IM U-5 Notes
IM U-5 Notes
Role of information management in ERP, e-business, e-governance, Data Mining, Business Intelligence,
Pervasive Computing, Cloud computing, CMM.
Enterprise resource planning (ERP) is business management software usually a suite of integrated
applications that a company can use to collect, store, manage and interpret data from many business activities,
including: Product planning, cost ,Manufacturing or service delivery ,Marketing and sales, Inventory
management ,Shipping and payment
ERP provides an integrated view of core business processes, often in real-time, using common
databases maintained by a database management system.
ERP systems track business resources - cash, raw materials, production capacity and the status of
business commitments- orders, purchase orders, and payroll.
The applications that make up the system share data across the various departments
(manufacturing, purchasing, sales, accounting, etc.) that provide the data.
ERP facilitates information flow between all business functions, and manages connections to
outside stakeholders.
Functional areas
An ERP system covers the following common functional areas. In many ERP systems these are called and
grouped together as ERP modules:
Financial accounting: General ledger, fixed asset, payables including vouchering, matching and
payment, receivables cash application and collections, cash management, financial consolidation
Management accounting: Budgeting, costing, cost management, activity based costing
Human resources: Recruiting, training, fostering, payroll, benefits, 401K, diversity management,
retirement, separation
Manufacturing: Engineering, bill of materials, work orders, scheduling, capacity, workflow
management, quality control, manufacturing process, manufacturing projects, manufacturing flow,
product life cycle management
Order Processing: Order to cash, order entry, credit checking, pricing, available to promise, inventory,
shipping, sales analysis and reporting, sales commissioning.
Supply chain management: Supply chain planning, supplier scheduling, product configuration,order to
cash, purchasing, inventory, claim processing, warehousing (receiving, put away, picking and packing).
Project management: Project planning, resource planning, project costing, work breakdown structure,
billing, time and expense, performance units, activity management
Customer relationship management: Sales and marketing, commissions, service, customer contact,
call center support - CRM systems are not always considered part of ERP systems but rather Business
Support systems (BSS).
Data services : Various "self–service" interfaces for customers, suppliers and/or employees
Functional areas of ERP
COMPONENTS
Key features of ERP systems:
External access via
Transactional database technology such as web
comprehensive integrated business processes Management portal/dashboard services
modularity Business intelligence system Search
Customizable reporting Document management
central database
Resource planning and Messaging/chat/wiki
consistent look and feel across applications scheduling Workflow management
Analyzing the product
1.Business Integration: The reason why ERP packages are considered to be integrated, is the automatic data
updation(automatic data exchange among applications) that is possible among the related business components.
2.Flexibility: Different languages, currencies, accounting standards and so on can be covered in one system,
and functions that comprehensively manage multiple locations of a company packaged and implemented
automatically.
3.Better Analysis and Planning capabilities: By enabling the comprehensive and unified management of
related business and its data, it becomes possible to fully utilize many types of DSS and simulation functions.
4.Use of Latest Technology: ERP vendors were very quick to realize that in order to grow and to sustain that
growth; they had to embrace the latest developments in the field of IT. So, they quickly adapt their systems to
take advantage of the latest technologies like Open systems, client/server technology, Internet/Intranet,
CALS(Computer Aided Acquisition and Logistics Support), e- commerce, etc.
FEATURES/CHARACTERISTICS OF ERP:
inventory reduction
material cost reductions
labor cost reductions
1. Need Assessment: First and foremost the company’s needs are to be identified properly. The process begins
with searching and documenting important business processes, inflection points and KPI, i.e. Key performance
indicators so as to outline perfect ERP solutions.
2. Hire a team of specialists: Next, in the process of implementation, experience professionals or experts are
hired or contracted so as to direct the organization through the implementation process.
3. ERP system evaluation and selection: The choice of right ERP software is the most difficult task in the entire
process, which depends on various factors like business needs, industry type, preferences and so on.
4. Prepare for Change: Implementation of ERP throughout the organization is one of the biggest change, and that
too when the company is not used to such system. So, make sure that the management, staff and other members
are ready for such a change.
5. Data Preparation: All the data cannot be converted into the new system. So analysis data should be analyzed
and ascertain the pieces of data which are required to be converted. Once the data is entered in the system, it
should be cleaned up properly.
6. ERP Implementation: Once all the above steps are performed properly, then the ERP system is introduced.
The ERP specialists design a particular plan for installing, configuring and optimizing the system for the
working environment. Plans can be changed if required so the major business objectives and needs should be
given preference.
7. Testing: After implementation process is completed, testing is to be done, so as to ensure that work is
performed in an intended way.
8. Training & Education: When the system is properly launched in the organization and verified, the next step is
to train and educate the employees regarding how to use the program.
9. Go Live: Finally, when the system is configured, tested and employees are trained, then ERP program is
activated.
10. Ongoing Support: Continuous support about upgradation and maintenance is available to the customers, by the
manufacturers, for better working.
The ERP software is used by the firms to make optimum use of enterprise’s resources and maximize the
economy, efficiency and effectiveness of the operations.
The selection of ERP system is one of the toughest decision for managers, which is based on a number of
factors like functional requirements of the organization, background of vendors, budget constraints and fund
position and reports available in the package
ERP Implementation Phases
project team +implementation team Configure the system based on After successful integration of new
provide efficient structure to execute user feedback and test outcomes. system into business
Define the implementation
structure Scan the system and find out Measure business productivity
Allocate the user role and the gaps and revenue
responsibility Get feedback from the users Ensure post-implementation
Document the working procedure Fine-tuning the configuration activities
Create an agenda with deadlines Getting continuous updates
and budget from the users
Upgrade the system with the
relevant changes
E-BUSINESS
Electronic Business (e-Business), derived from such terms as "e-mail" and "e-commerce," is the conduct
of business electronically, typically over the Internet, not only buying and selling, but also servicing customers
and collaborating with business partners.
The use of Internet Technologies to work and empower business processes, electronic commerce
and enterprise collaboration within a company and with its customers, suppliers and other business
stakeholders.
E-Business=E-Marketing + E-Commerce + E-Operations
The way in which you manage your business relationships has not changed, but the way they are
referred to when using e-Business tools has. They are becoming more often known as:
Business to Business (B2B)
Business to Consumer (B2C) (also known as e-Commerce)
Government to Consumer (G2C)
Government to Business (G2B).
e-Business tools
mobile phones
personal digital assistants (PDAs)
electronic data interchange
file transfer Applications of E – Business
facsimile(an exact copy, written or printed material) Electronic banking
Video conferencing, Internet, intranets and extranets. Electronic trading
E – learning
E-Business Framework:
Employment and placement and job market.
Business partners
E – tailing
Employees
Electronic auctions
Supply Chain Management
Enterprise Resource Planning(ERP)
Characteristics of E-business
Customer Relationship Management(CRM)
Collaborative product development
E-Procurement
Collaborative planning, forecasting and replenishment
Selling chain Management
Procurement and order management
Operations and logistics
e-Business in business
E-Business is more than having a website for your business. Using e-Business tools can make your
administrative and operational activities more efficient through:
accessing the Internet to source information about your industry, suppliers and products and for general
research
the use of electronic transaction, for example online banking, financial management, stock control and
compliance reporting to regulatory bodies such as the Australian Taxation Office
purchasing and selling without a web presence by using email or e-fax
human resources management, through the development of an intranet for news, policies, staff
movements and enabling staff to apply for leave and access their personnel information online
customer relationship management, which integrates front and back office functions of an organisation
through electronic capabilities
Using appropriate project management software.
People do not trust, paperless, faceless less expensive products and services
transactions. Anytime and Anywhere Shopping
Perception that EC is expensive Relevant and detailed information in seconds
unsecured. customized product
Unresolved legal issues( for quality, security and
reliability) To society:-
E-Governance
E-governance is the application of information and communication technology (ICT) for delivering
government services, exchange of information communication transactions, integration of various stand-alone
systems and services between government-to-customer (G2C), government-to-business (G2B), government-to-
government (G2G) as well as back office processes and interactions within the entire government framework.
Through e-governance, government services will be made available to citizens in a convenient, efficient
and transparent manner. The three main target groups that can be distinguished in governance concepts are
government, citizens and businesses/interest groups. In e-governance there are no distinct boundaries.
Four basic models of E-Governance:
1.Government-to-Citizen(customer)[G2C]
2.Government-to-Employees[G2E]
3.Government-to-Government[G2G]
4.Government-to-Business[G2B]
E-Governance refers to the development and enforcement of the policies, laws and regulations
necessary to support the functioning of governmental units
E-Government refers to the use of information technologies by government agencies.
Government-to-Citizen(G2C)
refers to the government services that are accessed by the familiar people.
the primary goal of Government-to-citizen is to provide facilities to the citizen.
helps people to reduce the time and cost to conduct a transaction.
A citizen can have access to the services anytime from anywhere.
Many services like license renewals, and paying tax are essential in G2C.
It also includes Online registration for Birth/Marriage/Death Certificates
spending the administrative fee online is also possible due to G2C.
G2C enables the ordinary citizen to overcome time limitation.
It also focuses on geographic land barriers. Eg.: india.gov.in
2. Government-to-business (G2B)
Refers to the exchange of services between Government and Business organizations.
It is efficient for both government and business organizations.
G2B provides Timely business information.
business organization can have easy and convenient online access to government agencies.
G2B plays a crucial role in business development.
It enhances the efficiency and quality of communication and transparency of government projects.
Eg.: KHAJANE (Karnataka): End-to-end automation of Government Treasury System
3. Government-to-Government (G2G)
Refers to the interaction between different government department, organizations, and agencies.
This increases the efficiency of government processes and government departments can work together.
Here, the government agencies can share the same database using online communication.
This service can increase international diplomacy and relations.
G2G services can be at the local level or the international level.
It can communicate with global government and local government as well.
It provides safe and secure inter-relationship between domestic or foreign government. E-Governance
G2G constructs a universal database for all member states to enhance service. Model
4. Government-to-Employee (G2E)
The Government-to-Employee is the internal part of G2G sector.
G2E aims to bring employees together and improvise knowledge sharing.
G2E provides online facilities to the employees like applying for leave, reviewing salary payment record
and checking the balance of holiday.
The G2E sector provides human resource training and development.
G2E is also the relationship between employees, government institutions, and their management.
Domains of E - Governance Advantages of E-Governance
E- administration: Improving process Integration of various ministers and departments
E- citizens and E- services: connecting citizens. Documentation, monitoring, and control of various
E – society : building external interactions projects
Geographic information based system
Disadvantages of E-Governance Crime control and management
Loss of Interpersonal Communication Welfare projects
High Setup Cost and Technical Difficulties Revenue generation
Illiteracy Birth and Death monitoring and control
Cybercrime/Leakage of Personal Information Citizen Identification system
Speed, Cost Savings, Transparency, Accountability
DATA MINING
b)Rule Induction: Rule induction is a data mining process of deducing if-then rules from a data set.
Rule is created for each path from the root to a leaf. Each attribute-value pair along a path forms a
Conjunction: the leaf holds a class of prediction.
3.Neural networks: Unique ability to derive meaning from complicated or imprecise data and can be used to
extract patterns and detect trends that are too complicated to be noticed by either humans and other computer
techniques.
Neural Networks in Data Mining
4. OLAP (Online Analytical Processing): OLAP is a category of software that allows users to analyze
information from multiple database systems at the same time. It is a technology that enables analysts to extract
and view business data from different points of view.
OLAP databases are divided into one or more cubes for very quick data analysis. The cube can store and
analyze multidimensional data in a logical and orderly manner.
OLAP Operations
DIFFERENCE BETWEEN DATA MINING & OLAP
5.Data visualization: Make it possible for analyst to gain a deeper, more institutive understanding
The main goal of data visualization is to make it easier to identify patterns, trends and outliers in
large data sets where the information is transformed into a visual context, such as maps, graphs, table, charts
,Box plots ,Histograms, Heat maps or Tree maps
CRISP – DM (Cross – Industry Standard Process for Data Mining) is a data mining process model that
describes commonly used approaches that expert data miners use to tackle problems. It is the leading
methodology used by data miners. CRISP – data mining model are developed by a consortium of several
companies.
Six phases of CRISP - DM
Phase 1: Business understanding
Phase 2: Data understanding
Phase 3: Data preparation
Phase 4: Modeling
Phase 5: Evaluation
Phase 6: Deployment
1.Business Understanding
This initial phase focuses on understanding the
project objectives and requirements from a business
perspective, and then converting this knowledge into a
data mining problem definition, and a preliminary plan
designed to achieve the objectives.
2.Data Understanding
6.Deployment The data understanding phase starts with an initial
Depending on the requirements, the deployment phase data collection and proceeds with activities in order to
can be as simple as generating a report or as complex as get familiar with the data, to identify data quality
implementing a repeatable data mining process. problems, to discover first insights into the data, or to
detect interesting subsets to form hypotheses for hidden
5.Evaluation information.
Before deployment of the model, it is important
to more thoroughly evaluate the model, and review the
steps executed to construct the model, to be certain it 3.Data Preparation
properly achieves the business objectives. At the end , a The data preparation phase covers all activities to
decision on the use of the data mining results should be construct the final dataset (data that will be fed into the
reached. modeling tool(s)) from the initial raw data. Tasks
include table, record, and attribute selection as well as
transformation and cleaning of data for modeling tools.
4.Modeling
In this phase, various modeling techniques are
selected and applied, and their parameters are
calibrated to optimal values. Typically, there are
several techniques for the same data mining problem
type. Therefore, stepping back to the data preparation
phase is often needed.
BUSINESS INTELLIGENCE
The term Business Intelligence(BI) represents the tools and system that play a key role in the strategic
planning process of the corporation.
These systems allow a company to gather, store, access and analyze corporate data from multiple
sources to aid in decision making with the intention of improving the performance of the organization by means
of advanced analytics and reporting.
Business intelligence (BI) is the set of techniques and tools for the transformation of raw data into
meaningful and useful information for business analysis purposes.
BI technologies are capable of handling large amount of data to provide historical, current and
predictive views of business operations.
Business intelligence models are based on multi dimensional analysis and key performance indicators
(KPI) of an enterprise. Key performance Indicators [KPI]:
BI Architectural Components: Are quantifiable measurements
1. General: year to year measurements
2. Finance: EPS, profit margin, etc.
3. HR: applicants to job opening,
employee turnover ratio, etc.
4. Education: graduation rates, no. of
incoming, student retention rates, etc.
Components of BI :
1. Data extraction, transformation and
loading tools
2. Data store
3. Data query and analysis tools
4. Data presentation and visualization
tools
The business intelligence architecture is composed of data, people, processes, technology, and the management
of those components
1. ETL tools − Data extraction, transformation, and loading (ETL) tools collect, filter, integrate, and
aggregate operational data to be saved into a data store optimized for decision support.
2. Data Store − The data store is optimized for decision support and is generally represented by a data
warehouse or a data mart.
The data store contains two main types of data: business data and business model data.
The business data are extracted from the operational database and from external data sources.
The business data is stored in structures that are optimized for data analysis and query speed.
The external data sources provide data that cannot be found within the company but that are
relevant to the business, such as stock prices, market indicators, marketing information, and
competitors data.
Business models are generated by special algorithms that model the business to identify and
enhance the understanding of business situations and problems.
3. Data query and analysis tools − This component performs data retrieval, data analysis & data-mining
tasks using the data in the data store. This component is used by the data analyst to create the queries
that access the database. Depending on the implementation, the query tool accesses either the
operational database, or more commonly, the data store. This tool advises the user on which data to
select and how to build a reliable business data model. This component is generally represented in the
form of an OLAP1 tool.
4. Data presentation and visualization tools − this component is in charge of presenting the data to the
end user in a variety of ways. This component is used by the data analyst to organize and present the
data. This tool helps the end user select the most appropriate presentation format, such as summary
report, map, pie or bar graph, or mixed graphs. The query tool and the presentation tool are the front end
to the BI environment.
BUSINESS INTELLIGENCE (BI) tools are software that collects, transforms, presents data to help
decision-makers drive business growth. BI tools ingest large amounts of structured and unstructured data from
varied sources, transform it and help deduce actionable business insights from the data
Some of the major tool types used in many modern BI suites: enterprise reporting, dashboards, online
analytical processing (OLAP), Visualizations, real-time analysis, analytics, data mining, process mining, ETL,
complex event processing, business performance management, benchmarking, text mining, cloud BI, embedded
BI, open-source BI, predictive analytics, prescriptive analytics, self-service BI, etc.
All of these tools present data in a usable way for decision makers.
Eg.: SAP BI, Grow, Zoho Analytics, Microsoft Power BI, Microsoft BI, Google Charts, etc.
Main issues that Business Intelligence can help Success factors of implementation
you solve According to Kimball et al., there are three critical areas
that organizations should assess before getting ready to do
Poor Performance Management
a BI project:
Slow Market Response
1. The level of commitment and sponsorship of the
Losing Customers project from senior management
Chaos in Day-to-Day Operations 2. The level of business need for creating a BI
Wasting Time on Compiling Multiple Systems Instead implementation
of Analyzing Data 3. The amount and quality of business data available.
Reliance on Tech Teams to Develop Custom Reports.
Limited Access to Data.
BI Portal:
A Business Intelligence portal (BI portal) is the primary access interface for Data Warehouse (DW) and Business
Intelligence (BI) applications. It’s main functionality is to provide a navigation system of the DW/BI application
(i.e.) the user has access to all the functions of the DW/BI application.
Balanced scorecard(BSC)
It is a strategic planning and management system that organizations use to: Communicate what they are
trying to accomplish. Align the day-to-day work that everyone is doing with strategy. Prioritize projects,
products, and services. Measure and monitor progress towards strategic targets.
Pervasive computing is the growing trend of embedding microprocessors into everyday objects to
effectively communicate information and perform useful tasks. Pervasive computing devices are network-
connected and constantly available.
Eg.: An Apple Watch that alerts the user to a phone call and allows the call to be completed through the watch.
It has many potential applications from health and home care to environmental monitoring and
intelligent transport systems.
CLOUD COMPUTING
Cloud computing is a type of computing that relies on sharing computing resources rather than local
servers or personal device to handle applications
The word cloud is used as the metaphor for “the Internet”.
(OR)
Cloud computing is computing in which large groups of remote servers are networked to allow the
centralized data storage, and online access to computer services or resources.
Cloud computing providers offer their services according to several fundamental models:
Software as a Service (SaaS)-End Users
Platform as a Service (PaaS)-Application Developers
Infrastructure as a Service (IaaS)-Network Architects
End-User
Application (OR)
Developers
Network
Architects
Cloud Service Layers - Characteristics Types of Cloud computing / Cloud Deployment Models
Software as a Service (SaaS)
Sometimes free;
easy to use;
good consumer adoption;
proven business models
You can only use the application as far
as what it is designed for
Platform as a Service (PaaS) 1)Public cloud: It is a computing services owned, operated and
Developers can upload a configured offered by third-party providers which is an open system where
applications and it “runs” within the storage or software are available for free or pay per usage model
platform’s framework; that can be accessed via public Internet.
E.g.: Amazon Elastic Cloud Compute(EC2), Google App Engine,
Restricted to the platform’s ability only;
Blue Cloud by IBM and Windows Azure.
sometimes dependant on Cloud
2)Private cloud: These are built exclusively for a single
Infrastructure provider
enterprise. It is more expensive and more secure when compare to
Infrastructure as a Service (IaaS)
public cloud. E.g.: HP data center, IBM, Sun, Oracle, 3tera.
Offers full control of a company’s
Two variants are
infrastructure;
i)On-Premise Private cloud: Known as internal clouds which is
not confined to applications or restrictive
hosted within one’s own data centre. Best suited for applications
instances
that require complete control and configurability of infrastructure
Sometimes comes with a price premium;
and security
can be complex to build, manage and ii)Externally Hosted Private cloud: Hosted externally with a
maintain cloud provider with full guarantee of privacy. Best suited for
enterprises that do not prefer public cloud to sharing of physical
resources.
3)Hybrid cloud: Combine of both public and private cloud.
Organizations may host critical applications on private clouds
whereas relatively less security concerns on public cloud.
) Advantages of Cloud computing: Disadvantages of Cloud Computing:
Reduced cost Data protection is based on service providers
Increased storage and scalability Data Recovery and availability
Flexibility Management capabilities
Regulatory and compliance restrictions
Cloud computing is impossible if you cannot
connect to the Internet .
CMM provides the means to measure an organizations process maturity against a set of common feature
that are specified at each of the maturity levels.
In November 1986, the American Software Engineering Institute (SEI) in cooperation with Mitre
Corporation created the Capability Maturity Model for Software. CMM was developed and is promoted by
the SEI, a research and development center sponsored by the U.S. Department of Defense (DoD).
Many companies had been completing their projects with significant overruns in schedule and budget.
The development and application of CMM helps to solve this problem. The key concept of the standard is
organizational maturity.
A mature organization has clearly defined procedures for software development and project
management. These procedures are adjusted and perfected as required.
In any software development company there are standards for processes of development, testing, and
software application; and rules for appearance of final program code, components, interfaces, etc.
CMM – STRUCTURE
LEVELS OF CMM:
There are five levels defined along the continuum of the CMM, and, according to the SEI:
Level 1 - Initial (chaotic, ad hoc,)- the starting point for use of a new process.
Level 2 - Repeatable- the process is managed according to the metrics described in the Defined stage.
Level 3 - Defined - the process is defined/confirmed as a standard business process,
Level 4 - Quantitatively managed.
Level 5 - Optimized - process management includes deliberate process optimization/improvement.
Disadvantages:
Only provides a
snapshot
Does not reflect current
business or cultural
dynamics and process
operational issues
If the assessment
process is outsourced
can be vendor or
framework dependent
If this is the case, it is
difficult to compare to
industry standards
Subject to the opinion
of assessors