IENG 423 Design of Decision Support Systems Decision Support System Concepts

IENG 423Design of Decision Support Systems

Decision Support System Concepts

Decision Support Systems

Recall the house selling problem- Offer A: $180,000 Offer B: $150,000 Goal: maximize the amount received

for the house


So, what is the problem in making this decision? Decision: accepting offer A satisfies

the goal, so offer A it is.

Do we need a support system to make this decision?Probably not.


So, when do we need a decision support systemMost real-world decision making faced by company, government and other decision makers is more complex than this


We have already talked about some complications… Multiple objectives Conflicting objectives Subjective Expected Utility of decision

makers


But there are other complications to decision making Requires new knowledge or skill

We are missing piece of knowledge or skill needed to figure it out

Computational demand too high We could calculate a solution but is it too complex

for decisions in reasonable time Data acquisition load too high

There’s too much data to retrieve or analyze to make the appropriate decision

Requires a high level of expertise


Requires new knowledge or skill We don’t know how to figure it out

Back to selling our house Offer A: $180,000 Offer B: ¥15,000,000

Which do you choose? Missing knowledge How do we fix this problem? www.xe.com


Computational demand too high We could calculate a solution but is it too complex for

decisions in reasonable time You work for a school board and you have been

asked to figure out the financial and performance implications of replacing a fleet of school buses to hybrids (hydrocarbon fuel/battery)

Under difference scenarios – all or phased, several different vendors, gasoline, ethanol, ethanol from lunch room wastes, E85,…)

Could you calculate this? Yes Would it be easy? No Computational modeling – simulations, forecasts,

spreadsheets Excel


Data acquisition load too high There’s too much data to retrieve and/or analyze

to make the appropriate decision You work for a clothing manufacturer that

regularly bids on contracts to provide uniforms in large quantities

Your colleagues have to select from hundreds of textile suppliers, each with 100s of fabrics with a variety of qualities and characteristics, different levels of availability, and at various prices…


Data acquisition load too high There’s too much data to retrieve and/or

analyze to make the appropriate decision Clothing bids …continued… How do you find the right materials to bid

this job and satisfy the resulting contract Start calling the suppliers Thumb through catalogs Retrieve the needed data from a

database Access, MySQL, Oracle, …


Requires a high level of expertise Complex chains of decisions Work through set of logical inferences Triage in a hospital emergency room

Patient: Male, 65 years old, escaped from structure fire in home, minor burns on arms and legs, chest pains, shortness of breath,…

Decision: what to do- apply treatment, get more data (blood test)

Replicate the behavior of a human expert Expert systems, VP-Expert, custom application

What is a Decision Support System?

“Any information system that is not a transaction processing system”…so what is a transaction processing system?…not a good definition!

What is a Decision Support System

…not the same as a Management Information System (MIS)…not the same as a data processing system


Decision Support Systems… “Assist managers in their decision making

processes in semistructured tasks.” “Support, rather than replace, managerial

judgment.” “Improve the effectiveness of decision

making rather than efficiency” from: Peter Keen and Michael Morton, “Decision

Support Systems: An Organizational Perspective” Addison Wesley, 1978


“Decision support systems are a class of computer-based information systems including knowledge based systems that support decision making activities. “ from Wikipedia

http://en.wikipedia.org/wiki/Decision_support_system


For our purposes- an Information System computer based support decision making

that means there are decisions to make decisions are information based

designed for specific target users designed for critical decisions designed for recurrent use (usually)


A DSS must – Address a problem area or domain Have a set of target users (decision makers) Have a set of goals – one or more Have a set of decisions that address each of

the goals Each decision must be supported by

information (data elements, reports, projections, etc.)

Each decision must have a set of alternatives (choices)

Each alternative must have an associated action


A DSS should have Metrics – measures of performance in

terms of system goals Feedback – a way to assess the

effectives of the DSS in supporting the decision making process


A DSS must – have a means to collect and store relevant

data have a means to retrieve, filter and organize

relevant data have a mechanism to process, transform,

and analyze information have the ability to deliver or present

information in decision relevant ways (interface)

A Decision Support System

is not a completely automated systemis intended to compliment the human useris not intended to replace expertise and human judgmentis intended to make decision making better or even possible in situation where it would be difficult or impossible


Can use a range of tools to support decision makingHave been around for a while, buttake advantage of modern technologyA variety of modern information system tools make powerful Decision Supports Systems widely available and accessible


Applications Manufacturing Agriculture Homeland Security Urban Planning Medicine and anything else

Documents

IENG 423 Design of Decision Support Systems Decision Support System Concepts