ITC 5301 VI PPP

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Course Learning Outcomes for Unit V Upon completion of this unit, students should be able to:

3. Explain how information technology systems influence organizational strategies. 3.3 Discuss how electronic commerce provides competitive advantages.

5. Critique core information systems applications from a business perspective.

5.4 Explain the value added to organizations by implementing advanced information systems solutions.

Required Unit Resources Chapter 9: Achieving Operational Excellence and Customer Intimacy: Enterprise Applications Chapter 10: E-Commerce: Digital Markets, Digital Goods Unit Lesson

Advanced Information Systems What exactly are advanced information system solutions? Most people who have worked in an office setting have a good understanding of the processes that affect their everyday lives. They understand the data they enter or scan is stored in a database, and certain processes they run may close out a monthly account, process a payroll run, or bill a customer. These types of processes, while they seem separate, are often very integrated. In years past, organizations had large mainframes. These mainframes had to process transactions in batches, usually at night, and until that batch process happened, the screens you were viewing were not always completely correct. For example, you could place an order for a customer, but you might not see the order until the next day. Unfortunately, that also meant that you could not see the inventory reduction until the next day as well. This means that you might place an order, and there might not be any of that item left in stock at the time. A salesperson or customer service representative might have to go look at three or four different screens to get a good picture of the customer’s account health or to research a problem, even with this batching process. Once client-servers came to organizations, you might have to look at two completely different computers to research that same problem. This was commonplace until organizations could get all of their data and processes moved off of those old mainframes. Now that businesses have grown so much, many of them have multiple product lines, systems, servers, and databases. In the past, managers would have to wait for big printouts of various reports to make business decisions. An enterprise resource planning (ERP) system works to integrate all of those critical systems together so they can talk to each other. The applications that make-up the enterprise software are created based on predefined best business practices. For example, when a business purchases a piece of equipment, that order is entered into accounting the same way for all businesses. If a customer makes a purchase, it should generally be handled the same way. When you hire someone, you have the same laws to follow. There may be some customization, but that is handled in the application as well (Laudon & Laudon, 2016). So, from a management perspective, what is the value in enterprise systems?

UNIT V STUDY GUIDE Advanced Information System Solutions and E-Commerce

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This is the question we have to ask ourselves when adopting any sort of information systems solution. We do not just spend a large amount of money on something without understanding the value it offers us as a company. We have discussed the value of data in previous chapters. One of the other reasons enterprise systems bring us value is that they also help us to have firm-wide information to make better decisions.

(Vaeenma, n.d.)

Supply Chain Management (SCM)

Many large organizations such as Walmart and Amazon use SCM to help their organization manage its suppliers and goods more efficiently. If you have thousands of suppliers and hundreds of thousands of orders, it would be impossible to keep up with everything. SCM software can manage all of this and allow for forecasting and decision-making as well. Imagine if many of your suppliers are in other countries; this means you have a global supply chain that is even more complex to manage. The case study “The Coronavirus Pandemic Disrupts Supply Chains Around the World Case Study” in Chapter 9 of your eTextbook provides a good example of the current supply chain problem. According to the Global Health Policy website, the COVID-19 pandemic's impact on the global economy has been significant, with the International Monetary Fund (IMF) estimating that the median global GDP dropped by 3.9% from 2019 to 2020, making it the worst economic downturn since the Great Depression (Oum, Kates, & Wexler, 2022). During the pandemic, social distance and quarantining created spikes in demand for certain products, such as toilet paper and hand sanitizer, and drops in demand for others. Businesses such as retail stores and restaurants are hit especially hard. Port congestion and transportation and delivery service disruptions paralyzed the supply chain worldwide. The problem is that companies do not have visibility into their supply chains. They outsource their products (auto parts, fashion, technology, medical gear, and drug components) to external suppliers with a thin margin of safety stock, thus vulnerable to supply chain disruptions. In addition, many companies do not have supply chain/inventory management systems. Even when they do, they are not sophisticated enough to react to the situation in a timely manner. Intelligence solutions can help organizations in many different ways, such as assisting them to establish interconnected networks of supply chain processes and to manage their supply chains more flexibly. “Gartner, Inc., predicts that by 2023, at least 50 percent of global companies will be using artificial intelligence, advanced analytics, and the Internet of Things (IoT) in supply chain operations” (Laudon & Laudon, 2022, p. 366).

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Customer Relationship Management (CRM) CRM involves managing customers. Again, if you have 50,000 customers, how do you keep up with what they purchased? Sure, you can store that information in a database, but would it be easy to manage those relationships? How would you keep up with the marketing incentives you have offered them? Better yet, what about the marketing incentives that you want them to pass on to their customers?

Systems, Application, and Products (SAP) SAP is a brand of an enterprise resource system. Oracle and Microsoft both have their own brand of an enterprise resource system. While all of these vendors offer very similar base functionalities, each of them compete against each other by bringing their own special capabilities to their enterprise resource system offerings. What are digital markets, and how can e-commerce transform business?

Digital Markets Digital markets are marketplaces where millions of people can exchange a massive amount of information for free. Digital markets are very efficient and flexible, and they cost less for search and transactions, offer lower menu expenses, and can adapt to a dynamically changing marketplace. Digital markets provide opportunities for selling directly to customers, bypassing middlemen, distributors, and other intermediaries. Digital goods are goods that can be delivered over a digital network and include such items as music, videos, software, newspapers, and books. Digital products are relatively inexpensive to produce. For example, digital books do not require paper, ink, binding, screening, or other printing costs. This digital delivery method is presenting challenges to merchants that use the traditional production and delivery of goods.

E-commerce Another type of advanced information system involves e-commerce. The explosion of Internet purchasing is no surprise to anyone, but the technology involved in e-commerce is pretty unique. In the past, retailers had fairly tight control over everything. The options for consumers were not plentiful. Still, word-of-mouth was still prevalent, so a business could suffer if it did not treat its customers well. Now, retailers have invited the world to comment on their websites. Have you ever had a bad experience at a store and wondered if it ever got past the customer service person that you complained to? E-commerce gives retailers global reach that can be an advantage and a disadvantage as well. Advanced information systems have given retailers the ability to allow customers to interact with each other through social media platforms. Retailers can now personalize your viewing experience based on your Internet searches. This type of customer targeting was not possible before more advanced information systems were developed. The case study “Engaging ‘Socially’ with Customers” in your textbook speaks on the evolution of e- commerce. E-commerce evolved from electronic storefronts selling goods online to creating social experiences shared by thousands of people. Social media platforms such as Facebook, Instagram, Twitter, and Snapchat create perfect environments to engage consumers, advertise products and services and discover trends and influencers. Companies gather information about their users to provide a more personalized experience via still imagery, animated imagery, and videos that might interest them. They have discovered that different social media platforms attract different audiences, so they use Instagram to appeal to a young audiences and Facebook to attract older ones. Nike, one of the most popular Instagram business brands with over 86 million followers, uses Instagram to promote their products as a lifestyle successfully. NBC Sports has over 50 channels for connecting with their 20 million primetime viewers socially on Instagram, Facebook, Twitter, Vine, Snapchat, and Pinterest. Would any of this be possible without advanced information system solutions? What do you think the future holds for information systems and technology as businesses grow bigger and bigger?

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References Laudon, K. C., & Laudon, J. L. (2016). Management information systems: Managing the digital firm (14th ed.).

Pearson. Laudon, K. C., & Laudon, J. L. (2022). Management information systems: Managing the digital firm (17th ed.).

Pearson. Oum, S., Kates, J., & Wexler, A. (2022). Economic impact of COVID-19 on PEPFAR countries.

https://www.kff.org/global-health-policy/issue-brief/economic-impact-of-covid-19-on-pepfar- countries/#:~:text=The%20toll%20the%20COVID%2D19,downturn%20since%20the%20Great%20De pression

Vaeenma. (n.d.). ID 85647109 [Graphic]. Dreamstime. https://www.dreamstime.com/stock-photo-benefits-

enterprise-systems-presenting-image85647109 Suggested Unit Resources In order to access the following resources, click the links below. To reinforce the concepts from this unit, you are encouraged to review the following:

• Chapter 9 PowerPoint Presentation (PDF for Chapter 9 PowerPoint presentation)

• Chapter 10 PowerPoint Presentation (PDF for Chapter 10 PowerPoint presentation)

The following video cases mentioned in your eTextbook augment the information presented in the assigned chapter readings. You are encouraged to review the Chapter 9 and 10 video cases linked below. A transcript can be accessed for each video within the YouTube player by clicking on the three dots below the video title on the right. Closed-captioning can be turned on by clicking the “cc” icon at the bottom of each video. Teradata. (2016, November 4). Maersk line: Global supply chain overhaul [Video]. YouTube.

https://www.youtube.com/watch?v=KEC5DQqCykI CNBC. (2016, August 8). Wal-Mart to acquire Jet.com for $3.3B | Tech Bet | CNBC [Video]. YouTube.

https://www.youtube.com/watch?v=WxQXvmnfCaw