The translation software also performs administrative, audit, and control func- tions. For example, the software inserts identification and control information in front of (header) and after (trailer):
Each transaction set, such as one purchase order.
Each functional group (e.g., a group of purchase orders, a group of receiving ad- vices, and so forth) so that several groups may be sent in one transmission.
All components comprising one transmission.
In EDI lingo, the data sets and the headers/trailers are called “envelopes.” In ad- dition to assembling and disassembling the EDI envelopes, the translation software may log incoming and outgoing messages and route the messages from and to the proper application.
138 Part II Technology for Business Processes and Information Systems
Briefly define e-business and e-commerce. How are they related?
Explain the relationship between the periodic mode and batch processing.
List and describe the four basic subprocesses completed in processing business event data using batch processing.
Explain how the use of online transaction entry (OLTE) can increase efficiency when using batch processing.
Explain the relationship between online real-time (OLRT) and immediate mode processing.
List and describe the three basic subprocesses completed in processing business event data using online real-time processing.
How does the use of online transaction processing (OLTP) improve the timeliness of online real-time processing?
a. Explain how bar code readers work.
b. Explain how optical character recognition works and how it differs from bar code technology.
c. Explain how scanners are used to capture data.
How is digital image processing used to support the keying in of data?
Explain the difference between wide area networks and local area networks.
Explain the advantages of using electronic document management rather than tra- ditional paper-based document systems.
Explain how electronic data interchange is used to link two companies’ business processes together.
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Explain how value-added networks (VANs) are used to simplify electronic data in- terchange between two or more companies.
Compare EDI and XML technologies.
How does the Internet simplify the world of e-business?
What role do network providers play in the e-commerce environment?
What types of assurances are provided by Internet assurance services?
Why is EDI moving to the Internet?
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The business environment is increasingly demanding the use of online real-time systems for more up-to-date information. Identify one business application, and the environment in which it would be used, as an example of why immediate mode processing is so critical. Be prepared to explain your answer to the class.
Take as an example your favorite fast food chain restaurant. How do you think this restaurant might use online transaction entry to improve its business event data processing activities? Explain.
We noted during the chapter discussion that banks were one of the earliest adopters of online transaction processing systems. Discuss why OLTP would be so desirable for use in ATM systems.
How does your university use the Internet to improve communication between students, faculty, and staff?
What would you perceive to be the advantages and disadvantages of conducting business on the Internet? Be prepared to explain your answer.
Why has the Internet caused such an explosion in e-business when electronic data interchange has been available for decades?
Consider again the example of Lands’ End and its use of Internet commerce as dis- cussed in the text. In a business where customers want to know fairly definitive de- livery dates, what are the risks of using periodic processing on orders? Does the processing of orders several times each hour negate the disadvantages of periodic processing?
How can e-mail be adapted to a more structured form to aid in capturing business event data?
DISCUSSION QUESTIONS
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140 Part II Technology for Business Processes and Information Systems
Find a merchandising business on the Internet (other than the Lands’ End example used in this chapter). Explore its Web page and how the order processing system works.
a. Is there any information provided on how secure the Web page is? What level of comfort do you feel with its security? Explain.
b. Does the business provide information regarding delivery time/stock-outs on purchases?
c. What methods of payment does it accept?
d. Analyze the design of the Web page in terms of usability and completeness of information content. Write a brief critique of your company’s page.
Identify a business venture that you believe could be successful solely using the In- ternet. Explain how you would design your Web page, how you would capture business event data, and the mode of processing you would use. Provide a report detailing support for your design decisions. (Your professor will tell you how long the report should be.)
Develop a research paper on the growing use of the Internet to support electronic data interchange (EDI) between companies. Your paper should consider how com- panies set up communications over the Internet to maintain the same security and standardization that are achieved using value-added networks for non-Internet EDI (Your professor will tell you how long the paper should be.)
Explain how electronic document management is or could be used in your Infor- mation Systems class to eliminate all paper flow between the students and profes- sor. Include in your explanation what technologies would be necessary to facilitate your plan. (Your professor will tell you how long the paper should be.)
Write a research paper on the issues involved in developing an XML-based alterna- tive to EDI for use in a specific industry of your choosing. Consult the Internet to see if a standard has been proposed for that industry, and if so, evaluate its use.
PROBLEMS
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There is a popular saying that the amount of information in the world doubles every ten years. That’s a lot of information! How can the average manager or decision maker expect to keep up with the flood of data that is so easily ac- cessible? How can this decision maker determine what data is useful, which is believable, and how much of it is even relevant to a current problem or op- portunity? Information technology turns out to be both the enabler of this flood of data and a tool for sorting through and analyzing it all. When used creatively, information technology can tease out trends and opportunities from data collected for entirely different purposes.
Take, for example, Amazon.com. Amazon.com is known for being the most successful “dot-com” company doing business solely over the Internet. It is heralded for its competitive pricing, efficient transactions, and speedy delivery.
What it is less well known for is its ability to collect, analyze, and reuse mar- keting data. Amazon.com keeps a database of every sale it makes to a cus- tomer. The company knows when and what you order, and will send you an e-mail coupon to prod you to order again if it has been a while since you last ordered anything. The coupon may be for an entirely different product line. If you bought a computer book, you might get a coupon to order some com- puter equipment. Buy Harry Potter, and get a discount on toys or video games.
When you look at a book on the site, you will also see a list of other books bought by customers who bought the book you are considering, which may entice you to expand your purchase. Amazon.com had been publishing a list of books bought by customers at different large employers but stopped when companies objected on the grounds of privacy. (Of course, this change doesn’t mean Amazon.com can’t follow trends internally to help its marketing staff.) Amazon.com can also analyze pricing, occasionally experimenting with varying purchase prices to different customers to increase revenues on its cur- rent volume of sales.
How does Amazon.com accomplish all of this? It relies on high-quality data in its database and uses business intelligence tools to analyze the data in sup- port of business decisions. This chapter introduces several types of business intelligence tools to give you an idea of how a company combines the data that it collects with publicly available data to support decision making through- out the layers of management.
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