Chapter 10

Session 1
Decision Support in Business

McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.
Learning Objectives
vIdentify the changes taking place in the form
and use of decision support in business.
vIdentify the role and reporting alternatives of
management information systems.
vDescribe how online analytical processing can
meet key information needs of managers.
vExplain the decision support system concept
and how it differs from traditional
management information systems.

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Learning Objectives
vExplain how the following information systems
can support the information needs of
executives, managers, and business
professionals:
vExecutive information systems
vEnterprise information portals
vKnowledge management systems

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I. Introduction
vAn organization is a nexus of decisions
with information needs supplied by an
Information System

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I. Introduction
vInformation, Decisions, and Management –
the type of information required by decision
makers is directly related to the level of
management decision making and the amount
of structure in the decision situation
v Strategic Management – executive level, long-range plans,
organizational goals and policies, and objectives
v Tactical Management – mid-level management, medium- and
short-range plans to support objectives made by executives,
and allocation of resources and performance monitoring of
organizational subunits
v Operational Management – short-range plans, day-to-day
operations, direct the use of resources and performance of
tasks
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I. Introduction
vDecision Structure
v Structured – operational level, occur
frequently, much information available
v Semi structured – managerial level (most
business decisions are here), not as
frequent, less information available
v Unstructured – executive level, infrequent,
little information available

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I. Introduction
Information Requirements of Decision Makers

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I. Introduction

Dimensions
of
Information

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I. Introduction

Dimensions
of
Information

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 Dimensions
I. Introduction of
Information

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 Dimensions
I. Introduction of
Information

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 Dimensions
I. Introduction of
Information

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II. Decision Support Trends
v Using IS to support business decision
making is increasing
v Business Intelligence (BI) –
memperbaiki pengambilan keputusan
bisnis dengan menggunakan sistem
pendukung berbasis fakta
v Business Analytics (BA) – eksplorasi
berulang dari kinerja historis
perusahaan untuk memperbaiki proses
perencanaan strategis
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Business Intelligence

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III. Decision Support Systems
• IS providing interactive support to
managers during the decision-making
process
• DSS Components – DSS relies on model-
bases as well as databases

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V. Online Analytical Processing
vEnables examination/manipulation of
large amounts of detailed and
consolidated data from many
perspectives

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V. Online Analytical Processing
v Enables examination/manipulation of large amounts
of detailed and consolidated data from many
perspectives
vConsolidation aggregation of data
vDrill-Down – displaying details that comprise the
consolidated data
vSlicing and Dicing – looking at a database from
different viewpoints
vOLAP Examples – the real power of OLAP is the
combining of data and models on a large scale,
allowing solution of complex problems
vGeographic Information (GIS) and Data
Visualization (DVS) Systems
vGIS – facilitate use of data associated with a
geophysical location
vDVS – represent complex data using interactive
3-dimensional models, assist in discovery of
patterns, links and anomalies
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Data Visualization Technologies

vGeographic Information Systems (GIS)

vis a computer-based system for capturing,
integrating, manipulating, and displaying
data using digitized maps.
vRepresentative GIS software vendors are
ESRI (www.esri.com), Intergraph
(www.intergraph.com), and Pitney Bowes
Mapinfo (www.mapinfo.com).

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IV. Management Information Systems

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IV. Management Information Systems

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VI. Using Decision Support Systems
vData Mining for Decision Support – providing
decision support through knowledge discovery
(analyze data for patterns and trends)
vMarket Basket Analysis (MBA) – one of the most
common and useful types of data mining; MBA
applications:
vCross-Selling – offer associated items to that being
purchased
vProduct Placement – related items physically near each
other
vAffinity Promotion – promotions based on related products
vSurvey Analysis – useful to analyze questionnaire data
vFraud Detection – detect behavior associated with fraud
vCustomer Behavior – associate purchases with demographic
and socioeconomic data 10-24
VII. Executive Information Systems (EIS)
a.k.a. Executive Support Systems (ESS)

vPopular to the point of being called

“Everyone’s Information Systems”
vFeatures of an EIS – can be tailored to
preferences of the executive, provides drill-
down capabilities and “dashboards”

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 Management Cockpit

v The management cockpit is a strategic

management room that enables top-
level decision makers to pilot their
businesses better.
v The environment encourages more
efficient management meetings and
boosts team performance via effective
communication.
v Key performance indicators and
information relating to critical success
factors are displayed graphically on
the walls of the meeting room.
v External information can be easily Source: The Management Cockpit is a registered trademark of SAP,created
imported to the room to allow by Professor M.Georges.

competitive analysis.

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VIII. Enterprise Portals and Decision
Support

vEnterprise Information Portals (EIP) –

Web-based interface with integration of
MIS, DSS, EIS, etc., to give
intranet/extranet users access to a
variety of applications and services

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IX. Knowledge Management Systems

vUse of IT to gather, organize, and share

knowledge within an organization
vEnterprise Knowledge Portal – entry to
knowledge management systems

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THANK YOU J

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