Chapter1 Decision Support Systems And Business Intelligence

Topics: Decision support system, Decision theory, Decision engineering Pages: 8 (2294 words) Published: February 28, 2015
1. Decision support systems and business intelligence
The repaid changing and increasingly complex business environment drive companies to operate innovatedly. However, these situations require the company to make more important decisions that need a substantial amount of data, information and knowledge.Norfolk southern has set an expample by taking advantage of data warehousing technologies to support decision making and gain success. This kind of computerized support used by Norfolk southern can be demostrated by the business pressure-reponses-support model. The business pressure-responses-support model can be divided into three components: business pressure that result from today’s business environment, actions taken by company to response the pressures and computeried support that facilitates the monitoering of the environment and promote the response actions taken by organizations. Business environment factors,including markets,consumer demands,technology and societal factors, has created opportunities and threads for organizations which then will take different actions to be competitive. These actions, facilitated by computeried DSS, include employing strategic planning, using new business model, et al. Making good decisions mean managers can better preform their roles with assessible information and computer support.There is three major managerial roles within the organizations: interpersonal, informational and decisional. Interpersonal roles allow the manager to interact with employees for organizational goals. Figurehead, leader and lasion are three roles that listed under interpersonal roles. The informational roles are the roles that a manager can create and share knowledge to organization. These roles include monitor, disseminator and spokesperson. The decisional roles involve the process of decision making by using information and include the entrepreneur, disturbance-handler, resources-allocators. To make better decision, managers take four steps which include define the problem,consturct a model that describe the real world problem,indentify possible soultions to the modeled problem and evalute the solutions and compare,choose,recommend a potnetial soultions to the problem. The high penetration of computeried system in complex and wide managerial areas has made manager awared of the importance of computeried support in decision making. Today’s computer application focuses on problem analysis and solution application. Computer decision support system benefits decision support through speedy computations, improved communcation and collabration, et al. Thus, it enables the decision maker to make better, quicker and accurate decisions. Gorry and Scott Morton have created the classical framework of computerized decision support system with two dismensions-the degree of structuredness and the type pf control. The different levels in an organization have different decision making.Decisions can be structured, semistructured and unstructured. Structured decisions are the decision at the operational level of the organization and routine tasks, such as manufacturing. Unstructured decisions are at the strategic level and have no plan. Semistructured decisions have some aspect of the problem are structured and others are unstructured. Strategic planing, management control and operational control are there elements of the framework. Strategic planning involve defining long term goals and policies for resource allocation.Management control is the efficient use of resources to accomplish organizaional goals,while operational control is the efficient and effective inplemmentation of specific tasks. To support decision making, automated decision system (ADS) is a new choice to provide solution to repetitive management problems. Take case 1 as an example, Gaint food stores apply ADS for price decision, allowing Gaint food stores to handle a large amount of data and automate pricing schemes. Type of decision

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