Decision Support Systems - Chapter 1: Management Support Systems: An Overview

Chapter 1Management Support Systems:An OverviewDecision Support Systems1© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangOutline1.Managers and decision making2.Managerial decision making and information systems3.A framework for decision making4.The concept of decision support systems5. Executive Information Systems6. Expert Systems7. Knowledge management systems8. Hybrid support systems9. Emerging Technologies2© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang1.Managers and decision making Mintzberg’s 10 Management RolesInterpersonalFigureheadLeaderLiaisonInformationalMonitorDisseminatorSpokespersonDecisionalEntrepreneurDisturbance HandlerResource AllocationNegotiator3© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangFactors Affecting Decision-MakingNew technologies and better information distribution have resulted in more alternatives for management.Complex operations have increased the costs of errors, causing a chain reaction throughout the organization.Rapidly changing global economies and markets are producing greater uncertainty and requiring faster response in order to maintain competitive advantages.Increasing governmental regulation coupled with political destabilization have caused great uncertainty.4© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang2. Managerial Decision Making and Information SystemsProductivity is the ratio of outputs to inputs that measures the degree of success of an organization and its individual parts.Productivity is a major concern for any organization since it determines the well-being of the organization.5© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangWhat do Decision Support Systems Offer?Quick computations at a lower costGroup collaboration and communicationIncreased productivityReady access to information stored in multiple databases and data warehouseAbility to analyze multiple alternatives and apply risk managementEnterprise resource managementTools to obtain and maintain competitive advantage6© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangCognitive LimitsThe human mind has limited processing and storage capabilities.Any single person is therefore limited in their decision making abilities.Collaboration with others allows for a wider range of possible answers, but will often be faced with communications problems.Computers improve the coordination of these activities.This knowledge sharing is enhanced through the use of GSS, KMS, and EIS.7© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangManagement Support SystemsThe support of management tasks by the application of technologiesSometimes called Decision Support Systems or Business Intelligence8© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangManagement Support Systems ToolsDSSManagement ScienceBusiness AnalyticsData MiningData WarehouseBusiness IntelligenceOLAPCASE toolsGSSEIS (Executive IS)EIPERM (Enterprise resourse management)ERP (Enterprise resource planning)CRM (customer relationship management)SCM (supply chain..)KMS (knowledge management system)KMPESANNIntelligent AgentsE-commerce DSS9© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang3. Decision Support FrameworksDecision making processes fall along a continuum that ranges from highly structured to highly unstructured decision.Structured processes are routine, and repetitive problems for which standard solution methods exist.Unstructured processes are fuzzy, complex problems for which there are no clear-cut solution methods.In a structured problem, the procedures for obtaining the best solution are known.In an unstructured problem, human intuition is often the basis for decision making.10© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangDecision Support FrameworksType of ControlType of Decision:Operational ControlManagerial ControlStrategic PlanningStructured(Programmed)Accounts receivable, accounts payable, order entryBudget analysis, short-term forecasting, personnel reportsInvestments, warehouse locations, distribution centersSemistructuredProduction scheduling, inventory controlCredit evaluation, budget preparation, project scheduling, rewards systemsMergers and acquisitions, new product planning, compensation, QA, HR policy planningUnstructured(Unprogrammed)Buying software, approving loans, help deskNegotiations, recruitment, hardware purchasingR&D planning, technology development, social responsibility plans11© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangTechnologies for Decision-Making ProcessesType of DecisionTechnology Support NeededStructured(Programmed)MIS, Management Science Models, Transaction ProcessingSemistructuredDSS, KMS, GSS, CRM, SCMUnstructured(Unprogrammed)GSS, KMS, ES, Neural networksGSS: Group Support System12© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangTechnology Support Based on Anthony’s TaxonomyType of ControlOperational ControlManagerial ControlStrategic PlanningTechnology Support NeededMIS, Management ScienceManagement Science, DSS, ES, EIS, SCM, CRM, GSS, SCMGSS, CRM, EIS, ES, neural networks, KMS13© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang14© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangManagement Science/Operations ResearchAdopts systematic approach with the following steps:Define the problemClassify the problem into standard categoryConstruct a mathematical modelFind potential solutions to the modeled problem and evaluate themSelect a solution to the problem15© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang4.The concept of Decision Support Systems“Decision support systems couple the intellectual resources of individuals with the capacities of the computer to improve the quality of decisions. It is a computer-based support system for management decision makers who deal with semi-structured problems.” [Keen and Scott Morton, 1978]There is no universally accepted definition of DSS.DSS is an umbrella term.16© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang5. Enterprise Information SystemsEvolved from Executive Information Systems combined with Web technologiesEIPs view information across entire organizationsProvide rapid access to detailed information through drill-down.Provide user-friendly interfaces through portals.Identifies opportunities and threats17© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and LiangEnterprise Information SystemsSpecialized systems include ERM, ERP, CRM, and SCMProvides timely and effective corporate level tracking and control.Filter, compress, and track critical data and information.ERM: Enterprise Resource ManagementCRM: Customer Relationship ManagementSCM: Supply Chain Management18© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang6. Expert SystemsTechnologies that apply reasoning methodologies in a specific domainAttempts to mimic human experts’ problem solvingExpertise is transferred from the expert to a computer.ESs consist of knowledge-base and inference engine.Examples include:Artificial Intelligence SystemsArtificial Neural Networks (neural computing)Genetic AlgorithmsFuzzy LogicIntelligent Agents19© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang7. Knowledge Management SystemsKnowledge that is organized and stored in a repository for use by an organizationCan be used to solve similar or identical problems in the futureKnowledge management systems appears in a variety of formats, and they can be used to support decision making in several ways.Knowledge baseKnowledge asquisition20© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang8. Hybrid Support SystemsIntegration of different computer system tools to resolve problemsTools perform different tasks, but support each otherTogether, produce more sophisticated answersWork together to produce smarter answersTightly integrated systems or loosely integrated systems.21© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang9.Emerging TechnologiesGrid computingImproved GUIsModel-driven architectures with code reuseWireless computingIntelligent agentsGenetic algorithmsMetaheuristics and new problem-solving techniques22© 2005 Prentice Hall, Decision Support Systems and Intelligent Systems, 7th Edition, Turban, Aronson, and Liang