Chapter 10
E-business and Enterprise Resource Planning Systems
Outline
Expected outcomes
E-business
ERP systems
Application service providers
Expected outcomes
Explain the nature of e-business, comparing and contrasting it with traditional brick-and-mortar organizations.
Discuss major forms of e-business.
Describe the basic nature, purpose and structure of ERP systems.
Give examples and analyze the causes of ERP system failures.
List and discuss steps associated with successful ERP implementations.
Discuss the role of application service providers in e-business.
E-business
Defining feature
Business is transacted via computer networks.
Benefits
Expanded marketing
Reduced operating costs
Streamlined operations
Product / service delivery
Costs
Network setup
Different internal controls
Customer distrust potential
Consequences of technology breakdowns
E-business
Five major categories
Business to consumer
www.travelocity.com
Business to business
www.officedepot.com
Government to consumer
www.sec.gov
Government-to-business
www.sba.gov
Consumer-to-consumer
www.angieslist.com
ERP systems
Relational databases designed to provide comprehensive, integrated information about an organization
One form of event-driven AIS
Common modules
Customer relationship management
Human resource management
Supply chain management
Financial management
ERP systems
Failure causes
Human resource related
Poor top management leadership
Poor project management
Inadequate education & training
Unrealistic expectations
Project seen as IT only
Business process related
Trying to maintain status quo
Automating poor processes
Bad match between processes and system
Technology related
Inaccurate data
Technical issues
ERP systems
Conditions for success
Organizational commitment
Clear communication
View as enterprise-wide venture
Select compatible system
Resolve multi-site issues
Ensure data accuracy
Lecture break 10-2
Working with a group of three to five students, explain how one of the following could relate to ERP projects:
Database normalization
Expectancy theory
Systems development life cycle
COSO frameworks
Application service providers
Description
Third-party entity
Deploys, hosts & manages access to packaged application
Delivers software-based services over a network
Examples
Web hosting
E-mail providers
Transaction processing
E-mail security
Virtual offices
Application service providers
ASPs can present additional internal control challenges and issues
Service organization audits can address some of them
Old standard
Statement of Auditing Standards 70 (SAS 70)
Replaced since text was published
Application service providers
New standard
Statement on Standards for Attestation Engagements 16 (SSAE 16)
Motivated by two forces
Misuse of SAS 70
Convergence with international standards
Classroom assessment
This chapter has focused on e-business, ERP systems and application service providers.
Form a group of three to five students.
Select one of those three topics.
As a group, write down:
Three things you know about the topic.
Three things you want to know about the topic.