19 Apr 2012
School
Department
Course
Professor
Monday, October 25th, 2010
Chapter 4
Enterprise Systems
Value Chain:
-The value chain is a connected series of activities, each of which adds value or supports the addition of
value to the firm’s goods and services1
-Every action an organization takes, from securing the necessary raw materials (input) to making the
goods or service (process) to completing a transaction with a customer (output), is either a primary
activity or support activity
-A transaction is an exchange of goods or services (value) between two or more parties
Primary Activities:
-Primary activities are directly related to the production and distribution of the organization’s products
and services that create business value for the organization and its customers
-Example primary activities include inbound logistics (obtaining raw materials), operations (creating the
product), outbound logistics (shipping the product), and marketing, sales, and service (selling the
product)
Supportive Activities:
-Support activities are value chain activities that an organization conducts to support the creation of
business value
-Support includes:
1. Firm infrastructure (which we will call administration)
2. Technology development
3. Human resource (HR) management
4. procurement
Information Systems that Supports Business Activities:
• Functional Information Systems (FIS):
focus on departmental activities to improve efficiency and effectiveness
• Workflow Management Systems (WMS)
A workflow represents the steps, resources, input and output data, and tools needed to
complete a business process
A workflow management system (WMS) or business process management (BPM)
focuses on a business process from beginning to end
WMS enables modelling the steps of the business process to show the flow of work
along with the state of the components
• Transaction Processing Systems (TPS)
A TPS brings together the common components of IT
A TPS must control the flow of both the activities and data involved in the transaction
TPS must incorporate:
the logic for controlling and enabling transactions
the business rules of the organization
necessary error-handling logic
• Management Information Systems (MIS)
Businesses use captured and stored data to create information, which is used for
decision making