MIS, DSS,

1
MIS, DSS, ESS

• Purpose,
• Definition,
• and
• Concepts

2
Business decisions are

• Programmed decisions
• Structured situations with well defined
  relationships
• Quantifiable
• Management information system (MIS)
• Easy to computerize
• Non-programmed decisions
• Rules and relationships not defined
• Problem is not routine
• Not easily quantifiable
• DSS, GDSS, ESS

3
How do we solve these kinds of business problems?

• Optimize them find the best solution
• Satisfice them find a good enough solution
• Use heuristics on them rules of thumb

4
Reporting in an MIS

• Structured situations structured decisions
  structured reports
• Fixed format, standard reports
• Hard-copy or soft-copy reports
• Uses internal data
• User-developed reports
• Users must request formal reports from
• IS department

5
Detail level of an MIS report drill downs
6
Description of DSS GDSS

• TIME FRAME
• UNSTRUCTURED PROBLEMS WHERE THE NEED IS FOR THE
  COMBINED PROCESSING OF DATA AND MANAGERIAL
  JUDGEMENT
• COMPLICATED PROBLEMS WITH MISSING OR UNCERTAIN
  DATA SOURCES WITH UNKNOWN VARIABLE
  RELATIONSHIPS
• PRINCIPLE OF SATISFICING

7
DEFINITION OF A DSS OR GDSS

• AN INTERACTIVE, FLEXIBLE COMPUTER BASED SYSTEM,
  CONSISTING OF RULES, MODELS, DATA, AND A USER
  FRIENDLY INTERFACE, COUPLED WITH THE USER'S OWN
  INSIGHTS AND VALUE STRUCTURE.

8
Payoffs from DSS

• EXPANDS MANAGERIAL POWER EFFECTIVENESS
• BREADTH OF UNDERSTANDING OF THE PROBLEM
• FLEXIBILITY IN ANALYSIS
• USER FRIENDLY SYSTEMS

9
Relevance of DSS to managers

• DECISIONS MADE BY MANAGERS NOT BY MACHINES
• CAN USE QUANT MODELS TO ESTABLISH DECISION
  BOUNDARY
• BLEND OF HUMAN JUDGMENT AND STRUCTURE
• DSS IS USED TO SUPPORT SPECIFIC DECISIONS
• SOLUTIONS NOT IMPOSED (TWO DIRECTIONAL SEARCH)
• SEARCH IS FOR BEST PROCESS AND EFFECTIVE SOLUTION
  ( NOT FOR AN OPTIMUM!)

10
Applications

• LONG RANGE PLANNING
• WORK FORCE ALLOCATION
• LONG RANGE STAFFING
• ESTIMATING MATERIAL NEEDS
• INDUSTRIAL HAZARD ASSESSMENT
• ASSESSMENT OF THE NEED FOR INTELLIGENCE
• BUDGETING
• RESOURCE EXPLORATION PLANNING
• WAREHOUSE DISTRIBUTION AND STOCKING
• PATIENT BED OPERATING ROOM ASSIGNMENT
• ASSESSMENT OF THE IMPACT OF MARKET RESPONSE ON
  OPERATIONS OF THE FIRM

11
Examples applications of DSS

• A home loan calculator
• http//www.eaussie.com.au/
• An auto loan calculator
• http//www.bankrate.com/brm/rate/auto_home.asp
• Human resources management with salary
  administration
• Salaries model using Excel
• Evaluating non-quantifiable alternatives
• Alternatives evaluation model using Excel

12
OUTCOMES OF USING A DSS

• A set of implementable decisions, which solve
  problems that are not suited for operations
  research, transaction processing or MIS.
• A DSS supports the solutions of complex problems
  through the use of simplified models
  user-friendly systems

13
Components of a DSS
14
Whats in a model base?

• Financial models
• Cash flow
• Internal rate of return
• Economic models
• Market models
• Regional demand
• Inventories
• Forecasting models

• Statistical analysis models
• Summary statistics
• Trend projections
• Hypothesis testing
• Graphical models
• Project management models

15
GDSS and the decision room
-Special design -Ease of use -Flexibility -Decisio
n-making support -Anonymous input -Reduction of
negative group behavior -Automated record
keeping -Ease of communication -Delphi and
NGT
16
INFORMATION SOURCES FOR A DSS or GDSS

• EXTERNAL
• SOURCES
• INTERNAL
• SOURCES

17
REASONS FOR USING DECISION SUPPORT SYSTEMS

• Unstable environment
• Competition
• Difficulty in Tracking the Firm and the Market
• Lack of I/S Support
• Diverse, Individual Needs

18
Why use a DSS or GDSS what the users say?

• FACTORS CITED BY
  
• ACCURATE INFORMATION 67
• DSS VIEWED AS WINNER 44
• NEED FOR NEW INFORMATION 33
• MANAGEMENT WANTS DSS 22
• TIMELY RESULTS BY DSS 17
• COST OF INFO. REDUCED 6
• (survey results)

19
Executive Support Systems (ESS)

• Tailored to individual executives
• Easy to use
• Drill down capabilities
• Support need available for external data
• Can help when uncertainty is high
• Future-oriented
• Graphical output
• Costly

20
Relationship of TPS, MIS, DSS, ESS, ES
21
INFORMATION SYSTEMS USE BY MANAGEMENT LEVEL

• 
  INFORMATION SYSTEMS
• LEVEL MIS DSS
  ES TPS
• _______________________________________________
• STRATEGIC y
  y y
• TACTICAL y
  y
• OPERATING y y
  ?y
• STAFF/MFG.
  y
• _______________________________________________

22
..end MIS, DSS, ESS concepts, definitions, and
their purpose