Using Information Systems for Decision Making

blabbedharborAI and Robotics

Feb 23, 2014 (3 years and 8 months ago)

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II

Information Systems Technology

Ross Malaga


8

"Part II Using Information Systems“

Copyright © 2005 Prentice Hall, Inc.

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1

Using Information

Systems for

Decision Making

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2

LEARNING GOALS


Discuss the problems associated with management decision
making.


Explain the decision
-
making process.


Describe decision support systems.


Explain how group decision support systems work.


Describe executive information systems.


Discuss artificial intelligence technologies and their
applications.

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Expansion is on the horizon.


Three new studios


Five new franchises


Many difficult decisions


Meredith


Needs help making strategic decisions


Suzanne


Where to locate the new studios?


Leda


How to evaluate potential franchisees?


Mitch


Scheduling and routing sales appointments


Julia


Purchase or lease new buildings?


Miriam


Where should we focus our marketing resources?


Rachel


How do I maintain the right inventory at the right price?


Jim


Needs help with hiring decisions



Using Information Systems for
Decision Making

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Decision Making Today


Business decisions are increasingly difficult to
make


Dramatic increase in the internal business data available
to managers


Managers must keep current on vast amounts of data
resources on the Internet


Globalization


The speed of commerce


The increased number of business choices available


Group decision making


Teams may include members from many companies


Members may have different backgrounds and opinions


Difficult to reach consensus


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Roadblocks to Good Decision
Making


Human cognition


Our mental ability to comprehend and understand
something


Human perception


Difficulty isolating problems


Tend to think of only narrow range of possible solution


Human bias


Tendency to shape responses based on stereotypes,
memory, and current position

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How to Overcome the
Roadblocks


Decision support systems (DSS) are one tool


A computer
-
based system that supports and improves
human decision making


Helps analyze complex problems


Process vast amounts of analytical data


Group decision support systems (GDSS)


Tool for supporting team decision making


Executive information system (EIS)


Computer
-
based system that supports the decision
-
making
processes of senior managers

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7

The Decision
-
Making Process


Simon’s model of the decision
-
making process


Intelligence


Design


Choice


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Intelligence Phase


Scan the environment for a problem.


Determine if decision
-
maker can solve the
problem.


Within scope of influence


Fully define the problem by gathering more
information about the problem.



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Design Phase


Develop a model of the problem.


Determine type of model.


Verify model.


Develop and analyze potential solutions.

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Choice Phase


Select the solution to implement.


More detailed analysis of selected solutions
might be needed.


Verify initial conditions.


Analyze proposed solution against real
-
world
constraints.

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Problem
Structure


Structured problems


We know the proper procedures


Unstructured problems


We do not know the how to approach any of
the 3 phases


Semi
-
structured problems

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Decision Support Systems


Major components


Data management system


Internal and external data sources


Model management system


Typically mathematical in nature


User interface


How the people interact with the DSS


Data visualization is the key


Graphs


Charts


Geographic information systems (GIS)


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Modeling Tools and Techniques


Simulation


Computerized model of the problem


Used to examine proposed solutions and their impact


Sensitivity analysis


Determine how changes in one part of the model influence other
parts of the model


What
-
if analysis


Manipulate variables to see what would happen in given
scenarios


Goal
-
seeking analysis


Work backward from desired outcome

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Groups Decision Support Systems


Having multiple participants in the decision
process adds potential problems


Production blocking


Evaluation apprehension


Social loafing


Group think


GDSS tools contain special tools to
overcome these problems


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GDSS Tools


Brainstorming tools


Commenter tools


Categorizing tools


Idea
-
ranking tools


Electronic
-
voting tools


Group facilitator

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Executive Information Systems


Computer
-
based tool that specifically helps
top
-
level

management make strategic
decisions


Processes both
internal

and
external

data


Presents data in summary form


Drill
-
down

is a key feature


gives the manager
the ability to see more details when needed


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Artificial Intelligence (AI)


Field of study that explores the
development of computer systems that
behave like humans


Strong AI


create a computer that can think
like a human


Weak AI


develop computers and programs
that employ
thinkinglike

features

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Expert Systems


AI systems that codify
human expertise

in a
computer system


Main goal is to transfer knowledge from one person to
another


Wide range of subject areas


Medical diagnosis


Computer purchasing


Whale watching


Knowledge engineer elicits the expertise from the
expert and encodes it in the expert system

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Expert Systems Components


Knowledge base


Inference engine


User interface


Explanation system

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Other Artificial Intelligence Technologies


Neural networks


use software to simulate the
neural working of the human brain


Intelligent agents (
bots
)


autonomously handle
tasks for humans and act on user’s behalf


Genetic algorithms


Computer instructions that
create a population of thousands on potential
solutions and evolves the population toward better
solutions


Fuzzy logic


a way to get computers to come
closer to the ability to see fine distinctions, not just
ones and zeros


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A Neural Network

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Bead Bar Consultant


How Decision
-
Making Technologies Affect the Bead
Bar.


Meredith


EIS looks to provide needed support and a
reality check

on previous decisions


Suzanne


GIS help to determine new studio locations


Leda


Develop a DSS to evaluate franchise applicants


Mitch


Use genetic algorithms to solve the sales
appointment problem


Julia


Use Excel to perform What
-
if and goal
-
seeking
analyses


Miriam


Use expert system to determine the best
marketing media


Rachel


Intelligent agents to search for best pricing


Jim


Expert system to assist employees in selecting best
combination of benefits options

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Learning Goals Summary

In this chapter you have learned:



The problems associated with management decision making



The decision
-
making process



How to describe decision support systems



How group decision support systems work



How to describe executive information systems



About artificial intelligence technologies and their applications