Information Systems for Managers

Information Systems for Managers

This document is authorized for internal use only at IBS campuses- Batch of 2012-2014 - Semester I. No part of this publication may be reproduced, stored in a retrieved system, used in a spreadsheet, or transmitted in any form or by any means - electronic, mechanical, photocopying or otherwise - without prior permission in writing from IBS Hyderabad.

C HAPTER 1

Introduction to Information Systems

Source: http://www.imi-groups.com

S ECTION 1

Basics of Information Systems

Video 1.1.1 : What is an Information System? An Information System (IS) is a system that accepts inputs in the form of data resources, processes them and provides output in the form of information. Information systems are designed in such a way as to help the managers analyze data and to enable decision-making.

Need for Information Systems Information systems carry out certain functions that would help in data analysis and decision-making. Some of the important functions carried out by information systems are as follows: Accepting input in the form of data resources

Video 1.1.2: An Introduction to Business Information Systems

These resources have been briefly explained below: Figure 1.1.1: Information System Components

Processing the data resources into information products Storing the data resources Generating output Controlling the performance of the system components of Information Systems The IS components include people resources (end users and IS specialists), equipment (hardware and software resources), data resources (data and knowledge bases) and network resources (communications media and network support). These resources carry out the input, processing, output, storage and control activities, and convert the data resources into information products. Figure 1.1.1 represents the various IS components. It provides an outline that focuses on the five basic resources of information systems namely people, hardware, software, data and networks. Source: Jessup Leonard M. and Joseph S. Valacich. Information Systems Today. New Delhi: Prentice-Hall of India Private Limited, 2005. Pg 5.

Video 1.1.3 : Business Information Systems

Video 1.1.4 : How Systems Can Help Your Business

S ECTION 2

Business Perspective of Information Systems

Video 1.2.1 : Business Perspective of IS - 1 Information systems are designed in a manner that helps managers analyze data and make decisions. Some of the important functions carried out by information systems are accepting input in the form of data resources, processing the data resources into information products, storing the data resources, generating output and controlling the performance of the system. Information systems help an organization perform various functions, solve business problems and pursue business opportunities.

BUSINESS PROCESSES AND ISs Information systems can be used by businesses to achieve strategic advantages by improving production methods and by developing new products and services. Following are some of the strategic advantages that a company can gain through the use of information systems:
Video 1.2.2: Business Perspective of IS - 2

services and develop innovative products and/or services on a regular basis. Maintain an information database about the customers. Target the customers based on their previous purchases and sell this information to other retailers. Global expansion. Some of the other advantages that an organization can gain from using information systems are discussed in detail as follows: Improvements in Business Processes Information systems can be used to develop products, services and other competencies that will enable companies to achieve strategic advantages. The use of information systems helps in streamlining the operational and managerial p r o c e s s e s . B y Source: http://technosysint.com/ improving their business processes, organizations can cut costs, improve quality and customer service, and develop innovative products. The manufacturing process can be automated; computers are used in design, production
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Enhance the efficiency and effectiveness of business operations. Create entry barriers to other competitive firms. Encourage the suppliers to do business with it and attract customers to buy its products and/or services. Strengthen the organizations relationships with the suppliers.
Source:http://img.ehowcdn.com/

Enhance the existing products and/or services, customize the products and/or

and engineering, in addition to the management of resources. Organizations can use intranets, extranets, Internet and other networks to interact within and with the outside world (i.,e, distributors, customers, creditors, investors, etc). For example, information systems can be used for connecting manufacturers with dealers and suppliers. Improved business processes can enable manufacturers improve production, distribution, sales, etc.

S ECTION 3

IT Infrastructure and Computer Networks

The field of computing and communication technologies has witnessed significant developments over the last couple of decades. With the advances in communication technologies, the need for information sharing and dissemination through computer networks is being widely recognized. A computer network can be defined as an interconnected collection of autonomous computers. In simple words, a network links two or more computers and enables sharing of information between them. Computers are said to be interconnected if they are able to exchange information. They may be connected through copper wires, fiber optic cables, microwaves, or communication satellites.
Source: http://www.sanspareiltech.com/

A major goal of networking is scalability. Scalability is the ability to increase s yste m performance gradually as the workload increases. For example, a scalable network system would be one that can start Source: w i t h j u s t a f e w http://www.playgroundchildren.com nodes but can easily expand to thousands of nodes. Any device which is connected to the computer network can be termed as a node in this case. Nodes can be computers, printers, servers, routers, switches, cell phones, hubs, etc. A node has an address on the network and makes use of the computer network as a medium of communication. A computer network is a data communication system where two or more computers are linked in order to exchange data (documents, sheets, etc.) and share resources like (CD-ROM, printers, storage devices, etc.). The computers on the network can be linked through cables, radio waves, telephone lines, infrared light beams, or satellites. Depending on the usage networks can be classified into three categories: 1. Local Area Network (LAN) 2. Metropolitan Area Network (MAN) 3. Wide Area Network (WAN)

Video 1.3.1 : Computer Networking Tutorial -1

Video 1.3.2 : Computer Networking Tutorial - 2

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R EVIEW 1.1
Question 1 of 2
Which of the following statements is true about information processing at the operational level?

A. B. C. D.

A large quantity of data needs to be processed. Decisions taken are usually marked by a great deal of uncertainty. Information is usually gathered from the external environment. Information pertaining to the performance of various business units of the organization is usually required.

Check Answer

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S ECTION 4

Case Study : IT Infrastructure and Business Process Synergy at Meru Cabs Private Ltd.

Since the 1990s, there had been a phenomenal change in the Indian transportation industry. Information technology and the development of infrastructure played a vital role in bringing about this change. In India, public transport remained the primary mode of transport for a majority of the population. The demand for transport infrastructure and services witnessed a 10% growth

annually.The increasing demand resulted in the growth of Radio Taxi or Radio Cab1 operations, which provided customers with a safe, cost-effective, and highly personalized experience. Meru Cabs Private Ltd. (Meru) was one such company which used information technology to bring about a tremendous improvement in its operational efficiency and customer satisfaction.

This case study was written by Kartikeya P Bolar and reviewed by R Muthukumar, IBS Hyderabad. It is intended to be used as the basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation. The case was compiled from published sources. 2012, IBSCDC. No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever without the permission of the copyright owner.

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ABOUT THE COMPANY Meru was one of the first radio cab companies in India. The companys service was launched with 45 cabs in Mumbai in April 2007. Since then, it had grown to have a presence in the four cities of Mumbai, Delhi, Hyderabad, and Bengaluru in India. The company derived its name from the mythical mountain of the gods that symbolized unshakeable reliability. According to company sources, as of 2011, Meru had a fleet of over 5000 cabs through which it served around one million passengers a month. The company won the 'Best IT User Awards', given by NASSCOM CNBC TV-18, for three consecutive years from 2008 to 2010. BUSINESS MODEL Merus tagline Rely on us described the core value of the company the promise of reliable service to its customers. In order to deliver such a reliable service, the company had a 24x7 customer service center. To make sure that customers would have similar experiences in all its cabs, Meru bought brand new cars and ensured that it maintained the safety and comfort standards and facilities in each of them. The company took care to train the drivers in soft skills and provided them with cars containing the required facilities. The motivation for the drivers came from the fact that they could retain the earnings beyond a specified amount and the fuel cost as their personal income.

BUSINESS PROCESS The business process at Meru Cabs included managing the demand for the cabs across various areas in the four metros and also the timely delivery of the promised service to the customer. Managing the demand for the cabs required developing real-time tracking of vehicles, intelligent route planning, and also understanding the needs of the customers. Ti m e l y d e l i v e r y o f t h e s e r v i c e r e q u i r e d e ff i c i e n t communication, resource allocation, and process automation & control activities. INFORMATION TECHNOLOGIES AT MERU Meru used GPS2 (Global Positioning System) to know the exact location of its cabs. This helped the company in managing the logistics (Refer to Exhibit I for GPS at Meru). A two-way data communication link was set up using GPRS3 (General Packet Radio Service) between the vehicles and the backend system (Refer to Exhibit II for GPRS at Meru). Information such as the location, fare, distance traveled, speed, etc. could be sent to the backend system at a particular frequency. Similarly, the details of the customer whom the driver had to pick up and drop were sent from the backend system to the vehicle. The customer details were displayed on the screen in front of the driver for clarity and further ratification. Meru used RFID (Radio Frequency Identification and Detection) technology to create virtual cab queues at prime locations like airports to serve customers (Refer to Exhibit III for RFID at Meru). To manage its resources and the
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customers, Meru invested in Oracle ERP (Enterprise Resource P l a n n i n g ) , S i e b e l s C R M ( C u s t o m e r R e l a t i o n s h i p Management), and Aspect IVR (Interactive Voice Response). The various operations like dispatch of cabs and consignments were automated based on backend software with complex algorithms. As far as communication with the customer was concerned, Meru provided a user-friendly web interface where the customer could book a cab service 24 hours in advance. The customer could also track the status of the booking. Customers of Meru could pay their journey fare using debit/ credit cards in the cab itself. Meru had a tie-up with banks to facilitate card transactions (Refer to Exhibit IV for Debit Card Reader). The customer could even pay his/her fare using the mobile banking facility. The fare bill was tamperproof and given on a printed form. It was based on the tariff and the distance of the journey. Meru also tried to use technology innovatively to develop business intelligence. For instance, it could assess the driving habits, intentions, and behavior of its drivers using the technology and on the basis of this, develop specific intervention programs for the drivers . Meru intended to invest further in technology to transform its business and reach greater heights. QUESTIONS FOR DISCUSSION 1. Investigate in detail the potential business applications of the IT mentioned in the case.

2.

Develop a relationship framework between the information technology used and the business processes of Meru.

GPS AT MERU CABS

First and foremost, a GPS device (MCT Box) is built into the taxi, featuring a meter box (dashboard) and a built-in chip for the GPS with an antenna. The GPS and meter data are transmitted to the call center on the server via an antenna. A particular taxi is meant exclusively for two or three specific drivers. A login and password are pre-loaded in the GPS box. The driver has to punch in the five-digit code on the system. The moment he logs in, the server at the call center gets the message (?) that this car is accessible to take passengers. The five-digit code on the system is different for every driver and his respective vehicle. At the call center executives end, an application that consists of a map of any of the earlier mentioned six places appears. For instance, if it is a Mumbai map, the map will comprise pre-installed names of important destinations in the city and a four-colored indicator (yellow, green, red, and black). Red indicates that the car is already loaded with a passenger, green indicates that the car is vacant; yellow indicates that the car is waiting at a kerb (for a local inhabitant of one of the six places) and black indicates logged-out cars.

The shift of the driver starts based on the login. For example, if two drivers have been appointed for one taxi (one for the day shift and the other for the night), from the login to log-out time, the server automatically notes down the distance traveled by the drivers along with the number of kilometers covered to pick up the customer. As soon as the drivers log out, details of the meter, the kilometers covered, and the money earned by the drivers are automatically stored in the server through the antenna.

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Exhibit 1.4.1 Source: V-Link Taxis Innovative Meru GPS Service Doing the Rounds of Indian Roads, http://www.techshout.com/ features/2007/06/v-link-taxis-innovative-meru-gps-servicedoing-the-rounds-of-indian-roads/, October 6, 2007

Exhibit 1.4.3

source: www.12manage.com

Exhibit 1.4.4

Exhibit 1.4.2

Adapted from www.merchantservicebergen.com source: www.wiredcpu.com

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C HAPTER 2

Different Types of Information Systems

Source:http://www.octium.eu/en/index.php/information-systems/what-is-an-infor mation-system

S ECTION 1

Classification of IS by Organizational Levels

Information requirements differ and depend on the various levels in the organization. Both information and organizational hierarchy are related to each other. Figure 2.1.1 depicts the relationship between information and organizational hierarchy.
Figure 2.1.1: Information at Various Organizational Levels Video 2.1.1: Types of Under the hierarchical Information Systems classification of an organization, there are three levels namely, the operational, tactical and strategic levels. The nature of decisions made differ from one level to another. Therefore, the information requirements also differ from one level to another. Refer to Table 2.1.1 for informational requirements by various levels in the organization.

At the operational level, a large quantity of data needs to be processed. This data is usually generated by business transactions with the customers, suppliers, etc.
Source: Jawadekar W S. Management Information Systems. Second Edition. New Delhi: Tata McGrawHill, 2002. Pg 96.

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Table 2.1.1: Informational Requirements at Various Organizational Levels

MANAGEMENT LEVEL TYPE OF PROBLEMS TACKLED INFORMATION NEEDS

TIME FRAME

reports pertaining to the performance of the various business units of the organization. At this level, the plans are compared with the actual performance and remedial measures are taken in case of any deviations. At the strategic level, in addition to the information gathered from the internal sources, the decision makers would require information from the external environment. The decisions made at this level are taken in situations that are marked with a great deal of uncertainty. Based on their application in business, information systems can be classified as Transaction Processing Systems (TPS), Management Information Systems (MIS), Decision Support Systems (DSS) and Executive Information Systems (EIS). Artificial Intelligence (AI) is also used by many organizations to improve precision in production/operation or decisionmaking. With the increasing competition from domestic as well as foreign players, business organizations and their information needs have undergone a significant change. Organizations are increasingly using Information Technology (IT) to capture and disseminate information and enhance the performance of the business. This may involve improvements in the efficiency of operations, in the quality of management processes and even in the way the business is conducted or organized. Transaction processing is one of the fundamental activities of every organization. Although an information system has a very important role to play in supporting management,
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Senior Management

Strategic, e.g., We want to be the best at customer service Tactical, e.g., We will improve staff training. Operational, e.g., We will hire motivational speaker Fred Smith to talk to staff on Friday. e.g., We will set up the tables and chairs in the conference room.

Months-years

Highly summarized

Middle Management

Weeksmonths

Summarized

Operational Management

Hours-Days

Raw or slightly processed

Nonmanagement workers

HoursMinutes

Basic

Source: http://www.mckinnonsc.vic.edu.au/la/it/ipmnotes/index.htm.

At the tactical level, the concern shifts from day-to-day decisions that have a short-term focus to those which have a medium-term impact on the performance of the organization. This level requires information in the form of consolidated

ensuring control and undertaking other knowledge work, such an emphasis should in no way obscure its importance in transaction processing. Beyond such operational level processing of data, information systems have Source: http://img.gawkerassets.com/po specific applications in st/17/2012/03/shutterstock_116 the various functions of 09845.jpg an organization like marketing, manufacturing, human resources, accounting, finance, etc. Marketing information systems support marketing function like sales planning, advertising & promotion, and market research. Manufacturing information systems support production or operations function, which includes planning and control of processes by which goods and services are produced or delivered. Human resources information systems help in keeping track of the details of all employees working in the organization as well as those of new applicants. Accounting information systems record and report flow of funds and help produce financial statements such as balance sheets and income statements. Financial information systems help in allocating and controlling the financial resources within a business.

Management Information System (MIS) is a management support system that facilitates day to day operations in an organization. MIS makes use of c o m p u t e r - b a s e d Source: systems for converting http://i.ehow.co.uk/images/a06/ uq/b9/contributing-information-s data into information. ystem-success-failure-1.1-800x These systems can be 800.jpg classified into strategic, tactical and operational information systems based on the nature of the information and the decision structure. MIS supports structured decision-making, i.e., those decisions which can be described in detail. Decision Support Systems (DSS) are information systems that help the managers in decision-making. DSS are developed using analytical models, specialized databases, and the knowledge and experience of the decision makers. DSS generally supports decisions that are unstructured or semi-structured, i.e., those decisions that cannot be described or can be described only partially. Executive Information Systems (EIS) enable online access to relevant information (related to the external environment) to the top management in a comprehensible format. These systems provide timely,
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accurate and relevant information to the management. The basic purpose of an EIS is to help executives learn about the organization, its work processes and its interaction with the Source: http://www.tech-faq.com/wp-content external environment. /uploads/2009/02/Decision-SupportT h e s e s y s t e m s System.jpg mostly help the top management in taking unstructured decisions. Online Analytical Processing, popularly known as OLAP, is used for analyzing data stored in the database. OLAP includes data marts, data warehouses, data mining and multi-dimensional databases. Information systems are used by business organizations in order to achieve strategic advantages such as improving the business processes, reengineering it, becoming an agile competitor, creating virtual companies and knowledge management.

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S ECTION 2

Transaction Processing Systems & Functional Information Systems

Source: http://news.softpedia.com

Information systems that process data generated from business transactions are called transaction processing systems. In other words, the main job of a transaction processing system is to collect data generated from the transactions, store it, and, at times, control the decisions that are taken in the wake of the transactions. Such transactions can be in the form of purchases, sales, deposits, withdrawals, etc.

For instance, booking an airline ticket, withdrawing m o n e y f r o m a n AT M , depositing cash in the bank, etc., are all examples of transactions. Generally, these transactions occur on a day-to-day-basis. A sale or purchase of an item triggers many other transactions like credit checks, billing, and changes i n t h e i n v e n t o r y. T h u s ,

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transactions generate additional data. Following are the objectives of a transaction processing system: Carrying out the day-to-day transactions of the organization on a regular basis. Collecting, processing, editing, updating, storing the data, and generating the required reports or documents. Supplying the necessary information to the organization, which would enable proper functioning of the business. Providing reports and documents which would help in making timely decisions. Supplying data to other information systems. Functional Information Systems - It is important for a business end user to under stand how information systems affect a particular function say, finance, or a particular industry say, banking. This section deals with information systems that support various business functions such as marketing, manufacturing, and finance. The objective here is to give the reader an idea of the range of business information systems, which can be used by organizations. Architecture of TPS

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S ECTION 3

Management Information Systems

Video 2.3.1: Why Study MIS? MIS can be defined as an integrated, user-machine system for providing information to support managerial, operational and decision-making functions in an organization.

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According to Barry E. Cushing, MIS is a set of human and capital resources within an organization which is responsible for the collection and processing Video 2.3.2: of data to produce information Management which is useful to all levels of Information Systems management in planning and controlling the activities of an organization. For the purpose of analysis, planning, control and decision making, the system uses manual procedures, computer hardware and software, data models and a database. Information is needed at all levels within a business organization. However, its scope, content and presentation differ from one level to another. Based on the location at which information is used, it can be classified as operational, tactical and strategic information.

Architecture of MIS

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S ECTION 4

Decision Support Systems

Decision Support Systems (DSSs) are computer-based information systems that support the decision-making activities of the organization. These are interactive systems and subsystems that provide assistance to the decisionmaking team of the organization to effectively use organizational knowledge and various technologies to make decisions. The DSS provides access to all the information assets of the organization, compares the data figures, forecasts figures based on new data and hypotheses made and evaluates various decision alternatives considering the past experiences.

Source: http://www.referenceforbusiness.com

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DSSs are widely used in business organizations to provide support in activities such as financial planning, forecasting, risk assessment, etc. To arrive at a rational solution, a DSS may make use of inquiry, analysis, models, or accounting systems. They are very useful when complex manipulations and different analysis techniques need to be used to find a solution. There are basically two types of decisions programmable decisions and non-programmable decisions. Programmable decisions are those that are based on predetermined rules and can be computerized. Computerization is possible since the inputs, process methodology, analysis and choice of decisions are all predetermined. Non-programmable decisions are those that do not follow any fixed rules but are based on circumstances. Architecture of DSS

Characteristics of a DSS A DSS enables its users to solve a particular problem using the what-if analysis. Using this analysis, one can make modifications to the data related to the problem and find out the effect of these changes on the results. Thus a DSS is used for analyzing the various possibilities and deriving an appropriate strategy for each situation. Following are the characteristics of a DSS: They are computerized information systems that are interactive in nature. These systems can be used by decision makers in order to control the order of operations performed. DSSs provide support to those decision-making activities or processes that are specific in nature. They facilitate support to the decision makers in the organization, but do not replace them. They can be independent systems or subsystems of a more integrated and larger information system. DSSs as independent systems can collect or reproduce data from other information systems. A DSS is flexible so that it supports semi-structured and unstructured information. This is an essential attribute of DSSs since decisions are always based on assumptions. Decision-making may require a lot of information. For meaningful information to be made available to
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decision makers, it is necessary to store the information in databases from which data can be accessed easily and quickly. Types of DSS There are four basic types of DSS, namely data analysis systems, information analysis systems, accounting systems and status inquiry systems. These systems are described in brief here: Data analysis systems Data analysis systems are developed using simple data processing tools and business rules. These systems rely on comparative analysis, application of formula and use of algorithms. Such systems are generally used for conducting cash flow analysis and fund flow analysis. Information analysis systems Information available to the management needs to be analyzed to arrive at a result. The analyzed data is printed in the form of reports for the perusal of the decision maker. By going through these reports, the decision makers can take decisions. Such information analysis systems are used for generating sales analysis reports, market analysis reports, etc. Accounting systems Though accounting systems do not contribute directly to decision-making, they can be of great value in tracking business functions. These systems track information
Source: http://s3.hubimg.com

regarding cash, inventory and personnel. In most of these systems, predetermined standards are used. A comparison is made between the actuals and the standards. The results of such comparison help the management exercise control in the organization and

arrive at a decision. Status inquiry systems Some decisions in the operational and middle management level do not require any elaborate computations, analysis, selection, etc. These decisions can be taken easily if the current status is known. Railway reservation systems are an example of status inquiry systems. The system displays the status based on availability. Applications of DSS DSSs are very useful in analytical modeling. The four basic types of analytical modeling supported by DSS are what-if analysis, goal seeking analysis, sensitivity analysis and optimization analysis. These are discussed below:
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What-if analysis - End users can make use of what-if analysis to make changes in the variables or in the relationship amongst variables and observe the changes. The what-if analysis is used for a n a l y z i n g th e v a r i o u s possibilities and deriving an appropriate strategy for each situation. For example, the change in revenue can be studied by Source: http://us.123rf.com changing the tax rate. Managers generally use such an analysis to observe and evaluate changes. For instance, the what- if analysis is used for finding out the effect of a 5% reduction in advertising on sales. Goal seeking analysis - Goal seeking analysis is the reverse of what-ifanalysis. In goal-seek, the target is fixed and changes are made to the related variables so that the target is

achieved. For example, if the net profit is fixed at Rs. 100 million, changes can be made to the expenses and revenues in order to achieve the predetermined net profit. This is another important decision support tool. MS Excel is generally used for conducting goal seeking analysis. Sensitivity analysis - Sensitivity analysis can be considered as a type of what-if analysis in which the effect of a repeated change in a single variable is examined. Using this analysis, one can find out the impact of a single variable on other variables. It is useful when the user is not sure about the value of a key variable. There are a few DSS packages that automatically and repeatedly make minor changes to the variables. For example, the tax rate can be changed repeatedly to observe how the revenues are affected. Sensitivity analysis is used to find out how a continuous reduction in advertising expenditure affects sales. Scenario, a what-if analysis tool Source: http://latestseoupdates.files.wordpress.com in MS Excel, is used for conducting sensitivity analysis.
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Source:http://i.istockimg.com

Optimization analysis - Optimization analysis is a complex extension of goal-seeking. In optimization analysis, the target is not fixed. Rather, the target needs to be arrived at after taking into consideration the constraints involved in achieving the targets. In this analysis, one or more variables are changed after taking the constraints into account until the best alternative or the optimal value is found. Optimization analysis would require special purpose software and techniques like linear programming. For instance, optimization analysis is used for finding out the optimum amount of advertising that could be used with the given constraints of budget and the media. Solver, a what-if analysis tool in MS Excel, is used for conducting optimization analysis.

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S ECTION 5

Executive Information Systems

An Executive Information System (EIS) is a computerized information system which is designed to meet the informational requirements of the top executives of an organization. These information systems provide internal as well as external information that are significantly important for making decisions in order to meet the strategic objectives of the organization.

Source: http://image.shutterstock.com

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EIS combines the various features of the MIS and DSS. It can be considered a logical extension or form of decision support systems. Unlike DSS, Executive Information Systems are designed to draw inferences based on examples or make decisions based on predetermined logic or business rules. They were initially developed to serve the information requirements of the top management. These systems were aimed at supporting managerial learning about the organization, its work process and the impact of external environment. Information is mostly presented in graphical or diagrammatic form so that a user can understand it quickly. The format of presentation of information may also be predetermined so that reporting is standardized across the organization. The drill-down facility offered by these systems is useful when a manager wants to access details of previous analyses. EIS also helps the management focus its attention on critical issues or business problems. EIS is being widely used in areas like crisis management, strategic planning, employee relations, internal and external monitoring of resources and decision making at the executive level. It is used for providing simplified information to executives and aids in decision-making. For instance, most of the business organizations subscribe to the stock exchanges and other institutions to have access to stock market related data. Data provided by these institutions is complex and quite detailed. EIS can be used to generate reports which are

simple and user-friendly. These systems take in only the information which is appropriate and then convert/ transform that information into a simpler and more userfriendly form which will aid executives in easy understanding and quick decision-making.

Exhibit 6.2 Mycin An expert system in the field of medicine named Mycin was developed at Stanford University in the 1970s. The primary activity of this expert system was to diagnose and recommend treatment for some types of blood infections. Conventionally, it would take about 48 hours for doctors to properly diagnose a blood infection and by that time, most of the patients would die. Doctors, therefore, had to make quick guesses about the expected problems from the available data and use them to provide a covering treatment under which drugs which could deal with any problem would be given. The development of Mycin was done partly to explore how experts made these rough but important guesses based on limited information. The use of an expert tool would help junior or non-specialized doctors in the process of providing more effective treatment. Mycin used various heuristics to control the search for a solution (or proof of some hypothesis). These were required both to make the reasoning efficient and to prevent the user being asked too many unnecessary questions. The performance of Mycin was extremely good. However, it was never practically implemented. This was due to the ethical and legal issues related to the use of computers in medicine. One of the questions asked for example, was who would be sued if the system made the wrong diagnosis. Adapted from, MYCIN: A Quick Case Study, http://www.macs.hw.ac.uk/~alison/ai3notes/section2_5_5.html#SE CTION0055000000000000000.

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Architecture of EIS

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S ECTION 6

Expert Systems
Expert systems are programs designed to provide users with the expertise of professionals in a particular field. These are knowledge-based information systems that use knowledge about a specific area to act as an expert consultant to the users. These systems gain knowledge from an expert and apply this knowledge to make decisions. The knowledge base of the system consists of facts, procedural steps and rules that determine how the data is related to the solution and other relevant information. The rules are framed on the basis of the methods used by professionals for solving problems. The expert system consists of an inference engine, which is a program that enables the system to evaluate the rules in the knowledge base. It determines the set of rules that will be invoked based on the nature of the problem. For example, an expert system can be used to gain knowledge about diagnosing a disease from a doctor and this knowledge can be incorporated in the form of software, which can be used by medical students. Refer to Exhibit 6.2 on an Expert System called Mycin, which was used for conducting medical diagnosis. The process in which the expert knowledge is acquired, documented and incorporated as software is called knowledge engineering. Architecture of Expert System

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S ECTION 7

Case Study : Bumrungrads Hospital 2000 Information System

Video 2.7.1: Video on Interview with Curtis Schroeder, CEO, Bumrungrad Hospital

We are a service business and people come to private healthcare in Thailand because they expect efficiency and top quality. Information technology has always been a way to provide that. Hospital 2000 helps us get patients registered quickly, helps get their pharmacy done, helps

put information at peoples fingertips when and where they need it; helps us get the bill out accurately and quickly and that helps us to be very competitive in the very competitive healthcare market here in Thailand.1 - Curt Schroeder, CEO, Bumrungrad Hospital.

This case was written by K. Prashanth, under the direction of Vivek Gupta, IBS Center for Management Research. It was compiled from published sources, and is intended to be used as a basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation. 2004, IBS Center for Management Research. All rights reserved. To order copies, call +91-08417-236667/68 or write to IBS Center for Management Research (ICMR), IFHE Campus, Donthanapally, Sankarapally Road, Hyderabad 501 504, Andhra Pradesh, India or email: info@icmrindia.org

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Hospital 2000 is a key attribute helping Bumrungrad Hospital to maintain world class standing in medical care and service. Top quality healthcare is about getting the right information to the right caregiver at the right time and Hospital 2000 does this in world-class style. The fully computerized medical record insures that all information is available to the medical team and the service level, speed and efficiency is enjoyed by our 750,000 patients each year.2 - Curt Schroeder, CEO, Bumrungrad Hospital. INTRODUCTION In January 2003, Intelligent Enterprise Asia, a leading IT magazine in Asia, announced the Intelligent 20 awards recognizing the top 20 IT-savvy companies in the continent. In its third year, the award was given to Asian companies, which employed innovative IT solutions to enhance operational excellence and customer service capabilities. Judges from the worlds 10 leading consulting firms including IDC, Accenture and Gartner, selected the winners. One of the awardees was the Bangkok (Thailand)-based Bumrungrad Hospital Public Company Limited (Bumrungrad), Asias largest private hospital. Notably, Bumrungrad became the first hospital in Thailand and the first company in the healthcare industry to receive such an award. Bumrungrad was recognized for successfully implementing the Hospital 2000 information system (IS). The Intelligent 20 award was only one of several awards

Bumrungrad received for its Hospital 2000 IS (Refer Exhibit I for other awards). In February 2003, CIO Asia magazine included Bumrungrad in its list of top 100 companies for its foresight in deploying an advanced hospital information system (IS). Like most of the IS deployed by Asias leading hospitals in the late 1990s, Bumrungrads system mainly addressed the needs of the accounting and billing departments. The hospitals IT operations were scattered across four systems, running various mutually incompatible applications. This meant Bumrungrad had to put more staff on board for maintenance. Due to the incompatible applications, hospital staff could not access the latest patient data quickly, causing inconvenience. Hence, Bumrungrad was looking out for an advanced hospital IS which could address several needs at one go. This included simplifying its internal operation (primarily billing) by connecting all applications from the pharmacy to eating outlets to the patients medical treatment, so that consolidated medical bills could be generated instantly. Bumrungrad also wanted the IS to enable foreign patients of different nationalities to receive necessary information in a language of their choice and be able to book appointments and accommodation online. It also wanted the IS to facilitate quicker treatment for its patients at clinics within the premises, and in the process, save the hospitals time and money in administering medical services. All these requirements prompted Bumrungrad to adopt Hospital 2000 IS, which completely transformed the way the hospital operations were managed.
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Hospital 2000 adhered to several ANSI3 standards, a global standard governing the exchange of clinical data and the management, delivery and evaluation of healthcare services. It kept pace with the IT requirements of a modern day healthcare business. Commenting on this, Patrick Downing, CEO, Global Care Solutions, the company which installed Hospital 2000 at Bumrungrad said, It takes advantage of paper scanners, cameras, all of the modern devices found in a healthcare facility. It really allows them to capture what they need and to attach it to the Electronic Medical Record and give that patient better healthcare.4 BACKGROUND NOTE Established in September 1980, Bumrungrad5 was originally a 200-bed facility. The initial investment was Thai 90 mn. The hospital was jointly owned by the Bangkok Bank and the Sophonpanich family, one of Thailands leading business families. In 1989, Bumrungrad went public and its shares were listed on the Thai Stock Exchange. Over the next decade, Bumrungrad adopted several innovative practices to emerge as the best privately managed hospital in Thailand. The significant increase in the number of domestic patients over the years led to a manifold increase in revenues. In January 1997, Bumrungrad shifted to a new facility located at the centre of Bangkok. Constructed at an estimated cost of $110 mn ($60 mn raised through offshore loans), the 12-floor building had 554 beds and 21 operation theatres. The hospital was equipped with the most modern equipment and had 600 physicians, nearly half trained in the US, and drawn Baht6

from different parts of the world. The physicians, however, were consultants and were not on the hospital rolls. Bumrungrad hired an international management team led by American professionals. Its CEO, Curtis Schroeder (Schroeder) had prior experience of running a hospital in California. However, in July 1997, Bumrungrad faced a tough situation when Thailand was severely hit by economic recession. Owing to the Southeast Asian currency crisis, the value of the Thai Baht dipped sharply. The crisis had its fallout on the middle class Thai population, from whom Bumrungrad derived most of its revenues. They started shifting to government hospitals where healthcare was available free or at a lower cost. In this adverse situation, Bumrungrad decided to change its strategy by targeting more foreign patients, including expatriates in Thailand and nearby countries. It also decided to tap patients in developed countries in Europe and the US. Describing the situation, Schroeder said, We basically had two alternatives at that time. We could shut down the place and lay off employees, cut costs and turn off the lights and try to weather the storm, or we could aggressively use it as an opportunity to build market share. We went with the General Electric approach, the Jack Welch approach, which is that where you make your biggest market share is during down markets.7 Bumrungrad began an aggressive marketing effort to project itself as a global hospital complying with international standards. The hospital had already applied for and received the ISO8 9002 quality certifications for all its departments and
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systems in March 1997. In 1999, the ISO certified Bumrungrad as a Comprehensive Tertiary Acute Medical Centre9. With this, it became the worlds first healthcare company to receive this certification. Schroeder said, Its not a magic cure, but whether youre selling cement, steel or healthcare, without third party validation, its difficult to get
Video 2.7.2 : Video of Bumrungrad Hospital Virtual Tour

THE NEED In view of the intensifying competition in Thailands healthcare industry and to generate international appeal, Bumrungrad was looking for ways and means to enhance service quality. The management felt that providing the best possible customer service was critical for the hospitals growth. However, the deficiencies, which kept cropping up in its existing IS, were hampering the quality of customer service provided. Bumrungrads IT operations were handled by four Unix-based systems and several applications like Access and FoxPro, which varied from department to department. The existing IS posed problems and also had high maintenance costs. They required several people to operate them. Further, they did not generate the information required for the hospital to manage its operations efficiently. Moreover, the IS was not able to deliver information, which would help determine the direction of business in near future. Bumrungrad required an IS which not only catered to its immediate IT needs but also those of the future. The IS must contain complete Electronic Medical Records11 (EMR) to help it manage operations better. It must also provide the required information for its doctors and other support staff so that they could deliver better patient care. Retaining the best doctors was another major challenge for Bumrungrad. As the doctors were consultants, who hired Bumrungrads facilities, they could choose anytime to offer their services to other hospitals. Thailand had nearly 250 hospitals at that time. The management was aware that
37

international recognition.10

Bumrungrad also decided to use the Internet as an information and marketing medium to promote its healthcare services to foreign patients. It launched its website www.bumrungrad.com - in 1997. The website had several user-friendly features to provide healthcare information sought by visitors. For instance, visitors could get information on the medical facilities and the range of treatment available at the hospital. One of the websites main features was the Find a Doctor section. Using this, patients could choose from 600 doctors and book an appointment online, to suit their preferences and requirements. Thus, the patients preferences for the type of treatment, the nationality or expertise of the doctor and so on were taken care of at the first instance. Appointments were confirmed within two hours. By mid-1999, the website was drawing 800 hits a day. Bumrungrads management soon felt the need to further modernize its IS to serve customers better.

patients preferred leading doctors and, the choice of hospital came only after that. Providing an ideal environment with good infrastructure and the most advanced IS, to attract the best doctors in the country was, therefore, essential for Bumrungrad. Commenting on this, Schroeder said, It is the hospital with the best physicians that will win. We need to create an environment that will allow our doctors to practice medicine in the best way and create the best relationships with their patients. At the core, it comes down to good people as well as an exceptionally well-designed information system. We wanted clinical information at the fingertips of our doctors to enable Video 2.7.3 : Advance Technological Support used in Bumrungrad Hospital them to make better decisions.12 In the healthcare industry, service efficiency is assessed in terms of quality of treatment as well as time taken for treatment. The less the time spent at the hospital, the less the expenditure incurred by patients. Schroeder said, Patients assess their level of hospital care in different ways. How quickly they move through the system is a key measure. Wed reached a plateau on reducing patient time in the hospital and we knew that better information was the

only way we could continue to provide excellent service and get patient days down.13 Bumrungrad also wanted the IS to boost its online initiatives. This meant enabling its customers, primarily international ones, to book their appointments online through its website. It also wanted online communication with Bumrungrads suppliers and insurance companies, with whom it had to maintain daily contact for billing and other administrative purposes. All these requirements prompted Bumrungrad to go in for a complete replacement of its existing IS in 1999. It chose Global Care Solutions14 (GCS), a Luxembourg- based IT company to implement the new IS at the hospital. SYSTEM IMPLEMENTATION On December 17, 1999, Bumrungrad successfully switched over from its old IS to its new customized Hospital 2000 information system. However, implementing the system was not easy, considering the number of tasks involved. These included conversion of data contained in the four existing UNIX systems; providing training to the 1200-strong staff and more than 200 doctors; and installation of required hardware and software. DATA CONVERSION The first major task was data conversion. The four systems from which data had to be retrieved were a commercial out patient system, a commercial accounting system, an inhouse in-patient system and a document management
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system (DMS). Each system was run on different database engines Oracle, Ingres, Informix and Sybase - complicating matters further. Most of the information had to be filtered to eliminate unnecessary and ambiguous information. It was also difficult to map the data to suit the Hospital 2000 IS, as a significant portion of the data was in the Thai language. While converting the data, the major challenge encountered by GCS was with the DMS of FileNet Corporation. This was because FileNet had its own communications protocol15. About five mn documents pertaining to out patient records of three and a half years had been scanned into the DMS. The records could be instantly accessed by physicians, nurses and other support staff. To convert this significant amount of data, the GCS staff wrote a program called FileNet Converter, which converted each document in the DCS into TIFF16 files and saved it in a Microsoft NTFS file system17. The program was administered without interruption for six months. To ensure that the operations at the hospital were not disturbed, the program was run during particular times of the day and throughout the night. At the time of installation in 2000, Bumrungrad needed 450 desktop computers 100 network printers and 120 scanners to be placed in various locations across the hospital. The Bumrungrad IT team did this job. Once it was accomplished, GCS installed the Hospital 2000 software on all the PCs (terminals) from a remote location using a proprietary software distribution method. The advantage of this method was that it facilitated upgradations in the application at any time without disturbing clients significantly. With active

participation and co-operation from Bumrungrads IT team and the GCS staff, the installation of Hospital 2000 was completed quickly. One of the critical operations of installing the new system was the formal switch from the old system. Rather than allowing the new system to be in use for some time while continuing with the old system and then switching, Bumrungrad opted for a one-time switch over. Needless to say, this move was risky, as there was danger of failure of the new system when the old system had been switched off. The GCS staff was on guard to meet any such eventuality. However, proper planning and preparation ensured that the formal installation went off smoothly. Within 48 hours of full-time operation, GCS and hospital staff addressed all major issues relating to the system. GCS personnel were available on site for the next 15 days so that the systems and networks were properly attuned. TRAINING Another important task was training the 1200 hospital personnel and 200 physicians. Training was imparted by GCS staff in association with Bumrungrads education and training department. For this, senior members from each work area in the hospital were selected and trained on the complete usage of the Hospital 2000 system, pertaining to their area of responsibility. They, in turn, became trainers for personnel in their respective work area. To ensure that both trainers and staff gained full knowledge of the practical usage of the system, a simulated training set up comprising 40 PCs connected through a network was created at the training
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centre. This set up resembled all the departments of the hospital. The training lasted for four weeks during which hospital staff learnt how the various departments were connected through Hospital 2000. The GCS staff also cleared any doubts about the systems functionality. The willingness of the hospital staff to learn, and the education departments efforts ensured that the training phase was completed successfully. HARDWARE AND SOFTWARE The hardware for Hospital 2000 comprised 450 Dell Optiplex PCs (clients), with a 400 MHz Celeron processor with 64-128 MB Read Access Memory18 (RAM), 4 Pentium-III XeonTMbased Dell Power Edge 6300 Clustered Servers and a Dell Power Vault 650F Fibe Channel storage system. The combination of a pair of clustered servers and a PowerVault 650F supported the 450 clients operating at different locations in the hospital simultaneously. The Power Vault 650F channel storage system ran on the MS SQL platform and formed the database for Hospital 2000 IS. The configuration of the clients was standardized so that they could be easily integrated with Hospital 2000 IS. Further, uniform configuration meant easier maintenance, as the hospitals IT team could develop a basic understanding of the system. These systems could also be easily upgraded at any time to meet future requirements. The Operating System used was a combination of Microsoft Windows 2000 and SQL 2000. Bumrungrad was one of the

first sites on which this combination was employed. The systems were connected to the Internet through leased lines and through satellite connection (Refer Exhibit II for a list of hardware and software used in Hospital 2000 IS). SYSTEM ARCHITECTURE The Hospital 2000 IS was built on a three-tier architecture, comprising PC-based clients, clustered servers and the database (Refer Exhibit III for a diagram of the system architecture.). The clients represented the face of the IS, through which data relating to various hospital operations could be keyed in, and through which data stored in database could be extracted. The complete Hospital 2000 suite was available in each of the clients located across the hospital. The middle tier comprised clustered servers, also called transaction servers, as they facilitated transactions taking place in the hospital. The clustering19 of the servers was done through the MS Windows 2000 clustering service. This was essential for the systems to handle high workloads, especially during peak hours. The middle tier served as an interface between the clients and the database. Any transaction taking place in the hospital (like queries posted into the clients as well as data fed into the clients) passed through the middle tier. Its function was to retrieve required data from the database and make it available to the clients. It also ensured that the database was updated with every transaction occurring at the clients (like data keyed in, images stored, images scanned and so on). This would ensure that integrity of data was maintained.
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The database server received and processed queries received from the middle-tier transaction servers. The major function of these servers was to support data warehousing20 and online analytical processing21 (OLAP). It facilitated storing and extracting valuable information, which was critical to run the operations at Bumrungrad. During peak hours, the server database processed 170 SQL statements per second. NETWORK ARCHITECTURE Within the hospital, the clients, the transaction servers and the database servers had to be properly connected in a network arrangement to enable uniform flow of information. The database server and the middle tier servers were together called the data centre, which supported the clients. The servers and the clients used the TCP/IP protocol22. (Refer Exhibit IV for the network architecture diagram) Across the hospital, a group of clients were clubbed together, based on the commonality of the purpose being served (for example, clients in a department) or on any rational basis. They were linked to network hubs, placed in the respective departments or on each floor in wiring closets. Each hub was linked to a switch unit point. This unique network architecture facilitated a rise in the number of clients as the hospitals operations could expand without affecting workflow. This could be done by just adding more hubs or switches. The fibre optic cables facilitated transmission of data at quicker speeds between the clients and the data centre.

The well-planned deployment of Hospital 2000 IS enabled Bumrungrad to operate the system without major problems and avoided unnecessary expenditure for the company. The fact that the entire deployment, including data conversion, training and rollout of hardware and software was completed in 45 days, was testimony to the kind of co-ordination and team work among the hospital IT staff and GCS employees. According to company estimates, Bumrungrad spent US$ 6 mn on the system. Over the years, as the Video 2.7.4: Microsoft size of operations increased, the Amalga System number of clients increased from 450 in 1999 to 900 in 2004. INTRODUCING NEW FEATURES Over the years, Bumrungrad made constant efforts to upgrade the Hospital 2000 IS to provide better service to patients. In February 2002, an interesting and useful feature Picture Archive Communication System (PACS) was incorporated into Hospital 2000 IS. Known as Amalga, it was run on a Microsoft Windows 2003/SQL Server platform (Refer Exhibit V). The estimated cost of the PACS was 28 mn Thai baht23. PACS comprised all X-Ray images stored in digital format. This enabled Bumrungrad to process radiology studies digitally instead of using films. The system comprised diagnostic software with a complete package of image manipulation and reporting tools for radiologists. All radiologists in the hospital could access digital images instantly through PACS. It also
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provided them access to medical studies and reports through the Internet and through local area networks. PACS facilitated exchange of information in various languages. The system drew enthusiastic response from the doctors at Bumrungrad. Within six months of implementing the system, 99% of X-ray studies at Bumrungrad were done through PACS. The doctors explored the system with much enthusiasm. Commenting on the advantages of PACS, Pat Downing said, With all historical study information at their fingertips, doctors can look at the whole picture the result is better informed decisions. Digital radiology offers numerous advantages: reporting times on digital studies are greatly reduced, providing results more quickly; lost films are eliminated ensuring medical records remain complete; multiple doctors can collaborate and view images simultaneously without waiting for hardcopy films and reports are available online in real time as soon as they are submitted.24 On an average, nearly four gigabytes of images were stored at the Amalga PACS every day. The physicians and hospital staff could access these images at any point of time from any PC in the hospital. The efficiency of the system could be seen from the fact that an X-Ray image of size up to 7 MB could be retrieved and viewed in less than 2 seconds. PACS also obviated the need for the hospital to use X-Ray films, and in the process, significantly cut costs. It eliminated the cost of storage and maintenance of films and, more important, removed the risk of X-Ray images being damaged or lost. It was estimated that since its implementation at Bumrungrad, the hospital generated savings to the tune of

17,000,000 baht every year. The database size at Bumrungrad increased by an estimated 1.5 terabytes between February 2002 and October 2003. Another advantage of PACS was that soft copies of X-ray reports could be sent to other hospitals, both within Thailand or abroad, upon specific requests by patients who needed further examination and treatment. THE BENEFITS Hospital 2000 IS led to a significant improvement in the efficiency of operations at Bumrungrad. Hospital 2000 was the first IS in the healthcare industry in Thailand that combined all front office systems, all medical, nursing and ancillary departments, and back office accounting functions into one database. The IS was used across all departments including labs, radiology, pharmacy, cardiology, patient registration, administration, operation theatre scheduling, billing, purchases, inventory management, room management and medical records. The database comprised details relating to 2 mn patients treated at Bumrungrad dating back to the past 20 years. It even included prescriptions. A major benefit of the new system, which differentiated it from other healthcare systems, was its multi-lingual capabilities. Files containing medical records, bills and drug labels could be instantly translated and printed in Japanese, Chinese and English. (Refer Exhibit VI for the unique features of Hospital 2000 IS). Every year, the system processed 1.7 bn transactions. Since its installation at Bumrungrad, the system has been operating at 99.9999% uptime.

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The IS also facilitated quicker patient treatment, helping Bumrungrad to treat an estimated three thousand patients every day. The results of any medical test administered on a patient, whether simple blood examination or high-tech magnetic resonance image scans, could be accessed at 900 clients across the hospital. This largely simplified workflow within the hospital. Every detail regarding the patients, be it the doctors prescription or an X-ray image, could be scanned and recorded in the database in real time. The doctors had the option to type or scan their comments on patients, whichever was convenient. The patients enjoyed the convenience of walking into the hospital at any time without carrying their prescription or test records or even without an appointment. The moment the patient entered the hospital, the computer systems would allot them to the doctors who had the shortest queue, thereby speeding up treatment. The low doctor-patient ratio of 24 patients per day per doctor also contributed to quicker patient treatment. Most doctors still preferred to give handwritten prescriptions to patients. This did not cause any problem as all they had to do was to simply scan their prescriptions into the system. Schroeder said, We had to give them an option because it is unlikely that our doctors, with the exception of a handful, will type their comments...we do not want to disrupt their methods of operation.25 By providing as much flexibility as possible for doctors in their operations, Bumrungrad made administering treatment a pleasant experience for doctors.

Once the entire patient data, including medical records, Xrays, were fed into the system, any doctor could continue the treatment for patients by viewing them. Unlike most leading corporate hospitals, which only provided access to the patients hospitalisation records, the Hospital 2000 system made available a patients X-rays, ultrasounds and other test records too. The Hospital 2000 IS proved indispensable for Bumrungrad. This was clear from the words of Ruben Toral, manager of Bumrungrads International Program, We have 554 beds, over 2,500 outpatients a day and 800,000 patients per year. A similar 500-bed hospital in the US typically treats only 100,000 patients per year. Without our IT system, we would not be able to handle this many patients. QUESTIONS FOR DISCUSSION: 1. Bumrungrad upgraded its information systems in the late 1990s. Explain the rationale for Bumrungrad to make significant investments in upgrading these systems. 2. Bumrungrads previous information system had several problems which the new system had to address. Describe the features and the architecture of the new system. Discuss how it solved the problems of the old systems faced by Bumrungrad, earlier. 3. In the light of increasing volume of foreign patients handled by Bumrungrad, do you think the implementation of new information system was beneficial for the company? Discuss.
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Exhibit I

Exhibit II
HARDWARE/SOFTWARE OF HOSPITAL 2000 INFORMATION SYSTEM

AWARDS FOR HOSPITAL 2000 INFORMATION SYSTEM

Global Care Solutions Hospital 2000 Month/Year Organization Award Dell 6300 clustered server Dell 660/650 FC storage units Dell 220S SCSI storage Dell Optiplex Desktop PC Microsoft Visual Basic 6 Microsoft SQL Server 2000 Microsoft Exchange 2000 Microsoft Windows 2000 Advanced Server Microsoft Windows 2000 Professional Microsoft BizTalk 2000 VideoSoft Flexgrid 7 TAL Technologies TAL Barcode DLLs 1.0 DBI Technologies Schedule 3.0

Hospital Asian Hospital Management September Management Awards for Information 2002 Asia Technology October 2002 2002-03 Microsoft Intelligent Enterprise Asia CIO Asia Microsoft Fusion 2000 Business Solution of the Year award Intellgent 20 Award

2002-03

CIO 100

Source: www.hospital2000.com, www.bumrungrad.com

Sheridan Active Toolbar 1.02. Source: Bumrungrad Hospital, www.intelligentasia.com, January 16, 2003

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Exhibit III Hospital 2000 - System Architecture

Exhibit IV Hospital 2000 - Network Architecture

Source: www.hospital2000.com

Source: www.hospital2000.com

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Exhibit V Amalga Picture Archive Communication System

Exhibit VI Unique Features of Hospital 2000

1. Patient Registration information can be captured in English or a second language. 2. Investigative orders are issued from the point of care. 3. Order information available in real time for processing in the investigative departments. 4. All services information is immediately available for patient billing.

Source: www.hospital2000.com

Source: Microsofts Shoots Video at Bumrungrad Hospital, Showcasing the Hospital 2000 Solution, www.hospital2000.com, July 2000

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S ECTION 8

Enterprise IS - An Overview

Source: http://www.bournemouthwebsites.com

The world is witnessing an information and communication revolution. IT has changed the way people interact. The Internet has brought about a fundamental change in the way we work, shop, communicate, learn and play. Businesses have also benefited significantly through the use of the Internet. The speed and efficiency of business transactions have improved drastically. Business deals that took months to finalize are now closed within hours. Besides, the Internet has helped streamline the business processes of organizations. The use of Internet technology for strategic advantage helps organizations improve efficiency and compete globally.

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The Internet has also had an impact on customers, who have become more demanding as they now have more information about new products and services. The speed of the Internet has changed every aspect of business, be it interactions with customers, relationships with partners, or supply chain management. IT helps organizations communicate, coordinate and collaborate both within and outside the organization. Systems that facilitate communication, coordination and collaboration to help people work together are known as enterprise collaboration systems. The three main components of an enterprise collaboration system are electronic communication systems, electronic conferencing tools and collaborative work management tools. Workgroup support systems comprise groupware that facilitates linking of workgroups located in different geographical regions. Multimedia is another popular tool for enterprise collaboration. It helps in making presentations more interactive and interesting. Enterprise Communication Tools Enterprise communication tools help in sharing documents, files and messages electronically with others. These include electronic mail, faxing, voice mail, instant messaging, web publishing, Internet phone and paging systems, and the Usenet. Through these tools, one can send data files, text, voice messages, or multimedia to others through computer networks.

Enterprise Conferencing Tools Enterprise conferencing tools enable people to share information in an interactive way. These tools include Source:http://www.tnspl.in teleconferencing, discussion forums, chat systems and electronic meeting systems.
Video 2.7.1: CISCO TelepresVideo 2.7.2 Telepresence (CISCO ence Magic - 1 Video Conferencing) - 2

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S ECTION 9

Customer Relationship Management - An Overview

as e-CRM (Refer E x h i b i t 1 9 . 1 ) . Video 2.9.1: Introduction on CRM Several factors including high cost of acquiring new customers, cutthroat competition, globalization and high customer churn rate have led to e-CRM initiatives by organizations. Organizations are looking for ways to personalize online experiences of customers through eCRM tools such as e-mail organizers, help-desk software and web development applications.

Source: http://www.webgranth.com

Customer relationship management or CRM involves all aspects of interaction (including sales, marketing, and customer service) of an organization with its customers. Managing customer relationships electronically, primarily through the Internet, by organizations is popularly known

49

Video 2.9.2 : Microsoft Dynamics Interview

Video 2.9.3: FonGenie Software Demo

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S ECTION 10

ERP - An Overview
just one or two departments/functions, but the entire range of functions like manufacturing, marketing, human resources, finance and logistics. ERP ensures that data entered in any one of the functional modules is made available to other modules that need the data. This improves the consistency and integrity of data. ERP uses the process view of the organization rather than function view that traditional enterprise software used. The function view narrows the focus to a particular functional area and serves some specific needs. The process view emphasizes a broad understanding of the entire organization and its systems and procedures.ERP implementation in a large corporation may need an investment of more than Rs.100 million. In spite of the huge investment required for implementation, many organizations including service organizations (like consulting firms, advertising agencies and law firms) are deploying ERP software to an increasing extent.

Source:http://www.jbmetrics.com

Enterprise Resource Planning (ERP) is a software application that helps an organization integrate various functions, make optimum utilization of management resources and improve its process efficiency. ERP seeks to address the needs of, not

51

S ECTION 11

Supply Chain Management - An Overview

transparency and accountability among themselves. Through the supply chain, the flow of information, material and financial information between the business entities is coordinated. The supply chain links all the activities in the procurement, transformation & storage of raw materials and intermediate products, and the sale of finished goods. The facilities required for procurement, transformation, storage and sales are interconnected by transportation links in the product flow. The product flow describes the processes in transforming raw materials into finished goods. The information flow describes the future requirements (raw materials, products & tools and equipment) and order delivery status.

Source: http://blog.sourcinginnovation.com/

Supply chain management is a set of processes which helps organizations develop and deliver products. The supply chain represents the complex relationships of an organization with its trading partners through whom it sources materials, manufactures products and delivers products or services to the customers. Generally, the supply chain comprises of multiple companies working together as a single entity with complete information

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S ECTION 12

E-Commerce and E-Business - An Overview

E-Commerce and e-business are two different terms though they are sometimes used synonymously. E-Commerce deals with the buying, selling, and distribution of information, products, and services through computer networks. E-Commerce ensures minimum inventory control, improved customer service and global reach.

Source:http://labho.com

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E-Business is a much broader term. E-Business transactions that are monetary in nature can be termed as e-commerce transactions. E-Business involves more than buying and selling of products and/or services. Apart from e-commerce, it includes several other areas like supply chain management, customer relationship management, knowledge management, business intelligence and collaborative technologies. EBusiness comprises the processes and culture of an organization. It uses the intranet, extranet, collaborative technologies and the Internet to connect the organizational systems with the employees, customers, suppliers and the business partners. E-BUSINESS MODELS There are eight e-business models, namely business-tobusiness, business-to-consumer, consumer-to-consumer, business-to-employee, government-to-citizen, citizen-togovernment, government-to-government and government-tobusiness. These models are discussed in detail here: Business-to-Business Model Business-to-Business (B2B) is the most popular e-business model dealing with B2B transactions. B2B marketplaces evolved with the primary goal of matching buyers and

sellers, thus enabling the exchange of goods and services. B2B websites help streamline operations between organizations and their business partners. For instance, an automobile component manufacturing company can sell its components and parts online to an automobile manufacturer. Business-to-Consumer Model The Business-to-Consumer (B2C) business model deals with B2C transactions. The ebusinesses that adopt B2C model sell their products and services directly to individual Source: http://2.imimg.com consumers. This business model is expected to become more popular when low cost Internet access is available to the masses through mobile phones and other Internet access devices. Consumer-toConsumer Model Consumer-toConsumer (C2C) websites enable the sale and purchase of products and services between individual customers. Individual customers
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Source: http://jeffpulvino.com

Source: http://www.openideo.com/

frequently buy and sell products like automobiles, furniture and real estate from each other. They can find such products on a C2C site and conduct transactions online. The best example of a C2C business model is an online auction site. In 1995, eBay.com pioneered C2C auctions. Government-to-Citizen Model Government-to-Citizen (G2C) websites provide a platform for the government to connect with citizens in order to provide benefits to citizens and to improve public services. Examples of this model Source: http://www.watblog.com/ are electronic government service centers which issue ration cards, accept electricity bills and water bills, issue passports and undertake registration of motor vehicles. The government hosts some websites which contain information about the various public-related initiatives taken and the services offered by it. The websites contain all income and expenditure related information of the government and thus make the government servants accountable to the people. Further, people can avail various benefits provided by the government under various schemes. However, it is important for the customers to provide continuous feedback to improve the services. The e-Citizen portal of Singapore and the eSeva portal of Andhra Pradesh government, etc., are well known G2C sites.

Citizen-to-Government Model Citizen-to-Government (C2G) websites help citizens to interact with the government. For example, citizens can cast their votes during elections and pay taxes online through government websites. Under the concept of edemocracy, citizens are encouraged to vote and engage in governance, online. The government takes inputs from citizens and organizes an e-debate, a concept similar to Internet chatting. In an e-debate, political leaders belonging to various parties participate. The citizens give their opinions regarding the manifestos of various parties. This initiative brings citizens closer to the elected members and also gives them a chance to evaluate their leaders. The eSeva portal of Andhra Pradesh government is also a C2G site. Government-to-Government Model Government-to-Government (G2G) is also known as eadministration. It aims at cutting costs and improving government processes by interconnecting government departments. This involves connecting all government offices, departments, and district headquarters with each other and with the secretariat so that information is shared by all. This helps in reducing the time taken for solving customer requests and improves customer service levels. G2G websites are mostly state websites that are not allowed for public viewing. These sites are mostly located in a non-public system.

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Government-to-Business Model The Government-to-Business (G2B) initiatives provide a

R EVIEW 2.1
Question 1 of 6
The buying, selling, marketing and servicing of products over the Internet and computer networks is called

Source: http://incentive-intelligence.typepad.com

A. B. C. D.

Groupware Electronic Commerce Enterprise collaboration Web publishing

platform for businesses to interact with government. The government websites provide companies with access to the rules and regulations regarding exports and imports and other laws governing businesses. They also provide forms that are required to be submitted in order to comply with the government rules. On the whole, these websites provide total government-wide information related to businesses and reduce the burden of contacting various government officials for relevant information on businesses. City-specific websites like www.ci.boston.ma.us (Boston), www.cityofchicago.org (Chicago), www.vipnet.org (Virginia), www.calgold.cagov (California), etc., in the US are some of the G2B websites.

Check Answer

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C HAPTER 3

Building Models Using Microsoft Excel

Source: http://www.enterpriseirregulars.com

S ECTION 1

Introduction to MS-Excel
MS-Excel is an office tool from Microsoft Corporation. We use Excel tool for our personal purpose, office purpose and strategically forecast purpose for a business organization. Personal Purpose: Plan Family Budget, Calculate Marks & Grades, Calculate Loan, Interest, etc. Office Purpose: Operational Cost Calculation, Sales calculation, Income Statement generation, Profit-Loss calculation, Balance Sheet generation, Payroll Calculation, etc. Strategically Forecast: Sales Forecast, Trend Analysis, Statistical Data Analysis, Budget Management, Financial Model, Profit-Loss Management, Model Simulation, etc. Organization Benefits: Generally all excel files are available in the form of worksheets and workbooks. If you have Excel Services, you can share worksheet data with other people, such Video 3.1.1: Business Reporting as executives and Using Excel other stakeholders in your organization. We can display it in web format for publicly available and embedded video & audio files. We c a n v i e w, analyze, print and extract this worksheet data. It facilitates easy way of accessing huge data by scrolling, filtering, sorting, viewing charts, etc. In its advanced use, we can use excel to integrate with Document Management Server for validation of Excel reports and workbook calculation.

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S ECTION 2

Spreadsheet Concepts
A s p r e a d s h e e t i s a n Video 3.2.2: Introduction to application in which data is Spreadsheets -2 represented in a tabular form, i.e., in the form of rows and columns. Spreadsheets allow users to create tables of information which can be manipulated and represented in the form of data table, pivot table, graphs and charts. The information stored in these tables is generally numeric. Users can perform numerical operations such as addition, multiplication, subtraction, division and use function & formulae for making complex calculations. A cell is the intersection of a row and column. When a formula is applied to a cell, the result gets displayed in the cell. The user can only view the final result. The formula can be seen in formula bar and the changes are reflected instantly. This makes spreadsheets useful for what-if analysis and other complex calculations. MS Excel is an example of spreadsheet software.
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Video 3.2.1: Introduction to Spreadsheets - 1

Workbook In MS Excel software, a workbook is a file in which data is entered and stored. Each workbook contains a number of worksheets. The user can simultaneously enter and edit data on several worksheets. The user can also perform calculations using the data from these worksheets. Hence a workbook is similar to a book and the worksheets are the pages in that book. For instance, all the employee details of an organization can be entered in a workbook and each worksheet can contain the details of the employees of a specific department Video 3.2.4: Simply within the organization. Spreadsheets Worksheet A matrix of rows and columns is a worksheet. The columns in a worksheet are named alphabetically starting with A a n d t h e r o w s numerically starting with 1. Each worksheet has 256 columns and 65,536 rows. Each cell on the worksheet has an address and the cell currently being used is called the active cell. For Example, for column A and row 1, the address of the cell can be represented by A1.The contents of the active cell are displayed in the formula bar. These contents are text boxes, numbers and

formulae. Text boxes, also called labels, explain the numbers that have been entered in the cell. Numbers are values entered in the cell, while formulae are mathematical expressions that are used to perform calculations on the values entered in the cell. Figure 3.2.1: A General Excel Spreadsheet

The different parts of a worksheet are: Title bar The Title bar appears first on the top of the worksheet and displays the name of the worksheet. For example, Microsoft Excel Book1. Menu bar
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The Menu bar appears directly below the Title bar and displays the menu with the following options: File, Edit, View, Insert, Format, Tools, Data, Window and Help. Toolbar/Quick Access Toolbar

Video 3.2.3: Understanding Spreadsheets

Scroll bars and scroll arrows Scroll bars and scroll arrows are used for scrolling the sheet. These are used to move the sheet to view the required portion of the sheet on the screen. Sheet tab Users may work on more than one sheet simultaneously. A user can click on the sheet tab to switch from one sheet to another. Users can also use CTRL+PgUp and CTRL+PgDn to move between worksheets. Effective Worksheets In order to design effective worksheets, one has to keep in mind the basic reason for designing the worksheet, i.e., the main purpose for which the worksheet will be used. Another reason that needs to be borne in mind is the kind of audience that is being targeted. Worksheets might be used for many purposes and might be targeted at different sets of audiences. Therefore, these aspects should be kept in mind while designing the worksheets. Some suggestions for developing effective worksheets are mentioned here: The worksheet should be given an appropriate title so that the user gets an idea of what is presented in the worksheet. For example, if a person is presenting data regarding monthly sales, the worksheet could be titled Monthly Sales Report.
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To o l b a r s p r o v i d e shortcuts to menu commands and are generally located near to Menu bar. They consist of the standard toolbar and the formatting toolbar. The standard toolbar displays options for opening, saving files, cut, copy, paste, etc. The formatting toolbar displays options for document alignment and style. Column heading and row heading Column and row headings help in assigning addresses to a cell. Cell addresses are useful for cell referencing. For example, A1 refers to the cell in the first column and first row, B3 refers to the cell in the second column and the third row of the document. Window controls Window controls enable users to zoom a window, restore a window to its previous position, or hide a window from view.

The purpose of the worksheet should be clearly mentioned. For example, specific names like analysis report, sales report, information report, etc., should be given. The format in which data is entered should be specified clearly. For example, if a person wants the input value to be in dollars then the input format should be changed to dollars ($ 45). Cell referencing should be used for applying formula to data. Data entry cells should be different from calculation and output display cells.

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S ECTION 3

Data Input: Data Type

Video 3.3.1: Basic Data Entry in Excel

Different types of data can be entered in active cells of spreadsheet. Data type refers to the type of information one needs to store and work with in a worksheet. Excel allows four different types of data to be entered or displayed in the cells. These are: Text, Numbers, Logical and Error.

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Text Text is a data type that consists of a combination of letters, numbers and special characters. For example, Nikhil, Class 1, etc. Numbers The default alignment of numbers in the cell is to the right. Dates and times will be displayed based on the format selected. To consider a number as text, an apostrophe () should be typed before the number. Excel will consider it as text and will automatically align it to the left. e.g :123455 An unformatted number will be displayed in a scientific notation if it does not fit in a cell. A formatted number will be displayed as #### if it does not fit in a cell. Logical Logical is a data type that consists of values in the form of TRUE and FALSE. Excel gives out these values when certain types of functions are used (discussed later). For instance, consider the Information function ISBLANK. This function verifies if a particular cell is empty or not. If the cell is empty, Excel gives out the result TRUE and if it has a value, the result will be FALSE.

Error Excel displays any error in the formulae. For example, an error displays #VALUE!. It indicates that the value that has been referred to or used in the formula is not correct. The other errors are like #DIV/0!,#N/ A,#NAME?,#NULL!,#NUM!,#REF! These will be discussed later in functions and formulae. Detailed Concepts on Data Types: Refer to the Link below. http://www.chem.tamu.edu/class/majors/commonfiles/ex celtutor.htm#3.2

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S ECTION 4

Operators

Video 3.4.1: Excel Basics - Formulas, Operators and Math Operators specify the type of calculation that the user wants to execute on the elements of a formula. Excel consists of four types of operators: arithmetic, comparison, text and reference.

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Arithmetic operators Table - 3.4.1: Arithmetic Operators

ARITHMETIC OPERATORS + * / % ^ FUNCTION Addition Subtraction Multiplication Division Percentage Exponentiation EXAMPLE 6+4 5-3 2*2 6/3 25% 2^3(2*2*2)

Comparison operators These operators compare two values and then generate the result in the form of a logical data type, i.e., TRUE or FALSE. Table 3.4.2 lists out the comparison operators and their functions along with an example.

Video 3.4.2: Comparative

Operators & Logical Formulas

These operators execute the basic mathematical operations like addition, subtraction, division and multiplication. They also combine numbers and generate numeric results. Table 3.41 lists out the arithmetic operators and their functions along with an example.

Table 3.4.2 - Comparison Operators

COMPARISON OPERATORS = < > <= >= FUNCTION Equal to Less than Greater than Less than or equal to Greater than or equal to Less than or greater than, but not equal to EXAMPLE P1=Q1 P1<Q1 P1>Q1 P1<=Q1 P1>=Q1

<>

P1<>Q1

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Text operators The text operator Ampersand or & concatenates text values in two or more cells to generate a single value. For example, cell A2 contains South and cell B2 contains India. The command =A2&B2 can be used to combine the text in the two cells. This would produce the result South India.

Reference operators Reference operators combine a range of cells for calculation. Table 3.4.3 lists the reference operators and their functions along with an example. Table 3.4.3 - Reference Operators
REFERENCE OPERATORS FUNCTION
It is also called the range operator. It indicates all the cells between and including the given two cell references. It is also called the union operator. It combines multiple cell references to form a single reference. It is also called the intersection operator. It generates a single reference to all the cells that are common to the two given references.

EXAMPLE

Colon (:)

G2:G15

Comma (,)

AVG(A2:A9, B2:B9)

Space (a blank space)

SUM(A2:A9 B2:A9)

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In situations where the formula contains more than one operator, the operators are evaluated based on the priority order as given below in Table 3.4.4. Table 3.4.4 - Operators and their Order of Priority
ORDER 1 2 3 4 5 OPERATOR % ^ * and / + and &

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S ECTION 5

Cell Formatting

Video 3.5.1: Cell Formatting in Excel The data entered in the cell can be formatted either in word processing format or in numeric format. In the word processing format, the font, font size and text alignment can be specified. In the numeric format, subscripts can be assigned to values to express values in terms of money, percentage, fraction, decimal and date. For example, the value 23451.90 can be formatted as $23,451.90 or 23,451.90 and so on.

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Videofiles: http://www.youtube.com/watch?v=oyxknF1jJ_I Users have many options to format cells in a worksheet. To format cells, they have to first A drop-down menu appears from which the option called select the particular cell or cells that are required to be formatted. They then have A Format Cells dialog box Cells needs to be selected. to click on Users havebar and select to format cells in a worksheet. the menu many options the option Format. A drop-downappears which from which the option Number tab, menu appears has various tabs like To format cells, they have to first select the particular cell Alignment which has various tabs like called Cells needs to be selected. A Format Cells dialog box appearstab, Font tab, Border tab, Pattern tab and or cells that are required to be formatted. They then have Protection tab. Number tab, menu bar and select tab, Border tab, to click on the Alignment tab, Fontthe option Format. Pattern tab, and Protection tab.
Format Cells dialog box Fig.3.5.1: Formatting of Cells Each of these tabs is explained here: Number tab: The number tab allows the user to select data types. The various data types that Excel provides are general, number, currency, accounting, date, time, percentage, fraction, of input Cells & special and custom. Formatting scientific, text, If the user wants all the values to be expressed in result cells needed to get Dollars ($), then the data type Currency has to be desired output of the selected. This would in turn list out a set of options like problem else it gives wrong the currency to be inserted and the way it should be result or error. depicted. Alignment tab: The alignment tab enables the user to modify the position and the alignment of data within the cells. Excel allows the user to change the indent; change the direction of the text; align the text horizontally or vertically; and shrink the text, wrap the text, or merge the cells. Font tab: The font tab enables the user to change the font size, style and effects of the text.
Fig.3.5 Formatting of Cells Each of these tabs is explained here:

Border tab: The border tab allows the user to add borders with different styles and colors.

Number tab: The number tab allows the user to select data types. The various data types that Excel provides are Pattern tab: The pattern tab allows the user to add color general, number, currency, accounting, date, time, percentage, fraction, scientific, text, special, and custom. If the to the selected cells and be selected. This user wants all the values to be expressed in Dollars ($), then the data type Currency has tochange the background style. would in turn list out a set of options like the currency to be inserted and the way it should be depicted.

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Protection tab: The protection tab enables the user to lock cells and hide formulas. This option will work only if the worksheet is protected (discussed later). Customized Formatting This is one of the features of number formatting where we can format the number as per desired look and feel. This is generally used if we need to format certain financial calculations or population calculations in terms of lakh, crore, millions, etc. Table 3.5.1 Customized Formatting
DISPLAY CODE

down menu appears from which the user has to click on the option Freeze Panes. With this, the headings will be frozen and will be visible at all times even when the worksheet is scrolled down. In order to undo freeze panes, the headings (row or column), which have been frozen, have to be highlighted, the Windows option selected and the option Unfreeze Panes clicked on. This unfreezes the headings. Refer to workout: Formating.pdf, Excelfile: CHECKBK.XLS

12000 as 12,000 12000 as 12 12200000 as 12.2 Freeze Panes

#, ### #, 0.0,,

While working on a large worksheet with data in several rows and columns, the row headings may disappear as the worksheet is scrolled down. Similarly, the column headings may disappear as the worksheet is scrolled to the right. Freeze panes are therefore used to ensure that the headings appear all the time even when the worksheet is scrolled down. To freeze the headings, the headings (row or column) that need to be frozen have to be selected. The user then has to go to the menu bar and select the option Windows. A drop-

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S ECTION 6

Cell Referencing
Video 3.6.1: Cell References Sometimes, if values are directly used in the formula, there could be scope for errors as the values used in the formula may be wrong. It is also difficult to identify the error as the formula is only visible in the formula bar. To overcome this problem, cell references can be used.

Video 3.6.2: Absolute & Mixed Cell Reference

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on spreadsheet and they increase data validity. You can use data contained in different parts of a worksheet in one formula or use the value from one cell in several formulas. You can also refer to cells on other sheets in the same workbook, to other workbooks and to data in other programs. References to cells in other workbooks are called external references. References to data in other programs are called remote references. What do we do with Cell Reference

Create a cell reference on the same worksheet Create a cell reference to another worksheet Change a cell reference to another cell reference There are three types of cell references: A. Relative cell reference B. Absolute cell reference C. Mixed cell reference

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Relative Cell Reference Relative cell references are references to cells relative to the position of the formula. When a user creates a formula, references to cells or ranges are usually based on their position relative to the cell that contains the formula. For example, when we wish to calculate GALLERY 3.6.1: Relative Cell sum of two Reference numbers, the cell C2 contains the formula =A2+B2; once we enter, it will give result as 17 which is the sum of the value of cells A2=8 & B2=9. If we copy the same formula or drag it to C3 for calculation of 11 and 2 whose cell addresses are different, that is, A3 & B3, the formula will calculate the sum as C3=A3+B3. The result will be 13. Here the formula in C3 takes the relative reference of input cells which is adjacent to it as per the formula. This is known as relative referencing. When a formula that uses relative references is copied into another cell, the references in the pasted formula update and refer to different cells relative to the position of the formula.

Absolute cell reference If a user does not want references to GALLERY 3.6.2: Absolute Cell change when he/ Reference she copies a formula to a different cell, then absolute reference can be used. Absolute references are cell references that always refer to cells in a specific location. Sometimes, it is necessary to keep a certain position that is not relative to the new cell location. This is possible by inserting a $ before the column letter or a $ before the row number or both. This is called absolute positioning or absolute referencing. For example, if a users formula add cell A2 with cell B2 (=A2+B2) and he/she copies the formula to another cell, both references will change. The user can create an absolute reference to cell B2 by placing a dollar sign ($) before the parts of the reference that should not change. To create an absolute reference to cell B2, for example, dollar signs have to be added to the formula as follows =A2+$B$2. The dollar sign locks the cell value and location of B2 to a fixed value and position. When it is copied and pasted to cell C3, the value of B2 remains exactly the same but A3 is relative. In the first instant C2=A2+$B$2=8+9=17, while we copied to
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C3=A2+$B$2=11+9=20. This means A2 is relative reference in formula and $B$2 is absolute reference. Mixed cell reference Mixed cell referencing is a combination of relative and absolute cell references. In mixed cell referencing, a part of the formula is relative while some part of it is absolute. In a mixed cell, reference can either have the row reference absolute and column relative GALLERY 3.6.3 : Mixed Cell Reference (as in B$2) or the column reference absolute and the row relative (as in $B2). Residing the above example of A2+B2, the user copies the formula to another cell, all the references will change. A mixed reference can be created to cell B3 by placing a dollar sign ($) before 2 so that those parts of the reference do not change. To create a mixed reference to cell B2, for example, a dollar sign needs to be added to the formula as follows: =A2+B$2. Once we copy the same formula to C3, the A2 will change to A3, as it is relative. The B$2 part will take the row absolute

value and will not change to B$3. The result cells are: C2=A2+B$2=9+8=17 and C3=A3+B$2=11+8=19, as shown above. Similarly, we can make C2=A2+$B2 and once copied to C3 it will be =A3+$B3. Notice the changes: Bcolumn remains same as it is absolute, but row changed to 3. So, C2=A2+$B2=9+8=17, whereas C3=A2+$B3=11+1=12. Mixed reference is very useful in case of creating a multiplication table. Keynote 3.6.1 on Cell References

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S ECTION 7

Sorting and Filtering Data

Video 3.7.1: Sorting Data in Excel Sorting Data The spreadsheet has sorting buttons: Sort Ascending (A-Z) and Sort Descending (Z-A). which carry out the basic ascending or descending sort for the selected data. To sort data in a spreadsheet based on one column, the cells that need to be sorted should be selected or highlighted. After that the ascending or the descending buttons on the standard toolbar should be clicked on followed by OK. The cells will automatically get sorted based on the specified column (column 1, 2, or 3) and the specified order.

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Filtering Data Database filtering enables a user to view only those records that satisfy certain criteria. There are two types of filters in Excel: AutoFilter and Advanced Filter. AutoFilter - AutoFilter is a Video 3.7.2: Sort & Filter type of filtering data Data using Excel feature in Excel that helps in selecting and displaying only the data that is required. For instance, an employee database contains details about all the employees in the c o m p a n y, w h o a r e working throughout India. Using an AutoFilter, it is possible to find out the number of employees working in a particular state, say, Andhra Pradesh, and their details. Following are the steps that a user has to go through for filtering data using AutoFilter: Insert data in a worksheet. Select a cell in the table. Click on the Data menu. Click on the Filter option and then on the AutoFilter option. The AutoFilter option is now activated. Arrow buttons are displayed in all the cells with field names.

To extract the records, click on an arrow button in the column. A list of values gets displayed for specifying the condition. Click on Custom. A dialog box called as the Custom AutoFilter gets displayed. This box takes a maximum of two conditions on the selected column. For the string columns, wild card characters ? and * can also be used. The wild card character ? can be used for representing any single character while * can be used to represent any series of characters. Click on the arrow of the left-most drop down box that displays the comparison operators. Select the required operator. Click on the arrow of the right-most drop down box that displays a list of values. Click on the value button once again if the required value for condition is available so that the displayed list goes off. Enter the required value in the box. In case, a second condition needs to be included, click on AND or OR. Enter the condition in a similar way as entered for the first condition. Click on the OK button. The records that meet the specified criteria will get displayed. These records can also be copied to another location. In order to display all the records, the user should go to the Data menu and click on the option called Filter. The
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AutoFilter option should be selected from the drop down menu that appears. To view all the records,AutoFilter option has to be removed. GALLERY 3.7.1 on Autofilter To do this, the option has to be deactivated by clicking on it. [Refer Exhibits 3.7.1(a) 3.7.1(e) (in Exhibit 3.7.1(a) Appendix) for screenshots on AutoFilter along with an example]. Refer to the gallery to view the Exhibits 3.7.1(a) - (e): Screenshots on AutoFilter. Advanced Filter While filtering data using AutoFilter, Excel provides list boxes from which the fields and values need to be selected. In case users want to give their own criteria, they can type it in a separate criteria range above the list. The filtering process can be carried out from the menu by using the Advanced Filter option. The Advanced Filter is similar to an AutoFilter; however, the former also provides certain additional features such as copying the filtered data to another location; copying only the selected columns in the table to another location; and displaying only those records that meet the specified

criteria. The filtering criteria could include multiple conditions that can be applied to a single column as well as multiple columns. Workout: Sortprint.pdf

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S ECTION 8

Conditional Formatting
Video 3.8.1: Introduction to Conditional

Formatting

Conditional formatting to a cell in Excel facilitates different formatting options such as color a cell or cells that meet certain conditions. Suppose you are given a set of numbers 4, 5, 6, 7, 8, 9. You need to highlight all the numbers that will be greater than 6 with green fill with dark green text. Select all the cells containing the numbers. Go to conditional formatting tab. Select Highlight cell rules. Select the option greater than, another box opens where you can select number 6 and color as green fill with dark green text. You can apply new rules or more rules depending on the formula; like if you wish to color certain numbers which are less than, equal or greater than average. Refer to the gallery for demonstration shown in Fig.3.8.1(a) and 3.8.1(b).

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GALLERY 3.8.1: Conditional Formatting

Fig.3.8.1.(a) Conditional Formatting

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S ECTION 9

Data Formatting & Validation

Video 3.9.1: Data formatting in Excel Data formatting refers to the data types that the system can accept. If a data has to be input in number format or within certain range, it has to be defined in number format. Once the data type is specified for a range, the system will not accept any other formats and the system will either stop or show a warning/error message.

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Data validation feature of Excel is used to define restrictions on what data can or should be entered in a cell. Suppose we need to format cell A1 so that it can only take whole numbers between 2 and 5. If we input any other number it will show a warning message. Select the cell A1. Go to Data and then Data Validation. You will get Settings, Input Message and Error Alert. In Settings, chose Whole Numbers between 2 and 5. Then chose Input Title as Input and Input Message as Input a Whole Number. In the error alert chose warning -- put the title as output and message as The number is not Between 2 and 5. The checks for Data validation if the user inputs any number other than between 2 and 5.

Workout: Datavalidation.xls

GALLERY 3.9.1 : Data Validation

Fig.3.9.1(a) Data Validation Setting

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S ECTION 10

Formulae & Functions

Video 3.10.1: Getting started with formulas and functions

The ability to apply formulae to values and compute results make spreadsheets a powerful application program. Spreadsheets can be used to perform simple arithmetic operations like addition, subtraction, multiplication and division. They can also be used to apply complex formulae to values and compute results. In Excel, all formulae should be entered starting with an equal to sign, i.e., = and then followed by the values or references of cells whose values will be used in the calculation as per the operators used. For example, the formula =2+3+5 adds the numbers 2, 3 and 5.

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Formula and functions are correlated. The same addition of three numbers described above can be calculated by using built-in function called SUM() by selecting the range B3:B4:B5 and using the formula B6=SUM(B3:B5).

Video 3.10.2: Formulas & Functions in Excel - 1

Functions Mathematical, Logical, Statistical and Financial; Lookup A function is a special keyword which can be entered into a cell in order to process some data which is appended within brackets. The syntax for using functions is: cell address = Function Name (Data). The arguments passed to a function often include a range of cells. Excel recognizes these functions provided they are preceded by an equal sign and end with Video 3.10.4: brackets. A typical spreadsheet Formulas & Functions program contains over 100 in Excel - 3 different functions for performing statistical, financial, mathematical and logical operations. These functions are useful in performing simple and frequently used calculations. Click on the function fx in the formula bar, you will get different types of Functions used inExcel.

Sometimes formula contains function. Suppose we need to find the average of the above described numbers. It can be set as a formula like: B6=SUM (B3:B5)/3. Replication Formulas & If a user wants to apply a formula to values in more Functions in Excel - 2 than one cell or range of cells, then replication may be used. Replication is copying the formula and applying it to a range of cells by dragging the mouse and selecting the cells. Replication saves time, eliminates redundancy and is easy to use.
Video 3.10.3:

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Text functions Logical functions Information functions Financial Functions Financial functions in Excel help in conducting simple and complex financial calculations. Table 3.10.1 describes a few financial functions in Excel along with the syntax for using those functions. Video 3.10.5: How to use Financial Function in Excel Fig.3.10.1 Different Types of Functions in Excel Some examples are: =SUM(A1:A4),=AVERAGE(B2:B6), etc. [Refer below screen shots Fig.3.10.1 to Fig.3.10.6 for different Functions along with examples of financial, mathematical, trigonometrical and statistical functions.] Following are the different types of functions in Excel: Financial functions Date & time functions Mathematical & Trigonometrical functions Statistical functions Lookup & Reference functions Database functions
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Table 3.10.1: Financial Functions

Fig.3.10.1(a) Financial Function: Depreciation

Fig.3.10.1(b) Financial Function: Depreciation

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i) Where, rate = interest rate per period. nper = total number of payment periods in an annuity. pmt = payment made during each payment period. pv = the present value worth of future payment. type = number 0 or 1 that indicates that the payments are due. 0 is given when the type is omitted or when it is the end of the period while 1 is given when the payments are due at the beginning of the period. ii) Where, rate = interest rate per period. nper = total number of payment periods in an annuity. pmt = payment made during each payment period. pv = the present value worth of future payment. type = number 0 or 1 that indicates that the payments are due. 0 is given when the type is omitted or when it
Keynote 3.10.1 on Financial Function

value1, value2, = values during periods 1, 2, , representing income during that period. iv) Where, values = reference to the cells that contain numbers for which the IRR need to be computed. guess = a guess number that is approximately close to the IRR result. v) Where, nper = total number of payment periods in an annuity. pmt = payment (entered in negative) made each period which remain constant over the life of the annuity. pv = the present value worth of the future payment. fv = future value amount which will be attained after making the last payment. If fv is omitted, it is assumed to be 0. type = number 0 or 1 that indicates that the payments are due. 0 is given when the type is omitted and when it is the end of the period while 1 is given when the payments are due at the beginning of the period. guess = a guess number that is approximately close to the rate. If guess is omitted, it is assumed to be 10%.

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Mathematical & Trigonometrical functions The Mathematical & Trigonometrical functions in Excel enable the user to make certain calculations like finding the

Mathematical Function: FACT Fig.3.10.3(a) Video 3.10.6: SUMPRODUCT Function Table 3.10.2: Mathematical & Trigonometrical Functions square root, finding the sum of a set of numbers, finding the tangent of an angle, etc. Table 3.10.2 describes a few Mathematical & Trigonometrical functions in Excel along with the syntax for using those functions.

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functions. Statistical Function: Median

Trigonometrical Functions Fig.3.10.2(b) Trigonometrical Functions:TAN Statistical Functions Statistical functions in Excel help in summarizing, comparing and grouping data, and finding out the relationships between two sets of data. Table 3.10.3 describes a few statistical functions in Excel along with the syntax for using those Video 3.10.7: Statistical Functions Fig.3.10.3(a) Statistical Function: Median

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Table 3.10.3: Statistical Functions

3.10.4 Lookup & Reference functions Look up & Reference functions Video 3.10.9: LOOKUP Function

Lookup & Reference functions in Excel enable the user to look up for a particular row or column or find a specific reference in the w o r k s h e e t . Ta b l e 3.10.4 describes a few Lookup & Reference functions in Excel along with the syntax for using those Video 3.10.8: HLOOKUP Function Example Video 3.10.10: VLOOKUP Function Example

functions.

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Logical functions A logical function is used to evaluate an expression. The results are displayed in the form of logical operators like TRUE, FALSE, etc. These functions are usually used for making a comparison between two values. Table 3.10.5 describes the Logical functions in Excel along with the syntax for using those functions.

Table 3.10.4: Lookup & Reference Function

Table 3.10.5: Logical Functions

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are already stored in the database. Table 3.12.4 describes a few Date & Time functions in Excel along with the syntax for using those functions. Date Function

Table 3.10.6: Date & Time Functions Date & Time functions Fig.3.10.4 Date Function for (4/5/2012) Video 3.10.11: Date Function - Formulas

The Date & Time functions pertain to the date and time values and operations in Excel. Some of these functions can be used for displaying the system date, system time, etc., while the others can be used for changing or manipulating the date and time values that

Workout for formula and functions/logical: Formula.pdf, Excelfile: GRADESHT.XLS Workout for Financial functions: Mortgage.pdf, Excelfile: MORTGAGE.XLS Cost-Benefit Analysis.pdf, Excelfile: CBASTAD.XLS

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Workout for Statistical functions: Statistical Analysis.pdf Workout for Lookup function: LOOKUP.xls

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S ECTION 11

Charts & Graphs

Video 3.11.1: Creating Graphs in Excel Spreadsheet charts are diagrammatic representations of the data presented in a spreadsheet. Spreadsheet charts include column charts, bar charts, line charts and pie charts.

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Column charts: They comprise horizontal bars that show comparison of items. Column charts provide a ready comparison between separate items. These charts can also be used to show changes over time, usually known as time series. Bar charts: They comprise vertical bars that show comparison of items. Though not a good choice for time series, they are more useful in comparing items. Line charts: They are used in time series analysis to show trends or changes over different time periods. Pie charts: They are used to express the relative percentage of each portion as a part of the whole. They are used to Video 3.11.2: Creating compare parts of a Charts in Excel whole. For example, the population of Hyderabad as compared to that of Andhra Pradesh can be represented by a pie chart. In pie charts, values are explained in percentage terms. One can use pie charts to show relative percentages when the parts add up to make 100 percent.

Chart wizard The Chart Wizard directs the user in the process of creating a chart or modifying an existing chart. It takes the user through the process of creating a chart by asking him/ her to provide the various specifications like data range, chart type, chart format, how the data needs to be plotted, chart title, axis title, legend, etc. The chart wizard allows the user to create either an embedded chart or a chart sheet. An embedded chart is a chart that is placed and saved within the same worksheet where the data is located. A chart sheet is a new worksheet in which the chart is created. This chart is kept separate from the worksheet on which the data is given. Refer to the Gallery for Exhibits 3.11.1(a) - (f): Screenshots on Charts. Creating charts in spreadsheets Charts or graphs are visual representations of the raw data. They can be easily created and at the same time can be more easily understood than the raw data itself. Presenting data in the form of charts or graphs is more user friendly as compared to presenting the raw data. Based on the data that needs to be represented, one can create various types of charts like pie charts, line charts, bar charts, column charts, etc., using the spreadsheet software.

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Following is the procedure that a user has to go through for creating charts in spreadsheets: Enter data in a worksheet and highlight all the cells (including the headers) which should be included in the chart. To create a chart, go to the Menu bar and click on the Insert option. A drop down menu appears from which the option called Chart has to be selected. Alternatively, the user can directly click on the Chart Wizard icon on the standard toolbar. A chart wizard helps the user create a chart by showing a string of dialog boxes. The first dialog box appears asking the user to select the type of chart. After selecting the type of chart, the user has an option to select a sub-type of chart. For example, various sub-types of a pie chart include normal pie chart, a pie chart with 3D effects, pie of pie, exploded pie chart, exploded pie chart with 3D effects and bar of pie. Let us assume that the user wants to create a pie chart with 3D effects. The user then has to click on Next. The second dialog box that appears is a chart source data. This box asks the user to select the data range. After selecting the data range, the user has to click on Next. The third dialog box is the chart options. This box prompts the user to mentions titles for the X - axis and Y - axis respectively. Other chart options include

axes, gridlines, legend, data labels and data table. The user then has to click on Next. The fourth dialog box prompts the user to indicate the chart location, i.e., the place where the user wants the chart to appear. The box includes two options: whether the chart should be placed on a new worksheet or whether it should be included in the active or current worksheet. After selecting an option, the user has to click on Finish. Workout for Chart wizard: CHART WIZARD.pdf, GSS.XLS

GALLERY 3.11.1: Screenshots Gallery on charts

Exhibit 3.11.1(a)

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S ECTION 12

Pivot Table

Video 3.12.1: Building a Pivot Table

PivotTable A PivotTable is an interactive worksheet table that enables the user to combine and compare large amounts of existing data. The user can rotate the rows and columns of the table to obtain different summaries of the source data. The layout can be changed by providing headings to the rows and columns. A PivotTable can be updated whenever changes occur in the original data.

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After creating a PivotTable, the data can be rearranged, organized and analyzed by dragging and dropping fields in the PivotTable. The user can also include subtotals, change the summary function for a field, or select a custom calculation for the PivotTable.

Keynote 3.12.1 Pivot Table & Pivot

Chart

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S ECTION 13

What-If Analysis
Scenario Analysis A scenario is a tool which is used for planning the outcomes of data by modifying various cells in the worksheet. It is a specific set of values that can be saved in Excel and which can be automatically substituted in a worksheet. Excel can be used for displaying numerical data, which is relevant to a particular date, month, topic, etc. The Scenario Manager is used for entering various values into the worksheet and to forecast the outcome of the data. These values are retained for use in the future and are stored in a hidden part of the workbook. The values can be retrieved by the Scenario Manager to show the scenario that uses those specific values. Scenarios are generally used for predicting the future values. They are used for conducting a Best Case/Worst Case scenario regarding a situation. For

Video 3.13.1: Creating and Displaying Scenarios

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instance, Keynote 3.13.1: Scenario Manager scenarios can be used for budgeting. A budget consists of several variables that influence the financial performance of an organization. With the use of scenarios, the decision maker can try out different combinations of the variables and check their effect on the financial performance. He/she can enter and save the various groups or combinations of variables (called scenarios) in the worksheet and can then switch between them to carry out the what-if analysis. This way, one can get the best as well as the worst results for a particular scenario. Scenarios can be used for finding out the effect of changes in discount rates on the sales, interest rates on loan or investment, etc. Data Tables Data tables consist of a range of cells that display how altering some values in the formula will have an effect on the final results of the formula. These tables can be a one-variable data table or a two-variable data table. In a one-variable data table, either a row or a column that is part of the formula can be altered to find out the change

in the final results of the Keynote 3.13.2: Data Tables formula. In a two-variable data table, both a row and a column can be altered to find the change in the final results of the formula. Data tables are used for creating multiple versions of a single operation and enables comparison of these versions in the worksheet. One-variable data table: In a one-variable data table, the input values are either column-oriented (i.e, listed down a column) or roworiented (i.e, listed Video 3.13.2: Data Tables - 2 across a row). The formula used must refer to an input cell. Tw o - v a r i a b l e d a t a table: In a two-variable data table, the input values are both column-oriented (i.e, listed down a column) as well as row-oriented (i.e, listed across a row). This data table uses only a
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single formula but with two sets of input values. That is, the formula refers to two different input cells.

Video 3.13.3: Using Goal Seek in Excel

given break-even point, for finding out the discount rate on the products to get the required amount of profit, etc.

Keynote 3.13.3: Goal Seek Analysis

Goal-Seek Analysis

Goal seek analysis is the reverse of what-if analysis. It modifies the variables so that targets are met. In GoalSeek, Excel changes the value of a particular cell until the formula on which it is dependent gives the required result. Goal-Seek can be used if the user wants to know the interest rate that gives him/her the required amount of interest. Goal-Seek analysis can be used for finding out the price of a product based on the
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S ECTION 14

Linear Programming & Solver

Video 3.14.1: Introduction & Demo of Solver Linear programming using Solver The Solver is an optimization and resource allocation tool that helps in finding an optimal value to a cell called the target cell in a worksheet. In Solver, the target cell can be set to maximum, minimum, or a certain value. Also, the values in the changing cells (also known as the adjustable cells) can be adjusted to generate the result which is specified from the formula in the target cell. At the same time, constraints can be applied in order to restrict the value. For instance, solver can be used to find out the effect on the profit due to a change in the promotional expenses. Some situations where the solver can be used are scheduling, income maximization, product mix, routing, portfolio management, etc.

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Video 3.14.2: Data Analysis Tool pack in Excel

Keynote 3.14.1: Solver

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S ECTION 15

Regression & Trend Analysis

Video 3.15.1: Trend Lines and Regression Analysis

Microsoft Excel provides a set of data analysis tools called Analysis ToolPak. This is available as an add-in feature. These tools help the users to conduct complex statistical analyses within a short time.There are various tools available in the Excel Analysis ToolPak. One of the tools is regression. Trend analysis is one of the types of regression used for finding out the pattern and then use the pattern for forecasting purpose. The Regression procedure provides regression statistics, ANOVA, regression coefficients, their standard errors, t stat's, p values and upper and lower confidence values.

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Video 3.15.2 : Installing Data Analysis Tool Pack

Video 3.15.4: Regression Analysis using Excel

Video 3.15.3: Data Analysis Tool pack in Excel

Video 3.15.5 : Regression

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R EVIEW 3.1
Question 1 of 8
In Microsoft Excel, the formula: =3 + 5*6 would give

A. B. C. D.

33 48 23 An error

Check Answer

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S ECTION 16

Case Study: Athletics Authority of Indraprasthan

Athletics Authority of Indraprasthan (AAI) is responsible for organising the national athletic meet annually in the country. However this year, with approval from the Government, AAI decided to organise a regional athletic meet by inviting athletes from neighbouring countries. Mr.

Prabhu Kane, the Chairman of AAI and his team is currently busy planning for this prestigious meet scheduled in December (just four months away). Among other aspects to be planned, an important activity is organising balanced and nutritious diet for the athletes during their week long stay at

This case study was written by Prof. L. Shridharan, Department of Decision Sciences, IBS, Hyderabad. It is intended to be used as the basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation. The case was written from generalised experiences. 2009, IBSCDC. No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever without the permission of the copyright owner.

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the national capital, the venue for the event. With athletes expected from neighbouring countries, Mr. Kane is very clear that there should be no compromise on the diet aspect. Mr. Kane asked Dr. Rohit Mathur, the nutritionist at AAI, to personally take charge of the matter and organise the purchase of foods in an efficient manner. Specialised foods for athletes have a limited market. Hence there are only two suppliers in the country. The other option is to import, but that is a costlier option. Kher & Associates Limited (K & A), a hospitality firm specialising in nutritive diets, is located in Navi Mumbai and produces eight sports foods. Chawla Sports Foods Limited (CSFL), a Chandigarh based firm, produces six types of sports foods. Mr. Arjun Kher, CEO of K & A, is elated at the possibility of getting an order to supply food items for athletes in the forthcoming athletic meet. And so is Mr. Deepak Chawla, CEO of CSFL. Dr. Mathur began his task earnestly. Based on his professional knowledge, he identified six nutrients considered important for athletes, along with the per day minimum requirement levels of each nutrient (Exhibit I). These nutrients were Energy, Protein, Carbohydrates, Calcium, Iron and Fat. On enquiry from Dr. Mathur on behalf of AAI, both the companies supplied the composition of respective foods manufactured by them and each recommended a combination of their respective foods that would meet the daily nutritional requirements of the athletes. Each company also indicated the prices of their respective foods (Exhibit II and Exhibit III). However, Dr. Mathur was not sure that the recommended quantum of foods (by each company) would meet the efficiency

objective set by Mr. Kane. Dr. Mathur vaguely recalled from his college studies that there is a scientific way of handling such a situation, but he is unable to recall the details. Could you help him? Having resolved the problem with your help after a weeks joint struggle, Dr. Mathur was very happy to report the same to Mr. Kane the very next morning. However, Mr. Kane felt that Mathur should be addressing the problem head on, by identifying the worth of the nutrients within the given limitations for each of the companies. This query once again put Dr. Mathur back on a recall track of his graduation lessons without success. Could you help him once again?

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Exhibit 3.16.1 Per Capita Nutritive requirements per day Nutrients Requirements per day Element Energy Protein Unit K.Cal. Gms. 3800 60 560 20 400 28

Exhibit 3.16.2 Nutritive Composition and Prices of different Foods: Kher & Associates Limited Nutrients per 100 grams of each Nutrients Food Element Energy Protein Carbohydrate Fat Unit F1 F2 F3 F4 97 F5 F6 F7 F8

K.Cal. 342 432 27

26 348 65 32

Gms. 11.1 43.2 1.8 1.6 1.7 24.1 1.6 0.6 Gms. 66.2 20.9 4.6 22.6 4.5 6.3 14.5 7.2 Gms. 3.6 19.5 0.1 0.1 0.1 25.1 0.1 0.1 10 50 790 10 17

Carbohydrate Gms. Fat Calcium Iron Gms. Mgms. Mgms.

Calcium Mgms. 10 240 39 Iron Price per kg

Mgms. 2.3 10.4 0.8 0.48 0.61 2.1 1.79 0.5 INR 26 45 12 10 15 130 17 11

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Exhibit 3.16.3 Nutritive Composition and Prices of different Foods: Chawla Sports Foods Limited Nutrients Element Energy Protein Carbohydrate Fat Calcium Iron Price per kg Unit Nutrients per 100 grams of each Food F1 F2 335 F3 21 F4 25 F5 F6

K.Cal. 349

567 729 0 0

Gms. 10.4 22.3 2.1 Gms. 72.6 57.6 2.5 Gms. 1.9 1.7 73 2.7 55 0.3 50

1.6 25.3 4.2 26.1

0.2 40.1 81 20 90 0 0

Mgms. 25 Mgms. 4.1 INR 18

2.4 0.61 2.5 27 15

52 210

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S ECTION 17

Case Study: Consultants Negotiating Game

Sunaina Singh (Singh) was a consultant by profession. Singhs client, Mr. Naveen Murthy, wanted to implement an enterprise resource planning (ERP) package in his organization to streamline the business processes and to create a common shared database throughout the organization. However, some

of his employees were not too happy about the implementation of ERP. There were four functional departments in the organization Marketing, Operations, Human Resources, and Finance. Each department maintained its own records and data in its own way, with a sense of

This case study was written by Kartikeya P Bolar and reviewed by Saradhi Kumar Gonela, IBS Hyderabad. It is intended to be used as the basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation. The case was compiled from published sources. 2012, IBSCDC. No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever without the permission of the copyright owner.

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autonomy. The new idea of a uniform database through the implementation of an ERP package caused resentment among the employees. The departments, as such, also had diverse opinions on the matter. Mr. Murthy hired Singh to resolve the differences among the employees and to break the resistance to the new idea by counseling and advising them. Subsequently, Singh devised a game to help the employees realize the importance of Mr. Murthys idea. The game required an analytical and computing tool, such as Excel. It consisted of 10 rounds and in each round, four teams had to decide on whether to place X or Y (Refer to Exhibit 3.16.1 for spreadsheet). The scores for each round for each of the teams would be calculated based on a Payoff table (Refer to Exhibit 3.16.2 for payoff table). The third round score, fifth round score, and the tenth round scores would be multiplied by 3, 5, and 10 respectively and the consolidated score then assigned to the teams in the corresponding rounds. Singh interacted with the employees of all four departments and was successful in convincing them to accept the ERP implementation.

Exhibit 3.16.1

Exhibit 3.16.2 Payoff Table

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Note: 1. Data in brackets have to be entered manually. 2. Teams will discuss at the end of 3rd, 5th, and 10th rounds only. QUESTIONS FOR DISCUSSION: 3. Assess and interpret the business sense of the game. 4. Develop the spreadsheet by entering relevant formulae. 5. Find the total score for each of the teams and the maximum and minimum total scores (as shown in Exhibit I).

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C HAPTER 4

Database Approaches to Data Management

Source: http://zone.ni.com

S ECTION 1

Database Management Systems

Data is a raw form of facts and is unformatted and unprocessed information. Data constitutes the building blocks of information. A database is a well-organized data in an integrated computer structure. It houses a collection of data of end-user and also metadata, which describes the data characteristics and the relationships between the different data sets. A database is a collection of related data that is organized to make access easier. Data management deals with proper generation, storage and retrieval of data. The database management system (DBMS) consists of interrelated data and a set of programs to access the data. DBMSs were first introduced during the 1960s and since then it has undergone a lot of changes. The primary goal of DBMS is to provide a convenient and efficient environment for storing and retrieving information in a database. The DBMS is a software that enables the programmer and administrators to create, delete, store, retrieve, organize, interrogate and maintain databases so as to enable instant and hassle-free access

Source: http://insidetech.monster.com

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to requisite Video 4.1.1: Database information to the Management System end users and their organizations. It involves the definition of structures for data storage and the provision for manipulation of data. It also ensures system security, preventing data loss due to system failure and unauthorized access. The DBMS software is responsible for the creation, maintenance and use of database systems in an organization. In the DBMSs, the data records are consolidated into databases that can be accessed by different application programs. The DBMS serves as an interface between users and the various databases. This helps the users access data easily. The most typical DBMS is a relational database management system (RDBMS). Microsoft Access is a popular example of a single or small-group user DBMS. Microsofts SQL Server, Oracle, MySQL, etc., are examples of a DBMS that serves multiple-users. How does a DBMS solve the problems of the traditional file environment: Prior to the advent of the Database Management System (DBMS), organizations stored data in a fileprocessing system, which followed electronic file processing approach to store and manipulate data. In a

file-processing system, records are stored in various files. In order to extract, add, or delete records in a particular file, various application programs need to be written. The file-processing system has certain disadvantages like difficulty in accessing data, duplication of data, large storage space being required and other security related problems. Since data was stored on the tapes as long and sequential computer files, any slight modifications in the data had to be made in all the files that contained the data. These difficulties led to the development of the DBMS.
Table 4.1.1 Different Terms Used in Different Models:

Entity-Relationship model is useful for database design and consists of entities, relationships and attributes as the basic elements or constructs. An entity consists of basic objects or concepts about which data is collected and stored. These may be places, people, objects, events, customers, orders, or something abstract like a loan or a holiday. Employees, invoices, projects, etc., are examples of entities. In the relational model, an entity is equivalent to a table. Entities can be classified based on whether they are independent or dependent. In certain
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instances, they are also referred to as strong or weak. An independent entity is one which does not depend upon another entity for identification while a dependent entity depends upon another entity for identification. The occurrence of an entity, also known as the instance of an entity, is an individual occurrence of an entity. In the relational model, an occurrence is equivalent to a row while an attribute is equivalent to a column. A relationship represents the association between two or more entities. It can be defined as the way in which data is shared between these entities. For example, an organization consists of many departments. Each department consists of a number of employees. Each employee is identified with an employee identification number. Relationships are classified on the basis of degree, connectivity and cardinality, direction, type and existence. The degree of a relationship refers to the number of entities that are associated with the relationship. Binary relationships (relating two entities), ternary relationships (relating three entities), N-ary relationships (relating N number of entities), etc., are the different types of relationships classified on the basis of degree. When an entity is related to itself, the relationship is termed as a recursive relationship. Connectivity refers to the mapping of related entity occurrences in the relationship. These can be one or many. Cardinality refers to the actual number of associated instances for each of the two entities. Three types of relationships based on connectivity take place between entities. These are one-to-one, one-to-many and many-to-many relationships. One-to-one or 1:1 relationships take place when one instance of an entity P is associated with

one instance of another entity Q. For example, the employee name (P) is associated with the identification number (Q) of the employee. Also, the identification number of the employee can be used to identify the employee name. One-to-many or 1:N relationships take place when one instance of an entity P is associated with zero, one, or many instances of another entity Q. However, entity Q has an association with only one instance of entity P. For example, a department (P) consists of a number of employees (Q). All these employees (Q) belong to only one department (P). This relationship is also called the many-to-one or N:1 relationship. Many-to-many or M:N relationships take place when one instance of an entity P is associated with zero, one, or many instances of another entity Q. And, one instance of entity Q is associated with zero, one, or many instances of entity P. For example, in an organization, a single project (P) can be assigned to many employees (Q) and at the same time, a single employee (Q) can be assigned to many projects (P). This relationship is also called the N:M or non-specific relationship. The direction of a relationship indicates the flow of relationship from the originating entity to the terminating entity. In a relationship, the entity from which the relationship commences is called the parent entity while the entity at which the relationship concludes is called the child entity. The connectivity of a relationship decides the direction of the relationship. For example, in a one-to-one relationship, the direction flows from an independent entity to a dependent entity. In one-to-many relationships, the direction always flows from one side to
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many sides, only once to the parent entity. The direction will be an arbitrary one in situations where both the entities are independent or in case of Video 4.1.2 : Databases many-to-many relationships. Converting E-R model to a database model: The E-R model should be converted to a model which can be used directly in a database. Therefore, we need to convert the E-R model to a relational model. The relational model consists of relations, tuples and attributes. A relation is a two dimensional table which is made up of tuples. A tuple in the relational model is a row in a database. It is made up of one or more attributes (or columns in the database model). Attribute is a characteristic or a property of the relation contained in a tuple. Table 1 gives the different terms which are used by different models. In most of the E-R models, entities and weak entities get easily converted into relations. Each entity gets directly converted to a relation. The entity instances in the entity become tuples in the relation. The attributes in the entity become the attributes in the relation. The identifier in the entity becomes a key in the relation. If a weak entity is not dependent on the identifier (key), then it should be treated like any other.

The E-R model is based on various structures. These structures are formed out of the entities and they define the relationships between those entities. Refer to Figure 8.8 for the various structures. For a database designer, the E-R model: Goes well with the relational model. The constructs used in the model (entities and relationships) can be transformed easily into relational tables. It is simple and can be easily understood by the end user. It requires minimal training. It can be used as a design plan for implementing a data model in database management.

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S ECTION 2

Relational DBMS and Its Operations

Earlier, databases were designed based on the network (collection of records that is organized as collections of arbitrary graphs) and the hierarchical (collection of records that is logically organized to conform to the upside-down tree structure) models. In 1970, Edgar F. Codd proposed the relational model. This model gained prominence over the years and began to dominate the data processing applications scenario in business organizations. The Relational Database Model, also known as the Relational Database Management System (RDBMS), is based on the concept of tables or relations. In this model, the data is organized in the form of two-dimensional tables, representing data and relationships. Each row of a table corresponds to a record, while each column corresponds to a field. Unique keys or primary keys are used to access records in a table. The fields contain attributes like employee ID, employee name, age, etc., while a row (also known as a tuple) identifies the details pertaining to a single instance like the details of a particular employee, say, Nikhil. In relational databases, each row is distinctive and each column has a unique name. Each row has a key that identifies the row with the relation. Data records stored in tables can be accessed using a primary key. The primary key is a field in a record that is used to distinguish a record from other records in the table. For example, employee number will be the primary key in the employee table. Thus, relational databases allow the designating of certain fields as keys to facilitate specific field value search, i.e., when two different tables constitute the same field values, a single operation can be performed by matching the field values to select the related records in the two tables. At times, the fields will be referred to by the same name in both the tables. For instance, a table containing the personal details of the employees will have a field for employee ID. A table containing the official details of the employees will also have an employee ID field. This

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employee ID field can be used as a medium for relating the two tables. Another example is linking a customer file and an accounts receivable file by using a common field, such as the customer account number field. The user can then request a report consisting of fields from both the customer and the accounts receivable records. This facility offered by relational databases can also be extended to relate multiple tables. Relational databases also have keys called foreign keys. These keys are primary keys of one table which can be included in another table for relating or joining the data. For example, the social security numbers of the father and mother can be used to represent their child. In this example, the social security number of the father and/or the mother acts as a primary key in a table that represents them while it acts as a foreign key in the table which represents their child. Relational database management systems like DB2, Microsoft SQL Server, Oracle, Informix, Sybase SQL Server, Ingres, SQLite, Access, etc., are based on the relational model. Normalization of data: Normalization is a technique used for designing relational databases. It refers to the optimization of tables to remove any redundancy and scalability issues that might arise when the amount of data is increased. It is a two-step process which involves arranging the data in a tabular form after deleting the repeating groups and the duplicated data from relational tables.

The process of normalization is based on the concept of normal form. A relational table is said to be in a normal form if it satisfies a set of constraints. A database can be normalized up to six normal forms but most databases
Table 4.2.1(a): Table Not Complying with the Second Normal Form
Student Course ID ID 111 223 112 113 114 115 116 117 118 119 120 224 225 226 227 225 224 223 226 227 Percentage Obtained 70 60 85 75 65 55 56 87 62 78 Course Title Data Warehousing SQL RDBMS C and C++ Java RDBMS SQL Data Warehousing C and C++ Java

are only up to the third normal form. To be in the first normal form, every table must have a primary key, which is a column (or set of columns) that uniquely identifies each row. Usually, each table contains only one primary key. Sometimes, there can be more than one primary key in a table. In such situations, one key is selected as the primary key; the others are called alternate keys. To be in second normal form, the table should be in the first normal form and there should not be any partial dependency, i.e., all the non-key fields (fields that are not primary) should be functionally dependent on the full primary key. Refer to Table 4.2.1(a) for an example of a table that does not comply with the second normal form.

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Table 4.2.1(b): Table Complying with the Second Normal form:

Table 4.2.2(a) : Table not Complying with the third normal form:

In Table 4.2.1(a), student ID + course ID is the primary key on which the percentage and the course title are dependent. The course title functionally depends only on the course ID (part of the primary key) rather than on the full primary key. Therefore, this is a situation of a partial dependency. In order to convert the table into the second normal form, it should be split into two as given in table 2(b). One table would contain only the student ID, the course ID and the percentage obtained while another would contain the course ID and the course title.

In Table 4.2.2(a), customer ID is the primary key on which the customer, salesperson and the zone are dependent. However, there is a transitive dependence between salesperson and the zone. For instance, the salesperson Sally is available in the Southern zone. Whenever, a customer calls from the Southern zone, Sally is the salesperson who attends to the call. In the given situation, James and Harry are customers who belong to the Southern zone and therefore Sally attends to their calls.

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Table 4.2.2(b): Tables Complying with the Third Normal Form

To convert the table into the third normal form, the table should be further split into two as given in Table 4.2.2(b). One table would have the customer ID, customer and the salesperson while the other would have the salesperson and the zone.

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S ECTION 3

Capabilities of DBMS
DBMS reduces d a t a redundancy and improves productivity and concurrency. In a DBMS, data is integrated and can be accessed by multiple programs and users. In a DBMS, simple Source: http://www.adroitglobalnetwork.com queries can be used to obtain information. Therefore, there is no need to write programs. The DBMS approach reduces the costs involved in data maintenance. Managing data in databases augments maintenance through data independence. In a DBMS, data is stored in databases which are reliable and secure. Database management enhances the accessibility and responsiveness of the data. The DBMS approach enables better data sharing and avoids duplication. The DBMS helps in effectively managing huge volumes of interrelated data. Any changes made in the data are reflected in every location at which the data is recorded. The DBMS also helps in preventing data redundancy. Different applications in banking, such as check processing, savings accounts, bank credit cards, automated teller systems and loan accounting require such activities to be done on a regular basis. The entire data related to the customers can be consolidated into a common customer database. The DBMS enables frequent updation and maintenance of databases so that they reflect new business transactions. The DBMS supplies information to the end users through application programs. These programs share the data that are stored in the common databases. Also, the end users need not know where and how the data is physically stored. The DBMS provides inquiry and reporting capabilities to the end users. These facilities enable the end users

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R EVIEW 4.1
Question 1 of 3
The Database Management System (DBMS) i. Serves as an interface between users and the various databases. ii. Helps the users to access data easily. iii. Enables the programmers and administrators to create, delete, interrogate and maintain databases to provide requisite information to the

A. B. C. D.

Only i and ii Only ii and iii Only i and iii i, ii, and iii

Check Answer

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C HAPTER 5

Building Information System Using MS Access

Source: http://www.techbubbles.com/

S ECTION 1

Tables, Queries, Forms and Reports

Microsoft Access 2007 is a Video 5.1.2 : How to RDBMS used to store and ma- make a relationship nipulate large amounts of data. between two tables in MS Access The data is stored in multiple tables and relationships between the tables help in data retrieval. The important database objects of Access 2007 are tables, queries, forms and reports. Tables
Video 5.1.1: Working with Tables

Keynote 5.1.1: Creating Tables and Relationships

Table is a collection of data about specific theme such as product, customer, student, etc. Data is organized into columns (fields) and rows (records or tuples). In the datasheet view, user can add, edit or view the data in the table. In the design view, user can create the entire table from scratch.

Video 5.1.3 : Creating a

Video 5.1.4: Adding

Table

Relationships Between Tables

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Query is a statement used to fetch/retrieve data from the database. It can be used as a source of records for forms and reports.

Video 5.1.5: Creating a

Simple Select Query in MS-Access

Forms Forms are used to enter or modify data in a database. Ms Access has a form wizard to create forms. Video 5.1.6: Working with forms

Keynote 5.1.2: Creating Queries

Keynote 5.1.3 : Creating Forms

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Reports Reports are similar to forms. However, it can be used only to view and print data. Reports can be created using a report wizard and choosing either tables or queries as source. Video 5.1.7 : Using the Report Wizard Video 5.1.8: Creating Reports in MS Access 2010

MS Access 2007 Application Development Video 5.1.9: How to create a login form in MS Access

Video 5.1.10: Creating Barcodes in MS Access 2010 Keynote 5.1.4: Creating Reports

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Video 5.1.11: MSAccess Tutorial - 1

Video 5.1.13: MS Access Tutorial -2

Video 5.1.12: MS-Access Tutorial - 3

Video 5.1.14 : MS Access Tutorial - 4

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R EVIEW 5.1

Question 1 of 3
A __________ enables you to view data from a table based on a specific criterion

A. B. C. D.

Form Query Report Table

Check Answer

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C HAPTER 6

Information Security Systems

Source: http://computerforensicsmanagement.com

S ECTION 1

Introduction
Information systems security looks into all aspects of safeguarding information of data in whatever form it is presented. The US National Information Systems Security Glossary defines Information systems security as modification of information whether it is being stored, processed or transmitted against the denial of service to authorized users, or providing the service to unauthorized users, including the steps necessary to find out, document and counter such threats. It covers not only information but all infrastructures which facilitate its use such as processes, system, services, technology, etc., including computers voice and data networks, etc. No one can ever completely eradicate all risk of improper us of information. The level of information security sought in any particular situation should commensurate with the value of the information and the loss, financial or otherwise, that might accrue from improper use disclosure, degradation, denial, etc. The three important attributes of information security are confidentiality, integrity and availability.

Source: http://www.blog.gurukpo.com

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S ECTION 2

Information System Vulnerability and Computer Crime

to commit a crime. Usually Video 6.2.1: Computer in these crimes, a Crime computer is always targeted. Criminals will work out different ways to perform following criminal activities such as a fraud, theft, blackmail and forgery using the powerful medium internet. Intangible property cannot be stolen and the damage caused must be visible. Denial of service attacks, yet, for the purposes of extortion may result in significant damages, both to the system and the profitability of site targeted. Issue around hacking and copyright theft have become high-profile now. When confidential information is lost such as an e-mail is captured through illegal hacking, legitimate monitoring at

Source: http://img.ehowcdn.com

Let us understand computer crimes. We can define a computer crime or electronic crime as the means adopted

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workplaces or is simply read by an unauthorized person, problems of privacy are found. Second, criminals are using the computer as a tool to commit a crime, such as the distribution of child pornography, and the growth of the internet has made these crimes both more common and more difficult to police. Criminals are working against encryption techniques and exchanging data with few opportunities for the police to monitor and stop. Hence standard warrants for search and telephone tapping are required to be modified. Third, a computer is regarded as a source of evidence. If any evidence can be obtained and subsequently decrypted, it will be helpful to criminal investigators. Hacking Hacking is gaining an unauthorized access to information systems deliberately and it may amount to a notional security crime when the defendant accesses sensitive information. Let us Source:http://1.bp.blogspot.com look into some external threats now. Some people wish to break the system from outside to access sensitive information, or

internally some employees wish to steal some confidential information from their employers while leaving the organization. It will cause substantial cost and inconvenience to the organization. For example, the development of computer viruses such as the love bug, worms and Torjans represent some major threats to the systems. Let us look into some less obvious threats such as telephone hacking or phreaking, which is gaining an authorized access into an organizationss telephone network in order to make free long-distance calls. Hacking frequently involves people who operate from many states. Fraud We can define fraud as any dishonest misrepresentation of facts intended to induce another to do or refrain from doing something, which will cause losses. Hence in this context the fraud will result in obtaining a benefit by

Altering a computer input in an unauthorized way. This will require a little technical expertise.

Source: http://lawincyber.files.wordpress .com

Altering, destroying or stealing the output usually to conceal unauthorized transactions.

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Altering or deleting stored data. Altering or misusing existing system tools or software packages or altering code for fraudulent purposes. It requires thorough programming skills and is not very common. Some people will manipulate banking systems to make unauthorized electronic funds transfers and it would be considered as serious thefts. An increasing problem is the unauthorized use of credit card numbers and other data collected as part of the identity theft. Piracy In United States, most states passed laws to protect copyrighted materials and people who a r e distributing a n d downloading Source: http://cybernetnews.com copyrighted materials without permission are liable to face civil actions for damages, penalties and which may also lead to criminal prosecution. According to English law, Designs and Patents Act 1988 recognizes Piracy as

offense when a person without the permission of the copyright owner does the following act(s): Makes unauthorized copies by burning music files or films on a CD-R or a DVD-R. Distributes and sells or hires out unauthorized copies of CDs, VDs and DVDs. Distributes unauthorized copies on a larger scale as a commercial enterprise on Internet. Possesses unauthorized copies with a view to sell, distribute or hire out to other people. While not dealing commercially, distributes unauthorized copies on such a scale as to have a measurable impact on the business of the copyright owner. The penalties for these copyright offenses will depend on the seriousness of the offense. Pornography In the United States it may be legal or illegal for adults to read or view obscene material and it depends on the rules of state or residence. In most states, child pornography is regarded as illegal. Even if the pornography is not illegal per se, it may be considered harmful or distressing for others to see, whether coming across it unexpectedly as adults or as children. The various offenses are related to possession, storage and distribution of obscene material, although some states do not criminalize mere possession as long as there is no attempt to show it to others and if the distribution is not
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for any gain. But child pornography, which features the sexual abuse of children, is often considered so serious that mere possession is an offense. The general test of obscenity is whether the material tends to corrupt those who are likely to read, see or hear it. Harassment While content my be offensive in a non-specific way, harassment directs obscenities and derogatory comments at specific individuals focusing on gender, race, religion, nationality and sexual orientation. Often this will occur in chat rooms, through new groups, and by sending hate e-mails to interested parties. All forms of unsolicited e-mails and advertisements an also be considered to be forms of Internet harassment where the content is offensive or of an explicit sexual nature. Now termed Spam, it has been criminalized in various countries. Computer Virus We can define a computer virus as self-replicating/selfreproducingautomation program, which spreads by inserting copies of itself into other executable codes or documents. It behaves like a

biological virus, which Video 6.2.2: Viruses, spreads by inserting itself Worms and Botnet intoliving cells. By Explained extending the analogy, when a virus is inserted into a program, it is termed as an infection and the infected file is called a host. Viruses are regarded as one of the several types of malicious software. The term virus is often extended to refer to worms, Trojan horses and other sorts of malicious software. Let us understand a basic rules that a computer virus cannot directly damage hardware, but only software. While viruses can be deliberately destructive, may other viruses are merely annoying. Some viruses have delayed payload, which is called a bomb. For instance, on a specific day a virus might display a specific message or wait until it has infected a specific number of hosts. A time bomb occurs on a specific date or at a specific time, and a logic bomb will occur when the user of a computer takes an action that will trigger the bomb. However the negative effect of viruses is their uncontrolled selfreproduction, which wastes computer resources. As of 2006, viruses are less common than network-borne worms, due to the popularity of the internet. Anti-virus software, which is initially designed to protect computers from viruses, has a turn expanded to cover worms and other threats such as spyware.
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Source: http://2.bp.blogspot.com

S ECTION 3

Protecting Information Systems

Encryption I n c r y p t o g r a p h y, encryption is defined as the process of converting information into a form which cannot be read or understood by unauthorized people/ users. For centuries, while encryption has been used to protect communications, only organizations and individuals with an extraordinary need for secrecy had used it. In the mid-1970s, strong encryption emerged from the sole preserve of secretive agencies into the public domain, and is now employed in protecting widely-used systems such as e-commerce, mobile telephone networking and bank automatic teller machines. Video 6.3.1: Antivirus & Internet Security Cartoon

Source:http://1.bp.blogspot.com

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We can use encryption to ensure secrecy, but we still need other techniques to make communications secure, particularly to verify the integrity and authenticity of a message; for example, a message authentication code (MAC) or digital signatures. Another consideration is protection against traffic analysis. Encryption is also used in software copy protection against reverse engineering, unauthorized application analysis, cracks and software piracy used in different encryption. Disaster Recovery Planning A disaster recovery plan is defined as a comprehensive statement of consistent actions to be taken before, during and after a disaster. We should then document and test the plan to ensure the continuity of operations and availability of critical resources in the event of a disaster. The primary goals of disaster recovery planning is protecting the organization in the event that all or parts of its operations and/or computer services are rendered unusable. We can say that preparedness is the key. The planning process minimizes interruptions in operations, ensures some level of organizational stability and an orderly recovery after a disaster. Other objectives of disaster planning are mentioned as under: Providing a sense of security Minimizing risk of delays Guaranteeing the reliability of standby systems Providing a standard for testing the plan Minimizing decision-making during a disaster

R EVIEW 6.1
Question 1 of 3
______can be defined as a self-replicating and self-reproducing automation program that spreads by inserting copies of itself into other executable codes or documents.

A. B. C. D.

Computer Virus Encryption Piracy Hacking

Check Answer

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C HAPTER 7

Current Trends in Information Technologies and Systems

Source: http://business.mega.mu

S ECTION 1

Present Scenario and Mega Trends

Disruptive changes always throw up entirely new opportunities. Howard Elias, President & COO, EMC Corporation information infrastructure and cloud services in his interview to the Economic Times (29th March, 2012) says that this is the first time in the history of information technology that there is disruption in every part of the technology stack. Infrastructure, applications stack, client access and the data are the four layers. In the last five decades of IT development, there were changes in many parts of the four layers, but never simultaneously and never in an extremely short span of time.
Source: http://www.investigativeproject.org

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Cloud computing has brought major changes in the infrastructure layer.There are new frameworks in the applications layer that enable agile development for cloud and scales all at the same time. In client access, the CIO (Chief Information Officer) is flooded with a wide range of devices. Largest changes are taking place in the data side. Unstructured data is growing at an exponential rate while they are generated from both inside and outside the organizations. Many organizations always face the dilemma of as to how much money they should spend on maintaining existing infrastructure as compared to developing new business value for the company. In the past few years, growth in the IT industry has been driven largely by the new generation of Source: http://www.combridges.com companies such as Google, Facebook, Twitter and Apple. Huge volumes of data generated by such growth and development are also being thrown at the CIO of a typical global organization. Additionally, there are new norms in the increasingly regulatory and

compliance environment. Combined effect of all these factors can lead to an entirely new scenario. Every organization wants to spend more money on new applications development and not just on maintenance as it used to happen in the past. The new generation of companies has created new ways of developing applications, accessing them and creating Source: http://www.hewitt-times.org entirely new data. They also want to gain entirely new insights in the backdrop of high growth in data volumes and also the different types of data. All these mega trends are somewhat converging to create entirely new possibilities. In every organization there are some people who understand the business and some who understand technology. If left unattended, this can lead to gaps which will not be productive. The gap between these two sets of people has to be bridged and that is the only way you can create high business value. This new opportunity can be fully exploited by the data experts (data scientists) to help bridge the gap. It goes without saying that such attempts will require changes in people
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and processes. The role of a server architect could change to that of a data center architecture cloud architect. In the earlier days, the provisioning expertise was required to purchase a server computer. Now it leads to provisioning a server virtually. Even IT could be provisioned as a service. All the layers (data, infrastructure, application and client access) have to work in sync to take maximum advantage of the new approaches. Thus there is a paradigm shift in IT. Earlier changes have helped IT evolve from large main frames to mini computers and later to client server and web-based computing. While the above changes were important, IT skills had to change. But the paradigm was still applications on top of a piece of infrastructure delivering some capability in that silo. Now the change is not just the change in underlying technology in one portion of the stack, but in the entire paradigm. The new paradigm implies that IT is treated as a service, progressing from the physical siloed world to a virtual cloud world. It is not just a change in technology. It is a major change in the way of thinking; how you architect, design, build, operate and use that IT. These changes are visible through three major trends: (1) Cloud computing (2) Business Analytics/Intelligence (3) Social Networking & Social Media We shall discuss each of them in separate sections.
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S ECTION 2

Cloud Computing
Cloud computing is a headway of computer advancement that uses the World Wide Web and central servers to carry on services that results into an efficient computing system through high-speed processing. Cloud computing can convert our way we plan, construct, and distribute applications/services. There is no single definition for Cloud Computing. Different IT professionals develop their own explanations about cloud mechanism and its usage. One of the most reliable descriptions about cloud computing is given by The National Institute of Standards and Technology (NIST). According to it, "Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications and services) that can be rapidly provisioned and released with minimal management effort or serviceprovider interaction.

Source: http://i.istockimg.com

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include creating Google sites thus giving some flexibility/ customization to the user to create their own sites. Infrastructure include hard ware and software maintenance as in Redbus.in on Amazon (however software is developed by redbus.in). Applications consists of Gmail using only email application without much customization. It offers a variety of works to cloud users. Some of its popular usages are information contact, stockpile services, etc. This also portrays delivery form of some IT services supported by a set of web protocols. The end result of the cloud computing is an easily reached website on the World Wide Web. Cloud users are provided with numerous services or applications through the Internet. Data and Information are stocked up on servers at an isolated place. Normally, the main characteristic of cloud computing is its ability to expand (scalable) and often use practical Source: http://www.vedainformatics.com resources. Spending on a latest communication, training instruction, multiple license software, or appointing new human resources is not needed in cloud computing. This actually encompasses a "pay-per-use"

service, as we pay only what we utilize. In simple words, Cloud computing is a progression of our technology that uses the World Wide Web and main servers to continue the services. This technology permits for more well-organized computing system capable of high-speed processing and bandwidth. There is a considerable work efficiency with cloud computing because home/office-based computers would not do all the complicated setting up of numerous applications. It is the growing bandwidth power of Internet which has enabled us to enter the cloud computing era. This new model of computing essentially implies that an organization or consumer can access and obtain the computer processing power and many software applications over the Internet. There is no need to incur capital expenditure Source: http://cloudcomputingcompaniesnow.com in buying hardware equipments and software. According to Gartner research, Cloud computing market was worth $160 billion in 2011. Both hardware and software companies are contributing to the development of cloud computing models. Hardware manufacturers such as HP, Dell and IBM are building large scale cloud computing centers which provide processing power, data storage facilities
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and high speed Internet connections to all the client organizations, who depend primarily on the Internet for business software applications. Software firms such as

Source: http://www.ngoilgasmena.com

Google, Microsoft, Oracle, SAP and SalesForce.com offer software applications as services delivered over the Internet. Google Apps is a common example which is essentially a complete suite of Internet-based desktop software applications such as word processing, spreadsheet and calendars. SalesForce.com customer relationship management software is offered on Apple iphone. The hardware in the cloud computing environment consists of remote servers and client machines. The client machines could be desktop PCs, laptops, tablets, cellphones, smart phones (iPhones, Blackberry), etc. Apart from Internet, Wi-Fi and wireless broadband, cellular networks also figure in this environment. Software as a service firms provide the system integration services to clients while large server

firms house the remote enterprise database servers. Since the new cloud computing environment does not use its o w n infrastructure, hence there is no need for making huge investments in h a r d w a r e a n d Source: http://techsol.tnlexperts.com software assets on part of the end users, i.e, customers. Instead, they buy the computing services from remote service providers and hence have to only pay by usage. This type of subscription-based billing is also called ondemand computing or utility computing. Cloud computing can be attractive to small and medium enterprises (SMEs) as they usually lack the financial muscles to make huge investments in hardware/software. But sometimes complex proprietary solutions supporting unique business processes may give competitive advantage to some large corporations, which could be another hybrid computing model where organizations will use their own infrastructure for their mission critical applications and adopt the cloud computing model for systems that are routine and less critical. Thus cloud computing invariably leads to more flexible infrastructure: part of which is owned by the organization and the other part rented from large computer centers owned perhaps
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by the hardware Video 7.3.1: Awesome vendors.Since the entire ID Cloud Computing Explained with Animation infrastructure has many components such as hardware, operating systems, enterprise software applications, networking, system integration, data storage and management, and different Internet platforms, many service provider companies have to adopt total solution provider approach as they may not be able to survive by providing merely one or two components mentioned above.

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S ECTION 3

Case Study: Better off in the Cloud Case of Bajaj Finance Limited

The Indian financial services industry had undergone a metamorphic change, thanks to the widespread use of information technology (IT) for a variety of services. Like any other service industry, the financial service industry was also customerfocused. The basic tenet of any financial service industry was to consider the customer as king and to satisfy his/her requirements to the fullest. This necessitated the

design of innovative financial products suited to the varied riskreturn requirements of the customer.However, the financing business was a low margin, high volume industry where scalability was often the key factor as customer volumes increased exponentially due to various reasons. Along with the volume factor, this business also required dexterity as faster processing of financial products such as

This case study was written by Sindhuja P N and reviewed by R Muthukumar, IBS Hyderabad. It is intended to be used as the basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation. The case was compiled from published sources. 2012, IBSCDC. No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever without the permission of the copyright owner.

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personal loans was always expected. To meet the dynamic needs of the market, the use of IT for customer service progressed by leaps and bounds. Toward this end, the financial service industry moved on to the cloud1 too. In January 2010, Devang Mody (Mody), head of sales finance & cross selling at Bajaj Finance Limited, was feeling happy and satisfied as he had been able to considerably reduce the time taken to process applications for consumer finance from 45 minutes to just 5 minutes by using cloud computing. BACKGROUND NOTE Bajaj Finance Limited (BFL), formerly Bajaj Auto Finance Limited, a diversified non-banking financial company, was engaged primarily in the business of financing. It provided twoand three-wheeler financing, consumer durables financing, personal loan cross-sell, personal and small business loans, vendor financing, mortgages, construction equipment finance, and infrastructure finance. During the fiscal year ended March 31, 2010, BFLs net income was Rs. 6584 million. As of 2011, the company was the leading player in the Indian asset finance market. However, in 2009, BFL found itself struggling to meet customer demands due to its aging IT infrastructure application which needed immediate replacement. The IT infrastructure application was based on an in-house CRM (customer relationship management) application developed using MS Excel and MS Access. This in-house IT application lacked accuracy, consistency, and scalability as the business information was spread across multiple systems. Replacing it with an enhanced IT application infrastructure was a challenging

task as it involved identification of nearly 1.5 million eligible customers from a hugely populated database of around six million and then managing these contacts through an end-toend sales cycle. This fuelled the need for a single CRM system that could effectively manage back office as well as front office functions to markedly improve loan turnaround times for the processing of loans. A single platform CRM could also improve the firms ability to handle the companys promotional campaigns more efficiently and effectively. For instance, customers with a good payment record could be tracked and offered personal loans and other special benefits. Video 7.3.1 Cloud Computing
CLOUD COMPUTING AT BFL

With this in mind, Mody decided to follow the cloud computing approach to achieve endless scalability and to save on the capital spending on IT infrastructure. Under his strategic initiative, the cloud computing (Refer to Exhibit I for the explanation of Cloud Computing) program went live in April 2009 at BFL (Refer to Exhibit II for Cloud Computing Project at BFL). This cloud strategy enabled its customers to file their applications online and get faster approvals. Also it reduced the capital expenditure on IT infrastructure as the company did not have to acquire new hardware or software licenses. Cloud computing enabled BFL to outsource all the IT infrastructure capabilities; the company just needed an access
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point (internet) to access all the data and software services (SaaS, Software as a Service) on time. In this way, the company was able to get rid of all IT infrastructure related issues and effectively utilize the critical time of the IT team for strategizing and focusing on delivering what the business needed. Hence, the company decided to choose a cloud computing solution based on Salesforce.com2. BFL moved its consumables financing and cross sell divisions into Salesforce.com. Thus, the functionality of cloud-based CRM was extended to 300 employees across more than 50 cities in India. The company went on cloud on the Salesforce.com CRM system in April 2009. Consequently, with the help of the customization toolset, all major processes were made online. This comprised the integration of various services like the call center application dialer, credit bureau, and corporate mobile services. With the help of Salesforce.com, Bajaj Finance was able to roll out new products and processes across the distribution network. The total cost of the implementation of this new CRM was Rs3. 1.5 million, assumed to be less than an on premise application development. Most financial services companies move away from the cloud model computing due to the fear of downtime. However, BFL experienced much better uptime with the Salesforce.com platform than with the older in-house solution. The system reported only 2 outages of approximately 15 minute periods in 9 months of going live. According to Mody, it was impossible for the company to establish the kind of IT infrastructure facilities that

Salesforce.com provided. A major indication of the success of the service provided by Salesforce.com was in the level of loan activity during the holiday period. The in-house system was capable of processing only 1,500 loan applications per day. But after the deployment of the new system, this number went up to a whopping 8,500 Video 7.3.2 : Interview with a p p l i c a t i o n s p e r d a y. B y Devang Mody deploying the new CRM, BFL increased its business volume by a factor of more than 100%. Mody was excited about speaking about the robustness of the new system as one transaction was happening in approximately every four seconds. Moreover, an SMS facility for sending out text messages directly from Salesforce.com to dealers to communicate loan approvals had a commendable loan turnaround time of just four minutes. The laser-sharp approval timelines helped BFL to fulfill its ultimate goal in marketing the personal loan as a viable product alternative to credit cards. Mody, with the successful implementation of the new CRM, was on Cloud Nine. He thanked the Salesforce.com CRM that had helped the company to harness the power of the internet which in turn helped BFL to achieve its business objectives with a high level of customer satisfaction.

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QUESTIONS FOR DISCUSSION 1. Compare in-house application development with cloud computing. 2. Did Bajaj Finance benefit from the cloud computing strategy? Exhibit I

Exhibit II

CLOUD COMPUTING PROJECT SUMMARY

CLOUD COMPUTING

Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. It comprises three parts: software as a service (SaaS), platform as a service (PaaS), infrastructure as a service (IaaS), and Desktop as a Service (DaaS). Types of Cloud Computing - Public - Private - Hybrid/Combined - Community Source: Compiled by the author

Salesforce.com CRM deployed across Call Center, Sales, Credit, and Operation teams Solution Deployed Integration with Dialer, Dedupe system, Credit Bureau, SMS, and more recently GoogleMaps (to access customer locations from within Salesforce.com) Duration of the project Implementation cycle, from concept to solution build in just 3 months Project Cost Rs 1.5 million Increase in business volume at the counter by a factor of 166% General productivity of operations staff up by 46% 100% decision accuracy achieved within underwriting as validation rules ensure accurate data entry Cross sell conversion rates up 66% from Q1 to Q2

Business Benefits Achieved

Source: Varun Aggarwal, Cloud (Sales) Force Helps Bajaj Auto Finance Transform Business, Information Week, February 3, 2010
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S ECTION 4

Business Intelligence/Analytics
Business Analytics (BA) Video 7.4.1: What is refers to the skills, Business Intelligence? technologies, applications and practices for continuous iterative exploration and investigation of past business performance to gain insight and drive business planning. The field of business analytics has improved significantly over the past few years, providing business users with better insights, particularly from operational data stored in transactional systems.

Source: http://enterpriseblog.net

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The key consumer of these analytics is the business user, a person whose job is not directly related to analytics per se (e.g., a merchandiser, marketer, salesperson, etc), but who typically must use analytical tools to improve the results of a business process along one or more dimensions (e.g., profit, time to market, etc). Fortunately, data mining, analytic applications and business intelligence systems are now being better integrated with transactional systems, thereby creating a closed loop between operations and allowing data to be analyzed faster and the analysis results to be quickly reflected in business actions. Mined information is being deployed to a broader business audience, which is taking advantage of business analytics in everyday activities. Analytics are now regularly used in multiple areas, including sales, marketing, supply chain optimization and fraud detection. The analysis of customer data has provided success in reducing customer attrition, improving customer profitability, increasing the value of ecommerce purchases and increasing the response of direct mail and e-mail marketing campaigns. This has paved the way for new applications of business analytics to emerge. Of these new areas, some of the applications which are particularly promising include: supply chain visibility, price optimization, and workforce analysis.

Supply Chain Visibility: Organizations have automated significant portions of their supply chain. In the process, they have enabled the collection of significant data about inventory, the performance of suppliers, logistics, etc. N e w applications aid in analyzing this data to provide useful insights about t h e performance of suppliers and Source: http://www.ultimosoft.com/ partners, material expenditures, accuracy of sales forecasts to better control materials inventory, accuracy of production plans, the accuracy of plans for order delivery, etc. Price optimization: The wide adoption of CRM and Supply Chain Management software has allowed enterprises to fully interface/integrate their demand and supply chains. Based on this integration, enterprises are now able to capture up-to-the-minute data about the demand of a particular product as well as data of similar granularity about the corresponding datas supply. By analyzing these two data streams, corporations are able to optimize the price of a particular product along several dimensions so that the demand will meet the available
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supply. For example, the price of a product may be different through one channel, e.g., the Web, than through another, e.g., in the retail store. Such price optimizations allow corporations to maximize the profit margin of each item sold while reducing their inventory. Work Flow Analytics: Once corporations have been able to analyze data about their customers and their suppliers, it is only natural for them to begin analyzing data about their employees. A Source: http://www.recordsolutions.ca new generation of analytic applications allows enterprises to identify workforce trends, such as attrition rates and perform tasks such as compensation and benefits analyses. Companies whose cost or revenue model is dependent on hourly models, e.g., contact centers or systems integrators, are able to use this new generation of employee-centered analytics to optimize staffing levels and skills requirements in order to minimize the number of employees who could not be billed. Organizations use databases to track and process business transactions. Receiving materials from suppliers, processing customer orders and paying salaries to employees, etc., are the examples of business transaction. These form the life

blood of any organization in terms of their day to day operations. Managers need databases which can provide them the information that will help them to take better decisions and run their companies more efficiently. Large organizations will have large databases for every traditional function such as manufacturing, sales, accounting, etc. Special tools are required for analysis of huge volumes of data and accessing data which may reside in different systems. Data warehousing, data mining and even accessing internal databases through the web are typical of these capabilities. Data warehouse is a type of data base, which stores present and past data that are relevant to the managers and decision makers in the organization. Transaction processing systems in basic Source: functions such as sales, http://www.latestbusinessupdat productions are the es.com starting point along with web site transactions. The data warehouse consolidates and standardizes information from various databases of operational systems. This will enable the information that can be
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used across the entire enterprise, leading to analysis and decision-making. The data warehouse usually gives the access rights in terms of Read-only. Alteration rights will be denied for the users. It has the ability for standard query tools for adhoc information, analytical tools and graphical reporting facilities. Intranet portals cant act as a gateway for accessing the data warehouse information. Organizations usually construct enterprise wide data warehouses. These central warehouses serve the entire company. A data mart is a subset of data warehouse containing summarized or highly selective portion of the companys data. This is placed in a separate database made for a fixed set of users. A data mart can typically concentrate on a single subject area or line of business. For that reason it can be built rapidly and at a much lower cost compared to enterprise wide data warehouse. Data marts are hence a series of tools to analyze the data in a warehouse. These tools help us to see the new patterns, relationships and insights which are useful for making better decisions. Such tools are usually called business intelligence tools. The major BI tools include software for database query/reporting, tools for multidimensional analysis and data mining. An individual's ability to combine the knowledge already learnt along with new information and ultimately change behaviors in such a way that he/she succeeds in this attempt or adapt to a new situation is generally termed

"Human intelligence". Video 7.4.2: A Day in the Similarly, Business life of a Business Intelligence enables Intelligence Engineer companies to accumulate information; develop deeper knowledge about customers, suppliers, competition and their internal operational processes; and change decision making behavior leading to better achievement of goals and higher profits. Decisions with better responses with data and patterns should lead to improved organizational performance. Online Analytical Processing (OLAP) Multi-dimensional data analysis is supported by OLAP. User managers can view the same data using a wide variety of dimensions. Each attribute of information (product/service type, price, cost, area or month of sales) represents a different dimension. The manager can know the actual sales of one product in a particular month, how that compares with previous month and same month of previous year and how it compares with sales forecast. Even ad-hoc queries can be answered online by OLAP. There could also be a provision to store historical data for many years.

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Data Mining Traditional queries of database can provide answers to simple questions such as "what was the total sales of 5 HP pumps in March 2012 ? " OLAP can compare sales of the same product with the budget and area for the previous 3 years. Data Mining is more discovery-driven because it provides unique insights into the business data. Source: http://techpubs.sgi.com Such a facility is not available with OLAP, as it does not allow discovery of hidden pattern and relationships in huge databases and hence draw inferences from them to predict their behavior in the future. There will be patterns and rules which will help guide decision-making and forecast the effect of such decisions. There is a wide variety of information generated through data mining which are discussed as follows: Associations - These are occurrences related to a single event. For example, a survey of supermarket purchases might reveal that when bread is purchased, eggs are purchased 50% of the time, but when there is a promotion regarding nutritional

value of eggs, eggs are bought 75% of the time. Such information helps managers take better decisions. Effectiveness of promotion plan is hence better understood. Sequence - Here the happenings are connected over a time period. For example, if the possession of house is taken from a builder, a new TV will be purchased within one month 50% of the time and a microwave oven will be purchased within 2 months 40% of the time. Classification - Pattern recognition is achieved through this. This can identify the group to which a product belongs. This is achieved by classifying products and inferring a set of rules. This helps in retaining customers who are likely to defect to another product or service provider. Unique promotions can be designed to make such customers stay with the same product/services. Clustering - Here, there are no clearly defined groups. New groupings can be discovered through data mining tools. The above application attempts future predictions. But forecasting makes use of a series of data values to forecast the remaining values. For example, sales demand forecasting. In addition to such high level analyses of patterns and trends these tools can also drill down whenever more detailed information is needed. Governments
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and scientific institutions make good use of such tools. While structured data stored in large databases are analyzed with the help of business intelligence tools, text mining tools are used for handling unstructured data. The World Wide Web is a rich source of such data. Video 7.4.3 : Business Analytics Turning Data into Insight

Video 7.4.4 : What can Business Analytics Do For You? Learn how it helps you here...

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Case Study : Assessing Customer Purchase Behavior at India Bazaar Retail Ltd.

Ramesh Yadav (Ramesh), Vice President (Marketing) of Samagri, stood outside the newly opened Samagri store on May 20, 2011, at Ameerpet in Hyderabad. He gazed with pleasure at the store. It certainly looked swanky! This was the first store of India Bazaar Retail Ltd. to be opened in

Hyderabad. The company strongly believed that customer satisfaction toward their products would be the key factor in increasing their market share. With the intention of maintaining its focus on the customer, the company undertook a pilot study to assess which of its products tended to be

This case study was written by Surajit Ghosh Dastidar and reviewed by R Muthukumar, IBS Hyderabad. It is intended to be used as the basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation. The case was compiled from published sources. 2012, IBSCDC. No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever without the permission of the copyright owner.

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purchased together and to initiate new campaign strategies to attract the customers. ABOUT THE COMPANY India Bazaar Retail Ltd. was the retail arm of India Bazaar Group, a US$ 10 billion corporation. The company ventured into the food and grocery retail sector in 2010. Subsequently, India Bazaar Retail Ltd. expanded its presence across the country under the brand name Samagri. Samagri was a one-stop shopping destination for the entire family. Ramesh joined as VP of Marketing in September 2010 and was involved with the in-store branding, marketing, and promotion of the chain. As part of corporate strategy, he sought to focus on improving customer service and customer satisfaction, which he knew were not always consistent and would only increase day to day. To meet customer expectations and keep the customers completely satisfied, the company had to put in continuous efforts to attract customer regularly. The media advertisements of the chain focused on everyday low prices (Har din sasta Samagri). In addition to low price, the marketing effort was focused on private labels where the margin of the store was substantially higher. Private labels were also priced 30%-40% lower than branded products. At the same time, the company had to keep track of customer purchase behavior so as to develop appropriate marketing strategies.

ABOUT PILOT STUDY TO ASSESS CUSTOMER SATISFACTION In this context, Ramesh wanted to examine the companys customer base and understand which of its products tended to be purchased together. He decided to conduct a pilot study to assess this. Ramesh made the dataset in the form of a summarized table from the purchase bills of a few customers taken randomly (Refer to Exhibit 1). Ramesh wanted to perform an analysis from this dataset and then take a decision on the promotional campaigns to be launched in the near future. He made Vibhav Kumar (Vibhav), his subordinate, responsible for performing the analysis and commenting on the result. Vibhav wondered how this analysis would help Ramesh make an informed decision.

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Exhibit I
BILL NO. SKU BILL NO. SKU

54580 54580 54580 54580 54580 54580 12350 12350 12350 12350 12350 12350 12350 12350 12350 12350 12350 12350

CADBURYS GEMS 12.3 G RICE KURNOOL SONAMASURI 25 KG NEW RICE KURNOOL SONAMASURI 25 KG KURKURE HYDERABADI STYLE 45 GMS. UNIBIC JAMZ BISCUIT 150 GMS. UNIBIC CHOCONUT COOKIES 135 GMS. PONDS MAGIC TALC 400 GMS. VASELINE BODY LOTION TOTAL MOISTURE 300 ML PRIYA GINGER&GARLIC PASTE 200 GMS. DIVYA DEEPAM GINGELLY OIL 1 LTR. VIJAYA SUNFLOWER REFINED OIL 1 LTR REFIL VEGAN WET DOSA BATTER 850 GMS AKROOT 100 G BADAM DAL 50 G BESAN 500 G DALCHIN 10 G GREEN ELAICHI 20 G JEERA 50 G

12350 12350 12350 12350 12350 12350 12350 12350 12350 12350 12350 30539 30539 31089 3001 5316 5213 5213

KAJU SPLIT 100 G KISMISS 2 QUALITY 50 G MUSTARD BIG 100 G PALLI 200 G PUTNA DAL 500 G SUGAR 2 KG FAIR & LOVELY MU VIT TOT FAIR CREAM 80 GMS BKS HEALTH MAGAZINE COTTON MATOVEL SMALL SUNFEAST PASTA TREAT MASALA 83 GMS BISLERI WATER 500 ML VSR NEW SONA MASOORI RICE 25 KG GROUNDNUT FRESH BAJAJ ELECTRIC RICE COOKER RCX5 SUGAR 5 KG SUGAR 5 KG CADBURYS PERK CHOCOLATE 13.5 GMS PARACHUTE COCONUT OIL BOTTLE 500 ML

Note: Each row of the dataset contains a customer product combination.

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Social Networking and Social Media

Source: http://communicatetoday.org

Birds of same feathers flock together. Likewise, groups of people sharing common interest will have a high desire to interact among themselves. Social networking sites such as Facebook offer many tools to enable such meaningful interactions. Social networking sites such as LinkedIn.com offer services to business or engineering professionals. There are many niche sites working exclusively to serve journalists, doctors, artists, etc. Invariably these sites emphasize on collaboration features. Members of these sites will easily be able to set up profiles, post blogs, tag documents of personal interest and actively participate in online forums to communicate with other co-workers about their interests and common goals. Corporations can also use such social networking sites for sharing business ideas, plans and enable collaboration among many jobs in the organization, which require a high level of interaction.

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These online communities formed by social networking sites can tremendously increase the number of one's business or social contacts by making connections through individual members. These sites link individuals through their mutual business or personal connections, facilitating them to mine their friends (and in turn, their friends' friends) for business sales leads, job searching tips, or new contacts. For instance, Facebook focuses on extending their friendships, while LinkedIn.com concentrates on job placements networking. The members of social networking sites spend a lot of time surfing web pages, checking out other member users and exchanging messages. This leads them to reveal a lot of information about themselves. Organizations can harvest this information to c r e a t e a f u l l y Source: http://caprium.com focused and targeted promotions which will be much better than ordinary text and display ads usually found on the World Wide Web. Companies can use such sites to interact with potential customers. Successful sites are in a position to attract potential visitors and are so "sticky" to ultimately become effective marketing tools. This type of

e-commerce experience is very attractive to many businesses and there are many such social shopping sites.

Video 7.6.1: The World of Social Media 2011

Collective action and social interaction online with rich exchange of multimedia information and evolution of aggregate knowledge, as a result of new social technologies like blogs, wikis, social networking sites, is called social computing. One example of social computing is tagging. Tagging is developing a tag for a particular set of information which is organized by an Video 7.6.2: Social individual but acts like Networking in Plain English a identification of information which the other individuals are looking for on the Web, provided the tags are shared with other individuals. Social computing shifts computing to the edges of the network and empowers individual users with relatively low
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technological sophistication in using the Web to manifest their creativity, engage in social interaction, contribute their expertise, share content, collectively build new tools, Video 7.6.3: Antenzen: Coworkers Network

Video 7.6.5: Super Cafe: Super Social Network

disseminate information and propaganda, and assimilate collective bargaining power.

Video 7.6.4: Social Media Tools Review

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R EVIEW 7.1
Question 1 of 4
Which of the following is an example of a cloud computing application?

A. B. C. D.

Skype Salesforce.com Twitter Facebook Applications

Check Answer

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Case Study: Indian Taxi Driver and Social Media

Video 7.7.1: Indian Taxi Driver Devesh Mishra (Devesh), a 12th grader and taxi driver from Varanasi, India, was doing just fine in his business till 2007. However, the global economic recession1 of 2008 and 2009 led to a steep fall in the number of tourists visiting India and resulted in a terrible slowdown in the Indian tourism industry. Deveshs business, which depended to a large extent on the performance of the tourism i n d u s t r y, w a s s e v e r e l y affected. Surviving the slowdown was the biggest concern before Devesh.

This case study was written by Kartikeya P Bolar and reviewed by Saradhi Kumar Gonela, IBS Hyderabad. It is intended to be used as the basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation. The case was compiled from published sources. 2012, IBSCDC. No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever without the permission of the copyright owner.

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A CUSTOMERS ADVICE With his worries uppermost in his mind, Devesh couldnt help talking about them to one of his customers from Singapore. The customer then suggested that Devesh could try to create visibility for his business among new customers whom he had never met. Devesh was startled by the customers suggestion. The customer suggested that he put up a video on the internet explaining his business. Devesh was worried that making such a video would prove to be too expensive. Besides, wouldnt there be the expense of posting such an advertisement on the internet? The customer then suggested that he post his video on YouTube, which hosted videos without any charge. He explained that through YouTube, Devesh could reach potential customers for free. Devesh asked him if his video would not get lost in the huge number of videos posted on YouTube. The customer explained that if the video was given an appropriate category and proper labels or tags or keywords, it would definitely be viewed by interested people. Also, there was a chance that they would forward his video to friends as well, which would further enhance his visibility. Mesmerized by the idea, Devesh began thinking day and night about the content for the video. When he shared the idea with others, one of his regular clients from Switzerland decided to help him out with the development of the video. Devesh was really grateful for his education which enabled him to converse in English with the clients a rare accomplishment among Indian taxi drivers.

THE VIDEO WONDER His Swiss client also helped him with the script of the video. The video showing Devesh explaining his business was posted on the web on January 19, 2008 (Refer to Exhibit I for the You Tube appearance of the video). Within a short time, the video had received more than 30,000 views and visitors spread positive reviews and comments about it. Viewership further multiplied as most viewers posted the links on their blogs, social networking sites like Facebook and Linkedin and bookmarked the webpage link on many social bookmarking sites. Due to the huge response, the video managed to appear on the first page of the popular search engine Google. With its popularity, the video boosted Deveshs business. Along with the development of the video, Devesh also created an email address (?) for himself. He received a number of emails from tourists, especially foreigners, booking his cab services. Devesh not only survived the recession but actually increased his business manifold. Devesh wanted his co-drivers also to understand the value of social media and to use the media to increase their visibility. Having succeeded in increasing his business, Devesh embarked on the idea of developing videos for struggling smalltime businessmen in Varanasi. QUESTIONS FOR DISCUSSION 1. Investigate in detail the potential business applications of the various social media discussed in the case. 2. If you were a management consultant, what would you advise Devesh to do to become even more successful in his business?
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This document is authorized for internal use only at IBS campuses- Batch of 2012-2014 - Semester I. No part of this publication may be reproduced, stored in a retrieved system, used in a spreadsheet, or transmitted in any form or by any means - electronic, mechanical, photocopying or otherwise - without prior permission in writing from IBS Hyderabad.