eBusiness Roadmap for success

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e-BusinessRoadmap for success

• Ravi Kalakota and Marcia Robinson

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e-Business framework
ERP
SCM
E-procurement
Selling Chain Management
CRM
Knowledge Management
e-business
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e-Business framework

• e-business and e-commerce are not the same
• e-business affects to the core of the enterprise
• moving to e-business changes the structure and
  processes of a firm radically
• the stakes are high

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From e-commerce to e-business

• Some pioneer firms in US have already moved from
  e-commerce to e-business (Dell, Amazon.com, UPS,
  Cisco)
• streamlined processes
• integrated technology
• new business model
• -gt competitive advantage

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rules of e-business

• Technology is no longer an aftertought in
  forming business strategy, but the actual cause
  and driver
• IT is not part of the business, it is the
  business
• Firms are forced to use new technology or get out
  of the business

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rules of e-business

• Streamlining the structure and information flows
  is much more powerful than moving and
  manufacturing physical products
• More flexible organization structure
• Accelerated flow of information
• Continuing transformation

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rules of e-business

• Inability to overthrow the outdated business
  design often leads to business failure
• New business design must give the ability to
  react quickly on customer demands
• Core competence
• Outsourcing

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rules of e-business

• New business design must create flexible
  outsourcing alliances
• Compatible technology between outsourcing
  partners
• Customers want more speed, better service,
  personalization, and lower price

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rules of e-business

• Company can be the cheapest the most familiar
  or the best to its customers
• The cheapest by being value oriented
• The most familiar with strong branding
• The best with outstanding service and strong
  customer relationship

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rules of e-business

• The tough task is to align business strategies,
  processes and technology at the same time and
  correctly
• Strong leadership is important
• Similarities to managing a company in crisis

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e-business trends

• Speed of service time is money
• Self service easy and quick via WWW
• Integrated solutions all under one roof
• Integration of sales and service
• Consistent and reliable service

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e-business trends

• Contract manufacturing and strong branding
• Outsourcing and core competence
• Process visibility for customers and allies
• Employee retention learning, innovating,
  motivating knowledge workers
• Multichannel integration optimize information
  flows from telephone, fax, www
• Mobile computing and wireless applications

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e-business design

• Important part of the strategy of the firm
• Things to analyze when creating e-business
  strategy
• Use of new technology
• Responsing to new customer expectations
• Ability to make large changes

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e-business design

• Careful planning of e-business design makes its
  execution more likely succesful
• E-commerce technology must be embedded in
  e-business design effectively
• Management must have vision how to answer to
  offering excellence in service, operations or
  continuous innovation

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e-business application architecture

• Enterprise applications form the backbone for
  architecture
• Best possible integration of applications is
  critical but hard to achieve
• IT-infrastructure and business processes must fit
  together

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e-business application architecture

• Clusters of enterprise applications
• Customer Relationship Management (CRM)
• Enterprise Resource Planning (ERP)
• Supply Chain Management (SCM)
• Selling-chain management
• Operating Resource Management
• Enterprise Application Integration
• Business Analytics, Knowledge management

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Customer Relationship Management

• Why CRM?
• Old customers are more profitable
• Dissatisfied customers become expensive
• New customers are hard to get
• CRM integrates sales and service for the needs of
  e-commerce

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Customer Relationship Management

• Using CRM, three phases
• 1) Acquiring new customers
• 2) Enhancing the profitability of customers
• 3) Retaining profitable customers
• All phases are related, but company usually
• has to choose one to be its primary focus

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Customer Relationship Management

• CRM processes must be organized around customer
  not marketing, sales or other internal function
• Organizational structures must fit CRM
• Customer information should be able to flow
  through organization and be available easily

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Customer Relationship Management

• Types of integration in CRM infrastructure
• Customer content
• Customer contact information
• Extended enterprise
• Front-office and back-office systems

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Customer Relationship Management

• Organizational challenges in implementing CRM
• CRM cuts across business units
• From silo-centric infrastructure to
  customer-centric infrastructure
• Issues with global operations

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Selling-chain Management

• Definition Integrated order acquisition strategy
• Selling-chain management tries to answer to
  problems like
• Better support the work of sales people
• Solution to fragmented order support
• Integrated systems, get rid of rekeying orders
• Connect different sales functions

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Selling-chain Management

• Goals in moving from functional sales to
  process-oriented selling-chain management
• Easier ordering for the customer
• Add value for the customer
• Possibility to order custom products
• More effective sales process

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Selling-chain Management

• Case Cisco and selling chain management
• Order taking was integrated into operational
  planning process
• B-to-B commerce via Web
• Faster delivery of customizable products
• 24h a day service and support

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Enterprise Resource Planning

• ERP forms the backbone of E-business
• ERP is a combination of compatible software
  applications
• Top providers SAP, Baan, Peoplesoft, Oracle
• Enhances the internal information flows of the
  organization
• From legacy systems to ERP

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Enterprise Resource Planning
Sales Production Distribution
Planning (Order Entry)
Integrated Logistics
Human Accounting
Resources Financials
Basic elements of a standard ERP-suite
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Enterprise Resource Planning

• Major reasons for popularity of ERP-systems
• Replacing legacy systems
• Greater control
• Managing globalization
• Handling new regulations easier
• Integration of functions across the enterprise

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Enterprise resource planning

• 3 implementation strategies of ERP
• Step by step
• Big bang
• Modified big bang

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Enterprise Resource Planning

• Stakes are high. ERP implementation may lead to
  huge savings or a bankruptcy
• Does not offer competetive advantage for a long
  time
• ERP can help to move resources from supportive
  functions to core competence
• Are firms becoming similar because of ERP ?

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Supply Chain Management

• What is causing the SCM boom?

e-business structural migration Rapid Demand
Fulfillment Internet-Enabled Supply Chain
Planning and execution
e-commerce value proposition Give the customers
what they want,when and how they want,at the
lowest cost
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Supply Chain Management

• SCM is process umbrella
• SCM is coordination of material, information and
  financial flows between and among all the
  participating enterprises
• Goals of SCM is interenterprise integration

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Supply Chain Investment Trends

• Worldwide dispersion of manufacturing and
  distribution facilities
• Channel unpredictability is the norm
• Responsiveness over effiency
• Accept lower margins to maintain and increase
  market share

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Supply Chain Management

• SCM is where the action will be in the next
  decade
• company vs. company supply chain vs. supply
  chain
• enterprise focus ?partner focus ?direct focus
• Service via SCM has become the Holy Grail for
  competitive advantage

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Applications for SCM

• Two categories
• planning and execution
• Planning modules
• Order Commitment
• Advanced Scheduling
• Demand planning
• Distribution Planning

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Applications for SCM

• Execution Modules
• Order Planning
• Production
• Replenishment
• Distribution
• These apps only partial functional solutions
• Need to have Integrated SC Application

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Supply Chain Management

• SCM is a prerequisite to doing business
• SCM is business strategy issues
• Opportunity to differentiate through supply chain
• SCM solutions market is in its infancy.

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E-Procurement

• Procurement is not purchasing
• Close-loop process
• requisition ? payment
• Becoming top-managemnet issue
• Case M Market
• Intranet based desktop ordering system for
  selected partners

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E-procurement chain management

• Next Gen procurement apps
• Buy-side desktop
• Buy-side centralized
• Sell-side apps
• e-procurement solutions
• automate selection
• end-to-end solution
• control of preferred suppliers

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E-procurement chain management

• Verical Procurement Portals

• Professional Buyers
• Control
• Effiency and cost reduction
• Supplier managemnet

Integration Sweet Spot

• Employees
• Convenience
• Ease of Use
• Consistency

• Supplier
• Cost reduction
• Clean orders

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Knowledge-Tone Apps next gen of Decision Support
Systems

• From compiling data to identifying key customer
  trends and preferences
• Employees expect high quality information, 24h
  access and fast performance
• Business of information sorting, extraction,
  packaging and dissemination

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Classes of Knowledge-Tone Apps

• Customer Relationship DSS
• Personalization
• Supply Chain DSS
• Visibility and certainty
• Remote Performance Monitoring
• Monitoring system, KPIs
• SAP Strategic Enterprise Management

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Classes of Knowledge-Tone Apps

• Knowledge Management
• Problems
• Can we define it?
• Software vendors are distancing themselves from
  it
• Low returns on investments
• Simulation What-if Scenario Analysis

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E-business Strategy Creation

• top-down analytical planning
• The never-seen-again plan
• The no-goals plan
• The no-feedback plan
• bottom-up just do it tactical planning
• misinformed decisions

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E-business Strategy Creation

• Continuous planning with feedback
• Knowledge building and capability evaluation
• E-business desing
• E-business blueprint
• Application development and deployment

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E-business design

• Category killer
• Channel reconfiguration
• Transaction intermediary
• Infomediary
• Self-service innovator
• Supply chain innovator
• Channel mastery

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E-business Strategy into Action

• Biggest problem still top level management
  commitment
• Types of e-business projects
• incremental
• breakthrough
• platform