What is the role of DSS?

1
What is the role of DSS?

• Help people make decisions? OR
• Make decisions for people?

2
What Is a Decision?

• A decision is a reasoned choice among
  alternatives.
• Decision- making criteria are what we want to
  optimize in a decision.

3
Decision Statement
Environment
Join
Alternatives
Criteria
Selection Process
4
ExampleChoosing semester
courses

• Which Decision Statement is better?
• 1. Register for next semester.
• 2. Choose courses for next semester.
• 3. What courses to register for next
  semester?
• 4. Can we register for next semester?

5
Environment
Learning output H. W Load Schedule Suitability
Course 1 9 7 9
Course 2 10 8 7
Course 3 6 7 8
Course 4 8 4 10
Course 5 9 9 4
Course 6 6 2 10
6
Criteria ( Objectives)

• In the range 0-1, we rate our preference for
  the environmental inputs

Learning 0.9
Work load 0.5
Schedule 0.7
7
The Decision Process

• Every decision must go through the three phases
• Phases are
• Intelligence Statement Environment
• Design set up Alternatives using
  Intelligence
• Choice Criteria Alternatives.

8
Categories of Decisions

• Two decisions dimensions
• the nature of decisions
• the scope of the decision
• Three decision categories
• structured decision
• unstructured decision
• semi-structured decision
• Three decision scopes
• strategic decision
• tactical decision
• operational decision

9
How do Business People Make Decisions?

• The many methods by which business people make
  decisions can be categorized along three
  dimensions
• Rationality depends on quantifiable
• measures( buying a car)
• Politicality quantitative qualitative
• ( choosing an elective
  course)
• Flexibility qualitative measures( choosing an
  ice-cream retail location).

10

• Decision making approaches

Descriptive 80 Flexibility 20 Politicality
Normative 80 Rationality 20 Politicality
11
The Rational Manager

• Normative model of decision making.
• Uses probability in making choices
• ?P(i). Cost(i) FOR EACH ALTERNATIVE
• Figure 2-6 ( P 49).

12
Subjective Utility

• Uses human rationality in making decisions.
• For example decision might depends on the
  risk rate.
• gt Uses Fixed Cost Utility Curves ( Figure 2-8).
• gt Uses Variable Cost Utility Curves( Figure
  2-9).

13
The Rational Manager (contd)

• Systematic decision making
• ? W(i). Cost(i) FOR EACH CRITERIA
• gt Look at the course selection example

14
Organizational and Political Decision Making

• Viewing decision making as an organizational
  process combines rationality with politicality.

15
The Impact of Culture on Decision Making

• Culture can be defined as the behaviors and
  beliefs characteristics of a particular group.
• Two aspects of culture influence decision making
  organizational(corporate) culture and national
  culture.

16
The Kepner-Tregoe Decision-making Method

• The K-T method is best suited to decision makers
  with a thinking preference.
• 1. State Objectives.
• 2. Set priority( weight) for each objective.
• 3. Set Alternatives.
• 4. Evaluate alternatives against objectives.
• See example Page 72.
• Use ExpertChoice software.

17
Conclusion

• A decision is a choice among alternatives
• Decision makers go through intelligence, design
  and choice phases
• Managers make decisions with varying degree of
  rationality, politicality and flexibility