Chapter 8: Information, Decision Support, Artificial Intelligence, and SpecialPurpose Systems

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Chapter 8 Information, Decision Support,
Artificial Intelligence, and Special-Purpose
Systems

• Succeeding with Technology Computer System
  Concepts for Real Life

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Objectives

• Define the stages of decision making and problem
  solving
• Discuss the use of management information systems
  in providing reports to help solve structured
  problems
• Describe how decision support systems are used to
  solve nonprogrammed and unstructured problems
• Explain how a group decision support system can
  help people and organizations collaborate on team
  projects
• Discuss the uses of artificial intelligence and
  special-purpose systems

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Decision Making and Problem Solving

• Decision making process takes place in three
  stages
• Intelligence
• Design
• Choice
• Problem solving includes and goes beyond
  decision making
• Implementation stage
• Monitoring stage
• Reactive versus Proactive approach

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Business Intelligence Applications

• Analytical and decision support tools

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Level of Management Decision Making

• Strategic Management (Long Range)
• Board of Directors
• Executive Committee
• Tactical Management (Medium Short Range)
• Business unit managers
• Operational Management (Short Term)

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Information Quality

• Information products whose characteristics,
  attributes, or qualities make the information
  more value

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Decision Making and Problem Solving

• Structured situations where the procedures to
  follow when a decision is needed can be specified
  in advance
• Unstructured decision situations where it is
  not possible to specify in advance most of the
  decision procedures to follow
• Semistructured - decision procedures that can be
  prespecified, but not enough to lead to a
  definite recommended decision
• Optimization model
• Heuristics (rules of thumb)
• Commonly accepted guidelines

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Information Systems to Support Decisions
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Management Information System

• Produces prespecified reports, displays and
  responses that support many of structured the
  day-to-day decision-making needs of managers and
  business professionals
• Inputs
• Data can originate from internal or external
  sources
• TPS
• Databases
• Outputs
• Scheduled reports
• Key-indicator report
• Demand reports
• Exception reports

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Decision Support Systems

• Provide interactive computer-based modeling
  using Analytical models Specialized databases
  A decision makers own insights and judgments to
  managers and business professionals during the
  decision-making process to support semistructured
  business decisions

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Decision Support Systems Components
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Using DSS

• What-if Analysis - End user makes changes to
  variables, or relationships among variables, and
  observes the resulting changes in the values of
  other variables
• Sensitivity Analysis - Value of only one
  variable is changed repeatedly and the resulting
  changes in other variables are observed
• Goal-Seeking - Set a target value for a variable
  and then repeatedly change other variables until
  the target value is achieved
• Optimization - Goal is to find the optimum value
  for one or more target variables given certain
  constraints by repeatedly changing until the best
  values for the target variables are discovered

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On-Line Analytic Processing

• OLAP - Enables mangers and analysts to
  interactively examine and manipulate large
  amounts of detailed and consolidated data from
  many perspectives
• Consolidation - Aggregation of data
• Drill-down - Display detail data that comprise
  consolidated data
• Slicing and Dicing - Ability to look at the
  database from different viewpoints

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OLAP Technology
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The Group Decision Support System

• Group decision support system (GDSS)
• Hardware, software, people, databases, and
  procedures
• Characteristics of a GDSS
• Special Design
• Ease of Use
• Flexibility
• Anonymous Input
• Reduction of Negative Group Behavior
• Support of Positive Group Behavior
• Delphi approach
• Brainstorming
• Group consensus approach
• Nominal group technique (NGT)

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Artificial Intelligence

• A field of science and technology based on
  disciplines such as computer science, biology,
  psychology, linguistics, mathematics, and
  engineering
• Think and reason
• Use reason to solve problems
• Learn or understand from experience
• Acquire and apply knowledge
• Exhibit creativity and imagination
• Deal with complex or perplexing situations
• Respond quickly and successfully to new
  situations
• Recognize the relative importance of elements in
  a situation
• Handle ambiguous, incomplete, or erroneous
  information

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Artificial Intelligence
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Expert Systems

• A knowledge-based information system (KBIS) that
  uses its knowledge about a specific, complex
  application to act as an expert consultant to end
  users

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Summary

• Three phases of decision making
• Intelligence, design, and choice
• Problem solving
• Takes decision making a step further
• Implements the choice
• Monitors the effects of the decision
• MIS
• Provide managers with insight into the regular
  operations of the organization
• Output
• Scheduled reports, demand reports, and exception
  reports

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Summary (Continued)

• Decision support systems
• Can handle large amount of data
• Can obtain and process data from different
  sources
• Can provide report and presentation flexibility
• Group decision support system (GDSS)
• A computerized collaborative work system
• Artificial intelligence (AI) includes
• Robotics
• Learning systems
• Neural networks