BUSINESS DRIVEN TECHNOLOGY

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BUSINESS DRIVEN TECHNOLOGY UNIT 3 Enhancing
Business Decisions OPENING CASE Revving Up Sales
at Harley-Davidson
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Unit Three

• The chapters in this unit include
• Chapter Nine Enabling the Organization
  Decision Making
• Chapter Ten Extending the Organization Supply
  Chain Management
• Chapter Eleven Building a Customer-centric
  Organization Customer Relationship Management
• Chapter Twelve Integrating the Organization
  from End to End Enterprise Resource Planning

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Unit Three

• Decision-enabling, problem-solving, and
  opportunity-seizing systems

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BUSINESS DRIVEN TECHNOLOGY Chapter Nine
Enabling the Organization Decision Making
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LEARNING OUTCOMES

• 9.1 Define the four systems organizations use to
  make decisions and gain competitive advantages
• 9.2 Describe the three quantitative models
  typically used by decision support systems
• 9.3 Describe the relationship between digital
  dashboards and executive information systems

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LEARNING OUTCOMES

• 9.4 List and describe three types of artificial
  intelligence systems
• 9.5 Describe three types of data-mining analysis
  capabilities

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CHAPTER NINE OVERVIEW

• The amount of information people must understand
  to make decisions, solve problems, and find
  opportunities is growing exponentially

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CHAPTER NINE OVERVIEW

• Model a simplified representation or
  abstraction of reality
• The following systems use models to support
  decision making, problem solving, and opportunity
  capturing
• Decision support systems (DSS)
• Executive information systems (EIS)
• Artificial intelligence (AI)
• Data mining

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DECISION SUPPORT SYSTEMS
Start
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DECISION SUPPORT SYSTEMS

• Decision support system (DSS) models
  information to support managers and business
  professionals during the decision-making process
• Three quantitative models typically used by DSSs
• Sensitivity analysis the study of the impact
  that changes in one (or more) parts of the model
  have on other parts of the model
• What-if analysis checks the impact of a change
  in an assumption on the proposed solution
• Goal-seeking analysis finds the inputs
  necessary to achieve a goal such as a desired
  level of output

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DECISION SUPPORT SYSTEMS

• What-if Analysis

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DECISION SUPPORT SYSTEMS

• Goal-seeking analysis

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EXECUTIVE INFORMATION SYSTEMS

• Executive information system (EIS) a
  specialized DSS that supports senior level
  executives within the organization
• Most EISs offering the following capabilities
• Consolidation involves the aggregation of
  information and features simple roll-ups to
  complex groupings of interrelated information
• Drill-down enables users to get details, and
  details of details, of information
• Slice-and-dice looks at information from
  different perspectives

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EXECUTIVE INFORMATION SYSTEMS

• Digital dashboard integrates information from
  multiple components and present it in a unified
  display

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ARTIFICAL INTELLIGENCE (AI)

• Intelligent systems various commercial
  applications of artificial intelligence
• Artificial intelligence (AI) simulates human
  intelligence such as the ability to reason and
  learn and typically can
• Learn or understand from experience
• Make sense of ambiguous or contradictory
  information
• Use reasoning to solve problems and make decisions

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ARTIFICAL INTELLIGENCE (AI)

• The ultimate goal of AI is the ability to build a
  system that can mimic human intelligence

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ARTIFICAL INTELLIGENCE (AI)

• The three most common categories of AI include
• Expert systems computerized advisory programs
  that imitate the reasoning processes of experts
  in solving difficult problems
• Neural Networks attempts to emulate the way the
  human brain works
• Intelligent agents special-purposed
  knowledge-based information system that
  accomplishes specific tasks on behalf of its users

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DATA MINING

• Data-mining software typically includes many
  forms of AI such as neural networks and expert
  systems

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DATA MINING

• Common forms of data-mining analysis capabilities
  include
• Cluster analysis
• Association detection
• Statistical analysis

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Cluster Analysis

• Cluster analysis a technique used to divide an
  information set into mutually exclusive groups
  such that the members of each group are as close
  together as possible to one another and the
  different groups are as far apart as possible
• CRM systems depend on cluster analysis to segment
  customer information and identify behavioral
  traits

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Association Detection

• Association detection reveals the degree to
  which variables are related and the nature and
  frequency of these relationships in the
  information
• Market basket analysis analyzes such items as
  Web sites and checkout scanner information to
  detect customers buying behavior and predict
  future behavior by identifying affinities among
  customers choices of products and services

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Statistical Analysis

• Statistical analysis performs such functions as
  information correlations, distributions,
  calculations, and variance analysis
• Forecasts predictions made on the basis of
  time-series information
• Time-series information time-stamped
  information collected at a particular frequency

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OPENING CASE STUDY QUESTIONSRevving Up Sales at
Harley-Davidson

• Explain how Talon helps Harley-Davidson employees
  improve their decision-making capabilities and
  highlights potential business opportunities
• Assess the business impact Harley-Davidson could
  gain by using executive information systems
• Determine how Harley-Davidson can benefit from
  using artificial intelligence to support its
  business operations

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CHAPTER NINE CASEFinding the Best Buy

• Best Buy has annual revenues of over 1 billion
  and employs over 10,000 people
• The company uses data-mining to
• Simplify information
• Consolidate information
• Enhance infrastructure operations
• Reduce complexity
• Increase performance
• Streamline business processes

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CHAPTER NINE CASE QUESTIONS

• Summarize why decision making has improved at
  Best Buy with the implementation of a data
  warehouse
• Determine what types of information might be
  presented to a Best Buy marketing executive
  through a digital dashboard
• Evaluate how Best Buy could use the information
  in the data warehouse for sales forecasting