Enterprise Decision

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CHAPTER 8

• Enterprise Decision
• Support Systems

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Enterprise Decision Support Systems

• DSS to provide enterprise-wide support
• Executives
• Many decision makers in different locations
• Enterprise Resource Planning (ERP) systems

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8.2 Enterprise Systems Concepts and Definitions

• Executive information systems (EIS)
• Executive support systems (ESS)
• Enterprise information systems (EIS)

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8.3 Evolution of Executive and Enterprise
Information Systems

• DSS and ODSS
• 1980s Top execs get Executive Information
  Systems
• 1995s Move to everybodys information systems
  and enterprise information systems
• Definitions follow

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Executive Information System (EIS)

• A computer-based system that serves the
  information needs of top executives
• Provides rapid access to timely information and
  direct access to management reports
• Very user-friendly, supported by graphics
• Provides exceptions reporting and "drill-down"
  capabilities
• Easily connected to the Internet
• Drill down

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Executive Support System (ESS)

• Comprehensive support system that goes beyond EIS
  to include
• Communications
• Office automation
• Analysis support
• Intelligence

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Enterprise Information System

• Corporate-wide system
• Provides holistic information
• From a corporate view
• Part of enterprise resource planning (ERP)
  systems
• For business intelligence
• Leading up to enterprise information portals and
  knowledge management systems

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8.4 Executives Role and Their Information Needs

• Decisional Executive Role (2 Phases)
• 1. Identification of problems and/or
  opportunities
• 2. The decision of what to do about them
• Flow chart and information flow (Figure 8.1)
• Use phases to determine executives information
  needs

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The decision-making process of executives
(decision role)
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Methods for Finding Information Needs

• Wetherbe's Approach
• 1. Structured Interviews
• IBM's Business System Planning (BSP)
• Critical Success Factors (CSF)
• Ends/Means (E/M) Analysis
• 2. Prototyping
• Watson and Frolick's Approach
• Asking (interview approach)
• Deriving the needs from an existing information
  system
• Synthesis from characteristics of the systems
• Discovering (Prototyping)
• Ten methods
• Other Methods

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8.5 Characteristics of EIS

• Drill down
• Critical success Factors (CSF)
• Status access
• Analysis
• Exception reporting
• Colors and audio
• Navigation of information
• Communication

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Critical Success Factors (CSF)

• Monitored by five types of information
• 1. Key problem narratives
• 2. Highlight charts
• 3. Top-level financials
• 4. Key factors (key performance indicators (KPI))
• 5. Detailed KPI responsibility reports

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Characteristics and Benefits of EIS (Table 8.1)

• Quality of information
• User interface
• Technical capability provided
• Benefits

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8.6 Comparing and Integrating EIS and DSS

• Tables 8.2 and 8.3 compare the two systems
• Table 8.2 - DSS definitions related to EIS
• Table 8.3 - Comparison of EIS and DSS
• EIS is part of decision support

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Definitions of DSS as They Relate to EIS
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Comparison of EIS and DSS
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Integrating EIS and Group Support Systems

• EIS vendors - easy interfaces with GSS
• Some EIS built in Lotus Domino / Notes
• Comshare Inc. and Pilot Software, Inc. - Lotus
  Domino/Notes-based enhancements and
  Web/Internet/Intranet links

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Traditional EIS Software

• Major Commercial EIS Software Vendors
• Comshare Inc. (www.comshare.com)
• Pilot Software Inc. (www.pilotsw.com)
• Application Development Tools
• In-house components
• Comshare Commander tools
• Pilot Softwares Command Center Plus and Pilot
  Decision Support Suite

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• 8.7
• EIS
• Data access
• Data warehousing
• OLAP
• Multidimensional analysis
• Presentations
• Web

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Multidimensional Analysis

• Easy to develop an EIS in an OLAP system
• Most are Web-ready
• Can tap into data in a data warehouse via the Web
• Use advanced visualization tools

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Representative OLAP / Multidimensional Analysis
Packages

• BrioQuery (Brio Technology Inc.)
• Business Objects (Business Objects Inc.)
• Decision Web (Comshare Inc.)
• DataFountain (Dimensional Insight Inc.)
• DSS Web (MicroStrategy Inc.)
• Focus Fusion (Information Builders Inc.)
• InfoBeacon Web (Platinum Technology Inc.)
• Oracle xpress Server (Oracle Corporation)
• Pilot Internet Publisher (Pilot Software Inc.)

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8.8 Including Soft Information in EIS

• Soft information is fuzzy, unofficial, intuitive,
  subjective, nebulous, implied, and vague

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Soft Information Used in Most EIS

• Predictions, speculations, forecasts, estimates
  (78.1)
• Explanations, justifications, assessments,
  interpretations (65.6)
• News reports, industry trends, external survey
  data (62.5)
• Schedules, formal plans (50.0)
• Opinions, feelings, ideas (15.6)
• Rumors, gossip, hearsay (9.4)
• Soft Information Enhances EIS Value

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8.9 Organizational DSS (ODSS)

• Three Types of Decision Support
• Individual
• Group
• Organizational
• Hackathorn and Keen (1981)

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• Organizational decision support focuses on an
  organizational task or activity involving a
  sequence of operations and actors
• Each individual's activities must mesh closely
  with other people's work
• Computer support is for
• Improving communication and coordination
• Problem solving

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Definitions of ODSS

• A combination of computer and communication
  technology designed to coordinate and disseminate
  decision-making across functional areas and
  hierarchical layers in order that decisions are
  congruent with organizational goals and
  management's shared interpretation of the
  competitive environment (R. T. Watson, 1990)
• A DSS that is used by individuals or groups at
  several workstations in more than one
  organizational unit who make varied (interrelated
  but autonomous) decisions using a common set of
  tools (Carter et al., 1992)

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• A distributed decision support system (DDSS). Not
  a manager's DSS, but supports the organization's
  division of labor in decision making (Swanson and
  Zmud, 1990)
• Apply the technologies of computers and
  communications to enhance the organizational
  decision-making process. Vision of technological
  support for group processes to the higher level
  of organizations (King and Star, 1990)

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Common Characteristics of ODSS (George, 1991)

• Focus is on an organizational task or activity or
  a decision that affects several organizational
  units or corporate problems
• Cuts across organizational functions or
  hierarchical layers
• Almost always involves computer-based
  technologies, and may involve communication
  technologies
• Can Integrate ODSS with Group DSS and Executive
  Information Systems
• ODSS are an enterprise information system
  directly concerned with decision support

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8.10 Supply and Value Chains and Decision Support

• Supply chain (originally) flow of materials from
  sources to internal use
• Demand chain flow from inside to customers

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Supply Chain

• The flow of materials, information, and services
  from raw material suppliers through factories and
  warehouses to the end customers
• Includes the organizations and processes that
  create and deliver value to the end customers

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Supply Chain Management (SCM)

• To deliver an effective supply chain and do it
  effectively
• To plan, organize, and coordinate the supply
  chains activities

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SCM Benefits

• Reduction in uncertainty and risks in the supply
  chain
• Positively affect
• inventory levels
• cycle time
• processes
• customer service
• Increase profitability

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Supply Chain Components

• Upstream
• Internal supply chain
• Downstream
• Involves product life cycle activities
• Example (Figure 8.2)

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Supply chains of wine marking
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An automotive supply chain
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Supply Chain

• Related to the Value Chain Model (Porter)

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8.11 Supply Chain Problems

• Uncertainty in the demand forecast
• Uncertainty in delivery times
• Quality problems
• Poor customer service
• High inventory costs
• Low revenue
• Extra costs

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Solutions to Supply Chain Problems

• Outsourcing
• Buy, not make
• Configure optimal shipping plans
• Optimize purchasing
• Strategic partnerships with suppliers
• Just-in-time delivery of purchases
• Reduce intermediaries
• Reduce lead times (EDI)
• Use fewer suppliers
• Improve the supplier-buyer relationships
• Build-to-order
• Accurate demand by working with suppliers

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8.12 Computerized Systems

• MRP
• ERP
• SCM
• Integrating the supply chain

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Enterprise Resource Planning (ERP)

• Objective integrate all departments and
  functions across an organization into a single
  computer system that can serve the entire
  enterprises needs

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ERP Software Vendors

• SAP
• Baan
• PeopleSoft
• Oracle
• J.D. Edwards
• Computer Associates

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ERP

• Very (VERY!) expensive
• 2nd generation doing better
• Early 2000 moving to Web
• Will fail if an organizations business processes
  do not fit the ERP systems model

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Application Service Providers and ERP Outsourcing

• ASP software vendor who leases ERP-based
  applications
• Outsourcing
• Now via the Web

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Corporate (Enterprise) Portals and EIS

• Integrates internal applications with external
  applications
• Generally via the Web
• Can include
• groupware technologies
• presentation and customization
• publishing and distribution
• search
• categorization
• integration

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8.13 Frontline Decision Support Systems

• Process of automating decision processes and
  pushing them down into the organization and even
  partners
• Includes empowering employees

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8.14 Future of Executive and Enterprise Support
Systems

• Toolbox for customized systems
• Multimedia support
• Better access (via PDFs and cell phones)
• Virtual Reality and 3-D Image Displays
• Merging of analytical systems (OLAP /
  multidimensional analysis)) with desktop
  publishing
• Client/server architecture
• Web-enabled EIS
• Automated support and intelligent assistance
• Integration of EIS and Group Support Systems
• Global EIS
• Integration and deployment with ERP products