Enterprise System

What are some benefits and challenges of enterprise systems? Why would an organization want to build one?

Benefits and Challenges of Enterprise Systems

Enterprise systems promise to integrate the diverse business processes of a firm into a single integrated information architecture but they present major challenges.

One benefit is efficiency through electronic collaboration among many employees. One challenge is the expense of purchasing, installing, and maintaining the hardware and software that enables the enterprise system.

Enterprise systems integrate the firm's key business processes in sales, production, finance, logistics, and human resources into a single software system so that information can flow throughout the organization, improving coordination, efficiency, and decision making.

These systems help create a more uniform organization in which everyone uses similar processes and information, and measures their work in terms of organization-wide performance standards.

The coordination of the firm's key business processes allows the firm to respond more rapidly to customer demands.

Benefits of Enterprise Systems

Enterprise systems promise to greatly change four dimensions of business: firm structure, integrated information architecture but they present major challenges.

Firm Structure and Organization: One Organization

Companies can use enterprise systems to support organizational structures that were not previously possible or to create a more disciplined organizational culture.

Management: Firm wide Knowledge-based Management Process

In addition to automating many essential business transactions, such as taking orders, paying suppliers, or changing employee benefit status, enterprise systems can also improve management reporting and decision making.

Technology: Unified Platform

Enterprise systems promise to provide firms with a single, unified, and all-encompassing information system technology platform and environment....