Information and Decision Support Systems

1
Information and Decision Support Systems

• Chapter 10

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Information is an organizations core asset.
Transaction processing systems capture a large
amount of data. Management information systems
and decision support systems process and refine
that data to provide vital information to
decision makers and problem solvers. As
organizations reengineer business processes,
information systems designed for decision-making
are no longer used solely by managers. To
empower employees to make their own decisions and
solve their own problems, organizations must
provide employees at all levels of the enterprise
with timely information provided by these systems.
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Chapter 10 discusses information systems used for
decision-making and problem solving in business,
including management information systems and
decision support systems. After studying this
chapter, you should be able to address the
objectives on the next 3 slides.
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Learning Objectives

• List describe the stages of a problem-solving
  process.
• Define management information system (MIS) and
  clearly distinguish an MIS from a TPS.
• Discuss information systems in the functional
  areas of businesses.

5
Management information systems are designed to
provide correct timely information about
business operations to the right person.
Management information systems are explicitly
designed to provide information for
decision-making and problem-solving, while
transaction processing systems are not.
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Learning Objectives

• Describe important characteristics of decision
  support systems (DSS)
• Describe the basic components of a decision
  support system.

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Like management information systems, decision
support systems are designed to provide
information to decision makers. However,
decision support systems are designed to be used
when problems are more unstructured.
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Learning Objectives

• State the goal of a group decision support system
  (GDSS)
• Identify the characteristics of a group decision
  support system that distinguish it from a DSS
• Identify basic uses of an executive support
  system list its characteristics

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Group decision support systems and executive
support systems extend the general approach of a
DSS to specific situations, namely group and
executive decision making and problem solving.
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Decision Making and Problem Solving
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Before looking at the information systems
designed to help decision makers and problem
solvers, we should understand the decision making
and problem solving processes.
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Figure 10.1
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As shown in Figure 10.1, decision-making is part
of problem-solving. Decision-making encompasses
the first three steps of the problem-solving
process the intelligence, design and choice
stages. In the intelligence stage, potential
problems or opportunities are identified.
Alternative solutions are developed in the design
stage. And a specific solution or course of
action is selected in the choice stage.
Problem-solving continues with the implementation
stage, where the solution is put into action.
The final stage of problem-solving is monitoring,
where the solution or course of action that was
implemented is evaluated to see if it
accomplished its goal.
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This process model doesnt only apply to complex
problems generally people follow it in everyday
decisions. For example, suppose you need to fly
out of town. During the intelligence phase, you
identify all the problems or issues involved.
Two problems you identify are transportation to
and from the airport in your hometown and your
destination. In the design stage, you think of
alternative ways to solve the problem. Consider
transportation to your home airport. You could
drive your own car and park it in long term
parking. You could ask your neighbor to drive
you and pick you up. You could take a cab. Or
you could take the airport shuttle.
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In order to choose an option, you evaluate and
each alternative in terms of cost, convenience,
and availability. Assume your neighbor offers to
drive you and you chose that option. The
implementation phase starts when you set up the
times with him and continues when he drives you
to and from the airport. Monitoring might start
while you are waiting for him to pick you up if
hes a little late, you look at your watch and
start thinking about whether or not youll make
the flight. When you check in for your flight
out of town, youre done monitoring the drive to
your home airport.
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Programmed versus Nonprogrammed Decisions

• Programmed decisions
• Structured situations with well defined
  relationships
• Quantifiable
• Management information system

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When selecting an alternative in the choice
stage, various factors affect the decision. We
saw in the airport transportation example that
resource constraints, such as time, money, or
availability, are factors. Another factor is
whether the decision can be programmed.
Programmed decisions are made by following rules,
procedures or quantitative methods that can be
described in advance and regularly used, since
the situations are recurring and well-structured.
Management information systems are designed to
provide information to address programmed
decisions.
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Many simple programmed decisions can be
completely automated for example, inventory
control systems can be programmed with reorder
points and automatically trigger an order for
more merchandise when the reorder point is
reached.
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Programmed versus Nonprogrammed Decisions

• Nonprogrammed decisions
• Ill-structured situations with vague or changing
  relationships between variables
• Not easily quantifiable in advance
• Decision support systems

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Nonprogrammed decisions involve unusual,
continually changing, or novel circumstances and
poorly structured situations. It is usually
difficult or impossible to quantify nonprogrammed
decisions or to develop rules or procedures to
follow to solve the problem. An example of a
nonprogrammable or poorly structured situation
would be deciding where to locate a new regional
airport. This is not a decision that is made
often, and each time such a decision is made, it
involves a different locale, different economic
conditions, different population concerns, and so
on.
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Decision support systems are designed to help
decision makers with nonprogrammed or
ill-structured problems.
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Problem Solving Approaches

• Optimization find the best solution
• Satisficing find a good solution
• Heuristics use rules of thumb

23
Computerized decision support systems can usually
be used for both optimization and satisficing
modeling. An optimization model finds the best
solution in relation to the constraints,
assumptions, and goals it was given. For
example, an optimization model can find the
optimal labor cost to produce a particular
product and meet a specific level of profit,
subject to the cost of raw materials and
machinery. Profit level is a goal and costs are
a constraint in the model.
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A satisficing model finds a good, but not
necessarily the best, solution. Satisficing is
used when optimization is too difficult, costly,
or complex. Satisficing looks only at solutions
that are likely to produce a good solution and
can thus be done more easily and quickly than
optimization, which involves an exhaustive search
of all possible solutions.
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Heuristics, or rules of thumb, are often used in
decision making. Heuristics are generally
accepted guidelines, or guidelines developed
through experience, that usually find a good
solution. For example, you might follow a
heuristic of taking an umbrella if it is cloudy,
windy, and humid when you leave the house. Your
experience has shown you that generally this
results in having an umbrella when it rains.
However, this isnt an optimal solution since
sometimes you carry an umbrella unnecessarily and
sometimes it rains on days when you dont have
an umbrella. But the cost of finding an optimal
solution is far too great in terms of time and
money.
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Figure 10.2
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Spreadsheet programs often can perform
optimization. Figure 10.2 shows Solver, an
optimizing routine in Excel.
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An Overview of Management Information Systems
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Management information systems provides
decision-makers information and feedback on daily
operations. Additionally, management information
systems can be used strategically, often
incorporating Web technology.
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Figure 10.3
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Figure 10.3 shows the relationship of management
information systems to information sources and
other organizational systems. Transaction
processing systems capture and update databases
that provide the largest source of input to
management information systems. Input data is
provided by additional internal and external
databases. External data sources include those
available over the Internet. Management
information systems filter and process the data
to output reports that help users plan, control,
organize, and monitor operations more efficiently
and effectively.
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Management information systems also create
summary or application databases containing data
that has been processed or summarized into a form
useful to managers. Application databases can be
queried and analyzed by employees or used as
input to decision support systems, expert
systems, and executive support systems.
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Figure 10.4
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Most management information systems produce
predetermined reports that is, reports whose
content has been designed and programmed in
advance. These include scheduled reports, key
indicator reports, demand reports, exception
reports and drilldown reports. Scheduled reports
are produced at regular intervals, such as
hourly, daily, weekly or monthly. For example, a
sales manager might get a weekly report
summarizing sales by region, store, or
salesperson. This allows the manager to monitor
sales and follow-up on locations or people that
seem to be slipping.
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Key indicator reports summarize the prior days
critical activities to allow the user to take
quick action to fix a potential problem. For
instance, a report received each morning
summarizing sales figures from each store would
allow a sales manager to immediately follow up
with stores that show slow sales. Demand reports
are reports produced to give information at a
managers request, rather than on a particular
schedule. For example, on a Wednesday, the sales
manager may request weekly sales to date for each
store.
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Although these reports can be produced on demand,
the requested information must have been
identified at an earlier time and processed and
stored in the application database. For example,
if a company has never identified a stores rate
of sales growth as necessary information before,
a manager cannot suddenly request it and except
to receive it from the management information
system. Exception reports are automatically
produced to show a deviation from normal or from
a plan. For example, each quarter the sales
manager might receive an exception report listing
those stores that failed to meet their sales
target.
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Figure 10.4 contd
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Drill-down reports start with highly summarized
data and allow a user to request increasing
levels of detail. For example, the sales manager
may initially see a table listing monthly sales
by region. If he wants more detail, he can use
the mouse to click on a particular region, say
the southeast, and would see a table summarizing
sales in the southeast region by store. If he
sees that store A has lower sales than any other,
he could click on it and see sales for that store
by department. He could click on a particular
department to see sales by employee or by item.
This helps users trace problems or superior
performance to the root.
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Figure 10.4 shows a drilldown report starting
with earning summarized by quarter, drilling down
to sales by product category.
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Table 10.1
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Table 10.1 lists some guidelines for developing
reports that can be useful. Ensuring MIS
reports provide only useful and timely
information and are designed for usability is
important.
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Characteristics of an MIS

• Fixed format, standard reports
• Hard-copy or soft-copy reports
• Uses internal data
• User-developed reports
• Users must request formal reports from IS
  department

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As mentioned earlier, all reports from an MIS
have been predetermined that is, management
information systems do not generally produce ad
hoc reports, or unique reports done only once.
Most recipients get the same report, although
they may use it for different purposes. Output
from an MIS may be printed, or hard-copy, or
viewed on a screen, called soft-copy. Most
output from an MIS is hard copy. The primary
source of input data for an MIS is internal data
stored in internal databases, generally data
collected and maintained by a transaction
processing system.
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Sometimes data from external databases is added,
such as general economic data or data about
competitors actions. Since an MIS create an
application database, end users can request their
own simple reports to access the information
stored in it. However, if many users develop the
same report, it may be more efficient for the IS
department to produce it. More complex reports
are generally requested from the IS department
and developed by specialists.
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Functional Aspects of the MIS
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Each management information system is an
integrated collection of subsystems, often
organized along functional lines of an
organization.
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Figure 10.5
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Functional areas typically include accounting,
finance, marketing, personnel, operations,
research and development, and legal. Management
information systems organized by functional area
produce specialized reports for each area.
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Figure 10.6
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A financial MIS provides information to people
who need to make decisions involving the
companys finances. Figure 10.6 shows an overview
of a financial information system. A financial
MIS integrates financial and operational
information from multiple internal and external
sources and makes financial data available on a
timely basis and allows funds to be monitored and
controlled over time. Typically, a financial MIS
provides easy access to financial data to both
financial and nonfinancial users increasingly
through intranets and extranets.
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Most financial information systems allow
financial data to be analyzed in a variety of
ways, such as by time, customer or product line,
and allow past and present financial activity to
be analyzed and monitored. A financial MIS helps
a company manage and use funds effectively for
internal uses, such as inventory or supplies,
and for external investments. Financial
information systems include profit/loss and cost
systems, which organize revenue and cost data.
Revenue and expense data collected by the
transaction processing system are a primary input
to the financial MIS.
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Figure 10.7
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Manufacturing management information systems
assist in the control and monitoring of
materials, products and services through the
organization. The purpose of a manufacturing MIS
is to help a firm produce products or services
that meet customer needs at the lowest possible
cost. A manufacturing MIS includes subsystems
that track raw material inventory and finished
inventory, assist on the shop floor or in design
and engineering, and help control production,
costs and quality.
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For example, computer-added design, or CAD,
programs help in product design and
configuration. CAD programs can be used to
develop three-dimensional product models.
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Figure 10.8
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Master production scheduling is part of many
manufacturing information systems. A master
production schedule plans both short-term and
long-range production facilities scheduling. Some
scheduling programs can be used to forecast
demand for products or services and schedules
facilities to best meet the demand. Most programs
also allow a production manager to perform
sensitivity analysis to see changes on the
production schedule that would result from demand
or cost changes.
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Manufacturing MIS

• Inventory management (MRP, JIT)
• Process control
• Computer-assisted manufacturing (CAM)
• Computer integrated manufacturing
• Flexible manufacturing system
• Quality control

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Inventory control programs are one component of a
manufacturing MIS that relies on the production
schedule. Inventory control programs can
forecast future production, automatically reorder
items when a certain threshold is met, determine
manufacturing costs, and develop resource
requirements plans from the production
schedule. Manufacturing Requirements Planning
(MRP) programs help coordinate thousands of
inventory items when demand for one item depends
on demand for another.
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MRP systems determine when finished products are
needed, then work backward to determine deadlines
and resources needed to complete the final
product on schedule. When high inventory levels
are kept, a companys money is tied up in unused
inventory. This means higher costs for the
company. A Just-in-time (JIT) inventory approach
ensures inventory and materials are delivered
only when they are needed. This maintains
inventories at their lowest possible level, but
insures materials are on-hand in time for
production.
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Although JIT is beneficial, it also makes a
business vulnerable to supply chain disruptions
whether internal or external. For example, if a
machine breaks down that makes a component
another unit needs to assemble the product,
assembly may need to stop due to lack on
components. Technologies have been developed to
control and streamline the manufacturing process.
Computers can directly control manufacturing
equipment using computer-assisted manufacturing
software. Computer-integrated manufacturing
software connects all aspects of production
together, including order processing, product
design, manufacturing, quality control, and
shipping.
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For example, after an engineer designs a product
using CAD software, MRP systems can use
information from the design as input to plan and
order materials. Production scheduling systems
can use the design specifications as an input
into the scheduling process. And computer-added
manufacturing systems can use the design
specifications as input for setup. This greatly
improves manufacturing efficiency. A flexible
manufacturing system allows a facility to quickly
and efficiently change from making one product to
making another, often using robotics and other
automation. Generally the changeover is
computer-controlled.
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Finally, quality control has become paramount for
manufacturing firms. Control charts or sample
testing is used to monitor product quality.
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Figure 10.9
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Developing control charts and sampling plans can
be difficult. Quality control software handles
the complexity of this task. The information
provided by quality control programs can help
locate equipment products or design better
products.
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Figure 10.10
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A marketing MIS includes subsystems that support
the management of product development,
distribution, pricing, promotion, and sales
forecasting in order to increase sales, reduce
marketing costs, and plan new products.
Subsystems include marketing research, product
development, promotion and advertising, and
product pricing. Marketing research involves
conducting a formal study of the market and
customer preferences. Marketing research can
identify potential customers, as well as features
and qualities, such as price, function or color,
customers want in a particular product or
service.
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Data is collected by various means, such as
surveys and interviews. The Internet provides a
convenient, low-cost tool to gather market
research from formal on-line surveys to chat
rooms.
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Figure 10.11
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Product pricing is one of the complex functions
that software can help with. Product pricing
starts with an analysis of the demand curve for a
product, which shows the relationship between
price and sales. Generally, a company wants to
find a price that will maximize revenues.
Software makes it very easy to see relationships
between price and sales, enabling quick
adaptation of pricing strategies to meet market
needs, and thus, increase profitability.
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Figure 10.12
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Sales analysis is also used to identify which
products, personnel, and customers contribute to
profits and which do not. Figure 10.12 shows
examples of reports that can be produced to help
make sound marketing decisions. This first
report shows which products are doing well, the
second allows unproductive sales people to be
identified, and the last show who the best
customers are.
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Figure 10.13
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A human resource, or personnel, MIS addresses
activities related to employees and potential
employees. Some of the subsystems of a personnel
MIS handle workforce analysis, hiring, training,
and job management. Figure 10.13 shows some of
the inputs and outputs of a personnel MIS. A
fundamental function of a human resource MIS is
to determine the right number and kind of
employees needed to do specific jobs.
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For companies involved with large projects, this
can be a large and complex task, involving
forecasting and project management software to
determine when particular types of employees are
needed and in what quantity in order to meet
specific deadlines. Complex scheduling of people
and jobs can be streamlined by using
software. Personnel applications may also be used
to schedule interviews or recruiting trips or to
administer skill tests to job candidates. Often
interview and test results can be analyzed and
reported on by the software. Many companies now
use the Internet to initially screen job
candidates.
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Self-paced training in specific or general
skills, or in company policies and procedures,
can be done by computer-based tutorials or
distance learning. Skills and proficiency tests
can be administered by computer. Wage and salary
administration is an important MIS subsystem.
Wages, salaries and benefits can be determined,
administered, and monitored using human resource
information systems.
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Other Management Information Systems

• Accounting management information systems
• Geographic information systems (GIS)

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There are many other kinds of management
information systems used in organizations,
including accounting MISs and geographic
information systems. While an organizations
transaction processing system captures accounting
data, the accounting MIS provides summary
information on various aspects of the accounting
system, such as accounts payable or accounts
receivable. A geographic information system can
collect, store, manipulate and display geographic
information. In a geographic information system,
data are displayed according to their locations.
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Has a sales clerk ever asked you for your zip
code as you pay for a product? When a retail
store or restaurant chain is considering opening
a new location, they may use a geographic
information system to determine where their
potential customers are located. By displaying a
map, with zip codes color coded to show the
number of customers traveling to the current
store location, a business can place the new
store close to the area where most of them live.
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An Overview of Decision Support Systems
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Decisions support systems are people, procedures,
software, databases, and devices that are used in
problem-specific decision-making and
problem-solving. Decision support systems are
particularly useful when dealing with
semi-structured, poorly structured, or
unstructured situations. Although decision
support systems are used most often at higher
levels of management, all employees may use them
to assist in even programmable decisions.
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Characteristics of Decision Support Systems

• Handle lots of data from various sources
• Report presentation flexibility
• Text and graphics capabilities
• Support drill down analysis

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Not all decision support systems, or DSSs, are
alike some are very small in scope, with only a
few of the following attributes others are
comprehensive and powerful. A DSS can analyze
information stored in a data warehouse or a
database that is distributed across multiple
locations. External sources of data, such as
those available via the Internet,can also be
incorporated into a decision model. Users can see
their output in an appropriate format whether
that is a chart, image, table or even map on a
printout or on the screen. In some systems,
managers can also drilldown to more detailed data.
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Characteristics of a DSS

• Complex analysis, statistics, and forecasting
• Optimization, satisficing, heuristics
• Simulation
• What-if analysis
• Goal-seeking analysis

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Many of a DSSs analytical programs are
standalone programs, integrated by the DSS.
Decision support systems often support all types
of decision-making approaches to allow the user
great flexibility. For example, even simple
spreadsheets support what-if analysis, which
allows the user to make changes to input
variables to see the result on outcomes. For
example, if you can increase production either by
adding a new machine or upgrading different
combinations of existing machines, you can change
the appropriate costs and capacities on a
spreadsheet and see which increases output the
most and/or costs the least.
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Simulation allows a user to model a problem by
duplicating features of a real system. This
generally involves some uncertainty or
probability. For instance, perhaps we can
increase production by either adding a new
machine or by adding additional employees to set
up and reconfigure existing machines between
production runs. A simulation would model the
complex interaction of all these variables, based
on estimates of how long it takes one person to
reconfigure a machine and how additional people
change the time, production time of one machine,
and so on.
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Figure 10.14
87
Goal-seeking analysis is the process of
determining the inputs, or variable values or
quantities, needed to get a specific result. Say
you want to increase production by exactly 500
units. Using goal-seeking analysis, you could
find the number of additional workers you would
need to add to the assembly line.
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Capabilities of a DSS

• Support all problem-solving phases
• Support different decision frequencies
• Support different problem structures
• Support various decision-making levels

89
Although a specific DSS might only support one or
a few phases, decision support systems can
support decision makers in all the phases of the
problem-solving process that is, in the
intelligence, design, choice, implementation, and
monitoring stages. As weve seen in this chapter,
decisions can range from one-of-a kind to
recurring. An ad hoc DSS is useful for one-of-a
kind or less structured decisions, while an
institutional DSS handles situations that happen
on an ongoing basis. Institutional DSSs are
refined over time.
90
For instance, deciding where to locate a regional
airport is likely a one of a kind decision,
whereas investment decisions are recurring.
Thus, a DSS can support decisions ranging from
unstructured to structured.
91
Figure 10.15
92
Because of their flexibility, decision support
systems are useful at all levels of the
organization.
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Table 10.2
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Table 10.2 shows examples of decision support
systems, showing the range of support they can
provide.
95
Table 10.3
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Decision support systems differ from management
information systems in many ways. Weve seen
that an MIS designed to support structured
decisions, whereas a DSS can handle structured
and less structured situations. Users are more
actively involved in the creation and use of
decision support systems than management
information systems. Table 10.3 describe these
and other differences.
97
Components of a DSS
98
Decision support systems are composed of several
interrelated parts.
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Figure 10.16
100
A database and model base are at the heart of a
DSS, but many also allow external database and
Internet access. Additionally, a DSS has an easy
to use interface, called a dialogue manager. For
example, the dialog manager for a spreadsheet
programs such as Excel, is an interactive
worksheet with easy to use menus.
101
The Model Base

• Financial models
• Cash flow
• Internal rate of return
• Statistical analysis models
• Averages, standard deviations
• Correlations
• Regression analysis

102
Decision makers use a DSS to model problems or
situations in various ways. For instance,
financial models can show the relationship among
variable in investment analysis. The model base
gives DSS users access to a variety of built-in
models they can use, so users dont need to write
lengthy programs to create their own models.
Often, model management software coordinates the
use of models in a DSS. For example, consider the
examples of financial models listed on the slide.

103
Rather than a decision-maker trying to remember
how to calculate the internal rate of return for
an investment and then figure out how to enter
commands for the DSS to perform the calculations,
it is far more efficient to use the built in
internal rate of return model. Although some
businesses create complex financial models unique
to their situation, DSS software contains
powerful financial models.
104
Statistical models perform many tasks, including
summary statistics, trends, and hypothesis
testing. Although there are powerful software
packages dedicated to statistical modeling, such
as SPSS and SAS, todays spreadsheets contain a
large set of statistical analysis models.
105
The Model Base

• Graphical models
• Project management models

106
Graphical modeling tools help decision makers
develop and use graphic displays of data and
information. Although simple graphic modeling
tools exist, such as PowerPoint or Visio, there
are also sophisticated, high-end tools, such as
computer-assisted design (CAD) software. Project
management models are used to coordinate and
control projects and identify critical activities
or tasks that could delay a project if not
completed on time.
107
Group Decision Support Systems
108
Although decision support systems help
individuals make better decisions, many business
decisions are made by groups. Higher level
managers often spend more than half their
decision-making time in meetings. Group decision
support systems, also called group support
systems or computerized collaborative work
systems, are designed to support group decision
making. Some types of GDSS software, called
groupware or workgroup software, help with group
scheduling, communications, and management.
Lotus Notes and Microsoft Exchange are examples
of such software.
109
Figure 10.17
110
A group decision support system, or GDSS,
contains most of the same components as a DSS,
plus GDSS software to support communications
between group members.
111
Characteristics of a GDSS

• Special design
• Ease of use
• Flexibility
• Decision-making support

112
GDSSs are designed to support effective group
communication and good decision making
techniques, as well as creative thinking. As a
general rule, any software that is hard to use,
wont be used. GDSS software must be especially
user friendly, since often groups have less
patience with bad software than do
individuals. Since different people may solve the
same problem in different ways, a GDSS should
support different approaches to decision-making,
as well as integrate their output into a common
view.
113
A GDSS supports group decision-making techniques,
such as the Delphi approach, brainstorming, group
consensus, and the nominal group technique.
114
Characteristics of a GDSS

• Anonymous input
• Reduction of negative group behavior
• Parallel communication
• Automated record keeping

115
Many GDSSs allow anonymous input, where group
members cannot identify who provided the input.
This allows people to focus on the merits of the
input without considering its source. Sometimes,
one or two individuals take over a group
discussion, preventing input from other members,
or a group member sidetracks the group into an
unrelated or nonproductive area. Another
negative group effect is called groupthink a
group thinks it has made the right decision
because all agree on it, without examining
alternatives. For these reasons, many
traditional meetings are unproductive.
116
GDSS designers try to design software that
reduces this kind of problem by including
procedures for effectively planning and managing
meetings into the software. Often a trained
facilitator leading a GDSS meeting also helps
avoid such problems. In traditional meetings,
only one person speaks at a time. More timid
members may never speak up, or a person may have
forgotten what he was going to say by the time
the current speaker is finished.
117
Using GDSS software, all participants can type
comments at the same time and read everyones
comments displayed on their monitor. This can
also keep meetings shorter. GDSSs can store each
anonymous comment, as well as voting results.
118
Figure 10.18
119
A GDSS can be configured in a number of ways,
depending on the needs of the group, the location
of participants, and frequency of the decision.
Figure 10.18 classifies alternatives by decision
frequency and the location of participants. When
group members are in the same location and group
decision making is frequent, group support
software is placed in individual offices and
participants communicate over a LAN. Software
such as Microsofts NetMeeting allows
participants to take control of the mouse and
work on a shared application while other watch.
Software such as Lotus Notes can be used to share
ideas and documents.
120
When decision frequency is low and participants
are geographically dispersed, teleconferencing is
often the appropriate alternative.
Teleconferencing can be used to connect
individuals or GDSS decision rooms using long
distance telecommunications technology. A wide
area decision network is appropriate for high
frequency decisions made by people who are
scattered geographically. A decision room is
appropriate when participants are located in the
same place and occasionally use the GDSS for
decisions.
121
Figure 10.19
122
A decision room combines face-to-face interaction
and GDSS technology. Figure 10.19 shows a
typical decision room layout.
123
Executive Support Systems
124
Executive support systems, or executive
information systems, were developed to provide
senior managers the type of information they
need, in the format that they need it. Executive
support systems include a DSS, as well as other
tools, such as office automation.
125
Figure 10.20
126
Figure 10.20 shows the top layers of management
that executive support systems were originally
designed for. Today, their use is not restricted
to top management, since many organizations have
reengineered business processes and given
employees more decision-making authority.
127
Executive Support Systems (ESS) in Perspective

• Tailored to individual executives
• Easy to use
• Drill down capabilities
• Access to external data
• Can help when uncertainty is high
• Future-oriented
• Linked to value-added processes.

128
Although executive support systems have much in
common with decision support systems, they have
important differences. Generally, a DSS provides
a number of modeling tools and is designed to
help a user answer a question. Executive support
systems allow executives to ask the right
questions. An ESS is interactive and helps an
executive focus, filter and organize data and
information. Unlike a DSS, an ESS is usually
customized for a specific individual. Content
and format can both be customized. Since
executives are typically busy, an ESS must be
easy to learn and to use or it wont be used.
129
Capabilities of an ESS

• Support for defining an overall vision
• Support for strategic planning
• Support for strategic organizing staffing
• Support for strategic control
• Support for for crisis management

130
Most executive support systems are designed to
give the user a top-down view of business
processes and allow him to drill down to greater
levels of detail. This capability, as well as
access to external databases and to DSS modeling
tools, allows top-level managers to work on long
term, strategic issues that affect the whole
company.