Presentation on theme: "Business Intelligence Systems (Decision Support Systems)"— Presentation transcript:
1 Business Intelligence Systems (Decision Support Systems) Chapter 5Business Intelligence Systems(Decision Support Systems)
2 Agenda Business Intelligence (BI) Types of data History of BIEvolution of BIArchitecture of BIBenefits of BITypes of dataStructuredSemi-StructuredUnstructuredDecision Support Systems (DSS)DefinitionCharacteristics and capabilities of DSSDSS Components
3 Business Intelligence (BI) BI is an umbrella term that combines architectures, tools, databases, analytical tools, applications, and methodologiesBI's major objective is to enable easy access to data (and models) to provide business managers with the ability to conduct analysisBI helps transform data, to information (and knowledge), to decisions and finally to action
5 Components in a BI Architecture The data warehouse is a large repository of well-organized historical dataBusiness analytics are the tools that allow transformation of data into information and knowledgeBusiness performance management (BPM) allows monitoring, measuring, and comparing key performance indicatorsUser interface (e.g., dashboards) allows access and easy manipulation of other BI components
7 Faster, more accurate reporting Improved decision making The Benefits of BIThe ability to provide accurate information when needed, including a real-time view of the corporate performance and its parts.Faster, more accurate reportingImproved decision makingImproved customer serviceIncreased revenue
8 The DSS–BI Connection (1) First, their architectures are very similar because BI evolved from DSSSecond, DSS directly support specific decision making, while BI provides accurate and timely information, and indirectly support decision makingThird, BI has an executive and strategy orientation, especially in its BPM and dashboard components, while DSS, in contrast, is oriented toward analysts
9 The DSS–BI Connection (2) Fourth, most BI systems are constructed with commercially available tools and components, while DSS is often built from scratchFifth, DSS methodologies and even some tools were developed mostly in the academic world, while BI methodologies and tools were developed mostly by software companiesSixth, many of the tools that BI uses are also considered DSS tools (e.g., data mining and predictive analysis are core tools in both)
10 The DSS–BI Connection (3) Although some people equate DSS with BI, these systems are not, at present, the sameSome people believe that DSS is a part of BI—one of its analytical toolsOthers think that BI is a special case of DSS that deals mostly with reporting, communication, and collaboration (a form of data-oriented DSS)BI is a result of a continuous revolution and, as such, DSS is one of BI's original elementsManagement Support SystemsMSS = BI and/or DSS
11 What is Business Intelligence (BI)? Business intelligence is an umbrella term that refers to competencies, processes, technologies, applications and practices used to support evidence-based decision making in organizations.In the widest sense it can be defined as a collection of approaches for gathering, storing, analyzing and providing access to data that helps users to gain insights and make better fact-based business decisions.
12 What is BI used for?Analyzing customer behaviors, buying patterns and sales trends.Measuring, tracking and predicting sales and financial performanceBudgeting and financial planning and forecastingTracking the performance of marketing campaignsOptimizing processes and operational performanceImproving delivery and supply chain effectivenessWeb and e-commerce analyticsCustomer relationship managementRisk analysisStrategic value driver analysis
14 Gathering DataCollecting or accessing data that can be used to inform decision making.It can come in many formats and basically refers to the automated measurement and collection of performance data.Relevant data should be collected in the right way at the right time.Uncontrolled data can jeopardize the entire BI efforts that might follow.
15 Storing DataData is filed and stored in appropriate ways to ensure it can be found and used for analysis and reporting.Data can be stored under different categories; also called data marts or data-warehouse access layers.Good data storage starts with the needs and requirements of the end users and a clear understanding of what they want to use the data for.
16 Analyzing DataInspect, transform or model data in order to gain new insights that will support our business decision making.Data analysis comes in many different formats and approaches, both quantitative and qualitative.Analysis techniques includes the use of statistical tools, data mining approaches as well as visual analytics or even analysis of unstructured data such as text or pictures.
17 Providing AccessAccess to data is needed to perform analysis or to view the results of the analysis.Software tools allow end-users to perform data analysisData are provided through reporting, dashboard (control panel) and scorecard (note, card, memo) applications.
19 Becoming an ‘Intelligent Company’ Step 1: More intelligent strategies – by identifying strategic priorities and agreeing your real information needs.Step 2: More intelligent data – by creating relevant and meaningful performance indicators as well as qualitative management information linked back to your strategic information needs.Step 3: More intelligent insights – by using good evidence to test and prove ideas and by analyzing the data to gain robust and reliable insights.Step 4: More intelligent communication – by creating informative and engaging management information packs and dashboards that provide the essential information, packaged in a way that is targeted and easy-to-understand.Step 5: More intelligent decision making – by fostering an evidence- based culture of turning information into actionable knowledge and real decisions.
20 Types of Data Structured Semi-Structured Unstructured Both inputs and outputs are clearSemi-StructuredEither inputs or outputs are unclearUnstructuredBoth inputs and outputs are unclear
22 A Decision Support Framework (2) Degree of Structuredness (Simon, 1977)Decisions are classified asHighly structured (a.k.a. programmed)Semi-structuredHighly unstructured (i.e., non-programmed)Types of Control (Anthony, 1965)Strategic planning (top-level, long-range)Management control (tactical planning)Operational control
24 How Decisions Are Supported Artificial Neural Networks (ANN)Management Information Systems (MIS)Online Analytical Processing (OLAP)Expert Systems (ES)Enterprise Resource Planning (ERP)(ESS)Software Configuration Management (SCM) is the task of tracking and controlling changes in the software, part of the larger cross-discipline field of configuration managementCustomer Relationship Management (CRM) is a system for managing a company’s interactions with current and future customers. It often involves using technology to organize, automate and synchronize sales, marketing, customer service, and technical support.Knowledge Valuation System (KVS)Knowledge Managmement System (KMS)
25 Classical Definitions of DSS Interactive computer-based systems, which help decision makers utilize data and models to solve unstructured problems"- Gorry and Scott-Morton, 1971It is a computer-based support system for management decision makers who deal with semi-structured problems- Keen and Scott-Morton, 1978
26 DSS as an Umbrella TermThe term DSS can be used as an umbrella term to describe any computerized system that supports decision making in an organizationE.g., an organization wide knowledge management system; a decision support system specific to an organizational function (marketing, finance, accounting, manufacturing, planning, SCM, etc.)
28 Decision Support Systems (1) Systems designed to support managerial decision-making in unstructured problemsMore recently, emphasis has shifted to inputs from outputsMechanism for interaction between user and componentsUsually built to support solution or evaluate opportunities
29 Decision Support Systems (2) A DSS is a methodology that supports decision-making.It is:FlexibleAdaptiveInteractiveGUI-basedIterativeEmploys modeling.
31 Characteristics and Capabilities of DSS (1) Provide support in semi-structured and unstructured situations, includes human judgment and computerized informationSupport for various managerial levelsSupport to individuals and groupsSupport to interdependent and/or sequential decisionsSupport all phases of the decision-making processSupport a variety of decision-making processes and styles(more)
32 Characteristics and Capabilities of DSS (2) Are adaptiveHave user friendly interfacesGoal: improve effectiveness of decision makingThe decision maker controls the decision-making processEnd-users can build simple systemsUtilizes models for analysisProvides access to a variety of data sources, formats, and typesDecision makers can make better, more consistent decisions in a timely manner
33 Components of DSSSubsystems:Data managementManaged by DBMSModel managementUser interfaceKnowledge Management and organizational knowledge base
34 Data Management Subsystem Components:DatabaseDatabase management systemData directoryQuery facility
35 DatabaseInterrelated data extracted from various sources, stored for use by the organization, and queriedInternal data, usually from TPSExternal data from government agencies, trade associations, market research firms, forecasting firmsPrivate data or guidelines used by decision-makers
36 Database Management System Extracts dataManages data and their relationshipsUpdates (add, delete, edit, change)Retrieves data (accesses it)Queries and manipulates dataEmploys data dictionary
37 What are the major functions (capabilities) of DBMS? Storage, retrieval, and control are the three basic functions.The DBMS manages the database: organize, extract/access, modify, delete, and catalogue data.
38 Data Directory Catalog of all data Contains data definitions Answers questions about the availability of data itemsSourceAllows for additions, removals, and alterations
39 Data DirectoryExtraction: is to capture data from several sources, filter them, summarize, condense, and reorganize the data. The function of a query facility is to provide the basis for access to data. Accepts requests, checks for feasibility, provides answers.The function of a directory is a catalog of all data in the database. It includes data definitions.
40 Model Management Subsystem Components:Model baseModel base management systemModeling languageModel execution, integration, and command processor
41 Models Strategic models Support top management's strategic planning. For example, examination of acquisitions, diversifications, and mergers.Tactical modelsSupport mainly middle management in resource allocation and in control. For example, make or buy decisions or devising a major promotion plan.
42 Types of Models Operational Supports daily activities Analytical Used to perform analysis of data
43 Model Base Management System Functions:Model creationModel updatesModel data manipulationModel directory:Catalog of modelsDefinitions
44 Model Management Activities Model executionControls running of modelModel command processorReceives model instructions from user interfaceRoutes instructions to MBMS or module execution or integration functionsModel integrationCombines several models’ operations
45 User Interface System Knowledge-based system Data management and DBMS Model management and MBMSUser Interface Management System (UIMS)Natural Language ProcessorInputActionLanguagesOutputDisplayLanguageUsersPrinters, PlottersPC Display
46 User Interface Management System GUINatural language processorInteracts with model management and data management subsystemsExamplesSpeech recognitionDisplay panel
47 User Interface Management System A user interface covers all aspects of the communications between a user and the MSS.Most of the power, flexibility, and ease-of-use characteristic of MSS are derived from this component.It is the part of the system that the user sees, to him/her, it is the system.
48 Knowledge-Based Management System Expert or intelligent agent system componentComplex problem solvingEnhances operations of other components
49 DSS Hardware De facto standard Web server with DBMS: Operates using browserData stored in variety of databasesCan be mainframe, server, workstation, or PCAny network typeAccess for mobile devices
50 Holsapple and Whinston DSS ClassificationsAlterExtent to which outputs can directly support or determine the decisionData oriented or model orientedHolsapple and WhinstonText oriented, database oriented, spreadsheet oriented, solver oriented, rule oriented, or compound
51 DSS Classifications Intelligent Descriptive Procedural Reasoning LinguisticExpert-system basedAdaptiveHackathorn and KeenPersonal support, group support, or organizational support
52 Custom made vs. vendor ready made DSS ClassificationsGSS v. Individual DSSDecisions made by entire group or by alone decision makerCustom made vs. vendor ready madeGeneric DSS may be modified for useDatabase, models, interface, support are built inAddresses repeatable industry problemsReduces costs
53 List the major components of DSS and briefly define each of them. DSS ComponentsList the major components of DSS and briefly define each of them.The major components are:Data management; includes a database and its management system.Model management; includes models and their management system.Knowledge base; includes artificial intelligence enhancements to the other components.The user; he or she is the decision maker.
54 DSS Users (1) List and describe the major classes of DSS users. The major classes of DSS users are:Management (user, decision-maker) - looking for more user-friendly systems that can do more general analysis and aid in decision making.Staff (intermediaries) - are looking for more detailed- oriented system and are willing to use more complex system. Staff acts as intermediary between MSS and manager. Different intermediaries:Staff assistants have specialized knowledge about management problems and some experience with the decision support technology.
55 DSS Users (2)An expert tool user is skilled in the application of one or more types of specialized problem- solving tools. The expert tool user performs the tasks the problem solver does not have the technical skills to do.Business (system) analysts have a general knowledge of the application area, a formal business administration education, and considerable skill in DSS construction tools.Facilitator in GSS controls and coordinates the software of group DSS.
56 What types of support are provided by DSS? DSS provides: DSS SupportWhat types of support are provided by DSS?DSS provides:Support in semistructured and unstructured situationsSupport by bringing human judgment and computerized information together.Support for various managerial levels, ranging from top executives to line managers.
57 DSS SupportSupport to individuals as well as groups, since less structured problems sometimes require several individuals from different departments and organizational levels.Support to several interdependent and or sequential decisions.Support in all phases of the decision-making process: intelligence, design, choice, and implementation.