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Chapter 11
Enterprise Applications and Business Process Integration
11-1
Chapter 11
Enterprise Applications and Business Process Integration
True-False Questions
1.
Enterprise software allows data to be used by multiple functions and business processes for
precise organizational coordination and control.
Answer: True
2.
Reference: p. 383
Difficulty: Medium
Reference: p. 383
Difficulty: Easy
Reference: p. 384
Difficulty: Medium
Reference: p. 386
Supply chains in large manufacturing companies are multitiered.
Answer: True
9.
Difficulty: Medium
The upstream portion of the supply chain consists of the organizations and processes for
distributing and delivering products to the final customers.
Answer: False
8.
Reference: p. 383
Enterprise systems can improve management reporting and decision making.
Answer: True
7.
Difficulty: Medium
When doing business worldwide, enterprise-enabled organizations use enterprise systems to
emphasize functional boundaries and deemphasize cross-functional coordination.
Answer: False
6.
Reference: p. 381
Enterprise systems use a client/server architecture and have not yet been redesigned to take
advantage of the Web.
Answer: False
5.
Difficulty: Hard
Major enterprise software vendors include SAP, Oracle, PeopleSoft, and Baan.
Answer: True
4.
Reference: p. 380
Companies can use state transition diagrams provided by the enterprise software to tailor a
particular aspect of the system to the way it does business.
Answer: False
3.
Difficulty: Easy
Difficulty: Medium
Reference: p. 387
The Supply Chain Council developed a Supply Chain Operations Reference Model as a process reference model for supply chain management for the transportation industry.
Answer: False
Difficulty: Medium
Reference: p. 386
11-2
Enterprise Application and Business Process Integration
10.
SCOR identifies five major supply chain processes: organize, research, plan, deliver, and
return.
Answer: False
11.
Difficulty: Medium
Reference: p. 387
Difficulty: Hard
Reference: p. 388
Difficulty: Easy
Reference: p. 389
Difficulty: Medium
Reference: p. 389
Difficulty: Easy
Reference: p. 389
Intranets can be used to integrate information from isolated business processes within the
firm to help them manage their internal supply chains.
Answer: True
20.
Reference: p. 387
In the pre-Internet environment, supply chain coordination was hampered by the difficulties
of making information flow smoothly among different internal supply chain processes.
Answer: True
19.
Difficulty: Medium
Throughput is the total elapsed time to complete a business process.
Answer: False
18.
Reference: p. 387
A metric is a standard measurement of performance.
Answer: True
17.
Difficulty: Medium
Supply chain execution systems enable the firm to generate demand forecasts for a product
and to develop sourcing and manufacturing plans for that product.
Answer: False
16.
Reference: p. 387
Ripple effect is the distortion of information about the demand for a product as it passes from
one entity to the next across the supply chain.
Answer: False
15.
Difficulty: Medium
Low inventory acts a buffer for the lack of flexibility in the supply chain.
Answer: False
14.
Reference: p. 386
Supply chain inefficiencies can waste as much as 25 percent of a company’s operating costs.
Answer: True
13.
Difficulty: Medium
Logistics accounts for 12 to 14 percent of a typical manufacturer’s cost of goods sold.
Answer: True
12.
Chapter 11
Difficulty: Easy
Reference: p. 390
The Internet provides a standard set of tools that can be used by companies all over the world
to coordinate overseas sourcing, transportation, communications, financing, and compliance
with customs regulations.
Answer: True
Difficulty: Medium
Reference: p. 391
Chapter 11
21.
Enterprise Applications and Business Process Integration
In a push-based model, actual customer orders or purchases trigger events in the supply
chain.
Answer: False
22.
Reference: p. 393
Difficulty: Hard
Reference: p. 393
Difficulty: Easy
Reference: p. 395
Difficulty: Easy
Reference: p. 394
Difficulty: Easy
Reference: p. 395
Siebel Systems is the market-leading vendor of customer relationship management software.
Answer: True
30.
Difficulty: Hard
Bundling is one kind of cross-selling in which a combination of products is sold as a bundle
at a price higher than the total cost of the individual products..
Answer: False
29.
Reference: p. 392
Major CRM application software vendors include Siebel Systems, Clarify, and
Salesforce.com.
Answer: True
28.
Difficulty: Medium
Cross-selling markets complementary products to customers.
Answer: True
27.
Reference: p. 391
Customer relationship management can help organizations identify customers who cost a lot
to attract and to keep.
Answer: True
26.
Difficulty: Medium
Total supply chain costs represent the majority of operating expenses for many businesses
and in some industries approach 75 percent of the total operating budget.
Answer: True
25.
Reference: p. 391
Dell Computers is an example of a push-based model.
Answer: False
24.
Difficulty: Medium
In a pull-based model, production master schedules are based on forecasts of demand for
products.
Answer: False
23.
11-3
Difficulty: Easy
Reference: p. 395
Single-channel customers are known to have a higher lifetime value than multichannel
customers.
Answer: False
Difficulty: Medium
Reference: p. 397
11-4
Enterprise Application and Business Process Integration
31.
Analytical CRM uses a customer data warehouse and tools to analyze customer data
collected from the firm’s customer touch points and from other sources.
Answer: True
32.
Difficulty: Medium
Reference: p. 398
When building an enterprise system, the benefits are easily quantified at the beginning of the
project.
Answer: False
33.
Chapter 11
Difficulty: Easy
Reference: p. 399
SAPs mySAP and Oracle’s e-Business Suite are both examples of software vendors that have
developed Web-enabled software for enterprise solutions.
Answer: True
Difficulty: Easy
Reference: p. 399
34. ` A service such as order-to-cash requires data from enterprise applications and financial
systems to be further integrated into an enterprise-wide composite process.
Answer: True
35.
Reference: p. 403
Difficulty: Medium
Reference: p. 405
Difficulty: Medium
Reference: p. 405
Enterprise systems require changes in business processes, organizational structure, and
organizational culture.
Answer: True
40.
Difficulty: Medium
Primary advantages of enterprise systems include their ease of implementation and
flexibility.
Answer: False
39.
Reference: p. 401
One of the challenges associated with enterprise systems is realizing strategic value.
Answer: True
38.
Difficulty: Hard
The costs of enterprise systems are moderate compared to the benefits they achieve, are not
noticeable, and often incur political support.
Answer: False
37.
Reference: p. 401
SAP’s version of cross-application services is called XRP.
Answer: False
36.
Difficulty: Medium
Difficulty: Medium
Reference: p. 406
Many firms embracing CRM underestimate the extent to which every facet of the enterprise
must be involved and integrated into the customer relationship.
Answer: True
Difficulty: Medium
Reference: p. 403
Chapter 11
Enterprise Applications and Business Process Integration
11-5
Multiple-Choice Questions
41.
A set of integrated software modules for finance and accounting, human resources,
manufacturing and production, and sales and marketing that allows data to be used by
multiple functions and business processes best describes:
a.
b.
c.
d.
process management software .
enterprise software.
collaboration software.
application software.
Answer: b
42.
groupware.
application software.
collaboration software.
enterprise software.
Answer: d
Difficulty: Medium
Reference: p. 380
This software is built around thousands of predefined business processes:
a.
b.
c.
d.
process management software
collaboration software.
enterprise software.
groupware software.
Answer: c
44.
Reference: p. 380
This type of software enables data to be used by multiple functions and business processes
for precise organization coordination and control:
a.
b.
c.
d.
43.
Difficulty: Medium
Difficulty: Medium
Reference: p. 381
Process maps or reference models provided by enterprise software vendors are based on
business process knowledge and:
a.
b.
c.
d.
cross-selling.
best practices.
metrics.
push-models.
Answer: b
Difficulty: Medium
Reference: p. 381
11-6
Enterprise Application and Business Process Integration
45.
The most successful solutions or problem-solving methods for consistently and effectively
achieving a business objective best describes:
a.
b.
c.
d.
business module.
formal system.
business process.
best practices.
Answer: d
46.
Difficulty: Medium
Reference: p. 381
Nestlé SA, installed a ______________________ enterprise system as a way of
standardizing and coordinating its business processes in 500 facilities in 80 countries.
a.
b.
c.
d.
SAP R/3
Oracle
Baan
PeopleSoft
Answer: a
Difficulty: Hard
Reference: p. 384
A network of organizations and business processes for procuring raw materials, transforming
these materials into intermediate and finished products, and distributing the finished products
to customers is called a:
a.
b.
c.
d.
distribution channel.
supply chain.
value chain.
marketing chain.
Answer: b
49.
Reference: p. 381
configuration tables.
project workbooks.
data dictionaries.
state transition diagrams.
Answer: a
48.
Difficulty: Medium
When tailoring a particular aspect of a system to the way a company does business,
enterprise software can provide the company with:
a.
b.
c.
d.
47.
Chapter 11
Difficulty: Medium
Reference: p. 385
The Supply Chain Council developed a cross-industry process reference model for supply
chain management called:
a.
b.
c.
d.
SCOR.
SCCM.
TCP/IP.
MRP.
Answer: a
Difficulty: Hard
Reference: p. 386
Chapter 11
50.
Enterprise Applications and Business Process Integration
11-7
According to SCOR, the source process:
a. consists of processes associated with returning products or receiving returned products,
including postdelivery customer support.
b. consists of processes that provide finished goods and services to meet actual or planned
demand, including order management, transportation management, and distribution
management.
c. consists of processes that transform a product into a finished state to meet planned or
actual demand.
d. consists of processes that procure goods and services needed to create a specific product
or service.
Answer: d
51.
acquisition.
research and development.
logistics.
procurement.
Answer: c
Difficulty: Medium
Reference: p. 387
A scheduling system for minimizing inventory by having components arrive exactly at the
moment they are needed and finished goods shipped as soon as they leave the assembly line
best describes:
a.
b.
c.
d.
just-in-time.
stockless inventory.
ASAP inventory.
replenishment-only inventory.
Answer: a
53.
Reference: p. 386
Planning and control of all factors that will have an impact on transporting a product or
service best defines:
a.
b.
c.
d.
52.
Difficulty: Medium
Difficulty: Medium
Reference: p. 387
A distortion of information about the demand for a product as it passes from one entity to the
next across the supply chain is called:
a.
b.
c.
d.
bullwhip effect.
ripple effect.
replenishment effect.
exponential effect.
Answer: a
Difficulty: Medium
Reference: p. 387
11-8
Enterprise Application and Business Process Integration
54.
Supply chain software can be classified as:
a.
b.
c.
d.
supply chain source systems and supply chain recovery systems.
supply chain make systems and supply chain delivery systems.
supply chain return systems and supply chain make systems.
supply chain planning systems and supply chain execution systems.
Answer: d
55.
Difficulty: Medium
Reference: p. 388
Supply chain planning systems:
a.
b.
c.
d.
track the physical status of goods.
identify the transportation mode to use for product delivery.
track the financial information involving all parties.
track the status of orders
Answer: b
56.
Chapter 11
Difficulty: Hard
Reference: p. 389
Supply chain execution systems:
a. schedule product subassemblies
b. help the company determine how much of a specific product to manufacture in a given
time period.
c. enable the firm to generate demand forecasts for a product.
d. develop sourcing and manufacturing plans to determine how much of a specific product
to manufacture in a given time period.
Answer: a
57.
Reference: p. 389
Systems that enable a firm to generate demand forecasts for a product and to develop
sourcing and manufacturing plans for that product best describes:
a.
b.
c.
d.
supply chain demand systems.
supply chain delivery systems.
supply chain planning systems.
supply chain execution systems.
Answer: c
58.
Difficulty: Hard
Difficulty: Medium
Reference: p. 388
Systems to manage the flow of products through distribution centers and warehouses to
ensure that products are delivered to the right locations in the most efficient manner best
describes:
a.
b.
c.
d.
supply chain demand systems.
supply chain delivery systems.
supply chain planning systems.
supply chain execution systems.
Answer: d
Difficulty: Medium
Reference: p. 389
Chapter 11
59.
Enterprise Applications and Business Process Integration
Capabilities of supply chain planning systems would not include:
a.
b.
c.
d.
replenishment.
advanced scheduling and manufacturing planning.
demand planning.
order planning.
Answer: a
60.
Difficulty: Medium
Reference: p. 389
Which of the following is NOT for measuring supply chain performance:
a.
b.
c.
d.
Delta-normal.
fill rate.
cycle time for sourcing.
forecast accuracy.
Answer: a
Difficulty: Medium
Reference: p. 389
A standard set of tools that can be used by companies all over the world to coordinate
overseas sourcing, transportation, communications, financing, and compliance with customs
regulations would be:
a.
b.
c.
d.
the Internet.
an intranet.
an extranet.
WAN.
Answer: a
63.
Reference: p. 390
metric.
component cycle.
MIPS.
cycle.
Answer: a
62.
Difficulty: Medium
A standard measurement of performance best describes:
a.
b.
c.
d.
61.
11-9
Difficulty: Easy
Reference: p. 391
A supply chain driven by actual customer orders or purchases so that members of the supply
chain produce and deliver only what customers have ordered best describes:
a.
b.
c.
d.
pull-based model.
innovation-based model.
push-based model.
replenishment-based model.
Answer: a
Difficulty: Medium
Reference: p. 391
11-10
64.
Enterprise Application and Business Process Integration
Companies with effective supply chain management systems can expect:
a.
b.
c.
d.
improved customer service and responsiveness.
cost reduction.
cash utilization.
All of the above
Answer: d
65.
Difficulty: Easy
Reference: p. 393
It is estimated that it can cost up to ____________________ times as much to acquire a new
customer as to keep an old customer.
a.
b.
c.
d.
five
six
eight
ten
Answer: b
Difficulty: Easy
Reference: p. 394
A method of firm interaction with a customer, such as telephone, e-mail, customer service
desk, conventional mail, or point of purchase best describes:
a.
b.
c.
d.
point of presence.
touch point.
market entry.
channel point.
Answer: b
68.
Reference: p. 393
45 to 55
55 to 65
50 to 80
80 to 90
Answer: d
67.
Difficulty: Easy
“Good” customers represent about ___________________ percent of the company’s profits
but they represent only 10 to 20 percent of the company’s customer base.
a.
b.
c.
d.
66.
Chapter 11
Difficulty: Medium
Reference: p. 394
Which of the following deals with employee issues that are closely related to CRM, such as
setting objectives, employee performance management, performance-based compensation,
and employee training?
a.
b.
c.
d.
Enterprise systems software
Employee relationship management software
Supply chain management software
Customer relationship management software
Answer: b
Difficulty: Easy
Reference: p. 394
Chapter 11
69.
Enterprise Applications and Business Process Integration
Cross-selling in which a combination of products is sold as a bundle at a price lower than the
total cost of the individual products best describes:
a.
b.
c.
d.
collaborative marketing.
up-selling.
discount selling.
bundling.
Answer: d
70.
Difficulty: Easy
Reference: p. 395
This company is the market-leading vendor of customer relationship management software:
a.
b.
c.
d.
IBM.
Microsoft.
Siebel Systems.
J. D. Edwards.
Answer: c
Difficulty: Easy
Reference: p. 395
Verizon sells telephone services that include local and long-distance service, voice mail
service, caller identification, and digital subscriber line access to the Internet. This is a form
of:
a.
b.
c.
d.
up-selling.
bundling.
customer relationship management.
cross-marketing
Answer: b
73.
Reference: p. 395
cross over selling.
up-selling.
discount selling.
bundling.
Answer: b
72.
Difficulty: Easy
The marketing of elevated-value products or services to new or existing customers is referred
to as:
a.
b.
c.
d.
71.
11-11
Difficulty: Easy
Reference: p. 395
Customer relationship management applications dealing with the analysis of customer data to
provide information for improving business performance best describes:
a.
b.
c.
d.
operational customer relationship management applications.
analytical customer relationship management applications.
supply chain management applications.
generic customer relationship management applications.
Answer: b
Difficulty: Medium
Reference: p. 397
11-12
74.
Enterprise Application and Business Process Integration
Measurement of the number of customers who stop using or purchasing products or services
from a company; it is used as an indicator of the growth or decline of a firm’s customer base
best describes:
a.
b.
c.
d.
e.
turnover rate.
churn rate.
decline rate.
asset turns.
fill rate.
Answer: b
75.
Reference: p. 398
cross-selling.
operational CRM.
analytical CRM.
bundling.
Answer: c
Difficulty: Medium
Reference: p. 398
This metric is based on the relationship between the revenue produced by a specific
customer, the expenses incurred in acquiring and servicing that customer, and the expected
live of the relationship between the customer and the company.
a.
b.
c.
d.
churn rate
CLTV
cost per lead
cost per sale
Answer: b
77.
Difficulty: Medium
Analyzing sales representative and customer service representative productivity is an
example of:
a.
b.
c.
d.
76.
Chapter 11
Difficulty: Easy
Reference: p. 399
This metric represents the difference between revenues and expenses minus the cost of
promotional marketing used to retain an account:
a.
b.
c.
d.
ROI.
EOQ.
CLTV.
BEP
Answer: c
Difficulty: Medium
Reference: p. 399
Chapter 11
78.
Enterprise Applications and Business Process Integration
The integration of multiple applications from multiple business functions, business units, or
business partners to deliver a seamless experience for the customer, employee, manager, or
business partner is called a:
a.
b.
c.
d.
production platform.
service platform.
forecasting platform.
source platform.
Answer: b
79.
Difficulty: Medium
Reference: p. 401
A methodology for dealing with the organization’s need to change its business processes
continually to remain competitive is called:
a.
b.
c.
d.
business process management.
business process investigation.
business process sourcing.
business process refinement.
Answer: a
80.
11-13
Difficulty: Medium
Reference: p. 401
A Meta Group study of the total cost of ownership of enterprise systems found that the
average TCO was:
a.
b.
c.
d.
$10 million.
$15 million.
$300 million.
$400,000 thousand.
Answer: b
Difficulty: Hard
Reference: p. 403
Fill in the Blanks
81.
Enterprise resource planning (ERO) systems are based on a suite of integrated software
modules and a common central database.
Difficulty: Medium
82.
Reference:
p. 380
Enterprise software consists of a set of interdependent software modules that support basic
internal business processes for finance and accounting, human resources, manufacturing and
production, and sales and marketing.
Difficulty: Medium
Reference:
p. 380
11-14
83.
Enterprise Application and Business Process Integration
Best practices are the most successful solutions or problem-solving methods for consistently
and effectively achieving a business objective.
Difficulty: Easy
84.
p. 385
Reference:
p. 385
Reference:
p. 386
Reference:
p. 386
Reference:
p. 386
In the supply chain process, sourcing consists of processes that procure goods and services
needed to create a specific product or service.
Difficulty: Easy
92.
Reference:
In the supply chain process, planning consists of processes that balance aggregate demand
and supply to develop a course of action to meet sourcing, production, and delivery
requirements.
Difficulty: Easy
91.
p. 383
The downstream portion of the supply chain consists of the organizations and processes for
distributing and delivering products to the final customers.
Difficulty: Medium
90.
Reference:
The upstream portion of the supply chain includes the organization’s suppliers and their
suppliers and the process of managing relationships with them.
Difficulty: Hard
89.
p. 383
The supply chain is a network of organizations and business processes for procuring raw
materials, transforming these materials into intermediate and finished products, and
distributing the finished products to customers.
Difficulty: Medium
88.
Reference:
Supply chain management is the close linkage and coordination of activities involved in
buying, making, and moving a product.
Difficulty: Medium
87.
p. 381
An enterprise-enabled organization does business the same way worldwide.
Difficulty: Medium
86.
Reference:
SAP, Oracle, PeopleSoft and Baan are all vendors of enterprise software packages.
Difficulty: Medium
85.
Chapter 11
Reference:
p. 386
In the supply chain process, making consists of processes that transform a product into a
finished state to meet planned or actual demand.
Difficulty: Easy
Reference:
p. 386
Chapter 11
93.
Enterprise Applications and Business Process Integration
SCOR identifies five major supply chain processes: plan, source, make, deliver, and return.
Difficulty: Medium
94.
Reference:
p. 387
Reference:
p. 387
Reference:
p. 387
If a manufacturer had perfect information about exactly how many units of product
customers wanted, when they wanted them, and when they could be produced, it would be
possible to implement a highly efficient just-in-time strategy.
Difficulty: Hard
99.
p. 387
Logistics deals with the planning and control of all factors that will have an impact on
transporting the correct product or service to where it is needed on time and at the least cost.
Difficulty: Medium
98.
Reference:
In the supply chain process, returning consists of processes associated with returning
products or receiving returned products, including postdelivery customer support.
Difficulty: Easy
97.
p. 386
Inefficiencies in the supply chain are caused by inaccurate or untimely information.
Difficulty: Medium
96.
Reference:
In the supply chain process, delivering consists of processes that provide finished goods and
services to meet actual or planned demand, including order management, transportation
management, and distribution management.
Difficulty: Easy
95.
11-15
Reference:
p. 387
Information about the demand for a product gets distorted as it passes from one entity to the
next across the supply chain is referred to as the bullwhip effect.
Difficulty: Hard
Reference:
p. 387
100. Supply chain planning systems enable a firm to generate demand forecasts for a product and
to develop sourcing and manufacturing plans for that product.
Difficulty: Hard
Reference:
p. 388
101. Demand planning is used to determine how much product a business needs to make to
satisfy all of its customers’ demands.
Difficulty: Easy
Reference:
p. 389
102. Supply chain execution manage the flow of products through distribution centers and
warehouses to ensure that products are delivered to the right locations in the most efficient
manner.
Difficulty: Medium
Reference:
p. 389
11-16
Enterprise Application and Business Process Integration
Chapter 11
103. A(n) metric is a standard measurement of performance.
Difficulty: Medium
Reference:
p. 389
104. Firms can use intranets to improve coordination among their internal supply chain processes,
and they can use extranets to coordinate supply chain processes shared with their business
partners.
Difficulty: Medium
Reference:
p. 390
105. In a push-based model of supply chain management systems, production master schedules
are based on forecasts or best guesses of demand for products, and products are shoved to
customers.
Difficulty: Hard
Reference:
p. 391
106. With new flows of information made possible by Web-based tools, supply chain
management can more easily follow a pull-based model.
Difficulty: Medium
Reference:
p. 391
107. Customer relationship management (CRM) is both a business and technology discipline for
managing customer relationships to optimize revenue, profitability, customer satisfaction,
and customer retention.
Difficulty: Easy
Reference:
p. 393
108. Partnership relationship management (PRM) uses many of the same data, tools, and
systems as customer relationship management to enhance collaboration between a company
and its selling partners.
Difficulty: Easy
Reference:
p. 394
109. A(n) touch point is a method of interaction with the customer, such as telephone, e-mail,
customer service desk, conventional mail, Web site, or retail store.
Difficulty: Medium
Reference:
p. 394
110. Employee relationship management software deals with employee issues that are closely
related to CRM, such as setting objectives, employee performance management,
performance-based compensation, and employee training.
Difficulty: Easy
Reference:
p. 394
111. Sales force automation modules in CRM systems help sales staff increase their productivity
by focusing sales efforts on the most profitable customers, those who are good candidates for
sales and services.
Difficulty: Medium
Reference:
p. 394
Chapter 11
Enterprise Applications and Business Process Integration
11-17
112. Cross-selling is the marketing of complementary products to customers.
Difficulty: Easy
Reference:
p. 395
113. Up-selling is the marketing of higher-value products or services to new or existing
customers.
Difficulty: Easy
Reference:
p. 395
114. Bundling is one kind of cross-selling in which a combination of products is sold as a
package at a price lower than the total cost of the individual products.
Difficulty: Easy
Reference:
p. 395
115. Operational CRM includes customer-facing applications such as tools for sales force
automation, call center and customer service support, and marketing automation.
Difficulty: Easy
Reference:
p. 397
116. Analytical CRM includes applications that analyze customer data generated by operational
CRM applications to provide information for improving business performance management.
Difficulty: Easy
Reference:
p. 397
117. The churn rate measures the number of customers who stop using or purchasing products or
services from a company.
Difficulty: Easy
Reference:
p. 398
118. Customer lifetime value (CLTV) is based on the relationship between the revenue produced
by a specific customer, the expenses incurred in acquiring and servicing that customer, and
the expected life of the relationship between the customer and the company.
Difficulty: Medium
Reference:
p. 399
119. A service platform integrates multiple applications form multiple business functions,
business units, or business partners to deliver a seamless experience for the customer,
employee, manager, or business partner.
Difficulty: Easy
Reference:
p. 401
120. Business process management is a methodology for dealing with the organization’s need to
change its business processes continually to remain competitive.
Difficulty: Easy
Reference:
p. 401
11-18
Enterprise Application and Business Process Integration
Chapter 11
Essay Questions
121.
Identify and briefly describe three major enterprise applications.
Enterprise systems, customer relationship management, and supply chain management are
three enterprise applications. Enterprise systems are based on a suite of integrated software
modules and a common central database. Enterprise systems utilize enterprise software to
support financial and accounting, human resources, manufacturing and production, and sales
and marketing processes. Enterprise systems provide many benefits including an enterpriseenabled organization, improved management reporting and decision making, a unified
information systems technology platform, and more efficient operations and customer-driven
business processes.
Supply chain management systems help an organization better manage its supply chain,
including planning, sourcing, making, delivering, and returning items. Supply chain
management software can be categorized as a supply chain planning system or as a supply
chain execution system. A supply chain planning system enables a firm to generate demand
forecasts for a product and to develop sourcing and manufacturing plans for that product.
A supply chain execution system manages the flow of products through distribution centers
and warehouses to ensure that products are delivered to the right locations in the most
efficient manner. Supply chain management benefits include improved customer service and
responsiveness, cost reduction, and cash utilization.
Customer relationship management systems help firms maximize the benefits of their
customer assets. These systems capture and consolidate data from all over the organization
and then distribute the results to various systems and customer touch points across the
enterprise. Customer relationship management systems can be classified as operational or as
analytical. Operational CRM refers to customer-facing applications, such as sales force
automation, call center and customer service support, and marketing automation. Analytical
CRM refers to customer relationship management applications dealing with the analysis of
customer data to provide information for improving business performance. Benefits include
increased customer satisfaction, reduced direct marketing costs, more effective marketing,
and lower costs for customer acquisition and retention.
122.
What is an enterprise system? What is enterprise software?
Enterprise systems focus on integrating the key internal business processes of the firm.
Enterprise software is used by enterprise systems and is a set of integrated software modules
for finance and accounting, human resources, manufacturing and production, and sales and
marketing that allows data to be used by multiple functions and business processes.
123.
What are the benefits of enterprise systems? What are the challenges of enterprise systems?
Benefits include creating an enterprise-enabled organization, providing firmwide knowledgebased management processes, providing a unified information system technology platform
and environment, and enabling more efficient operations and customer-driven business
processes. Challenges include a daunting implementation process, surviving a cost-benefit
analysis, inflexibility, and realizing strategic value.
Chapter 11
124.
Enterprise Applications and Business Process Integration
11-19
What is SCOR? Identify its five major processes.
The Supply Chain Operations Reference Model (SCOR) was developed by the Supply Chain
Council. This cross-industry process reference model defines a common set of supply chain
processes to help businesses better understand supply chain management issues and set goals
for supply chain improvement. The five major processes include plan, source, make, deliver,
and return. The planning process consists of processes that balance aggregate demand and
supply to develop a course of action to meet sourcing, production, and delivery requirements.
The sourcing process consists of processes that procure goods and services needed to create a
specific product or service. The make process consists of processes that transform a product
into a finished state to meet planned or actual demand. The delivery process consists of
processes that provide finished goods and services to meet actual or planned demand,
including order management, transportation management, and distribution management. The
return process consists of processes associated with returning products or receiving returned
products, including postdelivery customer support.
125.
Identify two classifications for supply chain software. For each classification, identify five
capabilities.
Supply chain planning systems and supply chain execution systems are two classifications
for supply chain software. Supply chain planning systems enable a firm to generate demand
forecasts for a product and develop sourcing and manufacturing plans for that product.
Capabilities include order planning, advanced scheduling and manufacturing planning,
demand planning, distribution planning, and transportation planning. Supply chain execution
systems manage the flow of products through distribution centers and warehouses to ensure
that products are delivered to the right locations. Capabilities include order commitments,
final production, replenishment, distribution management, and reverse distribution.
126.
Describe service platforms and their relationship to enterprise applications.
Service platforms integrate data and processes from the various enterprise
applications (customer relationship management, supply chain management, and
enterprise systems), as well as from disparate legacy applications to create new
composite processes. Enterprise applications can serve as building blocks for new
cross-functional service platforms. A new composite process is modeled using
business process management tools, and application integration software ties various
systems together. The new services are delivered through enterprise portals, which
can integrate disparate applications so that information appears to be coming from a
single source.
127.
What is a metric? Identify five metrics for measuring supply chain performance.
A metric is a standard measurement of performance. Ten metrics were identified in the
textbook, including fill rate, on-time deliveries, average time from order to delivery, total
supply chain costs, number of days of supply in inventory, asset turns, supply chain response
time, forecast accuracy, cycle time, and cash-to-cycle time.
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128.
Enterprise Application and Business Process Integration
Chapter 11
Identify two supply chain models. Which is better?
Push-based and pull-based models were discussed in the textbook. Push-based refers to a
supply chain driven by production master schedules based on forecasts or best guesses of
demand for products. Pull-based refers to a supply chain driven by actual customer orders or
purchases so that members of the supply chain produce and deliver only what customers
have ordered. Pull-based models are better.
129.
Identify two aspects of customer relationships management.
Operational CRM and analytical CRM are two aspects. Operational CRM refers to
customer-facing applications, such as sales force automation, call center and customer
service support, and marketing automation. Analytical CRM refers to customer relationship
management applications dealing with the analysis of customer data to provide information
for improving business performance.
130.
Identify five benefits of customer relationship management systems.
Benefits include: better customer service, make call centers more efficient, cross-sell
products more effectively, help sales staff close deals faster, simplify marketing and sales
processes, acquire new profitable customers, sell additional products and services, provide
customer information for developing new products, increase product utilization, reduce sales
and marketing costs, identify and retain profitable customers, optimize service delivery costs,
retain high-lifetime value customers, improve customer loyalty, improve response rates to
direct mail, increase product profitability, respond quickly to market opportunities.