Bus 290: Chapter 12

1. Bus 290: Chapter 12 Enhancing Decision Making

2. Objectives • What are the different types of decisions and how does the D.M. process work • How do IS support the activities of managers and management decision making • How do business intelligence and business analytics support decision making • How do different decision making constituencies • What is the role of information systems in helping people working in a group make decisions more efficiently

3. Why do we care? • Business decisions are made under uncertainty • We, as decision makers, should minimize uncertainty • Business decisions involve risk • One way to assess risk is to look at past events • Decisions can be routine events or once in a lifetime • Unstructured, semi-structured or structured …

4. Unstructured • “novel, important and non-routine” • As such no agreed on procedure … not in SOP’s • Needs: • Judgement • Thought • Experience • Usually occur at higher levels of management

5. Structured Decision • “Repetitive and routine” • Known procedure to handle them (SOP’s) • Usually related to day-to-day operations • Lower levels of management or non-managers • Swmi-structured shares aspects of both

6. Decision Making Process • Remember 1st year Admin … • Text uses Simon’s 4 stage • Intelligence – Why, where, effects • Design • Choice • Implementation (and review)

7. So what? • Management Information Systems • DSS • ESS • All to improve our decision making

8. Quality of the decision • Quality of information • Accuracy • Recency • Completeness • Management Filters • Focus • Inured • Comfort level • Biases • Organizational Inertia & Politics • “not our fault”

9. Business Intelligence Infrastructure for: • Warehousing • Integrating • Reporting • Analyzing Data that is internal and external “single, coherent, enterprise-wide” data set

10. Business analytics • Tools and techniques for analyzing data • OLAP, statistics, models, data mining

11. 6 elements in the BI environment • Data from the business environment • Business intelligence infrastructure • Business analytics toolset • Managerial users and methods • Delivery platform – MIS, DSS, ESS • User interface

13. BI and Analytics Capabilities • Production Reports • Parameterized Reports • E.g. by region or quarter • Dashboards/scorecards • Ad hoc/query/search/report creation • Drill Down • Forecasts, scenarios, models

15. Odds and .. • Data visualisation • G.I.S.

16. Developing BI and BA Capabilities One-stop integrated solution • Hardware firms sell software that run optimally on their hardware • Makes firm dependent on single vendor – switching costs Multiple best-of-breed solution • Greater flexibility and independence • Potential difficulties in integration • Must deal with multiple vendors

17. Constituencies (1) Decision Support for Operation & Middle Mgmt • Support for semi-structured Decision • Decision Support Systems (DSS) • Sensitivity Analysis • Pivot tables in Excel • Modelling • Simulations • Regression

18. Constituencies (2) • Senior management • Balanced Scorecard … • KPI’s • Enterprise performance • Drill-down

20. Constituencies (3) • Group decision support systems (GDSS) • Interactive system to facilitate solution of unstructured problems • Hardware – computer &networking hardware, overhead projectors, display screens • GDSS software collects, documents, ranks, edits and stores participant ideas, responses • May require facilitator and staff • Enables increasing meeting size and increasing productivity • Promotes collaborative atmosphere, guaranteeing anonymity • Follow structured methods for organizing and evaluating ideas and preserving meeting results

21. Ch 12 Homework • Decision Problems 1 & 2 • Discussion Question #3