MIS 524 1

Enterprise Computing

An Introduction

MIS 524 2

Agenda

What Is Enterprise Computing?Why Is It Important?What Makes It Difficult?AlternativesImpact on Management

MIS 524 3

Definition

The adoption of an integrated, comprehensive set of applications that communicate easily with one another to handle all of a firm’s business

MIS 524 4

Basic Philosophy

Division of labor, basis of bureaucracy isn’t whole story

Business is an integrated, tightly cohesive system

Structure follows form follows function follows information!

Redundancy, duplication are badVariety is the enemy

MIS 524 5

Typically, corporate IT use is …

SalesPOS

System

ProductionSystem

AccountsReceivable

FinanceSpreadsheet

Sales MgmtSoftware

ProductionMgmt

Application

AccountingSystem

DebtManagementApplication

Sales EISProduction

DSSCorporate

AccountabilityFinance

ESS

Man

agem

ent

Leve

l

Division, Function, Responsibility

MIS 524 6

Fragmented, Fractured…

SalesPOS

System

ProductionSystem

AccountsReceivable

FinanceSpreadsheet

Sales MgmtSoftware

ProductionMgmt

Application

AccountingSystem

DebtManagementApplication

Sales EISProduction

DSSCorporate

AccountabilityFinance

ESS

Man

agem

ent

Leve

l

Division, Function, Responsibility

No communication across functions

No

ag

gre

gat

ion

or

dis

sem

inat

ion

acr

oss

lev

els

of

resp

on

sib

ilit

y

MIS 524 7

Integration Proceeds in Two Dimensions

SalesPOS

System

ProductionSystem

AccountsReceivable

FinanceSpreadsheet

Sales MgmtSoftware

ProductionMgmt

Application

AccountingSystem

DebtManagementApplication

Sales EISProduction

DSSCorporate

AccountabilityFinance

ESS

Division, Function, Responsibility

Common data formats, real-time data processing, client-server platforms, and Internet-based extranets enable data to move “seamlessly” across divisional boundaries, lubricating the movement of semi-finished inventory, product, etc. One barrier to integration is removed.

Common user interfaces enable better communication and movement of human resources among divisions

1. Cross-Functional

MIS 524 8

Typically, corporate IT use is …

SalesPOS

System

ProductionSystem

AccountsReceivable

FinanceSpreadsheet

Sales MgmtSoftware

ProductionMgmt

Application

AccountingSystem

DebtManagementApplication

Sales EISProduction

DSSCorporate

AccountabilityFinance

ESS

Man

agem

ent

Leve

l

Central repositories, common formats, real-time processing, updated security, mobile technologies enable executives, managers, supervisors and workers at all levels to create, access, use, and update information according to their needs.

2. Vertical-ly Integra-

ted

MIS 524 9

Result?

Sales datageneratedfrom POS

Available to SalesManagers to forecast

demand

And to productionstations forschedule generation

And to productionmanagement to monitorproductivity, anticipate

problems

And to CFO to updateinformation for loan

repayment, renegotiation

And to customers to estimate deliverytime, options, etc.

Extra-net

And to all em-ployees to keepthem informedabout working

conditions

Intra-

net

MIS 524 10

Why Is EC Important

Integrates the supply chainProvides for organizational learningIntroduces strong IT efficiencies through

common approachesSolves management problems of

burgeoning IT costs (consolidation)Recognizes IT’s central role in integration,

lubrication of business processes

MIS 524 11

What Makes It Difficult?

Sheer volume of dataDivisional loreActual divisions of laborHuman nature (undesirability of change)Poorly thought-through problem statementHigh initial costLegacy systems, sunk costsNear-monopoly supplier situation (SAP, Bahn,

Peoplesoft, Oracle are really only suppliers)

MIS 524 12

In addition…

Basic philosophy may be a crock Systems aren’t tightly cohesive in most cases Bureaucracy, status really matter Integrated systems are very brittle Most system lore is hidden and what can be

discovered is often not actually the way business is performed

Variety is useful; uniformity may be the enemy

MIS 524 13

Alternatives

Database integration without application integration

Common GUI standards without common screens

Strong “middleware” that interprets from level to level and from application to application

Muddling along

MIS 524 14

Impact on Management

Enterprise computing without business process reengineering may result in the integration of many bad processes

ERP (Enterprise resource planning) should be based on supply chain needs rather than merely efficiency or cost saving

Going with a single supplier is dangerous; it’s also hard to integrate “outside” or third-party software vendors.