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D AY 01: 05/01/2009

Decision support and management information system

Unit -01 Concept of information, concept of system, importance of information and information system for organizations specially business enterprises; operating elements of a computer based information system; introduction to office automation system (OAS), transaction processing system ( TPS), Management Information System ( MIS), Decision Support System ( DSS), executive Information system ( EIS), KBS, expert system etc. UNIT II Decision making process-stages in decision making, individual and organizational; decision making models; information system support for decision making phases; definition, characteristics, subsystem of MIS, MIS and top management, structure of MIS (conceptual and physical structure) UNIT III MIS planning and control; MIS master plan-content and description: Nolan stage model, three stage model of planning process- the strategic planning stage, organizational information requirement analysis and resource allocation stage; myths of MIS, pitfalls of MIS, limitations of MIS UNIT-IV Decision Support System-definition, relationship with MIS, evolution of DSS; characteristics, classification, objectives, components, functions and development of DSS; artificial intelligence for MIS problems-use of expert systems, use of neural networks. UNIT-V Emerging concepts and issue in information systems- supply chain management, customer relationship management, ERP; introduction to data warehousing, data mining and its application, emerging concepts in information system design and applications; e-commerce, B-to-B, B2C transactions; security issue, EDI-format, international protocol etc.

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Decision support and management infromation system Unit -01 Concept of information,
Organizations could be perceived as an entity, which is a group of people, machines or a system. A system requires information to channels decisions and other activities in the organization. Information management could be done in following manners Discrete way To look organization as a whole To identify procedures To coordinate between a number of subunits Information is a cementing agent in an organization. Information is also like nervous system of the organization. System could be divided into 03 types: Internal and External. Information is used to strengthen the organization. Date: 12/01/09 Information Technology - 70s ICT after 70s ITES- after 2000 11 An MIS include all the ingredients that are employed in providing information support to managers in making planning and control decisions. Managers often use historical data on an organizations activities as-well-as current status data to make planning and control decisions. Such data comes from a data base which is contained in files (paper or electronics) maintained by the organization. This database is an essential component of MIS. 15 INFROMATION CLASSIFICATION n Action Vs Non-Action n Current Vs Historical n Strategic Vs Routine 16 COST OF INFORMATION n Hardware n Software n Operational n Systems Analysis 17 ( 27/01/2009) INFORMATION UTILITY n Form n Place

n Time n Access/ Rights 18 The Management Information System (MIS) is a new concept of the last one or two decades. It has been understood and described in a number of ways. It is popularly known as the Information System, the Information and Decision System, the Computer-based Information System. 19 Management is an art as well as science. Management is also defined as getting the work done. Management is used to control manpower, machine, and operations according to the requirements. One of fundamental role of management is control of any organization. What is control? How do a manager control the organisation? What is the nature and purpose of control? This module seeks to answer to these queries, particularly to control and information system. 20 n The MIS is defined as a system dependent on database system of the organization evolved for the purpose of providing information to the people in the organization. n The modern MIS is defined as a Computer-based Information System.

21 RESPONSIBILITIES OF A MANAGER n Information has always been the integral part of Managers job in any organisation. Management itself is a series of obtaining, processing, sorting, analysing, synthesizing, retrieving information. So, responsibilities of a manager working in tourism and travel industry must be:n Manager who receive data and information must decide what to do with it. Some part is stored for possible later use and other information is combined to form new information. On the other hand some is used immediately and some is passed on to others. n Manager must decide the value of information for organisation. 22 n Manager must find out data life cycle to delete unwanted information and keep safely the valuable information. n manager must classify information in such a way so that it could be available to him at the time of decision making. n It is the responsibility of manager to make it available to the top management as and when required. n It is the responsibility of manager to make it available to share holders, public, employees at the time of requirement. 23 Development of MIS n System Analysis n System Design n Quality Control (complete data, accurate data, precise data, understandable data, timely data, relevant adapt, meaningful output, user frnd. Ope., error res. Operation, authorized use, protected sys& operation) Method: parity bit to detect error, check digits, run-to-run control totals, verification of i/p data by rekeying and comparing

n Feedback The Application system development life cycle ( Davis, pp-571) 1. Definition stage a. Proposal definition ( Preparation of request for a proposed system) b. Feasibility assessment (Evaluation of feasibility, cost benefit of proposed application 1. Technical 2. Economic 3. Motivation 4. Schedule; 5. Operation) c. Information requirements analysis ( determination of info. Needed) d. conceptual design ( user oriented design of application) 2. Development Stage a. physical system design ( Detailed design of flow and procedure in application processing system and preparation of programme specification) b. program development ( coding and testing of computer programme) c. procedure development ( design of procedure) 3. Installation and operation a. Conversion ( Final system test) b. operation and maintenance ( day-to-day operation) c. post audit ( evaluation and result use) Information Requirement Analysis (Davis, pp576): Reports Queries Conceptual schema for database ( data modeling) Functional ( operational characteristics) User interface requirements System Development Life Cycle 24 Market Information System n It is a data mgt. and distribution system. Finland Tourism Board use MIS for: n Tour operators and travel agency profiles. n Basic data on key markets. (Source: E-Business for Tourism, WTO, pp31)

Concept of system,
System (from Latin systma, in turn from Greek systma) is a set of interacting or interdependent entities, real or abstract, forming an integrated whole. The concept of an "integrated whole" can also be stated in terms of a system embodying a set of relationships which are differentiated from relationships of the set to other elements, and from relationships between an element of the set and elements not a part of the relational regime. The scientific research field which is engaged in the study of the general properties of systems include system theory, system science and systematic. They investigate the abstract properties of the matter and organization, searching concepts and principles which are independent of the specific domain, substance, type, or temporal scales of existence. Most systems share the same common characteristics. These common characteristics include the following

Systems are abstraction of reality. Systems have structure which is defined by its parts and their composition. Systems have bahaviour , which involves inputs, processing and outputs of material,

information or energy. The various parts of a system have functional as well as structural relationships between each other.

History:
The term System has a long history which can be traced back to the Greek language. In the 19th century the first to develop the concept of a "system" in the natural sciences was the French physicist Nicolas Lonard Sadi Carnot who studied thermodynamics. In 1824 he studied what he called the working substance (system), i.e. typically a body of water vapor, in steam engines, in regards to the system's ability to do work when heat is applied to it. The working substance could be put in contact with either a boiler, a cold reservoir (a stream of cold water), or a piston (to which the working body could do work by pushing on it). In 1850, the German physicist Rudolf Clausius generalized this picture to include the concept of the surroundings and began to use the term "working body" when referring to the system. One of the pioneers of the general system theory was the biologist Ludwig von von Bertlanffy. In 1945 he introduced models, principles, and laws that apply to generalized systems or their subclasses, irrespective of their particular kind, the nature of their component elements, and the relation or 'forces' between them.[1] Significant development to the concept of a system was done by Norberty Wiener and Ross Ashby who pioneered the use of mathematics to study systems [2][3] . In the 1980s the term complex adaptive system was coined at the interdisciplinary Santa Fe Institute by John H. Holland Murray Gell-Mann, and others. (www.wikipedia.com,

30/01/2009)

Importance of information and information system for organizations specially business enterprises;

In a general sense, the term information system (IS) refers to a system of persons, data records and activities that process the data and information in an organization, and it includes the organization's manual and automated processes. In a narrow sense, the term information system (or computer-based information system) refers to the specific application software that is used to store data records in a computer system and automates some of the informationprocessing activities of the organization. Computer-based information systems are in the field of information technology. The discipline of Business process modeling describes the business processes supported by information systems.

( www.wikipedia.com, 30/01/2009) Operating elements of a computer based information system; Introduction to office automation system (OAS),
Office automation refers to the varied computer machinery and software used to digitally create, collect, store, manipulate, and relay office information needed for accomplishing basic tasks and goals. Raw data storage, electronic transfer, and the management of electronic business information comprise the basic activities of an office automation system. [1] Office automation

helps in optimizing or automating existing office procedures. The backbone of office automation is a LAN, which allows users to transmit data, mail and even voice across the network. All office functions, including dictation, typing, filing, copying, fax, Telex, microfilm and records management, telephone and telephone switchboard operations, fall into this category. Office automation was a popular term in the 1970s and 1980s as the desktop computer exploded onto the scene.[2] Office Automation Software is a class of software sold initially in the 1980s. The goal of the software was to create a "Paperless Office" and allow groups of workers to share documents and files electronically. Typical packages included a word processing package, file storage, and calendar. Packages were available from a number of companies including:

IBM_PROFS Data General-CEO ( Data General) Digital Equipment Corporation all-in-one Wang laboratories- Office Information System

All of these software packages only ran on hardware from the same manufacturer. Furthermore, they usually only supported proprietary file structures and networking. These factors contributed to their decline as software that could run on PC's using standard networking protocols was more attractive to users. By the 2000s most people had replaced their proprietary office automation systems with PC based products.

(Source: Review in Software Magazine March 1988 and www.wikipedia.com, 30/01/2009) Transaction processing system (TPS),
A Transaction Processing System or Transaction Processing Monitor is a system that monitors transaction programs (a special kind of programs). The essence of a transaction program is that it manages data that must be left in a consistent state. E.g. if an electronic payment is made, the amount must be either both withdrawn from one account and added to the other, or none at all. In case of a failure preventing transaction completion, the partially executed transaction must be rolled back ' by the TPS. While this type of integrity must be provided also for batch transaction processing , it is particularly important for online processing: if e.g. an airline seat reservation system is accessed by multiple operators, after an empty seat inquiry, the seat reservation data must be locked until the reservation is made, otherwise another user may get the impression a seat is still free while it is actually being booked at the time. Without proper transaction monitoring, double bookings may occur. Other transaction monitor functions include deadlock detection and resolution (deadlocks may be inevitable in certain cases of crossdependence on data), and transaction logging (in 'journals') for 'forward recovery' in case of massive failures. Transaction Processing is not limited to application programs. The 'journaled file system' provided with IBMs AIX Unix operating system employs similar techniques to maintain file system integrity, including a journal. (Source: www. Wikipedia.com, 30/01/2009)

Management Information System (MIS), Decision Support System (DSS),

A decision Support System is an information system application that assists in decision making. DSS tends to be used in planning, analyzing alternatives, and trial and error search for solutions. They are generally operated through terminal based interactive dialogue with users. (Gordon B. Davis and Olson M.H., 2003, pp-11). In DSS, emphasis is on support rather than automation of decisions. DSS allows decision maker to retrieve data and test all alternative solutions during the process of problem solving. (Gordon B. Davis and Olson M.H., 2003, pp-368).

Executive Information system (EIS),

An Executive Information System (EIS) is a type of management information system intended to facilitate and support the information and decision making needs of senior executives by providing easy access to both internal and external information relevant to meeting the strategic goals of the organization. It is commonly considered as a specialized form of a Decision Support System (DSS)[cf., [1]].

The emphasis of EIS is on graphical displays and easy-to-use user interfaces. They offer strong reporting and drill-down capabilities. In general, EIS are enterprise-wide DSS that help top-level executives analyze, compare, and highlight trends in important variables so that they can monitor performance and identify opportunities and problems. EIS and data warehousing technologies are converging in the marketplace. In recent years, the term EIS has lost popularity in favour of Business Intelligence (with the sub areas of reporting, analytics, and digital dashboards).

KBS,

Knowledge-based system is a program for extending and/or querying a knowledge base system. A knowledge-based system as a computer system that is programmed to imitate human problemsolving by means of artificial intelligence and reference to a database of knowledge on a particular subject. Knowledge-based systems are systems based on the methods and techniques of Articifal Intelligent. Their core components are the knowledge base and the inference mechanisms. While for some authors expert systems, case based reasoning systems and neural networks are all particular types of knowledge-based systems, there are others who consider that neural networks are different, and exclude it from this category. (www. Wikipedia.com, 30/01/2009)

Expert system etc.

An expert system is a computer application that guides the performance of ill structured task which usually requires experience and specialized knowledge .i.e. expertise. Using an expert system a non-expert can achieve performance comparable to an expert in that area. The unique and distinguishing feature of ES is the knowledge base, the data and decision rules which represent the expertise. Example: Medical diagnosis expert system provides the system with a particular set of symptoms. (Gordon B. Davis and Olson M.H., 2003, pp-374; D. S. Nau, Expert Computer System, Computer, feb.1983) Few ES are: 1. Oil Exploration 2. Medical Consulting

DENDRAL DIPMETER ADVISOR

3. Mineral Exploration PROSPECTOR 4. Computer configuration R1 ( Gordon B. Davis and Olson M.H., 2003,pp-376)

Date: 02/02/2009 Differentiating Data Processing and MIS Data processing is processing of data. But, MIS is more comprehensive.

WHY MKT. IS
Ubiquity Global Reach Universal Standard Richness Interactivity Information Density o Price transparency o Cost Transparency Personalisation/Customisation (Laudon Kenneth C. and Laudon Jane P., 2008, Pearson, New Delhi page-428)

SALES AND MARKETING IS: BACKGROUND


Sales orders must be processed and transmitted to production and inventory. Firms need sales and marketing information in order to do product planning, make pricing decisions, devise advertising, and other promotional campaigns and forecast market potential for new and existing products. Sales function of a typical business captures and processes customer orders and produces invoice for customers and data for inventory and production. A typical invoice is illustrated here:Healthline Yougurt Inc. Custiomer: Highview Supermarket 223, Highland AQvanue, Ossing, New York 10562 Order Number: 679940 Customer Number: #00395 Date: 15Feb.2007 Quantity SKU# Description Unit Price Amount 100 V3392 8oz vanilla .44 44.00 50 S4456 8oz Strawberry .44 22.00 65 L4492 8oz Lemon .44 28.60 Shipping: 10.00 Total invoice: 104.60

The above data can be used by sales manager to plan and monitor the performance of the sales force. Management also needs information on the performance of specific products, product line, or brands. Price revenue, cost and growth information can be used for pricing decisions for evaluating the performance of current products and for predicting the performance of future product. (Laudon Kenneth C. and Laudon Jane P., 2008, Pearson, New Delhi, Page- 664)

BUSINESS PROCESSES AND Mkt. IS Information system is all about improving business process which lies at the heart of any business. So, it is important to understand the meaning of business process. Business process is basically workflow of infdrmation and knowledge, material. It also refers to unique ways in which organsiation coordinates work, information and knowledge, and the ways in which management hcooses work. Evry business can be seen as a collection of business processes. Many businesses are tied to a specifica functional area. For example sales and marketing functions would be responsible for indentifying customers. Table Functional Area Business process Sales and Marketing Indentifying customers Making customers aware about the product selling the product ( Loudon, Pearson, page-76) SALES AND MARKETING IS It is responsible for selling the product. Marketing is concerned with identifying the customer, determining customers need and want, planning and developing product and services to meet their needs, advertising and promoting these products and services.sales is concerned with contacting cutomers, selling product and services, taking orders, and flooiwng up on sales. These activities can be thought of as business processes. Table Examples of Sale s and marketing IS SYSTEM DESCRIPION GROUP SERVED Order process. Enter, pross & track orders Ope.mgt. & emp. Pricing ana. Determine4prod. & Ser. Middle mgt. Sales trend 4casting prepare 5yr sales 4cast Senior mgt. (Laudon Kenneth C. and Laudon Jane P., 2008, Pearson, New Delhi, page-79)

Above table is used by the retailesr such as the gap or target, Point-of-sale devices ( capture data about product) captures data and updates sales system. IMPROVING DECIONMAKING: USING INTERNET NEWSGROUP FOR ONLINE MARKET REESRACH Software skills: Web browser software and internet news group Business skills: Using internet news groups to identify potential customers You are producing hiking shoes that you are selling through few stores. 1. Visit google Usenet archive groups.gogle.com, which stores discussion postings from many thousands of news groups.

2. Next use of Google or yahoo.com to search for he hiking boot industry and locate sites to get idea about potential customers. 3. Prepare a plan to use news group and other alternatives methods to begin attracting visitors to your site. (Laudon Kenneth C. and Laudon Jane P., 2008, Pearson, New Delhi page-192-193)

SALES FORCE AUTOMATION

Sales force automation in CRM helps sales staff to increase their productivity by focusing on sales orders, identifying most profitable customers. CRM provides sales prospects, contact information, product information, product configuration capabilities, sales quote generation capabilities. Such software can assemble information about customers and help a sale person to make personalized recommendation. Customer service: Customer service in CRM provide s infrmaoin and toole to increase efficiency of call centres, help desk, and customer support staff. They have capabilities for assigning and managing customer service requests. One such capability is an appointment of or advice telephone line. When a customer calls a standard telephone numbers, the system routes the call to the correct service code. CRM also includes web based self service capabilities. The companies website can be set up to give the customer personalized support information as well as option to contact service staff by phone for additional assistance. Marketing
CRM support direct marketing campaigns by providing capabilities for capturing prospects and customer data, for providing product and service information, for qualifying leads for target marketing, and for scheduling and tracking direct market mailing or e-mails. Figure: how CRM supports marketing Response by channels for jan2007 promotion campaign Telephone 30.8% Web-16% Direct mail-29.2% Cell pone text message-17.3% E-Mail-6.7% Soure: CRM s/W provide a single point for users to manage and evaluate marketing campaign across multiple channels, direct mail, telephone, the web and wireless messages. (Laudon Kenneth C. and Laudon Jane P., 2008, Pearson, New Delhi, page-407)

Cross selling is the marketing of complimentary products to customers. CRM tools also help firms to manage and execute marketing campaign at all stages, from palling to determining the rate of success of each campaign. Figure illustrate the most important capabilities for sales, service and marketing processes that would be found in major CRM software products. Like Enterprise Software. This software is business driven. Figure:

CRM software capabilities Customer data Sales Marketing Service Account Mgr. Campaign Mgt. Service delivery Order mgt. Event mgt. Retruns mgt. Sales planning Mkt.planning Service planning Filed sales Mkt. operations Call centre help desk Sales analytics Mkt. Alaluyitcis Service Analytics (Laudon Kenneth C. and Laudon Jane P., 2008, Pearson, New Delhi, page-407) OPERATIONAL AND ANALYTICAL CRM Operational CRM:It includes customer facing applications, such as tools for sales force automation, call centre and customer service support and marketing automation. Analytical CRM: It includes analysis of customer data. It is based on Online analytical processing (OLAP), data mining, and other data analysis techniques. Data collectedfrom organizations may be combined with data from other soutrces, such as customer list for direct marketing campaign purchase frm other companies or demographic data. Such data are analysed to identify buying pattern , to create segment for target marketing and to pinpoing profitable customers. Another important output of CRM is Customer Lifetime value (CLTV). It is based on r Analytical CRM users the relationship between revenue produced by specific customer, expenses incurred in acquiring and servcing that customer and the company. Figure ANALYTICAL CRM WAREHOUSE Channels -call centre *profitable custometrs -website *Market segment -wireless *Customer profile -field sales Customer data warehouse ---- *Churn rates -dircet mail -mail -retail stire -partner Other Cources -Legacy system +OLAP -Demograohic data +Data Mining -Third-party data +Other data analyzing tools -Marketing campaign data Source and description: Analytical CRM uses a customer data ware house and tools to analyze customer data collected from the firms customer touch points and from other sources. Churn rate measures the number of customers who stop using or purchasing products or services from the company.

BUSINESS VALUE OF crm SYSTEMS NCREASED CUSTOMER SATISFACTION Reduced direct marketing cost More effective marketing Lower cost for customer acquisition and retention To pinpoint profitable and loss making customers GLOBAL MARKET Global consumers are interested in closuming similar product that are

culturally approved. Cocal-cola ( made in Korea but designed in Los Angles) Cable News Network ( CNN) programming can now be sold in Latic America, Africa and Asia. Frito-Lay can develop a marketing sales force automation system in USA and once provided may try the sames techniques in Spain.
(Laudon Kenneth C. and Laudon Jane P., 2008, Pearson, New Delhi, page-633)

PERSONNEL MANAGEMENT SYSTEM: Personnel management system includes: 1. Planning personnel requirements 2. Analysing performance, salary 3. Administration ( Davis, page-15) Functions of personnel management system: 1. An enquiry to a personnel file describe the requirements for a position. The computer search the employee file using preprogrammed rules to select and rank candidate. 2. A telephone order clerk taking an order enters the data online using a visual display terminal. In the case of stockout, programmed decision rule in a report processing procedure may cause issuance of special reports to provide information in problem area. An eample might be a report showing orders still outstanding after 30 days, produced as as a result of an unusually high ( the lomit pfrespecified) 30-days balance. PERSONNEL SUBSYSTEM: It includes hiring, training, record keeping, payment, and termination of personnel. The transaction result in documents describing employmentrequisitions, job description, training specifics, personnel data ( background, skill, experience), pay rate change, hours worked, paychecks, benefits and termination notices, operational control for personnel require decision procedures for actions such as hiring, training, training, termination, changing pay rates, and issuing banefits.

Date: UNIT II
The objective of developing information system are: 1. To provide the type of information environment that will integrate basic operating functions. 2. To provide management with access to information relative to complex activities in decentralized organization. Basic information system: 1. Engineering/Design 2. Production / operations 3. marketing 4. Finance/administration

5. Project Planning and control 6. Support Systems

Financial Information System: By and large, the conversion of manual financial system to computer based system is subject to less improvement as a managerial device that is other types of information systems. Example: Billing Production / operations systems:
The production and operations systems are concerned with information about the physical flow of goods and services. There are 06 characteristics of the information system that lends itself best to computer use: 1. Speed: Computers are extremely valuable if speed is required in processed data. 2. Quantity: large amount of data can be processed very quickly. 3. Repetitiveness: The more repetitive the task, the more profitable it is tio automate this task. 4. Complexity: Problems with several interacting variables can be solved quickly and accurately. 5. Exact input: Computers require inputs that are exact. Intuition and judgment are not attribute of machine. 6. Accurate output: Great accuracy can be obtained as needed; also accuracy is not affected by boredom and fatigues.

UNIT II

S26: Objectives To give bonus to employees. (programmed deices) A hotel chain with Hotels in major cities around the world is analyzing the decisions in building a hotel in a newly independent developing country. (Decision tree) People who have bought a certain make of car will tend to read the advertisement for that Car and not read competitive advertisement. Sales procedure that follow-up sales with congratulatory information make us of the bolstering effect of cognitive dissonance maker. S27: Essence of Management Whatever a manager does, he/she does it through DECISION-MAKING THUS DECISION-MAKING IS AN ESSENCE OF MANAGEMENT -Peter Drucker S28: INPUT IN DECISION MAKING For Decision Making INFORMATION is the necessary and vital input S29: data n A stream of raw facts about anything n Examples:. n Record of all the players in one day cricket matches. n Detailed Marks of all students in a class.

n Business data as obtained from various business houses. S30: Information n Processed data, which is useful to the recipient. n Examples: n Profit of the company in the current year n The highest ever score in one day cricket n First ten toppers in a class with scores. n The top 50 business houses of India. S31: Then Information is WHICH n Tells something the receiver did not know n Reduces uncertainty n Has a surprise value n Has a real / perceived value in current / prospective decision. S32:

Data and Information

S33: Phases in decision making Intelligence- Searching the environment for conditions calling for decision. Data inputs are obtained, processed, and examined for clues that may identify problems or opportunities. Design Inventing, developing and analyzing possible courses of action. This involves a process to understand the problem, to generate solution, and to test solution for feasibility. Choice- Selecting an alternative course of action from those available. A choice is made and implemented. (Davis, pp-164) S34: Intelligence a design Phases: Problem finding Find a different between some existing situation and some desired state. Pounds identified four models 1. Historical model: In which expectation is based on an extrapolation of past experience. Eg. Airtel billing 2. Planning: In which plan is the expectation.eg. product innovation 3. Models of people in the organization, which as superiors, subordinates etc. e.g. simulate JRDs steps 4. Extra-organisational models: Expectations are derived from other organizations.eg. market survey like Vodaphone.

S35: Problem Formulation: To clarify the problem, so that design and choice activities operate on the right problem. Taylor identified 04 strategies: i. Determining the boundaries of the problem i.e. clearly identify what is included in the problem. Eg.BTM ii. Examining changes that may have precipitated the problem. iii. Factoring the problem into smaller sub problem.soft.designing iv. Focusing on controllable elements. Hypothesis.

S36: Development of alternatives: Requires adequate knowledge of the problem areas and its boundaries (domain knowledge) S37: Concept of Decision making Decisions differ in a number of ways. These differences affect the design of information system support for decision making. Four dimensions of decision types which are useful for information systems are:1. Knowledge of outcomes 2. Level of programming 3. Criteria for decision 4. Level of Decision impact S38: Knowledge of outcomes What will happen if particular alternative or course of action is chosen? It is important when there is multiple numbers of alternatives. S39: Knowledge of outcomes Outcome state Explanation Certainty Complete and accurate knowledge of the outcome of each alternative. There is only one outcome for each alternative. E.g. less expensive brand provided other things are same. Risk Multiple suitable outcomes of each alternative can be identified, and a probability of occurrence can be attached to each. uncertainty Multiple outcomes for each alternative can be identified, but there is no knowledge of the probability to be attached to each.

S40: Level of programming Programmed- Ability of the organization or individual to preplan the process to make decision. o Decisions pre-specified by set of rules. o Decision making under certainty. o Delegated to lower level. Non-programmedo No pre-established decision rule. S41: Criteria for decision making Normative or prescriptive- How to make a class of decisions. Maximization or optimization of utility or expected value. Descriptive- How decision maker actually make decisions. Attempts to explain actual behaviour.

(Davis, pp-169)

S42: Decision Support System I.T. can be used to support decision making in the organization as well as process transactions. Managers running spreadsheet programme on their microcomputer to decide whether to launch a new product or particular investment are using computer for decision support. (Lucas, 1990, Information Systems Concepts for management, McGraw Hills, pp47)

Decision making can be regarded as an outcome of mental processes (cognitive process) leading to the selection of a course of action among several alternatives. Every decision making process produces a final choice. [James Reason (1990). Human Error. Ashgate. ISBN 1840141042.] The output can be an action or an opinion of choice. (www.wikopeida.com, search key: decisions making, 13/02/2009) S29: DECISION MAKING AND ROLE OF MIS n To select one alternative out of various alternatives. S30: Decision making is an essential element of management Information system is basically helps in decision making in the light of relevant information available to the manager. Decision can be divided in to following

classes:n Programmed and non-programmed decisions. n Historical versus current decisions. n Strategic versus operational decisions Programme: a string of instructions to accomplish an assignment. (Murdick Robert G., Ross, Claggett, 2006) Decisions lend themselves into programming technique if they are repetitive and routine and if procedure can work out for handling them so that each is neither can be worked out for handling them so that each is neither an ad hoc decision or nor on to be treated as a new situation each time it arises. (Murdick Robert G., Ross, Claggett, 2006) Decision are non-programmed to the extent that they are unstructured, new, of high consequence, elusive, or complex, or involve major commitments, advertising budgets, new product decisions, acquisition and merger consideration, board member selection, and similar problems illustrate the non-programmaed type decision that cannot be automated. (Murdick Robert G., Ross, Claggett, 2006)

S31: Method of Decision making Type of Decision Old New Programmed Habit (stadnrad MIS ( includes mgt. operating procedure Sc. Techniques and Organization Structure the computer) Policy etc) Non-programmed Judgment, Intuition, Systematic approach One shot ill Insight Experience, to Problem Solving & structured Training and Learning Decisions Making (Murdick Robert G., Ross, Claggett, 2006, page-190)

S32: Managers and decisions making n Operational control: Determines how to perform specific tasks set by strategic and middle-management decision makers n Knowledge-level decision making: Evaluates new ideas for products, services, ways to communicate new knowledge, ways to distribute information S31: Decisions are classified as: n Unstructured: Non routine, decision maker provides judgment, evaluation, and insights into problem definition, no agreed-upon procedure for decision making n Structured: Repetitive, routine, handled using a definite procedure
S32: Decision making processes: According to behavioralist Isabel Briggs Myers, a person's

decision making process depends on a significant degree on their cognitive style.

(Source: Isabel Briggs Myers|Myers, I. (1962) Introduction to Type: A description of the theory and applications of the Myers-Briggs type indicator, Consulting Psychologists Press, Palo Alto Ca., 1962. ) Myers developed a set of four bi-polar dimensions, called the Myers Briggs Type Indicator (MBTI). The terminal points on these dimensions are: thinking and feeling; extroversion and introversion; judgment and perception; and sensing and intuition. She claimed that a person's decision making style is based largely on how they score on these four dimensions. For example, someone who scored near the thinking, extroversion, sensing, and judgment ends of the dimensions would tend to have a logical, analytical, objective, critical, and empirical decision making style. Other studies suggest that these national or cross-cultural differences exist across entire societies. For example, Maries Martinsons has found that American, Japanese and Chinese business leaders each exhibit a distinctive national style of decision making.

( Source: Martinsons, Maris G., Comparing the Decision Styles of American, Chinese and Japanese Business Leaders. Best Paper Proceedings of Academy of Management Meetings, Washington, DC, August 2001) Some of the decision making techniques that we use in everyday life include:

listing the advantages and disadvantages of each option, popularized by Plato and Benjamin Franklin Flipping a coin, cutting a deck of playing cards, and other random or coincidence methods accepting the first option that seems like it might achieve the desired result Prayer, Tarot astrology, revelation or other forms of divination. acquiesce to a person in authority or an "expert" choosing the alternative with the highest probability-weighted utility for each alternative (see Decisions analysis.)

EVOLUTIN OF IS: RESONS: Computer makes programmed decisions Computer can provide assiting information or comples decisions In a decision 90% information and 10% decisions.

Introduction to Decision Making Pareto Analysis - Choosing which changes to make Paired Comparison - Working out relative importances Grid Analysis - Making a choice balancing many factors PMI - Weighing the pros and cons of a decision Force Field Analysis - Analyzing pressures for and against change Six Thinking Hats - Looking at all points of view Starbursting - Understanding new ideas by brainstorming questions

Stepladder Technique - Making better group decisions Cost/Benefit Analysis - Simple financial decision making Cash Flow Forecasting - Testing the viability of a financial decision Decision Trees - Choosing by projecting possible outcomes

( Source: http:// www.mindtools. com/pages/ main/ new MN_TED.htm, 04th Feb. 2009) Decision making process-stages in decision making,
Decision making can be regarded as an outcome of mental processes (cognitive process) leading to the selection of a course of action among Decision theory in mathematics and statistics is concerned with identifying the tests of the kind of decision-making that occurs in practice. 25 Decision making Decision making is an essential element of management,. Information system is basically helps in decision making in the light of relevant information available to the manager. Decision can be divided in to following classes:n Programmed and non-programmed decisions. n Historical versus current decisions. n Strategic versus operational decisions

Individual and organizational; Decision making models; Information system support for decision making phases; definition, Characteristics,
26 Characteristics - MIS n It deals effectively with increased complexity of Management n It helps to take better decisions due to the ability to obtain, store, process, retrieve, and display the right information for the right decision. n It keeps information feedback system n It builds foundation to decision making. n It helps to control organization efficiently.

Subsystem of MIS, MIS and top management, Structure of MIS (conceptual and physical structure)

UNIT III

MIS planning and control; MIS master plan-content and description:

Nolan stage model, three stage model of planning process- the strategic planning stage, organizational information requirement analysis and resource allocation stage; Myths of MIS, Pitfalls of MIS, Limitations of MIS

UNIT-IV
Decision Support System-definition, Relationship with MIS, Evolution of DSS; characteristics, Classification, Objectives, Components, functions and development of DSS;

Artificial intelligence for MIS problems-use of expert systems, use of neural networks.

UNIT-V Emerging concepts and issue in information systems- supply chain management, Customer relationship management, ERP; Introduction to data warehousing, Data mining and its application, Emerging concepts in information system design and applications;

E-commerce, B-to-B, B2C transactions; Security issue, EDI-format, International protocol etc.

A Management information System (MIS) is an integrated man-machine system that provides information to support the planning and control functions of managers is an organization.

The output of MIS sub serves managerial functions. If a system provides information to persons who are not managers we will not consider it as apart of an MIS. E.g. Income tax statement, salary disclosure, excise duty statement. Computer aided design system for engineering purpose. ( Kanter)

An MIS deals with information that is systematically and routinely collected in accordance with a well defined set of rules. This implies that MIS is a part of the formal network in an organization. ( Davis)

The information provided my MIS assist managers to make planning and control decisions. e.g. How many and what types of Cars to make next month or what commission to offer to retailers.

If the system per se provides only information to support operations and has no managerial decision-making significance. It is not the part of MIS. e.g. A wholesaler has a computer system to send out bills to his retailer.

An MIS include all the ingredients that are employed in providing information support to managers in making planning and control decisions. Managers often use historical data on an organizations activities as-well-as current status data to make planning and control decisions. Such data comes from a data base wish is contained in files (paper or electronics) maintained by the organization. This database is an essential component of MIS. MIS is

Subserve managerial function Collects information systematically Supports planning and control decision Includes files, hardware, software and operations research models.

Management Information System (MIS) is a subset of the overall internal controls of a business covering the application of people, documents, technologies, and procedures by management accountants to solving business problems such as costing a product, service or a business-wide

strategy. Management Information Systems are distinct from regular information systems in that they are used to analyze other information systems applied in operational activities in the organization.[1] Academically, the term is commonly used to refer to the group of information management methods tied to the automation or support of human decision making, e.g. Decision Support Systems, Expert systems, and Executive information systems.[1] ( a b OBrien, J (1999). Management Information Systems Managing Information Technology in the Internetworked Enterprise. Boston: Irwin McGraw-Hill. ISBN 0071123733.)

'MIS' is a planned system of the collecting, processing, storing and disseminating data in the form of information needed to carry out the functions of management. According to Phillip Kotler "A marketing information system consists of people, equipment, and procedures to gather, sort, analyze, evaluate, and distribute needed, timely, and accurate information to marketing decision makers." (Kotler, Phillip and Keller, Kevin Lane; Marketing Management, Pearson Education, 12 Ed, 2006)

The terms MIS and INFORMATION SYSTEM are often confused. Information systems include systems that are not intended for decision making. MIS is sometimes referred to, in a restrictive sense, as information technology management. That area of study should not be confused with computer science. IT service management Resource Planning is a practitioner-focused discipline. MIS has also some differences with Enterprise Resource Planning (ERP) as ERP incorporates elements that are not necessarily focused on decision support.

Professor Allen S. Lee states that "...research in the information systems field examines more than the technological system, or just the social system, or even the two side by side; in addition, it investigates the phenomena that emerge when the two interact." [2]. (^ Lee, AS (2001). "Editors Comments". MIS Quarterly 25 (1): iii-vii.)

WHY DO WE GO FOR THESE FOUR APPROACHES o BETTER STRATEGIC PLANNING (ROBERT ANTHONYS) o MANAGEMENT CONTROL (ROBERT ANTHONYS) o OPERATIONAL CONTROL (ROBERT ANTHONYS) o AVAILABLE INFORMATION SOURCES (ZANI) o COMPANY STRATEGY (W. S. ZANI, 1973, A BLUE PRINT FOR MIS, HBR) o COMPANY STRUCTURE (ZANI) o OPPORTUNITY AND RISK (ZANI) WHAT IS INFROMATION? CLASSIFICATION OF INFORMATION o ACTION VS NON ACTION o RECURRING VS NON RECURRING o DOCUMENTRY VS NONDOCUMENTRY o INTERNAL VS EXTERNAL o HISTORICAL VS FUTURE

INFORMATION ECONOMICS o HARDWARE COST o SYSTEM ANALYSIS, DESIGN AND IMPLEMENTATION COSTS o CONVERSION COSTS o COST FOR SPACE, AND ENVIRONMENT CONTROL COST o OPERATION COST VALUE OF INFROMATION o FORM UTILITY o TIME UTILITY o PLACE (ACCESSIIBILTY) UTILITY o POSSESSION (ORGANISANAL) UTILITY INFORMATION vis a vis DATA KNOWLEDGE COMPUTERS SOFTWARE AND HARDWARE TYPES AND COPONENTS OF COMPUTER SYSTEM HUMAN COMPUTER INTERFACE o OPERATING SYSTEMS o UNIX, LINUX, DOS, WINDOWS o NETWORKING AND STANDALONE HARDWARE ACQUISITION o STANDARDS o FINANCIAL IMPLICATIONS SOFTWARE o PROGRAMMING LANGUAGES TYPES STRUCTURED OBJECT ORIENTED LOGICAL SYSTEMS APPLICATION o ENVIRONMENTS MULTIPROGRAMMING TIME SHARING MULTIPROCESSING PARALLEL PROCESSING DBMS o FILE o STRUCTURE o ONLINE TRANSACTION PROCESSING o BATCH PROCESSING o CONCEPT OF DBMS o DATA WAREHOUSING o DATA MINIING o ONLINE ANALYTICAL PROCESSING (OLAP) COMMUNICATION SYSTEMS NEED FOR NETWORK LAN/MAN/WAN/ ENTERPRISE NETWROK INTRANET/ EXTRANET/INTERNET/EDI COMPUTER

NEED FOR INFORMATION SYSTEM: 1) Education and Research a. To keep up new developments in this area b. To get acquire state of the art c. To get specific pieces of data and information needed at different stages of his work DEVELOPMENT OF INFROMATION SYSTEMS a. SYSTEM ANALYSIS AND DESIGN b. ALTERNATIVE APPLICATION DEVELOPMENT APPROACHES APPLICATION OF INFROMATION SYSTEMS TO FUNCTIONAL BUSINESS AREA a. OPERATIONAL; TACTICAL, STRATEGIC PLANNING INFORMATION SYSTEMS MANAGEMENT IFNROMATION SYSTEMS a. EVALUATION OF INFROMATION SYSTEM b. INFORMATION SYSTEMS SECURITY c. INTTELTUAL PROPERTY ISSUES

THE COMPUTER IN THE RESTAURANT The restarant if a minicopmputer based information systems has enbled IITTMs Restarent in Gwalior to streamline their operations and promote tighter controls over their business. A waiter takes an order at the table, and then enters it online via one of the siox terminals located in the restarants dining room. The order is routed to a printer in the appropriate preparation area: the cold-item printer if it is salad, the hot item printer if it is hot sandwich, or the bar printer it it is a drinhk. A customers meal check listing the items ordered and the respective prices is automatically generated. This odering system eliminates the old three carbon copy gust book check system as-well-as any problem caused by waiters handwriting. When the kitchen runs out of a food item, the cook send an out of stick message, which will be displayed on the dining -----------------------------------------------------------------------------1. Explain in your own words the relationships: MIS to DSS MIS to IRM MIS to data processing MIS to computer science 2. What are functions commonly found in IS for: Manufacturing company A departmental store 3. A person who knows all about computer hardware, software and programming may not be suited to design computer based MIS. Why not? 4. Explain the concept of integrated systems? 5. Why is a database generally a feature of an MIS? S57: Task-D/L 27-02-09: Go to the website www.avnet.com and identify (a) How many countries it operates in. ( b) how its

revenues are divided among the major regions in North America, Europe and Asia. ( Ref.: Laudon K.C., Laudon J.P., 2008,MIS Managing the digital firm, Pearson, pp-640) S67: Create a database of students in your class. Generate queries to find out number of students expecting to join in Delhi for summer training. Identify the type of decision support system, you are working.

SCM
Supply chain management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers (Harland, 1996). Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point-of-origin to point-ofconsumption (supply chain). The definition one American professional association put forward is that Supply Chain Management encompasses the planning and management of all activities involved in sourcing, procurement, conversion, and logistics management activities. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers. In essence, Supply Chain Management integrates supply and demand management within and across companies. More recently, the loosely coupled, self-organizing network of businesses that cooperates to provide product and service offerings has been called the Extended Enterprise.[1] Supply Chain Management can also refer to Supply chain management software which are tools or modules used in executing supply chain transactions, managing supplier relationships and controlling associated business processes. Supply chain event management (abbreviated as SCEM) is a consideration of all possible occurring events and factors that can cause a disruption in a supply chain. With SCEM possible scenarios can be created and solutions can be planned. SCM PROBLEMS: Supply chain management must address the following problems:

Distribution Network Configuration: Number, location and network missions of suppliers, production facilities, distribution centers, warehouses, cross-docks and customers. Distribution Strategy: Including questions of operating control (centralized, decentralized or shared); delivery scheme (e.g., direct shipment, pool point shipping, Cross docking, DSD (direct store delivery), closed loop shipping); mode of transportation (e.g., motor carrier, including truckload, LTL, parcel; railroad; intermodal, including TOFC and COFC; ocean freight; airfreight); replenishment strategy (e.g., pull, push or hybrid); and transportation control (e.g., owner-operated, private carrier, common carrier, contract carrier, or 3PL). Trade-Offs in Logistical Activities

The above activities must be coordinated well together in order to achieve the least total logistics cost. Trade-offs exist that increase the total cost if only one of the activities is optimized. For example, full truckload (FTL) rates are more economical on a cost per pallet basis than less than truckload (LTL) shipments. If, however, a full truckload of a product is ordered to reduce transportation costs there will be an increase in inventory holding costs which may increase total

logistics costs. It is therefore imperative to take a systems approach when planning logistical activities. These trade-offs are key to developing the most efficient and effective Logistics and SCM strategy.

Information: Integration of and other processes through the supply chain to share valuable information, including demand signals, forecasts, inventory, transportation, and potential collaboration etc. Inventory Management: Quantity and location of inventory including raw materials, workin-progress (WIP) and finished goods. Cash-Flow: Arranging the payment terms and the methodologies for exchanging funds across entities within the supply chain.

Supply chain execution is managing and coordinating the movement of materials, information and funds across the supply chain. The flow is bi-directional. ACTIVITIES/FUNCTIONS: Supply chain management is a cross-functional approach to manage the movement of raw materials into an organization, certain aspects of the internal processing of materials into finished goods, and then the movement of finished goods out of the organization toward the endconsumer. As organizations strive to focus on core competencies and becoming more flexible, they have reduced their ownership of raw materials sources and distribution channels. These functions are increasingly being outsourced to other entities that can perform the activities better or more cost effectively. The effect is to increase the number of organizations involved in satisfying customer demand, while reducing management control of daily logistics operations. Less control and more supply chain partners led to the creation of supply chain management concepts. The purpose of supply chain management is to improve trust and collaboration among supply chain partners, thus improving inventory visibility and improving inventory velocity. Several models have been proposed for understanding the activities required to manage material movements across organizational and functional boundaries. SCOR is a supply chain management model promoted by the Supply Chain Management Council. Another model is the SCM Model proposed by the Global Supply Chain Forum (GSCF). Supply chain activities can be grouped into strategic, tactical, and operational levels of activities. STRATGEIC Strategic network optimization, including the number, location, and size of warehouses, distribution centers, and facilities Strategic partnership with suppliers, distributors, and customers, creating communication channels for critical information and operational improvements such as cross docking, direct shipping, and third-party logistics Product lifecycle management, so that new and existing products can be optimally integrated into the supply chain and capacity management Information Technology infrastructure, to support supply chain operations Where-to-make and what-to-make-or-buy decisions Aligning overall organizational strategy with supply strategy TECTICAL Sourcing contracts and other purchasing decisions. Production decisions, including contracting, scheduling, and planning process definition. Inventory decisions, including quantity, location, and quality of inventory.

Transportation strategy, including frequency, routes, and contracting. Benchmarking of all operations against competitors and implementation of best practices throughout the enterprise. Milestone payments Focus on customer demand. OPERATIONAL

Daily production and distribution planning, including all nodes in the supply chain. Production scheduling for each manufacturing facility in the supply chain (minute by minute). Demand planning and forecasting, coordinating the demand forecast of all customers and sharing the forecast with all suppliers. Sourcing planning, including current inventory and forecast demand, in collaboration with all suppliers. Inbound operations, including transportation from suppliers and receiving inventory. Production operations, including the consumption of materials and flow of finished goods. Outbound operations, including all fulfillment activities and transportation to customers. Order promising, accounting for all constraints in the supply chain, including all suppliers, manufacturing facilities, distribution centers, and other customers.

SCM
Organizations increasingly find that they must rely on effective supply chains, or networks, to successfully compete in the global market and networked economy.[2] In Peter Drucker's (1998) new management paradigms, this concept of business relationships extends beyond traditional enterprise boundaries and seeks to organize entire business processes throughout a value chain of multiple companies. During the past decades, globalization, outsourcing and information technology have enabled many organizations, such as Dell and Hewlett Packard, to successfully operate solid collaborative supply networks in which each specialized business partner focuses on only a few key strategic activities (Scott, 1993). This inter-organizational supply network can be acknowledged as a new form of organization. However, with the complicated interactions among the players, the network structure fits neither "market" nor "hierarchy" categories (Powell, 1990). It is not clear what kind of performance impacts different supply network structures could have on firms, and little is known about the coordination conditions and trade-offs that may exist among the players. From a systems perspective, a complex network structure can be decomposed into individual component firms (Zhang and Dilts, 2004). Traditionally, companies in a supply network concentrate on the inputs and outputs of the processes, with little concern for the internal management working of other individual players. Therefore, the choice of an internal management control structure is known to impact local firm performance (Mintzberg, 1979). In the 21st century, changes in the business environment have contributed to the development of supply chain networks. First, as an outcome of globalization and the proliferation of multinational companies, joint ventures, strategic alliances and business partnerships, there were found to be significant success factors, following the earlier "Just-In-Time", "Lean Manufacturing" and "Agile Manufacturing" practices.[3] Second, technological changes, particularly the dramatic fall in information communication costs, which are a significant component of transaction costs, have led to changes in coordination among the members of the supply chain network (Coase, 1998).

Many researchers have recognized these kinds of supply network structures as a new organization form, using terms such as "Keiretsu", "Extended Enterprise", "Virtual Corporation", "Global Production Network", and "Next Generation Manufacturing System".[4] In general, such a structure can be defined as "a group of semi-independent organizations, each with their capabilities, which collaborate in ever-changing constellations to serve one or more markets in order to achieve some business goal specific to that collaboration" (Akkermans, 2001). The security management system for supply chain is described in ISO/IEC 28000 and ISO/IEC 28001 and related standards published jointly by ISO and IEC. DEVELOPMENT Six major movements can be observed in the evolution of supply chain management studies: Creation, Integration, and Globalization (Lavassani et al., 2008 a), Specialization Phases One and Two, and SCM 2.0. 1. Creation Era The term supply chain management was first coined by an American industry consultant in the early 1980s. However the concept of supply chain in management, was of great importance long before in the early 20th century, especially by the creation of the assembly line. The characteristics of this era of supply chain management include the need for large scale changes, reengineering, downsizing driven by cost reduction programs, and widespread attention to the Japanese practice of management. 2. Integration Era This era of supply chain management studies was highlighted with the development of Electronic Data Interchange (EDI) systems in the 1960s and developed through the 1990s by the introduction of Enterprise Resource Planning (ERP) systems. This era has continued to develop into the 21st century with the expansion of internet-based collaborative systems. This era of SC evolution is characterized by both increasing value-added and cost reduction through integration. 3. Globalization Era The third movement of supply chain management development, globalization era, can be characterized by the attention towards global systems of supplier relations and the expansion of supply chain over national boundaries and into other continents. Although the use of global sources in the supply chain of organizations can be traced back to several decades ago (e.g. the oil industry), it was not until the late 1980s that a considerable number of organizations started to integrate global sources into their core business. This era is characterized by the globalization of supply chain management in organizations with the goal of increasing competitive advantage, creating more value-added, and reducing costs through global sourcing. 4. Specialization Era -- Phase One -- Outsourced Manufacturing and Distribution In the 1990s industries began to focus on core competencies and adopted a specialization model. Companies abandoned vertical integration, sold off non-core operations, and outsourced those functions to other companies. This changed management requirements by extending the supply chain well beyond the four walls and distributing management across specialized supply

chain partnerships. This transition also refocused the fundamental perspectives of each respective organization. OEMs became brand owners that needed deep visibility into their supply base. They had to control the entire supply chain from above instead of from within. Contract manufacturers had to manage bills of material with different part numbering schemes from multiple OEMs and support customer requests for work -in-process visibility and vendor-managed inventory (VMI). The specialization model creates manufacturing and distribution networks composed of multiple, individual supply chains specific to products, suppliers, and customers who work together to design, manufacture, distribute, market, sell, and service a product. The set of partners may change according to a given market, region, or channel, resulting in a proliferation of trading partner environments, each with its own unique characteristics and demands. 5. Specialization Era -- Phase Two -- Supply Chain Management as a Service Specialization within the supply chain began in the 1980s with the inception of transportation brokerages, warehouse management, and non asset based carriers and has matured beyond transportation and logistics into aspects of supply planning, collaboration, execution and performance management. At any given moment, market forces could demand changes within suppliers, logistics providers, locations, customers and any number of these specialized participants within supply chain networks. This variability has significant effect on the supply chain infrastructure, from the foundation layers of establishing and managing the electronic communication between the trading partners to the more-complex requirements, including the configuration of the processes and work flows that are essential to the management of the network itself. Supply chain specialization enables companies to improve their overall competencies in the same way that outsourced manufacturing and distribution has done; it allows them to focus on their core competencies and assemble networks of best in class domain specific partners to contribute to the overall value chain itself thus increasing overall performance and efficiency. The ability to quickly obtain and deploy this domain specific supply chain expertise without developing and maintaining an entirely unique and complex competency in house is the leading reason why supply chain specialization is gaining popularity. Outsourced technology hosting for supply chain solutions debuted in the late 1990s and has taken root in transportation and collaboration categories most dominantly. This has progressed from the Application Service Provider (ASP) model from approximately 1998 through 2003 to the On-Demand model from approximately 2003-2006 to the Software as a Service (SaaS) model we are currently focused on today. 6. Supply Chain Management 2.0 (SCM 2.0) Building off of globalization and specialization, SCM 2.0 has been coined to describe both the changes within the supply chain itself as well as the evolution of the processes, methods and tools that manage it in this new "era". Web 2.0 is defined as a trend in the use of the World Wide Web that is meant to increase creativity, information sharing, and collaboration among users. At its core, the common attribute

that Web 2.0 brings is it helps us navigate the vast amount of information available on the web to find what we are looking for. It is the notion of a usable pathway. SCM 2.0 follows this notion into supply chain operations. It is the pathway to SCM results the combination of the processes, methodologies, tools and delivery options to guide companies to their results quickly as the complexity and speed of the supply chain increase due to the effects of global competition, rapid price flucuations, surging oil prices, short product life cycles, expanded specialization, near/far and off shoring, and talent scarcity. SCM 2.0 leverages proven solutions designed to rapidly deliver results with the agility to quickly manage future change for continuous flexibility, value and success. This is delivered through competency networks composed of best of breed supply chain domain expertise to understand which elements, both operationally and organizationally, are the critical few that deliver the results as well as the intimate understanding of how to manage these elements to achieve desired results, finally the solutions are delivered in a variety of options as no-touch via business process outsourcing, mid-touch via managed services and software as a service (SaaS), or high touch in the traditional software deployment model. Successful SCM requires a change from managing individual functions to integrating activities into key supply chain processes. An example scenario: the purchasing department places orders as requirements become appropriate. Marketing, responding to customer demand, communicates with several distributors and retailers as it attempts to satisfy this demand. Shared information between supply chain partners can only be fully leveraged through process integration. Supply chain business process integration involves collaborative work between buyers and suppliers, joint product development, common systems and shared information. According to Lambert and Cooper (2000) operating an integrated supply chain requires continuous information flow. However, in many companies, management has reached the conclusion that optimizing the product flows cannot be accomplished without implementing a process approach to the business. The key supply chain processes stated by Lambert (2004) [5] are:

Customer relationship management Customer service management Demand management Order fulfillment Manufacturing flow management Supplier relationship management Product development and commercialization Returns management

Much has been written about demand management. Best in Class companies have similar characteristics. They include the following: a) Internal and external collaboration b) Lead time reduction initiatives c) Tighter feedback from customer and market demand d) Customer level forecasting HelgaHere (talk) 20:44, 25 February 2009 (UTC) <Aberdeen Group Demand Management in Discrete Industries: Order to Delivery Excellence November 2007>

One could suggest other key critical supply business processes combining these processes

stated by Lambert such as: a. Customer service management b. Procurement c. Product development and commercialization d. Manufacturing flow management/support e. Physical distribution f. Outsourcing/partnerships g. Performance measurement a) Customer service management process Customer Relationship Management concerns the relationship between the organization and its customers. Customer service provides the source of customer information. It also provides the customer with real-time information on promising dates and product availability through interfaces with the company's production and distribution operations. Successful organizations use following steps to build customer relationships: determine mutually satisfying goals between organization and customers establish and maintain customer rapport produce positive feelings in the organization and the customers b) Procurement process Strategic plans are developed with suppliers to support the manufacturing flow management process and development of new products. In firms where operations extend globally, sourcing should be managed on a global basis. The desired outcome is a win-win relationship, where both parties benefit, and reduction times in the design cycle and product development are achieved. Also, the purchasing function develops rapid communication systems, such as electronic data interchange (EDI) and Internet linkages to transfer possible requirements more rapidly. Activities related to obtaining products and materials from outside suppliers requires performing resource planning, supply sourcing, negotiation, order placement, inbound transportation, storage, handling and quality assurance, many of which include the responsibility to coordinate with suppliers in scheduling, supply continuity, hedging, and research into new sources or programmes. c) Product development and commercialization Here, customers and suppliers must be united into the product development process, thus to reduce time to market. As product life cycles shorten, the appropriate products must be developed and successfully launched in ever shorter time-schedules to remain competitive. According to Lambert and Cooper (2000), managers of the product development and commercialization process must: 1. coordinate with customer relationship management to identify customer-articulated needs; 2. select materials and suppliers in conjunction with procurement, and 3. develop production technology in manufacturing flow to manufacture and integrate into the best supply chain flow for the product/market combination. d) Manufacturing flow management process The manufacturing process is produced and supplies products to the distribution channels based on past forecasts. Manufacturing processes must be flexible to respond to market changes, and

must accommodate mass customization. Orders are processes operating on a just-in-time (JIT) basis in minimum lot sizes. Also, changes in the manufacturing flow process lead to shorter cycle times, meaning improved responsiveness and efficiency of demand to customers. Activities related to planning, scheduling and supporting manufacturing operations, such as work-inprocess storage, handling, transportation, and time phasing of components, inventory at manufacturing sites and maximum flexibility in the coordination of geographic and final assemblies postponement of physical distribution operations. e) Physical distribution This concerns movement of a finished product/service to customers. In physical distribution, the customer is the final destination of a marketing channel, and the availability of the product/service is a vital part of each channel participant's marketing effort. It is also through the physical distribution process that the time and space of customer service become an integral part of marketing, thus it links a marketing channel with its customers (e.g. links manufacturers, wholesalers, retailers). f) Outsourcing/partnerships This is not just outsourcing the procurement of materials and components, but also outsourcing of services that traditionally have been provided in-house. The logic of this trend is that the company will increasingly focus on those activities in the value chain where it has a distinctive advantage and everything else it will outsource. This movement has been particularly evident in logistics where the provision of transport, warehousing and inventory control is increasingly subcontracted to specialists or logistics partners. Also, to manage and control this network of partners and suppliers requires a blend of both central and local involvement. Hence, strategic decisions need to be taken centrally with the monitoring and control of supplier performance and day-to-day liaison with logistics partners being best managed at a local level. g) Performance measurement Experts found a strong relationship from the largest arcs of supplier and customer integration to market share and profitability. By taking advantage of supplier capabilities and emphasizing a long-term supply chain perspective in customer relationships can be both correlated with firm performance. As logistics competency becomes a more critical factor in creating and maintaining competitive advantage, logistics measurement becomes increasingly important because the difference between profitable and unprofitable operations becomes more narrow. A.T. Kearney Consultants (1985) noted that firms engaging in comprehensive performance measurement realized improvements in overall productivity. According to experts internal measures are generally collected and analyzed by the firm including 1. 2. 3. 4. 5. Cost Customer Service Productivity measures Asset measurement, and Quality.

External performance measurement is examined through customer perception measures and "best practice" benchmarking, and includes 1) customer perception measurement, and 2) best practice benchmarking. Components of Supply Chain Management are 1. Standardization 2.

Postponement 3. Customization

Theories of Supply Chain Management


Currently there exists a gap in the literature available in the area of supply chain management studies, on providing theoretical support for explaining the existence and the boundaries of supply chain management. Few authors such as Halldorsson, et al. (2003), Ketchen and Hult (2006) and Lavassani, et al. (2008b) had tried to provide theoretical foundations for different areas related to supply chain with employing organizational theories. These theories includes:

Resource-based view (RBV) Transaction Cost Analysis (TCA) Knowledge-based view (KBV) Strategic Choice Theory (SCT) Agency theory (AT) Institutional theory (InT) Systems Theory (ST) Network Perspective (NP)

Components of Supply Chain Management Integration


The management components of SCM The SCM components are the third element of the four-square circulation framework. The level of integration and management of a business process link is a function of the number and level, ranging from low to high, of components added to the link (Ellram and Cooper, 1990; Houlihan, 1985). Consequently, adding more management components or increasing the level of each component can increase the level of integration of the business process link. The literature on business process reengineering,[6] buyer-supplier relationships,[7] and SCM[8] suggests various possible components that must receive managerial attention when managing supply relationships. Lambert and Cooper (2000) identified the following components which are:

Planning and control Work structure Organization structure Product flow facility structure Information flow facility structure Management methods Power and leadership structure Risk and reward structure Culture and attitude

However, a more careful examination of the existing literature[9] will lead us to a more comprehensive structure of what should be the key critical supply chain components, the "branches" of the previous identified supply chain business processes, that is, what kind of relationship the components may have that are related with suppliers and customers accordingly. Bowersox and Closs states that the emphasis on cooperation represents the synergism leading to the highest level of joint achievement (Bowersox and Closs, 1996). A primary level channel participant is a business that is willing to participate in the inventory ownership responsibility or

assume other aspects of financial risk, thus including primary level components (Bowersox and Closs, 1996). A secondary level participant (specialized), is a business that participates in channel relationships by performing essential services for primary participants, thus including secondary level components, which are in support of primary participants. Third level channel participants and components that will support the primary level channel participants, and which are the fundamental branches of the secondary level components, may also be included. Consequently, Lambert and Cooper's framework of supply chain components does not lead us to the conclusion about what are the primary or secondary (specialized) level supply chain components (see Bowersox and Closs, 1996, p.g. 93). That is, what supply chain components should be viewed as primary or secondary, how these components should be structured in order to have a more comprehensive supply chain structure, and to examine the supply chain as an integrative one (See above sections 2.1 and 3.1).

Reverse Supply Chain Reverse logistics is the process of planning, implementing and controlling the efficient, effective inbound flow and storage of secondary goods and related information opposite to the traditional supply chain direction for the purpose of recovering value or proper disposal. Reverse logistics is also referred to as "Aftermarket Customer Services". In other words, anytime money is taken from a company's Warranty Reserve or Service Logistics budget, that is a Reverse Logistics operation.

References
1. ^ "Definition of Terms". A Management Consultant @ Large. http://jpfarrell.blogspot.com/. 2. 3. 4. 5. 6. 7. 8. 9.
Retrieved on 2008-02-27. ^ Baziotopoulos, 2004 ^ MacDuffie and Helper, 1997; Monden, 1993; Womack and Jones, 1996; Gunasekaran, 1999 ^ Drucker, 1998; Tapscott, 1996; Dilts, 1999 ^ Lambert, Douglas M.Supply Chain Management: Processes, Partnerships, Performance, 3rd edition, 2008. ^ Macneil ,1975; Williamson, 1974; Hewitt, 1994 ^ Stevens, 1989; Ellram and Cooper, 1993; Ellram and Cooper, 1990; Houlihan, 1985 ^ Cooper et al., 1997; Lambert et al.,1996; Turnbull, 1990 ^ Zhang and Dilts, 2004 ;Vickery et al., 2003; Hemila, 2002; Christopher, 1998; Joyce et al., 1997; Bowersox and Closs, 1996; Williamson, 1991; Courtright et al., 1989; Hofstede, 1978

Further reading

Haag, S., Cummings, M., McCubbrey, D., Pinsonneault, A., & Donovan, R. (2006), Management Information Systems For the Information Age (3rd Canadian Ed.), Canada: McGraw Hill Ryerson ISBN 0-072-81947-2 Halldorsson, Arni, Herbert Kotzab & Tage Skjott-Larsen (2003). Inter-organizational theories behind Supply Chain Management discussion and applications, In Seuring, Stefan et al. (eds.), Strategy and Organization in Supply Chains, Physica Verlag. Halldorsson, A., Kotzab, H., Mikkola, J. H., Skjoett-Larsen, T. (2007). Complementary theories to supply chain management . Supply Chain Management: An International Journal, Volume 12 Issue 4 , 284-296. Handfield and Bechtel, 2001; Prater et al., 2001; Kern and Willcocks, 2000; Bowersox and

Closs, 1996; Christopher, 1992; Bowersox, 1989 Kaushik K.D., & Cooper, M. (2000). Industrial Marketing Management. Volume29, Issue 1 , January 2000, Pages 65-83 Ketchen Jr., G., & Hult, T.M. (2006). Bridging organization theory and supply chain management: The case of best value supply chains. Journal of Operations Management, 25(2) 573-580. Larson, P.D. and Halldorsson, A. (2004). Logistics versus supply chain management: an international survey. International Journal of Logistics: Research & Application, Vol. 7, Issue 1, 17-31. a Lavassani, M. K., Movahedi B., Kumar V. (2008 ) Transition to B2B e-Marketplace enabled Supply Chain: Readiness Assessment and Success Factors, Information Resources Management (Conf-IRM), 2008, Niagara, Canada. b Lavassani, M. K., Movahedi B., Kumar V. (2008 ) HISTORICAL DEVELOPMENTS IN THEORIES OF SUPPLY CHAIN MANAGEMENT: THE CASE OF B2B EMARKETPLACES. Administrative Science Association of Canada (ASAC), 2008, Halifax, Canada. Mentzer, J.T. et al (2001): Defining Supply Chain Management, in: Journal of Business Logistics, Vol. 22, No. 2, 2001, pp. 1-25 Simchi-Levi D.,Kaminsky P., Simchi-levi E. (2007), Designing and Managing the Supply Chain, third edition, Mcgraw Hill (Source: www.wikipedia.com, search key: SCM, 03/03/2009)

LOGISTIC AND SUPPLY CHAIN MANAGEMENT (SCM)


1 Supply chain management problems 2 Activities/functions 2.1 Strategic 2.2 Tactical 2.3 Operational 3 Supply chain management 4 Supply chain business process integration 5 Supply chain management components integration 6 References 7 See also Slide-176 Supply chain management (SCM) is the process of planning, implementing, and controlling the operations of the supply chain with the purpose to satisfy customer requirements as efficiently as possible. Supply chain management spans all movement and storage of raw materials, work-inprocess inventory, and finished goods from point-of-origin to point-of-consumption. The term supply chain management was coined by consultant Keith Oliver, of strategy consulting firm Booz Allen Hamilton in 1982. The definition one America professional association put forward is that Supply Chain Management encompasses the planning and management of all activities involved in sourcing, procurement, conversion, and logistics management activities. Importantly, it also includes

coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers. In essence, Supply Chain Management integrates supply and demand management within and across companies. Supply chain event management (abbreviated as SCEM) is a consideration of all possible occurring events and factors that can cause a disruption in a supply chain. With SCEM possible scenarios can be created and solutions can be planned. Some experts distinguish supply chain management and logistics, while others consider the terms to be interchangeable. Supply chain management is also a category of software products. Slide-177

Supply chain management problems


Supply chain management must address the following problems:

Distribution Network Configuration: Number and location of suppliers, production facilities, distribution centers, warehouses and customers. Distribution Strategy: Centralized versus decentralized, direct shipment, Cross docking, pull or push strategies, third party logistics. Information: Integrate systems and processes through the supply chain to share valuable information, including demand signals, forecasts, inventory and transportation etc. Inventory Management: Quantity and location of inventory including raw materials, workin-process and finished goods.

Supply chain execution is managing and coordinating the movement of materials information and funds across the supply chain. The flow is bi-directional.

Activities/functions:
Supply chain management is a cross-functional approach to managing the movement of raw materials into an organization and the movement of finished goods out of the organization toward the end-consumer. As corporations strive to focus on core competencies and become more flexible, they have reduced their ownership of raw materials sources and distribution channels. These functions are increasingly being outsourced to other corporations that can perform the activities better or more cost effectively. The effect has been to increase the number of companies involved in satisfying consumer demand, while reducing management control of daily logistics operations. Less control and more supply chain partners led to the creation of supply chain management concepts. The purpose of supply chain management is to improve trust and collaboration among supply chain partners, thus improving inventory visibility and improving inventory velocity. Several models have been proposed for understanding the activities required to manage material movements across organizational and functional boundaries. SCOR is a supply chain management model promoted by the Supply-Chain Management Council. Another model is the SCM Model proposed by the Global Supply Chain Forum (GSCF). Supply chain activities can be

grouped into strategic, tactical, and operational levels of activities.

Strategic:

Strategic network optimization, including the number, location, and size of warehouses, distribution centers and facilities. Strategic partnership with suppliers, distributors, and customers, creating communication channels for critical information and operational improvements such as cross docking, direct shipping, and third-party logistics. Product design coordination, so that new and existing products can be optimally integrated into the supply chain, load management Information Technology infrastructure, to support supply chain operations. Where to make and what to make or buy decisions Align overall organizational strategy with supply strategy

Tactical

Sourcing contracts and other purchasing decisions. Production decisions, including contracting, locations, scheduling, and planning process definition. Inventory decisions, including quantity, location, and quality of inventory. Transportation strategy, including frequency, routes, and contracting. Benchmarking of all operations against competitors and implementation of best practices throughout the enterprise. Milestone payments Daily production and distribution planning, including all nodes in the supply chain. Production scheduling for each manufacturing facility in the supply chain (minute by minute). Demand planning and forecasting, coordinating the demand forecast of all customers and sharing the forecast with all suppliers. Sourcing planning, including current inventory and forecast demand, in collaboration with all suppliers. Inbound operations, including transportation from suppliers and receiving inventory. Production operations, including the consumption of materials and flow of finished goods. Outbound operations, including all fulfillment activities and transportation to customers. Order promising, accounting for all constraints in the supply chain, including all suppliers, manufacturing facilities. distribution centers, and other customers.

Operational:

Supply chain management


Organizations increasingly find that they must rely on effective supply chains, or networks, to successfully compete in the global market and networked economy.[1] In Peter Drucker's (1998) management's new paradigms, this concept of business relationships extends beyond traditional enterprise boundaries and seeks to organize entire business processes throughout a value chain of multiple companies. During the past decades, globalization, outsourcing and information technology have enabled

many organizations such as Dell and Hewlett Packard, to successfully operate solid collaborative supply networks in which each specialized business partner focuses on only a few key strategic activities (Scott, 1993). This inter-organizational supply network can be acknowledged as a new form of organization. However, with the complicated interactions among the players, the network structure fits neither "market" nor "hierarchy" categories (Powell, 1990). It is not clear what kind of performance impacts different supply network structures could have on firms, and little is known about the coordination conditions and trade-offs that may exist among the players. From a system's point of view, a complex network structure can be decomposed into individual component firms (Zhang and Dilts, 2004). Traditionally, companies in a supply network concentrate on the inputs and outputs of the processes, with little concern for the internal management working of other individual players. Therefore, the choice of internal management control structure is known to impact local firm performance (Mintzberg, 1979). In the 21st century, there have been few changes in business environment that have contributed to the development of supply chain networks. First, as an outcome of globalization and proliferation of multi-national companies, joint ventures, strategic alliances and business partnerships were found to be significant success factors, following the earlier "Just-In-Time", "Lean Management" and "Agile Manufacturing" practices.[2] Second, technological changes, particularly the dramatic fall in information communication costs, a paramount component of transaction costs, has led to changes in coordination among the members of the supply chain network (Coase, 1998). Many researchers have recognized these kinds of supply network structure as a new organization form, using terms such as "Keiretsu", "Extended Enterprise", "Virtual Corporation", Global Production Network", and "Next Generation Manufacturing System". [3] In general, such a structure can be defined as "a group of semi-independent organizations, each with their capabilities, which collaborate in ever-changing constellations to serve one or more markets in order to achieve some business goal specific to that collaboration" (Akkermans, 2001).

Supply chain business process integration:


Successful SCM requires a change from managing individual functions to integrating activities into key supply chain processes. An example scenario: the purchasing department places orders as requirements become appropriate. Marketing, responding to customer demand, communicates with several distributors and retailers, and attempts to satisfy this demand. Shared information between supply chain partners can only be fully leveraged through process integration. Supply chain business process integration involves collaborative work between buyers and suppliers, joint product development, common systems and shared information. According to Lambert and Cooper (2000) operating an integrated supply chain requires continuous information flows, which in turn assist to achieve the best product flows. However, in many companies, management has reached the conclusion that optimizing the product flows cannot be accomplished without implementing a process approach to the business. The key supply chain processes stated by Lambert (2004) are:

Customer relationship management Customer service management Demand management

Order fulfillment Manufacturing flow management Supplier relationship management Product development and commercialization Returns management

One could suggest other key critical supply business processes combining these processes stated by Lambert such as: a. Customer service management b. Procurement c. Product development and commercialization d. Manufacturing flow management/support e. Physical distribution f. Outsourcing/partnerships g. Performance measurement a) Customer service management process Customer Relationship Management concerns the relationship between the organization and its customers.Customer service provides the source of customer information. It also provides the customer with real-time information on promising dates and product availability through interfaces with the company's production and distribution operations. Successful organizations use following steps to build customer relationships:

determine mutually satisfying goals between organization and customers establish and maintain customer rapport produce positive feelings in the organization and the customers

b) Procurement process Strategic plans are developed with suppliers to support the manufacturing flow management process and development of new products. In firms where operations extend globally, sourcing should be managed on a global basis. The desired outcome is a win-win relationship, where both parties benefit, and reduction times in the design cycle and product development is achieved. Also, the purchasing function develops rapid communication systems, such as electronic data interchange (EDI) and Internet linkages to transfer possible requirements more rapidly. Activities related to obtaining products and materials from outside suppliers. This requires performing resource planning, supply sourcing, negotiation, order placement, inbound transportation, storage and handling and quality assurance. Also, includes the responsibility to coordinate with suppliers in scheduling, supply continuity, hedging, and research to new sources or programmes. c) Product development and commercialization Here, customers and suppliers must be united into the product development process, thus to reduce time to market. As product life cycles shorten, the appropriate products must be developed and successfully launched in ever shorter time-schedules to remain competitive. According to Lambert and Cooper (2000), managers of the product development and

commercialization process must: 1. coordinate with customer relationship management to identify customer-articulated needs; 2. select materials and suppliers in conjunction with procurement, and 3. develop production technology in manufacturing flow to manufacture and integrate into the best supply chain flow for the product/market combination. d) Manufacturing flow management process The manufacturing process is produced and supplies products to the distribution channels based on past forecasts. Manufacturing processes must be flexible to respond to market changes, and must accommodate mass customization. Orders are processes operating on a just-in-time (JIT) basis in minimum lot sizes. Also, changes in the manufacturing flow process lead to shorter cycle times, meaning improved responsiveness and efficiency of demand to customers. Activities related to planning, scheduling and supporting manufacturing operations, such as work-inprocess storage, handling, transportation, and time phasing of components, inventory at manufacturing sites and maximum flexibility in the coordination of geographic and final assemblies postponement of physical distribution operations. e) Physical distribution This concerns movement of a finished product/service to customers. In physical distribution, the customer is the final destination of a marketing channel, and the availability of the product/service is a vital part of each channel participant's marketing effort. It is also through the physical distribution process that the time and space of customer service become an integral part of marketing, thus it links a marketing channel with its customers (e.g. links manufacturers, wholesalers, retailers). f) Outsourcing/partnerships This is not just outsourcing the procurement of materials and components, but also outsourcing of services that traditionally have been provided in-house. The logic of this trend is that the company will increasingly focus on those activities in the value chain where it has a distinctive advantage and everything else it will outsource. This movement has been particularly evident in logistics where the provision of transport, warehousing and inventory control is increasingly subcontracted to specialists or logistics partners. Also, to manage and control this network of partners and suppliers requires a blend of both central and local involvement. Hence, strategic decisions need to be taken centrally with the monitoring and control of supplier performance and day-to-day liaison with logistics partners being best managed at a local level. g) Performance measurement Experts found a strong relationship from the largest arcs of supplier and customer integration to market share and profitability. By taking advantage of supplier capabilities and emphasizing a long-term supply chain perspective in customer relationships can be both correlated with firm performance. As logistics competency becomes a more critical factor in creating and maintaining competitive advantage, logistics measurement becomes increasingly important because the difference between profitable and unprofitable operations becomes more narrow. A.T. Kearney Consultants (1985) noted that firms engaging in comprehensive performance measurement realized improvements in overall productivity. According to experts internal measures are

generally collected and analyzed by the firm including 1. 2. 3. 4. 5. Cost Customer Service Productivity measures Asset measurement, and Quality.

External performance measurement is examined through customer perception measures and "best practice" benchmarking, and includes 1) customer perception measurement, and 2) best practice benchmarking. Components of supply chain management are 1. Standardisation 2. Postponement 3. Customisation

Supply chain management components integration


The management components of SCM The SCM management components are the third element of the four-square circulation framework. The level of integration and management of a business process link is a function of the number and level, ranging from low to high, of components added to the link (Ellram and Cooper, 1990; Houlihan, 1985). Consequently, adding more management components or increasing the level of each component can increase the level of integration of the business process link. The literature on business process reengineering,[4] buyer-supplier relationships,[5] and SCM[6] suggests various possible components that must receive managerial attention when managing supply relationships. Lambert and Cooper (2000) identified the following components which are:

Planning and control Work structure Organization structure Product flow facility structure Information flow facility structure Management methods Power and leadership structure Risk and reward structure Culture and attitude

However, a more careful examination of the existing literature[7] will lead us to a more comprehensive structure of what should be the key critical supply chain components, the "branches" of the previous identified supply chain business processes, that is what kind of relationship the components may have that are related with suppliers and customers accordingly. Bowersox and Closs states that the emphasis on cooperation represents the synergism leading to the highest level of joint achievement (Bowersox and Closs, 1996). A primary level channel participant is a business that is willing to participate in the inventory ownership responsibility or assume other aspects financial risk, thus including primary level components (Bowersox and Closs, 1996). A secondary level participant (specialized), is a business that participates in channel relationships by performing essential services for primary participants, thus including

secondary level components, which are supporting the primary ones. Also, third level channel participants and components may be included, that will support the primary level channel participants, and which are the fundamental branches of the secondary level components. Consequently, Lambert and Cooper's framework of supply chain components, does not lead us to the conclusion about what are the primary or secondary (specialized) level supply chain components ( see Bowersox and Closs, 1996, p.g. 93), that is what supply chain components should be viewed as primary or secondary, and how should these components be structured in order to have a more comprehensive supply chain structure and to examine the supply chain as an integrative one (See above sections 2.1 and 3.1). Baziotopoulos reviewed the literature to identify supply chain components. [8][9][10][11][12][13][14][15] Based on this study, Baziotopoulos (2004) suggests the following supply chain components (Fig.8): 1. For customer service management: Includes the primary level component of customer relationship management, and secondary level components such as benchmarking and order fulfillment. 2. For product development and commercialization: Includes the primary level component of Product Data Management (PDM), and secondary level components such as market share, customer satisfaction, profit margins, and returns to stakeholders. 3. For physical distribution, Manufacturing support and Procurement: Includes the primary level component of enterprise resource planning (ERP), with secondary level components such as warehouse management, material management, manufacturing planning, personnel management, and postponement (order management). 4. For performance measurement: This includes the primary level component of logistics performance measurement, which is correlated with the information flow facility structure within the organization. Secondary level components may include four types of measurement such as: variation, direction, decision and policy measurements. More specifically, in accordance with these secondary level components total cost analysis (TCA), customer profitability analysis (CPA), and Asset management could be concerned as well. In general, information flow facility structure is regarded by two important requirements, which are a) planning and Coordination flows, and b)operational requirements. 5. For outsourcing: This includes the primary level component of management methods and the company's cutting-edge strategy and its vital strategic objectives that the company will identify and adopt for particular strategic initiatives in key the areas of technology information, operations, manufacturing capabilities, and logistics (secondary level components).

References

Kaushik K.D., & Cooper, M. (2000). Industrial Marketing Management. Volume29, Issue 1 , January 2000, Pages 65-83 Rolf G. Poluha, Application of the SCOR Model in Supply Chain Management. Youngstown, NY 2006, ISBN 1-934043-10-9. Haag, S., Cummings, M., McCubbrey, D., Pinsonneault, A., & Donovan, R. (2006), Management Information Systems For the Information Age (3rd Canadian Ed.), Canada: McGraw Hill Ryerson ISBN 0-072-81947-2

Handfield and Bechtel, 2001; Prater et al., 2001; Kern and Willcocks, 2000; Bowersox and Closs, 1996; Christopher, 1992; Bowersox, 1989 1. ^ Baziotopoulos, 2004 2. ^ MacDuffie and Helper, 1997; Monden, 1993; Womack and Jones, 1996; Gunasekaran, 1999 3. ^ Drucker, 1998; Tapscott, 1996; Dilts, 1999 4. ^ Macneil ,1975; Williamson, 1974; Hewitt, 1994 5. ^ Stevens, 1989; Ellram and Cooper, 1993; Ellram and Cooper, 1990; Houlihan, 1985 6. ^ Cooper et al., 1997; Lambert et al.,1996; Turnbull, 1990 7. ^ Zhang and Dilts, 2004 ;Vickery et al., 2003; Hemila, 2002; Christopher, 1998; Joyce et al., 1997; Bowersox and Closs, 1996; Williamson, 1991; Courtright et al., 1989; Hofstede, 1978 8. ^ Stevens, 1989 9. ^ Ellram and Cooper, 1993 10. ^ Mills et al., 2004 11. ^ Lewis and Talalayevsky, 2004 12. ^ Hedberg and Olhager, 2002 13. ^ Hemila, 2002 14. ^ Vickery et.al., 2003 15. ^ Yusuf et al., 2003

See also

Beer Distribution Game Bullwhip effect Calculating Demand Forecast Accuracy Customer Driven Supply Chain Demand chain management Distribution e-business Information technology management Inventory management Fulfilment Logistic engineering Logistics Liquid Logistics Management information systems Marketing Military Supply Chain Management Procurement Procurement outsourcing Reverse logistics Strategic information system Supply Chain Management: an International Journal Supply Chain Security Supply chain Supplier relationship management Value chain

Value grid Vendor Managed Inventory Warehouse Management System Industrial Engineering Retrieved from "http://en.wikipedia.org/wiki/Supply_chain_management"

CRM
Customer relationship management (CRM) consists of the processes a company uses to track and organize its contacts with its current and prospective customers. CRM software is used to support these processes; information about customers and customer interactions can be entered, stored and accessed by employees in different company departments. Typical CRM goals are to improve services provided to customers, and to use customer contact information for targeted marketing. ( Source: www.wikipedia.com, 27/03/2009, search string: CRM)

While the term CRM generally refers to a software-based approach to handling customer relationships, most CRM software vendors stress that a successful CRM effort requires a holistic approach.[1] CRM initiatives often fail because implementation was limited to software installation, without providing the context, support and understanding for employees to learn, and take full advantage of the information systems.[2] CRM can be implemented without major investments in software, but software is often neccessary to explore the full benefits of a CRM strategy. Other problems occur[3] when failing to think of sales as the output of a process that itself needs to be studied and taken into account when planning automation[4]. OVERVIEW: From the outside, customers interacting with a company perceive the business as a single entity, despite often interacting with a number of employees in different roles and departments. CRM is a combination of policies, processes, and strategies implemented by an organization to unify its customer interactions and provide a means to track customer information. It involves the use of technology in attracting new and profitable customers, while forming tighter bonds with existing ones. ( Source: www.wikipedia.com, 27/03/2009, search string: CRM)

CRM includes many aspects which relate directly to one another:


Front office operations Direct interaction with customers, e.g. face to face meetings, phone calls, e-mail, online services etc. Back office operations Operations that ultimately affect the activities of the front office (e.g., billing, maintenance, planning, marketing, advertising, finance, manufacturing, etc.) Business relationships Interaction with other companies and partners, such as suppliers/vendors and retail outlets/distributors, industry networks (lobbying groups, trade associations). This external network supports front and back office activities. Analysis Key CRM data can be analyzed in order to plan target-marketing campaigns, conceive business strategies, and judge the success of CRM activities (e.g., market share,

number and types of customers, revenue, profitability). TYPES OF CRM: There are several different approaches to CRM, with different software packages focusing on different aspects. In general, Customer Service, Campaign Management and Sales Force Automation form the core of the system (with SFA being the most popular[citation needed]).

Operational CRM
Operational CRM provides support to "front office" business processes, e.g. to sales, marketing and service staff. Interactions with customers are generally stored in customers' contact histories, and staff can retrieve customer information as necessary. The contact history provides staff members with immediate access to important information on the customer (products owned, prior support calls etc.), eliminating the need to individually obtain this information directly from the customer. Reaching to the customer at right time at right place is preferable. ( Source: www.wikipedia.com, 27/03/2009, search string: CRM)

Operational CRM processes customer data for a variety of purposes:


Managing campaigns Enterprise Marketing Automation Sales Force Automation Sales Management System

Sales (SFA)
Sales Force Automation automates sales force-related activities such as:

Activity Management: Scheduling sales calls or mailings Tracking responses Generating reports Opportunity Management and Assessment Account Management and Target Account Selling Automate Sales Order Processing

Analytical CRM
Analytical CRM analyzes customer data for a variety of purposes:

Designing and executing targeted marketing campaigns Designing and executing campaigns, e.g. customer acquisition, cross-selling, up-selling Analysing customer behavior in order to make decisions relating to products and services (e.g. pricing, product development) Management information system (e.g. financial forecasting and customer profitability analysis)

Analytical CRM generally makes heavy use of data mining..

Sales Intelligence CRM


Sales Intelligence CRM is similar to Analytical CRM, but is intended as a more direct sales tool. Features include alerts sent to sales staff regarding:

Cross-selling/Up-selling/Switch-selling opportunities Customer drift Sales performance Customer trends Customer margins Customer alignment

Campaign Management
Campaign management combines elements of Operational and Analytical CRM. Campaign management functions include:

Target groups formed from the client base according to selected criteria Sending campaign-related material (e.g. on special offers) to selected recipients using various channels (e.g. e-mail, telephone, SMS, post) Tracking, storing, and analyzing campaign statistics, including tracking responses and analyzing trends

Collaborative CRM
Collaborative CRM covers aspects of a company's dealings with customers that are handled by various departments within a company, such as sales, technical support and marketing. Staff members from different departments can share information collected when interacting with customers. For example, feedback received by customer support agents can provide other staff members with information on the services and features requested by customers. Collaborative CRM's ultimate goal is to use information collected by all departments to improve the quality of services provided by the company.[5]

Consumer Relationship CRM


Consumer Relationship System (CRS) covers aspects of a company's dealing with customers handled by the Consumer Affairs and Customer Relations contact centers within a company.[1] Representatives handle in-bound contact from anonymous consumers and customers. Early warnings can be issued regarding product issues (e.g. item recalls) and current consumer sent iment can be tracked (voice of the customer). STRATEGY: Several CRM software packages are available, and they vary in their approach to CRM. However, as mentioned above, CRM is not just a technology but rather a comprehensive, customer-centric approach to an organization's philosophy of dealing with its customers. This

includes policies and processes, front-of-house customer service, employee training, marketing, systems and information management. Hence, it is important that any CRM implementation considerations stretch beyond technology toward the broader organizational requirements. ( Source: www.wikipedia.com, 27/03/2009, search string: CRM)

The objectives of a CRM strategy must consider a companys specific situation and its customers' needs and expectations. Information gained through CRM initiatives can support the development of marketing strategy by developing the organization's knowledge in areas such as identifying customer segments, improving customer retention, improving product offerings (by better understanding customer needs), and by identifying the organization's most profitable customers.[6] CRM strategies can vary in size, complexity, and scope. Some companies consider a CRM strategy only to focus on the management of a team of salespeople. However, other CRM strategies can cover customer interaction across the entire organization. Many commercial CRM software packages provide features that serve the sales, marketing, event management, project management, and finance industries. From this perspective, CRM has for some time been seen to play an important role in many sales process engineering efforts[7]. ( Source: www.wikipedia.com, 27/03/2009, search string: CRM)

IMPLEMENTATION ISSUES: Many CRM project "failures" are also related to data quality and availability. Data cleaning is a major issue. If a company's CRM strategy is to track life-cycle revenues, costs, margins, and interactions between individual customers, this must be reflected in all business processes. Data must be extracted from multiple sources (e.g., departmental/divisional databases such as sales, manufacturing, supply chain, logistics, finance, service etc.), which requires an integrated, comprehensive system in place with well-defined structures and high data quality. Data from other systems can be transferred to CRM systems using appropriate interfaces. ( Source: www.wikipedia.com, 27/03/2009, search string: CRM)

Because of the company-wide size and scope of many CRM implementations, significant preplanning is essential for smooth roll-out. This pre-planning involves a technical evaluation of the data available and the technology employed in existing systems. This evaluation is critical to determine the level of effort needed to integrate this data. Equally critical is the human aspect of the implementation. A successful implementation requires an understanding of the expectations and needs of the stakeholders involved. An executive sponsor should also be obtained to provide high-level management representation of the CRM project. ( Source: www.wikipedia.com)

An effective tool for identifying technical and human factors before beginning a CRM project is a pre-implementation checklist.[8] A checklist can help ensure any potential problems are identified early in the process. PRIVACY AND DATASECUROTY: One of the primary functions of CRM software is to collect information about customers. When gathering data as part of a CRM solution, a company must consider the desire for customer privacy and data security, as well as the legislative and cultural norms. Some customers prefer assurances that their data will not be shared with third parties without their prior consent and that safeguards are in place to prevent illegal access by third parties. ( Source: www.wikipedia.com)

MARKET STRUCTURE The following table lists the top CRM software vendors in 2006-2007 (figures in millions of US dollars) published in a Gartner study.[9]

Vendor

2007 Revenue 2007 Share (%) 2006 Revenue 2006 Share (%) '06-'07 Growth (%)

SAP

2,050.8 25.3

1,681.7

26.6

22.0

Oracle

1,319.8 15.3

1,016.8

15.5

29.8

Salesforce.com

676.5 8.3

451.7

6.9

49.8

Amdocs

421.0 5.2

365.9

5.6

15.1

Microsoft

332.1 4.1

176.1

2.7

88.6

Others

3,289.1 40.6

2,881.6

43.7

14.1

Total

8,089.3 100

6,573.8

100

23.1

The following table lists the top software vendors for CRM projects completed in 2006 using external consultants and system integrators, according to a 2007 Gartner study.[10]

Vendor

Percentage of implementations

Siebel (Oracle)

41%

SAP

8%

Epiphany (Infor)

3%

Oracle

3%

PeopleSoft (Oracle)

2%

salesforce.com

2%

Amdocs

1%

Chordiant

1%

Microsoft

1%

SAS

1%

Others

15%

None

22%

A 2007 Datamonitor report [11] lists Oracle (including Siebel) and SAP as the top CRM vendors, with Chordiant, Infor, and SalesForce.com as significant, smaller vendors. ( Source: www.wikipedia.com) REFERENCES: 1. ^ Malthouse, Edward C; Bobby J Calder (2005). "Relationship Branding and CRM". in Alice Tybout
and Tim Calkins. Kellogg on Branding. Wasdfasdfn ansdjfasdf asdfjk asdfksdaf asdf asd f asd ffsdjkfsdkajfkjasdf iley. pp. 150-168. 2. ^ Rigby, Darrell K.; Frederick F. Reichheld, Phil Schefter (2002). "Avoid the four perils of CRM".

Harvard Business Review 80 (2): 101109. doi:10.1225/8946. 3. ^ Paul H. Selden (April/May 1996). Sales and Marketing Strategies & News 6 (3): 51 and 53. 4. ^ Paul H. Selden (November 2000). "The Power of Quality Thinking In Sales and Management". Quality Progress: 58-64. 5. ^ Edwards, John (2007-11-29). "Get It Together with Collaborative CRM". insideCRM. Tippit. http://www.insidecrm.com/features/collaborative-crm-112907/. Retrieved on 2008-02-01. 6. ^ Bligh, Philip; Douglas Turk (2004). CRM unplugged releasing CRM's strategic value. Hoboken: John Wiley & Sons. ISBN 0-471-48304-4. 7. ^ Paul H. Selden (1997). Sales Process Engineering: A Personal Workshop. Milwaukee, WI: ASQ Quality Press. p. 23. 8. ^ Dyche, 2002, Managing Your CRM Project 9. ^ Gartner, Inc (2008-09-12). Gartner Says Worldwide Customer Relationship Management Market Grew 23 Percent in 2007. Press release. http://www.gartner.com/it/page.jsp?id=715308. Retrieved on 2008-08-15. 10. ^ Gartner, Inc. (22 June 2007) Commonly Deployed CRM Application Vendors in 2006 11. ^ Datamonitor (22 August 2007). Datamonitor suggests Oracle, SAP likely to remain atop CRM market

Retrieved from "http://en.wikipedia.org/wiki/Customer_relationship_management"

DATA WAREHOUSING
Data warehouse is a repository of an organization's electronically stored data. Data warehouses are designed to facilitate reporting and analysis[1]. This definition of the data warehouse focuses on data storage. However, the means to retrieve and analyze data, to extract, transform and load data, and to manage the data dictionary are also considered essential components of a data warehousing system. Many references to data warehousing use this broader context. Thus, an expanded definition for data warehousing includes business intelligence tools, tools to extract, transform, and load data into the repository, and tools to manage and retrieve metadata. In contrast to data warehouses are operational databases that support day-to-day transaction processing. HISTORY OF DATAWAREHOUSING: The concept of data warehousing dates back to the late 1980s [2] when IBM researchers Barry Devlin and Paul Murphy developed the "business data warehouse". In essence, the data warehousing concept was intended to provide an architectural model for the flow of data from operational systems to decision support environments. The concept attempted to address the various problems associated with this flow - mainly, the high costs associated with it. In the absence of a data warehousing architecture, an enormous amount of redundancy was required to support multiple decision support environments. In larger corporations it was typical for multiple decision support environments to operate independently. Each environment served different users but often required much of the same data. The process of gathering, cleaning and integrating data from various sources, usually long existing operational systems (usually referred to as legacy systems), was typically in part replicated for each environment. Moreover, the operational systems were frequently reexamined as new decision support requirements emerged. Often new requirements necessitated gathering, cleaning and integrating new data from the operational systems that were logically related to prior gathered data.

Based on analogies with real-life warehouses, data warehouses were intended as large-scale collection/storage/staging areas for corporate data. Data could be retrieved from one central point or data could be distributed to "retail stores" or "data marts" that were tailored for ready access by users. Key developments in early years of data warehousing were:

1960s - General Mills and Dartmouth College, in a joint research project, develop the terms dimensions and facts.[3] 1970s - ACNielsen and IRI provide dimensional data marts for retail sales.[3] 1983 - Teradata introduces a database management system specifically designed for decision support. 1988 - Barry Devlin and Paul Murphy publish the article An architecture for a business and information systems in IBM Systems Journal where they introduce the term "business data warehouse". 1990 - Red Brick Systems introduces Red Brick Warehouse, a database management system specifically for data warehousing. 1991 - Prism Solutions introduces Prism Warehouse Manager, software for developing a data warehouse. 1991 - Bill Inmon publishes the book Building the Data Warehouse. 1995 - The Data Warehousing Institute, a for-profit organization that promotes data warehousing, is founded. 1996 - Ralph Kimball publishes the book The Data Warehouse Toolkit. 1997 - Oracle 8, with support for star queries, is released.

Data mining
Data mining is the process of extracting hidden patterns from large amounts of data. As more data is gathered, with the amount of data doubling every three years, [1] data mining is becoming an increasingly important tool to transform this data into information. It is commonly used in a wide range of profiling practices, such as marketing, surveillance, fraud detection and scientific discovery. (SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) Data mining can be applied to data sets of any size. However, while it can be used to uncover hidden patterns in data that have been collected, it can neither uncover patterns that are not already present in the data, nor can it uncover patterns in data that have not been collected. Further, the discovery of a particular pattern in a particular set of data does not necessarily mean that pattern is representative of the whole population from which that data was drawn. Hence the need for verification and validation of patterns on other samples of data. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining)

Slide-203
The term data mining has also been used in a related but negative sense, to mean the deliberate searching for apparent but not necessarily representative patterns in large amounts of data. To avoid confusion with the other sense, the terms data dredging and data snooping are often used. Note, however, that dredging and snooping can be (and sometimes are) used as exploratory tools when developing and clarifying hypotheses. Humans have been "manually" extracting information from data for centuries, but the increasing volume of data in modern times has called for more automatic approaches. As data sets and the

information extracted from them has grown in size and complexity, direct hands-on data analysis has increasingly been supplemented and augmented with indirect, automatic data processing using more complex and sophisticated tools, methods and models. The proliferation, ubiquity and increasing power of computer technology has aided data collection, processing, management and storage. However, the captured data needs to be converted into information and knowledge to become useful. Data mining is the process of using computing power to apply methodologies, including new techniques for knowledge discovery, to data.[2] Data mining identifies trends within data that go beyond simple data analysis. Through the use of sophisticated algorithms, non-statistician users have the opportunity to identify key attributes of processes and target opportunities. However, abdicating control and understanding of processes from statisticians to poorly informed or uninformed users can result in false-positives, no useful results, and worst of all, results that are misleading and/or misinterpreted. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) Although data mining is a relatively new term, the technology is not. For many years, businesses and governments have used increasingly powerful computers to sift through volumes of data such as airline passenger trip records, census data and supermarket scanner data to produce market research reports. (Note, however, that reporting is not always considered to be data mining). Continuous innovations in computer processing power, disk storage, data capture technology, algorithms, methodologies and analysis software have dramatically increased the accuracy and usefulness of the extracted information. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) The term data mining is often used to apply to the two separate processes of knowledge discovery and prediction. Knowledge discovery provides explicit information about the characteristics of the collected data, using a number of techniques (e.g., association rule mining). Forecasting and predictive modeling provide predictions of future events, and the processes may range from the transparent (e.g., rule-based approaches) through to the opaque (e.g., neural networks). Metadata, (data about the characteristics of a data set), are often expressed in a condensed data-minable format, or one that facilitates the practice of data mining. Common examples include executive summaries and scientific abstracts. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) Data mining is usually performed on "real-world data". Such data are vulnerable to collinearity because of unknown and possibly unobserved interrelations. An unavoidable fact of data mining is that the (sub-)set of data being analysed may not be representative of the whole domain, and therefore may not contain examples of certain critical relationships that exist across other parts of the domain. Alternative methods using experiment-based approaches, such as Choice Modelling for human-generated data, may be used to address this sort of issue. In these situations, inherent correlations can be either controlled for or removed altogether during the construction of the experimental design. There have been some efforts to define standards for data mining, for example the 1999 European Cross Industry Standard Process for Data Mining (CRISP-DM 1.0) and the 2004 Java Data Mining standard (JDM 1.0). These are evolving standards; later versions of these standards are under development. Independent of these standardization efforts, freely available opensource software systems like RapidMiner and Weka have become an informal standard for defining data-mining processes.[citation needed]

Since the availability of affordable computer processing power in the last quarter of the 20th century, organizations have been accumulating vast and ever growing amounts of data, including, for example:

operational and transactional data, such as sales, cost, inventory, payroll and accounting data nonoperational data, such as forecasts and macro economic data meta data data about the data itself, such as logical database design and data dictionary definitions

This article outlines the longitudinal changes of DMKD research activities during the last decade by surveying a large collection of Data Mining literature to provide a comprehensive picture of current DMKD research and classify these research activities into high-level categories.[3] PROCESS OF DATAMINING Knowledge Discovery in Databases (KDD), is the name coined by Gregory Piatetsky-Shapiro in 1989 to describe the process of finding interesting, interpreted, useful and novel data. There are many nuances to this process, but roughly the steps are to preprocess raw data, mine the data, and interpret the results.[4]

Pre-processing
Once the objective for the KDD process is known, a target data set must be assembled. As data mining can only uncover patterns already present in the data, the target dataset must be large enough to contain these patterns while remaining concise enough to be mined in an acceptable timeframe. A common source for data is a datamart or data warehouse. The target set is then cleaned. Cleaning removes the observations with noise and missing data. The clean data is reduced into feature vectors, one vector per observation. A feature vector is a summarized version of the raw data observation. For example, a black and white image of a face which is 100px by 100px would contain 10,000 bits of raw data. This might be turned into a feature vector by locating the eyes and mouth in the image. Doing so would reduce the data for each vector from 10,000 bits to three codes for the locations, dramatically reducing the size of the dataset to be mined, and hence reducing the processing effort. The feature(s) selected will depend on what the objective(s) is/are; obviously, selecting the "right" feature(s) is fundamental to successful data mining. The feature vectors are divided into two sets, the "training set" and the "test set". The training set is used to "train" the data mining algorithm(s), while the test set is used to verify the accuracy of any patterns found. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) INTERPRETING THE RESULT The final step of knowledge discovery from data is to evaluate the patterns produced by the data mining algorithms. Not all patterns found by the data mining algorithms are necessarily valid. It is common for the data mining algorithms to find patterns in the training set which are not present in the general data set, this is called overfitting. To overcome this, the evaluation uses a "test set" of data which the data mining algorithm was not trained on. The learnt patterns are applied to this "test set" and the resulting output is compared to the desired output. For example, a data mining

algorithm trying to distinguish spam from legitimate emails would be trained on a "training set" of sample emails. Once trained, the learnt patterns would be applied to the "test set" of emails which it had not been trained on, the accuracy of these patterns can then be measured from how many emails they correctly classify. A number of statistical methods may be used to evaluate the algorithm such as ROC curves. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) If the learnt patterns do not meet the desired standards, then it is necessary to reevaluate and change the preprocessing and datamining. If the learnt patterns do meet the desired standards then the final step is to interpret the learnt patterns and turn them into knowledge. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining)

Slide-204
USE OF DATAMINING:

Surveillance
Previous data mining to stop terrorist programs under the U.S. government include the Total Information Awareness (TIA) program, Computer-Assisted Passenger Prescreening System (CAPPS II), Analysis, Dissemination, Visualization, Insight, Semantic Enhancement (ADVISE[5]), Multistate Anti-Terrorism Information Exchange (MATRIX), and the Secure Flight program.[6] These programs have been discontinued due to controversy over whether they violate the US Constitution's 4th amendment, although many programs that were formed under them continue to be funded by different organizations, or under different names.[7] Two plausible data mining techniques in the context of combating terrorism include "pattern mining" and "subject-based data mining".

Pattern mining
"Pattern mining" is a data mining technique that involves finding existing patterns in data. In this context patterns often means association rules. The original motivation for searching association rules came from the desire to analyze supermarket transaction data, that is, to examine customer behaviour in terms of the purchased products. For example, an association rule "beer => crisps (80%)" states that four out of five customers that bought beer also bought crisps. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) In the context of pattern mining as a tool to identify terrorist activity, the National Research Council provides the following definition: "Pattern-based data mining looks for patterns (including anomalous data patterns) that might be associated with terrorist activity these patterns might be regarded as small signals in a large ocean of noise."[8][9][10] Pattern Mining includes new areas such a Music Information Retrieval (MIR) where patterns seen both in the temporal and non temporal domains are imported to classical knowledge discovery search techniques. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining)

Subject-based data mining


"Subject-based data mining" is a data mining technique involving the search for associations

between individuals in data. In the context of combatting terrorism, the National Research Council provides the following definition: "Subject-based data mining uses an initiating individual or other datum that is considered, based on other information, to be of high interest, and the goal is to determine what other persons or financial transactions or movements, etc., are related to that initiating datum."[9]

Games
Since the early 1960s, with the availability of oracles for certain combinatorial games, also called tablebases (e.g. for 3x3-chess) with any beginning configuration, small-board dots-and-boxes, small-board-hex, and certain endgames in chess, dots-and-boxes, and hex; a new area for data mining has been opened up. This is the extraction of human-usable strategies from these oracles. Current pattern recognition approaches do not seem to fully have the required high level of abstraction in order to be applied successfully. Instead, extensive experimentation with the tablebases, combined with an intensive study of tablebase-answers to well designed problems and with knowledge of prior art, i.e. pre-tablebase knowledge, is used to yield insightful patterns. Berlekamp in dots-and-boxes etc. and John Nunn in chess endgames are notable examples of researchers doing this work, though they were not and are not involved in tablebase generation. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining)

Business
Data mining in customer relationship management applications can contribute significantly to the bottom line.[citation needed] Rather than randomly contacting a prospect or customer through a call center or sending mail, a company can concentrate its efforts on prospects that are predicted to have a high likelihood of responding to an offer. More sophisticated methods may be used to optimize resources across campaigns so that one may predict which channel and which offer an individual is most likely to respond to across all potential offers. Finally, in cases where many people will take an action without an offer, uplift modeling can be used to determine which people will have the greatest increase in responding if given an offer. Data clustering can also be used to automatically discover the segments or groups within a customer data set. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) Businesses employing data mining may see a return on investment, but also they recognize that the number of predictive models can quickly become very large. Rather than one model to predict which customers will churn, a business could build a separate model for each region and customer type. Then instead of sending an offer to all people that are likely to churn, it may only want to send offers to customers that will likely take to offer. And finally, it may also want to determine which customers are going to be profitable over a window of time and only send the offers to those that are likely to be profitable. In order to maintain this quantity of models, they need to manage model versions and move to automated data mining. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) Data mining can also be helpful to human-resources departments in identifying the characteristics of their most successful employees. Information obtained, such as universities attended by highly successful employees, can help HR focus recruiting efforts accordingly. Additionally, Strategic Enterprise Management applications help a company translate corporate-level goals, such as profit and margin share targets, into operational decisions, such as production plans and workforce levels.[11] Another example of data mining, often called the market basket analysis, relates to its use in retail sales. If a clothing store records the purchases of customers, a data-mining system could

identify those customers who favour silk shirts over cotton ones. Although some explanations of relationships may be difficult, taking advantage of it is easier. The example deals with association rules within transaction-based data. Not all data are transaction based and logical or inexact rules may also be present within a database. In a manufacturing application, an inexact rule may state that 73% of products which have a specific defect or problem will develop a secondary problem within the next six months. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) Market basket analysis has also been used to identify the purchase patterns of the Alpha consumer. Alpha Consumers are people that play a key roles in connecting with the concept behind a product, then adopting that product, and finally validating it for the rest of society. Analyzing the data collected on these type of users has allowed companies to predict future buying trends and forecast supply demands. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) Data Mining is a highly effective tool in the catalog marketing industry. Catalogers have a rich history of customer transactions on millions of customers dating back several years. Data mining tools can identify patterns among customers and help identify the most likely customers to respond to upcoming mailing campaigns. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining)

Related to an integrated-circuit production line, an example of data mining is described in the paper "Mining IC Test Data to Optimize VLSI Testing."[12] In this paper the application of data mining and decision analysis to the problem of die-level functional test is described. Experiments mentioned in this paper demonstrate the ability of applying a system of mining historical die-test data to create a probabilistic model of patterns of die failure which are then utilized to decide in real time which die to test next and when to stop testing. This system has been shown, based on experiments with historical test data, to have the potential to improve profits on mature IC products. (SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) Given below is a list of the top eight data-mining software vendors in 2008 published in a Gartner study.[13]

Angoss Software Infor CRM Epiphany Kxen Portrait Software SAS SPSS ThinkAnalytics Unica Viscovery Monarch

Science and engineering


In recent years, data mining has been widely used in area of science and engineering, such as bioinformatics, genetics, medicine, education and electrical power engineering. In the area of study on human genetics, the important goal is to understand the mapping

relationship between the inter-individual variation in human DNA sequences and variability in disease susceptibility. In lay terms, it is to find out how the changes in an individual's DNA sequence affect the risk of developing common diseases such as cancer. This is very important to help improve the diagnosis, prevention and treatment of the diseases. The data mining technique that is used to perform this task is known as multifactor dimensionality reduction.[14] In the area of electrical power engineering, data mining techniques have been widely used for condition monitoring of high voltage electrical equipment. The purpose of condition monitoring is to obtain valuable information on the insulation's health status of the equipment. Data clustering such as self-organizing map (SOM) has been applied on the vibration monitoring and analysis of transformer on-load tap-changers(OLTCS). Using vibration monitoring, it can be observed that each tap change operation generates a signal that contains information about the condition of the tap changer contacts and the drive mechanisms. Obviously, different tap positions will generate different signals. However, there was considerable variability amongst normal condition signals for the exact same tap position. SOM has been applied to detect abnormal conditions and to estimate the nature of the abnormalities.[15] Data mining techniques have also been applied for dissolved gas analysis (DGA) on power transformers. DGA, as a diagnostics for power transformer, has been available for many years. Data mining techniques such as SOM has been applied to analyse data and to determine trends which are not obvious to the standard DGA ratio techniques such as Duval Triangle.[15] A fourth area of application for data mining in science/engineering is within educational research, where data mining has been used to study the factors leading students to choose to engage in behaviors which reduce their learning[16] and to understand the factors influencing university student retention.[17]. A similar example of the social application of data mining its is use in expertise finding systems, whereby descriptors of human expertise are extracted, normalized and classified so as to facilitate the finding of experts, particularly in scientific and technical fields. In this way, data mining can facilitate Institutional memory. Other examples of applying data mining technique applications are biomedical data facilitated by domain ontologies,[18] mining clinical trial data,[19] traffic analysis using SOM,[20] et cetera. ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining) In adverse drug reaction surveillance, the Uppsala Monitoring Centre has, since 1998, used data mining methods to routinely screen for reporting patterns indicative of emerging drug safety issues in the WHO global database of 4.6 million suspected adverse drug reaction incidents[21]. Recently, similar methodology has been developed to mine large collections of electronic health records for temporal patterns associating drug prescriptions to medical diagnoses[22].

Privacy concerns and ethics


Some people believe that data mining itself is ethically neutral.[23] However, the way that data mining is used can raise ethical questions regarding privacy, legality, and ethics.[24] In particular, data mining government or commercial data sets for national security or law enforcement purposes, such as in the Total Information Awareness Program or in ADVISE, has raised privacy concerns.[25][26] Datamining can uncover information or patterns which may compromise confidentiality and

privacy obligations. A common way for this to occur is through data aggregation. Data aggregation is when the data which has been mined, possibly from various sources, has been put together so that it can be analyzed.[27] The threat to an individual's privacy comes into play when the data, once compiled, causes the data miner to be able to identify specific individuals, especially when originally the data was anonymous. It is recommended that an individual is made aware of the following before data is collected: ( SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining)

the purpose of the data collection and any data mining projects, how the data will be used, who will be able to mine the data and use it, the security surrounding access to the data, and in addition, how collected data can be updated.[27]

One may additionally modify the data so that it is anonymous, so that individuals may not be readily identified.[27] Data mining is about analysing data; for information about extracting information out of data, see:

Information extraction Named entity recognition Profiling Profiling practices

References
1. ^ Lyman, Peter; Hal R. Varian (2003). "How Much Information". http://www.sims.berkeley.edu/howmuch-info-2003. Retrieved on 2008-12-17.

2. ^ Kantardzic, Mehmed (2003). Data Mining: Concepts, Models, Methods, and Algorithms. John
Wiley & Sons. ISBN 0471228524. OCLC 50055336.

3. ^ Y. Peng, G. Kou, Y. Shi, Z. Chen (2008). "A Descriptive Framework for the Field of Data Mining
and Knowledge Discovery". International Journal of Information Technology and Decision Making, Volume 7, Issue 4: 639 682. 4. ^ a b Fayyad, Usama; Gregory Piatetsky-Shapiro, and Padhraic Smyth (1996). "From Data Mining to Knowledge Discovery in Databases". http://www.kdnuggets.com/gpspubs/aimag-kdd-overview1996-Fayyad.pdf. Retrieved on 2008-12-17. 5. ^ Government Accountability Office, Data Mining: Early Attention to Privacy in Developing a Key DHS Program Could Reduce Risks, GAO-07-293, Washington, D.C.: February 2007. 6. ^ Secure Flight Program report, MSNBC. 7. ^ "Total/Terrorism Information Awareness (TIA): Is It Truly Dead?" (in English). Electronic Frontier Foundation (official website). 2003. http://w2.eff.org/Privacy/TIA/20031003_comments.php. Retrieved on 2009-03-15. 8. ^ R. Agrawal et al., Fast discovery of association rules, in Advances in knowledge discovery and data mining pp. 307-328, MIT Press, 1996. 9. ^ a b National Research Council, Protecting Individual Privacy in the Struggle Against Terrorists: A Framework for Program Assessment, Washington, DC: National Academies Press, 2008. 10. ^ Stephen Haag et al. (2006). Management Information Systems for the information age. Toronto:

McGraw-Hill Ryerson. pp. 28. ISBN 0-07-095569-7. OCLC 63194770. 11. ^ Ellen Monk, Bret Wagner (2006). Concepts in Enterprise Resource Planning, Second Edition. Thomson Course Technology, Boston, MA. ISBN 0-619-21663-8. OCLC 224465825. 12. ^ Tony Fountain, Thomas Dietterich & Bill Sudyka (2000) Mining IC Test Data to Optimize VLSI Testing, in Proceedings of the Sixth ACM SIGKDD International Conference on Knowledge Discovery & Data Mining. (pp. 18-25). ACM Press. 13. ^ Gareth Herschel (1 July 2008) Magic Quadrant for Customer Data-Mining Applications, Gartner Inc. 14. ^ Xingquan Zhu, Ian Davidson (2007). Knowledge Discovery and Data Mining: Challenges and Realities. Hershey, New Your. pp. 18. ISBN 978-159904252-7. 15. ^ a b A.J. McGrail, E. Gulski et al.. "Data Mining Techniques to Asses the Condition of High Voltage Electrical Plant". CIGRE WG 15.11 of Study Committee 15. 16. ^ R. Baker. "Is Gaming the System State-or-Trait? Educational Data Mining Through the MultiContextual Application of a Validated Behavioral Model". Workshop on Data Mining for User Modeling 2007. 17. ^ J.F. Superby, J-P. Vandamme, N. Meskens. "Determination of factors influencing the achievement of the first-year university students using data mining methods". Workshop on Educational Data Mining 2006. 18. ^ Xingquan Zhu, Ian Davidson (2007). Knowledge Discovery and Data Mining: Challenges and Realities. Hershey, New York. pp. 163189. ISBN 978-159904252-7. 19. ^ ibid. pp. 3148. 20. ^ Yudong Chen, Yi Zhang, Jianming Hu, Xiang Li. "Traffic Data Analysis Using Kernel PCA and Self-Organizing Map". Intelligent Vehicles Symposium, 2006 IEEE. 21. ^ Bate A, Lindquist M, Edwards IR, Olsson S, Orre R, Lansner A, De Freitas RM. A Bayesian neural network method for adverse drug reaction signal generation. Eur J Clin Pharmacol. 1998 Jun;54(4):315-21. 22. ^ Norn GN, Bate A, Hopstadius J, Star K, Edwards IR. Temporal Pattern Discovery for Trends and Transient Effects: Its Application to Patient Records. Proceedings of the Fourteenth International Conference on Knowledge Discovery and Data Mining SIGKDD 2008, pages 963971. Las Vegas NV, 2008. 23. ^ William Seltzer. The Promise and Pitfalls of Data Mining: Ethical Issues. http://www.amstat.org/committees/ethics/linksdir/Jsm2005Seltzer.pdf. 24. ^ Chip Pitts (March 15, 2007). "The End of Illegal Domestic Spying? Don't Count on It". Washington Spectator. http://www.washingtonspectator.com/articles/20070315surveillance_1.cfm. 25. ^ K.A. Taipale (December 15, 2003). "Data Mining and Domestic Security: Connecting the Dots to Make Sense of Data". Columbia Science and Technology Law Review 5 (2). SSRN 546782 / OCLC 45263753. http://www.stlr.org/cite.cgi?volume=5&article=2. 26. ^ John Resig, Ankur Teredesai (2004). "A Framework for Mining Instant Messaging Services". in Proceedings of the 2004 SIAM DM Conference. http://citeseer.ist.psu.edu/resig04framework.html. 27. ^ a b c Think Before You Dig: Privacy Implications of Data Mining & Aggregation, NASCIO Research Brief, September 2004.

(SOURCE: WWW.wikipedia.com, 27/03/2009, search string: data mining)

ELELCTRONIC COMMERCES Slide-206


Electronic commerce, commonly known as e-commerce or eCommerce, consists of the buying and selling of products or services over electronic systems such as the Internet and other computer networks. The amount of trade conducted electronically has grown extraordinarily with

wide-spread Internet usage. A wide variety of commerce is conducted in this way, spurring and drawing on innovations in electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at some point in the transaction's lifecycle, although it can encompass a wider range of technologies such as e-mail as well. ( source: www.wikipedia.com, 27/03/2009, key string: e-commerce)

A large percentage of electronic commerce is conducted entirely electronically for virtual items such as access to premium content on a website, but most electronic commerce involves the transportation of physical items in some way. Online retailers are sometimes known as e-tailers and online retail is sometimes known as e-tail. Almost all big retailers have electronic commerce presence on the World Wide Web. ( source: www.wikipedia.com, 27/03/2009, key string: ecommerce)

Electronic commerce that is conducted between businesses is referred to as business-tobusiness or B2B. B2B can be open to all interested parties (e.g. commodity exchange) or limited to specific, pre-qualified participants (private electronic market). Electronic commerce that is conducted between businesses and consumers, on the other hand, is referred to as business-toconsumer or B2C. This is the type of electronic commerce conducted by companies such as Amazon.com. Electronic commerce is generally considered to be the sales aspect of e-business. It also consists of the exchange of data to facilitate the financing and payment aspects of the business transactions. ( source: www.wikipedia.com, 27/03/2009, key string: e-commerce)

Early development
The meaning of electronic commerce has changed over the last 30 years. Originally, electronic commerce meant the facilitation of commercial transactions electronically, using technology such as Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT). These were both introduced in the late 1970s, allowing businesses to send commercial documents like purchase orders or invoices electronically. The growth and acceptance of credit cards, automated teller machines (ATM) and telephone banking in the 1980s were also forms of electronic commerce. Another form of e-commerce was the airline reservation system typified by Sabre in the USA and Travicom in the UK. Online shopping was invented in the UK in 1979 by Michael Aldrich[citation needed] and during the 1980s it was used extensively particularly by auto manufacturers such as Ford,Peugeot-Talbot, General Motors and Nissan. From the 1990s onwards, electronic commerce would additionally include enterprise resource planning systems (ERP), data mining and data warehousing. ( source: www.wikipedia.com, 27/03/2009, key string: e-commerce)

The earliest[citation needed] example of many-to-many electronic commerce in physical goods was the Boston Computer Exchange, a marketplace for used computers launched in 1982. The first[citation needed] online information marketplace, including online consulting, was likely the American Information Exchange, another pre-Internet[clarification needed] online system introduced in 1991. ( source: www.wikipedia.com, 27/03/2009, key string: e-commerce)

Until 1991, commercial enterprise on the Internet was strictly prohibited.[1] Although the Internet became popular worldwide around 1994, it took about five years to introduce security protocols and DSL allowing continual connection to the Internet. And by the end of 2000, a lot of European and American business companies offered their services through the World Wide Web. Since then people began to associate a word "ecommerce" with the ability of purchasing various goods through the Internet using secure protocols and electronic payment services. ( source: www.wikipedia.com, 27/03/2009, key string: e-commerce)

Timeline

1990: Tim Berners-Lee writes the first web browser, WorldWideWeb, using a NeXT computer. 1992: J.H. Snider and Terra Ziporyn publish Future Shop: How New Technologies Will Change the Way We Shop and What We Buy. St. Martin's Press. ISBN 0312063598. 1994: Netscape releases the Navigator browser in October under the code name Mozilla. Pizza Hut offers pizza ordering on its Web page. The first online bank opens. Attempts to offer flower delivery and magazine subscriptions online. Adult materials also becomes commercially available, as do cars and bikes. Netscape 1.0 is introduced in late 1994 SSL encryption that made transactions secure. 1995: Jeff Bezos launches Amazon.com and the first commercial-free 24 hour, internetonly radio stations, Radio HK and NetRadio start broadcasting. Dell and Cisco begin to aggressively use Internet for commercial transactions. eBay is founded by computer programmer Pierre Omidyar as AuctionWeb. 1998: Electronic postal stamps can be purchased and downloaded for printing from the Web. 1999: Business.com sold for US $7.5 million to eCompanies, which was purchased in 1997 for US $149,000. The peer-to-peer filesharing software Napster launches. 2000: The dot-com bust. 2002: eBay acquires PayPal for $1.5 billion [2]. Niche retail companies CSN Stores and NetShops are founded with the concept of selling products through several targeted domains, rather than a central portal. 2003: Amazon.com posts first yearly profit. 2007: Business.com acquired by R.H. Donnelley for $345 million[3]. 2008: US eCommerce and Online Retail sales projected to reach $204 billion, an increase of 17 percent over 2007[4].

Business applications
Some common applications related to electronic commerce are the following:

Email Enterprise content management

Instant messaging Newsgroups Online shopping and order tracking Online banking Online office suites Domestic and international payment systems Shopping cart software Teleconferencing Electronic tickets

Government regulations
In the United States, some electronic commerce activities are regulated by the Federal Trade Commission (FTC). These activities include the use of commercial e-mails, online advertising and consumer privacy. The CAN-SPAM Act of 2003 establishes national standards for direct marketing over e-mail. The Federal Trade Commission Act regulates all forms of advertising, including online advertising, and states that advertising must be truthful and non-deceptive.[5] Using its authority under Section 5 of the FTC Act, which prohibits unfair or deceptive practices, the FTC has brought a number of cases to enforce the promises in corporate privacy statements, including promises about the security of consumers personal information.[6] As result, any corporate privacy policy related to e-commerce activity may be subject to enforcement by the FTC. To become effective in 2009: the Ryan Haight Online Pharmacy Consumer Protection Act of 2008

Forms
Contemporary electronic commerce involves everything from ordering "digital" content for immediate online consumption, to ordering conventional goods and services, to "meta" services to facilitate other types of electronic commerce. On the consumer level, electronic commerce is mostly conducted on the World Wide Web. An individual can go online to purchase anything from books or groceries, to expensive items like real estate. Another example would be online banking, i.e. online bill payments, buying stocks, transferring funds from one account to another, and initiating wire payment to another country. All of these activities can be done with a few strokes of the keyboard. On the institutional level, big corporations and financial institutions use the internet to exchange financial data to facilitate domestic and international business. Data integrity and security are very hot and pressing issues for electronic commerce today.

See also

E-government E-business Internet business Dot-com company

Paid content Social commerce

Notes
1. ^ Kevin Kelly: We Are the Web Wired magazine, Issue 13.08, August 2005 2. ^ "eBay acquires PayPal". eBay. http://investor.ebay.com/releasedetail.cfm?ReleaseID=84142. 3. ^ "Press Release". Domain Name Wire. http://domainnamewire.com/2007/07/26/rh-donnelleyacquires-businesscom-for-345m/.

4. ^ "The State of Retailing Online 2008". Forrester Research, Inc..


http://www.shop.org/c/journal_articles/view_article_content?groupId=1&articleId=702&version=1.0. 5. ^ "Advertising and Marketing on the Internet: Rules of the Road". Federal Trade Commission. http://www.ftc.gov/bcp/conline/pubs/buspubs/ruleroad.shtm. 6. ^ "Enforcing Privacy Promises: Section 5 of the FTC Act". Federal Trade Commission. http://www.ftc.gov/privacy/privacyinitiatives/promises.html.

References

Chaudhury, Abijit; Jean-Pierre Kuilboer (2002). e-Business and e-Commerce Infrastructure. McGraw-Hill. ISBN 0-07-247875-6. Frieden, Jonathan D.; Roche, Sean Patrick (2006-12-19), "E-Commerce: Legal Issues of the Online Retailer in Virginia" (PDF), Richmond Journal of Law & Technology 13 (2), http://law.richmond.edu/jolt/v13i2/article5.pdf Graham, Mark (2008), "Warped Geographies of Development: The Internet and Theories of Economic Development" (PDF), Geography Compass 2 (3), http://geospace.co.uk/files/compass.pdf Kessler, M. (2003). More shoppers proceed to checkout online. Retrieved January 13, 2004 Nissanoff, Daniel (2006). FutureShop: How the New Auction Culture Will Revolutionize the Way We Buy, Sell and Get the Things We Really Want (Hardcover ed.). The Penguin Press. pp. 246 pages. ISBN 1-59420-077-7. Seybold, Pat (2001). Customers.com. Crown Business Books (Random House). ISBN 0-60960772-3. Miller, Roger (2002). The Legal and E-Commerce Environment Today (Hardcover ed.). Thomson Learning. pp. 741 pages. ISBN 0-324-06188-9.

Slide-207
Edi
Electronic Data Interchange (EDI) refers to the structured transmission of data between organizations by electronic means. It is used to transfer electronic documents from one computer system to another (ie) from one trading partner to another trading partner. It is more than mere Email; for instance, organizations might replace bills of lading and even checks with appropriate EDI messages. It also refers specifically to a family of standards, including the X12 series. However, EDI also exhibits its pre-Internet roots, and the standards tend to focus on ASCII(American Standard Code for Information Interchange)-formatted single messages rather than the whole sequence of conditions and exchanges that make up an inter-organization business process.

In 1992, a survey of Canadian businesses found at least 140 that had adopted some form of EDI, but that many (in the sample) "[had] not benefited from implementing EDI, and that they [had] in fact been disadvantaged by it." [1] The National Institute of Standards and Technology in a 1996 publication [1] defines Electronic Data Interchange as "the computer-to-computer interchange of strictly formatted messages that represent documents other than monetary instruments. EDI implies a sequence of messages between two parties, either of whom may serve as originator or recipient. The formatted data representing the documents may be transmitted from originator to recipient via telecommunications or physically transported on electronic storage media.". It goes on further to say that "In EDI, the usual processing of received messages is by computer only. Human intervention in the processing of a received message is typically intended only for error conditions, for quality review, and for special situations. For example, the transmission of binary or textual data is not EDI as defined here unless the data are treated as one or more data elements of an EDI message and are not normally intended for human interpretation as part of online data processing." [2] EDI can be formally defined as 'The transfer of structured data, by agreed message standards, from one computer system to another without human intervention'. Most other definitions used are variations on this theme. Even in this era of technologies such as XML web services, the Internet and the World Wide Web, EDI is still the data format used by the vast majority of electronic commerce transactions in the world. Generally speaking, EDI is considered to be a technical representation of a business conversation between two entities, either internal or external. Note, there is a perception that "EDI" constitutes the entire electronic data interchange paradigm, including the transmission, message flow, document format, and software used to interpret the documents. EDI is considered to describe the rigorously standardized format of electronic documents. The EDI standards were designed to be independent of communication and software technologies. EDI can be transmitted using any methodology agreed to by the sender and recipient. This includes a variety of technologies, including modem (asynchronous, and bisynchronous), FTP, Email, HTTP, AS1, AS2, etc. It is important to differentiate between the EDI documents and the methods for transmitting them. When they compared the bisynchronous protocol 2400 bit/s modems, CLEO devices, and value-added networks used to transmit EDI documents to transmitting via the Internet, some people equated the non-Internet technologies with EDI and predicted erroneously that EDI itself would be replaced along with the non-Internet technologies. These non-internet transmission methods are being replaced by Internet Protocols such as FTP, telnet, and E-mail, but the EDI documents themselves still remain. As more trading partners use the Internet for transmission, standards have emerged. In 2002, the IETF published RFC 3335, offering a standardized, secure method of transferring EDI data via email. On July 12th, 2005, an IETF working group ratified RFC4130 for MIME-based HTTP EDIINT (aka. AS2) transfers, and is preparing similar documents for FTP transfers (aka. AS3). While some EDI transmission has moved to these newer protocols the providers of the value-added networks remain active. EDI documents generally contain the same information that would normally be found in a paper document used for the same organizational function. For example an EDI 940 ship-fromwarehouse order is used by a manufacturer to tell a warehouse to ship product to a retailer. It

typically has a ship to address, bill to address, a list of product numbers (usually a UPC code) and quantities. It may have other information if the parties agree to include it. However, EDI is not confined to just business data related to trade but encompasses all fields such as medicine (e.g., patient records and laboratory results), transport (e.g., container and modal information), engineering and construction, etc. In some cases, EDI will be used to create a new business information flow (that was not a paper flow before). This is the case in the Advanced Shipment Notification (856) which was designed to inform the receiver of a shipment, the goods to be received and how the goods are packaged. There are four major sets of EDI standards:

The UN-recommended UN/EDIFACT is the only international standard and is predominant outside of North America. The US standard ANSI ASC X12 (X12) is predominant in North America. The TRADACOMS standard developed by the ANA (Article Numbering Association) is predominant in the UK retail industry. The ODETTE standard used within the European automotive industry

All of these standards first appeared in the early to mid 1980s. The standards prescribe the formats, character sets, and data elements used in the exchange of business documents and forms. The complete X12 Document List includes all major business documents, including purchase orders (called "ORDERS" in UN/EDIFACT and an "850" in X12) and invoices (called "INVOIC" in UN/EDIFACT and an "810" in X12). The EDI standard says which pieces of information are mandatory for a particular document, which pieces are optional and give the rules for the structure of the document. The standards are like building codes. Just as two kitchens can be built "to code" but look completely different, two EDI documents can follow the same standard and contain different sets of information. For example a food company may indicate a product's expiration date while a clothing manufacturer would choose to send color and size information. Standards are generally updated each year.

Specifications
Organizations that send or receive documents between each other are referred to as "trading partners" in EDI terminology. The trading partners agree on the specific information to be transmitted and how it should be used. This is done in human readable specifications (also called Message Implementation Guidelines). While the standards are analogous to building codes, the specifications are analogous to blue prints. (The specification may also be called a mapping but the term mapping is typically reserved for specific machine readable instructions given to the translation software.) Larger trading "hubs" have existing Message Implementation Guidelines which mirror their business processes for processing EDI and they are usually unwilling to modify their EDI business practices to meet the needs of their trading partners. Often in a large company these EDI guidelines will be written to be generic enough to be used by different branches or divisions and therefore will contain information not needed for a particular business document exchange. For other large companies, they may create separate EDI guidelines for each branch/division.

Transmission
Trading partners are free to use any method for the transmission of documents. In the past one of the more popular methods was the usage of a bisync modem to communicate through a Value Added Network (VAN). Some organizations have used direct modem to modem connections and Bulletin Board Systems (BBS), and recently there has been a move towards using some of the many Internet protocols for transmission, but most EDI is still transmitted using a VAN. In the healthcare industry, a VAN is referred to as a "Clearinghouse".

Value Added Networks


In the most basic form, a VAN (Valued Added Network) acts as a regional post office. They receive transactions, examine the 'From' and the 'To' information, and route the transaction to the final recipient. VANs provide a number of additional services, e.g. retransmitting documents, providing third party audit information, acting as a gateway for different transmission methods, and handling telecommunications support. Because of these and other services VANs provide, businesses frequently use a VAN even when both trading partners are using Internet-based protocols. Healthcare clearinghouses perform many of the same functions as a VAN, but have additional legal restrictions that govern protected healthcare information. VANs also provide an advantage with certificate replacement in AS2 transmissions. Because each node in a traditionally business-related AS2 transmission usually involves a security certificate, routing a large number of partners through a VAN can make certificate replacement much easier.

Internet/AS2
Until recently, the Internet transmission was handled by nonstandard methods between trading partners usually involving FTP or email attachments. There are also standards for embedding EDI documents into XML. Many organizations are migrating to this protocol to reduce costs. For example, Wal-Mart is now requiring its trading partners to switch to the AS2 protocol (Wal-Mart EDI Requirement). AS2 (Applicability Statement 2) is the draft specification standard by which vendor applications communicate EDI or other business-to-business data (such as XML) over the Internet using HTTP, a standard used by the World Wide Web. AS2 provides security for the transport payload through digital signatures and data encryption, and ensures reliable, non-repudiable delivery through the use of receipts.

Interpreting data
Often missing from the EDI specifications (referred to as EDI Implementation Guidelines) are real world descriptions of how the information should be interpreted by the business receiving it. For example, suppose candy is packaged in a large box that contains 5 display boxes and each display box contains 24 boxes of candy packaged for the consumer. If an EDI document says to ship 10 boxes of candy it may not be clear whether to ship 10 consumer packaged boxes, 240 consumer packaged boxes or 1200 consumer packaged boxes. It is not enough for two parties to agree to use a particular qualifier indicating case, pack, box or each; they must also agree on

what that particular qualifier means. EDI translation software provides the interface between internal systems and the EDI format sent/received. For an "inbound" document the EDI solution will receive the file (either via a Value Added Network or directly using protocols such as FTP or AS2), take the received EDI file (commonly referred to as a "mailbag"), validate that the trading partner who is sending the file is a valid trading partner, that the structure of the file meets the EDI standards and that the individual fields of information conforms to the agreed upon standards. Typically the translator will either create a file of either fixed length, variable length or XML tagged format or "print" the received EDI document (for non-integrated EDI environments). The next step is to convert/transform the file that the translator creates into a format that can be imported into a company's back-end business systems or ERP. This can be accomplished by using a custom program, an integrated proprietary "mapper" or to use an integrated standards based graphical "mapper" using a standard data transformation language such as XSLT. The final step is to import the transformed file (or database) into the company's back-end enterprise resource planning (ERP). For an "outbound" document the process for integrated EDI is to export a file (or read a database) from a company's back-end ERP, transform the file to the appropriate format for the translator. The translation software will then "validate" the EDI file sent to ensure that it meets the standard agreed upon by the trading partners, convert the file into "EDI" format (adding in the appropriate identifiers and control structures) and send the file to the trading partner (using the appropriate communications protocol). Another critical component of any EDI translation software is a complete "audit" of all the steps to move business documents between trading partners. The audit ensures that any transaction (which in reality is a business document) can be tracked to ensure that they are not lost. In case of a retailer sending a Purchase Order to a supplier, if the Purchase Order is "lost" anywhere in the business process, the effect is devastating to both businesses. To the supplier, they do not fulfill the order as they have not received it thereby losing business and damaging the business relationship with their retail client. For the retailer, they have a stock outage and the effect is lost sales, reduced customer service and ultimately lower profits. In EDI terminology "inbound" and "outbound" refer to the direction of transmission of an EDI document in relation to a particular system, not the direction of merchandise, money or other things represented by the document. For example, an EDI document that tells a warehouse to perform an outbound shipment is an inbound document in relation to the warehouse computer system. It is an outbound document in relation to the manufacturer or dealer that transmitted the document.

Slide: 213 Advantages of using EDI over paper systems


EDI and other similar technologies save a company money by providing an alternative to, or replacing information flows that require a great deal of human interaction and materials such as paper documents, meetings, faxes, etc. Even when paper documents are maintained in parallel with EDI exchange, e.g. printed shipping manifests, electronic exchange and the use of data from that exchange reduces the handling costs of sorting, distributing, organizing, and searching paper documents. EDI and similar technologies

allow a company to take advantage of the benefits of storing and manipulating data electronically without the cost of manual entry. Another advantage of EDI is reduced errors, such as shipping and billing errors, because EDI eliminates the need to rekey documents on the destination side. One very important advantage of EDI over paper documents is the speed in which the trading partner receives and incorporates the information into their system thus greatly reducing cycle times. For this reason, EDI can be an important component of just-in-time production systems. ( source; www.wikopedia.com, 27th March 2009, search string: edi)

According to the 2008 Aberdeen report "A Comparison of Suppler Enablement around the Word", only 34% of purchase orders are transmitted electronically in North America. In EMEA, 36% of orders are transmitted electronically and in APAC, 41% of orders are transmitted electronically. They also report that the average paper requisition to order costs a company $37.45 in North America, $42.90 in EMEA and $23.90 in APAC. With an EDI requisition to order costs are reduced to $23.83 in North America, $34.05 in EMEA and 14.78 in APAC. ( source; www.wikopedia.com, 27th March 2009, search string: edi)

Slide: 214 Barriers to implementation


There are a few barriers to adopting electronic data interchange. One of the most significant barriers is the accompanying business process change. Existing business processes built around slow paper handling may not be suited for EDI and would require changes to accommodate automated processing of business documents. For example, a business may receive the bulk of their goods by 1 or 2 day shipping and all of their invoices by mail. The existing process may therefore assume that goods are typically received before the invoice. With EDI, the invoice will typically be sent when the goods ship and will therefore require a process that handles large numbers of invoices whose corresponding goods have not yet been received. ( source; www.wikopedia.com, 27th March 2009, search string: edi)

Slide: 215
Another significant barrier is the cost in time and money in the initial set-up. The preliminary expenses and time that arise from the implementation, customization and training can be costly and therefore may discourage some businesses. The key is to determine what method of integration is right for your company which will determine the cost of implementation. For a business that only receives one P.O. per year from a client, fully integrated EDI may not make economic sense. In this case, businesses may implement inexpensive "rip and read" solutions or use outsourced EDI solutions provided by EDI "Service Bureaus". For other businesses, the implementation of an integrated EDI solution may be necessary as increases in trading volumes brought on by EDI force them to re-implement their order processing business processes. ( source; www.wikopedia.com, 27th March 2009, search string: edi)

The key hindrance to a successful implementation of EDI is the perception many businesses have of the nature of EDI. Many view EDI from the technical perspective that EDI is a data format; it would be more accurate to take the business view that EDI is a system for exchanging business documents with external entities, and integrating the data from those documents into the company's internal systems. Successful implementations of EDI take into account the effect externally generated information will have on their internal systems and validate the business information received. For example, allowing a supplier to update a retailer's Accounts Payables system without appropriate checks and balances would be a recipe for disaster. Businesses new to the implementation of EDI should take pains to avoid such pitfalls. ( source; www.wikopedia.com, 27th March 2009, search string: edi)

Increased efficiency and cost savings drive the adoption of EDI for most trading partners. But even if a company would not choose to use EDI on their own, pressures from larger trading partners (called hubs) often force smaller trading partners to use EDI. An example of this is WalMart`s insistence on using EDI with all of its trading partners; any partner not willing to use EDI with Wal-Mart will not be able to do business with the company. "Wal Mart EDI & Wal Mart RFID". http://www.wal-mart-edi.com/.( source; www.wikopedia.com, 27th March 2009, search string: edi)

Examples of Disadvantages of EDI


United States Health Care Systems
The United States health care system consists of thousands of different companies and other entities. In 1996, the Health Insurance Portability and Accountability Act (HIPAA) was enacted. In short, it set down standard transaction sets for specific EDI transactions and mandated electronic support for every insurance company in the United States for these transactions. While the benefits of EDI are numerous and only increase with increased volume, the drawbacks, though not directly related to EDI itself, include managerial problems in the support, maintenance and implementation of EDI transactions. ( source; www.wikopedia.com, 27th March 2009, search string: edi)

1. Though an EDI standard exists for health care transactions, the standard allows for variation between implementation, which gives way to the existence of Companion Guides, detailing each company's variation[3]. 2. Each entity may have a different method of delivery, ranging from dial-up BBS systems[4]; mailing hard media such as a CD-ROM or tape backup; or FTP[5]. Some entities may elect not to support different methods of delivery depending on a trading partner's expected volume. 3. Due to varying implementation on nearly all points of EDI including contact, registration, submission and testing of transactions between different entities in US health care, the existence of EDI clearinghouses has sprung up. An EDI clearinghouse is one entity agreeing to act as a middle-man between multiple entities and their end-clients, such as between medical providers and insurance companies they accept coverage from. They

may act as a value-added network and attempt to conform their different supported entities to one submission standard. One such example is Emdeon. An EDI clearinghouse will not cover all health care entities, though they may cover a large portion, and they may not cover all HIPAA-mandated transactions for all of their supported entities. 4. Because of the above points, one single computer application cannot handle all health care entities. Though this may not be necessary, it can lead to an obvious management headache as a company attempts to register itself with various EDI partners. This all comes at a massive cost in time and management as a company may attempt to support a broad range of transactions with a broad range of entities. This example is an extension of the lack of strict standards across implementations, transactions and methods. (source; www.wikopedia.com, 27th March 2009, search string: edi)

References
1. ^ Bergeron, Franois; Louis Raymond (1992). "The advantages of electronic data interchange". 2. 3. 4. 5.
ACM SIGMIS Database. 19..31. http://doi.acm.org/10.1145/146553.146556. ^ Kantor, Michael; James H. Burrows (1996-04-29). "ELECTRONIC DATA INTERCHANGE (EDI)". National Institute of Standards and Technology. http://www.itl.nist.gov/fipspubs/fip161-2.htm. Retrieved on 2008-05-13. ^ North Dakota Medicaid Companion Guide ^ Wisconsin Medicaid EDI Information ^ Nebraska Medicaid Submission Requirements

Slide: 216

Internet Protocol Suite


The Internet Protocol Suite (commonly known as TCP/IP) is the set of communications protocols used for the Internet and other similar networks. It is named from two of the most important protocols in it: the Transmission Control Protocol (TCP) and the Internet Protocol (IP), which were the first two networking protocols defined in this standard. Today's IP networking represents a synthesis of several developments that began to evolve in the 1960s and 1970s, namely the Internet and LANs (Local Area Networks), which emerged in the mid- to late-1980s, together with the advent of the World Wide Web in the early 1990s. ( www.wikipedia.com,
27thmarch2009, search string-internet protocol)

The Internet Protocol Suite, like many protocol suites, may be viewed as a set of layers. Each layer solves a set of problems involving the transmission of data, and provides a well-defined service to the upper layer protocols based on using services from some lower layers. Upper layers are logically closer to the user and deal with more abstract data, relying on lower layer protocols to translate data into forms that can eventually be physically transmitted. The TCP/IP model consists of four layers (RFC 1122).[1][2] From lowest to highest, these are the Link Layer, the Internet Layer, the Transport Layer, and the Application Layer.

The Internet Protocol Suite resulted from work done by Defense Advanced Research Projects Agency (DARPA) in the early 1970s. After building the pioneering ARPANET in 1969, DARPA started work on a number of other data transmission technologies. In 1972, Robert E. Kahn was hired at the DARPA Information Processing Technology Office, where he worked on both satellite packet networks and ground-based radio packet networks, and recognized the value of being able to communicate across them. In the spring of 1973, Vinton Cerf, the developer of the existing ARPANET Network Control Program (NCP) protocol, joined Kahn to work on openarchitecture interconnection models with the goal of designing the next protocol generation for the ARPANET. By the summer of 1973, Kahn and Cerf had worked out a fundamental reformulation, where the differences between network protocols were hidden by using a common internetwork protocol, and, instead of the network being responsible for reliability, as in the ARPANET, the hosts became responsible. Cerf credits Hubert Zimmerman and Louis Pouzin, designer of the CYCLADES network, with important influences on this design. With the role of the network reduced to the bare minimum, it became possible to join almost any networks together, no matter what their characteristics were, thereby solving Kahn's initial problem. One popular saying has it that TCP/IP, the eventual product of Cerf and Kahn's work, will run over "two tin cans and a string." There is even an implementation designed to run using homing pigeons, IP over Avian Carriers, documented in RFC 1149.[3][4] A computer called a router (a name changed from gateway to avoid confusion with other types of gateways) is provided with an interface to each network, and forwards packets back and forth between them. Requirements for routers are defined in (Request for Comments 1812).[5] The idea was worked out in more detailed form by Cerf's networking research group at Stanford in the 197374 period, resulting in the first TCP specification (Request for Comments 675) [6]. (The early networking work at Xerox PARC, which produced the PARC Universal Packet protocol suite, much of which existed around the same period of time, was also a significant technical influence; people moved between the two.) DARPA then contracted with BBN Technologies, Stanford University, and the University College London to develop operational versions of the protocol on different hardware platforms. Four versions were developed: TCP v1, TCP v2, a split into TCP v3 and IP v3 in the spring of 1978, and then stability with TCP/IP v4 the standard protocol still in use on the Internet today. In 1975, a two-network TCP/IP communications test was performed between Stanford and University College London (UCL). In November, 1977, a three-network TCP/IP test was conducted between sites in the US, UK, and Norway. Several other TCP/IP prototypes were developed at multiple research centers between 1978 and 1983. The migration of the ARPANET to TCP/IP was officially completed on January 1, 1983 when the new protocols were permanently activated.[7] In March 1982, the US Department of Defense declared TCP/IP as the standard for all military computer networking.[8] In 1985, the Internet Architecture Board held a three day workshop on TCP/IP for the computer industry, attended by 250 vendor representatives, promoting the protocol and leading to its increasing commercial use. ( www.wikipedia.com, 27thmarch2009,
search string-internet protocol)

Kahn and Cerf were honored with the Presidential Medal of Freedom on November 9, 2005 for their contribution to American culture.

[edit] Layers in the Internet Protocol Suite


[edit] The concept of layers
The TCP/IP suite uses encapsulation to provide abstraction of protocols and services. Such encapsulation usually is aligned with the division of the protocol suite into layers of general functionality. In general, an application (the highest level of the model) uses a set of protocols to send its data down the layers, being further encapsulated at each level. ( www.wikipedia.com,
27thmarch2009, search string-internet protocol)

This may be illustrated by an example network scenario, in which two Internet host computers communicate across local network boundaries constituted by their internetworking gateways (routers). TCP/IP stack operating on two hosts connected via two routers and the corresponding layers used at each hop Encapsulation of application data descending through the protocol stack.

The functional groups of protocols and methods are the Application Layer, the Transport Layer, the Internet Layer, and the Link Layer (RFC 1122). It should be noted that this model was not intended to be a rigid reference model into which new protocols have to fit in order to be accepted as a standard. The following table provides some examples of the protocols grouped in their respective layers.

DNS, TFTP, TLS/SSL, FTP, Gopher, HTTP, IMAP, IRC, NNTP, POP3, SIP, SMTP,SMPP, SNMP, SSH, Telnet, Echo, RTP, PNRP, rlogin, ENRP Application Routing protocols like BGP and RIP which run over TCP/UDP, may also be considered part of the Internet Layer.

Transport

TCP, UDP, DCCP, SCTP, IL, RUDP, RSVP

IP (IPv4, IPv6) ICMP, IGMP, and ICMPv6 Internet OSPF for IPv4 was initially considered IP layer protocol since it runs per IP-

subnet, but has been placed on the Link since RFC 2740.

Link

ARP, RARP, OSPF (IPv4/IPv6), IS-IS, NDP

[edit] Layer names and number of layers in the literature


The following table shows the layer names and the number of layers in the TCP/IP model as presented in widespread university course textbooks on computer networking used today.

Forouzan [9] , RFC Arpanet [14] Comer[10], , Cisco [12] [13] Kurose 1188, RFC Stallings Tanenbaum Reference Model Kozierok[11] RFC 1122 Academy[15] 1377, RFC 1982 (RFC 871) 1663

Five layers Five layers

Five layers Four layers

Four layers Four layers Three layers

L5 Application Application Application Application

Application Application Application/Process

L4 Transport

Transport

Host-tohost or transport

Transport

Transport

Transport Host-to-host

L3 Network

Internet

Internet

Internet

Internet

Internetwork

L2 Data link

Data link (Network interface)

Network access

Host-tonetwork

Link

Network interface

Network interface

L1 Physical

(Hardware) Physical

These textbooks are secondary sources that may contravene the intent of RFC 1122 and other IETF primary sources[16]. Different authors have interpreted the RFCs differently regarding whether the Link Layer (and the four-layer TCP/IP model) covers physical layer issues or a "hardware layer" is assumed below the link layer. Some authors have tried to use other names for the Link Layer, such as Network interface layer, in effort to avoid confusion with the Data Link Layer of the seven-layer OSI model. Others have attempted to map the Internet Protocol model onto the seven-layer OSI Model. The

mapping often results in a five-layer TCP/IP model, wherein the Link Layer is split into a Data Link Layer on top of a Physical Layer. Especially in literature with a bottom-up approach to computer networking, where physical layer issues are emphasized, an evolution towards a fivelayer Internet model can be observed out of pedagogical reasons. ( www.wikipedia.com,
27thmarch2009, search string-internet protocol)

The Internet Layer is usually directly mapped to the OSI's Network Layer. At the top of the hierarchy, the Transport Layer is always mapped directly into OSI Layer 4 of the same name. OSIs Application Layer, Presentation Layer, and Session Layer are collapsed into TCP/IP's Application Layer. As a result, these efforts result in either a four- or five-layer scheme with a variety of layer names. This has caused considerable confusion in the application of these models. Other authors dispense with rigid pedagogy[17] focusing instead on functionality and behavior. The Internet protocol stack has never been altered by the Internet Engineering Task Force (IETF) from the four layers defined in RFC 1122. The IETF makes no effort to follow the seven-layer OSI model and does not refer to it in standards-track protocol specifications and other architectural documents. The IETF has repeatedly stated that Internet protocol and architecture development is not intended to be OSI-compliant. ( www.wikipedia.com, 27thmarch2009, search string-internet
protocol)

RFC 3439, addressing Internet architecture, contains a section entitled: "Layering Considered Harmful".[16]

[edit] Implementations
Today, most operating systems include and install a TCP/IP stack by default. For most users, there is no need to look for implementations. TCP/IP is included in all commercial Unix systems, Mac OS X, and all free-software Unix-like systems such as Linux distributions and BSD systems, as well as all Microsoft Windows operating systems. Unique implementations include Lightweight TCP/IP, an open source stack designed for embedded systems and KA9Q NOS, a stack and associated protocols for amateur packet radio systems and personal computers connected via serial lines. ( www.wikipedia.com,
27thmarch2009, search string-internet protocol)

[edit] See also


TCP/IP model Internet Engineering Task Force List of TCP and UDP port numbers OSI Model

[edit] References
1. ^ RFC 1122, Requirements for Internet Hosts -- Communication Layers, R. Braden (ed.), October
1989

2. ^ RFC 1123, Requirements for Internet Hosts -- Application and Support, R. Braden (ed.), October
1989

3. ^ D. Weitzmann (April 1990). [http:www.isi.edu/in-notes/rfc1149.txt "A Standard for the


Transmission of IP Datagrams on Avian Carriers"]. Internet Engineering Task Force. http:www.isi.edu/in-notes/rfc1149.txt. Retrieved on 2007-11-20. 4. ^ Bergen Linux User Group (April 2001). "The informal report from the RFC 1149 event". http://www.blug.linux.no/rfc1149/writeup.html. 5. ^ F. Baker (June 1995). "Requirements for IP Routers". http://www.isi.edu/in-notes/rfc1812.txt. 6. ^ V.Cerf et al (December 1974). "Specification of Internet Transmission Control Protocol". http://www.ietf.org/rfc/rfc0675.txt. 7. ^ Internet History 8. ^ Ronda Hauben. "From the ARPANET to the Internet". TCP Digest (UUCP). http://www.columbia.edu/~rh120/other/tcpdigest_paper.txt. Retrieved on 2007-07-05. 9. ^ Behrouz A. Forouzan, Data Communications and Networking 10. ^ Douglas E. Comer, Internetworking with TCP/IP: Principles, Protocols and Architecture, Pearson Prentice Hall 2005, ISBN 0131876716 11. ^ Charles M. Kozierok, "The TCP/IP Guide", No Starch Press 2005 12. ^ William Stallings, Data and Computer Communications, Prentice Hall 2006, ISBN 0132433109 13. ^ Andrew S. Tanenbaum, Computer Networks, Prentice Hall 2002, ISBN 0130661023 14. ^ James F. Kurose, Keith W. Ross, Computer Networking: A Top-Down Approach, 2007, ISBN 0321497708 15. ^ Mark Dye, Mark A. Dye, Wendell, Network Fundamentals: CCNA Exploration Companion Guide, 2007, ISBN 1587132087 16. ^ a b R. Bush; D. Meyer (December 2002), Some Internet Architectural Guidelines and Philosophy, Internet Engineering Task Force, http://www.isi.edu/in-notes/rfc3439.txt, retrieved on 2007-11-20 17. ^ IP Fundamentals: What Everyone Needs to Know About Addressing and Routing, T. Maufer, Computer Networks, Prentice Hall 1999, ISBN 0130661023

( www.wikipedia.com, 27thmarch2009, search stringinternet protocol) DASHBOARD


In management information systems, a dashboard is an executive information system user interface that (similar to an automobile's dashboard) is designed to be easy to read. For example, a product might obtain information from the local operating system in a computer, from one or more applications that may be running, and from one or more remote sites on the Web and present it as though it all came from the same source. [1]
TYPES OF DAHBOARD

Digital dashboards may be laid out to track the flows inherent in the business processes that they monitor. Graphically, users may see the high-level processes and then drill down into low level data. This level of detail is often buried deep within the corporate enterprise and otherwise unavailable to the senior executives. Three main types of digital dashboard dominate the market today: stand alone software applications, web-browser based applications, and desktop applications also known as desktop

widgets. The last are driven by a widget engine. Specialized dashboards may track all corporate functions. Examples include human resources, recruiting, sales, operations, security, information technology, project management, customer relationship management and many more departmental dashboards. Digital dashboard projects involve business units as the driver and the information technology department as the enabler. The success of digital dashboard projects often rely on the correct selection of metrics to monitor. Key performance indicators, balanced scorecards and sales performance figures are some of the content appropriate on business dashboards.

INTERFACE DESIGN STYLE


To some extent, most graphical user interfaces (GUIs) resemble an automobile dashboard. Although a computer dashboard is more likely to be interactive than an automobile dashboard, some product developers consciously employ this metaphor (and sometimes the term) in the interface design so that the user instantly recognizes the similarity. Some products that aim to integrate information from multiple components into a unified display refer to themselves as dashboards. Based on the metaphor of the instrument panel in a car, the computer or digital dashboard provides a business manager with the input necessary to "drive" the business. Highlights with colors similar to traffic lights, alerts, drill-downs, summaries, graphics such as bar charts, pie charts, bullet graphs, sparklines and gauges are usually set in a portal-like environment that is often role-driven and customizable. HISTORY The idea of digital dashboards followed the study of decision support systems in the 1970s. With the surge of the web in the late 1990s, digital dashboards as we know them today began appearing. Many systems were developed in-house by organizations to consolidate and display data already being gathered in various information systems throughout the organization. Today, digital dashboard technology is available "out-of-the-box" from many software providers. Some companies however continue to do in-house development and maintenance of dashboard applications. For example, GE Aviation has developed a proprietary software/portal called "Digital Cockpit" to monitor the trends in aircraft spare parts business. BENEFIT Digital dashboards allow managers to monitor the contribution of the various departments in their organization. To gauge exactly how well an organization is performing overall, digital dashboards allow you to capture and report specific data points from each department within the organization, thus providing a "snapshot" of performance. Benefits of using digital dashboards include:

Visual presentation of performance measures Ability to identify and correct negative trends Measure efficiencies/inefficiencies Ability to generate detailed reports showing new trends Ability to make more informed decisions based on collected business intelligence Align strategies and organizational goals Save time over running multiple reports Gain total visibility of all systems instantly

REFERENCES:
1. ^ Dictionary definition of dashboards, contributed by Matt Sorenson, SearchCIO.com, 25 February
2002. Retrieved: 9 February 2008.

Bibliography Few, Stephen (2006). Information Dashboard Design. O'Reilly. ISBN 978-0-596-10016-2. Eckerson, Wayne W (2006). Performance Dashboards: Measuring, Monitoring, and Managing Your Business. John Wiley & Sons. ISBN 978-0471778639.

( WWW.WIKIPEDIA.ORG, DATE:01/05/2009, SEARCH STRING: DIGITAL DASHBOARD) ================================= UNIT-II


DECISIONMAKING
Decision making can be regarded as an outcome of mental processes (cognitive process) leading to the selection of a course of action among several alternatives. Every decision making process produces a final choice. According to behavioralist Isabel Briggs Myers, a person's decision making process depends on a significant degree on their cognitive style.

---------------------------------------------------------------------------------Phases in decision making Intelligence- Searching the environment for conditions calling for decision. Data inputs are

obtained, processed, and examined for clues that may identify problems or opportunities. Design Inventing, developing and analyzing possible courses of action. This involves a process to understand the problem, to generate solution, and to test solution for feasibility. Choice- Selecting an alternative course of action from those available. A choice is made and implemented.
(Davis, pp-164)

-----------------------------------------------------------------

Decision Support System


---------------------------------------------------------------------

Classification of decision making:n Programmed and non-programmed decisions. n Historical versus current decisions. n Strategic versus operational decisions

Second Classification n Operational control: Determines how to perform specific tasks set by strategic and
middle-management decision makers

n Knowledge-level decision making: Evaluates new ideas for products, services,


ways to communicate new knowledge, ways to distribute information Third Classification n Unstructured: Non routine, decision maker provides judgment, evaluation, and insights into problem definition, no agreed-upon procedure for decision making n Structured: Repetitive, routine, handled using a definite procedure ---------------------------------------------------------------------------------

EVOLUTIN OF IS: RESONS: 1. computer makes programmed decisions 2. Computer can provide assisting information or compiles decisions In a decision 90% information and 10% decisions.
------------------------------------------------------------------------ Pareto Analysis - Choosing which changes to make Paired Comparison - Working out relative importance Grid Analysis - Making a choice balancing many factors PMI - Weighing the pros and cons of a decision Force Field Analysis - Analyzing pressures for and against change Six Thinking Hats - Looking at all points of view Starbursting - Understanding new ideas by brainstorming questions Stepladder Technique - Making better group decisions Cost/Benefit Analysis - Simple financial decision making Cash Flow Forecasting - Testing the viability of a financial decision Decision Trees - Choosing by projecting possible outcomes ----------------------------------------------------------------------------

Classes of decisions making


1. File Drawer system 2. Data Analysis System: budget analysis system, Alternative investment opportunities 3. Analysis Information System: Marketing Decisions Support System containing internal sales data, promotion and pricing data plus access to external database. Sales analysis sys. With sales data, customer data, forecast data. 4. Accounting Model: to generate estimate of income, Balance Sheet, Monthly Budgeting System for operational decision makes and short term planning. 5. Representational Model: These estimate the consequences of the action on the basis of models that represents some non-definitional characteristics of the system such as probabilities of occurrence. They include all simulation models that contain elements beyond accounting definition. Use: Risk analysis model using probability distribution for each key factor. 6. Optimization Model: minimizing cost is the goal. Use: System for scheduling training classes under a complex set of constraints. 7. Suggestion Model: Insurance Renewal Rate calculation. ----------------------------------------------------------

DSS Users
n Subscription Mode: n Terminal Mode n Clerk Mode

n Intermediary mode n Subscription Mode: The decision maker receives reports that are generated automatically on regular basis. This is a typical mode of usage for management reporting system. E.g. Share market, raw material prices. n Terminal Mode : The decision maker is the direct user of the system through online access. E.g. Web enabled reservation. n Clerk Mode: The decision maker uses system directly but in offline mode. The primary difference between this mode and terminal mode is the technology employed. ( Batch versus online)

e.g.: Budget compilation. (Davis, 374) n Intermediary mode: The decision maker uses the system through intermediaries, who perform the analysis and interpreted and report the result. The decision maker does not need to know how the intermediary used the system to arrive at the requested information. e.g. BSPs ( Davis, 375) -----------------------------------------------------------------------------------------

Computer Resources
SPREADSHEET PROCESSOR:
n VisiCalc n ANALYSIS PACKAGE n Includes Statistical analysis and standard computational model.

MODEL GENERATOR
n Software which generates model for decision making. It has capabilities of Programming Language, Spreadsheet PROCESSOR AND statistical model. Objectives of Model Generator: Quick and easy development of decision model. Feasible and adoptive to develop interactive design o system ----------------------------------------------------------------------------

NOLAN S MODEL
The stages-of-growth model is a theoretical model for the growth of information technology (IT) in a business or similar organization. It was developed by Richard L. Nolan during the 1970s, and published by him in the Harvard Business Review. (Nolan, Richard (1979). "Managing The Crisis In Data Processing". Harvard Business Review 57 (2): 115126. )

Stage I Initiation Stage II Contagion Stage III Control Stage IV Integration Stage V Data administration Stage VI Maturity Stage I Initiation
In this stage, information technology is first introduced into the organization. According to N olans

article in 1973, computers were introduced into companies for two reasons. The first reason deals with the company reaching a size where the administrative processes cannot be accomplished without computers. Also, the success of the business justifies large investment in specialized equipment. The second reason deals with computational needs. Nolan defined the critical size of the company as the most prevalent reason for computer acquisition. Due to the unfamiliarity of personnel with the technology, users tend to take a "hands off" approach to new technology. This introductory software is simple to use and cheap to implement, which provides substantial monetary savings to the company. During this stage, the IT department receives little attention from management and work in a "carefree" atmosphere.[1][2] Stage I Key points: User awareness is characterized as being "hands off". IT personnel are "specialized for technological learning". IT planning and control is not extensive. There is an emphasis on functional applications to reduce costs.

Stage II Contagion
Even though the computers are recognized as change agents in Stage I, Nolan acknowledged that many users become alienated by computing. Because of this, Stage II is characterized by a managerial need to explain the potential of computer applications to alienated users. This leads to the adoption of computers in a range of different areas. A problem that arises in Stage II is that project and budgetary controls are not developed. Unavoidably, this leads to a saturation of existing computer capacity and more sophisticated computer systems being obtained. System sophistication requires employing specialized professionals. Due to the shortage of qualified individuals, implementing these employees results in high salaries. The budget for computer organization rises significantly and causes concern for management. Although the price of Stage II is high, it is evident that planning and control of computer systems is necessary. [1][2] Stage II Key points: There is a proliferation of applications. Users are superficially enthusiastic about using data processing. Management control is even more relaxed. There is a rapid growth of budgets. Treatment of the computer by management is primarily as just a machine. Rapid growth of computer use occurs throughout the organization's functional areas. Computer use is plagued by crisis after crisis.

Stage III Control


Stage III is a reaction against excessive and uncontrolled expenditures of time and money spent on computer systems, and the major problem for management is the organization of tasks for control of computer operating costs. In this stage, project management and management report systems are organized, which leads to development of programming, documentation, and operation standards. During Stage III, a shift occurs from management of computers to management of data resources. This shift is an outcome of analysis of how to increase management control and planning in expending data processing operations. Also, the shift provides flexibility in data processing that is needed in a case of managements new controls. The major characteristic of Stage III is reconstruction of data processing operation.[1][2] Stage III Key points: There is no reduction in computer use. IT division's importance to the organization is greater. Centralized controls are put in place. Applications are often incompatible or inadequate. There is use of database and communications, often with negative general

management reaction. End user frustration is often the outcome.

Stage IV Integration
Stage IV features the adoption of new technology to integrate systems that were previously separate entities. This creates data processing (IT) expenditure growth rates similar to that of Stage II. In the latter half of Stage IV, exclusive reliance on computer controls leads to inefficiencies. The inefficiencies associated with rapid growth may create another wave of problems simultaneously. This is the last stage that Nolan acknowledged in his initial proposal of the stages of growth in 1973.[1][2] Stage IV Key points: There is rise of control by the users. A larger data processing budget growth exists. There is greater demand for on-line database facilities. Data processing department now operates like a computer utility. There is formal planning and control within data processing. Users are more accountable for their applications. The use of steering committees, applications financial planning becomes important. Data processing has better management controls and set standards.

Stage V Data administration


Nolan determined that four stages were not enough to describe the proliferation of IT in an organization and added Stage V in 1979. Stage V features a new emphasis on managing corporate data rather than IT. Like the proceeding Stage VI, it is marked by the development and maturity of the new concept of data administration.[1] Stage V Key points: Data administration is introduced. There is identification of data similarities, its usage, and its meanings within the whole organization. The applications portfolio is integrated into the organization. Data processing department now serves more as an administrator of data resources than of machines. A key difference is the use of term IT/IS rather than data processing.

Stage VI Maturity
Stage VI Key points: Systems now reflect the real information needs of the organization. Data processing organisation is viewed solely as a data resource function. Data processing now emphasizes data resource strategic planning. Ultimately, users and DP department jointly responsible for the use of data resources within the organization. Manager of IT system takes on the same importance in the organizational hierarchy as say the director of finance or director of HR

Initial reaction
Richard Nolans Stages of Growth Model seemed ahead of its time when it was first published in the 1970s.[4]

Legacy
Critics agree that Nolans model presents several shortcomings and is slightly out of date. As time has progressed, Richard Nolans Stages of Growth Model has revealed some apparent weaknesses. However, many agree that this does not take away from his innovative look into the realm of computing development.

Criticism
An argument posed dealt with the main focus on the change in budget, and whether it is reasonable to assume that a single variable serves as a suitable surrogate for so much. [4] It seems logical that this single variable could be an indicator of other variables such as the organizational environment or an organization's learning curve, but not that it is the sole driving force of the entire model. Nolan shows little connection that would make his initial point a valid one. In his model, Richard Nolan states that the force behind the growth of computing through the stages is technological change. King and Kramer[4] find this to be far too general as they say, there are additional factors that should be considered. Most important are the "demand -side" factors that create a ripe environment for technological changes t o be considered and adopted.[4] As proposed, technological change has a multitude of facets that determine its necessity. Change cannot be brought forth unless it is needed under certain circumstances. Unwarranted change would result in excess costs and potential failure of the process. Last, the stages of growth model assumes straightforward organizational goals that are to be determined through the technological change. This can be viewed as very nave from the user perspective. King and Kraemer state, the question of whether organizational goals are uniform and consistent guides for the behavior of organizational actors, as opposed to dynamic and changing targets that result from competition and conflict among organizational actors, has received considerable attention in the literature on computing.[4] Clearly, organizational goals are ever changing and sometimes rigid indicators of direction. They cannot be uniform objectives that are not subject to change. ---------------------------------------------------------------------------

Grid Analysis; Example:


A windsurfing enthusiast is about to replace his car. He needs one that not only carries a board and sails, but also that will be good for business travel. He has always loved open-topped sports cars. No car he can find is good for all three things. His options are: An SUV/4x4, hard topped vehicle. A comfortable 'family car'. A station wagon/estate car. A convertible sports car. Criteria that he wants to consider are: Cost. Ability to carry a sail board safely. Ability to store sails and equipment securely. Comfort over long distances. Fun! Nice look and build quality to car. Firstly he draws up the table shown in Figure 1, and scores each option by how well it satisfies each factor: Figure 1: Example Grid Analysis Showing Unweighted Assessment of How Each Type of Car Satisfies Each Factor Factors: Cost Board Storage Comfort Fun Look Total Weights: 1 0 0 1 3 3 Sports

Car 0 3 2 2 1 1 SUV/4x4 Family 2 2 1 3 0 0 Car Station 2 3 3 3 0 1 Wagon Next he decides the relative weights for each of the factors. He multiplies these by the scores already entered, and totals them. This is shown in Figure 2: Figure 2: Example Grid Analysis Showing Weighted Assessment of How Each Type of Car Satisfies Each Factor Factors: Cost Board Storage Comfort Fun Look Total Weights: 4 5 1 2 3 4 Sports 4 0 0 2 9 12 27 Car 0 15 2 4 3 4 SUV/4x4 28 Family 8 10 1 6 0 0 25 Car Station 8 15 3 6 0 4 36 Wagon This gives an interesting result: Despite its lack of fun, a station wagon may be the best choice. If the wind-surfer still feels unhappy with the decision, maybe he has underestimated the importance of one of the factors. Perhaps he should give 'fun' a weight of 7, and buy an old station wagon to carry his board!

Key points:
Grid Analysis helps you to decide between several options, while taking many different factors into account. To use the tool, lay out your options as rows on a table. Set up the columns to show your factors. Allocate weights to show the importance of each of these factors. Score each choice for each factor using numbers from 0 (poor) to 5 (very good). Multiply each score by the weight of the factor, to show its contribution to the overall selection. Finally add up the total scores for each option. Select the highest scoring option. Grid Analysis is the simplest form of Multiple Criteria Decision Analysis (MCDA), also known as Multiple Criteria Decision Aid or Multiple Criteria Decision Management (MCDM). Sophisticated MCDA is involves highly complex modelling of different potential scenarios and advanced mathematics. ------------------------------------------------------------------------------------------------------

Paired Comparison Analysis


Working Out the Relative Importance of Different Options
Paired Comparison Analysis helps you to work out the importance of a number of options relative to each other. It is particularly useful where you do not have objective data to base this on. This makes it easy to choose the most important problem to solve, or select the solution that will

give you the greatest advantage. Paired Comparison Analysis helps you to set priorities where there are conflicting demands on your resources. It is also an ideal tool for comparing "apples with oranges" completely different options such as whether to invest in marketing, a new IT system or a new piece of machinery. These decisions are usually much harder than comparing three possible new IT systems, for example.

How to Use the Tool:


To use the technique, first download our free worksheet. You can use this to compare each option with each other option, one-by-one. For each comparison, you will decide which of the two options is most important, and then assign a score to show how much more important it is. Follow these steps to use the technique: 1. List the options you will compare. Assign a letter to each option. 2. Mark the options as row and column headings on the worksheet. 3. Note that the cells on the table where you will be comparing an option with itself have been blocked out - there will never be a difference in these cells! 4. The cells on the table where you will be duplicating a comparison are also blocked out. 5. Within the remaining cells compare the option in the row with the one in the column. For each cell, decide which of the two options is more important. Write down the letter of the more important option in the cell, and score the difference in importance from 0 (no difference) to 3 (major difference). 6. Finally, consolidate the results by adding up the total of all the values for each of the options. You may want to convert these values into a percentage of the total score.

Example:
As a simple example, an entrepreneur is looking at ways in which she can expand her business. She has limited resources, but also has the options she lists below:

Expand into overseas markets Expand in home markets Improve customer service Improve quality

Firstly she draws up the Paired Comparison Analysis table in Figure 1: Figure 1: Example Paired Comparison Analysis Table (not filled in): Overseas Market (A) Overseas Market (A) Home Market (B) Blocked Out (Step 3) Blocked Out (Step 4) Blocked Out (Step 3) Home Customer Market (B) Service (C) Quality (D)

Customer Service (C) Quality (D)

Blocked Out (Step 4) Blocked Out (Step 4)

Blocked Blocked Out Out (Step 4) (Step 3) Blocked Blocked Out Out (Step 4) (Step 4)

Blocked Out (Step 3)

Then she compares options, writes down the letter of the most important option, and scores their difference in importance. An example of how she might do this is shown in figure 2: Figure 2: Example Paired Comparison Analysis Table (filled in): Overseas Market (A) Overseas Market (A) Home Market (B) Customer Service (C) Quality (D) Home Customer Market (B) Service (C) A,2 C,1 C,1 Quality (D) A,1 B,1 C,2

Finally she adds up the A, B, C and D values, and converts each into a percentage of the total. This gives these totals:

A = 3 (37.5%) B = 1 (12.5%) C = 4 (50%) D = 0.

Here it is most important to improve customer service (C) and then to tackle export markets (A). Quality is not a high priority - perhaps it is good already.

Key points:
Paired Comparison Analysis is a good way of weighing up the relative importance of different courses of action. It is useful where priorities are not clear, or are competing in importance. The tool provides a framework for comparing each course of action against all others, and helps to show the difference in importance between factors. MindTools.com - Join Our Community! The next technique we look at is Grid Analysis a useful technique that helps us choose between multiple options when there are many factors that we need to consider. To read this,

click "Next article" below. Other relevant destinations are shown in the "Where to go from here" list underneath. -------------------------------------------------------

Force Field Analysis


Understanding the Pressures For and Against Change
Force Field Analysis is a useful technique for looking at all the forces for and against a decision. In effect, it is a specialized method of weighing pros and cons. By carrying out the analysis you can plan to strengthen the forces supporting a decision, and reduce the impact of opposition to it.

How to Use the Tool:


To carry out a force field analysis, first download our free worksheet and then use it to follow these steps:

Describe your plan or proposal for change in the middle. List all forces for change in one column, and all forces against change in another column. Assign a score to each force, from 1 (weak) to 5 (strong).

For example, imagine that you are a manager deciding whether to install new manufacturing equipment in your factory. You might draw up a force field analysis like the one in Figure 1: Drawn using SmartDraw. Click for free download. Once you have carried out an analysis, you can decide whether your project is viable. In the example above, you might initially question whether it is worth going ahead with the plan. Where you have already decided to carry out a project, Force Field Analysis can help you to work out how to improve its probability of success. Here you have two choices:

To reduce the strength of the forces opposing a project, or To increase the forces pushing a project

Often the most elegant solution is the first: just trying to force change through may cause its own problems. People can be uncooperative if change is forced on them. If you had to implement the project in the example above, the analysis might suggest a number of changes to the initial plan:

By training staff (increase cost by 1) you could eliminate fear of technology (reduce fear by

2) It would be useful to show staff that change is necessary for business survival (new force in favor, +2) Staff could be shown that new machines would introduce variety and interest to their jobs (new force, +1) You could raise wages to reflect new productivity (cost +1, loss of overtime -2) Slightly different machines with filters to eliminate pollution could be installed (environmental impact -1)

These changes would swing the balance from 11:10 (against the plan), to 8:13 (in favor of the plan).

Key points:
Force Field Analysis is a useful technique for looking at all the forces for and against a plan. It helps you to weigh the importance of these factors and decide whether a plan is worth implementing. Where you have decided to carry out a plan, Force Field Analysis helps you identify changes that you could make to improve it.

============================================================ UNIT-III

Planning
Why and what to plan and how one plans. Planning is a verb not a noun. Planning is difficult cognitive work and there is evidence Evolution of planning 60s to 70s complicency 80s Pragmatic planning IS STAGES ANALYSIS:IITTM Stages Description 1 1983 Purchase of new computer systems 2 3 1998 Rapid growth/ proliferation without growth plan

initiation contagion

2007 management awareness that computer systems are out of control.

Computer budget is growing period of fee wheeling management slack Control 4 2009 Retooling and redesign of applications to the online responsive mode, database integration 5 IS blue print or road map. 6 Demanding placing IS control in the hands of line management Integration Architecture demassing

NOLANs MODEL Planning Techniques 1. Work breakdown structure

a.

System to subsystem

b. Subsystem to task c. Task to subtask

d. Subtask top workpackage 2. Sequence planning a. Critical path

b. Master project network plan 3. Master programme schedule a. Gantt chart

b. Budgeting 4. Budgeting a. Bottom up

b. Top down 5. Reporting and controlling Control of the project means control of performance/cost/time (p/c/t)

CONTROL
Physical system or process -- Feedback What is control? Control could be for:1. For transaction processing a. Source of document -

Dough

Oven

Bread

b. Output summary can be traced back c. Triggered transactions

2. Information process control a. I.S. management and control i. Maintenance of qualified staff ii. Acquisition of appropriate hardware and software iii. Scheduling and control of work of development staff

iv. Control over software resources of the installation v. Control over maintenance vi. Control over database (definition, authorization for access etc.) vii. Establishment and enforcement of guidelines, standard, and technical support for user facilities 3. Control functions for information processing i. General control procedures 1. Scheduling control for online systems, internal timesharing, and production batch systems 2. Library control for program and data files and documentation 3. Data control for creation, updating and use of database 4. Access control for physical access to computers through terminals 5. Backup and recovery procedures ii. Application development control iii. Control for specific Application 1. Control over offline data recording and preparation 2. Control over data input, in the form of output validation 3. An adequate audit trail 4. Control over access to the files or database 5. Control over distribution and use of output 6. Control over backup and recovery for the application 7. Control over physical security for the application

(Davis, 153) IS support for control IS are used for reporting variance from a standard. Systems correction can be performed by programmable decision rules.

============================================================

UNIT - V

Enterprise Resource Planning


Enterprise Resource Planning systems (ERPs) integrate (or attempt to integrate) all data and

processes of an organization into a unified system. A typical ERP system will use multiple components of computer software and hardware to achieve the integration . A key ingredient of most ERP systems is the use of a unified databse to store data for the various system modules.

ORIGIN:

The term ERP originally implied systems designed to plan the use ofenterprise-wide resources. Although the initialism ERP originated in the manufacturing environment, today's use of the term ERP systems has much broader scope. ERP systems typically attempt to cover all basic functions of an organization, regardless of the organization's business or charter. Businesses, non-profit organizations, nongovernmental organizations, governments, and other large entities utilize ERP systems. Additionally, to be considered an ERP system, a software package generally would only need to provide functionality in a single package that would normally be covered by two or more systems. Technically, a software package that provides both payroll and accounting functions would be considered an ERP software package. However, the term is typically reserved for larger, more broadly based applications. The introduction of an ERP system to replace two or more independent applications eliminates the need for external interfaces previously required between systems, and provides additional benefits that range from standardization and lower maintenance (one system instead of two or more) to easier and/or greater reporting capabilities (as all data is typically kept in one database). Examples of modules in an ERP which formerly would have been stand-alone applications include: manufacturing, Supply cjain management, Customer Relationship Management, Human Resources, wearehouse Management, and decision support system.

OVERVIEW
Some organizations - typically those with sufficient in-house IT skills to integrate multiple software products - choose to implement only portions of an ERP system and develop an external interface to other ERP or stand-alone systems for their other application needs. For instance, the People Soft HRMS and financials systems may be perceived to be better than SAPs HRMS solution. And likewise, some may perceive SAPs manufacturing and CRM systems as better than People Soft equivalents. In this case these organizations may justify the purchase of an ERP system, but choose to purchase the PeopleSoft HRMS and financials modules from Oracle, and their remaining applications from SAP.This is very common in the retail sector, where even a mid-sized retailer will have a discrete Point of Sale (POS) product and financials application, then a series of specialized applications to handle business requirements such as warehouse management, staff rostering, merchandising and logistics. Ideally, ERP delivers a single database that contains all data for the software modules, which would include: Manufacturing Engineering, Bills of Material, Scheduling, Capacity, Workflow Management, Quality Control, Cost Management, Manufacturing Process, Manufacturing Projects, Manufacturing Flow Supply chain management Inventory, Order Entry, Purchasing, Product Configurator, Supply Chain Planning, Supplier Scheduling, Inspection of goods, Claim Processing, Commission Calculation Financials General Ledger, Cash Management, Accounts Payable, Accounts Receivable, Fixed Assets Projects Costing, Billing, Time and Expense, Activity Management Human Resopurces

Human Resources, Payroll, Training, Time & Attendance, Benefits Customer Relationship Management Sales and Marketing, Commissions, Service, Customer Contact and Call Center support Dat Warehouse and various Self-Service interfaces for Customers, Suppliers, and Employees Enterprise Resource Planning is a term originally derived from manufacturing resource planning ( MRO II) that followed material requirements planning (MRP). MRP evolved into ERP when "routings" became a major part of the software architecture and a company's capacity planning activity also became a part of the standard software activity. ERP systems typically handle the manufacturing. Logisctics, distribution, inventory, shipping, invoicing, and accounting for a company. Enterprise Resource Planning or ERP software can aid in the control of many busienss activities, like sales, marketing, delivery, billing, production, inventory management, quality management , and human resource management. ERPs are often incorrectly called back office systems indicating that customers and the general public are not directly involved. This is contrasted with front office systems like Customer Relationship Management (CRM) systems that deal directly with the customers, or the eBusiness systems such as eCommerce, eGovernment, eTelecom, and eFinance, or supplier Customer Relationship Management (SRM) systems. ERPs are cross-functional and enterprise wide. All functional departments that are involved in operations or production are integrated in one system. In addition to manufacturing, warehousing, logistics, and information technology, this would include accounting, human resources, marketing and strategic management. ERP II means open ERP architecture of components. The older, monolithic ERP systems became component oriented. EAS - Enterprise Application Suite is a new name for formerly developed ERP systems which include (almost) all segments of business, using ordinary Internet browsers as thin clients. BEFORE Prior to the concept of ERP systems, departments within an organization (for example, the human resources (HR) department, the payroll department, and the financials department) would have their own computer systems. The HR computer system (often called HRMS or HRIS) would typically contain information on the department, reporting structure, and personal details of employees. The payroll department would typically calculate and store paycheck information. The financials department would typically store financial transactions for the organization. Each system would have to rely on a set of common data to communicate with each other. For the HRIS to send salary information to the payroll system, an employee number would need to be assigned and remain static between the two systems to accurately identify an employee. The financials system was not interested in the employee-level data, but only in the payouts made by the payroll systems, such as the tax payments to various authorities, payments for employee benefits to providers, and so on. This provided complications. For instance, a person could not be paid in the payroll system without an employee number. AFTER ERP software, among other things, combined the data of formerly separate applications. This made the worry of keeping numbers in synchronization across multiple systems disappear. It standardised and reduced the number of software specialities required within larger organizations. BEST PRACTICES Best Practices were also a benefit of implementing an ERP system. When implementing an ERP system, organizations essentially had to choose between customizing the software or modifying their business processes to the "Best Practice" functionality delivered in the vanilla version of the software. Typically, the delivery of best practice applies more usefully to large organizations and especially

where there is a compliance requirement such as IFRS, Sarbane-Oxley or Base II, or where the process is a commodity such as electronic fund transfer. This is because the procedure of capturing and reporting legislative or commodity content can be readily codified within the ERP software, and then replicated with confidence across multiple businesses who have the same business requirement. Where such a compliance or commodity requirement does not underpin the business process, it can be argued that determining and applying a Best Practice actually erodes competitive advantage by homogenizing the business as compared to everyone else in the industry sector.

IMPLEMENTATION

Because of their wide scope of application within a business, ERP software systems are typically complex and usually impose significant changes on staff work practices. Implementing ERP software is typically not an "in-house" skill, so even smaller projects are more cost effective if specialist ERP implementation consultants are employed. The length of time to implement an ERP system depends on the size of the business, the scope of the change and willingness of the customer to take ownership for the project. A small project (e.g., a company of less than 100 staff) may be planned and delivered within 3 onths; however, a large, multi-site or multi-country implementation may take years. The most important aspect of any ERP implementation is that the company who has urchased the ERP solution takes ownership of the project. To implement ERP systems, companies often seek the help of an ERP vendor or of third-party consulting companies. These firms typically provide three areas of professional services: consulting, customization and support

CONSULTING SERVICES:
The Consulting team is typically responsible for your initial ERP implementation and subsequent delivery of work to tailor the system beyond "go live". Typically such tailoring includes additional product training; creation of process triggers and workflow; specialist advice to improve how the ERP is used in the business; system optimization; and assistance writing reports, complex data extracts or implementing Business Intelligence. The consulting team is also responsible for planning and jointly testing the implementation. This is a critical part of the project, and one that is often overlooked. Consulting for a large ERP project involves three levels: systems architecture, business process consulting (primarily re-engineering) and technical consulting (primarily programming and tool configuration activity). A systems architect designs the overall dataflow for the enterprise including the future dataflow plan. A business consultant studies an organization's current business processes and matches them to the corresponding processes in the ERP system, thus 'configuring' the ERP system to the organization's needs. Technical consulting often involves programming. Most ERP vendors allow modification of their software to suit the business needs of their customer. For most mid-sized companies, the cost of the implementation will range from around the list price of the ERP user licenses to up to twice this amount (depending on the level of customization required). Large companies, and especially those with multiple sites or countries, will often spend considerably more on the implementation than the cost of the user licenses -- three to five times more is not uncommon for a multi-site implementation.

CUSTOMISATION SERVICES
Customization is the process of extending or changing how the system works by writing new user interfaces and underlying application code. Such customisations typically reflect local work

practices that are not currently in the core routines of the ERP system software. Examples of such code include early adopter features (e.g., mobility interfaces were uncommon a few years ago and were typically customised) or interfacing to third party applications (this is 'bread and butter' customization for larger implementations as there are typically dozens of ancillary systems that the core ERP software has to interact with). The Professional Services team is also involved during ERP upgrades to ensure that customisations are compatible with the new release. In some cases the functionality delivered via a previous customization may have been subsequently incorporated into the core routines of the ERP software, allowing customers to revert back to standard product and retire the customization completely. Customizing an ERP package can be very expensive and complicated, because many ERP packages are not designed to support customization, so most businesses implement the best practices embedded in the acquired ERP system. Some ERP packages are very generic in their reports and inquiries, such that customization is expected in every implementation. It is important to recognize that for these packages it often makes sense to buy third party plug-ins that interface well with your ERP software rather than reinventing the wheel. Customization work is usually undertaken as bespoke software development on a time and materials basis. Because of the specialist nature of the customization and the 'one off' aspect of the work, it is common to pay in the order of $200 per hour for this work. Also, in many cases the work delivered as customization is not covered by the ERP vendors Maintenance Agreement, so while there is typically a 90-day warranty against software faults in the custom code, there is no obligation on the ERP vendor to warrant that the code works with the next upgrade or point release of the core product. One often neglected aspect of customization is the associated documentation. While it can seem like a considerable -- and expensive -- overhead to the customization project, it is critical that someone is responsible for the creation and user testing of the documentation. Without the description on how to use the customisation, the effort is largely wasted as it becomes difficult to train new staff in the work practice that the customization delivers.

MAINTENANCE AND SUPPORT SERVICES


Once your system has been implemented, the consulting company will typically enter into a Support Agreement to assist your staff to keep the ERP software running in an optimal way. To minimize additional costs and provide more realism into the needs of the units to be affected by ERP (as an added service to customers), the option of creating a committee headed by the consultant using participative management approach during the design stage with the client's heads of departments (no substitutes allowed) to be affected by the changes in ERPs to provide hands on management control requirements planning. This would allow direct long term projections into the client's needs, thus minimizing future conversion patches (at least for the 1st 5 years operation unless there is a corporate-wide organizational structural change involving operational systems) on a more dedicated approach to initial conversion. A Maintenance Agreement typically provides you rights to all current version patches, and both minor and major releases, and will most likely allow your staff to raise support calls. While there is no standard cost for this type of agreement, they are typically between 15% and 20% of the list price of the ERP user licenses. ADVANTAGES In the absence of an ERP system, a large manufacturer may find itself with many software applications that do not talk to each other and do not effectively interface. Tasks that need to interface with one another may involve: Design engineering (how to best make the product) order tracking from acceptance through fulfillment

the revenue cycle from invloice through cash receipt managing interdependencies of complex Bill of Material tracking the 3-way match between Purchase orders (what was ordered), Inventory receipts (what arrived), and Costing (what the vendor invoiced) theA ccounting for all of these tasks, tracking the Revenue, Cost and Proft on a granular level. Change how a product is made, in the engineering details, and that is how it will now be made. Effective dates can be used to control when the switch over will occur from an old version to the next one, both the date that some ingredients go into effect, and date that some are discontinued. Part of the change can include labeling to identify version numbers. Computer security is included within an ERP to protect against both outsider crime, such as industrial espoinage , and insider crime, such as embezzlement. A data tampering scenario might involve a terrorist altering a Bill of Materials so as to put poinson in food products, or other sabotage. ERP security helps to prevent abuse as well. DISADVANTAGES Many problems organizations have with ERP systems are due to inadequate investment in ongoing training for involved personnel, including those implementing and testing changes, as well as a lack of corporate policy protecting the integrity of the data in the ERP systems and how it is used. Limitations of ERP include: Success depends on the skill and experience of the workforce, including training about how to make the system work correctly. Many companies cut costs by cutting training budgets. Privately owned small enterprises are often undercapitalized, meaning their ERP system is often operated by personnel with inadequate education in ERP in general, such as APICS foundations, and in the particular ERP vendor package being used. Personnel turnover; companies can employ new managers lacking education in the company's ERP system, proposing changes in business practices that are out of synchronization with the best utilization of the company's selected ERP. Customization of the ERP software is limited. Some customization may involve changing of the ERP software structure which is usually not allowed. Re-engineering of business processes to fit the "industry standard" prescribed by the ERP system may lead to a loss of competitive advantage. ERP systems can be very expensive to install often ranging from 30,000 to 500,000,000 for multinational companies. ERP vendors can charge sums of money for annual license renewal that is unrelated to the size of the company using the ERP or its profitability. Technical support personnel often give replies to callers that are inappropriate for the caller's corporate structure. Computer security concerns arise, for example when telling a non-programmer how to change a database on the fly, at a company that requires an audit trail of changes so as to meet some regulatory standards. ERPs are often seen as too rigid and too difficult to adapt to the specific workflow and business process of some companiesthis is cited as one of the main causes of their failure. Systems can be difficult to use. Systems are too restrictive and do not allow much flexibility in implementation and usage. The system can suffer from the "weakest link" problem an inefficiency in one department or at one of the partners may affect other participants. Many of the integrated links need high accuracy in other applications to work effectively. A company can achieve minimum standards, then over time "dirty data" will reduce the reliability of some applications.

Once a system is established, switching costs are very high for any one of the partners (reducing flexibility and strategic control at the corporate level). The blurring of company boundaries can cause problems in accountability, lines of responsibility, and employee morale. Resistance in sharing sensitive internal information between departments can reduce the effectiveness of the software. Some large organizations may have multiple departments with separate, independent resources, missions, chains-of-command, etc, and consolidation into a single enterprise may yield limited benefits. There are frequent compatibility problems with the various legacy systems of the partners. The system may be over-engineered relative to the actual needs of the customer. ================================================

E-COMMERCE
Electronic commerce, commonly known as (electronic marketing) e-commerce or eCommerce, consists of the buying and selling of products or services over electronic systems such as the Internet and other computer networks. The amount of trade conducted electronically has grown extraordinarily with widespread Internet usage. The use of commerce is conducted in this way, spurring and drawing on innovations in electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at some point in the transaction's lifecycle, although it can encompass a wider range of technologies such as e-mail as well. A large percentage of electronic commerce is conducted entirely electronically for virtual items such as access to premium content on a website, but most electronic commerce involves the transportation of physical items in some way. Online retailers are sometimes known as e-tailers and online retail is sometimes known as e-tail. Almost all big retailers have electronic commerce presence on the World Wide Web. Electronic commerce that is conducted between businesses is referred to as business-tobusiness or B2B. B2B can be open to all interested parties (e.g. commodity exchange) or limited to specific, pre-qualified participants (private electronic market). Electronic commerce that is conducted between businesses and consumers, on the other hand, is referred to as business-toconsumer or B2C. This is the type of electronic commerce conducted by companies such as Amazon.com. Electronic commerce is generally considered to be the sales aspect of e-business. It also consists of the exchange of data to facilitate the financing and payment aspects of the business transactions.

History [edit] Early development


The meaning of electronic commerce has changed over the last 30 years. Originally, electronic commerce meant the facilitation of commercial transactions electronically, using technology such

as Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT). These were both introduced in the late 1970s, allowing businesses to send commercial documents like purchase orders or invoices electronically. The growth and acceptance of credit cards, automated teller machines (ATM) and telephone banking in the 1980s were also forms of electronic commerce. Another form of e-commerce was the airline reservation system typified by Sabre in the USA and Travicom in the UK. Online shopping, an important component of electronic commerce, was invented by Michael Aldrich in the UK in 1979. The world's first recorded B2B was Thomson Holidays in 1981 [1] The first recorded B2C was Gateshead SIS/Tesco in 1984 [2] The world's first recorded online shopper was Mrs Jane Snowball of Gateshead, England [3] During the 1980s, online shopping was also used extensively in the UK by auto manufacturers such as Ford, Peugeot-Talbot, General Motors and Nissan.[4] All these organizations and others used the Aldrich systems. The systems used the switched public telephone network in dial-up and leased line modes. There was no broadband capability. From the 1990s onwards, electronic commerce would additionally include enterprise resource planning systems (ERP), data mining and data warehousing. An early example of many-to-many electronic commerce in physical goods was the Boston Computer Exchange, a marketplace for used computers launched in 1982. An early online information marketplace, including online consulting, was the American Information Exchange, another pre Internet[clarification needed] online system introduced in 1991. In 1990 Tim Berners-Lee invented the World Wide Web and transformed an academic telecommunication network into a worldwide everyman everyday communication system called internet/www. Commercial enterprise on the Internet was strictly prohibited until 1991 .[5] Although the Internet became popular worldwide around 1994 when the first internet online shopping started, it took about five years to introduce security protocols and DSL allowing continual connection to the Internet. By the end of 2000, many European and American business companies offered their services through the World Wide Web. Since then people began to associate a word "ecommerce" with the ability of purchasing various goods through the Internet using secure protocols and electronic payment services.

[edit] Timeline

1979: Online shopping was invented in the UK by Michael Aldrich. 1982: Minitel was introduced nationwide in France by France Telecom and used for online ordering. 1987: Swreg begins to provide software and shareware authors means to sell their products online through an electronic Merchant account. 1990: Tim Berners-Lee writes the first web browser, WorldWideWeb, using a NeXT computer. 1992: J.H. Snider and Terra Ziporyn publish Future Shop: How New Technologies Will Change the Way We Shop and What We Buy. St. Martin's Press. ISBN 0312063598. 1994: Netscape releases the Navigator browser in October under the code name Mozilla. Pizza Hut offers pizza ordering on its Web page. The first online bank opens. Attempts to offer flower delivery and magazine subscriptions online. Adult materials also becomes commercially available, as do cars and bikes. Netscape 1.0 is introduced in late 1994 SSL encryption that made transactions secure.

1995: Jeff Bezos launches Amazon.com and the first commercial-free 24 hour, internetonly radio stations, Radio HK and NetRadio start broadcasting. Dell and Cisco begin to aggressively use Internet for commercial transactions. eBay is founded by computer programmer Pierre Omidyar as AuctionWeb. 1998: Electronic postal stamps can be purchased and downloaded for printing from the Web. 1999: Business.com sold for US $7.5 million to eCompanies, which was purchased in 1997 for US $149,000. The peer-to-peer filesharing software Napster launches. ATG Stores launches to sell decorative items for the home online. 2000: The dot-com bust. 2002: eBay acquires PayPal for $1.5 billion [6]. Niche retail companies CSN Stores and NetShops are founded with the concept of selling products through several targeted domains, rather than a central portal. 2003: Amazon.com posts first yearly profit. 2007: Business.com acquired by R.H. Donnelley for $345 million[7]. 2008: US eCommerce and Online Retail sales projected to reach $204 billion, an increase of 17 percent over 2007[8].

[edit] Business applications


Some common applications related to electronic commerce are the following:

Email Enterprise content management Instant messaging Newsgroups Online shopping and order tracking Online banking Online office suites Domestic and international payment systems Shopping cart software Teleconferencing Electronic tickets

[edit] Government regulations


In the United States, some electronic commerce activities are regulated by the Federal Trade Commission (FTC). These activities include the use of commercial e-mails, online advertising and consumer privacy. The CAN-SPAM Act of 2003 establishes national standards for direct marketing over e-mail. The Federal Trade Commission Act regulates all forms of advertising, including online advertising, and states that advertising must be truthful and non-deceptive.[9] Using its authority under Section 5 of the FTC Act, which prohibits unfair or deceptive practices, the FTC has brought a number of cases to enforce the promises in corporate privacy statements, including promises about the security of consumers personal information.[10] As result, any corporate privacy policy related to e-commerce activity may be subject to enforcement by the FTC. The Ryan Haight Online Pharmacy Consumer Protection Act of 2008, which came into law in 2008, amends the Controlled Substances Act to address online pharmacies.[11]

[edit] Forms
Contemporary electronic commerce involves everything from ordering "digital" content for immediate online consumption, to ordering conventional goods and services, to "meta" services to facilitate other types of electronic commerce. On the consumer level, electronic commerce is mostly conducted on the World Wide Web. An individual can go online to purchase anything from books or groceries, to expensive items like real estate. Another example would be online banking, i.e. online bill payments, buying stocks, transferring funds from one account to another, and initiating wire payment to another country. All of these activities can be done with a few strokes of the keyboard. On the institutional level, big corporations and financial institutions use the internet to exchange financial data to facilitate domestic and international business. Data integrity and security are very hot and pressing issues for electronic commerce today.

B2B
Business-to-business (B2B) describes commerce transactions between businesses, such as between a manufacturer and a wholesaler, or between a wholesaler and a retailer. Contrasting terms are business-to-consumer (B2C) and business-to-government (B2G). The volume of B2B transactions is much higher than the volume of B2C transactions. The primary reason for this is that in a typical supply chain there will be many B2B transactions involving subcomponent or raw materials, and only one B2C transaction, specifically sale of the finished product to the end customer. For example, an automobile manufacturer makes several B2B transactions such as buying tires, glass for windshields, and rubber hoses for its vehicles. The final transaction, a finished vehicle sold to the consumer, is a single (B2C) transaction.

The term "business-to-business" was originally coined to describe the electronic communications between businesses or enterprises in order to distinguish it from the communications between businesses and consumers (B2C). It eventually came to be used in marketing as well, initially describing only industrial or capital goods marketing. Today it is widely used to describe all products and services used by enterprises. Many professional institutions and the trade publications focus much more on B2C than B2B. This is a strange development as most sales and marketing people work in B2B.

B2C

The term "business-to-business" was originally coined to describe the electronic communications between businesses or enterprises in order to distinguish it from the communications between businesses and consumers (B2C). It eventually came to be used in marketing as well, initially describing only industrial or capital goods marketing. Today it is widely used to describe all products and services used by enterprises. Many professional institutions and the trade publications focus much more on B2C than B2B. This is a strange development as most sales and marketing people work in B2B.

ELECTRONIC DATA INTERCHANGE (EDI)


Electronic Data Interchange (EDI) refers to the structured transmission of data between organizations by electronic means. It is used to transfer electronic documents from one computer system to another, i.e. from one trading partner to another trading partner. It is more than mere E-

mail; for instance, organizations might replace bills of lading and even checks with appropriate EDI messages. It also refers specifically to a family of standards, including the X12 series. However, EDI also exhibits its pre-Internet roots, and the standards tend to focus on ASCII (American Standard Code for Information Interchange)-formatted single messages rather than the whole sequence of conditions and exchanges that make up an inter-organization business process. In 1992, a survey of Canadian businesses found at least 140 that had adopted some form of EDI, but that many (in the sample) "[had] not benefited from implementing EDI, and that they [had] in fact been disadvantaged by it." [1] The National Institute of Standards and Technology in a 1996 publication [1] defines Electronic Data Interchange as "the computer-to-computer interchange of strictly formatted messages that represent documents other than monetary instruments. EDI implies a sequence of messages between two parties, either of whom may serve as originator or recipient. The formatted data representing the documents may be transmitted from originator to recipient via telecommunications or physically transported on electronic storage media.". It goes on further to say that "In EDI, the usual processing of received messages is by computer only. Human intervention in the processing of a received message is typically intended only for error conditions, for quality review, and for special situations. For example, the transmission of binary or textual data is not EDI as defined here unless the data are treated as one or more data elements of an EDI message and are not normally intended for human interpretation as part of online data processing." [2] EDI can be formally defined as 'The transfer of structured data, by agreed message standards, from one computer system to another without human intervention'. Most other definitions used are variations on this theme. Even in this era of technologies such as XML web services, the Internet and the World Wide Web, EDI is still the data format used by the vast majority of electronic commerce transactions in the world.

Standards:
Generally speaking, EDI is considered to be a technical representation of a business conversation between two entities, either internal or external. Note, there is a perception that "EDI" constitutes the entire electronic data interchange paradigm, including the transmission, message flow, document format, and software used to interpret the documents. EDI is considered to describe the rigorously standardized format of electronic documents. The EDI standards were designed to be independent of communication and software technologies. EDI can be transmitted using any methodology agreed to by the sender and recipient. This includes a variety of technologies, including modem (asynchronous, and bisynchronous), FTP, E-mail, HTTP, AS1, AS2, etc. It is important to differentiate between the EDI documents and the methods for transmitting them. When they compared the bisynchronous protocol 2400 bit/s modems, CLEO devices, and value-added networks used to transmit EDI documents to transmitting via the Internet, some people equated the non-Internet technologies with EDI and predicted erroneously that EDI itself would be replaced along with the non-Internet technologies. These non-internet transmission methods are being replaced by Internet Protocols such as FTP, telnet, and E-mail, but the EDI documents themselves still remain. As more trading partners use the Internet for transmission, standards have emerged. In 2002, the

IETF published RFC 3335, offering a standardized, secure method of transferring EDI data via email. On July 12, 2005, an IETF working group ratified RFC4130 for MIME-based HTTP EDIINT (aka. AS2) transfers, and is preparing a similar RFC for FTP transfers (aka. AS3). While some EDI transmission has moved to these newer protocols, the providers of the value-added networks remain active. EDI documents generally contain the same information that would normally be found in a paper document used for the same organizational function. For example an EDI 940 ship-fromwarehouse order is used by a manufacturer to tell a warehouse to ship product to a retailer. It typically has a ship to address, bill to address, a list of product numbers (usually a UPC code) and quantities. It may have other information if the parties agree to include it. However, EDI is not confined to just business data related to trade but encompasses all fields such as medicine (e.g., patient records and laboratory results), transport (e.g., container and modal information), engineering and construction, etc. In some cases, EDI will be used to create a new business information flow (that was not a paper flow before). This is the case in the Advanced Shipment Notification (856) which was designed to inform the receiver of a shipment, the goods to be received and how the goods are packaged. There are four major sets of EDI standards:

The UN-recommended UN/EDIFACT is the only international standard and is predominant outside of North America. The US standard ANSI ASC X12 (X12) is predominant in North America. The TRADACOMS standard developed by the ANA (Article Numbering Association) is predominant in the UK retail industry. The ODETTE standard used within the European automotive industry

All of these standards first appeared in the early to mid 1980s. The standards prescribe the formats, character sets, and data elements used in the exchange of business documents and forms. The complete X12 Document List includes all major business documents, including purchase orders (called "ORDERS" in UN/EDIFACT and an "850" in X12) and invoices (called "INVOIC" in UN/EDIFACT and an "810" in X12). The EDI standard says which pieces of information are mandatory for a particular document, which pieces are optional and give the rules for the structure of the document. The standards are like building codes. Just as two kitchens can be built "to code" but look completely different, two EDI documents can follow the same standard and contain different sets of information. For example a food company may indicate a product's expiration date while a clothing manufacturer would choose to send color and size information. Standards are generally updated each year. ======================================================

CRM
Customer relationship management (CRM) are methods that companies use to interact with customers. The methods include employee training and special purpose CRM software. There is an emphasis on handling incoming customer phone calls and email, although the information collected by CRM software may also be used for promotion, and surveys such as those polling

customer satisfaction. Initiatives often fail because implementation was limited to software installation, without providing the context, support and understanding for employees to learn.[1] Tools for customer relationship management should be implemented "only after a well-devised strategy and operational plan are put in place".[2] Other problems occur[3] when failing to think of sales as the output of a process that itself needs to be studied and taken into account when planning automation[4]. From the outside, customers interacting with a company perceive the business as a single entity, despite often interacting with a number of employees in different roles and departments. CRM is a combination of policies, processes, and strategies implemented by an organization to unify its customer interactions and provide a means to track customer information. It involves the use of technology in attracting new and profitable customers, while forming tighter bonds with existing ones. CRM includes many aspects which relate directly to one another:

Front office operations Direct interaction with customers, e.g. face to face meetings, phone calls, e-mail, online services etc. Back office operations Operations that ultimately affect the activities of the front office (e.g., billing, maintenance, planning, marketing, advertising, finance, manufacturing, etc.) Business relationships Interaction with other companies and partners, such as suppliers/vendors and retail outlets/distributors, industry networks (lobbying groups, trade associations). This external network supports front and back office activities. Analysis Key CRM data can be analyzed in order to plan target-marketing campaigns, conceive business strategies, and judge the success of CRM activities (e.g., market share, number and types of customers, revenue, profitability).

Proponents of CRM software claim that it doesn't only allow more effective ways of managing customer relationships, but also more customer-centric ways of doing business[5]. Executives often cite the need for the proper tools as a barrier to delivering the experience their customers expect. A 2009 study of over 860 corporate executives revealed only 39% believe that their employees have tools and authority to solve customer problems. [6]

TYPES OF CRM:
There are several different approaches to CRM, with different software packages focusing on different aspects. In general, Customer Service, Campaign Management and Sales Force Automation (SFA) form the core of the system.

[edit] Operational CRM


Operational CRM provides support to "front office" business processes, e.g. to sales, marketing and service staff. Interactions with customers are generally stored in customers' contact histories, and staff can retrieve customer information as necessary. The contact history provides staff members with immediate access to important information on

the customer (products owned, prior support calls etc.), eliminating the need to individually obtain this information directly from the customer. Reaching to the customer at right time at right place is preferable. Operational CRM processes customer data for a variety of purposes:

Managing campaigns Enterprise Marketing Automation Sales Force Automation Sales Management System

[edit] Analytical CRM


Analytical CRM analyzes customer data for a variety of purposes:

Designing and executing targeted marketing campaigns Designing and executing campaigns, e.g. customer acquisition, cross-selling, up-selling, addon-selling Analyzing customer behavior in order to make decisions relating to products and services (e.g. pricing, product development) Management information system (e.g. financial forecasting and customer profitability analysis)

Analytical CRM generally makes heavy use of data mining and other techniques to produce useful results for decision-making. It is at the analytical stage that the importance of fully integrated CRM software becomes most apparent. Logically speaking, the more information that the analytical software has available for analysis, the better its predictions and recommendations will be.

[edit] Sales Intelligence CRM


Sales Intelligence CRM is similar to Analytical CRM, but is intended as a more direct sales tool. Features include alerts sent to sales staff regarding:

Cross-selling/Up-selling/Switch-selling opportunities Customer drift Sales performance Customer trends Customer margins Customer alignment

[edit] Campaign Management


Campaign management combines elements of Operational and Analytical CRM. Campaign management functions include:

Target groups formed from the client base according to selected criteria Sending campaign-related material (e.g. on special offers) to selected recipients using various channels (e.g. e-mail, telephone, SMS, post) Tracking, storing, and analyzing campaign statistics, including tracking responses and

analyzing trends

[edit] Collaborative CRM


Collaborative CRM covers aspects of a company's dealings with customers that are handled by various departments within a company, such as sales, technical support and marketing. Staff members from different departments can share information collected when interacting with customers. For example, feedback received by customer support agents can provide other staff members with information on the services and features requested by customers. Collaborative CRM's ultimate goal is to use information collected by all departments to improve the quality of services provided by the company.[7] CRM also plays a role of data distributor within customers, producers and partners. Producers can use CRM information to develop products or find new market. CRM facilitates communication between customers, suppliers and partner by using new information system such email, link and data bank.

[edit] Consumer Relationship CRM


Consumer Relationship System (CRS) covers aspects of a company's dealing with customers handled by the Consumer Affairs and Customer Relations contact centers within a company.[1] Representatives handle in-bound contact from anonymous consumers and customers. Early warnings can be issued regarding product issues (e.g. item recalls) and current consumer sentiment can be tracked (voice of the customer).

[edit] Simple CRM


A relatively new spinoff of the traditional CRM model first appearing in 2006. At their core, CRM tools are designed to manage customer relationships. As described above there are countless supplemental features and capabilities. Simple CRM systems breakdown the traditional CRM system to focus on the core values--managing contacts and activities with customers and prospects. These systems are designed to create the most value for the immediate end user rather than the organization as a whole. Many times they focus on satisfying the needs of a particular marketplace niche, organizational unit, or type of user rather than an entire organization.

[edit] Social CRM


Beginning in 2007, the rapid growth in social media and social networking forced CRM product companies to integrate "social" features into their traditional CRM systems. Some of the first features added are social network monitoring feeds (ie Twitter timeline), typically built into the system dashboard. Other emerging capabilities include messaging, sentiment analysis, and other analytics. Many industry experts contend that Social CRM is the way of the future, but there are still many skeptics. Top CRM minds agree that online social communities and conversations carry heavy consequences for companies. They must be monitored for real-time marketplace feedback and trends.

[edit] Strategy
Several CRM software packages are available, and they vary in their approach to CRM. However, as mentioned above, CRM is not just a technology but rather a comprehensive,

customer-centric approach to an organization's philosophy of dealing with its customers. This includes policies and processes, front-of-house customer service, employee training, marketing, systems and information management. Hence, it is important that any CRM implementation considerations stretch beyond technology toward the broader organizational requirements. The objectives of a CRM strategy must consider a companys specific situation and its customers' needs and expectations. Information gained through CRM initiatives can support the development of marketing strategy by developing the organization's knowledge in areas such as identifying customer segments, improving customer retention, improving product offerings (by better understanding customer needs), and by identifying the organization's most profitable customers.[8] CRM strategies can vary in size, complexity, and scope. Some companies consider a CRM strategy only to focus on the management of a team of salespeople. However, other CRM strategies can cover customer interaction across the entire organization. Many commercial CRM software packages provide features that serve the sales, marketing, event management, project management, and finance industries. From this perspective, CRM has for some time been seen to play an important role in many sales process engineering efforts[9]. IMPLEMENTATION ISSUES:Many CRM project "failures" are also related to data quality and availability. Data cleaning is a major issue. If a company's CRM strategy is to track life-cycle revenues, costs, margins, and interactions between individual customers, this must be reflected in all business processes. Data must be extracted from multiple sources (e.g., departmental/divisional databases such as sales, manufacturing, supply chain, logistics, finance, service etc.), which requires an integrated, comprehensive system in place with well-defined structures and high data quality. Data from other systems can be transferred to CRM systems using appropriate interfaces. Because of the company-wide size and scope of many CRM implementations, significant preplanning is essential for smooth roll-out. This pre-planning involves a technical evaluation of the data available and the technology employed in existing systems. This evaluation is critical to determine the level of effort needed to integrate this data. Equally critical is the human aspect of the implementation. A successful implementation requires an understanding of the expectations and needs of the stakeholders involved. An executive sponsor should also be obtained to provide high-level management representation of the CRM project. An effective tool for identifying technical and human factors before beginning a CRM project is a pre-implementation checklist.[10] A checklist can help ensure any potential problems are identified early in the process. PRIVACY AND DATA SECURITY: Many CRM project "failures" are also related to data quality and availability. Data cleaning is a major issue. If a company's CRM strategy is to track life-cycle revenues, costs, margins, and interactions between individual customers, this must be reflected in all business processes. Data

must be extracted from multiple sources (e.g., departmental/divisional databases such as sales, manufacturing, supply chain, logistics, finance, service etc.), which requires an integrated, comprehensive system in place with well-defined structures and high data quality. Data from other systems can be transferred to CRM systems using appropriate interfaces. Because of the company-wide size and scope of many CRM implementations, significant preplanning is essential for smooth roll-out. This pre-planning involves a technical evaluation of the data available and the technology employed in existing systems. This evaluation is critical to determine the level of effort needed to integrate this data. Equally critical is the human aspect of the implementation. A successful implementation requires an understanding of the expectations and needs of the stakeholders involved. An executive sponsor should also be obtained to provide high-level management representation of the CRM project. An effective tool for identifying technical and human factors before beginning a CRM project is a pre-implementation checklist.[10] A checklist can help ensure any potential problems are identified early in the process. MARKECT STRUCTURE: The following table lists the top CRM software vendors in 2006-2007 (figures in millions of US dollars) published in a Gartner study.[11]

Vendor

2007 Revenue

2007 Share 2006 (%) Revenue 1,016.8 1,681.7 451.7 365.9 176.1 2,881.6 6,573.8

2006 Share '06-'07 (%) Growth (%) 15.5 26.6 6.9 5.6 2.7 43.7 100 29.8 22.0 49.8 15.1 88.6 14.1 23.1

'06-'07 Change in share (%) +0.8 -1.3 +1.4 -0.4 +1.4 -3.1 0

Oracle SAP Salesforce.com Amdocs Microsoft Others Total

1,319.8 16.3 2,050.8 25.3 676.5 8.3 421.0 5.2 332.1 4.1 3,289.1 40.6 8,089.3 100

The following table lists the top software vendors for CRM projects completed in 2006 using

external consultants and system integrators, according to a 2007 Gartner study.[12]

Vendor Siebel (Oracle) SAP Epiphany (Infor) Oracle PeopleSoft (Oracle) salesforce.com Amdocs Chordiant Microsoft Metus Technology SAS Others None

Percentage of implementations 41% 8% 3% 3% 2% 2% 1% 1% 1% 1% 1% 15% 22%

A 2007 Datamonitor report [13] lists Oracle (including Siebel) and SAP as the top CRM vendors, with Chordiant, Infor, and SalesForce.com as significant, smaller vendors. REFERENCES: 1. ^ Rigby, Darrell K.; Frederick F. Reichheld, Phil Schefter (2002). "Avoid the four perils of CRM".
Harvard Business Review 80 (2): 101109. doi:10.1225/8946.

2. ^ Arussy, Lior (2005). "Understanding the Fatal Mistakes". Passionate & Profitable: Why Customer
Strategies Fail and 10 Steps to Do them Right. John Wiley & Sons, Inc.. p. 151.

3. ^ Paul H. Selden (April/May 1996). "SFA Myths Abound". Sales and Marketing Strategies & News 6
(3): 51 and 53.

4. ^ Paul H. Selden (November 2000). "The Power of Quality Thinking In Sales and Management".
Quality Progress: 58-64. 5. ^ Interview with Dick Lee at Effective CRM 6. ^ Strativity Group (2009), 2009 Global Customer Experience Management Benchmark Study, Strativity Group, Inc., http://strativity.com/products/2009-Experience-Management-Benchmark-Study.aspx 7. ^ Edwards, John (2007-11-29). "Get It Together with Collaborative CRM". insideCRM. Tippit. http://www.insidecrm.com/features/collaborative-crm-112907/. Retrieved 2008-02-01. 8. ^ Bligh, Philip; Douglas Turk (2004). CRM unplugged releasing CRM's strategic value. Hoboken: John Wiley & Sons. ISBN 0-471-48304-4. 9. ^ Paul H. Selden (1997). Sales Process Engineering: A Personal Workshop. Milwaukee, WI: ASQ Quality Press. p. 23. 10. ^ Dyche, 2002, Managing Your CRM Project 11. ^ Gartner, Inc (2008-09-12). "Gartner Says Worldwide Customer Relationship Management Market Grew 23 Percent in 2007". Press release. http://www.gartner.com/it/page.jsp?id=715308. Retrieved 2008-08-15. 12. ^ Gartner, Inc. (22 June 2007) Commonly Deployed CRM Application Vendors in 2006 13. ^ Datamonitor (22 August 2007). Datamonitor suggests Oracle, SAP likely to remain atop CRM market

SUPPLY CHAIN MANAGEMENT


Supply chain management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers (Harland, 1996). Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption (supply chain). Another definition is provided by the APICS Dictionary when it defines SCM as the "design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand, and measuring performance globally." Supply chain management encompasses the planning and management of all activities involved in sourcing, procurement, conversion, and logistics management. It also includes the crucial components of coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers. In essence, supply chain management integrates supply and demand management within and across companies. More recently, the loosely coupled, self-organizing network of businesses that cooperate to provide product and service offerings has been called the Extended Enterprise. Supply chain management can also refer to supply chain management software which includes tools or modules used to execute supply chain transactions, manage supplier relationships and control associated business processes. Supply chain event management (abbreviated as SCEM) is a consideration of all possible events and factors that can disrupt a supply chain. With SCEM possible scenarios can be created and

solutions devised.

DEVELOPMENT OF SCM:
Six major movements can be observed in the evolution of supply chain management studies: Creation, Integration, and Globalization (Lavassani et al., 2008a), Specialization Phases One and Two, and SCM 2.0. 1. Creation Era The term supply chain management was first coined by a U.S. industry consultant in the early 1980s. However, the concept of a supply chain in management was of great importance long before, in the early 20th century, especially with the creation of the assembly line. The characteristics of this era of supply chain management include the need for large-scale changes, re-engineering, downsizing driven by cost reduction programs, and widespread attention to the Japanese practice of management. 2. Integration Era This era of supply chain management studies was highlighted with the development of Electronic Data Interchange (EDI) systems in the 1960s and developed through the 1990s by the introduction of Enterprise Resource Planning (ERP) systems. This era has continued to develop into the 21st century with the expansion of internet-based collaborative systems. This era of supply chain evolution is characterized by both increasing value-adding and cost reductions through integration. 3. Globalization Era The third movement of supply chain management development, the globalization era, can be characterized by the attention given to global systems of supplier relationships and the expansion of supply chains over national boundaries and into other continents. Although the use of global sources in the supply chain of organizations can be traced back several decades (e.g., in the oil industry), it was not until the late 1980s that a considerable number of organizations started to integrate global sources into their core business. This era is characterized by the globalization of supply chain management in organizations with the goal of increasing their competitive advantage, value-adding, and reducing costs through global sourcing. 4. Specialization EraPhase One: Outsourced Manufacturing and Distribution In the 1990s industries began to focus on core competencies and adopted a specialization model. Companies abandoned vertical integration, sold off non-core operations, and outsourced those functions to other companies. This changed management requirements by extending the supply chain well beyond company walls and distributing management across specialized supply chain partnerships. This transition also re-focused the fundamental perspectives of each respective organization. OEMs became brand owners that needed deep visibility into their supply base. They had to control the entire supply chain from above instead of from within. Contract manufacturers had to manage bills of material with different part numbering schemes from multiple OEMs and support

customer requests for work -in-process visibility and vendor-managed inventory (VMI). The specialization model creates manufacturing and distribution networks composed of multiple, individual supply chains specific to products, suppliers, and customers who work together to design, manufacture, distribute, market, sell, and service a product. The set of partners may change according to a given market, region, or channel, resulting in a proliferation of trading partner environments, each with its own unique characteristics and demands. 5. Specialization EraPhase Two: Supply Chain Management as a Service Specialization within the supply chain began in the 1980s with the inception of transportation brokerages, warehouse management, and non-asset-based carriers and has matured beyond transportation and logistics into aspects of supply planning, collaboration, execution and performance management. At any given moment, market forces could demand changes from suppliers, logistics providers, locations and customers, and from any number of these specialized participants as components of supply chain networks. This variability has significant effects on the supply chain infrastructure, from the foundation layers of establishing and managing the electronic communication between the trading partners to more complex requirements including the configuration of the processes and work flows that are essential to the management of the network itself. Supply chain specialization enables companies to improve their overall competencies in the same way that outsourced manufacturing and distribution has done; it allows them to focus on their core competencies and assemble networks of specific, best-in-class partners to contribute to the overall value chain itself, thereby increasing overall performance and efficiency. The ability to quickly obtain and deploy this domain-specific supply chain expertise without developing and maintaining an entirely unique and complex competency in house is the leading reason why supply chain specialization is gaining popularity. Outsourced technology hosting for supply chain solutions debuted in the late 1990s and has taken root primarily in transportation and collaboration categories. This has progressed from the Application Service Provider (ASP) model from approximately 1998 through 2003 to the OnDemand model from approximately 2003-2006 to the Software as a Service (SaaS) model currently in focus today. 6. Supply Chain Management 2.0 (SCM 2.0) Building on globalization and specialization, the term SCM 2.0 has been coined to describe both the changes within the supply chain itself as well as the evolution of the processes, methods and tools that manage it in this new "era". Web 2.0 is defined as a trend in the use of the World Wide Web that is meant to increase creativity, information sharing, and collaboration among users. At its core, the common attribute that Web 2.0 brings is to help navigate the vast amount of information available on the Web in order to find what is being sought. It is the notion of a usable pathway. SCM 2.0 follows this notion into supply chain operations. It is the pathway to SCM results, a combination of the processes, methodologies, tools and delivery options to guide companies to their results quickly as the complexity and speed of the supply chain increase due to the effects of global competition, rapid price fluctuations, surging oil prices, short product life cycles, expanded specialization,

near-/far- and off-shoring, and talent scarcity. SCM 2.0 leverages proven solutions designed to rapidly deliver results with the agility to quickly manage future change for continuous flexibility, value and success. This is delivered through competency networks composed of best-of-breed supply chain domain expertise to understand which elements, both operationally and organizationally, are the critical few that deliver the results as well as through intimate understanding of how to manage these elements to achieve desired results. Finally, the solutions are delivered in a variety of options, such as no-touch via business process outsourcing, mid-touch via managed services and software as a service (SaaS), or high touch in the traditional software deployment model.

=============================== DATA WAREHOUSING:


Data warehouse is a repository of an organization's electronically stored data. Data warehouses are designed to facilitate reporting and analysis[1]. A data warehouse houses a standardized, consistent, clean and integrated form of data sourced from various operational systems in use in the organization, structured in a way to specifically address the reporting and analytic requirements. This definition of the data warehouse focuses on data storage. However, the means to retrieve and analyze data, to extract, transform and load data, and to manage the data dictionary are also considered essential components of a data warehousing system. Many references to data warehousing use this broader context. Thus, an expanded definition for data warehousing includes business intelligence tools, tools to extract, transform, and load data into the repository, and tools to manage and retrieve metadata.

HISTORY OF DATA WAREHOUSING:


The concept of data warehousing dates back to the late 1980s [2] when IBM researchers Barry Devlin and Paul Murphy developed the "business data warehouse". In essence, the data warehousing concept was intended to provide an architectural model for the flow of data from operational systems to decision support environments. The concept attempted to address the various problems associated with this flow - mainly, the high costs associated with it. In the absence of a data warehousing architecture, an enormous amount of redundancy was required to support multiple decision support environments. In larger corporations it was typical for multiple decision support environments to operate independently. Each environment served different users but often required much of the same data. The process of gathering, cleaning and integrating data from various sources, usually long existing operational systems (usually referred to as legacy systems), was typically in part replicated for each environment. Moreover, the operational systems were frequently reexamined as new decision support requirements emerged. Often new requirements necessitated gathering, cleaning and integrating new data from"data marts" that were tailored for ready access by users. Key developments in early years of data warehousing were:

1960s - General Mills and Dartmouth College, in a joint research project, develop the terms dimensions and facts.[3]

1970s - ACNielsen and IRI provide dimensional data marts for retail sales.[3] 1983 - Teradata introduces a database management system specifically designed for decision support. 1988 - Barry Devlin and Paul Murphy publish the article An architecture for a business and information systems in IBM Systems Journal where they introduce the term "business data warehouse". 1990 - Red Brick Systems introduces Red Brick Warehouse, a database management system specifically for data warehousing. 1991 - Prism Solutions introduces Prism Warehouse Manager, software for developing a data warehouse. 1991 - Bill Inmon publishes the book Building the Data Warehouse. 1995 - The Data Warehousing Institute, a for-profit organization that promotes data warehousing, is founded. 1996 - Ralph Kimball publishes the book The Data Warehouse Toolkit. 1997 - Oracle 8, with support for star queries, is released.

BENEFITS:
Some of the benefits that a data warehouse provides are as follows:

[7][8]

A data warehouse provides a common data model for all data of interest regardless of the data's source. This makes it easier to report and analyze information than it would be if multiple data models were used to retrieve information such as sales invoices, order receipts, general ledger charges, etc. Prior to loading data into the data warehouse, inconsistencies are identified and resolved. This greatly simplifies reporting and analysis. Information in the data warehouse is under the control of data warehouse users so that, even if the source system data is purged over time, the information in the warehouse can be stored safely for extended periods of time. Because they are separate from operational systems, data warehouses provide retrieval of data without slowing down operational systems. Data warehouses can work in conjunction with and, hence, enhance the value of operational business applications, notably customer relationship management (CRM) systems. Data warehouses facilitate decision support system applications such as trend reports (e.g., the items with the most sales in a particular area within the last two years), exception reports, and reports that show actual performance versus goals.

DISADVANTAGES:There are also disadvantages to using a data warehouse. Some of them are:

Data warehouses are not the optimal environment for unstructured data. Because data must be extracted, transformed and loaded into the warehouse, there is an element of latency in data warehouse data. Over their life, data warehouses can have high costs. Maintenance costs are high. Data warehouses can get outdated relatively quickly. There is a cost of delivering suboptimal information to the organization. There is often a fine line between data warehouses and operational systems. Duplicate, expensive functionality may be developed. Or, functionality may be developed in the data warehouse that, in retrospect, should have been developed in the operational systems and

vice versa.

REFERENCES:
1. Inmon, W.H. Tech Topic: What is a Data Warehouse? Prism Solutions. Volume 1. 1995. 2. "The Story So Far". 2002-04-15.
http://www.computerworld.com/databasetopics/data/story/0,10801,70102,00.html. Retrieved 200809-21. 3. Kimball 2002, pg. 16 4. Kimball 2002, pg. 310 5. "The Bottom-Up Misnomer". 2003-09-17. http://www.intelligententerprise.com/030917/615warehouse1_1.jhtml. Retrieved 2008-11-05. 6. Ericsson 2004, pp. 28-29 7. Yang, Jun. WareHouse Information Prototype at Stanford (WHIPS). [1]. Stanford University. July 7, 1998. 8. Caldeira, C. "Data Warehousing - Conceitos e Modelos". Edies Slabo. 2008. ISBN 978-972618-479-9 9. Pendse, Nigel and Bange, Carsten "The Missing Next Big Things", http://www.olapreport.com/Faileddozen.htm 10. "Gartner Reveals Five Business Intelligence Predictions for 2009 and Beyond", http://www.gartner.com/it/page.jsp?id=856714

======================================= SYSTEM LIFE CYCLE:


There are various stages in system life cycle. These stages are:1. Objectives and feasibility 2. System Analysis a. Review of documentation b. Observation of situation c. Conducting interviews d. Questionnaire administration 3. System Design ( Logical) a. Data flow diagram b. Data dictionary and data analysis c. Decisions table d. Decisions tree e. Structured English for Data Processing Analysis 4. System Design ( Physical) 5. Implementation 6. Maintenance

=========================================== QUESTIONS:
1. 2. 3. 4. 5. 6. 7. 8. 9.

What is MIS? What are different types of information flow in an organization? ( IITTM, PGDM9S), 2008) Describe how e-commerce is different from E-business? ( IITTM, PGDM9S), 2008) Describe three elements of decisions? ( IITTM, PGDM9S), 2008) Illustrate through clear diagram, the different outputs from a DSS. ( IITTM, PGDM9S), 2008) What are four important parts of an expert system? ( IITTM, PGDM9S), 2008) What is the different between a data warehouse and a data base? What features does phased development take from the traditional SDLC? How can a firm achieve strategic advantage from an MIS that processes customer sales

order? 10. How does a neural network work? ( IITTM, PGDM9S), 2008) 11. What EDI and why are companies using it? ( IITTM, PGDM9S), 2008) 12. Consider the ATM system installed by majority of banks all over the globe. How does it address your personal dimensions of time, location and form? Besides, just tracking what transactional you have completed using an ATM, what other information might your bank want to know and use concerning your use of the ATM system. ( IITTM, PGDM-S, III sem, 2008) 13. One of the best selling Pizzas is topped with cheese (both mozzarella and cheddar), mushroom, capsicum, tomato and onion. Very specific skilled chef is preparing this variety. When a customer requests a pizza with mozzarella cheese, tomato and garlic, the system breaks down. In this case, a special order has to be placed, and the customer needs to wait for at least 20 minutes. This waiting time dissatisfies many genuine customers. How would you change the system to accommodate this type of special order? ( IITTM, PGDM9S), 2008) 14. Categorize and explain the following decisions, taken by any typical manager in an industry, by the type of decision it represents. Choose from operational, tactical and strategic planning. a. Rejecting credit for a company with an overdue account. b. Analyzing sales by product line within each geographic region, this year to date versus last year to date. c. Using a simulation model to forecast profitability of a new product, using projected sales data, competitive industry statistics, and economic trends. i. Comparing planned versus actual expenses for departmental staff. ( IITTM, PGDM-S, III sem, 2008) 15. Allocating salespeoples time to the market prospects. ( IITTM, PGDM9S), 2008) 16. Define three phases of decision making. How these phases fit the following decisions. a. Apply to a university b. Decisions which three proposed, non-overlapping information systems projects to undertake, if you budget can only accommodate one of them. 17. In Nolan stage theory, why are slacks and the lack of effective planning and control systems useful during early phases of evolution? How can the stage throsy approach help MIS managers chart a course for future evolution? Also explain what types of organizational and management factors influence data processing evolution. 18. There are seven phases in the system development life cycle. Which one do you think is the hardest? Which one do you think is the easiest? Which one do you think is the most important? Which one do you think is least important? If you had to skip one of the phases, which one would it be why? What would happen to a systems development effort that decided to skip the testing phase? ( IITTM, PGDM-S, 2008) 19. You joined newly as a manager decisions support in the sales and marketing department of a company. You need to identify applications for the development of DSS, and explain one such possible application befit your job. In your computer, you found one information system that tracks maintenance Calls in office equipment supplied by your company. Do you think this system is worth labeled as a DSS? Do you think expert system can play a crucial role in your job, explain your answers. ( IITTM, PGDM-S, 2008) 20. Some experts claim that if a business gets 52 percent of its decisions right, it will be successful. Would using a DSS guarantee better results? Why or why not? What does the quality of any decisions depend on? Do you think it matters what type of decisions are included in this 52 percent? Explain your answer. ( IITTM, PGDM-S, 2008) 21. Describe the service provided by value-added network that make it easier for companies

to exchange EDI transactions with each other. What are the pros and cons of using valueadded network for B2B e-commerce? Why do not more companies sue the internet for EDI since it is much cheaper than using a value added network? ( IITTM, PGDM-S, 2008) 22. One response to privacy concerns raise by database marketing is the proposal that individuals should own data about themselves and should be able to sale the data to others. This leads to the idea of a consensual database, in which a customer might receive coupons, samples, or even money in exchange for yielding the rights to personal translation history. Identify some of the practical issues related to consensual databases and explain whether you believe that this form of marketing database could become widespread. ( IITTM, PGDM-S, III sem, 2008) 23. Discuss the role of MIS at various management levels. What characteristics would you see in an ideal MIS? 24. Discuss the use of internet and other developed medium of information technology for travel and tourism sector. 25. Discuss the value importance of information in todays business world. 26. Discuss the various modes through which information is generated. 27. Elaborate the role of computers in modern management system. 28. Describe different segments of computer hardware and computer software. 29. Give detailed information about local area network? 30. Describe application software and its uses. 31. What do you mean by information economics? 32. Discuss management of information resources and control systems. 33. Elaborate different methods of protecting information in computers. 34. Critically analyze the impact of computerization on job opportunities and on society.

CASE:
The computer in a Restaurant

The installation of minicomputer based information system has enabled KFC restaurant in Delhi to streamline their operations and promote tighter internal controls over their business. A waiter takes an order at a table, and then enters it online via one of the six terminals located in the restaurant dining room. The order is routed to a printer in the appropriate preparation area: the cold item printer if it is a salad, the hot item printer if it is a hot sandwich, or the bars printer if it is a drink. A customers meal check listing the items ordered and the respective prices is automatically generated. This ordering system eliminates the old three-carbon-copy guest check system as well as any problem caused by a waiters handwriting. When the kitchen runs out of food items, the cook send an out of stock message, which will be displayed on the dining room terminals when waiters try to order that item. This gives the waiters faster feedback enabling them to give better service to the customer.

Other system features aid management in the planning and control of their restaurant business. The system provides up-to-the-minute information on the food items ordered and break out percentage showing sales of each item versus total sales. The helps management plan menus according to customers taste. The system also compares the weekly sales totals versus food costs, allowing planning for tighter cost controls. In addition whenever an order is voided, the reason for the void is keyed in. this may help later in management decisions, especially if the voids are consistently related to food or service. Acceptance of the selection and by the user is exceptionally high since waiters and waitress were involved in the selection and dsign process. All potential users were asked to give their impress and ideas about the various systems available before one was chosen. Questions: 1. In managing the business of a restaurant, whet are some decision that must be made in the areas of: strategic plaiting managerial control -operation control 2. What information would you require from this system in order to aid in making such decision? 3. Compare to this system, most restaurant information systems are relatively systems are relatively information. Explain the probable effects that making the system formal would have on: -customers - Waiters -management ***

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