CHAPTER 7 : STORING ORGANIZATIONAL INFORMATION - DATABASES

What is INFORMATION?

RELATIONAL DATABASE FUNDAMENTALS

Information is everywhere in an organization

Information is stored in databases

Database – maintains information about various types of objects (inventory), events (transactions), people (employees), and places (warehouses)

RELATIONAL DATABASE FUNDAMENTALS

Database models include:

·   Hierarchical database model – information is organized into a tree-like
    structure (using parent/child relationships) in such a way that it cannot have
    too many relationships

·   Network database model – a flexible way of representing objects and their
    relationships

·   Relational database model – stores information in the form of logically related
    two-dimensional tables

Entities and Attributes

·         Entity – a person, place, thing, transaction, or event about which information is stored

The rows in each table contain the entities

·         Attributes (fields, columns) – characteristics or properties of an entity class

The columns in each table contain the attributes

Keys and Relationships

Primary keys and foreign keys identify the various entity classes (tables) in the database

·         Primary key – a field (or group of fields) that uniquely identifies a given entity in a table

·         Foreign key – a primary key of one table that appears an attribute in another table and acts to provide a logical relationship among the two tables

RELATIONAL DATABASE ADVANTAGES

Database advantages from a business perspective include

· Increased flexibility

· Increased scalability and performance

· Reduced information redundancy

· Increased information integrity (quality)

· Increased information security

· Increased Flexibility

A well-designed database should:

· Handle changes quickly and easily

· Provide users with different views

· Have only one physical view – deals with the physical storage of
  information on a storage device

· Have multiple logical views - focuses on how users logically access information

Increased Scalability and Performance

A database must scale to meet increased demand,  while maintaining acceptable performance levels

· Scalability – refers to how well a system can adapt to increased demands

· Performance – measures how quickly a system performs a certain process or
  transaction

Reduced Information Redundancy

Databases reduce information redundancy

· Redundancy – the duplication of information or storing the same information in
  multiple places

Inconsistency is one of the primary problems with redundant information

Increase Information Integrity (Quality)

Information integrity – measures the quality of information

Integrity constraint – rules that help ensure the quality of information

· Relational integrity constraint

· Business-critical integrity constraint

Increased Information Security

Information is an organizational asset and must be protected

Databases offer several security features including:

· Password – provides authentication of the user

· Access level – determines who has access to the different types of information

· Access control – determines types of user access, such as read-only access

Database management systems (DBMS) – software through which users and application programs interact with a database

DATA-DRIVEN WEBSITES

Data-driven websites – an interactive website kept constantly updated and relevant to the needs of its customers through the use of a database.

DATA-DRIVEN BUSINESS INTELLIGENCE

CHAPTER 6 – VALUING ORGANIZATIONAL INFORMATION

ORGANIZATIONAL INFORMATION

·         Information is everywhere in an organization

·          Employees must be able to obtain and analyze the many different levels, formats and granularity of organizational information to make decisions

·          Successfully collecting, compiling, sorting and analyzing information can provide tremendous insight into how an organization is performing

·         Levels, formats and granularity of organizational information

The Value of Transnational And Analytically Information

·       Transaction information verses analytically information

     

THE VALUE OF QUALITY INFORMATION

-    Business decisions are only as good as the quality of the information used to make the decisions

-   You never want to find yourself using technology to help you make a bad decision faster

-   Characteristics of high-quality information include;

-   Low quality information example;

UNDERSTANDING THE COSTS OF POOR INFORMATION

-   The four primary sources of low quality information include;

- Online customers intentionally enter inaccurate information to protect their privacy

- Information from different systems have different entry standards and formats

- Call center operators enter abbreviated or erroneous information by accident or to save time

- Third party and external information contains inconsistencies, inaccuracies and errors

-   Potential business effects resulting from low quality information include;

- Inability to accurately track customers

- Difficulty identifying valuable customers

- Inability to identify selling opportunities

- Marketing to nonexistent customers

- Difficulty tracking revenue due to inaccurate invoices

- Inability to build strong customer relationships

UNDERSTANDING THE BENEFITS OF GOOD INFORMATION

-   High quality information can significantly improve the chances of making a good decision

-   Good decisions can directly impact an organization’s bottom line

CHAPTER 5 : ORGANIZATIONAL STRUCTURES THAT SUPPORT STRATEGIC INITIATIVE

Organizational Structure

ü  Organizational employees must work closely together to develop strategic initiatives that create competitive advantages.

ü  Ethics and security are two fundamental building blocks that organizations must base their businesses upon.

IT Roles And Responsibilities

Information technology is a relatively new function area, having only been around formally for around 40 years.

Recent IT-related strategic positions :

·         Chief Information Officer (CIO)

·         Chief Technology Officer (CTO)

·         Chief Security Officer (CSO)

·         Chief Privacy Officer (CPO)

·         Chief Knowledge (CKO)

1.   Chief Information Officer (CIO)

Oversees all uses of IT and ensures the strategic alignment of IT with business goals and objectives

Broad CIO functions include:

Ø  Manager

ensuring the delivery of all IT projects, on time and within budget.

Ø  Leader

ensuring the strategic vision of IT is in line with the strategic vision of the organization.

Ø  Communicator

Building and maintaining strong executive relationships.

If they have any problem involve IT personal, CIO that will solve it. (more effectiveness)

1.   Chief Technology Officer (CTO)

Ø  responsible for ensuring the throughput, speed, accuracy, availability, and reliability of IT.

Ø  effectiveness because make sure the system is efficient

1.   Chief Security Officer (CSO)

Ø  responsible for ensuring the security of IT systems.

Ø  to make sure the system we do, no person can hack

1.   Chief Privacy Officer (CPO)

Ø  responsible for ensuring the ethical and legal use of information

1.   Chief Knowledge Office (CKO)

Ø  Responsible for collecting, maintaining, and distributing the organization's knowledge.

ORGANIZATIONAL FUNDAMENTALS

Ø  Ethics and security are two fundamental building blocks that organizations must base their businesses on to be successful.

Ø  In recent years, such events as the Enron and Martha Stewart, along with 9/11 have shed new light on the meaning of ethics and security.

• Ethics
• the principles and standards that guide our behavior toward other people

• Privacy is major ethical issue
• privacy
• the right to be left alone when you want to be, to have control over your own personal possessions, and not to be observed without your consent.
• sometimes, we fell want to alone. don't want anyone bother
• we don't want someone to corrupt our business.

• Issues affected by technology advances
• intellectual property.
• intangible creative work that is embodied in physical form. for example, from idea to something we can hold. 
• create new things. so, there is intellectual property, can touch.
• things that comes from a creative idea.
• such as architects, building that we can touch.
• copyright
• the legal protection afforded an expression of an idea, such as a song, video, game, and some types of proprietary documents.

• fair use doctrine
• in certain situations, it is legal to use copyrighted materials. for example song from oversea to Malaysia.

• pirated software
• the unauthorized use, duplication, distribution, or sale of copyrighted software. more cheap and free.
• counterfeit software
• software that is manufactured to look like the real thing and sold as such. for example, buy antivirus, notify original but not original.

• One of the main ingredients in trust is privacy. the system is effective because customer will be satisfied but efficiency because the system can be slow.
• 
  

• Security
• organizational information is intellectual capital - it must be protected.

• Information security
• the protection of information from accidental or intentional misuse by persons inside or outside an organization.
• the CSO who save the information.

• E-business automatically creates tremendous information security risks for organizations.

CHAPTER 4 – MEASURING THE SUCCESS OF STRATEGIC INITIATIVES

MEASURING INFORMATION TECHNOLOGY’S SUCCESS

-          Key performance indicator – measures that are tied to business drivers

-          Metrics are detailed measures that feed KPIs

-          Performance metrics fall into the nebulous area of business intelligence that is neither technology, nor business centered, but requires input from both IT and business professionals

EFFICIENCY AND EFFECTIVENESS

-          Efficiency IT metric – measures the performance of the IT system itself including throughput, speed, and availability

-          Effectiveness IT metric – measures the impact IT has on business processes and activities including customer satisfaction, conversion rates, and sell-through increases

BENCHMARKING – BASELINE METRICS

-          Regardless of what is measured, how it is measured, and whether it is for the sake of efficiency or effectiveness, there must be benchmarks – baseline values the system seeks to attain

-          Benchmarking – a process of continuously measuring system results, comparing those results to optimal system performance (benchmark values), and identifying steps and producers to improve system performance

-          Comparing efficiency IT and effectiveness IT metrics for the government initiatives

EFFICIENCY IT METRIC

·         Measure the performance of the IT system itself including throughout,speed and availability.

·         lots of useful information

EFFECTIVENESS IT METRIC

·         Measure the impact it has on business processes and activities including customer satisfaction, conversation rates, and sell-through increases.

·         The extent to which our services are prefer by many consumers.

METRICS FOR STRATEGIC INITIATIVES

-          Metrics for measuring and managing strategic initiatives include;

·         Website metrics.

·         Supply chain management (SCM) metrics

·         Customer relationship management (CRM) metrics

·         Business process reengineering (BPR) metrics

·         Enterprise resource planning (ERP) metrics

WEBSITE METRICS

SUPPLY CHAIN MANAGEMENT METRICS

CUSTOMER RELATIONSHIP MANAGEMENT METRICS

BPR and ERP Metrics

-          The balanced scorecard enables organizations to measure and manage strategic initiatives.

CHAPTER 3: STRATEGIC INITIATIVES FOR IMPLEMENTING COMPETITIVE ADVANTAGES SUPPLY CHAIN MANAGEMENT

Supply chain management (SCM) involves the management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability. The four basic components of supply chain management are:

1. Supply chain strategy - the strategy for managing all the resources required to meet customer demand for all products and services.
2. Supply chain partners -the partners chosen to deliver finished products, raw materials, and services including pricing, delivery, and payment processes along with partner relationship monitoring metrics.
3. Supply chain operation - the schedule for production activities including testing, packaging and preparation for delivery. Measurements for this component include productivity and quality.
4. Supply chain logistics - the product delivery processes and elements including orders, warehouse, carriers, defective product returns, and invoicing.  

Effective and Efficient Supply Chain Management's Effect on Porter's Five Forces

Effective and efficient supply chain management systems can enable an organization to:

• Decrease the power of its buyers.
• Increase it’s own supplier power.
• Increase switching costs to reduce the threat of substitute products or services.
• Create entry barriers thereby reducing the threat of new entrants.
• Increase efficiency while seeking a competitive advantage through cost leadership.

Customer Relationship Management

Customer relationship management (CRM) involves managing all aspects of a customer's relationship with an organization to increase customer loyalty and retention and an organization's profitability.

 CRM overview

Based on the figure, it’s provides an overview of a typical CRM system. Customers contact an organization through various means including call centers, web access, email, faxes, and direct sales. A single customer may access an organization multiple times through many different channels. The CRM system tracks every communication between the customer and the organization and provides access to CRM information within different systems from accounting to order fulfillment. Understanding all customer communications allows the organizations to communicate effectively with each customer.

CRM Strategy

It is important to realize that CRM is not just technology, but also a strategy that an organization must embrace on an enterprise level. Although there are many technological components of CRM, it is actually a process and business goal simply enhanced by technology. Implementing a CRM system can help an organization identify customers and design specific marketing campaigns tailored to each customer, thereby increasing customer spending. A CRM system also allows an organization to treat customers as individuals, gaining important insights into their buying preferences and behaviors and leading to increased sales, greater profitability and higher rate of customer loyalty.

Business Process Re-engineering

A business process is a standardized set of activities that accomplish a specific task, such as processing a customer's order. Business process re-engineering (BPR) is the analysis and redesigns of workflow within and between enterprises. The concept of BPR traces its origins to management theories developed as early as the 19th century. The purpose of BPR is to make all business process the best-in-class.

Seven Principles of Business Process Re-engineering

Finding Opportunity Using BPR

Companies frequently strive to improve their business processes by performing tasks faster, cheaper, and better.

Better, Faster, Cheaper of BPR

Based on the figure that displays different ways to travel the same road.  A company could improve the way that it travels the road by moving from foot to horse and then from horse to car. However, true BPR would look at taking different path. A company could forget about traveling on the same old road and use an airplane to get to its final destination. Companies often follow the same indirect path for doing business, not realizing there might be a different, faster and more direct way of doing business.

Pitfalls of BPR 

One hazard of BPR is that the company becomes so wrapped up in fighting its own demons that it fails to keep up with its competitors in offering new products or services. While American Express tackled a comprehensive re-engineering of its credit card business, MasterCard and Visa introduced a new product- the corporate procurement card. American Express lagged a full year behind before offering its customers the same service.

Enterprise Resource Planning

Today's business leaders need significant amounts of information to be readily accessible with real-time views into their businesses so that decisions can be made when they need to be, without the added time of tracking data and generating reports. Enterprise resource planning (ERP) integrates all departments and functions throughout an organization into a single IT system so that employees can make decisions by viewing enterprise-wide information on all business operations.

Auto Insurance Claims Processes

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