MANAGEMENT REPORT Business value proposition

Information and Technology Management

BUSM4409

Valentina Duran 3448562

MANAGEMENT REPORT 1

Table of Contents

Table of Contents .................................................................................................................................... 0

Figures .................................................................................................................................................... 2

Executive summary ................................................................................................................................. 2

1.0 Introduction ....................................................................................................................................... 3

2.0 Business Intelligence System ............................................................................................................ 4

2.1 Stage 1. Targets and priorities- Set up a collection Network ........................................................ 4

2.2 Stage 2. Data evaluation method................................................................................................... 4

2.3 Stage 3. BI storage System ........................................................................................................... 5

2.4 Stage 4. Analysis of IB information .............................................................................................. 5

2.5 Stage 5. Dissemination method ..................................................................................................... 5

2.6 Advantages .................................................................................................................................... 6

3.0 Customer Relationship Management ................................................................................................ 7

3.1 Top Management championship practices .................................................................................... 7

3.2 Employee IT skills ........................................................................................................................ 7

3.3 CRM knowledge ........................................................................................................................... 8

3.4 Advantages .................................................................................................................................... 8

4.0 Enterprise resource planning (ERP) ................................................................................................ 10

4.1 Project planning .......................................................................................................................... 10

4.2 Information requirements ............................................................................................................ 10

4.3 Architectural devise .................................................................................................................... 10

4.4 Staged approach .......................................................................................................................... 10

4.5 Data conversion .......................................................................................................................... 11

4.6 Advantages .................................................................................................................................. 11

5.0 Knowledge Management ............................................................................................................ 12

5.1 Project information and knowledge ............................................................................................ 12

5.2 Knowledge acquisition ................................................................................................................ 12

5.3 Best practice knowledge data base .............................................................................................. 12

5.4 Knowledge based decision support ............................................................................................. 13

5.5 Multivariate design ..................................................................................................................... 13

5.6 Advantages .................................................................................................................................. 14

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Conclusions ........................................................................................................................................... 15

Recommendations ................................................................................................................................. 16

References ............................................................................................................................................. 17

Figures

Figure 1: BI model .................................................................................................................................. 5

Figure 2: CRM performance model ........................................................................................................ 8

Figure 3: KM system model.................................................................................................................. 13

Executive summary

This report provides a business value proposition to implement information technology

systems for the Coffee construction Australian firm. It presents and examines four different

information systems to enhance and increase business opportunities. These are related to

business intelligence system (BIS), Customer relationship management (CRM), enterprise

resource planning (ERP) and Knowledge Management (KM). These technological and

innovative models are fundamental tools for project managers to improve the construction

process and to create successful projects.

It shows different stages to implement information systems and better understand benefits for

the company. It gives an insight about strategic ways to manage complex projects and build

competitive advantages in the construction industry. It shows that information systems are

crucial tools to create competitive approaches to manage projects in construction industries.

This reports also includes recommendations and conclusions.

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1.0 Introduction

Coffee construction Australia is a private firm that focuses on creating civil engineering and

construction projects. The company has obtained big opportunities in construction

management contracts, expanding business possibilities, increasing client relationships and

improve reputation. It has professional personnel capable of achieving projects objectives.

However, Coffee construction Australia has not established effective technology process as

part of the organisation system. This situation represents a potential risk to the business

performance, future opportunities and status.

Considering the magnitude and complexity of civil engineering project that the company is

delivering is vital to implement strategic information technology systems. The new era of

construction requires innovative systems to maintain long-term business values. Project

managers should apply these systems to produce effective decision making, execute quality

project life cycle and obtain planned results. This report aims to present the benefits that

technological systems such as business intelligence system (BIS), Customer relationship

management (CRM), enterprise resource planning (ERP) and Knowledge Management (KM)

can represent to the coffee construction Australian firm and shows successful ways of

implementation.

1.1 Purpose report

The purpose of this report is to demonstrate the advantages of using Information technology

systems into the Coffee construction Australia Company for business values. It is important

to enhance the construction management process, develop innovative business strategies,

establish effective use of resources, increase and maintain client satisfaction.

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The following information systems models may be used to integrate and connect information-

data, to produce intelligent outcomes for project management decisions and generate new

approaches for internal construction process.

2.0 Business Intelligence System

According to Gilad & Gilad (2001) the main purpose of this system in to collect, converter

and evaluate row amounts of information into manageable, reliable and useful sets of data to

enhance project’s decision making. The key factor of implementing a Business Intelligence

System (BIS) in the Coffee construction Australian firm, is to optimise project decision

making by creating corporate and business strategies, developing marketing approaches,

increasing customer/client satisfaction and develop economic processes of construction. BIS

is an intelligent system that allows project managers to structure, goals and needs in more

efficient ways. (Popovič et al., 2012).

The following process explains BIS implementation in five stages. It focuses on transforming

information into quality data stores and providing high levels of strategic report (Gilad &

Gilad, 2001).

2.1 Stage 1. Targets and priorities- Set up a collection Network

This stage creates cleaver sources of information from technical and informal data to very

sophisticate used of materials. It allows to generate more appropriate and advantageous

network connections between different areas of the project such as marketing and sales

department, finance, human resource department, IT, environment department and so forth.

IB system can gather effective sources of information and create solid channels of

communication to develop internal personnel networks.

2.2 Stage 2. Data evaluation method

The information is evaluated and qualify throughout mechanisms of control. Only significant

and useful information from the collection network, is assessed and showed to the user. The

system uses two elements to evaluate accurate information which are called sources and data

reliability. Both determinate small collections of relevant information in order to present

quantitative pieces of materials.

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2.3 Stage 3. BI storage System

Users can access to different kind of information required through the system in a very short

time. It may have generic storage systems that can vary from simple to sophisticated and

more complex data. The information is reduced by looking at internal collection and

resources.

2.4 Stage 4. Analysis of IB information

In this stage the information is analysed and interpreted by using three methods: arrange, and

interpretation of relevant information and finally, it creates a hypothesis to determinate

possible risks and outcomes of the project.

2.5 Stage 5. Dissemination method

It condenses all the information obtain from previous stages and creates automatic

management reports. This report contains specific information about all areas or departments

in which the project works. Additionally, it can generate three sorts of reports which are

critical intelligence reports, situation reports and background reports. Those have variations

in terms of scope, purpose and areas of interest.

Figure 1: BI model

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2.6 Advantages

Azma and Mostafapour (2012) highlight some advantages that this system can bring to

construction firms.

-Increase profitability by making intelligent decisions as well as predict market expansions

and opportunities to invest in new projects.

-Distinguish loyal customer’s responses, customer segmentation and multiply levels of

customer satisfaction by increasing in-depth knowledge in areas such as market, competitors

and needs.

-capacity to detect potential risks and opportunities as well as improve the quality of internal

processes with transparency.

-Support project management, strategic decisions and project’s cost saving by increasing

productivity and enhancing performance.

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3.0 Customer Relationship Management

Customer Relationship Management (CRM) technology focuses on integrating strategically

marketing processes and customer relationship to improve project’s performance, satisfaction

and service quality. It connects a series of marketing activities such as marketing research,

order with outcomes related to profitability, retention and assets (Saini, Grewal and Johnson,

2009). According to Saeed et al., (2010) CRM system emphases on modifying one-to-one

relationship between customers and organisations. Its function is to retain, enhance and

attract over time, prosperous and long term customer relationship through information

technology.

Saini, Grewal & Johnson (2009) identify three essential elements to ensure CRM system

successful performance.

3.1 Top Management championship practices

To optimise CRM system performance, seniors and managers should articulate plans for the

correct use of the system. Goals and norms should be specified for all the members of the

team to obtain effective benefits in marketing process and improving procedures. Project

managers must create strategic methods to improve and enhance better understanding of the

system. Successful outcomes of CRM relay upon top managers support and initiatives for all

the people involved in the project.

3.2 Employee IT skills

Employees should have IT skills as a fundamental precondition to use CRM system. They

should also have the capacity to analyse and design systems and being involved with

emerging technologies. Research suggests that favourable customer relationships, strong

marketing conditions and collaboration might be greatly influenced by employee IT skills

into the company.

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3.3 CRM knowledge

Saini, Grewal & Johnson (2009) point out four knowledge, perspectives that are fundamental

to CRM system performance. Firstly, relationship management, which incorporates building

customer relationship through planning and managing relevant information about existent or

potential future customer. Secondly, collaboration Management which embraces quality

management knowledge about process, logistics and delivery systems. Thirdly, market

environment that involves increasing knowledge about competitor’s conditions, low,

regulations and technological developments. Finally, Customer profitability which includes

knowledge about retaining a long term relationship and recognise high potential

customer/client relationship.

Figure 2: CRM performance model

3.4 Advantages

Roh, Ahn & Han (2005) mention five benefits that CRM systems provide to projects.

-Effective and use of information customer/client service by understanding, analysing,

organising and evaluating marketing behaviours, customer necessities and market

environments.

-System Support which includes response time, data accuracy, quality system flexibility and

documentation.

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-Efficient utilisation of time, cost and function in a productive operating system process. An

efficient internal process can be develop by using this approach.

-Stakeholder satisfaction which reflects stakeholder’s control of the system. It is a

stakeholder-driven system that represents strong patterns to measure project’s success.

-Increase of Profitability outcomes by generating revenues, increasing assets and enhance

project’s process performance. Customer/client relationship Management should increase net

benefit value for the future of projects.

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4.0 Enterprise resource planning (ERP)

Enterprise resource planning (ERP) system is an integrated software that interconnects

processes information about the company’s business. These are related to construction,

human resources, financial management, manufacturing and procurement. The main purpose

of ERP is to provide quick, accurate and reliable real-time information to everyone in the

company. ERP system is used at the beginning of the project to support and prepare project’s

developments, facilities and management control. (Chia and Ling, 2003)

Glen G (2012) shows how to implement ERP successfully in a project. Using five important

factors as showing below.

4.1 Project planning

In this stage all essential components and elemental process of the project are assessing

which means include tasks such as set up goals and aims of the project, establish initial

project requirements, organise areas where project teams are going to work and estimate

project costs.

4.2 Information requirements

This stage basically refers to fundamental business requirements identification by classifying

specific and detail data information. It is crucial to any project because it allows planning,

organising and structure project scope, deliverables, risks, human resources. It also helps to

avoid mistakes and save time.

4.3 Architectural devise

It includes analyse, evaluate and select the best IT system to use in the organisation. This

stage is fundamental because focus on looking for the best application technology to be

connected in all areas of business functions. It should be integrated into one basic and

organised structure.

4.4 Staged approach

It creates a pilot sequence of tasks with its respectively time schedule along with a list of

project short term goals. The result is a structure and manageable list of clear and specific

tasks.

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4.5 Data conversion

It involves a relational database management system (RDBMS) to storage amounts of data

and manage internal and external business information. Its objective is to provide a wide

understanding of the business approaches and implementation within the company.

4.6 Advantages

Chia and Ling (2003) present some advantages of using ERP system:

-Improves and integrate a flexible working atmosphere for everyone in the project.

-Provides different levels of information, from simple to complex management level.

-Allows the standardisation process to understand business changes and the global economy.

-Provides technical modification across different areas of the company.

-Enhance efficient management practices and planning process in all the life cycle of the

project.

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5.0 Knowledge Management

According to Kale and Karaman (2012) Knowledge Management (KM) system is a

fundamental source to compete, sustain and maintain business advantages in the construction

industry. This subject is particularly complicated to manage because of its intangible nature.

Although, it presents a big challenge approach to construction companies, it is one of the

most important areas in the management process because it comprises vast amounts of

information. It also allows project managers to analyse information from the success or

failure of previous projects, strategies implemented or lessons learnt.

Kanapeckiene et al., 2010 propose an integrate KM system for construction projects during

the life cycle as showing below.

5.1 Project information and knowledge

It combines macro, meso and micro levels of variables of a project which includes economic,

cultural, governmental, political, legal and normative, social and marketing aspects. These

useful information allows project managers to integrate huge amounts of data into a very

simple and strategic system.

5.2 Knowledge acquisition

There are fundamental elements that impact the construction industry directly or indirectly. In

terms of social, cultural, political, legal, technological, natural environments and use of

energy in construction. These aspects are gathering in this stage to better project classification

and understand projects consequences or risks. It considers explicit and tacit knowledge

along with stakeholder’s requirements and needs.

5.3 Best practice knowledge data base

This stage used two models to determinate organisation, management and economical aspects

of a specific project. Model for collective criteria and establish priorities and a model for

identifying project utility patterns. These models are focused on finding construction project

possibilities and identifying most important considerations.

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5.4 Knowledge based decision support

It examines essential information for project management, such as existing knowledge,

decision support systems, methods and strategies used before in projects and intelligent

information. It has a database management, model-base management system and command-

line interpreter. It provides great insights of construction scenarios to be better analysed and

selected by project managers.

5.5 Multivariate design

It analyses the multiple variations between significance and priority aspects to implement in a

project. Qualitative and quantitative information is processed to measure project’s values and

alternatives. Its purpose is to select, identify and analyse the best business project by

evaluating macro level information, internal and external aspects of a project and possibilities

of success.

Figure 3: KM system model

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5.6 Advantages

The advantages that KM system can bring to construction companies are numerous.

Competitive advantage is the fundamental point to start (Kale and Karaman 2012)

-Create strategical approaches to compete in the construction environment by incorporating

useful data into critical thinking.

-Enhance the process of organisation and communication between project stakeholders, team

members, sponsor and vendors.

-Reduce significantly cost operations and processes by anticipating and evaluating risks.

-Improve project scheduling, constructed facilities and procedures for construction

operations.

-Introduce innovative methods of structure construction services, marketing perspectives and

project management procedures.

-Increase customer/client satisfaction by collecting and using reliable information into the

business strategy and stakeholder needs.

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Conclusions

Four information systems have been presented in this report. Firstly, enterprise resource

planning (ERP), which is a software that integrates business areas across the system.

Secondly, business intelligence system (BIS) which analyses and evaluates information from

different sources, providing valuable material to help project managers make decisions.

Thirdly, knowledge management (KM) which captures contextual data, experiences

collected, values and perspectives that are relevant to an organisational asset. Finally,

customer/client relationship management (CRM) system which provides relevant information

to manage internal-external risks and uncertainties for the project success. Each system

should benefit the Coffee construction Australian firm by supporting the construction

management process, increase quality business strategies, and improve the use of resources.

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Recommendations

To enhance company’s business value, efficiency and business expansion, the Coffee

construction Australian firm should implement ERP, CRM, KM and BI systems to reduce

costs and saving time in the construction process and improve customer satisfaction. It should

enhance information quality, strategies, efficient management outcomes and profitability.

Project managers should use these systems as a source of efficient and effective decision

making tool.

Project Managers should focus on identifying the benefits and implications from the project

objective perspective when implementing these systems. It is recommended to use these

systems as core tools for a project planning stage in areas such as scheduling, costs, risks and

resources. Information systems should support managers to concentrate efforts on goals,

priorities and positioning the company into higher levels of performance.

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References

Azma, F. and Mostafapour, M, 2012. Business intelligence as a key strategy for development

organizations. Procedia Technology, 1, pp.102-106.

Chia, S. and Ling, F, 2003. Implementation of Enterprise Resource Planning in Firms Operating in the

Construction Industry. Architectural Science Review, 46(3), pp.323-331.

Gilad, B. and Gilad, T, 2001. A systems approach to business intelligence. Business Horizons, 28(5),

pp.65-70.

Glen, G 2012, Enterprise Resources Planning 100 Success secrets- 100 Most Asked Questions: The

missing ERP software, Systems, Applications, and implementation Guide.

Kale, S. and Karaman, E, 2012. A diagnostic model for assessing the knowledge management

practices of construction firms. KSCE Journal of Civil Engineering, 16(4), pp.526-537.

Kanapeckiene, L. Kaklauskas, A. Zavadskas, E. and Seniut, M. (2010). Integrated knowledge

management model and system for construction projects. Engineering Applications of Artificial

Intelligence, 23(7), pp.1200-1215.

Saini, A. Grewal, R. and Johnson, J, 2009. Putting market-facing technology to work: Organizational

drivers of CRM performance. Marketing Letters, 21(4), pp.365-383.

Popovič, A. Hackney, R. Coelho, P. and Jaklič, J, 2012. Towards business intelligence systems

success: Effects of maturity and culture on analytical decision making. Decision Support Systems,

54(1), pp.729-739.

Roh, T. Ahn, C. and Han, I, 2005. The priority factor model for customer relationship management

system success. Expert Systems with Applications, 28(4), pp.641-654.

Saeed, K. Grover, V. Kettinger, W. and Guha, S, 2011. The successful implementation of customer

relationship management (CRM) system projects. SIGMIS Database, 42(2), p.9.