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Ebook Management information systems (10th edition): Part 2

(BQ) Part 2 book "Management information systems" has contents: Enterprise business systems, commerce systems, supporting decision making, business systems, security and ethical challenges; enterprise and global management of information technology,.and other contents. | obr76817_ch08_307-348.indd Page 320 8/13/10 2:58 PM user-f494 320 ● /Volumes/203/MHBR178/sLa1719X_disk1of1/007731719X/sLa1719X_pagefiles Module III / Business Applications SECTION II Introduction Enterprise Resource Planning: The Business Backbone What do Microsoft, Coca-Cola, Cisco, Eli Lilly, Alcoa, and Nokia have in common? Unlike most businesses, which operate on 25-year-old back-office systems, these market leaders reengineered their businesses to run at breakneck speed by implementing a transactional backbone called enterprise resource planning (ERP). These companies credit their ERP systems with having helped them reduce inventories, shorten cycle times, lower costs, and improve overall operations. Businesses of all kinds have now implemented enterprise resource planning (ERP) systems. ERP serves as a cross-functional enterprise backbone that integrates and automates many internal business processes and information systems within the manufacturing, logistics, distribution, accounting, finance, and human resource functions of a company. Large companies throughout the world began to install ERP systems in the 1990s as a conceptual framework and catalyst for reengineering their business processes. ERP also served as the vital software engine needed to integrate and accomplish the crossfunctional processes that resulted. Now, ERP is recognized as a necessary ingredient that many companies need in order to gain the efficiency, agility, and responsiveness required to succeed in today’s dynamic business environment. See Figure 8.7. Read the Real World Case on the next page. We can learn a lot about some of the challenges faced by ERP adopters from this case. What Is ERP? ERP is the technological backbone of e-business, an enterprisewide transaction framework with links into sales order processing, inventory management and control, production and distribution planning, and finance. Enterprise resource planning is a cross-functional enterprise system driven