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What is Information Technology? Combination of computer and communication technology Computer Technology programmable, multiuse machine that accepts data and processes it into usable information Used to speed up problem solving and increase productivity. Examples of IT- Image Morphing, Video conferencing, GPS tracking What is a Network? Communications system connecting two or more computers with/without wires Cyberspace Encompasses the whole wired and wireless world of communications Mainframes Used in large organizations, Handle thousands of users, Users access through a terminal Processing Conversion of Data into Information Data The raw facts and figures that are processed into information Information Data that has been summarized or otherwise manipulated for use in decision making

Information Systems An information system (IS) is typically considered to be a set of interrelated elements or components that collect (input), manipulate (processes), and disseminate (output) data and information and provide a feedback mechanism to meet an objective. What Is a System? System: A set of components that work together to achieve a common goal Subsystem: One part of a system where the output of more than one system are combined to reach an ultimate goal Closed system: Stand-alone system that has no contact with other systems Open system: System that interfaces with other systems Stages of data processing. The Four Stages of Data Processing Input: Data is collected and entered into computer. Data processing: Data is manipulated into information using mathematical, statistical, and other tools. Output: Information is displayed or presented. Storage: Data and information are maintained for later use.

Benefits of IS Operational Efficiency, Functional Effectiveness, Quality Customer Service, Product Development, Identifying Business Opportunities, Client Lock-in/ Competitor Lock-out, Inter-Organizational Systems and Electronic Markets. Operations Support System i) Transaction processing systems Process business exchanges Maintain records about the exchanges Handle routine, yet critical, tasks Perform simple calculations

ii) Process control systems monitor and control industrial processes. iii) Office automation systems automate office procedures and enhance office communications and productivity. Management support systems provide information and support needed for effective decision making by managers i. Management information systems

Routine information for routine decisions Operational efficiency Use transaction data as main input Databases integrate MIS in different functional areas

ii) Decision Support System Interactive support for non-routine decisions or problems End-users are more involved in creating a DSS than an MIS

iii) Executive information systems provide critical information tailored to the information needs of executives Other categories a) Expert Systems are knowledge-based systems that provides expert advice and act as expert consultants to the users b) End user computing systems support the direct, hands on use of computers by end users for operational and managerial applications c) Business information systems support the operational and managerial applications of the basic business functions of a firm d) Strategic information systems provide a firm which strategic products, services, and capabilities for competitive advantage Challenges in IS 1. Workforce downsizing 2. Information overload 3. Employee mistrust 4. Difficult to built 5. Security breaches

Management information system (MIS) An MIS provides managers with information and support for effective decision making, and provides feedback on daily operations Output, or reports, is usually generated through accumulation of transaction processing data Each MIS is an integrated collection of subsystems, which are typically organized along functional lines within an organization

Outputs of MIS Scheduled reports: Produced periodically, or on a schedule (daily, weekly, monthly)

Key-indicator report: Summarizes the previous days critical activities, typically available at the beginning of each day Demand report: Gives certain information at a managers request Exception report: Automatically produced when a situation is unusual or requires management action Characteristics of a Management Information System Provides reports with fixed and standard formats, Hard-copy and softcopy reports, Uses internal data stored in the computer system, End users can develop custom reports, requires formal requests from users Management Information Systems for Competitive Advantage Provides support to managers as they work to achieve corporate goals, Enables managers to compare results to established company goals and identify problem areas and opportunities for improvement

Inputs to the Financial Information System Strategic plan or corporate policies: Contains major financial objectives and often projects financial needs. Transaction processing system (TPS): Important financial information collected from almost every TPS - payroll, inventory control, order processing, accounts payable, accounts receivable, general ledger. Annual reports and financial statements of competitors and general news items.

Financial MIS Subsystems and Outputs Financial subsystems Profit/loss and cost systems, Auditing, Internal auditing, external auditing, Uses and management of funds Inputs to the Manufacturing MIS Strategic plan or corporate policies. The TPS: Order processing, Inventory data, Receiving and inspecting data, Personnel data, Production process, External sources Manufacturing MIS Subsystems and Outputs Design and engineering, Master production scheduling, Inventory control, Manufacturing resource planning, Just-in-time inventory and manufacturing, Process control, Computer-integrated manufacturing (CIM), Quality control and testing Decision Support System: a system providing both problem-solving and communications capabilities for semi structured problems. These aids have the potential to improve decision making by suggesting solutions that are better than those made by the human alone.

Simons types of decisions Programmed Nonprogrammed Characteristics of a DSS Handles large amounts of data from different sources, Provides report and presentation flexibility, Offers both textual and graphical

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orientation, Supports drill down analysis, Performs complex, sophisticated analysis and comparisons using advanced software packages, Supports optimization, satisfying, and heuristic approaches Web-based decision support systems: Decision support system software provides business intelligence through web browser clients that access databases either through the Internet or a corporate intranet Alters DSS Types The least degree of problem-solving support comes from retrieval of information elements More support comes from retrieving information files Still more support comes from reports from multiple files Even more support from systems that can estimate decision consequences More support from systems that can propose decisions And the most support comes from systems that can make decisions

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Peter Keen Believes That a DSS Should: 1. 2. 3. Assist in solving semi structured problems Support, not replace, the manager Contribute to decision effectiveness, rather than efficiency

Group Decision Support Systems: a computer-based system that supports groups of people engaged in a common task (or goal) and that provides an interface to a shared environment. GDSS is used in problem solving Electronic meeting system (EMS) is used for group interaction of all kinds. Example JAD session.

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Stages of Decision Making (From Herbert Simon) Intelligence (in the military sense of gathering information) Design (Identifying the alternatives, structuring how the decision will be made) Choice (Picking an alternative or making the judgment) [Implementation later added by other authors] [Evaluation] Structured decision stage means that there is an algorithm, mathematical formula, or decision rule to accomplish the entire stage. The algorithm can be implemented manually or it can be computerized, but the steps are so detailed that no little or no human judgment would be needed. Any decision stage that is not structured is unstructured. Types of problems Structured: situations where the procedures to follow when a decision is needed can be specified in advance Repetitive Standard solution methods exist Complete automation may be feasible Unstructured: decision situations where it is not possible to specify in advance most of the decision procedures to follow One-time No standard solutions

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Rely on judgment Automation is usually infeasible Semi-structured: decision procedures that can be pre specified, but not enough to lead to a definite recommended decision Some elements and/or phases of decision making process have repetitive elements Why DSS? Increasing complexity of decisions Technology Information: Data, data everywhere, and not the time to think! Number and complexity of options Pace of change Increasing availability of computerized support Inexpensive high-powered computing Better software More efficient software development process Increasing usability of computers

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Benefits of DSS Decision quality, improved communication, cost reduction, increased productivity, time savings, improved customer and employee satisfaction A data-driven DSS or data-oriented DSS emphasizes access to and manipulation of a time series of internal company data and, sometimes, external data. A communication-driven DSS use network and communication technologies to facilitate collaboration on decision making. It supports more than one person working on a shared task. A document-driven DSS uses storage and processing technologies to document retrieval and analysis. It manages, retrieves and manipulates unstructured information in a variety of electronic formats. A knowledge-driven DSS provides specialized problem solving expertise stored as facts, rules, procedures, or in similar structures. It suggests or recommends actions to managers. Architecture The Data Management Component stores information (which can be further subdivided into that derived from an organization's traditional data repositories, from external sources such as the Internet, or from the personal insights and experiences of individual users) DBMS The Model Management Component handles representations of events, facts, or situations (using various kinds of models, two examples being optimization models and goal-seeking models) MBMS The User Interface Management Component is of course the component that allows a user to interact with the system. DGMS

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DBMS Collection of interrelated data, Set of programs to access the data Database Applications: Banking: all transactions Airlines: reservations, schedules Universities: registration, grades Sales: customers, products, purchases Manufacturing: production, inventory, orders, supply chain Human resources: employee records, salaries, tax deductions Drawbacks of using file systems to store data Data redundancy and inconsistency Difficulty in accessing data Data isolation multiple files and formats Integrity problems Atomicity of updates Concurrent access by multiple users Security problems Database systems offer solutions to all the above problems Functions of a DBMS are concerned with providing efficient flexible data processing capabilities without compromising data validity.

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Main Functions are: Shared data, Control redundancy, Data integrity, Data security ACID Properties It is requires that a DBMS maintain the following properties of transactions: Atomicity: All or nothing execution. Consistency: Execution of transaction results in consistent database. Isolation: Many transactions may execute concurrently but each is unaware of the others. Durability: Persistence. Entity: An entity is a person, place, thing or event that we want to store information about. (It is like a noun.) Entities are the basic unit in modeling classes of concrete or abstract objects. Attribute: An attribute is a characteristic of an entity that we need to store. An attribute is represented as a column in the table for the entity. It is also called a field. An attribute has a specific datatype. Domain: A domain is a description of the legitimate values for an attribute. It is the set of all possible values for that attribute. Key: A key is a single attribute or combination of two or more attributes of an entity set that is used to identify one or more instances of the set. Primary Key: A primary key is an attribute that uniquely identifies each row in the table. Example Employee Number, Student Enrollment Number, Bank Account Number etc.

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Foreign key: A Foreign Key is an attribute in a child table that matches the primary key values in the parent table. Candidate Key: A candidate key is a key that is made up of more than one attribute that uniquely identify an instance of an entity set. In such a case only one of the candidate key will be used as the primary key. The remaining candidate keys would be considered alternate keys. Secondary Key: A secondary key is an attribute or combination of attributes that may not be a candidate key but that classifies the entity set on a particular characteristics. Schema: Schema refers to the logical model of the database. It is a framework into which the values of the data item can be fitted. Logical Data: The term logical structure of the data refers to the way the programmer or the application user perceives it. Physical Data: The physical structure of data refers to the way data are actually recorded in the storage medium. Database Management System Facilities Two main types of facilities are supported by the DBMS: 1) Data Definition Language (DDL) 2) Data Manipulation language (DML Data Definition Language: DDL is used to define conceptual schema and also give some details about how to implement this schema in the physical devices used to store the data. This definition includes all the entity sets and their associated attributes as well as the relationships the entity sets. The definition also includes any constraints that have to be maintained. These definitions, which can be described as metadata about the data in the database are expressed in the DDL of the DBMS and

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maintained in a compiled form. The compiled form of the definitions is known as data dictionary, directory or system catalogue. Data manipulation Language: DML is a language that enables users to access or manipulate data in the database. Data manipulation involves retrieval of data from the database, insertion of new data into the database, and deletion or modification of existing data. The subset of the DML used to pose a query is known as a query language. A query is a statement in the DML that requests the retrieval of data from the database. The various commands provided to insert, update, select, and delete records could be used in an interactive mode or embedded in conventional programming languages. Elements Of A DBMS The major components of a DBMS are: DML Precompiler: It converts DML statement embedded in an application program to normal procedure calls in the host language. The precompiler must interact with the query processor in order to generate the appropriate code. DDL Compiler: It converts the data definition statements into a set of tables. These tables contain information concerning the database and are in a form that can be used by other components of the DBMS. File Manager: Responsibility for the structure of the files and managing the file space rests with the file manager. File manager manages the allocation of space on disk storage and the data structure used represent information stored on disk. Database Manager: A database manager is a program module which provides the interface between the low level data stored in the database and the application programs and queries submitted to the system. It is responsible for interfacing with the file system. One of the functions of database manager is to convert users queries coming directly via the

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query processor or indirectly via an application program from the users logical view to the physical file system. In addition, the task of enforcing constraints and security are also performed by database manager. Synchronizing the simultaneous operations performed by concurrent users is under the control of the database manager. Query Processor: The query processor is used to interpret the online user query and convert it into the efficient series of operations in a form capable of being sent to the data manager for execution. The query processor uses the data dictionary to find the structure of the relevant portion of the database and uses this information in modifying the query and preparing an optimal plan to access the database. Database Administrator: Centralized control of database is exerted by a person who is referred as database administrator. They are the users who are responsible for creating modifying and maintaining its three levels. The functions of DBA are: 1) Schema definition 2) Storage structure and access method definition 3) Schema and physical organization modification 4) Granting of authorization for data access 5) Integrity Constraint specification 6) Defining procedures to recover the database from failures Data Dictionary: Information pertaining to the structure and usage of data contained in the database, the metadata, is maintained in the data dictionary. A data dictionary would provide the definition of data item, how they fit into the data structure and how they relate to other entities in the database. The DBA uses the data dictionary in every phase of a database life cycle starting from the data gathering phase to the design , implementation and maintenance phase.

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Database Advantages Program-data independence Minimal data redundancy Improved data consistency Improved data sharing Increased throughput of application development Enforcement of standards Improved data quality

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Improved data accessibility and responsiveness Reduced program maintenance Database Disadvantages DBMS are more vulnerable than file-based system because of the centralised nature of a large integrated database. If a failure occurs the recovery process is more complex and some times may results in lost transactions. Hardware, software and personnel cost are higher for DBMS.

Enterprise Resource planning system is a fully integrated business management system covering all departments of the business like Finance, Accounting, Human Resources, Production and Logistics. ERP is a Business Solution aims to help the management by setting better business practices and equipping them with the right information to take timely decision. Necessity of ERP Aggressive Cost Control initiatives. Need to analyze costs and revenues on a product or customer basis. Flexibility to respond to changing business requirements. More informed management decision making. Changes in ways of doing business.

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Characteristics of ERP ERP facilitates company wide integrated Information System covering all functional areas like Manufacturing, Sales and Distribution, Payables, Receivables, Inventory, Accounts Human Resources etc. ERP performs core activities and increases customer service thereby augmenting the corporate image. ERP bridges the information gap across organization. ERP provides complete integration of the system not only across the departments but also across the companies under the same management. ERP is the solution for better project management. ERP allows automatic introduction of latest technology like Electronic Fund Transfer (EFT), Electronic Data Interchange (EDI), Internet, Intranet, Video Conferencing, E-Commerce etc. ERP not only addresses the current requirements of the company but also provides the opportunity of continually improving and refining business processes. ERP provides business intelligence tools like Decision Support Systems, Executive Information System, Reporting, Data Mining and Easy Warning Systems for enabling people to make better decision and thus improve their business processes.

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Benefits of ERP Some Tangible Benefits Reduction of Paper Work. Provides greater and effective control on ACCOUNTS. Availability of timely information. Greater accuracy of information with detailed content, better presentation. Improved cost control Faster response and follow ups to customers Better monitoring and quicker resolution of queries Enables quick response to change in business operations and market consumption Improves supply demand linkage with remote locations and branches in different countries Provides a unified customer database usable by all applications Provides solutions to problems like Y2k and Euro currency. Some Intangible Benefits Improved customer satisfaction Improved vendor performance Increased flexibility Reduced Quality Cost Improved information accuracy

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Business process re-engineering is the analysis and design of workflows and processes within an organization. Re-engineering is the basis for many recent developments in management. The crossfunctional team, for example, has become popular because of the desire to re-engineer separate functional tasks into complete cross-functional processes. BPR Focus on end-to-end business process that extends all to the way to a customer (external or internal) who receives some value from the process on essential processes that deliver outcomes - moving flow - Cross-functional in scope within enterprise - Cross-enterprises Assumptions about performance improvement thru. Reengineering Business process is a group of logically related tasks using the firm's resources to provide customer-oriented results to support organisation's objectives. Kinds of process: Operational directly achieves operational objectives Control goal to maintain a state relating to another process Generic applicable to any group member (an abstraction or class, essentials of a process that may be shared)

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Customized adaptation of a generic process to suit specific objectives and using identified resources Enactable defined + executed using process technologies Meta-process concerned with another process(es)

BRP Imperatives evaluate core business activities consider BPs cross-functionally re-design radically, don't just tinker aim for sharp improvements in performance levels BRP process

Organis ing f or improvement

Undestanding the Process

Streamlining

Measurements and Costs

Continuous improvement

The BPR team may benchmark another company's process to determine process objectives innovative practices tried and tested methods

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Benchmarking partners need not be from the same industry. A photocopying firm on re-engineering its order processing system compared itself to mail-order firms as well rival photocopy companies.

BPR Problems Starting with a clean sheet Preoccupation & commitment to existing business processes Thinking the problem thru. in the light of new methods & technologies Choice of the target process The power and resourcing of the cross functional team BPR in isolation from strategic and ops plans will not work. Top commitment essential. Short-termism of decision makers Isolated efforts will lack direction and will get lost. Done at times of stress and anxiety Keeping the BPR team on target BPR team as action researchers Costs of the change We need to keep the old, existing core systems running

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CRM is basically strategic customer relationship management through an enterprise-wide, integrative software package. It is a seamless software implementation which creates Front and Back office integration. It provides interface integration on many levels, such as product and service data, order management, and customer service. Functions of CRM Identify factors important to client Promote a customer oriented philosophy Adopt customer based measures Develop end to end processes to serve customers Handle customer complaints Track all aspects of sales Create a holistic view of customers sales and services information.

Component of A CRM System Operational : automation of basic business processes (marketing, sales, service) Analytical : analysis of customer data and behavior using business intelligence Collaborative: communicating with clients

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Five Views of CRM Marketing Automation Sales Automation Service and Service Fulfillment Customer Self-Service E-Commerce

A Successful CRM Properly trained Front Office staff Proper data and good use of it Proper workflow processes Proper integration of Front Office and Back Office Proper software to support the strategy Full support of top management

What is Data Mining Process of Discovering Meaningful New Correlations, Patterns and Trends through Large Amounts of Data Using Pattern Recognition Technologies as well as Statistical and Mathematical Techniques The term data mining describes a variety of data processing tools and strategies that increase the utility of data in corporate databases. While there is currently no universally accepted definition, the term is broadly used whenever a process or person attempts to discover knowledge buried in the database and displaying the results in a meaningful way. In more advanced systems, data mining is an analytical process which automatically discovers and stated rules that govern relationships between data items in the database.

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A process that uses statistical, mathematical, artificial intelligence and machine-learning techniques to extract and identify useful information and subsequent knowledge from large databases Eg: Direct Marketing Customer Acquisition Customer Retention Cross Selling Fraud Detection Trend Analysis

Why Data mining? Who is my most profitable customer Why will my customer jump to my competitor Which product will my customer buy, in addition to my existing products?

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Data mining cycle

Techniques Neural Network Decision Tree Rule Induction K nearest neighbor Genetic Algorithms Logistic Regression Associations

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Reasons for increased popularity of Data Mining General recognition of the untapped value in large databases Consolidation of database records tending toward a single customer view; Consolidation of databases, including the concept of an information warehouse; Reduction in the cost of data storage and processing, providing for the ability to collect and accumulate data; Intense competition for a customers attention in an increasingly saturated marketplace; and The movement toward the de-massification of business practices Text mining Application of data mining to nonstructured or less structured text files. It entails the generation of meaningful numerical indices from the unstructured text and then processing these indices using various data mining algorithms Text mining helps organizations: Find the hidden content of documents, including additional useful relationships Relate documents across previous unnoticed divisions Group documents by common themes Web mining The discovery and analysis of interesting and useful information from the Web, about the Web, and usually through Web-based tools

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Data Warehouse A data warehouse is a subject-oriented, integrated, nonvolatile, timevariant collection of data in support of management's decisions. Need for Data Warehousing Better business intelligence for end-users Reduction in time to locate, access, and analyze information Consolidation of disparate information sources Strategic advantage over competitors Faster time-to-market for products and services Replacement of older, less-responsive decision support systems Reduction in demand on IS to generate reports

Data Marts Enterprise wide data warehousing projects have a very large cycle time Getting consensus between multiple parties may also be difficult Departments may not be satisfied with priority accorded to them Sometimes individual departmental needs may be strong enough to warrant a local implementation Application/database distribution is also an important factor

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Primary HR Activities Recruiting & Hiring Education & Training Data Management Termination & Benefit Administration

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What is knowledge management KM is the process through which organizations generate value from their intellectual and knowledge-based assets Most often, generating value from such assets involves codifying what employees, partners and customers know, and sharing that information among employees, departments and even with other companies in an effort to devise best practices

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Knowledge management (KM) is an effort to increase useful knowledge within the organization. Ways to do this include encouraging communication, offering opportunities to learn, and promoting the sharing of appropriate knowledge artifacts Information relates to description, definition, or perspective (what, who, when, where). Knowledge comprises strategy, practice, method, or approach (how). Wisdom embodies principle, insight, moral, or archetype (why). Explicit knowledge can be recorded digitally in documents, records, patents and other intellectual property artifacts. Explicit knowledge is representational and can live and be manipulated within the digital domain Tacit knowledge is made up of best practices, experience, wisdom and unrecordable intellectual property that lives within individuals and teams. Since tacit knowledge exists within minds, it cannot be reduced to the digital domain as a material asset, or be manipulated directly.

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There are two fundamental approaches to knowledge management: : process approach practice approach Process Approach is favored by firms that sell relatively standardized products since the knowledge in these firms is fairly explicit because of the nature of the products & services. Practice approach is typically adopted by companies that provide highly customized solutions to unique problems. The valuable knowledge for these firms is tacit in nature, which is difficult to express, capture, and manage. KM success factors There should be a link to a firms economic value-business processes should be connected to KM For example Development of new products process Customer service process Technological infrastructure and knowledge infrastructure Organizational culture should be ready for KM Introducing a system to employees

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Process mapping A graphical presentation that document the tasks and other aspects of processes Likely results of process mapping Increased understanding of process, Increase consensus about the process, Increased visibility into the process. Top down flow chart Swimlane Value stream mapping Systems Development Life Cycle Preliminary investigation o Feasibility study / System survey o Determine the problem o Describe the problem o Understand management decisions Organizational chart

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o o o o o

Informal hierarchy Produces rough plan and what to do Problem Definition Nature of the problem Separate problem from symptoms of problem Scope of the project Budget and schedule Objectives of the project What user thinks system should do

Analysis o Understand the existing system Gather data Analyze data o Establish system requirements Design o Planning the new system o Two phases Preliminary design Detail design Development o Testing o Programming Implementation

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Artificial intelligence (AI): Computers with the ability to mimic or duplicate the functions of the human brain Artificial intelligence systems: The people, procedures, hardware, software, data, and knowledge needed to develop computer systems and machines that demonstrate the characteristics of intelligence The branch of computer science concerned with making computers behave like humans. The term was coined in 1956 by John McCarthy at the Massachusetts Institute of Technology. Artificial intelligence includes games playing: programming computers to play games such as chess and checkers expert systems: programming computers to make decisions in reallife situations (for example, some expert systems help doctors diagnose diseases based on symptoms) natural language: programming computers to understand natural human languages Limitations of Expert Systems Not widely used or tested Limited to relatively narrow problems Cannot readily deal with mixed knowledge Possibility of error Cannot refine own knowledge base Difficult to maintain May have high development costs Raise legal and ethical concerns

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Executive Support System A specialized DSS that includes all the hardware, software, data, procedures, and people used to assist senior-level executives within the organization Characteristics of ESSs Tailored to individual executives Easy to use Drill down capabilities Support the need for external data Help with situations with high degree of uncertainty Futures orientation (predictions, forecasting) Linked with value-added business processes

Capabilities of an ESS Support for defining overall vision strategic planning strategic organizing and staffing strategic control crisis management

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The three major types of electronic commerce are: Business-to-consumer (B2C): Retailing products and services to individual shoppers Business-to-business (B2B): Sales of goods and services among businesses Consumer-to-consumer (C2C): Consumers selling directly to other consumers.

Supply Chain Management Systems Supply chain management refers to the coordination of activities and involved in making and moving a product. The supply chain is the network of businesses and business processes involved the creation and selling of a product, from suppliers that procure raw materials through retail outlets and customers. The more comprehensive CRM packages contain modules for: Partner relationship management (PRM): PRM software uses many of the same data, tools, and systems as customer relationship management to enhance collaboration between a company and its selling partners. It provides a company and its selling partners with the ability to trade information and distribute leads and data about customers, integrating lead generation, pricing, promotions, order configurations, and availability. Employee relationship management (ERM). ERM software deals with employee issues that are closely related to CRM, such as setting objectives, employee performance management, performance-based compensation, and employee training.

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