Chapter 1: DECISION SUPPORT SYSTEMS AND BUSINESS INTELLIGENCE - PowerPoint PPT Presentation

View by Category
About This Presentation
Title:

Chapter 1: DECISION SUPPORT SYSTEMS AND BUSINESS INTELLIGENCE

Description:

Chapter 1: DECISION SUPPORT SYSTEMS AND BUSINESS INTELLIGENCE DECISION SUPPORT SYSTEMS AND BUSINESS INTELLIGENCE , Eighth Edition * Modeling in DSS (cont.) – PowerPoint PPT presentation

Number of Views:846
Avg rating:3.0/5.0
Slides: 50
Provided by: Jud8189
Category:

less

Write a Comment
User Comments (0)
Transcript and Presenter's Notes

Title: Chapter 1: DECISION SUPPORT SYSTEMS AND BUSINESS INTELLIGENCE


1
Chapter 1DECISION SUPPORT SYSTEMS AND BUSINESS
INTELLIGENCE
  • DECISION SUPPORT SYSTEMS AND BUSINESS
    INTELLIGENCE , Eighth Edition

2
Changing Business Environments and Computerized
Decision Support
  • The business pressures-responses-support model
  • The business environment
  • Business environment factors divided into four
    categories markets, consumer demands,
    technology, and societal.

3
Changing Business Environments and Computerized
Decision Support (cont.)
  • Organizational responses be reactive,
    anticipative, adaptive, and proactive
  • Employ strategic planning
  • Use new and innovative business model
  • Restructure business process
  • Use new IT to improve communication.

4
Changing Business Environments and Computerized
Decision Support (cont.)
  • Computerized support
  • It used to facilitate closing the gap between the
    current performance and the desired performance.

5
Changing Business Environments and Computerized
Decision Support (cont.)
6
Management Support Systems (MSS)
  • Four major information technologies have been
    successfully used to support managers.
  • DSSs provide support primarily to analytical,
    quantitative types of decisions.
  • Executive (enterprise) support systems support
    the informational roles of executives.
  • Group decision support systems support
    managers working in groups.
  • Intelligent systems provide mulitfunctional
    support.

7
DSS Definition
  • Decision support system (DSS) are used to make
    business decision often based on data collected
    by On-Line-Analytical-Processing system (OLAP)
  • Example of data used for making decision
  • Retail sales transaction detail
  • DSS as an Umbrella term Describes any
    computerized system that supports decision making
    in an organization

8
Why Use of DSS
  • Why use decision support systems?
  • Speedy computations
  • Improved communication and collaboration
  • Increased productivity of group members
  • Improved data management
  • Managing giant data warehouses
  • Quality support
  • Overcoming cognitive limits in processing and
    storing information

9
Why Use of DSS(cont.)
  • Using the Web
  • Anywhere, anytime support

10
Decision Making and Management
  • Management is a process by which organizational
    goals are achieved through the use of resources
    (people, money, energy, materials, space, time).
  • These resources are considered to be inputs, and
    the attainment of the goals is viewed as the
    output of the process.
  • Measuring success
  • Productivity output/input

11
Decision Making and Management (cont.)
  • Management is decsion making
  • The manager is decsion maker

12
Decision Making and Management (cont.)
  • The nature of managers work
  • Interpersonal figurehead, leader, liaison.
  • Informational monitor, disseminator,
  • spokesperson.
  • Decisional entrepreneur, disturbance handler,
  • resource allocator, negotiator.

13
Decision Making and Management (cont.)
  • Why Managers Need IT Support
  • processing information manually is growing
    increasingly difficult
  • computerized modeling
  • examining numerous alternatives very quickly
  • providing a systematic risk analysis
  • being integrated with communication systems and
    databases
  • being used to support group work

14
Phases of the Decision Making
15
Phases of the Decision Making (cont.)
  • Intelligence phase
  • Organizational objectives
  • Search and scanning procedures
  • Data collection
  • Problem identification
  • Problem classification
  • Problem statement
  • Result
  • Reality is examined
  • The problem is identified and defined

16
Phases of the Decision Making(cont.)
  • Design phase
  • Formulate a model (Assumption)
  • Set criteria for choice
  • Search for alternative
  • Predict and measure outcomes
  • Result
  • Representative model is constructed
  • The model is validated and evaluation criteria
    are set

17
Phases of the Decision Making(cont.)
  • Choice phase
  • solution to the model
  • Sensitivity analysis
  • Selection of Best (Good) alternative
  • Plan for implementation
  • Design of control system
  • Result
  • Proposed solution is included to the model
  • If reasonable, move to implementation phase.

18
Phases of the Decision Making(cont.)
  • Implementation phase
  • Put solution into action
  • Result
  • Solution to the original problem

19
Decision Making Processes
  • The process of decision making
  • Defining the problem (i.e., a decision situation
    that may deal with some difficulty or with an
    opportunity)
  • Constructing a model that describes the
    real-world problem
  • Identifying possible solutions to the modeled
    problem and evaluating the solutions
  • Comparing, choosing, and recommending a potential
    solution to the problem

20
Decision makers Who are They?
  • Decision maker classification
  • Individual decision makers can be single person
    or a computer system
  • Multiple decision makers can be
  • Team where members support a single decision
    maker
  • Groups where all members have a say in the
    decision
  • Organization where global agreement is needed.

21
Framework for Computerized Decision Support
Support Needed
22
Framework for Computerized Decision Support
(cont.)
  • Three type of decision
  • 1- Structured problems are routine problems for
    which standard solution method exist.
  • Procedure for obtaining the best solution are
    known
  • Objective are clearly defined

23
Framework for Computerized Decision Support
(cont.)
  • 2- Unstructured problems are fuzzy, complex
    problem for which there are no cut-and direct
    solution methods.
  • Have no structure phase
  • Often solved with human intuition
  • 3- Semi-structured problem is a decision problem
    in which some but not all phases are structured.
  • In between solve with standard solution procedure
    and human judgment

24
Framework for Computerized Decision Support
(cont.)
  • Types of control in all managerial activities
  • Strategic planning
  • the long-range goals policies for resource
    allocation
  • Management control
  • the acquisition efficient utilization of
    resources in the accomplishment of organizational
    goals
  • Operational control
  • the efficient effective execution of specific
    tasks.

25
Framework for Computerized Decision Support
(cont.)
  • The decision support matrix
  • For semistructured decisions and unstructured
    decisions, conventional MIS and MS tools are
    insufficient BUT Decision support systems (DSS)
    are used.
  • Computer support for structured decisions
  • Management science (MS) or operations research
    (OR) are used .
  • Automated decision systems (ADS) is used.

26
Framework for Computerized Decision Support
(cont.)
  • Management science (MS) or operations research
    (OR) The application of a scientific approach and
    mathematical models to the analysis and solution
    of managerial decision situations (e.g.,
    problems, opportunities)
  • It adds new step 2 to the process of decision
    making, that is classify the problem into
    standard category.

27
Framework for Computerized Decision Support
(cont.)
  • Automated decision systems (ADS) A business
    rules-based system that uses intelligence to
    recommend solutions to repetitive decisions (such
    as pricing)

28
Architecture of a decision system
29
Architecture of a decision system(cont.)
  • The architecture of DSS
  • Data
  • Models manipulate data as related to a specific
    situation
  • Knowledge component
  • User interface
  • The user themselves are also important
    components of the architecture

30
Structure of a decision system
  • A SYSTEM is a collection of object such as
    people, resources, concepts and procedure
    intended to perform an identifiable function or
    to serve a goal.
  • Three Distinct Parts of Systems
  • Inputs
  • Processes
  • Outputs

31
Structure of a decision system (cont.)
Input(s)
output(s)
Processes
Feedback (flow of information
32
Structure of a decision system (cont.)
  • Inputs are the element that enter the system
  • Processes convert or transform inputs into
    outputs
  • Outputs describe finished products or
    consequences of being in the system
  • Feedback is the flow of information from the
    output to decision maker, who many modify the
    inputs or the processes (closed loop)
  • The Environment contains the elements that lie
    outside but impact the system performance

33
Modeling in DSS
  • DSS is model-base set of procedures for
    processing data and judgment to assist manager in
    his decision making
  • A model is simplified representation or
    abstraction of (complex) reality.
  • With modeling, one can perform virtual
    experiments and an analysis on a model of
    reality, rather than on reality itself.

34
Modeling in DSS (cont.)
  • Four groups of models
  • Iconic (scale) Model
  •  An iconic modelthe least abstract modelis a
    physical replica of a system.
  • Analog Model
  • does not look like the real system but behaves
    like it.

35
Modeling in DSS (cont.)
  • Mathematical Model
  • Use mathematical relationship to represent
    complexity used in most DSS analysis
  • Mental models
  • provide a description of how a person thinks
    about a situation

36
Modeling in DSS (cont.)
  • Benefits of Models
  • Time compression
  • Low cost construction
  • Models allow for the simulated compression of
    time.
  • Manipulating the model (by changing variables) is
    much easier than manipulating the real system.
  • Can model large and extermely complex system with
    possibly infinite soultion.
  • Low cosst excustion

37
Modeling in DSS (cont.)
  • Modeling process and solution approach
  • Trail and Error
  • Simulation
  • Optimization
  • Heuristics

38
Decision analysis
  • Decision analysis allow us to select a decision
    from set of possible decision alternatives when
    uncertainties regarding the future exist.
  • The goal is to optimize the resulting return
    (payoff) in term of decision criteria.

39
Decision analysis (cont.)
  • Type of decision analysis models
  • Decision making under certainty
  • Decision making under uncertainty
  • Decision making under risk
  • Decision making with perfect information
  • Decision making with imperfect information(Bayesia
    n Theory)
  • Decision making in light of competitive action
    (Game Theory)

40
DSS and Data Warehouse
  • Data warehouse is a decision support database.
  • The data warehouse is an integrated,
    subject-oriented, time-variant, non-volatile
    database that provide support for decision
    making.

41
DSS and Data Warehouse
  • Integrated the data warehouse is centralized,
    consolidated database that integrates data
    retrieved from the entire organization.
  • Subject- oriented data of data warehouse is
    arranged and optimized to provide answer to
    questions coming from diverse functional area
    within a company.

42
DSS and Data Warehouse
  • Time-variant the data warehouse represent the
    flow of data through time
  • Non-volatile once data enter the data warehouse,
    they are never removed.

43
On-Line Analytical Processing (OLAP)
  • It is an element of DSS.
  • It is support ad-hoc querying for business
    analyst.
  • Multidimensional view of data is foundation of
    OLAP

Multidimensional data
44
DSS knowledge base
  • Any true decision requires information.
  • The knowledge base is where all information is
    stored.

45
  • CASE STUDY

46
Case Managing Global Business at 3M Corporation
  • The Business Problem
  • The company had difficulties responding
  • to new customers and markets in the global
    economy as each business unit kept separate
    databases and conducted independent decision
    support activities
  • The Solution
  • The Company created a global enterprise data
    warehouse (GEDW)

47
Case Managing Global Business at 3M Corporation
(cont.)
  • The Results
  • Distributors and retailers, as well as end-users,
    now receive information in minutes instead of
    weeks or months, including the delivery of rich
    multimedia
  • Customers can find all their information in one
    place
  • Inventories are lower, and better and quicker
    inventory decisions are made, even in globally
    remote locations

48
Case Managing Global Business at 3M Corporation
(cont.)
  • What have we learned from this case??
  • The case demonstrates the existence of vast
    amounts of important data in organizations, and
    the importance of organizing that data for
    optimum use
  • The case shows the need to share a companys data
    internally and with business partners and
    customers, and to make it available in a format
    that enables end users to process data quickly
  • The case explains the data warehouse, and its
    role in supporting managerial decision making

49
Duty 1
  • Each group have present one case study under
    these conditions
  • define organization
  • Define business problem
  • Provide possible solutions
  • The result.
About PowerShow.com