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Chapter7 ANSWERS TO DISCUSSION QUESTIONS

1. How is e-business redefining old business models, with the aid of technology, to maximize customer value? e-business is more than just buying and selling of products and services through the means of digital media. Whereas e-commerce concentrates on buying and selling, e-business encompasses e-commerce and a whole lot more. For example, e-business includes both front and back-office applications that form the engine for modern business. e-business is redefining old business models through the aid of technology, to maximize customer value. e-business is the use of the Internet and other networks and information technologies to support electronic commerce, enterprise communications and collaboration, and Web-enabled business processes both within an internetworked enterprise, and with its customers and business partners. 2. Why is there a trend toward cross-functional integrated enterprise systems in business? Cross-functional information systems are integrated combinations of business information systems that share information resources across the functional units of an organization. Integrated systems allow the same data to be used for multiple applications; information output from one function can easily become data input to another function. Only one integrated database needs to be maintained. Many organizations are using information technology to develop integrated cross-functional enterprise systems that cross the boundaries of traditional business functions in order to reengineer and improve vital business processes all across the enterprise. These organizations view cross-functional enterprise systems as a strategic way to use IT to share information resources and improve the efficiency and effectiveness of business processes, thus helping an e-business attain its strategic objectives. 3. Do you agree that ERP is the backbone of e-Business? Why or why not? it can be argued that enterprise resource planning (ERP) could certainly be considered the backbone of e-business. Businesses today must be deeply involved in coordinating and conducting business in the new economy. Through technologies such as the Internet and other networks and information technologies businesses are able to support electronic commerce, enterprise communications and collaboration, and Web-enabled business processes both within an internetworked enterprise, and with its customers and business partners. 4. Refer to the Real World Case on Charles Schwab and Others in this chapter. What are the most important HR applications a company should offer to its employees via a Web-based system? Why? There are a number of important HR applications that a company can and should offer their employees via a Web-based system. No matter what applications a company provides it must ensure that they are accurate, up to date, and provide the employees with the information they want. The purpose of the system is to free up the time for HR management to be more efficient in planning HR strategies than being burdened with boring paper work. For the employees, they 1

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want to be able to have access to the information that pertains to them, and the information that they need to satisfy their inquiry. Employees are interested in issues such as pay and benefits, pension funds, stock options, vacation time, career opportunities, training and development initiatives, and other related personnel issues. 5. How do you think sales force automation affects salesperson productivity, marketing management, and competitive advantage? Sales force automation is the use of computers to automate sales recording and reporting by sales people as well as communications and sales support. It improves productivity by saving time otherwise spent on manual creation of records, reports, and presentations; it improves communications and accessibility to information to support sales activities; and it may help in planning sales tactics. Increasingly, computers and networks are providing the basis for sales force automation. In many companies, the sales force is being outfitted with notebook computers that connect them to Web browsers, and sales contact management software that connect them to marketing websites on the Internet, extranets, and their company intranets. Sales force automation has resulted in increasing the personal productivity of salespeople, dramatically speed up the capture and analysis of sales data from the field to marketing managers at company headquarters, allows marketing and sales management to improve the delivery of information and the support they provide to their salespeople. Many companies view sales force automation as a way to gain a strategic advantage in sales productivity and marketing responsiveness. 6. How can Internet technologies be involved in improving a process in one of the functions of business? Choose one example and evaluate its business value. it will be relatively easy for them to choose from any of the various functions of business such as accounting, marketing, manufacturing, retailing, operations, and so on. In response to this question, the accounting function was chosen. Accounting information systems are being affected by Internet and client/server technologies. Using the Internet, intranets, extranets, and other network changes have been made to the traditional methods of capturing and processing accounting data. As well, these technologies have assisted in how accounting information systems are being used to monitor and track business activity. The online, interactive nature of such networks calls for new forms of transaction documents, procedures, and controls. Many companies are using or developing network links to their trading partners through the use of the Internet or other networks for applications such as order processing inventory control, accounts receivable, and accounts payable. These advances in the accounting function have resulted in major improvements in the capturing, reporting, processing, and increased accuracy of the data. Thus, realtime processing of accounting information enables executives to make better and more informed decisions involving their firms resources. 7. How can the Internet technologies improve customer relationships, and service for a business?

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CRM is described as a cross-functional e-business application that integrates and automates many customer-serving processes in sales, direct marketing, accounting and order management, and customer service and support. Examples of business benefits of customer relationship management include: CRM allows a business to identify and target their best customers; those who are the most profitable to the business, so they can be retained as lifelong customers for greater and more profitable services. CRM enables real-time customization and personalization of products and services based on customer wants, needs, buying habits, and life cycles. CRM can keep track of when a customer contacts the company, regardless of the contact point.

CRM enables a company to provide a consistent customer experience and superior service and support across all the contact points a customer chooses.

The key to survival today is through improved customer relationships. The Internet has enabled interactive marketing between a business and its customers. The Internet can improve customer value, as the customer becomes closer to the business. Through interactive marketing methods, the needs of the customer are being better served. with the services requested. Relationships between customers and business are also greatly enhanced, and businesses are better able to provide their customers

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Refer to the Real World Case Harrahs, DuPont, and Otis at the end of the chapter. What are several e-business applications that you might recommend to a small company to help it survive and succeed in challenging economic times? Why? Small businesses as well as large businesses must make serious attempts to ensure that they have a Web presence. Customers are turning to the Web as a means of conducting business, and the growth in B2B has been exceptional. Final consumers are also ordering more products and services through the use of technology such as the Web. Small businesses can also have a successful website where they can offer their products and services to customers. Ensuring that the site is easy to navigate and order from is a major key to its success. If you are not going to actually sell products and services online, you can still use e-business applications to order from your suppliers online. By doing so, small businesses order products for just-in-time delivery, reduce inventory charges, and enable them to shop / click around for better deals. 9. Which of the 14 tools for enterprise collaboration summarized in Figure 7.13 do you

feel are essential for any business to have today? Which of them do you feel are optional, depending on the type of business or other factor? Explain. This question will vary, and much depends on what type of organization they are applying these enterprise collaboration tools to. For this exercise we will assume that the student is applying the tools to an engineering environment requirement where the job is being designed in the United States, but being constructed in Argentina. Students can easily include and justify the 3

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requirement for all of the tools outlined in the electronic communication, electronic conferencing, and collaborative work management tools. However, if a student were to present the case of a university who does not offer extension courses, they may feel that there is no requirement for the school to use electronic conferencing tools. 10. What is the role and business value of using Internet technologies in supply chain management? The goal of supply chain management is to give customers what they want, where they want it, and at the lowest possible cost. The goal of SCM is to: Reduce costs Increase efficiency Increase profits Improve supply chain cycle times Improve performance in relationships with customers and suppliers Develop value-added services that give a company a competitive edge

According to the Advanced Management Council, supply chain management has three business objectives: Get the right product to the right place at the least cost. Keep inventory as low as possible and still offers superior customer service. Reduce cycle times. Supply chain management seeks to simplify and accelerate operations that deal with how customer orders are processed through the system and ultimately filled, as well as how raw materials are acquired and delivered for manufacturing processes. Businesses are increasingly dependent upon Internet technologies to improve their efficiencies. For example, companies are spending time and resources in improving their systems with those of their customers, partners, and suppliers. Through these improved systems, companies are better able to integrate interenterprise supply processes in order to improve manufacturing and distribution effectiveness. Companies are given SCM top priority and making it a large part of their e-business initiatives. By serving their customers better than their competitors, they are able to maintain and perhaps gain market share.