1. Topics Lesson 9
Support Systems
MIS DSS ESS

2. Decision Making and Problem Solving
Before looking at the information systems designed to help decision makers and problem solvers, we should understand the decision making and problem solving processes.

3. Decision Making as a Component of Problem Solving
Figure 10.1: How Decision Making Relates to Problem Solving
Principles of Information Systems, Eighth Edition

4. Programmed versus Nonprogrammed Decisions
Structured situations with well defined relationships
Quantifiable
Management information system
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. 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.

5. Programmed versus Nonprogrammed Decisions
Ill-structured situations with vague or changing relationships between variables
Not easily quantifiable in advance
Decision support systems
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.
Decision support systems are designed to help decision makers with nonprogrammed or ill-structured problems.

6. Problem Solving Approaches
Optimization: find the best solution
Satisficing: find a good solution
Heuristics: use rules of thumb
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.
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.
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 isn’t an optimal solution – since sometimes you carry an umbrella unnecessarily and sometimes it rains on days when you don’t have an umbrella. But the cost of finding an optimal solution is far too great in terms of time and money.

7. An Overview of Management Information Systems
Management information systems provides decision-makers information and feedback on daily operations. Additionally, management information systems can be used strategically, often incorporating Web technology.

8. Management Information Systems in Perspective
Figure 10.3: Sources of Managerial Information
Principles of Information Systems, Eighth Edition

9. Outputs of a Management Information System
Figure 10.4: An Executive Dashboard
Principles of Information Systems, Eighth Edition

10. Outputs of a Management Information System (continued)
Scheduled report: produced periodically, or on schedule, such as daily, weekly, or monthly
Key-indicator report: summary of previous day’s critical activities
Demand report: developed to give certain information at someone’s request
Exception report: automatically produced when a situation is unusual or requires management action
Drill-down reports: provide increasingly detailed data about a situation
Principles of Information Systems, Eighth Edition

11. Outputs of a Management Information System (continued)
Figure 10.5: Reports Generated by an MIS
Principles of Information Systems, Eighth Edition

12. 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
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. 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.

13. Functional Aspects of the MIS
Each management information system is an integrated collection of subsystems, often organized along functional lines of an organization.

14. Functional Aspects of the MIS
Figure 10.6: An Organization’s MIS
Principles of Information Systems, Eighth Edition

15. Financial Management Information Systems
Financial MIS: provides financial information to executives and others
Some financial MIS subsystems and outputs
Profit/loss and cost systems: profit and revenue centers
Auditing: internal and external
Uses and management of funds
Principles of Information Systems, Eighth Edition

16. Financial Management Information Systems (continued)
Figure 10.7: Overview of a Financial MIS
Principles of Information Systems, Eighth Edition

17. Manufacturing Management Information Systems
Manufacturing MIS subsystems and outputs monitor and control the flow of materials, products, and services through the organization
Design and engineering: CAD systems
Master production scheduling and inventory control
Methods: EOQ, MRP, JIT
Process control
Techniques: CAM, CIM, FMS
Quality control and testing
Principles of Information Systems, Eighth Edition

18. Manufacturing Management Information Systems (continued)
Figure 10.8: Overview of a Manufacturing MIS
Principles of Information Systems, Eighth Edition

19. Marketing Management Information Systems
Marketing MIS: supports managerial activities in product development, distribution, pricing decisions, and promotional effectiveness
Subsystems
Marketing research
Product development
Promotion and advertising
Product pricing
Sales analysis
Principles of Information Systems, Eighth Edition

20. Marketing Management Information Systems (continued)
Figure 10.9: Overview of a Marketing MIS
Principles of Information Systems, Eighth Edition

21. Marketing Management Information Systems (continued)
Figure 10.10: Reports Generated to Help Marketing Managers Make Good Decisions
Principles of Information Systems, Eighth Edition

22. Human Resource Management Information Systems
Human resource MIS: concerned with activities related to employees and potential employees
Subsystems
Human resource planning
Personnel selection and recruiting
Training and skills inventory
Scheduling and job placement
Wage and salary administration
Outplacement
Principles of Information Systems, Eighth Edition

23. Human Resource Management Information Systems (continued)
Figure 10.11: Overview of a Human Resource MIS
Principles of Information Systems, Eighth Edition

24. Other Management Information Systems
Accounting MIS: provides aggregate information on accounts payable, accounts receivable, payroll, and many other applications
Geographic information system (GIS): capable of assembling, storing, manipulating, and displaying geographic information
Principles of Information Systems, Eighth Edition

25. An Overview of Decision Support Systems
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.

26. An Overview of Decision Support Systems
DSS: organized collection of people, procedures, software, databases, and devices used to help make decisions that solve problems
Focus of a DSS is on decision-making effectiveness regarding unstructured or semistructured business problems
Used by managers at all levels
Principles of Information Systems, Eighth Edition

27. Characteristics of a Decision Support System
Provide rapid access to information
Handle large amounts of data from different sources
Provide report and presentation flexibility
Offer both textual and graphical orientation
Support drill-down analysis
Principles of Information Systems, Eighth Edition

28. Characteristics of a Decision Support System (continued)
Perform complex, sophisticated analysis and comparisons using advanced software packages
Support optimization, satisficing, and heuristic approaches
What-if analysis: making hypothetical changes to problem data and observing impact on results
Goal-seeking analysis: determining problem data required for a given result
Simulation: ability of the DSS to duplicate features of a real system
Principles of Information Systems, Eighth Edition

29. Characteristics of a Decision Support System (continued)
Figure 10.13: With a spreadsheet program, a manager can enter a goal, and the spreadsheet will determine the input needed to achieve the goal.
Principles of Information Systems, Eighth Edition

30. Capabilities of a Decision Support System
Support problem-solving phases
Support different decision frequencies
Ad hoc DSS
Institutional DSS
Support different problem structures
Highly structured problems
Semistructured or unstructured problems
Support various decision-making levels
Principles of Information Systems, Eighth Edition

31. Capabilities of a Decision Support System (continued)
Figure 10.14: Decision-Making Level
Principles of Information Systems, Eighth Edition

32. A Comparison of DSS and MIS
Table 10.3: Comparison of DSSs and MISs
Principles of Information Systems, Eighth Edition

33. A Comparison of DSS and MIS (continued)
Table 10.3: Comparison of DSSs and MISs (continued)
Principles of Information Systems, Eighth Edition

34. Components of a DSS
Decision support systems are composed of several interrelated parts.

35. Components of a Decision Support System
Database
Model base
Dialogue manager: user interface that allows decision makers to:
Easily access and manipulate the DSS
Use common business terms and phrases
Access to the Internet, networks, and other computer-based systems
Principles of Information Systems, Eighth Edition

36. Components of a Decision Support System (continued)
Figure 10.15: Conceptual Model of a DSS
Principles of Information Systems, Eighth Edition

37. Group Support Systems
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.

38. Principles of Information Systems, Eighth Edition
Group Support Systems
Group support system (GSS)
Consists of most elements in a DSS, plus software to provide effective support in group decision making
Also called group decision support system or computerized collaborative work system
Principles of Information Systems, Eighth Edition

39. Group Support Systems (continued)
Figure 10.16: Configuration of a GSS
Principles of Information Systems, Eighth Edition

40. Characteristics of a GSS That Enhance Decision Making
Special design
Ease of use
Flexibility
Decision-making support
Delphi approach
Brainstorming
Group consensus approach
Nominal group technique
Principles of Information Systems, Eighth Edition

41. Characteristics of a GSS That Enhance Decision Making (continued)
Anonymous input
Reduction of negative group behavior
Parallel communication
Automated record keeping
Principles of Information Systems, Eighth Edition

42. Principles of Information Systems, Eighth Edition
GSS Software
Often called groupware or workgroup software
Helps with joint work group scheduling, communication, and management
Examples
Virtual Office from Groove Networks
Lotus Notes
Office Communicator
IBM’s Workplace
Microsoft’s NetMeeting
Principles of Information Systems, Eighth Edition

43. GSS Software (continued)
Examples of groupware products available on the Web
WebEx, Genesys Meeting Center, GoToMeeting Corporate
GSS software incorporated into existing software packages
Principles of Information Systems, Eighth Edition

44. Principles of Information Systems, Eighth Edition
GSS Alternatives
Decision room
Decision makers are located in the same building or geographic area
Decision makers are occasional users of the GSS approach
Local area decision network
Group members are located in the same building or geographic area
Group decision making is frequent
Principles of Information Systems, Eighth Edition

45. GSS Alternatives (continued)
Figure 10.18: The GSS Decision Room
Principles of Information Systems, Eighth Edition

46. GSS Alternatives (continued)
Teleconferencing
Decision frequency is low
Location of group members is distant
Wide area decision network
Decision frequency is high
Principles of Information Systems, Eighth Edition

47. Executive Support Systems
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.

48. Executive Support Systems
Executive support system (ESS):
Specialized DSS
Includes hardware, software, data, procedures, and people used to assist senior-level executives
Also called an executive information system (EIS)
Principles of Information Systems, Eighth Edition

49. Executive Support Systems (continued)
Figure 10.19: The Layers of Executive Decision Making
Principles of Information Systems, Eighth Edition

50. Executive Support Systems in Perspective
Tailored to individual executives
Easy to use
Drill-down capabilities
Support need for external data
Principles of Information Systems, Eighth Edition

51. Executive Support Systems in Perspective (continued)
Can help with situations that have a high degree of uncertainty
Future-oriented
Linked to value-added business processes
Principles of Information Systems, Eighth Edition

52. Capabilities of Executive Support Systems
Support for defining overall vision
Support for strategic planning
Determining long-term objectives through analysis of current organization and prediction of future trends
Support for strategic organizing and staffing
Support for strategic control
Support for crisis management
Principles of Information Systems, Eighth Edition

53. Building management support systems
Challenges in building management support systems:
People:
It is difficult to find out exactly what kind of information managers really want and need.
Different levels of computer literacy affect how the management support systems are built.
Organizational:
The cost of building the systems may not justify the benefits, especially when the benefits are intangible.
A significant amount of organizational change may be required before the management support systems can be built.

54. Building management support systems
Technology:
Compatibility must be established with existing systems in the business
Technology often becomes obsolete.

55. Questions (?)