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Chapter 11

Instructors Manual

Chapter 11
Decision Support Systems
Teaching Objectives

Ensure that students know the fundamentals of decision making and problem solving.
Acquaint students with the fundamentals of mathematical modeling.
Recognize the electronic spreadsheet as an effective vehicle for mathematical modeling.
Introduce students to artificial intelligence and how it is incorporated into expert systems.
Describe how the DSS concept has been applied to group problem solving, producing the GDSS
(group decision support system).

Teaching Tips

Devote class time to explaining how a systems view accomplishes the five objectives on page 252.
Devote class time to explaining the relationship between structured/unstructured problems and
programmed/nonprogrammed decisions.
Assign the Gorry and Scott Morton article as a reading assignment.
Use Figure 11.3 as a roadmap to keep the discussion on line as you proceed from one DSS topic to
another in the chapter.
Walk the students through the mathematical model in Figure 11.5, distinguishing between scenario
and decision data, and explaining how orders are placed and received.
Assign the students the task of preparing Excel spreadsheets for the model in Figure 11.11 or 11.12
and playing the what-if game, using parameters that you provide.
Invite someone from a firm that has implemented an expert system to tell the class of her or his
experiences.
Invite a facilitator to visit the class and conduct a group problem solving activity, such as an
electronic meeting system.

Answers To Questions
1. Simon's four stages of problem-solving activity include intelligence, design, choice, and review.
2. You use the general systems model of the firm and the eight-element environmental model in applying the
systems approach.
3. Both internal and environmental constraints take the form of resource restrictions.
4. Mintzberg recognizes three approaches to identifying the best alternative solution: analysis, judgment,
and bargaining.
5. The term problem structure refers to the ability of the problem solver to know the elements that compose
a problem and to know how the elements are interrelated.
6. Gorry and Scott Morton were motivated by a need to overcome the difficulty of an MIS focusing on
specific problems because of its overwhelming responsibility to address problems of all kinds.
7. Gorry and Scott Morton used the DSS term to describe computer applications that had not been
implemented in the early 1970s.
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8. Figure 11.3 shows the different DSS outputs: periodic and special reports, outputs from mathematical
models, outputs from groupware, solutions and explanations provided by expert systems, and OLAP
outputs from a multidimensional database management system.
9. The four basic model types are physical, narrative, graphic, and mathematical.
10. All models facilitate understanding and communication.
11. Mathematical models can be static/dynamic, probabilistic/deterministic, and optimizing/suboptimizing.
12. You enter scenario and decision data into a mathematical model
13. The manager manipulates decision data when playing the what-if game.
14. The electronic spreadsheet minimized the requirement for a high degree of mathematical skill to develop
mathematical models
15. In a dynamic model the spreadsheet columns are used for time periods.
16. An expert system consists of the user interface, a knowledge base, an inference engine, and a
development engine.
17. The goal variable is the problem solution that is sought by an expert system, which can exist in the form
of a value to be assigned to a variable (such as gross sales revenue) or a decision (such as to produce the
product).
18. A synchronous exchange is one where both the sender and the receiver of the message are actively
participating at the same time--such as in a telephone call. An asynchronous exchange is where both
parties are both not participating at the same time--as in e-mail.
19. Anonymity is important in a GDSS since it enables participants to contribute information without fear of
being identified as the source of information that might be unpopular with one or more members of the
group. This situation is valuable in settings where certain participants have some type of organizational
influence over others, such as a session attended by a manager and his or her employees. Anonymity
enables the employees to voice their opinions free from admonishment by their manager.

Answers to Topics for Discussion


1. An example of a good problem is when the sales force exceeds its sales quota by a wide margin. The
manager can follow up by gathering information from the sales reps to learn why things went so well.
Then, the manager can seek to create a similar sales environment in the future.
2. The solution criterion is obtained by subtracting the current state from the desired state. For example, the
marketing department needs to hire six new sales reps each month and is currently hiring only four. The
solution criterion is two sales reps--what it will take to solve the problem.
3. It's easy to confuse programmed/nonprogrammed decisions and structured/unstructured problems. To
the best of the authors' knowledge, nobody has clearly addressed the connection. One would assume,
however, that the manager makes nonprogrammed decisions when solving an unstructured problem and
makes programmed decisions when solving a structured problem. When solving a semistructured
problem, the manager would make programmed decisions to solve the structured part and make
nonprogrammed decisions to solve the unstructured part.

Answers to Problems
1. A change of the actual salary to $10,500 produces a total variance of a negative $408.09. A change to
$8,500 produces a total variance of $1591.91.
2. A change of the Cash Out figure to $2000 produces an Ending Cash figure for Month 6 of $6486. A
change to $3000 produces an Ending Cash figure for Month 6 of $5486.
3. The spreadsheet will have the exact appearance of Figure 11.5, except that 100 days will be simulated.

Answer to Heritage Homes Case


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1. This sounds like a good expert system application. There are not many experts; the Bradberrys appear to
be doing the best job in the Wilmington area. Also, the problem that the Bradberrys are expert in solving
is complex, there is uncertainty, but yet it can be solved in a reasonable amount of time.
2. Alvin and James appear to be true experts. They know their business and have a successful track record
to prove it.
3. Alvin and James should not develop the system themselves. The brothers no doubt understand how
contractors apply their knowledge in making bids, but they would be novices in extracting those
processes from themselves. In order for the development process to go smoothly, the Bradberrys should
hire a knowledge engineer to perform the knowledge acquisition and create the knowledge base. In terms
of the inference engine and user interface, there is a great amount of difference between writing some
materials cost programs and developing an expert system. Alvin would have to invest a substantial
amount of his time in getting up to speed on the process of developing the inference engine using a
programming language. An expert system shell would be the way to go. So the Bradberrys should hire a
knowledge engineer to implement the system, using an expert system shell.
4. Newcastle Homes could benefit from an expert system in the form of consistently better bids over a
period of time. The Bradberrys most assuredly have good days and bad days, and occasionally submit
poor bids. The expert system could eliminate the poor days or at least make them less frequent. In
addition, the expert system could represent each brother's knowledge. If either Alvin or James ever
decides to leave the business, the remaining brother would have the benefit of the other brother's
knowledge. The expert system would also enable Alvin and James to make their bids faster. This would
make possible a larger number of bids and an expanded business covering a greater geographic area.

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