Chapter 8

Enterprise Business Systems

McGraw-Hill/Irwin

Copyright 2011 by The McGraw-Hill Companies, Inc. All rights reserved.

Learning Objectives
Identify and give examples to illustrate the following aspects of customer relationship management, enterprise resource management, and supply chain management systems:
Business processes supported Customer and business value provided Potential challenges and trends

Understand the importance of managing at the enterprise level to achieve maximum efficiencies and benefits.
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Customer Relationship Management (CRM)

Customer focused
Customer relationships most valued asset Find and retain most profitable customers possible

Company has
Single, complete view of every customer

Customers have
Single, complete view of the company

Integrates and automates customerserving processes

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Contact and Account Management

Track relevant data about
Every past and planned contact with prospects and customers Other business and life cycle events

Data captured from touchpoints

Telephone, fax, e-mail Websites, retail stores, kiosks Personal contact

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Marketing and Fulfillment

Automate direct marketing campaigns
Qualifying leads for targeted marketing

Scheduling and tracking mailings

Capturing and managing responses Analyzing the business value of the campaign Fulfilling responses and requests

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Customer Service and Support

Shared database
Requests for service are created, assigned, and managed Call center software routes calls to agents Help desk software provides service data and suggestions for solving problems

Personalized support information

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Retention and Loyalty Programs

Primary objective - enhancing and optimizing customer retention and loyalty
Identify, reward, and market to the most loyal and profitable customers Evaluate targeted marketing and relationship programs

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Benefits of CRM
Identify and target the best customers Real-time customization and personalization of products and services Track when and how a customer contacts the company Provide a consistent customer experience Provide superior service and support

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CRM Failures
Reasons for Failure
Lack of senior management sponsorship Improper change management Elongated projects that take on too much, too fast Lack of or poor integration between CRM and core business systems Lack of end-user incentives leading to poor user adoption rates Lack of understanding and preparation -- # 1 Not solving business process problems first No participation on part of business stakeholders involved
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What is ERP?
Cross-functional enterprise system
Integrated suite of software modules Supports basic internal business processes
Manufacturing Logistics Distribution Accounting Finance Human resources

Facilitates information flows

Business Supplier Customer
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Causes of ERP Failures

Most common causes of ERP failure
Under-estimating complexity
Planning, development, training

Failure to involve affected employees Too much too fast Insufficient training Insufficient data conversion and testing Over-reliance on ERP vendor or consultants

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Supply Chain Management (SCM)

Helps a company
Get the right products To the right place At the right time In the proper quantity At an acceptable cost Forecast demand Control inventory Enhance relationships Receive feedback
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Goal of SCM is to efficiently

Benefits of SCM
Key Benefits
Faster, more accurate order processing Reductions in inventory levels Quicker times to market Lower transaction and materials costs Strategic relationships with supplier

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Challenges of SCM
Key Challenges
Lack of knowledge, tools, and guidelines
Inaccurate data Lack of collaboration

SCM tools are immature, incomplete, and hard to implement

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Trends in SCM
CVS, McKesson
CVS leading drug retail chain McKesson largest pharmaceutical distributor Point-of-sale data Agreed on service levels Reduced replenishment time

Modern Plastics, SupplySolution, Inc.

Upraded reactive system to proactive system

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