DECISIONSUPORT SYSTEM

SARMAG 2020

How Can Information Systems Help Managerial Work?

◦What do managers do?◦ Functions:

◦ Planning, organizing, actuating, controlling (POAC)

◦ Roles

◦ interpersonal

◦ informational

◦ Decisional

Membutuhkan bantuan utk pengolahan informasi - reducing uncertainty and resolving equivocality (PERLU INFORMASI YANG KAYA – RICHNESS)

Which media is more suitable to support managerial work?

Less Rich More Rich

Rules &

regulationsMIS special

reportsDSS Direct

contact

Group

meetings

Media Richness

Equivocality reduction(clarify, reach

agreements

decide which questions

to ask)Uncertainty reduction(obtain additional data

seek answers to explicit questions)

Decision Making Process

◦ Intelligence

◦ Sensing, finding, identifying, and defining

problem/opportunity

◦ Design

◦ Diagnosing the problem/opportunity

◦ Generating alternatives

◦ Choice

◦ Choosing the best alternative

Decision Support Systems

◦an information system

◦purpose to provide information for making

informed decisions

◦ interactive (needed for experimenting and

prospecting)

Definitions of DSS

◦ Gorry and Scott-Morton (1971): Management Decision Systems --

Interactive computer-based systems, which help decision makers

utilize data and models to solve unstructured problems.

◦ Keen and Scott-Morton (1978): Decision support systems couple the

intellectual resources of individuals with the capabilities 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.

Basic Themes of DSS

◦ Information systems.

◦ Used by managers.

◦ Used in making decisions.

◦ Used to support, not to replace people.

◦ Used when the decision is "semistructured" or "unstructured."

◦ Incorporate a database of some sort.

◦ Incorporate models.

Types of Decisions in an Organization◦ Structured decisions

◦ Can be automated because a well-defined standard operating procedure exists for these types of decisions

◦ Known as programmable tasks

◦ Semistructured decisions

• Include a structured aspect that benefits from information retrieval, analytical models, and information systems technology

◦ Unstructured decisions

• One-time decisions with no standard operating procedure

• Decision maker’s intuition plays a important role as information technology offers less support for the decisions

• Challenges in semistructured and unstructured decisions

◦ Involve multiple criteria

◦ Users have to choose between conflicting objectives

Organizational Levels and Types of Decisions

10

Working Definition of DSS

◦ A DSS is an interactive, flexible, and adaptable CBIS,

specially developed for supporting the solution of a non-

structured management problem for improved decision

making. It utilizes data, it provides easy user interface,

and it allows for the decision maker’s own insights

◦ DSS may utilize models, is built by an interactive process

(frequently by end-users), supports all the phases of the

decision making, and may include a knowledge

component

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition

Copyright 2001, Prentice Hall, Upper Saddle River, NJ

11

Characteristics and Capabilities of DSS

1. Provide support in semi-structured and unstructured situations,

includes human judgment and computerized information

2. Support for various managerial levels

3. Support to individuals and groups

4. Support to interdependent and/or sequential decisions

5. Support all phases of the decision-making process

6. Support a variety of decision-making processes and styles

(more)

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition

Copyright 2001, Prentice Hall, Upper Saddle River, NJ

12

7. Are adaptive

8. Have user friendly interfaces

9. Goal: improve effectiveness of decision making

10. The decision maker controls the decision-making process

11. End-users can build simple systems

12. Utilizes models for analysis

13. Provides access to a variety of data sources, formats, and types

Decision makers can make better, more consistent decisions in a timely manner

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition

Copyright 2001, Prentice Hall, Upper Saddle River, NJ

Phases of Decision Making

Intelligence Phase

Design Phase

Choice Phase

Implementation Phase

Intelligence Phase◦ Decision maker examines the organization’s environment for conditions that need

decisions

◦ Data is collected from a variety of sources and processed

• Allows decision maker to discover ways to approach the problem

Design Phase

◦ Defines criteria for the decision

◦ Generates alternatives for meeting the criteria

◦ Defines associations between the criteria and the alternatives

◦ Requires understanding how each alternative affects the criteria

◦ Information technology does not support this phase of decision making

Choice Phase

◦ Involves selecting best and most effective course of action is from the alternatives

◦ Analyzes each alternative and its relationship to the criteria to determine whether it is

feasible

◦ Decision support system (DSS)

• Helps sort through possible solutions to choose the best one for the organization

• Includes tools for calculating cost-benefit ratios

Implementation Phase◦ Organization devises a plan for carrying out the alternative selected in the choice

phase and obtains the resources to implement the plan

◦ DSS does a follow-up assessment on how well a solution is performing

KOMPONEN DSS

Components of a Decision Support System

◦ Database

◦ Includes internal and external data, and a database

management system (DBMS)

◦ Enables a DSS to perform data analysis operations

◦ Model base

◦ Includes mathematical and statistical models that enable a DSS

to analyze information

DSS Capabilities

◦ DSS includes following features to support decision making

◦ What-if analysis

◦ Goal-seeking

• Sensitivity analysis

• Exception reporting analysis

◦ Other capabilities

• Graphical analysis, forecasting, simulation, statistical analysis,

and modeling analysis

Roles in the DSS Environment

◦ User

• Crucial because they use the DSS

• Include department or organizational units in addition to people

◦ Managerial designer

• Defines the management issues in designing and using a DSS

• Issues are related to management’s goals and needs

◦ Technical designer

• Focuses on how the DSS is implemented

• Addresses questions about data storage, file structure, user access, response time, and security measures

◦ Model builder

• Liaison between users and designers

• Responsible for supplying information on:

- What the model does

- What data inputs the model accepts

◦ How the model’s output should be interpreted

◦ What assumptions go into creating and using the model

MOHON DIBACAJOURNAL ARTICLE

A PSYCHOLOGICAL APPROACH TO DECISION SUPPORT SYSTEMS STEPHEN J. HOCH AND DAVID A. SCHKADE

THE END