BISM1201

Functional Processes (aka 'silos')

Activities in a single department or functional area (e.g. Accounting, HRM, sales forecasting, etc.)

Entity type - domain and linking types (avoid M:n)

- A 'domain' entity type - describe a core business element of a database - e.g. 'Employee' and 'Course' - Frequently (in the logical model) - joined by M:n relationships (many to many) - not workable in the 'build' stage - better to use a 'linking' (or associative) entity to remove this problem - this will usually produce a 'composite' primary key

Relational Database model - a data hierarchy

- A database contains 1 or more tables (or files) - Each table contains 1 or more records (these are the rows of the table - we shall later call these entities) - Each row contains 1 or more fields (characteristics or attributes of a record) - A database is far more powerful than a spreadsheet - good business analysts use both to complement each other - A database can store huge volumes of data - and a huge variety of data types (metadata) A database is far more efficient in processing. A spreadsheet updates all cells (i.e. formulas) when any cell changes in value. A database updates only those records targeted

The Need for Keys and for Relationships

- A relational database comprises 1 or more tables (almost always - several tables. - We always want to use all the tables in a database. How do we find the emails for Andrea Baker or the office visit details for Adam Verberra? - Without using foreign keys to form relationships, we cannot. This is the importance of foreign keys.

SCRUM Framework

-Roles: Product Owner, Scrum Master, Team -Ceremonies: Sprint Planning, Sprint Review, Sprint Retrospective, Daily Scrum meeting -Artifacts: Product Backlog, Sprint Backlog, Burndown Charts

Reporting BI Systems

A reporting application uses a reporting tool to compile data from multiple sources into a form that is information for the user. Reporting BI systems deliver reports to authorized users at appropriate times using operations: - Sorting, Grouping, Calculating, Filtering, Formatting Two such applications are: - OLAP and RFM analysis

Competitive Strategy

A statement that identifies a business's approach to compete, goals, and plans and policies required to carry out those goals

Michael Porter's Industry Structure/Competitive Forces Model

Also Competing Organisations

Data‐mining Applications

Application of statistical techniques to find patterns and relationships among data for purpose of classifying and predicting. Unsupervised Data Mining: - Analysts do not create a model before running analysis - Apply data‐mining techniques and observe results - Hypotheses created after analysis as explanation for results - Common statistical technique used: ○ Cluster analysis to identify groups with similar characteristics Supervised Data Mining: - Model developed before analysis - Statistical techniques used to estimate parameters - Regression analysis ○ Used for making predictions Measures the impact of a set of (independent) variables on another (dependent) variable. We are looking for causal linkages

Business Process Management (BPM)

BPM is a body of methods, techniques and tools to discover, analyse, redesign, execute and monitor business processes. It is about managing entire chains of events, activities and decisions that ultimately add value to the organization and its customers. These "chains of events, activities and decisions" are called processes.

Supply chains

Supply chain: - The coordinated flow of materials, information, money, and services from raw material suppliers, through factories and warehouses, to the end customers Supply chain visibility: - The ability of all organisations in a supply chain to access relevant data through the supply chain Increases 'inventory velocity' - earlier delivery time of goods and services

Problems along the supply chain

Two major sources of problems - Uncertainties in ○ Demand forecast - very difficult to accurately determine ○ Delivery times - many variables - many stakeholders - outside direct control of the organisation ○ Quality of materials and parts - Need to coordinate multiple activities, internal units, and business partners The bullwhip effect : Erratic shifts in orders up and down the supply chain

Business Intelligence - Types or Forms

We have various types of BI: - Operational reporting, very structured, e.g., issue of simple, preformatted statements - Ad Hoc reporting - more flexibility for the end‐user - OLAP (Online Analytical Processing, very heavily used, very supporting of management/executives - Data Mining - Dash‐Boards (consolidated listings of critical success indicators) - for executive staff AND OTHERS!

Agile Methodologies

- Agile development is an umbrella term that describes several agile methodologies - They aim at being adaptive rather than predictive - In 2001, methodologies included, Scrum, XP, Crystal family, Dynamic Systems Development Method (DSDM), and Feature‐ Driven Development (FDD). Since then, other practices have also emerged - Each agile methodology has a slightly different approach - Popularity/take‐up: ○ 50% of agile ISD teams are doing Scrum ○ 20% are doing Scrum with XP components ○ 12% are doing XP alone ○ More than 80 percent of agile implementations worldwide are Scrum or XP

Information Systems Development

- Also known as systems analysis and design - Process of creating AND maintaining information systems - Involves all five components of Information systems: Hardware, software, data, procedures, people

Corporate management of data - Difficulties

- Amount of data is increasing exponentially - Data are scattered throughout organizations and collected by many individuals using various methods and devices - Data come from within a business and also from outside the business (inside the business - functional IS, outside the business: supply chain, regulators, etc) - Data are subject to data rot (outdated, destroyed storage media) - Data security is critical, yet easily jeopardised - Inconsistent, conflicting data due to non-integrated information systems - Government regulations (Australia's Privacy Act 1988 - overseas jurisdictions) - Result: Companies are not effectively using their business information (the set text says "drowning") The modern corporation wants BUSINESS INTELLIGENCE

Red Ocean Strategy

- Beat the competition - Compete in existing market space - Outperform rivals - Grab a bigger share of product or service demand Focusing on: - Strategic choice of differentiation or low cost Defend current position perspective

What do you do in Business Process Management (BPM)?

- Business Process Management: "continuous improvement" philosophy - Applies to all processes including core, supporting, supply chain, strategy and governance, operations, etc - Incremental change and improving efficiency - Incorporates tools and techniques to connect Strategy and governance objectives to operations and overall processes in organizations

Defining customer relationship management

- CRM system (as distinct from CRM strategy) • ○ Information system designed to support an organization's CRM strategy • ○ Two basic elements: 1. Identify customer touch points (GRAPHIC BELOW ‐ various types of customer interactions) 2. Consolidate data about each customer, via a 360‐degree view of a customer - A complete dataset on each customer consolidated from various functional areas - Made available to every unit of the business through a data warehouse This information sharing leads to collaborative CRM systems - EFFECTIVE AND EFFICIENT INTERACTIVE (TWO‐WAY) COMMUNICATION WITH THE CUSTOMER THROUGHOUT THE ENTIRE ORGANIZATION

User Stories Procedure

- Create User Stories: A user story describes functionality that will be valuable to either a user or purchaser of a system or software. User stories are written from the end user's point of view. For example: "As a returning customer, I want to find a meal that I have ordered before." - Prioritize the User Stories: Product owner prioritizes the user stories in the product backlog by working with your customers to understand what they value and by working with your team to understand risks and dependencies. Product owner specifies priorities by assigning a rank to each user story to indicate the order in which the team should implement them. - Estimate the User Stories: Team collaboratively estimates each user story in story points. Story points are a unit of measure for expressing the overall size of a user story, feature or other piece of work. Story points are relative values that do not translate directly into a specific number of hours. Instead, story points help a team quantify the general size of the user story.

Blue Ocean Strategy

- Create uncontested market space - Make the competition irrelevant - Create and capture new demand - Break the value-cost trade off Focusing on: - Strategic choice of differentiation or low cost - Innovate and pursue new opportunities perspective

ERP integrates Functional Application IS (FAIS) ‐ CROSS FUNCTION IS

- Current business solution: ERP (a cross functional OR interorganizational) Problems: - Decentralized data - Human error - Excessive costs - Audit problems - compliance problems - consistent reporting Definition: - ERP is a business solution software that integrates and automates the data management (planning, management and use) of a companies business processes and resources - ERP: A suite of applications, a database and a set of standardised processes for consolidating business operations into a single, consistent computing platform Benefits Delivered: - Accurate data across the organization / business - Faster decision making - Lower cost basis - More compliance / better reporting Seamless operation (no 'islands' created within the organization - no 'silos')

Organisation' Values

- Customer Satisfaction - Reliability - Safety - Consistency - Cost Efficiency - Environmental Efficiency - High product quality - High service quality - Effective services - Financial revenue

CRM Customer‐touching applications

- Customers interact directly with technologies and applications rather than interact with a company representative (i.e. customers can 'help themselves) - Consists of: ○ Search and comparison capabilities ○ Technical and other information and services Other examples of customer‐touching applications - Customized products and services (customers configure their own products) - Personalized web pages created by customers (example Qantas) - FAQs - E‐mail and automated response Loyalty programs (mainly designed to influence future behaviour NOT SIMPLY to reward past behaviour)

The solution must start with senior management : data governance

- Data governance (what does 'governance' mean in its general context?) ○ Here it means: "An approach to managing information across an entire organisation" - Master/Enterprise data management ○ A central component for data governance ○ A process that spans all of an organisation's business processes and applications ○ Master data: A set of core data that covers a complete enterprise information system (not individual 'instances' of data - e.g. master data for UQ would include 'student' and then the 'instances' of this data would be the thousands of students studying at UQ) - i.e., a consistent, well-defined 'student' record applicable to all faculties, schools and administrative groups - The database is a fundamental concept in operationalizing master data management

Logically Modelling the Database - Definitions

- Data model: A diagram that represents the entities in the database and their relationships (we shall encounter 'process modelling' later in the semester) - Designers plan the database using an entity-relationship model - Entity-relationship (ER) modeling ○ Entity → A person, place, thing, or event about which information is maintained → Entity classes: Groups of entities of a certain type (group of records) → Entity instance: The representation of a particular entity (a record) ○ Attribute → A particular characteristic or quality of a particular entity → Primary key (or identifier): A field that uniquely identifies a record → Foreign key: Established relationships between tables ○ Relationship → Connect entities - these are usually defined by BUSINESS RULES → Types: One-to-one, One-to-many, Many-to-many → Minimum and maximum cardinality (the MODALITY as it is described in the text)

Relational database model

- Data represented as one or more two dimensional tables with columns and rows

Metadata (associated with databases and spreadsheets)

- Database is self-describing ○ Contains descriptions of its data - Metadata ○ Data that describe data ○ Make databases more useful ○ Make databases easier to use - Examples of Metadata ○ Field name ○ Data type ○ Field properties ○ Description We have seen this with Excel, e.g. the type of data in each cell (i.e. formatting information)

Database management systems

- Database management system (DBMS): Specific type of software for creating, storing, updating, and accessing/reading data from a database - Database comprises DBMS + DATA (in the circle above). - The DBMS is all software - it exclusively manages the data - not the positioning and the arrows/lines. - The user interacts with the DBMS directly or via another layer of software (e.g. an accounting application system (as above) in the accounting department. - This architecture/solution scales and distributes (over geography) very well.

Databases

- Databases are considered the most successful of business software (for about the last 30 years) - Databases comprise the data AND database management systems (DBMS) to provide very efficient, possibly centralized access to large data sets - The most popular architecture in business today is to combine a database/DBMS with a web server to produce results like Wikipedia, Ebay, Google, Amazon and many, many others. Databases minimize the following problems: ○ Data redundancy: The same data are stored in many places ○ Data isolation: Applications cannot access data associated with other applications ○ Data inconsistency: Various copies of the data do not agree And help maximize: ○ Data security: Keeping the organization's data safe from theft, modification, and/or destruction ○ Data integrity: Data must meet constraints and be reliable/correct Data independence: Software Applications AND data are independent of one another

Risk Controls

- Defence mechanisms to protect information assets - Comprise (1) policy (usually set by management) (2) education / training / awareness (3) technology

SCRUM Role: Product Owner

- Define the features of the product - Decide on release date and content - Be responsible for the profitability of the product (ROI) - Prioritize features according to market value - Adjust features and priority every iteration, as needed Accept or reject work results

Feasibility Estimation Problems

- Estimating is just "theory", the average of many people's guesses - Project managers sum up estimates and take results to management - Management then negotiates the schedule and budget by reducing time a month or two (where is the justification) - Negatively impacts the project (i.e. 'negotiation causes problems') - Typically, project starts with optimistic schedules and ends up late - Developers/managers begin to not take project deadlines seriously

Activity and Event Labels

- Event: noun + past-participle verb ○ (e.g. Insurance claim lodged, application received, report generated) - Activity: verb + noun ○ (e.g. Assess credit risk, Give instruction, Make phone call) - No long labels < 5 words

Process Scope - Boundaries

- Functional Processes - Cross-Functional Processes - Inter-organisational Processes

Component Design

- Hardware design determined by project team ○ Specifications and the source/vendor - Software design depends on source (i.e. where is comes from) ○ Off‐the‐shelf ○ Off‐the‐shelf with alterations ○ Custom‐developed programs - Database design Procedure design for users and operations personnel ○ Normal, backup, failure recovery procedures - People ○ Duties and responsibilities for new jobs and revised jobs Three following Steps: Build: - Components / modules constructed independently then combined (some components may be outsourced) - Document and review Test: - Individual components tested (we call this unit testing) - System and tested (system /integration testing) - Must ensure all sequences of actions that users take when employing system - both normal and incorrect actions should be considered - Labour intensive - almost always empirical - Should testing be done at this very late stage? - Users must be trained to use the new system Convert (NEXT SLIDE): - how to take the system 'live'

On-Site Customer

- In this area - heavy influence on changing the SDLC - Customer is part of the team/project - User stories are not detailed, so there are always questions to ask the customer - Software Developers have continuous access to a real live customer, that is, someone who will actually be using the system - The customer must always be available ○ to resolve ambiguities ○ set priorities provide test cases (testing is also performed incrementally in Xp)

PM Responsibilities

- Internal Responsibilities ○ Developing the project schedule - integrity and feasibility ○ Establish the project environment ○ Recruiting and training team members ○ Schedule the work - assign work to teams and team members ○ Risk assessment ○ Monitoring and controlling project deliverables and milestones - External Responsibilities ○ Reporting the project's status and progress ○ Working directly with the client and other stakeholders Identifying and obtaining resource needs

Relationship type - lookup - weak (avoid NULLs)

- Our previous ERD construct (a single entity) has been replaced by the ERD shown above - The entities 'Video', 'Book' and 'Magazine' are 'lookup' and 'weak' entities - they depend on 'Media' - there must be an entry in 'Media' for an entry to be created in the 'weak' entities - This ERD will avoid NULLs at the 'build' stage - considered a better logical design

Relationship type - lookup (avoid NULLs)

- Many times we have an entity that will produce tables (in the physical build) that contain what we call NULL values. - Consider the entity shown 'Media' - representing books, movies and magazine. - However this entity - because not all attributes relate to all three media types - will produce the following table (note the entries heavily shaded) - Shaded attribute values will produce (in the 'build stage') NULL - a special marker in SQL to indicate that a value does not exist in the database - in the SQL specification, NULL is defined as "missing information and inapplicable information" - NULL produces problems - we should avoid this design

Market‐Basket Analysis

- Market‐basket analysis is a data mining technique for determining sales patterns - ○ Uses statistical methods to identify sales patterns in large volumes of data - ○ Shows which products customers tend to buy together - ○ Used to estimate probability of customer purchase - Helps identify cross‐selling opportunities, e.g. 'Customers who bought book X also bought book Y'

Normalization of ERD

- Normalization - one of the last stages of the 'logical' design process - it is best done when we have ERDs and we can also consider each entity as a table! - Normalization basically means: we cannot produce 'one big table' - Normalization can be quite difficult - but it delivers a lot! ○ A process of improving the database design structure by putting it into its most streamlined form ○ Minimizes redundant data - Maximizes data integrity ○ Provides best processing performance (i.e. how quickly the database can be accessed/edited)

Online Analytical Processing Reports (OLAP)

- OLAP is a Reporting BI Application Problems before OLAP: - Significant time lag from requesting analysis to the provision of the analysis - Very inflexible - not enough variety of queries to the production database - Solution was OLAP Strengths: - Speeds up the provision of quality data to decision makers - Increases the decision makers' opportunities for querying the production data Weaknesses: - Relies heavily on the IT department to prepare the queries Very good for structured queries (finance) - not so good for unstructured Operational Structure: - Dimensions - anything that can consistently categorize the data - Measures - numerical values that can be added up to provide meaning to dimensions - Hierarchies - refers to the 'granularity' of the data - very relevant when we 'drill down' into the data - OLAP is based on a cube of 'precalculated' data (may require substantial computing power) - An OLAP Report shows simple arithmetic operations on data ○ Sum, average, count etc. - Has a dynamic format ○ User can change report structure and view online - can 'drill down' - Contains dimensions ○ Anything that can consistently categorize the data (e.g. customer, region, product, year) - Contains measures ○ Numerical values that can be added up/manipulated to provide meaning to dimensions (revenue, cost, quantity) - ○ Hierarchies - refers to the granularity of the data - very relevant when we 'drill down' into the data

Alternatives to SDLC

- One technique based on the ideas of incremental and evolutionary methodologies is the Agile approach ‐ also frequently described as a light weight methodology for designing systems ○ Emphasis on people and cooperation over processes and tools ○ Working software is more important than documentation ○ Customer collaboration over contract negotiation ○ User involvement at the level of true collaboration Responding to change over following a plan (plans have a short 'half‐life')

Putting it all together - BI via a data warehouse

- Operational data, e.g. from transaction processing, is rarely ideal for sophisticated analyses ○ Missing values and inconsistencies ○ Data from outside sources can be used to add value ○ Data format is not designed for data mining ○ We call this 'dirty data' - Solution is to extract data into data warehouse or data mart ○ Production data is extracted, cleaned and prepared for BI processing ○ Prepared data is stored in data‐warehouse database using purpose designed data‐ warehouse DBMS

Risk Mitigation (Reduction)

- Organisation takes concrete actions against risk - Implement controls and develop recovery plan (business continuity) - There, we can say (IS) security comprises: ○ Risk Management ○ Business Continuity - Three Strategies for risk mitigation: 1. Risk Acceptance i. Accept the potential risk - no controls 2. Risk Limitation i. Reduce the risk via controls - an 'active' defense policy 3. Risk transference Move the risk to a third party

ERP Risk Factors (again - note that only one is 'technology' based)

- Organizational factors ○ Changes in scope - 'scope creep' ○ Sufficiency of resources ○ Custom design - increases complexity of project - needs to be balanced ○ Departmental conflicts - senior stake‐holders not in agreement ○ User experience - use of external consultants - local IT must be prominent - Management support ○ Changing requirements and scope ○ Lack of commitment - User involvement ○ Lack of commitment - change management focus ○ Ineffective communication ○ Conflicts ○ Inadequate familiarity with technologies - Project management - need for a successful methodology ○ Size and structure ○ Control functions - Project deterioration ○ Continue pouring resources into sinking ships - Technologies/Software issues ○ Developing wrong functions, wrong user interface ○ Problems with outsourced components Problems with current infrastructure

ERP Information Systems

- Original (first generation) ERP systems: manufacturing (materials management, inventory control, order entry & distribution) - DID NOT EXTEND to other FAIS such as sales & marketing, NOR TO customer relationship management (CRM) - ERP II systems are interorganizational, i.e., Web‐enabled system of integrated software that links between a company's key business systems and its customer, suppliers, distributors, etc. - Available in "modules" - this enables flexibility for the business because ERP usually means lots of internal redesign of business processes - therefore lots of challenges, but lots of efficiency payoffs (and cost reductions) Core ERP Modules: - Financial Management - Operations Management (manufacturing) - Human Resource Management Extended ERP Modules: - Customer Relationship Management - Supply Chain Management Business Intelligence

Relationship type - lookup (for security)

- Our logical modeling identifies an 'Employee' entity - subsequently a table - However we want 'confidentiality' over certain details in this table. - We want security over the 'lookup' data - Security (confidentiality) best applied at the 'table' level - we create a new entity 'EmployeePay'

PERT (Program Evaluation and Review Technique) Charts

- PERT and CPM are very similar in their approach; however there is a key distinction between them. - The distinction relates to the way in which task durations are derived. - In PERT, three estimates are used to form a weighted average of the expected completion time of each activity, based on a probability distribution of completion times. - We can say that PERT is probabilistic whilst CPM is deterministic. - PERT Weighted Average = (optimistic time + (4*most likely time) + pessimistic time)/6

Supply chain management

- Plan, organize, and optimise the various activities performed along the supply chain in order to maintain partnerships and processes, providing an operational advantage SCM utilizes information systems - Many of them are interorganizational information systems (IOSs) - (i.e. extensive SCOPE - IOS improve information flows among two or more organisations ○ Reduce costs of routine business transactions ○ Improve quality by eliminating errors ○ Compress the cycle time involved in fulfilling transactions Eliminate paper processing - usually inefficient and costly

Primary and Foreign Keys

- Primary Key ○ A column or group of columns that identifies a unique row in table - Foreign key ○ Is a primary key in a different table (but not in the table in which they reside) - they are need to form relationships between/among tables

How to interpret scenarios to BPMN models

- Process Participants? - Decisions - Options/choices - Parallel tasks - Tasks/activities - Resources - Objects/process tokens (document, letter, application draft, etc)

Why Process Modelling?

- Process participants typically perform specialized activities in a process. They are hardly confronted with the complexity of the whole process. - Process modelling helps to better understand the process and to identify and prevent issues. - Process modelling towards a thorough understanding is the prerequisite to conduct process analysis, redesign or automation.

Summary of Porter's Models

- Processes and strategy are tightly related - Processes should be composed of value adding activities - Value chains are the key to maintaining competitive advantage - Understand what the value proposition is to the various stakeholders - Executives should think in process terms - create value chains that are unique, provide competitive advantage that is hard to imitate

Project Management - General Practice

- Project has: ○ Time-line ○ Scope and resources ○ Unique characteristics - aims to accomplish a singular goal - Examples ○ ISD of software for an improved business process ○ Construction of a building or infrastructure ○ The relief effort following a natural disaster ○ Expanding sales into a new country, region or geographical market - Definition ○ Project management (PM) is the application of knowledge, skills and techniques to execute projects effectively and efficiently. ○ Project management (PM) is a strategic competency for organizations, closely linking project results to business goals. Project management - done well - supports competitive strategy for an organisation

Strategic Information System (SIS)

- Provides a competitive advantage by helping an organisation implement its strategic goals and increase its performance and productivity - Use Michael Porter's competitive forces model ('the five forces model') to analyze an organization's competitiveness and to design general strategies.

The push model versus the pull model

- Push model (make‐to‐stock): ○ Companies make products based on sales forecasts (accuracy?) ○ Closely aligned with mass production strategy ○ Incorrect forecast results in over‐ or underproduction - Pull model (make‐to‐order) ○ Companies make products based on customer orders Closely aligned with mass customisation strategy

Other issues: Query languages

- Query languages are used to request information from a database. - It is a language used by staff and software applications) - we want an international language for interoperability across all vendors of databases in the business world - Structured query language (SQL) ○ The most popular query language (internationally standardized) ○ Allows users to perform complicated searches using relatively simple statements or key words → SELECT (specifies a desired attribute, e.g. E-mail) FROM (specifies the table to be used, e.g. Student_Table) WHERE (specifies conditions to apply in the query, e.g. Family_Name = "Harris") We do not go further into SQL

Business Process Re-engineering (BPR)

- Radical change, fundamental rethinking, no incremental improvement. While a radical approach may be justified in some situations, it is clear that many other situations require a much more gradual (incremental) approach. - The radical change could not be supported with available technology - High risk, high cost, make or break, increased failures - Concept misuse: In some organizations, about every change program or improvement project was labelled BPR even when business processes were not the core of these projects.

Competitive Advantage Strategies

- Red Ocean - Blue Ocean

SCRUM Role: SCRUM Master

- Represents management to the project - Responsible for enacting Scrum values and practices - Ensure that the team is fully functional and productive - Enable close collaboration and cooperation across all roles and functions Shield the team from external interferences

SCRUM

- Scrum is an agile process that allows us to focus on delivering the highest business value in the shortest time - It allows us to rapidly and repeatedly inspect actual working software (every two weeks to one month). - The business sets the priorities. Teams self-organize to determine the best way to deliver the highest priority features - Every two weeks to a month anyone can see real working software and decide to release it as is or continue to enhance it for another sprint - Requirements are captured as items in a list of "product backlog " - No specific software engineering practices prescribed - Scope of each sprint is frozen (but can be reduced if necessary) - Time period is kept constant, a constant duration leads to a better rhythm for the project - Product (to be delivered) is designed, coded, and tested during the sprint - Rather than doing all of one thing at a time, scrum teams do a little of everything all the time - No changes during a sprint ○ A sprint duration is planned based on estimates of how long a team can commit to keeping change out of the sprint

Project Manager (PM) : competencies & characteristics

- Short supply and always in demand - PMs are organized, passionate, goal-oriented, team oriented - PMs recognise project commonality and strategic worth - PMs are change agents and comfortable with complexity in dynamic environments - PMs handle pressure well - complexity in dynamic environments - PMs - at ease with high abstraction and detailed analysis PMs actively cultivate people skills among all stakeholders

Entity-Relationship Diagram - fundamental definitions

- Shows Entities and their Relationships ○ Entities are rectangles ○ Lines are relationships - Cardinality ○ Number of entities that can be involved in a relationship ○ Represented by a single line or crows foot - Existence/Modality ○ Whether the entity is required or not ○ Represented by an vertical line or oval - can be zero (o) or one (1)

eXtreme Programming (XP)

- Software development - heavily used as part of SCRUM - An 'agile' methodology - Takes the best practices of software development and extends them "to the extreme" ○ Focus intensely on proven industry practices ○ Combine them in unique ways to get better results - XP fits nicely within SCRUM (REMEMBER FOR SCRUM - "no engineering practices specified" Done in the sprint

Supply Chain Management (SCM)

- Supply Chain Management: Managing upstream and downstream flows of products from raw material provider to manufacturer, then to retail and to customers. - Focus on value-adding activities only

SCRUM Requirements Analysis

- Team selects items from the product backlog they can commit to completing ○ Sprint backlog is created ○ Tasks are identified and each is estimated ○ Collaboratively, not done alone by the Scrum Master High‐level design is considered - work estimated firstly in story points, then in hours of work required for completion

SCRUM Ceremony 1 - Sprint Planning

- Team selects items from the product backlog they can commit to completing - Sprint backlog is created ○ Tasks are identified and each is estimated ○ Collaboratively, not done alone by the Scrum Master High‐level design is considered - work estimated

Data model complete, then physical build is then undertaken

- The physical data model visually represents the actual database and it is platform specific. It means that the physical model can be as the database which the model was designed for. - For example, if a physical model is designed for SQL Server then it cannot be implemented into ORACLE simply because the data structures are database specific and its data types will work working only on the targeted DB.

Artifacts - Product Backlog

- The requirements - A list of all desired work on the project - Ideally expressed such that each item has value to the users or customers of the product - Prioritized by the product owner - Reprioritized at the start of each sprint Change is welcome!

SCRUM - Themes

- The vision is then decomposed into functional parts - "themes" - high-level logical groupings of similar work - Our vision is: "A mobile app where busy workers can quickly order a value-priced, nutritional, tasty lunch for delivery or instore pickup" - Our expansion into themes could produce: ○ Customer profile - customer details ○ Order details ○ Payment data ○ Delivery choice - Themes help the team to ○ Generate further ideas of what needs to be developed Provide efficiency and risk management (e.g. security)

SCRUM - User Stories

- Themes and features - still too abstracted - too big for a team to deliver in small timeframes - Features decomposed into several user stories - A user story tells the team about (one way) the product will be used - A user story is a Product Backlog Item (PBI). - A user story is: ○ Independent - delivered separately from other user stories and has value by itself ○ Negotiable - it can be rewritten - changed - cancelled at any time until the story is committed for work (Scrum Backlog) ○ Valuable - it has worth to the business/Product Owner ○ Estimable - story is describable in some work load unit ○ Small - must be completed in one sprint ○ Testable - it tells enough information to allow test development Each user story must have acceptance criteria (AC) - a powerful tool to reduce errors in getting a story completed.

Within the area of data modelling, define "conceptual model", "logical model", and "physical model". Who does each of these models?

- This is the sequence followed in designing and building a database. - A conceptual model is the definition of the major categories of information in the database (we shall call these entities) and the relationships connecting these categories. - Logical Model takes the conceptual model as input and adds the characteristics or attributes to the entities. - The physical model (done by the programmers) takes the logical model and implements it on some target platform (e.g. SQL Server or an Oracle database)

Solutions to System Development Difficulties

- To solve this problem, development methodologies have emerged. - The Systems Development LifeCycle (SDLC) is at the centre of the most common development approaches ‐ there are many different approaches/methodologies: ○ Basic tasks are combined into phases of systems development ○ This week: Waterfall model, AKA (Plan‐driven model, Classical model)

Slack time or float time

- Total slack or total float is the amount of time an activity may be delayed from its early start without delaying the planned project finish date - We need the critical pass method (CPM) to calculate float/slack time - A forward pass through the network diagram determines the early start and finish dates - A backward pass determines the late start and finish dates Slack/float time is an important indicator of how we may alternatively deploy resources

Problems with SDLC

- Traditional SDLC / Waterfall / Plan‐driven / Classical model ○ Linear sequence of non‐repeated phases (however: iteration is good, cornerstone of collaboration) ○ It rarely works smoothly, causing development team to go back and forth, raising costs (by how much is the real question) and delaying project - Requirements documentation difficulty ○ Business requirements sometimes change making documented requirements incomplete or obsolete (too much time/effort on 'planning' OR plans have a short life (a common statement in systems development) ○ "Analysis paralysis", projects spend so much time on documentation that it hampers progress ○ With large systems, it is a huge job to definitively complete all planning as the very first stage of the project (frequently it is an impossible job) - Scheduling, planning and budgeting difficulties ○ Time and cost estimates for large project are usually way off ○ Very difficult to plan every detail (at the start) of a project - DO WE NEED TO PLAN THE TOTAL PROJECT?

Pair Programming in XP

- Two programmers sit together in front of a workstation ○ one enters code ‐‐ Helm - keyboard and mouse doing implementation ○ one reviews the code and thinks ‐‐ Tactician -thinks about the implications and possible problems - Second most important practice after tests - Pairs change continuously (few times in a day) ○ every programmer knows all the aspects of the system ○ a programmer can be easily replaced in the middle of the project - Costs 10‐15% more than stand‐alone programming Code is simpler (fewer Lines of code) with less defects (15%)

SCRUM Role: SCRUM Team

- Typically 5‐9 people - Cross‐functional: ○ Programmers, testers, analysts, user experience designers, etc. - Members should be full‐time ○ May be exceptions (e.g., database administrator) Teams are self‐organizing - Highly cooperative and collaborative

Decision Trees (data‐mining)

- Unsupervised data‐mining (apply technique, observe results, then create hypotheses/rules - Hierarchical arrangement of criteria that predict a classification or value - Select attributes most useful for classifying something based on some criteria that creates disparate groups ○ The more different (or pure) the groups, the better the classification

SCRUM - Story Estimation

- User story - how much work - we need to quantify/estimate - Two kinds of estimation: ○ Actual estimation - "hard" data - very specific ○ Relative estimation - "comparison" data - a general idea of size - SCRUM uses both types of estimating - Relative estimation used to provide a quick approximation of user stories (Story A compared with Story B - with Story C etc) - Story points are the unit of measure to convey the relative size of user stories (Story A : 25 points, Story B : 16 points) - Story points are quickly mastered by SCRUM teams - then they are quickly used by SCRUM teams. Later on - we must be more precise about estimating actual work

SCRUM - Vision

- VISION - The product owner firstly defines the minimum viable product (MVP) ○ The vision is defined before any work really begins by the SCRUM team ○ Vision enables SCRUM team to initially buy into the idea of the product ○ In some cases, the MVP enables early delivery of a minimal product for feedback and to mitigate the risk of scope creep. Example Vision (MVP): "A mobile app where busy workers can quickly order a value-priced, nutritional, tasty lunch for delivery or in-store pickup"

Logically Designing the Database

- Values in one table may relate to rows/records in other tables - Primary Key ○ A column or group of columns that identifies a unique row in table ○ Each table must have a primary key (remember - one or more fields) - Foreign keys ○ Keys of a different table than the one in which they reside - they are need to form relationships between/among tables - Relational databases ○ Databases using tables, keys, and foreign keys - and presented to the user as a two dimensional table

Solutions to supply chain problems

- Vertical integration ○ A business strategy in which a company purchases its upstream suppliers to ensure that its essential supplies are available as soon as they are needed. - Using inventories ○ Just‐in‐time (JIT) inventory system ○ Minimise inventory by delivering the precise number of parts to the assembly line at precisely the right time - Information sharing ○ Enable vendor‐managed inventory (VMI) strategy Supplier manages the inventory - many strategies based on wireless technology and RFID technology.

Requirements Analysis

- Waterfall - requirements all defined in a single phase: ○ This means all requirements identified ○ Each identified requirements then described completely ○ Very change "unfriendly" - a huge planning and analysis exercise - SCRUM - requirements are analysed incrementally - even throughout all the sprints: ○ The product backlog identifies the requirements of the product owner - very high level of abstraction - not much detail ○ These are prioritised on the basis of value-adding to the business ○ The highest prioritised requirements - these move to the "sprint backlog" - these are then "expanded" This incremental requirements analysis done across all sprints - across the whole project.

Waterfall Model

- Waterfall model (for systems design) ‐ comprises one iteration of the SDLC five phases (also known with 6 or 7 phases/stages) ○ Systems definition - systems planning stage § Management's statement defines new system ○ Requirements analysis § Identify features and functions ○ Design, development, testing (hardware, software and networks) § Based on approved user requirements ○ Implementation § Implement, test, and install new system ○ Maintenance § Fix errors, add new features, maintain the system

Business Intelligence - a Logical Architecture (operational / BI)

- We have the operational databases - mission critical, extremely busy, doing online transaction processing (OLTP) or - more traditionally - batch processing - We cannot simply position BI, which needs (intensive) online processing, to directly work with the operational databases. - We pursue a compromise - we copy (at the appropriate times - e.g., night, quiet operational times) the operational database content into another databases (a BI database), and then the BI can work with this database/architecture.

Dependencies in 2NF

- all non-key attributes must be fully dependent on the primary key - this means no partial dependencies. We need to define dependency in this context - Full dependency : the non-key attribute is completely determined by the ENTIRE primary key (single or composite) - Partial dependency: when one of the primary keys determine another attribute or attributes - Transitive dependency : the primary key is a determinant for another attribute, which in turn is a determinant for a third attribute (these are not relevant for 2NF)

Benefits of BPM

- increased customer satisfaction - Improved employee satisfaction - Improved operational efficiency - Mapping and analysing end-to-end processes facilitates communication and planning - Improved compliance with standards(service, production and strategy) - Cost and quality management - Improved cycle time (reduced) - Improved visibility of processes and functions - Provide decision support in: analysis, process/plan instantiation and reengineering.

Cross‐Functional Processes

-Activities among many business departments -Eliminates or reduces isolated systems and data -Example is Customer relationship management (CRM)

Information Systems Development Requirements

-Unlike software, systems development is never 'off‐the‐shelf', must construct or adapt procedures to fit the business and people who use the software - Systems development requires more than programming and technical expertise. - System development requires: ○ Business process knowledge and management skills ○ Technical skills AND non‐technical human relations skills, interview and group dynamics skills ○ Knowledge of business activities ○ Skills to develop job descriptions and to train staff ○ Collaboration between business and technology specialists: sometimes seeming to speak different languages!

SCRUM Ceremony (4): The Daily SCRUM meeting

1. Daily, 15‐minutes, Stand‐up (literally), Not for problem solving. 2. Whole world is invited - Only team members, ScrumMaster, and product owner can talk

Problems with Functional Application Information Systems (FAIS)

1. Data is duplicated because each functional application has its own database 2. Business processes disjointed because supporting applications separated • - Difficult for activities to reconcile data and increases chances of errors 3. Lack of integrated enterprise information - END RESULT: Inefficiency and increased costs DUE TO THE ABOVE ISSUES SOLUTION: Joint the FAIS - we say we integrate the systems

System Definition

1. Define the goal of the new system - ensure ALIGNMENT WITH BUSINESS ○ Defined so as to facilitate competitive strategy ○ To identify supporting business processes, or ○To improve decision making 2. Define the scope of the new system - ○ Defined by customers, users involved, Business processes impacted, physical location (where boundary is), functional area (what is the boundary - in terms of business functions) ○ A clear definition of scope simplifies: § Requirements determination (the next phase § Development work (e.g. describes what other systems will be relevant - most important - many other stakeholders within the organization 3. Assess Feasibility ○ Cost / Economic feasibility (i.e. the financial cost) § Approximated, "back‐of‐the‐envelope" analysis § Purpose: eliminate infeasible ideas as soon as possible § Net present value (NPV), return on investment (ROI), break‐even analysis, business case. ○ Schedule feasibility (i.e. the timetable) § Difficult to determine but a rough estimate is needed ○ Technical feasibility (i.e. can we build/run/maintain this) § Is the proposed system able to be built using existing information technology? ○ Organisational/cultural feasibility (i.e. will the staff use this) § Does the proposed system fit the customs, culture, charter and legal requirements of the organisation? ○ Legal feasibility § Measures how well a solution can be implemented within existing legal and contractual obligations 4. If deemed feasible, a project team is created ○ Normally includes IT personnel AND users ○ The team typically includes: § Manager(s) - Systems analysts (business analysts) § IT professionals with a knowledge of business and technology § Programmers, architects and software testers Users - Critical throughout the entire SDLC process.

PM Scheduling Work

1. Develop a Work Breakdown Structure (WBS) ○ A list or hierarchy of activities and tasks. ○ Used to estimate the work to be done in a project or iteration 2. Estimate effort and identify dependencies for the tasks ○ Task effort is task completion time ○ Task dependency - sequencing of tasks - which tasks must be completed before another task can start 3. Critical path ○ A sequence of tasks that can't be delayed without causing the entire project to be delayed Calculate slack time

SCRUM Ceremony (3) : Sprint retrospective

1. Periodically take a look at what is ‐ and is not working 2. Typically 15-30 minutes. Done after every sprint

SDLC 2 Approaches

1. Predictive ○ Waterfall Model, ○ Thinking it is possible to plan the project completely in advance ○ Requirements are well understood and/or low technical risk ○ Very little possibility of change 2. Adaptive ○ Uses iteration (repeating or looping over phases) ○ Used when the requirements are less certain and the project will need to react to changes. ○ Requirements are uncertain and/or high technical risk ○ Scale of project isn't fundamentally a factor in choosing the approach

Systems Development ‐ Difficulty

1. Problems: Many projects are not finished, over budget, over time or do not accomplish their goals a. Nike example in reading b. Qld Health Department example 2. May produce good 'software' but do not work to users' expectations - this mismatch is very difficult to solve - usually falls under next category 3. Difficulty of requirements determination (a moving target) ○ What features do you want? ○ Do you really need them? ○ Do we really know what we need? ○ How do we prioritize these? - The bigger the system and the longer the project, the more requirements are likely to change - how do we deal with change? ○ Time lines are 'collapsing' 4. Scheduling and budgeting difficulties ○ Often these have to be done many times until there is general agreement ○ How long will it take to design and build the system? ○ How long to do testing? ○ How long to develop and document procedures? ○ On the financial side, how much will it cost and what is the rate of return? 5. Changing technology and business operational/regulatory environment (there is a diverse environment within and surrounding business) 6. Diseconomies of scale - Adding more people to a project makes the project later - Some tasks simply can't be quickened up ‐ schedules can be compressed only so far

Normalisation ERD Process

1. Table with Multivalued Attributes - Remove Multivalued Attributes 2. First Normal Form (1NF) - Remove partial dependencies 3. Second Normal Form (2NF) - Remove transitive dependencies 4. Third Normal Form (3NF)

SCRUM Ceremony (2): sprint review

1. Team presents what it accomplished during the sprint. Whole team participates 2. Typically takes the form of a demo of new features Informal (2‐hour prep time rule, No slides)

Process

A collection of events, activities and decisions that involve a number of actors and resources that collectively lead to an outcome that brings value to an organisation's Customers.

CRM Customer‐facing applications

Applications that support direct interactions with customers: - Customer service and support (automate service requests, complaints, product returns, and requests for information) - via customer interaction centres (e.g., the call centre) - Sales force automation (automatically records all the components in a sales transaction process) - Marketing (identify/target best customers, generate quality 'leads' for the sales teams) - Campaign management ○ Cross‐selling: Offer related products based on customers' previous purchases ○ Up‐selling: Offer higher‐value related products or services as opposed to or along with the consumer's initial product or service selection ○ Bundling: Selling a group of products together at a lower price than the combined individual product prices A form of cross‐selling

Benefits and limitations of ERP systems

Benefits: - Make organisations more flexible, agile, and adaptive - Improve managers' ability to make better, more timely decisions - Improve quality of customer service, production, and distribution - In overview $$$$ efficiency - high reward Limitations: - May require organisations to change existing business processes to fit the predefined business processes of the ERP software ○ The 'requirements' analysis for this is difficult ○ The collaborative management for 'whole of business' change is complex ○ Employee resistance (change is unwelcome) is considerable - THEREFORE: Implementing ERP can be complex, expensive, and time consuming - VERY RISKY In overview - high risk

Business Intelligence (BI) ‐ rationale

Businesses collect massive amounts of data - Millions of emails and messages sent each second - Storage capacity is becoming almost unlimited, so businesses collect more data at little extra cost - Need to provide the right information to the right person at the right time (too much information is a problem) The data can show patterns and changes to established trends - These patterns are not always easily recognized - Those relationships can yield valuable information that can help businesses make better decisions (e.g. about customers) - Can help forecast changes or with areas such as customer relationships management - allows business to 'get closer to clients'

How do businesses survive a competitive world?

By knowing: - What they do in this business - Where are they standing in market - Why are they here - Where could they be - How can they get there - What do they need to do

Information System (IS)

Combination of: - Information Technology - Data - Information - Knowledge - Users/people/procedures

Porter's Value Chain

Core and Support Processes

The Data Mart, and How Does it Differ from a Data Warehouses

Data Warehouse - Repository of data ready for use by data analysts - Managed by data managers who may not be knowledgeable about the business functional areas Data Mart - Collection of data - Extracted from data warehouse to address particular functional needs - Smaller than data warehouse - Users are knowledgeable analysts for specific business function

Corporate management of data - Goal

Decision-making must have high quality data (accurate, complete, timely, consistent, accessible, relevant, concise)

Customer Relationship Management

Defining Customer relationship management (CRM) - An organizational strategy focusing on satisfying customers by assessing their needs for both products and services and by providing quality services - Maximize the lifetime value of a customer ○ Customer's potential revenue stream over the years - Minimize customer churn (losing customers) The customer relationship management process The overall process comprises: 1. Involves Marketing efforts (soliciting prospects from a target population of potential customers 2. A certain number of prospects make a purchase ‐> become customers 3. A certain number of customers become repeat customers 4. Repeat customers are segmented ‐> a) low‐value; b) high‐value The overall goal: maximize the lifetime value of a customer (i.e. the potential revenue stream over a number of years

Critical Path Method - the "backward pass"

During the "backward pass", for any activity with 2 or more successors, its late finish is the earliest late start of its successors (opposite of forward pass).

Critical Path Method - the "forward pass"

During the "forward pass, for any activity with 2 or more predecessors, its early start is the latest early finish of its predecessors.

Entity-Relationship Diagram - fundamental development approach

First we development the preliminary data model: - We identify entities and relationships - we engage all parties involved in the project - With this information, the BA creates the preliminary data model (an iterative process) - The preliminary data model does not show the detailed structure of attributes and the data types of the attributes - The preliminary data model may also show relationships that will need to be 'redesigned' before the physical build can be performed (e.g. many to many relationships) Now we expand the conceptual model: - Conceptual model - its correctness can only be confirmed by the users. That is, the users/stakeholders determine the data model - not the analysts/technologists - Now we expand this conceptual model. This is a very important because this model clearly represents the business requirements and data structures that are required for the system. - The attributes of the entities and their data types are identified however the (data) types are platform independent (we do not consider these). - It is also very important to ensure our relationships are workable when we move to the physical build (many to many relationships are not workable in any relational DBMS) - This 'view' of the data model - its correctness can only be confirmed by the users. That is, the users determine the data model - not the analysts/technologists - The relationships show the cardinality (the minimum and maximum of the numbers of the relationship)

Systems Maintenance

Fixing or adapting system - Very costly stage - frequently more than 50% of overall project cost - Patch ○ Applied to all copies of a commercial software product ○ Usually bundled as 'service packs' - Minor enhancements ○ Adaptation to new requirements done via service packs - Major enhancements ○ Usually result in new version of software product ○ Start of a new cycle of SDLC - Failures Hardware and database failures must also be fixed

Porter's Competitive Strategy model

Four competitive strategies: - Cost Leader 1. Broad cost leadership across industry (most efficient) - No one beats you on price. 2. Narrow cost leadership focused on particular industry segment (most efficient) - Differentiation 3. Broad differentiation across industry (most effective - you stand out) 4. Narrow differentiation focused on particular industry segment (most effective

Functional area information systems

Functional Area Information Systems (FAISs): - Designed to support a functional area by increasing its internal effectiveness and efficiency - Provide information mainly to lower and middle‐level managers in the functional areas via a variety of reports - Each supported by its own database Examples: - Information systems for accounting and finance ○ Financial planning and budgeting ○ Managing financial transactions ○ Investment management ○ Control and auditing - Information systems for marketing ○ A successful organization must understand its customers' needs and wants in order to develop its marketing and advertising strategies around them. - Information systems for production/operations management (POM) - Information systems for human resources management Manage salaries, benefits, staff recruitment

PM Visualising Work Schedules

Gantt Charts - A bar chart - describes the schedule by the length of horizontal bars superimposed on a calendar - Shows task, duration, start date, predecessors - Show the critical path - and all noncritical paths and member tasks - Usually not suitable for resource planning (duration per bar - no information about required capacity) Burn Down Charts - Shows how much work is remaining to be done in the project - Widely used in agile ISD and SCRUM - Vertical axis - plot of work remaining - Horizontal axis - plot of time - Each point - how much left to do at the end of that point in time Burn Up Charts - Shows how much work has been completed and the total amount of work - Two lines - completion when lines meet • A total work line (project scope line) • A work completed line - Vertical axis - amount of work - Horizontal axis - plot of time - Each point - how much completed at the end of that point in time - Advantages over burn down charts • Shows added or removed work Shows more clearly the completion date

Business the Big Picture

Industry -> Competitive Strategy -> Value Chains -> Business Processes -> Information Systems

How does Information Systems help businesses to survive and compete?

It helps them to achieve: - Operational excellence - Process excellence >> Business processes - New products (or supporting), services, and business models - Customer and supplier relationship - Improved decision making (data based decision making) - Data analytics and tracking

Risk Management

It must consider the following factors: - Which assets are at risk (i.e. identify all assets - people, data, IT) - To what threats are those assets exposed - What safeguards/controls can be used to protect the assets (a control is anything that reduces risk) ○ CONTROLS ALWAYS COMPRISE GOOD POLICY (FIRST), TECHICAL ENHANCEMENTS, EDUCATION/TRAINING - What is the resulting residual risk level - can the business live with this residual risk or must we attempt to control the risk level down further? Risk Assessment determines what should be done to reduce/mitigate the risk

Implementation - 4 Strategies

Pilot: - Organisation implements entire system on single, limited unit - If systems fails, it only affects limited boundary - Reduces exposure Phased: - New system installed in phases - Tested after each phase - Continues until installed at entire organisation - Can't be used in tightly integrated systems Parallel: - New system runs in parallel with old system during testing - Expensive and time consuming - Data must be entered twice - Provides easy fallback position - excellent verification of results - REDUCES RISK Plunge: - Direct installation - Install new system and discontinue old - There is no backup position - HIGH RISK

What are processes

Processes are: - The way you manage your business, company, organization, - The way you provide service or produce a product, - The way you deliver value, - The way you meet your targets, - The way you achieve your objectives, and much more. - Processes are the way an organization realizes its strategic intent.

RFM Analysis Classifies Customers - a Reporting Application

RFM Analysis - RFM program analyses and ranks customers according to their purchase patterns - Determines: ○ How recently (R) a customer has ordered? ○ How frequently (F) a customer has ordered? ○ How much money (M) a customer has spent per order? - Produces an RFM Score ○ RFM program first sorts customer records by date of most recent purchase and scores each customer 1 to 5 (score 1 may be top 20% of 'recent' purchases, score 5 may be bottom 20% of 'recent' purchases) ○ RFM program then resorts customers by how frequently they order and scores each customer 1 to 5 RFM program finally sorts the customers according to the amount of money spent and scores each customer 1 to 5

ERDs - further analysis of entities and relationships

The general format of an 'entity' is shown to the side: - EntityName - the major theme - e.g. 'student' - will be a table name in the operational database. - Primary key - one or more attributes (composite) - must be unique and never changing. Can be a 'natural' key (e.g. ISBN) or a 'surrogate' key (e.g. StudentID) - Attributes - the characteristics of an entity - with their (data) types - Key Type - primary and foreign - Type - (1) domain, (2) linking, (3) lookup, (4) weak type

The structure and components of supply chains

Three segments of supply chains: 1. Upstream - Sourcing or procurement from external suppliers - Select suppliers; develop the pricing, delivery, and payment - Manage inventory, receive and verify shipments, transfer goods to manufacturing facilities 2. Internal - Packaging, assembly, or manufacture products - Schedule activities necessary for production, testing, packaging, and preparing goods for delivery - Monitor quality levels, production output, and worker productivity 3. Downstream Receive customer orders, develop a network of warehouses, select carriers, and generate invoices - Tiers of suppliers: ○ A supplier may have one or more sub‐suppliers ○ The sub‐supplier may have its own sub‐supplier(s) - Supply chain flows ○ Material flows are the physical products (raw materials, supplies, etc.) that flow along the chain § Include reverse flows (or reverse logistics): □ Returned products, recycled products, and disposal of materials or products - Information flows: consist of data related to demand, shipments, orders, returns, and schedules Financial flows involve transfer of money, payments, credit card information, etc.

Transaction processing systems

Transaction - Business event that generates data worthy of being captured and stored in a database Transaction processing systems (TPS's) - Usually fundamental - for the whole business - Monitor, collect, store, and process data generated from all business transactions - Collect and store data (in a database(s)) continuously (real time) - Absolutely 'mission‐critical' - 24/7 - no 'unplanned' 'outages', precisely planned maintenance 'downtime' - high availability (99.999% uptime - the 5 nines) - Usually simple operational logic (i.e. the logic for the transaction) - Provide inputs to other (functional area & business intelligence) information systems (via 'common' database storage) - Must be able to handle high volume of data efficiently - Must avoid errors and downtime, record results accurately and securely, and maintain privacy and security - Process data using the following techniques: - Batch processing ○ Stored data from TPS are grouped into batches. Organizations then prepare and process the batches periodically (e.g., hourly, nightly) - Online Transaction Processing (OLTP) - dominant paradigm Business transactions are processed online as soon as they occur (REALTIME)

Business Intelligence Systems - a definition:

○ An information system: this means that when business people use the term 'BI', they are talking about software, data and people ○ Provide information for improving decision making ○ Vary in characteristics and capabilities Vary in the way they help foster the competitive advantage of a business - BI is a strategic capability for modern business.