Global E-business and Collaboration

Develop knowledge-sharing strategy and goals Management Blusiness Challenges Hierarchical top-down processes and culture New competitors Redesign knowledge-sharing and collaboration processes Change organizational culture Yammer Organization Technology Information Systern Enterprise Social Networking Provide new channels for knowledge-sharing, innovation, and collaboration Business Solutions Improve productivity Reduce costs Increase innovation Yammer's social tools to increase employee collaboration and engagement and to open up dialogues with management. There is now more effective sharing of employee knowledge, and the company has become more innovative and effective. New technology alone would not have solved Sharp Corporation's problem. To make the solution effective, Sharp had to change its organizational culture and business processes for knowledge dissemination and collaborative work, and the new technology made these changes possible. Here are some questions to think about: How are collaboration and em-ployee engagement helping Sharp Corporation to be more competitive? How did using Yammer change corporate culture and the way work was performed at Sharp Corporation? 2-1 What are business processes? How are they related to information systems? In order to operate, businesses must deal with many different pieces of in-formation about suppliers, customers, employees, invoices, payments, and of course their products and services. They must organize work activities that use this information to operate efficiently and enhance the overall performance of the firm. Information systems make it possible for firms to manage all their in-formation, make better decisions, and improve the execution of their business processes. Business Processes Business processes, which we introduced in Chapter 1, refer to the manner in which work is organized, coordinated, and focused to produce a valuable product or service. Business processes are the collection of activities required to produce a product or service. These activities are supported by flows of ma terial, information, and knowledge among the participants in business pro-cesses. Business processes also refer to the unique ways in which organizations coordinate work, information, and knowledge, and the ways in which manage-ment chooses to coordinate work. To a large extent, the performance of a business firm depends on how well its business processes are designed and coordinated. A company's busi-ness processes can be a source of competitive strength if they enable the company to innovate or to execute better than its rivals. Business processes can also be liabilities if they are based on inefficient ways of working that impede organizational responsiveness and efficiency. The chapter-opening case describing Sharp Corporation's improvements in knowledge-sharing. processes clearly illustrates these points, as do many of the other cases in this text. Every business can be seen as a collection of business processes, some of which are part of larger encompassing processes. For instance, uses of mentor-ing, wikis, blogs, and videos are all part of the overall knowledge management process. Many business processes are tied to a specific functional area. For example, the sales and marketing function is responsible for identifying cus tomers, and the human resources function is responsible for hiring employees. Table 2.1 describes some typical business processes for each of the functional areas of business. Other business processes cross many different functional areas and require coordination across departments. For instance, consider the seemingly simple business process of fulfilling a customer order (see Figure 2.1). Initially, the sales department receives a sales order. The order passes first to accounting to ensure the customer can pay for the order either by a credit verification or request for immediate payment prior to shipping. Once the customer credit is established, the production department pulls the product from inventory or produces the product. Then the product is shipped (and this may require work-ing with a logistics firm, such as UPS or FedEx). A bill or invoice is generated by the accounting department, and a notice is sent to the customer indicating that the product has shipped. The sales department is notified of the shipment and prepares to support the customer by answering calls or fulfilling warranty claims. What at first appears to be a simple process, fulfilling an order, turns out to be a very complicated series of business processes that require the close TABLE 2.1 EXAMPLES OF FUNCTIONAL BUSINESS PROCESSES FUNCTIONAL AREA BUSINESS PROCESS Manufacturing and production Assembling the product. Checking for quality Sales and marketing Finance and accounting Producing bills of materials Identifying customers Making customers aware of the product Selling the product Paying creditors Creating financial statements Managing cash accounts Hiring employees Human resources Evaluating employees' job performance Enrolling employees in benefits plans FIGURE 2.1 THE ORDER FULFILLMENT PROCESS Fulfilling a customer order involves a complex set of steps that requires the close coordination of the sales, accounting, and manufacturing functions. Sales Generate order Submit order Accounting Check credit Approve credit Generata invoice Manufacturing and Production Assemble product Ship product coordination of major functional groups in a firm. Moreover, to efficiently perform all these steps in the order fulfillment process requires a great deal of information. The required information must flow rapidly within the firm from one decision maker to another; with business partners, such as delivery firms; and with the customer. Computer-based information systems make this possible. How Information Technology Improves Business Processes Exactly how do information systems improve business processes? Information. systems automate many steps in business processes that were formerly per formed manually, such as checking a client's credit or generating an invoice and shipping order. But today, information technology can do much more. New technology can actually change the flow of information, making it possible for many more people to access and share information, replacing sequential steps with tasks that can be performed simultaneously, and eliminating delays in de cision making. New information technology frequently changes the way a busi-ness works and supports entirely new business models. Downloading a Kindle e-book from Amazon, buying a computer online at Scan UK, and streaming a music track from Apple Music are entirely new business processes based on new business models that would be inconceivable without today's information technology. That's why it's so important to pay close attention to business processes, both in your information systems course and in your future career. By analyzing business processes, you can achieve a very clear understanding of how a busi-ness actually works. Moreover, by conducting a business process analysis, you will also begin to understand how to change the business by improving its pro-cesses to make it more efficient or effective. Throughout this book, we examine business processes with a view to understanding how they might be improved by using information technology to achieve greater efficiency, innovation, and customer service. 2-2 How do systems serve the different management groups in a business, and how do systems that link the enterprise improve organizational performance? Now that you understand business processes, it is time to look more closely at how information systems support the business processes of a firm. Because there are different interests, specialties, and levels in an organization, there are different kinds of systems. No single system can provide all the information an organization needs. A typical business organization has systems supporting processes for each of the major business functions-sales and marketing, manufacturing and pro-duction, finance and accounting, and human resources. You can find exam-ples of systems for each of these business functions in the Learning Tracks for this chapter. Functional systems that operate independently of each other are becoming a thing of the past because they cannot easily share informa-tion to support cross-functional business processes. Many have been replaced with large-scale cross-functional systems that integrate the activities of related business processes and organizational units. We describe these integrated cross-functional applications later in this section. A typical firm also has different systems supporting the decision-making needs of each of the main management groups we described in Chapter 1. Operational management, middle management, and senior management each use systems to support the decisions they must make to run the company. Let's look at these systems and the types of decisions they support. Systems for Different Management Groups A business firm has systems to support different groups or levels of manage-ment. These systems include transaction processing systems and systems for business intelligence. Transaction Processing Systems Operational managers need systems that keep track of the elementary activi-ties and transactions of the organization, such as sales, receipts, cash deposits, payroll, credit decisions, and the flow of materials in a factory. Transaction processing systems (TPS) provide this kind of information. A transaction pro-cessing system is a computerized system that performs and records the daily routine transactions necessary to conduct business, such as sales order entry, hotel reservations, payroll, employee record keeping, and shipping. The principal purpose of systems at this level is to answer routine questions. and to track the flow of transactions through the organization. How many parts are in inventory? What happened to Mr. Smith's payment? To answer these kinds of questions, information generally must be easily available, current, and accurate. At the operational level, tasks, resources, and goals are predefined and highly structured. The decision to grant credit to a customer, for instance, is made by a lower-level supervisor according to predefined criteria. All that must be deter-mined is whether the customer meets the criteria. Figure 2.2 illustrates a TPS for payroll processing. A payroll system keeps track of money paid to employees. An employee time sheet with the employ-ee's name, social security number, and number of hours worked per week