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• Business environment is becoming more and more complex and rapidly changing, making decision making more difficult
• Must respond and adapt by making faster and be<er decision.
• Intui?on may not be enough, hence computerised systems are required.
• "Business Intelligence is a set of methodologies, processes, architectures, and technologies that transform raw data into meaningful and useful informa?on used to enable more effec?ve strategic, tac?cal, and opera?onal insights and decision-‐making."[6]
• 1958 researcher conned this term intelligence, IBMs hans peter Luhn "the ability to apprehend the interrela?onships of presented facts in such a way as to guide ac?on towards a desired goal."[4]
Car company case scenario
• car company fic??ous case: • car logis?cs • problem:increasing costs • increasing issues, delays , data entry errors. some issues resolved with data analysis
• more managers could see problems of overbilling and delays
• sample indicates: mul?ple things: flow of informa?on, fast decisions, vast amounts of data, collabora?on:
The Business Environment • because of the modern factors, decision making is become complex requiring knowledge of
business, data, data representa?on; hence a computerized system is required.
Different ac;ons taken by managers to counter the pressure: • Employee strategic planning • Use new and innova?ve business models • Restructure business processes • Par?cipate in business alliances • Improve corporate informa?on system Con?nue…
• Improve partnership rela?onships • Encourage innova?on and crea?vity • Improve customer service and rela?onships • Move to electronic commerce(e-‐commerce) • Move to make-‐to-‐order produc?on and on-‐demand manufacturing and services
• Use new IT to improve communica?on, data access(discovery of informa?on)
Con?nue…
• Respond quickly to compe?tor’s ac?ons(e.g. in pricing, promo?on, new products and services)
• Automate many tasks of white-‐collar employees
• Automate certain decision processes, especially those dealing with customers
• Improve decision making
Why we use computerized Decision Support System
• Speedy computa?ons • Improved communica?on and collabora?on • Increased produc?vity of group members • Improved data management • Managing giant data warehouses • Quality support • Agility support Con?nue….
• Overcoming cogni?ve limits in processing and storing informa?on
• Using the web • Anywhere, any?me support
Simon’s Decision Making Process
• Decision making process:
Intelligence(searching for condi?ons
• Design
• Choice
• Implementa?on
Computerized Decision Support
• Computer support for Structured decision -‐Automated Decision making(rule based system, price determina?on; loan or not, price op?msa?on)
• Computer support for unstructured decision
• Computer support for semi structured problems
Decision Support System(DSS)
• “Decision support system couple the intellectual resources of individuals with the capabili?es of the computer to improve the quality of decisions. It is a computer-‐based support system for management decision makers who deal with semi structured problems”
-‐By Keen and Sco<-‐Morton(1978)
Architecture of DSS
• Types of DSS 1.Model-‐oriented DSS 2.Data-‐oriented DSS
1 – model is quan?ta?ve D-‐ data oriented : adhoc queries and repor?ng
Framework for Business Intelligence(BI)
What is BI? • An umbrella that combines architectures, tools, database, analy?cal tools, applica?ons and methodologies.
• Content-‐free expression • Objec?ve:1.To enable interac?ve access to data 2.To enable manipula?on of data 3.To give managers & analyst the ability to conduct appropriate analysis.
Components Of BI system
BI system has four major components: • Data warehouse: Source data • Business Analy2cs: a collec?on of tools for manipula?ng, mining, and analyzing the data in the data warehouse
• Business performance management: for monitoring & analyzing performance
• User interface: Dashboard & other informa?on broadcas?ng tools
Benefits of BI
The major benefits of BI: • Faster, more accurate repor?ng • Improved decision making • Improved customer service • Increased revenue Apart from these, there are several other like-‐ • Time saving • Single version of the “truth” • Be<er strategies and plans • More efficient process • Cost saving
Bperformance mgmt
• Adds management and feedback to core BI • Top – bo<m process
• Balanced scorecard and dashboards
Summary • Similar architecture because BI evolved from DSS. • DSS are constructed to directly support specific decision making while BI are for indirect support.
• BI has an execu?ve & strategic orienta?on while DSS is oriented toward analyst.
• BI are constructed with commercially available tools & components while DSS is construc?ng solu?ons to unstructured problems.
• DSS were mostly in the academic world.BI were developed by solware companies.
• Many of the tools that BI uses are also considered DSS tools.
Management Support System
• Combina?on of DSS and BI tools.
• Technology that supports managerial tasks in general and decision making in par?cular.
• MSS use when the nature of the technology involved is not clear, and use it interchangeably with the combined term DSS/BI.
• Vendor names: Microstrategy, microsol, IBM, oracle, Hyperion, cognos, Business objects,SAS,exsys,SAP
Work system view
• Remove systems from DSS • Improve decision making
• Alter(2004) Process, par?cpants, info,tech,product,customers.infra,environment,strategy
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