Chapter 2

Global E-Business and Collaboration

A Payroll TPS
BUSINESS PROCESSES AND INFORMATION SYSTEMS

Business processes
A TPS for payroll processing captures employee payment
➢ Workflows of material, information, knowledge transaction data (such as a time card). System outputs
➢ Sets of activities, steps include online and hard-copy reports for management
➢ May be tied to functional area or be cross-functional and employee paychecks.

Businesses Management information systems

✓ Serve middle management
➢ Can be seen as collection of business processes\ ✓ Provide reports on the firm’s current performance,
➢ Business processes may be assets or liabilities based on data from TPS
✓ Provide answers to routine questions with predefined
Examples of functional business processes
procedure for answering them
✓ Manufacturing and production ✓ Typically have little analytic capability
Assembling the product, evaluating the product for
quality
How Management Information Systems Obtain Their Data
✓ Sales and marketing
from the Organization’s TPS
Identifying customers, selling the product
✓ Finance and accounting
Creating financial statements, paying creditors
✓ Human resources
Hiring employees, evaluating job performance

The Order Fulfillment Process

FIGURE 2-3. In the system illustrated by this diagram, three TPS

supply summarized transaction data to the MIS reporting system
at the end of the time period. Managers gain access to the
organizational data through the MIS, which provides them with
the appropriate reports.

Decision support systems

✓ Serve middle management
✓ Support non-routine decision making
o Example: What is the impact on the
Figure 2 – 1: Fulfilling a customer order involves a complex set of production schedule if December sales
steps that requires the close coordination of the sale, doubled?
accounting and manufacturing functions. ✓ Often use internal information as well from TPS and MIS
✓ Model driven DSS
o Voyage-estimating systems
✓ Data Driven DSS
Information technology enhances business processes in two
o Intrawest’s marketing analysis systems
main ways
Voyage-Estimating Decision Support System
1. Increasing efficiency of existing processes
o Automating steps that were manual MIS receive data from an organization’s TPS systems and create
outputs that management can use to make strategic decisions.
2. Enabling entirely new processes that are capable of
transforming the businesses Business intelligence
o Change flow of information ✓ Class of software applications
o Replace sequential steps with parallel steps ✓ Analyze current and historical data to find patterns
o Eliminate delays in decision making and trends and aid decision-making

TYPES OF INFORMATION SYSTEMS

Transaction processing systems

✓ Perform and record daily routine transactions
necessary to conduct business
o Examples: sales order entry, payroll, shipping
✓ Allow managers to monitor status of operations and
relations with external environment
✓ Serve operational levels
✓ Serve predefined, structured goals and decision
making
 ✓ Used in systems that support middle and senior applications are used to ensure that TPS, MIS, DSS, and ESS work
management together smoothly.
o Data-driven DSS
o Executive support systems (ESS) Enterprise systems
✓ Collects data from different firm functions and stores
This slide emphasizes the relationship between the class of data in single central data repository
software called “business intelligence” and the decision- ✓ Resolves problem of fragmented, redundant data sets
support systems used by middle and senior management, DSS and systems
and ESS. Business intelligence is a type of software used in ✓ Enable:
analyzing data and is used in both DSS and ES. As an example, o Coordination of daily activities
the BMW Oracle boat described in the chapter opening case o Efficient response to customer orders
was using business intelligence – the software analyzed huge (production, inventory)
amounts of data, including real-time data, to determine hidden o Provide valuable information for improving
factors and correlations that make a sailboat go faster, and management decision making
help the sailors make decisions in navigating and managing the
boat. This slide emphasizes the singularity of enterprise systems (one
system) that integrates information flows from a variety of
Executive support systems sources and serves a wide variety of groups and purposes in the
✓ Support senior management firm. Remind students of the difference between enterprise
✓ Address non-routine decisions applications and enterprise systems: Enterprise applications are
o Requiring judgment, evaluation, and insight any applications that span the enterprise, and types of
✓ Incorporate data about external events (e.g. new tax enterprise applications include CRM, SCM, KMS and enterprise
laws or competitors) as well as summarize information systems. Enterprise systems refer to the larger database
from internal MIS and DSS environment within which these applications reside and
✓ Example: Digital dashboard with real-time view of operate. Note that enterprise systems are referred to in some
firm’s financial performance: working capital, first as “enterprise resource planning systems (ERP).
accounts receivable, accounts payable, cash flow,
and inventory Supply chain management (SCM) systems
✓ Manage firm relationships with suppliers
Emphasize the connection between ESS, MIS, and DSS. ESS rely ✓ Share information about
on accurate inputs from a firm’s MIS and DSS to provide useful o Orders, production, inventory levels, delivery
information to executives. These systems should not exist in of products and service
isolation from one another. If they are isolated from each other, ✓ Goal:
it is a kind of organizational dysfunction, probably inherited from o Right amount of products to destination with
the past. Note that the digital dashboard is a common feature least amount of time and lowest cost
of modern-day ESS. A critical feature of ESS is ease of use and
simplicity of display. Executives using an ESS want quick access Emphasize that SCM systems are inter-organizational systems,
to the most critical data affecting their firm. automating the flow of information across organizational
boundaries. This distinction is important because SCM systems
Systems from a constituency perspective must be designed with the business processes of potential
✓ Transaction processing systems: supporting partners and suppliers in mind.
operational level employees
✓ Management information systems and decision- Customer relationship management systems
support systems: supporting managers ✓ Provide information to coordinate all of the business
✓ Executive support systems: supporting executive processes that deal with customers in sales, marketing,
and service to optimize revenue, customer
Relationship of systems to one another satisfaction, and customer retention
✓ TPS: Major source of data for other systems ✓ Integrate firm’s customer-related processes and
✓ ESS: Recipient of data from lower-level systems consolidate customer information from multiple
✓ Data may be exchanged between systems communication channels
✓ In reality, most businesses’ systems are only loosely
integrated (but they are getting better!) Knowledge management systems (KMS)
✓ Support processes for acquiring, creating, storing,
Enterprise applications distributing, applying, integrating knowledge
✓ Systems for linking the enterprise o How to create, produce, distribute products
✓ Span functional areas and services
✓ Execute business processes across firm ✓ Collect internal knowledge and experience within the
✓ Include all levels of management firm and make it available to employees
✓ Four major applications: ✓ Link to external sources of knowledge
1. Enterprise systems
2. Supply chain management systems Alternative tools that increase integration and
3. Customer relationship management systems expedite the flow of information
4. Knowledge management systems ✓ Intranets
o Internal company Web sites accessible only
by employees
Enterprise Application Architecture ✓ Extranets
o Company Web sites are accessible
Enterprise applications automate externally only to vendors and suppliers
processes that span multiple o Often used to coordinate supply chain
business functions and organizational
levels and may extend outside the E-business
organization. Use of digital technology and Internet to drive major
business processes
Enterprise applications are
used to manage the E-commerce
information used in the ✓ Subset of e-business
systems discussed previously. ✓ Buying and selling goods and services through
In other words, enterprise Internet
 E-government needed: Collaboration capability (including how much
✓ Using Internet technology to deliver information and collaboration is possible) and collaboration technology or
services to citizens, employees, and businesses means. The quality of these two factors directly affects firm
performance – the higher quality of collaboration means better
The use of Internet technology has transformed and continues firm performance. Ask students how collaboration can be high
to transform businesses and business activity. This slide aims to or low quality? An example of low-quality collaboration could
distinguish the different terminology used in the book. E- be a team put together to solve a business problem but is
business refers to the use of the Internet and networking to unable to effectively work together because of internal politics.
enable all parts of the business, while e-commerce refers to just Have students had any experience of poor collaboration?
that part of business that involves selling goods and services
over the Internet. Internet technology has also brought similar Building a collaborative culture and business
changes in the public sector – the use of Internet and processes
networking technologies in government is referred to as e- ✓ “Command and control” organizations
government. o No value placed on teamwork or lower-level
participation in decisions
✓ Collaborative business culture
o Senior managers rely on teams of employees
SYSTEMS FOR COLLABORATION AND TEAMWORK o Policies, products, designs, processes,
systems rely on teams
Collaboration:
o Managers’ purpose is to build teams
✓ Short-lived or long-term
Collaboration is not something that spontaneously arises – it
✓ Informal or formal (teams)
must be enabled and nurtured. Collaborative culture is an
Growing importance of collaboration: essential factor – simply having collaborative technology will
not result in collaboration if it isn’t seen as part of the business
✓ Changing nature of work and rewarded. Have any students worked at “command and
✓ Growth of professional work – “interaction jobs” control” organizations? If so, were they able to see aspects of
✓ Changing organization of the firm the business that could be improved but were unable to make
✓ Changing scope of the firm contributions because of the firm’s culture? Are there any
✓ Emphasis on innovation businesses or business functions that benefit by less
✓ Changing culture of work collaboration? Are there any disadvantages to collaboration?

A number of factors are leading to a growing emphasis on Technology for collaboration and teamwork
collaboration in the firm. Work is changing, requiring more ✓ 15 categories of collaborative software tools
cooperation and coordination. Professions play a larger role in o Email and instant messaging
firms than before, and this often requires more consultation o White boarding
among experts than before. Organizations are flatter, with o Collaborative writing
many more decisions made far down in the hierarchy. o Web presenting
Organizations are more far flung around the globe, in multiple o Collaborative reviewing
locations. There’s an emphasis on finding and sharing ideas o Work scheduling
which requires collaboration. Finally, what it means to be a o Event scheduling
“good” employee these days is in part an ability to work with o Document sharing /wikis
others and collaborate effectively. The culture of work has o File sharing
changed. o Mind mapping
o Screen sharing
Business benefits of collaboration and teamwork o Large audience Webinars
✓ Investments in collaboration technology can produce o Audio conferencing
organizational improvements returning high ROI o Co-browsing
✓ Benefits: o Video Conferencing
o Productivity
o Quality Technology for collaboration and teamwork (cont.)
o Innovation ✓ Social Networking
o Customer service ✓ Wikis
o Financial performance ✓ Virtual Worlds
▪ Profitability, sales, sales growth ✓ Internet-Based Collaboration Environments
o Virtual meeting systems (telepresence)
Requirements for Collaboration o Google Apps/Google sites
o Microsoft SharePoint
o Lotus Notes

The text goes into more depth on each of these tools. Give an
example for each type of tool. A business use of social
networking is Facebook accounts for businesses, using wiki’ as
extended, more complete FAQs, and virtual worlds to conduct
online meetings for employees around the world. Distinguishing
these individual tools from Internet-based collaboration
environments, which are suites of collected collaboration tools,
enabling communication and data-sharing between tools.

Two (2) dimensions of collaboration technologies

1. Space (or location) – remote or collocated
2. Time – synchronous or asynchronous
Figure 2 – 7. Successful collaboration requires an appropriate
organizational structure and culture, along with appropriate Six (6) steps in evaluating software tools
collaboration technology. 1. What are your firm’s collaboration challenges?
2. What kinds of solutions are available?
This slide graphically describes how collaboration is believed to 3. Analyze available products’ cost and benefits
impact business performance. Two primary ingredients are 4. Evaluate security risk
 5. Consult users for implementation and training concern – being able to use IT efficiently and effectively has
issues] become more and more essential to a business’ success.
6. Evaluate product vendors

When evaluating collaboration tools for your businesses, the first

step is to identify the kind of problem you have. The key
problems are time and location. Generally, no one has enough
time and often key people are not in the right place. Some
teams may need to work together in real-time, while others may
simply need shared documentation. In analyzing collaboration
tools by the space/time dimensions you can determine what
types of tools will solve your problem. The six steps in evaluating
software is applicable not only for collaboration tools but any
software solution for your company. First determine the
challenge or problem, look for solutions for this particular
problem and so forth.

The Time/Space Collaboration Tool Matrix

Figure 2 – 8. Collaboration technologies can be classified in

terms of whether they support interactions at the same or
different time or place whether these interactions are remote or
co-located.

Information systems department:

✓ Formal organizational unit responsible for information
technology services
✓ Often headed by chief information officer (CIO)
o Other senior positions include chief security
officer (CSO), chief knowledge officer
(CKO), chief privacy officer (CPO)
✓ Programmers
✓ Systems analysts
✓ Information systems managers

Defined simply, the information systems department of a firm is

responsible for coordinating all of the systems previously
mentioned in this chapter. How the department is organized
depends on the nature and size of the business. Small
companies may not have a formal department, while large
companies may have several departments for different
business functions, or they have an IT Department in each
corporate division. Ask students what types of information
systems departments they have had experience with.

End users
✓ Representatives of other departments for whom
applications are developed
✓ Increasing role in system design, development
✓
IT Governance
✓ Strategies and policies for using IT in the organization
✓ Decision rights
✓ Accountability
✓ Organization of information systems function
✓ Centralized, decentralized, etc.

As the development of business information systems matures,

end users have been increasingly recognized as pivotal to
developing a successful system. In addition, the information
systems department has also been recognized as a powerful
resource for developing new products, services and
efficiencies. As such, IT governance is a central business