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Decision Support Systems: Types, Models, and Capabilities

This chapter explores the different types of decisions and problems, as well as the capabilities of Decision Support Systems (DSS) in solving them. It also discusses the advantages and disadvantages of modeling and the features of Group Decision Support Systems (GDSS) and Executive Support Systems (ESS).

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Decision Support Systems: Types, Models, and Capabilities

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  1. Chapter 10 Decision Support Systems

  2. Types of Decisions/Problems • Structured or Programmed • Rules known • Steps known • No judgment or creativity • Unstructured or Nonprogrammed • Rules unknown • Steps unknown • Requires judgment &/or creativity • Semistructured or Semiprogrammed: Fall between structured & unstructured • DSS support semistructured & unstructured problem solving IS for Management

  3. Consider Decision Making & Problem Solving as the Same (Figure 10.1) • Simon-Huber Model of Decision Making Intelligence: Identify & define potential problems &/or opportunities Design:Develop alternative solutions to the problem Choice:Select a course of action Implementation: Put choice into action Monitoring: Feedback will affect previous stages in model IS for Management

  4. Types of Solutions • Optimization • Finding the best solution • Example in Fig. 10.3: Using Excel’s Solver • Satisficing • Finding a good -- but not necessarily the best -- solution to a problem • Most common in personal & professional lives • Heuristics • Commonly accepted guidelines or procedures • Usually find a good solution. (AKA “rules of thumb”) IS for Management

  5. Factors to be Considered in Solving Problems • Multiple decision objectives • Increased alternatives • Increased competition • Need for creativity • Social & political actions (includes legal issues) • International issues • Technology • Time compression IS for Management

  6. Characteristics of Most DSSs • Handle large amounts of data from different sources • Provide report & presentation flexibility • Provide both textual & graphical orientation • Provide drill down analysis • Perform complex, sophisticated analysis & comparisons using advanced software packages • What if analysis • Sensitivity analysis • Goal-seeking analysis • Simulation • Support optimization, satisficing, & heuristic approaches IS for Management

  7. Capabilities of DSSs • Support all stages of decision making model • Support different decision frequencies: One of a kind or Repetitive • Support all different problem structures • Support all decision making levels IS for Management

  8. Comparison of TPS/MIS/DSS • Type of problem solved/decision to be made • Support given to users • Decision emphasis & approach • Type, speed, & output of system used • Development of system used • In most organizations, they are integrated through a common database. • DSS software can use Web technology to access databases through the Internet, intranet, or extranet. IS for Management

  9. Components of a DSS (Figure 10.9) IS for Management

  10. DSS Models Base • Model Base: Provides access to a variety of models to assist in decision making Major Types of DSS Models • Financial • Statistical • Graphical • Project management IS for Management

  11. Advantages & Disadvantages of Modeling • Advantages • Less expensive than custom approaches or real systems. • Faster to construct than real systems • Less risky than real systems • Provide learning experience through trial and error • Future projections are possible • Can test assumptions • Disadvantages • Assumptions about reality may be incorrect • Accuracy of predications often unreliable • Requires abstract thinking IS for Management

  12. Group Decision Support Systems: GDSS(Figure 10.12) • Contain most of the elements of DSS & additional software to provide effective support in group decision-making settings • Characteristics of Most GDSSs • Special design • Ease of use • Flexibility • Decision-making support • Delphi approach, brainstorming, group consensus (See Fig 10.13), nominal group technique (NGT) • Anonymous input • Reduction of negative group behavior • Parallel communication • Automated record keeping • Cost, control, complexity factors IS for Management

  13. Components of a GDSS • Same as DSS + • Communication/networking capability • Special software (called groupware) IS for Management

  14. GDSS Alternatives Matrix (Figure 10.15) IS for Management

  15. Executive Support System A specialized DSS that supports strategic-level decision making Levels of Executive (Strategic) Decision Making • Board of directors • President / CEO • Functional area VPs & directors • Functional area managers IS for Management

  16. Characteristics of ESS • Tailored to individual executives • Easy to use • Drill down capabilities • Can access external data • Can deal with a high degree of uncertainty • Future orientation • Linked with value-added business processes IS for Management

  17. Capabilities of an ESS • Support for defining overall vision • Support for strategic planning • Support for strategic organizing & staffing • Support for strategic control • Support for crisis management IS for Management

  18. Chapter 10 Case • Case 2, pp. 474-75: Motley Fools Web site In addition to the end of case questions presented in the text, consider the following: What functionality(ies) from Motley Fools would you consider especially useful for a DSS? IS for Management

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