lack of integrated enterprise data as a consequence of disjointed systems. The problem of inefficiency results from making decisions in isolation. Finally, Information silos increase costs because of duplicated data, disjointed systems, limited information, and inefficiencies. Information silos solve problems in organizations by isolating data created by workgroup information systems and integrates using enterprise-wide applications. It also isolates data created by information systems at an enterprise level and are integrated into inter-enterprise systems using distributed applications. So it integrates into a single database, revise applications and allows isolation.

Q4: How do CRM, ERP, and EAI support enterprise processes?

Over time, three categories of enterprise applications have emerged: customer relationship management, enterprise resource planning and enterprise application integration. Business Process Reengineering (BPR) is supported by CRM, ERP and EAI because it integrates data. CRM, ERP and EAI uses enterprise processes systems to create stronger, faster, more effective linkages in value chains. It is also difficult, slow, exceedingly expensive to support enterprise processes. Key personnel determine how best to use new technology so it requires high-level expensive skills and considerable time. For instance, a business needs to determine how best to change its processes to take advantage of new capability. Enterprise Application Solutions uses inherent processes which can be consider “Industry Best Practices” and is a predesigned process for using application. Organizations can license software and obtain prebuilt procedures. Customer relationship management is the suite of applications, database, set of inherent processes. It also manages all interactions with customer through four phases of customer life cycle. This includes marketing, customer acquisition, relationship management, loss/churn and supports customer-centric organization. The customer life cycle is an application process of a common customer database. This system eliminates duplicated customer data and removes the possibility of inconsistent data. ERP Applications primary purpose is integration and are an IS based on ERP technology. ERP is a database and a set of inherent processes for consolidating business operations into a single, consistent, computing platform. Enterprise Application Integration connects systems, enables communicating and sharing data. It also provides integrated information, integrated layer on top of existing systems while leaving functional applications “as is and enables gradual move to ERP.

Q5: What are the elements of an ERP system?

There are 5 elements to an ERP system, which includes hardware, ERP application programs, ERP databases, business process procedures and consulting. ERP applications integrate supply chains, manufacturing, CRM, human resources and accounting. There are various ERP solution components such as applications and databases. ERP application programs configurable vendor applications compare to ERP databases. Vendor applications can be altered without changing program code. Set configuration parameters specifying how ERP application programs will operate. ERP databases uses a computer program within database to keep database consistent when certain conditions arise. ERP enforces business rules and stores business processes and procedures.

Q6: What are the challenges of implementing and upgrading enterprise information systems?

 There are five challenges to implementing and upgrading enterprise information systems. The challenges are collaborative management, requirement gaps, transition problems, employee resistance and New technology. Also, implementation is challenging, difficult, expensive, and risky. It is not unusual for enterprise system projects to be well over budget and a year or more late.

Q7: How do inter-enterprise IS solve the problems of enterprise silos?

Q8: 2026?

Companies want to move to lower costs of the cloud, but cannot plunge into new cloud-based solutions without causing considerable organizational turmoil, if not failure. Delicate balance between risk of loss and improvement to processes. Machines able to employ ERP system to schedule own maintenance. ERP customers store most of their data on cloud servers managed by cloud vendors and store sensitive data on their own servers