Decision Support Systems

Identify the changes taking place in the form and use of decision support in business
Identify the role and reporting alternatives of management information systems Describe how online analytical processing can meet key information needs of managers

Explain the decision support system concept and how it differs from traditional management information systems
102

Explain how the following information systems can support the information needs of executives, managers, and business professionals
Executive information systems Enterprise information portals Knowledge management systems

Identify how neural networks, fuzzy logic, genetic algorithms, virtual reality, and intelligent agents can be used in business
103

Give examples of several ways expert systems can be used in business decision-making situations

104

Companies are investing in data-driven decision support application frameworks to help them respond to
Changing market conditions
Customer needs

This is accomplished by several types of

Management information
Decision support Other information systems

105

106

Information products made more valuable by their attributes, characteristics, or qualities

Information that is outdated, inaccurate, or hard to understand has much less value

Information has three dimensions

Time Content Form

107

108

Structured (operational)
The procedures to follow when decision is needed can be specified in advance

Unstructured (strategic)
It is not possible to specify in advance most of the decision procedures to follow

Semi-structured (tactical)
Decision procedures can be pre-specified, but not enough to lead to the correct decision

109

Management Information Systems Decision support provided Information form and frequency Information format Information processing methodology Provide information about the performance of the organization Periodic, exception, demand, and push reports and responses Prespecified, fixed format Information produced by extraction and manipulation of business data

Decision Support Systems Provide information and techniques to analyze specific problems Interactive inquiries and responses Ad hoc, flexible, and adaptable format Information produced by analytical modeling of business data

1010

The emerging class of applications focuses on

Personalized decision support

Modeling
Information retrieval Data warehousing

What-if scenarios
Reporting

1011

1012

Decision support systems use the following to support the making of semi-structured business decisions
Analytical models Specialized databases A decision-makers own insights and judgments An interactive, computer-based modeling process

DSS systems are designed to be ad hoc, quick-response systems that are initiated and controlled by decision makers
1013

1014

Model Base
A software component that consists of models used in computational and analytical routines that mathematically express relations among variables

Spreadsheet Examples
Linear programming Multiple regression forecasting Capital budgeting present value

1015

 Supply Chain: simulate and optimize supply chain flows, reduce inventory, reduce stock-outs
Pricing: identify the price that maximizes yield or profit Product and Service Quality: detect quality problems early in order to minimize them Research and Development: improve quality, efficacy, and safety of products and services

1016

The original type of information system that supported managerial decision making
Produces information products that support many day-to-day decision-making needs Produces reports, display, and responses Satisfies needs of operational and tactical decision makers who face structured decisions

1017

Periodic Scheduled Reports

Prespecified format on a regular basis

Exception Reports
Reports about exceptional conditions
May be produced regularly or when an exception occurs

Demand Reports and Responses

Information is available on demand

Push Reporting
Information is pushed to a networked computer
1018

OLAP
Enables managers and analysts to examine and manipulate large amounts of detailed and consolidated data from many perspectives Done interactively, in real time, with rapid response to queries

1019

Consolidation
Aggregation of data Example: data about sales offices rolled up to the district level

Drill-Down
Display underlying detail data Example: sales figures by individual product

Slicing and Dicing

Viewing database from different viewpoints Often performed along a time axis

1020

GIS
DSS uses geographic databases to construct and display maps and other graphic displays

Supports decisions affecting the geographic distribution of people and other resources
Often used with Global Positioning Systems (GPS) devices

1021

DVS
Represents complex data using interactive, three-dimensional graphical forms (charts, graphs, maps) Helps users interactively sort, subdivide, combine, and organize data while it is in its graphical form

1022

Using a decision support system involves an interactive analytical modeling process

Decision makers are not demanding pre-specified information They are exploring possible alternatives

What-If Analysis
Observing how changes to selected variables affect other variables

1023

Sensitivity Analysis
Observing how repeated changes to a single variable affect other variables

Goal-seeking Analysis
Making repeated changes to selected variables until a chosen variable reaches a target value

Optimization Analysis
Finding an optimum value for selected variables, given certain constraints

1024

Provides decision support through knowledge discovery

Analyzes vast stores of historical business data Looks for patterns, trends, and correlations Goal is to improve business performance Regression Decision tree Neural network Cluster detection Market basket analysis
What product customer purchase together with other products.
1025

Types of analysis

1026

One of the most common uses for data mining

Determines what products customers purchase together with other products

Results affect how companies

Market products Place merchandise in the store Lay out catalogs and order forms Determine what new products to offer Customize solicitation phone calls

1027

EIS
Combines many features of MIS and DSS Provide top executives with immediate and easy access to information Identify factors that are critical to accomplishing strategic objectives (critical success factors) So popular that it has been expanded to managers, analysis, and other knowledge workers

1028

Information presented in forms tailored to the preferences of the executives using the system
Customizable graphical user interfaces
Exception reports Trend analysis

Drill down capability

1029

An EIP is a Web-based interface and integration of MIS, DSS, EIS, and other technologies
Available to all intranet users and select extranet users Provides access to a variety of internal and external business applications and services Typically tailored or personalized to the user or groups of users Often has a digital dashboard Also called enterprise knowledge portals

1030

1031

1032

1033

1034

AI is a field of science and technology based on

Computer science Biology Psychology Linguistics Mathematics Engineering

The goal is to develop computers than can simulate the ability to think
And see, hear, walk, talk, and feel as well

1035

Some of the attributes of intelligent behavior

Think and reason Use reason to solve problems

Learn or understand from experience

Acquire and apply knowledge Exhibit creativity and imagination

Deal with complex or perplexing situations

1036

Attributes of intelligent behavior (continued)

Respond quickly and successfully to new situations Recognize the relative importance of elements in a situation Handle ambiguous, incomplete, or erroneous information

1037

1038

Applications in the cognitive science of AI

Expert systems Knowledge-based systems Adaptive learning systems Fuzzy logic systems Neural networks Genetic algorithm software Intelligent agents

Focuses on how the human brain works and how humans think and learn
1039

AI, engineering, and physiology are the basic disciplines of robotics

Produces robot machines with computer intelligence and humanlike physical capabilities

This area include applications designed to give robots the powers of

Sight or visual perception Touch Dexterity Locomotion Navigation

1040

Major thrusts in the area of AI and the development of natural interfaces

Natural languages Speech recognition Virtual reality

Involves research and development in

Linguistics Psychology Computer science Other disciplines

1041

Decision Support
Helps capture the why as well as the what of engineered design and decision making

Information Retrieval
Distills tidal waves of information into simple presentations

Natural language technology

Database mining

1042

Virtual Reality
X-ray-like vision enabled by enhanced-reality visualization helps surgeons

Automated animation and haptic interfaces allow users to interact with virtual objects

Robotics
Machine-vision inspections systems Cutting-edge robotics systems
From micro robots and hands and legs, to cognitive and trainable modular vision systems

1043

An Expert System (ES)

A knowledge-based information system Contain knowledge about a specific, complex application area Acts as an expert consultant to end users

1044

Knowledge Base
Facts about a specific subject area Heuristics that express the reasoning procedures of an expert (rules of thumb)

Software Resources
An inference engine processes the knowledge and recommends a course of action User interface programs communicate with the end user Explanation programs explain the reasoning process to the end user
1045

1046

Case-Based
Knowledge organized in the form of cases Cases are examples of past performance, occurrences, and experiences

Frame-Based
Knowledge organized in a hierarchy or network of frames A frame is a collection of knowledge about an entity, consisting of a complex package of data values describing its attributes

1047

Object-Based
Knowledge represented as a network of objects An object is a data element that includes both data and the methods or processes that act on those data

Rule-Based
Knowledge represented in the form of rules and statements of fact
Rules are statements that typically take the form of a premise and a conclusion (If, Then)
1048

Decision Management
Loan portfolio analysis Employee performance evaluation Insurance underwriting

Diagnostic/Troubleshooting
Equipment calibration Help desk operations Medical diagnosis Software debugging

1049

Design/Configuration
Computer option installation Manufacturability studies Communications networks

Selection/Classification
Material selection Delinquent account identification Information classification Suspect identification

Process Monitoring/Control
1050

Process Monitoring/Control
Machine control (including robotics) Inventory control Production monitoring Chemical testing

1051

Captures the expertise of an expert or group of experts in a computer-based information system

Faster and more consistent than an expert
Can contain knowledge of multiple experts Does not get tired or distracted Cannot be overworked or stressed Helps preserve and reproduce the knowledge of human experts

1052

The major limitations of expert systems

Limited focus Inability to learn

Maintenance problems
Development cost Can only solve specific types of problems in a limited domain of knowledge

1053

Suitability Criteria for Expert Systems

Domain: the domain or subject area of the problem is small and well-defined

Expertise: a body of knowledge, techniques, and intuition is needed that only a few people possess
Complexity: solving the problem is a complex task that requires logical inference processing

1054

Suitability Criteria for Expert Systems

Structure: the solution process must be able to cope with ill-structured, uncertain, missing, and conflicting data and a changing problem situation Availability: an expert exists who is articulate, cooperative, and supported by the management and end users involved in the development process

1055

Expert System Shell

The easiest way to develop an expert system A software package consisting of an expert system without its knowledge base Has an inference engine and user interface programs

1056

A knowledge engineer
Works with experts to capture the knowledge (facts and rules of thumb) they possess

Builds the knowledge base, and if necessary, the rest of the expert system
Performs a role similar to that of systems analysts in conventional information systems development

1057

Computing systems modeled after the brains mesh-like network of interconnected processing elements (neurons)
Interconnected processors operate in parallel and interact with each other
Allows the network to learn from the data it processes

1058

Fuzzy logic
Resembles human reasoning Allows for approximate values and inferences and incomplete or ambiguous data Uses terms such as very high instead of precise measures Used more often in Japan than in the U.S. Used in fuzzy process controllers used in subway trains, elevators, and cars

1059

1060

Genetic algorithm software

Uses Darwinian, randomizing, and other mathematical functions

Simulates an evolutionary process, yielding increasingly better solutions to a problem

Being uses to model a variety of scientific, technical, and business processes

Especially useful for situations in which thousands of solutions are possible

1061

Virtual reality is a computer-simulated reality

Fast-growing area of artificial intelligence Originated from efforts to build natural, realistic, multi-sensory human-computer interfaces Relies on multi-sensory input/output devices Creates a three-dimensional world through sight, sound, and touch Also called telepresence

1062

Current applications of virtual reality

Computer-aided design Medical diagnostics and treatment

Scientific experimentation
Flight simulation Product demonstrations

Employee training
Entertainment

1063

A software surrogate for an end user or a process that fulfills a stated need or activity
Uses built-in and learned knowledge base to make decisions and accomplish tasks in a way that fulfills the intentions of a user Also call software robots or bots

1064

 Interface Tutors observe user computer operations, correct user mistakes, provide hints/advice on efficient software use
Presentation Agents show information in a variety of forms/media based on user preferences Network Navigation Agents discover paths to information, provide ways to view it based on user preferences Role-Playing play what-if games and other roles to help users understand information and make better decisions

1065

 Search Agents help users find files and databases, search for information, and suggest and find new types of information products, media, resources
Information Brokers provide commercial services to discover and develop information resources that fit business or personal needs Information Filters Receive, find, filter, discard, save, forward, and notify users about products received or desired, including e-mail, voice mail, and other information media

1066