DECISION SUPPORT AND ARTIFICIAL INTELLIGENCE

1
CHAPTER 5

• DECISION SUPPORT AND ARTIFICIAL INTELLIGENCE
• Brainpower for Your Business

2
The Survival of Your Business Depends on
Effective Decision Making
Introduction
5-2

• IT can supplement human decision making
• IT can replace some types of human decision making

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YOUR FOCUS IN THIS CHAPTER
Introduction
5-3

• Types of Decisions
• The Decision-Making Process
• IT Brainpower
• How IT Brainpower Supports the Decision-Making
  Process

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TYPES OF DECISIONS YOU FACE
Types of Decisions
5-4

• STRUCTURED DECISIONS - those with a set of steps
  that guarantee the correct solution.
• NONSTRUCTURED DECISIONS - those with no rules or
  criteria that guarantee a good solution.

See Figure 5.2, page 175
5
TYPES OF DECISIONS YOU FACE
Types of Decisions
5-5

• RECURRING DECISIONS - those you make repeatedly,
  often periodically.
• NONRECURRING DECISIONS - those you make
  infrequently, perhaps only once.

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PHASES OF THE DECISION-MAKING PROCESS
The Decision-Making Process
5-6

• 1. INTELLIGENCE -Find what to fix
• 2. DESIGN - Find fixes
• 3. CHOICE - Pick a fix
• 4. IMPLEMENTATION - Apply the fix

See Figure 5.3, page 177
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TYPES OF IT BRAINPOWER
IT Brainpower
5-7

• Decision Support Systems (DSS)
• Group Decision Support Systems (GDSS)
• Geographic Information Systems (GIS)
• Artificial Intelligence Systems (AI)
• Expert Systems
• Neural Networks
• Genetic Algorithms
• Intelligent Agents

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A DECISION SUPPORT SYSTEM (DSS)
DSS
5-8
is a highly flexible and interactive IT system
that is designed to support decision making when
the problem is not structured. A DSS assists you
in making a decision, as opposed to making the
decision for you. See Figure 5.4, page 177
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A DSS Can Help With Analysis Tasks Like
DSS
5-9

• Deciding where to spend advertising dollars
• Analyzing sales trend information
• Analyzing drug interactions
• Developing airline schedules
• Pricing products

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A DSS Has Three Components
DSS
5-10

• DATA MANAGEMENT - to allow you to store and
  access information.
• MODEL MANAGEMENT - to allow you to store and
  access models.
• USER INTERFACE MANAGEMENT - to allow you to
  easily manipulate information and models.

See Figure 5.5, page 178
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STEPS IN DEVELOPING A DSS
DSS
5-11

• 1.INTELLIGENCE
• Do you need a DSS?
• What should it do?
• What does it need?
• 2.DESIGN
• What can you buy/build?
• 3.CHOICE
• What will you buy/build?
• 4.IMPLEMENTATION
• Build or install DSS
• Learn, test, and evaluate the DSS

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A GROUP DECISION SUPPORT SYSTEM (GDSS)
GDSS
5-12
is a type of decision support system that
facilitates the formulation of and solution to
problems by a team. A GDSS helps a team to
generate ideas, identify strengths and
weaknesses, choose an alternative, and reach a
consensus.
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A GDSS Can Help With Team Tasks Like
GDSS
5-13

• Determining new product design
• Evaluating the impact of new competition
• Formulating a strategic plan

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THE STEPS OF GROUP DECISION MAKING
GDSS
5-14

• 1.Brainstorming - generate ideas
• 2.Issue Categorization and Analysis - classify
  ideas
• 3.Ranking and Voting - prioritize alternatives,
  reach consensus

See Figure 5.9, page 184
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PEOPLE IN A GDSS
GDSS
5-15

• Team People united by a common goal
• GDSS facilitator has two roles
• Nontechnical run the meeting
• Technical operate IT components

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IT TOOLS IN A GDSS
GDSS
5-16

• Groupware - software than enables team work
• DSS Capabilities - software that enables team
  decision making
• Telecommunications - hardware and software that
  connect computers

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MEETINGS WHEN AND WHERE YOU WANT TO BE
GDSS
5-17

• Same-Time (Synchronous) Meetings
• In the same room
• In the same city
• On the same planet
• Different-Time (Asynchronous) Meetings
• In the same city
• On the same planet

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A GEOGRAPHIC INFORMATION SYSTEM (GIS)
GDSS
5-18
is a decision support system designed
specifically to work with spatial information. A
GIS represents information thematically in
overlapping layers, each of which shows a
different aspect of the total picture.
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A GIS Can Help With Spatial Analysis Tasks Like
GDSS
5-19

• Identifying the best site to locate a branch
  office
• Targeting pockets of potential customers
• Repositioning promotions and advertising

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ARTIFICIAL INTELLIGENCE (AI)
AI
5-20
is the science of making machines imitate human
thinking and behavior.
AI helps machines perform tasks that require
complex and varying sets of steps such as
retrieving debris from the ocean floor.
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TYPES OF AI USED IN BUSINESS
AI
5-21

• EXPERT SYSTEMS
• NEURAL NETWORKS
• GENETIC ALGORITHMS
• INTELLIGENT AGENTS

70 of the top 500 companies use AI as part of
decision support.
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AN EXPERT SYSTEM
Expert System
5-22
is an artificial intelligence system that applies
reasoning capabilities to reach a conclusion. An
expert system captures expertise from a human
expert and applies it to a problem.
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An Expert System Can Perform Diagnostic and
Prescriptive Tasks Like
Expert System
5-23

• Auditing and tax planning
• Diagnosing illnesses
• Managing forest resources

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COMPONENTS OF AN EXPERT SYSTEM
Expert System
5-24

• Information
• People
• IT Components

How do these components work together? See the
traffic light example on page 195.
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INFORMATION TYPES IN AN EXPERT SYSTEM
Expert System
5-25

• Domain Expertise - the set of steps that will
  solve the problem.
• Why? Information - the information that
  explains the expert systems actions.
• Problem Facts - specific information concerning
  the current problem.

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PEOPLE IN AN EXPERT SYSTEM
Expert System
5-26

• Domain Expert - the person who knows how to solve
  the problem without the aid of IT.
• Knowledge Engineer - the person who builds the
  expert system.
• Knowledge Worker - the person who uses the expert
  system to solve a problem.

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IT COMPONENTS IN AN EXPERT SYSTEM
Expert System
5-27

• KNOWLEDGE BASE - stores the domain expertise.
• INFERENCE ENGINE - processes the domain expertise
  and your problem facts to reach a conclusion.

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IT COMPONENTS IN AN EXPERT SYSTEM
Expert System
5-28

• KNOWLEDGE ACQUISITION - used by the knowledge
  engineer to build the expert system.
• USER INTERFACE - used to run a consultation.
• EXPLANATION MODULE - stores the Why?
  information.

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TO ACQUIRE AN EXPERT SYSTEM
Expert System
5-29

• Buy an off-the-shelf expert system
• Use an expert system shell
• Develop an expert system from scratch

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WHAT EXPERT SYSTEMS CAN DO
Expert System
5-30

• Provide consistency in decision making
• Provide new information
• Reduce costs

• Handle massive amounts of information
• Reduce errors
• Improve customer service

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WHAT EXPERT SYSTEMS CANT DO
Expert System
5-31

• Handle all types of domain expertise
• Solve problems other than those for which they
  are designed
• Apply common sense or judgment to a problem

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A NEURAL NETWORK
Neural Network
5-32
is an artificial intelligence system which is
capable of learning because its patterned after
the human brain.
A neural network simulates the human ability to
classify things based on the experience of seeing
many examples.
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A Neural Network Can Perform Pattern Recognition
Tasks Like
Neural Network
5-33

• Distinguishing different chemical compounds
• Detecting anomalies in human tissue that may
  signify disease
• Reading handwriting
• Detecting fraud in credit card use

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A GENETIC ALGORITHM
Genetic Algorithm
5-34
is an artificial intelligence system that mimics
the evolutionary, survival-of-the-fittest
processes to generate increasingly better
solutions to a problem.
Genetic algorithms produce several generations of
solutions, choosing the best of the current set
for each new generation.
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A Genetic Algorithm Can Generate Lots of
Solutions As In
Genetic Algorithm
5-35

• Generating human faces based on a few known
  features.
• Generating solutions to routing problems.
• Generating stock portfolios.

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THE CONCEPTS OF EVOLUTION IN GENETIC ALGORITHMS
Genetic Algorithm
5-36

• SELECTION - or survival of the fittest. The key
  is to give preference to better outcomes.
• CROSSOVER - combining portions of good outcomes
  in the hope of creating an even better outcome.
• MUTATION - randomly trying combinations and
  evaluating the success (or failure) of the
  outcome.

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AN INTELLIGENT AGENT
Intelligent Agent
5-37
is an artificial intelligence system that can
move around your computer or network performing
repetitive tasks independently, adapting itself
to your preferences. An intelligent agent is
like a travel agent in that it performs tasks
that you stipulate.
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An Intelligent Agent Can Perform Tasks Like
Intelligent Agent
5-38

• Acting as a personal electronic assistant to
  collect, send, and prioritize electronic
  information such as e-mail.
• Finding and retrieving information from a
  database.
• Finding and retrieving information across
  networks.

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How Does an Intelligent Agent Do That?
Intelligent Agent
5-39
An intelligent agent (usually) combines the
capabilities of two or more of the most modern
software technologies such as expert systems,
neural networks, genetic algorithms,
object-oriented programming, and so on.
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AI
5-40
Starting Information Experts know-how Acceptabl
e patterns Set of possible solutions Your
preferences
AI System Expert Systems Neural
Networks Genetic Algorithms Intelligent Agents
Problem Type Diagnostic or prescriptive Identifi
cation, classification, prediction Optimal
solution Specific and repetitive tasks
Based On Strategies of experts The human
brain Biological evolution One or more AI
techniques
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AI SYSTEMS CAN BE COMBINED WITH DECISION SUPPORT
SYSTEMS
IT Brainpower
5-41

• DSSs can incorporate one or more expert systems
  creating an intelligent DSS, a DSS/ES, or a
  knowledge-based DSS.
• Neural networks can be combined with GISs to
  apply pattern recognition capabilities to spatial
  information.

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A HYBRID INTELLIGENT SYSTEM
IT Brainpower
5-42
is an IT system which combines two or more
artificial intelligence systems.

• Neural networks and expert systems can be
  combined to create a trainable expert system.
• Neural networks and genetic algorithms can be
  combined to train neural networks.

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TO SUMMARIZE
5-43

• IT can help you be an effective decision maker by
  assisting you in decision-making tasks with
• Decision support systems (DSS)
• Group decision support systems (GDSS)
• Geographic information systems (GIS)

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TO SUMMARIZE
5-44

• IT can help you be an effective decision maker by
  performing tasks for you with AI using
• Expert systems
• Neural networks
• Genetic algorithms
• Intelligent agents

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TO SUMMARIZE
5-45

• To benefit from the decision support capabilities
  of IT you must know
• The nature of the problem
• What type of decision support tools can help
• How to apply the decision support tools to the
  problem.