IT Systems & E-Learning #1: Decision support systems for business processes
IT Systems & E-Learning #2: Obtain Information
IT Systems & E-Learning #3: Analyse Information
IT Systems & E-Learning #4: Make Decisions
IT Systems & E-Learning #5: Enterprise Information Systems

Supply Chain Management Systems

When you see a product on the shelf of a store, it has come a long way to get there. The path of a product from organizing all materials required for the product, over manufacturing the product and shipping the product to the point-of-sale, to being exchanged for money is called a supply chain. The term also includes all the processes, entities, and information associated with that path. We can divide a supply chain path into three stages:

  • Upstream – the procurement of materials, information, or services from suppliers
  • Internal – creating the finished product or service
  • Downstream – distributing the finished product to customers
Supply Chain Stages

Within these stages, we can identify different flows that make up a stream:

  • Material flows, which include the physical objects that are moved along the supply chain.
  • Financial flows, which include monetary and other financial transactions along the supply chain.
  • Information flows, which include all data generated along the supply chain.

A supply chain management (SCM) system is an information system to manage and optimise these three flows. An important feature of SCM systems is that they are not closed systems within a company, but they are connected to the systems of other companies that are part of the supply chain. An SCM system connects to the systems of suppliers to automate the process of procuring materials, on the one side, and connects to the systems of distributors and retailers, on the other side. This integration gives a company more transparency about its supply chain and the opportunity to optimise processes. Using an SCM system for the upstream stage, a company can easily order new supplies, monitor availability and prices of materials from suppliers, and check estimated delivery times. For the downstream stage, a company can receive orders from distributors and retailers instantly, adjust its distribution price effortlessly, and compare performance of different distributors and retailers.

As you can imagine, suppliers, distributors, and retailers may all use completely different information systems built on different foundations. To enable data exchange between different systems, the electronic data interchange (EDI) method was introduced. Before the Internet, EDI was a specific software that would translate documents to be exchanged into a predefined format and relied on dedicated networks to transport this information securely. Nowadays, documents can be formatted by using an open, standardised language such as XML or JSON and transferred through secure Internet channels. More recently, companies are turning to cloud-based SCM systems, where supply chain data is stored in a central place and supply chain partners have direct access.

Customer Relationship Management Systems

A business has many relations to its customers: it sells products to them, it provides customer support, it conducts marketing activities to gain new customers, and it runs loyalty programs to retain existing customers. Customer relationship management (CRM) systems are information systems that support and aim to optimise these activities. Some of the most important applications of CRM systems in organisations are listed in the following.

Sales:
CRM systems allow sales representatives to record their sales activities, their interaction with customers, and customer preferences. Based on this data, a CRM system can optimise cross-selling, up-selling, and bundling of products. Cross-selling is a sales approach that recommends customers additional products related to their previous purchases. Up-selling is a strategy to persuade customers to purchase a higher-valued product than they originally intend to. Bundling refers to selling a combination of products together for a reduced total price.

Marketing:
CRM systems can create detailed profiles from customer data to facilitate targeted marketing campaigns. They also record the responses to campaigns and support analysis of how successful a campaign was.

Account Management:
CRM systems record all important data from each customer contact with the business. A business has many different types of interactions with its customers, called touch points. Touch points include phone calls, email messages, direct mailings, retail shops, promotion stalls, and website visits.

Customer Support:

CRM systems log all support requests made by customers and route requests to the right department. When customers make a support request, the CRM system can automatically show their profiles and their purchase histories so that the request can be resolved in a personalised manner.

Customer Retention:
It is well-known that it is more efficient to keep existing customers than to acquire new ones. CRM systems assist customer retention strategies by identifying the most valuable existing customers. With the help of CRM systems, specialised marketing campaigns and loyalty programs can be established to target these customers.

Enterprise Resource Planning

Enterprise resource planning (ERP) systems are information systems that support routine processes within a business. They integrate the individual transaction processing systems that may be used for different functions and in different departments into one connected system. This gives managers a holistic view on day-to-day business operations that facilitates more informed decision-making on internal processes. Figure 15 gives an illustration of an ERP system as a company’s internal information system and CRM and SCM systems on the periphery connecting to external stakeholders.

Enterprise Information Systems
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