Dss

Information and Decision Support Systems

Principles and Learning Objectives • Good decision-making and problem-solving skills are the key to developing effective information and decision support systems. – Define the stages of decision making. – Discuss the importance of implementation and monitoring in problem solving.

Principles and Learning Objectives • The management information system (MIS) must provide the right information to the right person in the right fashion at the right time. – Define the term MIS and clearly distinguish the difference between a TPS and an MIS. – Discuss information systems in the functional areas of business organizations.

Principles and Learning Objectives • Decision support systems (DSSs) are used when the problems are more unstructured. – List and discuss important characteristics of DSSs that give them the potential to be effective management support tools. – Identify and describe the basic components of a DSS.

Principles and Learning Objectives • Specialized support systems, such as group decision support systems (GDSSs) and executive support systems (ESSs), use the overall approach of a DSS in situations such as group and executive decision making. – State the goals of a GDSS and identify the characteristics that distinguish it from a DSS. – Identify the fundamental uses of an ESS and list the characteristics of such a system.

Decision Making and Problem Solving

Decision Making as a Component of Problem Solving

Programmed versus Nonprogrammed Decisions • Programmed decisions – – – –

Structured situations with well defined relationships Quantifiable Management information system Easy to computerize

• Nonprogrammed decisions – Rules and relationships not defined – Problem is not routine – Not easily quantifiable

Problem Solving Approaches • Optimization: find the best solution • Satisficing: find a good solution • Heuristics: rules of thumb

An Overview of Management Information Systems

Inputs to an MIS

Outputs of an MIS

Outputs of an MIS

Developing Effective Reports

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

Functional Aspects of the MIS

Functional Aspects of an MIS

Financial MIS

Manufacturing MIS • Design engineering • Process control – Computer-assisted manufacturing (CAM) – Computer-integrated manufacturing (CIM) – Flexible manufacturing system

• Quality control and testing

Overview of a Manufacturing MIS

Marketing MIS

Product Pricing

Product Pricing

Human Resource MIS

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

An Overview of Decision Support Systems

Characteristics of Decision Support Systems • Handle large amounts of data from various sources • Provide report and presentation flexibility • Offer both textual and graphical orientation • Support drill down analysis

Characteristics of a DSS • Perform complex, sophisticated analysis • Optimization, satisficing, heuristics – Simulation – What-if analysis – Goal-seeking analysis

Characteristics of a DSS

Capabilities of a DSS • Support all problem-solving phases • Support different decision frequencies • Support different problem structures • Support various decision-making levels

Selected DSS Applications

Support for Various Decision-Making Levels

Comparison of DSSs and MISs

Comparison of DSSs and MISs

Components of a DSS

Components of a DSS

The Model Base •

Financial models – Cash flow – Internal rate of return

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Statistical analysis models – Summary statistics – Trend projections – Hypothesis testing

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Graphical models Project management models

The Model Base

Data-driven versus Model-driven DSS • Data-driven DSS - primarily performs qualitative analysis based on the company’s databases • Model-driven DSS - primarily performs mathematical or quantitative analysis

Group Decision Support Systems

Group Decision Support System

Characteristics of a GDSS • • • • • • • •

Special design Ease of use Flexibility Decision-making support Anonymous input Reduction of negative group behavior Parallel communication Automated record keeping

GDSS Alternatives

The Decision Room

Executive Support Systems

Executive Support Systems

Executive Support Systems (ESS) in Perspective • • • • • • •

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

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 crisis management

Summary • Management information system - an integrated collection of people, procedures, databases, and devices that provide managers and decision-makers with information to help achieve organizational goals • Decision-making phase: includes intelligence, design, and choice • Problem solving: also includes implementation and monitoring • Decision approaches: optimization, satisficing, and heuristic

Summary • Decision support system (DSS) - an organized collection of people, procedures, software, databases, and devices working to support managerial decision making • Group decision support system (GDSS) - also called a computerized collaborative work system, consists of most of the elements in a DSS, plus software needed to provide effective support in group decision-making settings • Executive support systems (ESSs) - specialized decision support systems designed to meet the needs of senior management

Specialized Business Information Systems

Principles and Learning Objectives •

Artificial intelligence systems form a broad and diverse set of systems that can replicate human decision making for certain types of well-defined problems. – Define the term artificial intelligence and state the objective of developing artificial intelligence systems. – List the characteristics of intelligent behavior and compare the performance of natural and artificial intelligence systems for each of these characteristics. – Identify the major components of the artificial intelligence field and provide one example of each type of system.

Principles and Learning Objectives • Expert systems can enable a novice to perform at the level of an expert but must be developed and maintained very carefully. – List the characteristics and basic components of expert systems. – Identify at least three factors to consider in evaluating the development of an expert system. – Outline and briefly explain the steps for developing an expert system. – Identify the benefits associated with the use of expert systems.

Principles and Learning Objectives • Virtual reality systems have the potential to reshape the interface between people and information technology by offering new ways to communicate information creatively. – Define the term virtual reality and provide three examples of virtual reality applications.

• Special-purpose systems can help organizations and individuals achieve their goals. – Discuss examples of special-purpose systems for organizational and individual use.

An Overview of Artificial Intelligence

The Nature of Intelligence • Learn from experience & apply the knowledge • Handle complex situations • Solve problems when important information is missing • Determine what is important

The Nature of Intelligence • • • • •

React quickly & correctly to new situations Understand visual images Process & manipulate symbols Be creative & imaginative Use heuristics

The Difference Between Natural and Artificial Intelligence

The Major Branches of Artificial Intelligence

An Overview of Expert Systems

Characteristics of an Expert System • • • • • •

Can explain their reasoning or suggested decisions Can display “intelligent” behavior Can draw conclusions from complex relationships Can provide portable knowledge Can deal with uncertainty Not widely used or tested

Characteristics of an Expert System • • • • • •

Limited to relatively narrow problems Cannot readily deal with “mixed” knowledge Possibility of error Cannot refine its own knowledge May have high development costs Raise legal and ethical concerns

Capabilities of an Expert Systems • • • • • •

Strategic goal setting Planning Design Decision-making Quality control and monitoring Diagnosis

Capabilities of Expert Systems

When to Use Expert Systems • • • • • •

High payoff Preserve scarce expertise Distribute expertise Provide more consistency than humans Faster solutions than humans Training expertise

Components of an Expert System

Knowledge Base • • • •

Assembling human experts The use of fuzzy logic The use of rules The use of cases

Knowledge Base

The Use of Rules

The Knowledge Acquisition Facility

Components of an Expert System • The explanation facility • The knowledge acquisition facility • The user interface

Expert Systems Development

Participants in Developing and Using Expert Systems • Domain expert • Knowledge engineer • Knowledge user

Participants in Developing and Using Expert Systems

Domain Experts • • • • • •

Recognize the real problem Develop a general framework for problem solving Formulate theories about the situation Develop and use general rules to solve a problem Know when to break the rules or general principles Solve problems quickly and efficiently

Expert Systems Development Tools and Techniques

Expert Systems Development Tools and Techniques

Expert Systems Development Alternatives

Applications of Expert Systems and Artificial Intelligence • • • •

Credit granting and loan analysis Stock picking Catching cheats and terrorists Budgeting

Virtual Reality

Virtual Reality • Enables one or more users to move and react in a computer-simulated environment • Immersive virtual reality - user becomes fully immersed in an artificial, three-dimensional world that is completely generated by a computer • Virtual reality system - enables one or more users to move and react in a computer-simulated environment

Useful Applications • Medicine – used to link stroke patients to physical therapists • Education and training – used by military for aircraft maintenance • Entertainment – Star Wars Episode II: Attack of the Clones

Useful Applications • Real Estate Marketing and Tourism – Used to increase real estate sales – Virtual reality tour of the White House

Summary •

Artificial intelligence - used to describe computers with ability to mimic or duplicate functions of the human brain

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Intelligent behavior - includes the ability to learn from experience

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Expert systems - can explain their reasoning (or suggested decisions) and display intelligent behavior

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Virtual reality systems - enables one or more users to move and react in a computer-simulated environment

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Special-purpose systems - assist organizations and individuals in new and exciting ways. For example, Segway