1 MIS, Chapter 12 ©2014 Cengage Learning MANAGEMENT SUPPORT SYSTEMS CHAPTER 12 Hossein BIDGOLI MIS

1MIS, Chapter 12

©2014 Cengage Learning

MANAGEMENT SUPPORT SYSTEMS

CHAPTER 12

Hossein BIDGOLI

MIS

2MIS, Chapter 12


Chapter 12 Management Support Systems

LO1 Describe the phases of the decision-making process in a typical organization and the types of decisions that are made.

LO2 Describe a decision support system.

LO3 Explain an executive information system’s importance in decision making.

LO4 Describe group support systems, including groupware and electronic meeting systems.

LO5 Summarize the uses for a geographic information system.

l e a r n i n g o u t c o m e s

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LO6 Describe the guidelines for designing a management support system.

l e a r n i n g o u t c o m e s (cont’d.)


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Types of Decisions in an Organization

• Structured decisions– Well-defined standard operating procedure

exists– Also called programmable tasks– Can be automated

• Semistructured decisions– Not as well-defined by standard operating

procedures– Include a structured aspect that benefits from

information retrieval, analytical models, and information systems technology

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Types of Decisions in an Organization (cont’d.)

• Unstructured decisions– Typically one-time decisions– Does not rely on standard operating procedure – Decision maker’s intuition plays the most

important role– Information technology offers little support for

these decisions

• Management support systems (MSSs)– Different types of information systems have

been developed to support certain aspects and types of decisions

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Phases of the Decision-Making Process

• Herbert Simon– Winner of the 1978 Nobel Prize in economics– Defines three phases in the decision-making

process: intelligence, design, and choice– Fourth phase, implementation, can be added

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Intelligence Phase

• Decision maker examines the organization’s environment for conditions that need decisions

• Data is collected from a variety of sources and processed

• Decision maker can discover ways to approach the problem

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The Intelligence Phase (cont’d.)

• Three parts – First: determine what the reality is– Second: get a better understanding of the

problem by collecting data and information about it

– Third: gather data and information needed to define alternatives for solving the problem

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Design Phase

• Objective – Define criteria for the decision– Generate alternatives for meeting the criteria– Define associations between the criteria and

the alternatives

• Defining associations between alternatives and criteria involves understanding how each alternative affects the criteria

• Information technology does not support this phase of decision making much

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Choice Phase

• Best and most effective course of action is chosen– From the practical alternatives

• Analyze each alternative and its relationship – To the criteria to determine whether it’s

feasible

• Decision support system (DSS) can be particularly useful in this phase

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Implementation Phase

• Organization devises a plan for carrying out the alternative selected in the choice phase

• Obtains the resources to implement the plan

• DSS can do a follow-up assessment on how well a solution is performing

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Decision Support Systems

• Decision support system (DSS) – Interactive information system– Consisting of hardware, software, data, and

models (mathematical and statistical) – Designed to assist decision makers in an

organization

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Decision Support Systems (cont’d.)

• Requirements:– Be interactive– Incorporate the human element as well as

hardware and software– Use both internal and external data– Include mathematical and statistical models– Support decision makers at all organizational

levels– Emphasize semistructured and unstructured

tasks

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Components of a Decision Support System

• Three major components:– Database– Model base

• Includes mathematical and statistical models that enable a DSS to analyze information

– User interface• How users access the DSS

• DSS engine– Manages and coordinates these major

components

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Exhibit 12.2 Components of a DSS

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DSS Capabilities

• What-if analysis• Goal-seeking• Sensitivity analysis• Exception reporting analysis• More capabilities, such as:

– Graphical analysis, forecasting, simulation, statistical analysis, and modeling analysis

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Roles in the DSS Environment

• Roles include: – User, managerial designer, technical designer,

and model builder

• Users – Most important role because they’re the ones

using the DSS

• Managerial designer – Defines the management issues in designing

and using a DSS

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Roles in the DSS Environment (cont’d.)

• Technical designer – Focuses on how the DSS is implemented

• Model builder – Liaison between users and designers

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Costs and Benefits of Decision Support Systems

• Benefits of a DSS:– Increase in the number of alternatives examined– Fast response to unexpected situations– Ability to make one-of-a-kind decisions– New insights and learning– Improved communication– Improved control over operations– Cost savings from being able to make better

decisions and analyze several scenarios (what-ifs) in a short period

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Costs and Benefits of Decision Support Systems (cont’d.)

– Better decisions– More effective teamwork– Time savings– Better use of data resources

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Executive Information Systems

• Branch of DSSs• Interactive information systems that give

executives easy access to internal and external data

• Typically include:– “Drill-down” features– Digital dashboard

• Ease of use – EIS designers should focus on simplicity when

developing a user interface

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Executive Information Systems (cont’d.)

• Require access to both internal and external data – So that executives can spot trends, make

forecasts, and conduct different types of analyses

• Should also collect data related to an organization’s “critical success factors”

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Executive Information Systems (cont’d.)

• Digital dashboard– Integrates information from multiple sources

and presents it in a unified, understandable format

– Often charts and graphs

• Many digital dashboards are Web-based

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Exhibit 12.3 Digital Dashboard

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Reasons for Using EISs

• Increase managers’ productivity• Convert information into other formats• Spot trends and report exceptions

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Avoiding Failure in Design and Use of EISs

• Factors that can lead to a failed EIS:– Corporate culture isn’t ready– Organizational resistance to the project– Project is viewed as unimportant– Management loses interest or isn’t committed – Objectives and information requirements can’t

be defined clearly– System doesn’t meet its objectives– System’s objectives aren’t linked to factors

critical to the organization’s success– Project’s costs can’t be justified

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Avoiding Failure in Design and Use of EISs (cont’d.)

– Developing applications takes too much time– System is too complicated– Vendor support has been discontinued– Executives themselves– Nature of executives’ work– Nature of information the EIS provides

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EIS Packages and Tools

• Generally designed with two or three components:– Administrative module for managing data

access– Builder module for developers to configure

data mapping and screen sequencing– Runtime module for using the system

• Some EIS packages provide a data storage system

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EIS Packages and Tools (cont’d.)

• Tasks managers perform for which an EIS is useful:– Tracking performance– Flagging exceptions– Ranking– Comparing– Spotting trends– Investigating/exploring

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Group Support Systems

• Use computer and communication technologies to formulate, process, and implement a decision-making task

• Considered a kind of intervention technology that helps overcome the limitations of group interactions

• Reduce communication barriers• Introduce order and efficiency into

situations that are inherently unsystematic and inefficient

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Group Support Systems (cont’d.)

• Useful for:– Committees– Review panels– Board meetings– Task forces– Decision-making sessions that require input

from several decision makers

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Groupware

• Assist groups in:– Communicating, collaborating, and

coordinating their activities

• Intended more for teamwork than for decision support

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Groupware (cont’d.)

• Some capabilities of groupware include:– Audio and video conferencing– Automated appointment books– Brainstorming– Database access– E-mail– Online chat– Scheduling– To-do lists– Workflow automation

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Groupware (cont’d.)

• Examples of Web-based GSS tools:– Microsoft Office SharePoint Server and IBM

Lotus Domino

• Other software used for e-collaboration:– Electronic meeting systems, such as Microsoft

LiveMeeting, Metastorm, and IBM FileNet

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Electronic Meeting Systems

• Enable decision makers in different locations to participate in a group decision-making process

• Various types; all have these features:– Real-time computer conferencing– Video teleconferencing– Desktop conferencing

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Advantages and Disadvantages of GSSs

• Advantages:– Costs as well as stress are reduced due to

decreased travel– More time to talk with each other and solve

problems– Shyness isn’t as much of an issue in GSS

sessions– Increasing collaboration improves the

effectiveness of decision makers

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Advantages and Disadvantages of GSSs (cont’d.)

• Disadvantages:– Lack of the human touch– Unnecessary meetings– Security problems– Costs of GSS implementation are high

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Geographic Information Systems

• Captures, stores, processes, and displays geographic information

• Uses spatial and nonspatial data• Uses three geographic objects:

– Points– Lines– Areas

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Geographic Information Systems (cont’d.)

• Common example of a GIS:– Getting driving directions from Google Maps– User-friendly interface that helps you visualize

the route– After you make a decision, you can print

driving directions and a map

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GIS Applications

• Education planning• Urban planning• Government• Insurance• Marketing• Real estate• Transportation and logistics

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Guidelines for Designing a Management Support System• Get support from the top• Define objectives and benefits clearly• Identify executives’ information needs• Keep the lines of communication open• Hide the system’s complexity and keep the

interface simple• Keep the “look and feel” consistent• Design a flexible system• Make sure response time is fast

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Summary

• Different types of decisions • Stages of decision making in a typical

organization• DSS:

– Components, capabilities, key players, and costs and benefits

• Executive information systems• Group support systems• Geographic information systems

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1 MIS, Chapter 12 ©2014 Cengage Learning MANAGEMENT SUPPORT SYSTEMS CHAPTER 12 Hossein BIDGOLI MIS