Outsourcing Chapter Nineteen

Oh yeahhh!! It's our final chapter nineteen! Do a dance people!!! Hoorahhh finally! Our last chapter is about Outsourcing in The 21st Century. The chapter is about outsourcing projects, outsourcing benefits and its challenges. It's a really really really really REALLY short one!

Outsourcing Projects

Insourcing (in-house development) is a common approach using the professional expertise within an organization to develop and maintain the organization's information technology systems. Meanwhile outsourcing is an arrangement by which one organization provides a service or services for another organization that chooses not to perform them in-house.

Reasons why companies outsource.

Onshore outsourcing encourage another company within the same country for services.

Nearshore outsourcing contracting an outsourcing arrangement with a company in a nearby country.

Offshore outsourcing uses organization from developing countries to write code and develop systems.

Some of the factors driving outsourcing growth include:

• Core competencies
• Financial savings
• Rapid growth
• Industry changes
• The internet
• Globalization

The Benefits of Outsourcing

• Increased quality and efficiency
• Reduced operating expenses
• Outsourcing non-core processes
• Reduced exposure to risk
• Economies of scale, expertise and best practices
• Access to advanced technologies
• Increased flexibility

Outsourcing Challenges

There are four challenges such as:

1. Contract length ( Difficult in getting out of contract, problems in foreseeing future needs, problems in reforming an internal IT department after the contract is finished)
2. Competitive edge
3. Confidentiality
4. Scope definition

WOW PEOPLE!!! THIS IS THE END OF OUR CHAPTER. THANK YOU SO MUCH FOR READING, I APPRECIATE IT SO MUCH.

Creating Chapter Fifteen

The GIF explains so much about how I feel right now. Hahaha. Well we are nearly nearly NEARLY at the end of the book so take a deep breath and calm down. The fifteenth chapter is about Creating Collaborative Partnerships. This chapter is about the different ways in which companies collaborate using technology, the different categories of  collaboration technologies, the fundamental concepts of a knowledge management system, provide an examples of a content management system along with its business purpose, the advantages of using a workflow management system and how groupware can benefit a business. So enjoy people!!

Teams, Partnerships, and Alliances

Organizations create and use teams, partnerships, and alliances to:

• Undertake new initiatives.
• Address both minor and major problems.
• Capitalize on significant opportunities.

Organizations create teams, partnerships, and alliances both internally with employees and externally with other organizations. Collaboration system supports the work of teams by facilitating the sharing and flow of information.

Organizations form alliances and partnerships with other organizations based on their core competency

Core competency is an organization’s key strength, a business function that it does better than any of its competitors. Core competency strategy is an organization chooses to focus specifically on its core competency and forms partnerships with other organizations to handle nonstrategic business processes.

Information technology can make a business partnership easier to establish and manage Information partnership occurs when two or more organizations cooperate by integrating their IT systems, thereby providing customers with the best of what each can offer. The Internet has dramatically increased the ease and availability for IT-enabled organizational alliances and partnerships.

Collaboration Systems

Collaboration solves specific business tasks such as telecommuting, online meetings, deploying applications, and remote project and sales management. Collaboration system is an IT-based set of tools that supports the work of teams by facilitating the sharing and flow of information. 

Two categories of collaboration are:

• Unstructured collaboration (information collaboration) which includes document exchange, shared whiteboards, discussion forums, and e-mail.
• Structured collaboration (process collaboration) involves shared participation in business processes such as workflow in which knowledge is hardcoded as rules.

Collaboration systems include:

• Knowledge management systems
• Content management systems
• Workflow management systems
• Groupware systems

Knowledge Management Systems

Knowledge management (KM) involves capturing, classifying, evaluating, retrieving, and sharing information assets in a way that provides context for effective decisions and actions. Knowledge management system supports the capturing and use of an organization’s “know-how”. 

Explicit and Tacit Knowledge

Intellectual and knowledge-based assets fall into two categories:

• Explicit knowledge consists of anything that can be documented, archived, and codified, often with the help of IT.
• Tacit knowledge is the knowledge contained in people’s heads.

The following are two best practices for transferring or recreating tacit knowledge:

• Shadowing is the less experienced staff observe more experienced staff to learn how their more experienced counterparts approach their work.
• Joint problem solving is a novice and expert work together on a project.

Reasons why organizations launch knowledge management programs

KM Technologies

Knowledge management systems include:

• Knowledge repositories (databases)
• Expertise tools
• E-learning applications
• Discussion and chat technologies
• Search and data mining tools

KM and Social Networking

Finding out how information flows through an organization. Social networking analysis (SNA) a process of mapping a group’s contacts (whether personal or professional) to identify who knows whom and who works with whom. SNA provides a clear picture of how employees and divisions work together and can help identify key experts.  

Content Management

Content management system (CMS) provides tools to manage the creation, storage, editing, and publication of information in a collaborative environment.

CMS marketplace includes:

• Document management system (DMS)
• Digital asset management system (DAM)
• Web content management system (WCM)

Working Wikis

Wikis is a Web-based tools that make it easy for users to add, remove, and change online content. Business wikis is a collaborative Web pages that allow users to edit documents, share ideas, or monitor the status of a project.

Workflow Management Systems

Work activities can be performed in series or in parallel that involves people and automated computer systems. Workflow defines all the steps or business rules, from beginning to end, required for a business process. Workflow management system facilitates the automation and management of business processes and controls the movement of work through the business process. Messaging-based workflow system sends work assignments through an e-mail system. Database-based workflow system stores documents in a central location and automatically asks the team members to access the document when it is their turn to edit the document. 

Groupware Systems

Groupware technologies

Groupware is a software that supports team interaction and dynamics including calendaring, scheduling, and videoconferencing.

Videoconference is a set of interactive telecommunication technologies that allow two or more locations to interact via two-way video and audio transmissions simultaneously.

Web conferencing is a blends audio, video, and document-sharing technologies to create virtual meeting rooms where people “gather” at a password-protected Web site.

Instant Messaging

E-mail is the dominant form of collaboration application, but real-time collaboration tools like instant messaging are creating a new communication dynamic.

Instant messaging is a type of communications service that enables someone to create a kind of private chat room with another individual to communicate in real-time over the Internet.

Business Chapter Fourteen

Aloha people! We are nearing the end now with only three more chapter including this one. Hooray!! This chapter is called E-Business. We all know or have some idea about what E-Business is all about, I'm sure everyone does. So these are a few things that we will learn about E-Business e-commerce and e-business, the four types of e-business models, the benefits and challenges associated with e-business and the differences among e-shops, e-malls, and online auctions.

What is E-Business?

The Internet is a powerful channel that presents new opportunities for an organization to, touch customers, enrich products and services with information and lastly, reduce costs. If you're wondering how do e-commerce and e-business differ? The answer is E-commerce is the buying and selling of goods and services over the Internet while E-business is the conducting of business on the Internet including, not only buying and selling, but also serving customers and collaborating with business partners. Meanwhile E-business model is an approach to conducting electronic business on the Internet.

Industries that uses E-Business

The E-Business Model

Business-to-Business (B2B)

Electronic marketplace (e-marketplace) is an interactive business communities providing a central market where multiple buyers and sellers can engage in e-business activities.

Business-to-Consumer (B2C)

Common B2C e-business models include:

• e-shop – a version of a retail store where customers can shop at any hour of the day without leaving their home or office.
• e-mall – consists of a number of e-shops; it serves as a gateway through which a visitor can access other e-shops.

Business types:

• Brick-and-mortar business
• Pure-play business
• Click-and-mortar business

Consumer-to-Business (C2B)

The demand for C2B e-business will increase over the next few years due to customer’s desire for greater convenience and lower prices. Example of e-business model is Priceline.com.

Consumer-to-Consumer (C2C)

Online auctions:

-Electronic auction (e-auction) is the sellers and buyers solicit consecutive bids from each other and prices are determined dynamically.

-Forward auction is the sellers use as a selling channel to many buyers and the highest bid wins.

-Reverse auction is when the buyers use to purchase a product or service, selecting the seller with the lowest bid.

Consumer-to-Consumer (C2C)

C2C communities include:

• Communities of interest is the people interact with each other on specific topics, such as golfing and stamp collecting.
• Communities of relations is the people come together to share certain life experiences, such as cancer patients, senior citizens, and car enthusiasts.
• Communities of fantasy is the people participate in imaginary environments, such as fantasy football teams and playing one-on-one with Michael Jordan.

E-Business Benefits and Challenges.

E-Business benefits include:

• Highly accessible 
• Increased customer loyalty
• Improved information content 
• Increased convenience
• Increased global reach 
• Decreased cost 

E-business challenges include:

• Protecting consumers
• Leveraging existing systems
• Increasing liability
• Providing security
• Adhering to taxation rules

There are numerous advantages and limitations in e-business revenue models including: 

• Transaction fees
• License fees
• Subscription fees
• Value-added fees
• Advertising fees

Mashups

Web mashup is a Web site or Web application that uses content from more than one source to create a completely new service. While Application programming interface (API) is a set of routines, protocols, and tools for building software applications. Mashup editor is WSYIWYGs (What You See Is What You Get) for mashups.

Thank you!!

Integrating Chapter Twelve

We are now at chapter twelve, three more chapter till the end of all chapter. Yeay!!! Chapter twelve is about Integrating the Organization from End to End – Enterprise Resource Planning. This chapter consist of the role information plays in enterprise resource planning systems, the primary forces driving the explosive growth of enterprise resource planning systems and the business value of integrating supply chain management, customer relationship management, and enterprise resource planning systems. Enjoy guys!!

Enterprise Resource Planning (ERP)

At the heart of all ERP systems is a database, when a user enters or updates information in one module, it is immediately and automatically updated throughout the entire system. ERP systems automate business processes.

Bringing the Organization Together

The organization before ERP.

Bringing the organization together.

The Evolution of ERP

Integrating SCM, CRM, and ERP

SCM, CRM, and ERP are the backbone of e-business. Integration of these applications is the key to success for many companies. Integration allows the unlocking of information to make it available to any user, anywhere, anytime.

General audience and purpose of SCM, CRM and ERP

Integration Tools

Many companies purchase modules from an ERP vendor, an SCM vendor, and a CRM vendor and must integrate the different modules together. Middleware is several different types of software which sit in the middle of and provide connectivity between two or more software applications. Enterprise application integration (EAI) middleware is packages together commonly used functionality which reduced the time necessary to develop solutions that integrate applications from multiple vendors.

Enterprise Resource Planning (ERP)

ERP systems must integrate various organization processes and be:

• Flexible
• Modular and open
• Comprehensive
• Beyond the company

Enterprise Resource Planning’s Explosive Growth

SAP boasts 20,000 installations and 10 million users worldwide.

ERP solutions are growing because:

• ERP is a logical solution to the mess of incompatible applications that had sprung  up in most businesses
• ERP addresses the need for global information sharing and reporting
• ERP is used to avoid the pain and expense of fixing legacy systems

Thank you for reading! Have a good day!

Building Chapter Eleven

Hi guys! Thanks for still reading my blog, I hope it has been useful. We only have a few chapters left until end of the chapter so bear with me okay? Chapter eleven is about Customer-Centric Organization – Customer Relationship Management. It talks about operational and analytical customer relationship management, the primary forces driving the explosive growth of customer relationship management and the relationship between decision making and analytical customer relationship management.

Customer Relationship Management (CRM)

CRM enables an organization to:

• Provide better customer service
• Make call centers more efficient
• Cross sell products more effectively
• Help sales staff close deals faster
• Simplify marketing and sales processes
• Discover new customers
• Increase customer revenues

Recency, Frequency, and Monetary Value

Organizations can find their most valuable customers through “RFM”, Recency, Frequency, and Monetary value. How recently a customer purchased items (Recency). How frequently a customer purchased items (Frequency). How much a customer spends on each purchase (Monetary Value).

The Evolution of CRM

CRM reporting technology help organizations identify their customers across other applications. CRM analysis technologies help organization segment their customers into categories such as best and worst customers. CRM predicting technologies help organizations make predictions regarding customer behavior such as which customers are at risk of leaving. Three phases in the evolution of CRM include reporting, analyzing, and predicting.

Customer Relationship Management’s Explosive Growth

CRM Business Drivers

Using Analytical CRM to Enhance Decisions

Operational CRM supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers. Analytical CRM supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers.

Customer Relationship Management Success Factors

CRM success factors include:

• Clearly communicate the CRM strategy 
• Define information needs and flows
• Build an integrated view of the customer
• Implement in iterations
• Scalability for organizational growth

Extending Chapter Ten

Hello people! How is your day going? Hope it's all smiles and rainbow! So this blog will be about chapter ten : Extending the Organization – Supply Chain Management. In this topic we will learn about the components of a typical supply chain, the relationship between decision making and supply chain management, changes resulting from advances in IT that are driving supply chains and the best practices for implementing a successful supply chain management system. Hope you enjoy the read.

Supply Chain Management

The average company spends nearly half of every dollar that it earns on production. In the past, companies focused primarily on manufacturing and quality improvements to influence their supply chains.

Some of the basic Supply Chain are:

• Materials flow from suppliers and their “upstream” suppliers at all levels.
• Transformation of materials into semi-finished and finished products through the organization’s own production process.
• Distribution of products to customers and their “downstream” customers at all levels.

Organizations must embrace technologies that can effectively manage supply chains.

Information Technology’s Role in the Supply Chain

IT’s primary role is to create integrations or tight process and information linkages between functions within a firm.

Factors Driving SCM:

Visibility

• Supply chain visibility is the ability to view all areas up and down the supply chain.

• Bullwhip effect occurs when distorted product demand information passes from one entity to the next throughout the supply chain.

Consumer Behavior

• Companies can respond faster and more effectively to consumer demands through supply chain enhances.

• Demand planning software generates demand forecasts using statistical tools and forecasting techniques.

Competition

• Supply chain planning (SCP) software uses advanced mathematical algorithms to improve the flow and efficiency of the supply chain.

• Supply chain execution (SCE) software automates the different steps and stages of the supply chain.

SCP and SCE in the supply chain

Speed

Factors:

Supply Chain Management Success Factors

SCM industry best practices include:

• Make the sale to suppliers
• Wean employees off traditional business practices
• Ensure the SCM system supports the organizational goals
• Deploy in incremental phases and measure and communicate success
• Be future oriented

SCM Success Stories

Numerous decision support systems (DSSs) are being built to assist decision makers in the design and operation of integrated supply chains. DSSs allow managers to examine performance and relationships over the supply chain and among suppliers, manufacturers, distributors and other factors that optimize supply chain performance.

Enabling Chapter Nine

Hey! Aren't you guys excited that we're on our chapter nine already? I know I am!! As for chapter nine, Enabling the Organization (Decision Making), we will learn about the systems organizations use to make decisions and gain competitive advantages, the relationship between digital dashboards and executive information systems, the three quantitative models typically used by decision support systems, three types of data-mining analysis capabilities and last but not least four types of artificial intelligence systems.

Decision Making

Here are some reasons for the growth of decision-making information systems:

• People need to analyze large amounts of information
• People must make decisions quickly
• People must apply sophisticated analysis techniques, such as modeling and forecasting, to make good decisions
• People must protect the corporate asset of organizational information

Meanwhile, Model is a simplified representation or abstraction of reality.

Transaction Processing Systems

Moving up through the organizational pyramid users move from requiring transactional information to analytical information. 

Transaction processing system is the basic business system that serves the operational level (analysts) in an organization . Online transaction processing (OLTP) is the capturing of transaction and event information using technology to (1) process the information according to defined business rules, (2) store the information, (3) update existing information to reflect the new information. While, Online analytical processing (OLAP) is the manipulation of information to create business intelligence in support of strategic decision making.

Decision Support Systems

Decision support system (DSS) is the models information to support managers and business professionals during the decision-making process.

Three quantitative models used by DSSs include:

1. Sensitivity analysis – the study of the impact that changes in one (or more) parts of the model have on other parts of the model.

1. What-if analysis – checks the impact of a change in an assumption on the proposed solution.

1. Goal-seeking analysis – finds the inputs necessary to achieve a goal such as a desired level of output.

The Interaction between a TPS and a DSS are as in the picture.

Executive Information Systems

Executive information system (EIS) is a specialized DSS that supports senior level executives within the organization.

Most EISs offering the following capabilities:

• Consolidation – involves the aggregation of information and features simple roll-ups to complex groupings of interrelated information.
• Drill-down – enables users to get details, and details of details, of information.
• Slice-and-dice – looks at information from different perspectives.

Interaction between a TPS and an EIS is as in the picture.

Digital dashboard is an integrates information from multiple components and presents it in a unified display.

Artificial Intelligence (AI)

Intelligent system is a various commercial applications of artificial intelligence. Artificial intelligence (AI) helps simulates human intelligence such as the ability to reason and learn and the advantage is can check info on competitor. The ultimate goal of AI is the ability to build a system that can mimic human intelligence. 

Four most common categories of AI include:

1. Expert system – computerized advisory programs that imitate the reasoning processes of experts in solving difficult problem.
2. Neural Network – attempts to emulate the way the human brain works.
3. Genetic algorithm – an artificial intelligent system that mimics the evolutionary, survival-of-the-fittest process to generate increasingly better solutions to a problem.
4. Intelligent agent – special-purposed knowledge-based information system that accomplishes specific tasks on behalf of its users.

Data Mining

Data-mining software includes many forms of AI such as neural networks and expert systems. 

Common forms of data-mining analysis capabilities include:

• Cluster analysis

A technique used to divide an information set into mutually exclusive groups such that the members of each group are as close together as possible to one another and the different groups are as far apart as possible. CRM systems depend on cluster analysis to segment customer information and identify behavioral traits.

• Association detection

Association detection reveals the degree to which variables are related and the nature and frequency of these relationships in the information. Market basket analysis, analyzes such items as Web sites and checkout scanner information to detect customers’ buying behavior and predict future behavior by identifying affinities among customers’ choices of products and services.

• Statistical analysis

Statistical analysis performs such functions as information correlations, distributions, calculations, and variance analysis. Forecast is the predictions made on the basis of time-series information. Time-series information is time-stamped information collected at a particular frequency.

You are much appreciated! Thanks a bunch!!

Accessing Chapter Eight

Hello everyone! Our next chapter is chapter eight, Accessing Organizational Information (Data Warehouse). This topic talks about data warehouse and data marts in organization, the multidimensional nature of data warehouses (and data marts) with the two-dimensional nature of databases, the cleanliness of information throughout an organization and the relationship between business intelligence and a data warehouse. Hope you guys enjoy this topic!

Data warehousing.

Data warehouses extend the transformation of data into information. In the 1990’s executives became less concerned with the day-to-day business operations and more concerned with overall business functions. The data warehouse provided the ability to support decision making without disrupting the day-to-day operations.

Data warehouse is a logical collection of information, gathered from many different operational databases that supports business analysis activities and decision-making tasks. The primary purpose of a data warehouse is to aggregate information throughout an organization into a single repository for decision-making purposes.

Meanwhile, Extraction, transformation, and loading (ETL) is a process that extracts information from internal and external databases, transforms the information using a common set of enterprise definitions, and loads the information into a data warehouse. Data mart on the other hand, contains a subset of data warehouse information.

Model of Data Warehouse

Multidimensional Analysis and Data Mining 

Databases contain information in a series of two-dimensional tables. In a data warehouse and data mart, information is multidimensional, it contains layers of columns and rows. Dimension is a particular attribute of information. However a cube is a common term for the representation of multidimensional information.

Data mining is the process of analyzing data to extract information not offered by the raw data alone. To perform data mining users need data-mining tools. Data-mining tool uses a variety of techniques to find patterns and relationships in large volumes of information and infers rules that predict future behavior and guide decision making.

Information Cleansing or Scrubbing 

An organization must maintain high-quality data in the data warehouse. Information cleansing or scrubbing is a process that weeds out and fixes or discards inconsistent, incorrect, or incomplete information. Below is contact information in an operational system, standardizing Customer name from Operational Systems, information cleansing activities and accurate and complete information:

Business Intelligence

Business intelligence is the information that people use to support their decision-making efforts. Principle BI enablers include technology, people and culture.

Storing Chapter Seven

Hello everybody. I haven't update my blog for a while now cause it has been hectic lately. This post will be about the seventh chapter which is Storing Organizational Information. This chapter is about relational database model, integrity constraints, business critical integrity constraints, data driven web site and methods for integrating information across multiple databases.

Information is everywhere in an organization. These information needs to be stored somewhere, and the right place is in a database. A database maintains information about various types of objects (inventory), events (transactions), people (employees) and places (warehouses). Database includes a few models such as hierarchical database model, information is organized into tree-like structure in such a way that it cannot have too many relationships. The second model is network database model, a flexible way of representing objects and their relationships. The last model is relational database model, stores information in the form of logically related two-dimensional tables.

Hierarchical Structure.

Network Structure

Relation Structure.

Entity is a person, place, thing, transaction or event about which information is stored. The rows in each table contain the entities. Meanwhile, attributes (fields, columns) is the characteristics or properties of an entity class. The columns in each table contain the attributes.

Primary keys and foreign keys identify the various entity classes (tables) in the database. Primary key is a field (or a group of fields) that uniquely identifies a given entity in a table. On the other hand, foreign key is a primary key of one table that appears an attribute in another table and acts to provide a logical relationship among the two tables

Potential Relation Database for Coca-Cola.

The advantages from a business perspective include increased flexibility, increased scalability and performance, reduced information redundancy, increased integrity and increased information security.

Database Management Systems (DBMS).

Software which user and application programs interacts with database.

Data Driven Web-Site.

An interactive Web site kept constantly updated and relevant to the needs of its customers through the use of a database.

Advantages of data driven website business are as below: 

• Development
• Content management
• Future expandibility
• Minimizing human error
• Cutting production and updating cost
• More efficient
• Improved stability

Data Driven Intelligence.

Integration allows separate systems to communicate directly with each other.

Forward integration takes information entered into a given system and sends it automatically to all downstream systems and processes.

While backward integration takes information entered into a given system and sends it automatically to all upstream systems and processes.

Integrating information among multiple databases is the concept of building a central repository specifically for integrated information. Without integration, an organization will spend considerable time entering the same info in multiple system and suffer from the low quality and inconsistency typically embedded in redundant info.

Thank you so much for reading! Have an amazing day!!