Basic of MIS, DSS, Problem Solving Process in DSS, Functional Aspects of MIS, Intelligence Stage of Decision Making,

1. MIS & DSS
Dr. Kamal Gulati
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2. Management Information Systems and
Decision Support Systems

3. Problem Solving Process In DSS
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
Intelligence Phase
Design Phase
Choice Phase

REALITY
Implementation
of the Solution
SUCCESS
FAILURE
Testing of Proposed
Solutions
Verification
of the Model
Monitoring

4. Decision Making
Decision making attributes:
 Intelligence
 Design
 Choice
Problem Solving attributes:
 Decision making
 Implementation
 Monitoring
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5. Decision Making Levels
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Characteristics Operational
decisions
Tactical
decisions
Strategic
decisions
Time period
affected
Short term Intermediate
term
Long term
Frequency Frequently Not so often Rare
Structure of
problems
Structured Semistructured Unstructured
Source of
information
Mostly internal Internal and
External
Mostly external
Degree of
detail
Detailed
information
Mainly
summarized
information
Summarized
information

6. Structured vs. Unstructured Problems
•Structured problem requires programmed
decision based on a known rule, formula or
procedure
•Unstructured problem requires non-
programmed decision based on the individual
knowledge and expertise.
•Semi structured problem requires combination
of both types of decisions
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7. Programmed vs. Non-programmed
Decisions
• Programmed decisions
• Decision made using a rule, procedure, or quantitative method
• Easy to computerize using traditional information systems
• Non-programmed decisions
• Decision that deals with unusual or exceptional situations
• Not easily quantifiable
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8. Management Information Systems
• Provide routine information to managers in the functional areas
• MIS inputs:
• Come from TPS
• Internal databases
• External databases
• MIS outputs – various reports
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9. MIS outputs
•Routine, scheduled report – is produced periodically
•Key-indicator report – a summary of previous day
critical activities
•Demand (ad hoc) report – is developed at a
person’s request
•Exception report – is automatically produced when
a situation is unusual
•Drill-down report – provides increasingly detailed
information
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10. Functional Aspects of MIS
• Financial MIS
• Manufacturing MIS
• Marketing MIS
• Customer relationship management
• Human resource MIS
• Accounting MIS
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11. Intelligence Stage of Decision Making
• Initial stage in which potential problems or opportunities are
defined:
• Evaluation of information
• Qualitative analysis
• Quantitative analysis
• Interpretation – Is there is a problem (opportunity)
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12. Design Stage of Decision Making
• Second stage of decision making
• Alternative solutions to the problem are developed:
• Formulate a model
• Set up criteria for a choice
• Search for alternatives
• Evaluate outcomes
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13. Models
A model is a simplified representation of reality
Models classification:
 Mental model is a narrative description of reality
 Iconic (scale) model is a physical replica of a system,
which is based on a different scale from original
 Analog model - a physical model, but the shape of
the model differs from that of the actual system
 Mathematical (quantitative) model describes a real
system based on mathematical formulas and
constructs
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14. Mathematical Models
• Model variables – investigated characteristics of real world
system
• Parameters – represent internal and external conditions
• Managerial decisions are reflected in model’s initial values and
parameters
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15. Mathematical models
• Analytical models
• Simulation models:
• Advanced math. techniques
• Computational methods
• Computational algorithms
• IT support
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16. Another Classification of the Models
• Optimization model
• allows to find the best solutions
• Satisficing model
• Allows to find good, but not always best solution
• Heuristic – commonly accepted guideline or procedure
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17. Model Investigation
• Model validation
• Stability analysis – model reaction to small disturbances in initial
values
• Sensitivity analysis – model reaction to small disturbances in
parameters values
• Simulation experiments
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18. Simulation experiments
• What-if analysis – checks the consequences of possible solution
• Goal-seeking analysis – attempts to find inverse solution:
• Not every model has inverse solutions
• Computational algorithms based on series of direct simulations must be
used
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19. Choice Stage of Decision Making
• Requires selecting a course of actions
• Include steps:
• Selection of best (good) alternative
• Plan for implementation
• Design a control system
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20. A Framework for Computerized Decision
Support
• Structured problem – all stages are structured
• Semi structured problem – not all stages are structured
• Unstructured problem – all stages are unstructured, require intuition
and knowledge
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21. Requirements for DSS
•Support all problem-solving phases
•Support different decision frequencies
•Support different problem structures
•Support various decision-making levels
•Support several interdependent and/or
sequential decisions
•Utilize models or complex computations
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22. Type of Data Processing
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Decision Support
Data Driven
Decision Support
Model Driven
Decision Support
OLAP, data
mining
Models

23. Components of DSS
• DSS is an information system
• DSSs are supported on the software level
• Database (including management component)
• Model base (including management component)
• Dialogue manager (User interface)
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24. Decision Support Systems
• Individual DSSs:
• Functional analysts
• Low-level managers
• Group Decision Support Systems (GDSS):
• Groups of managers
• Top-level managers
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25. Comparison of DSS and MIS
Factor DSS MIS
Problem Type Semistructured
and unstructured
Structured
Goal Help to make a
decision
Provide
information in a
timely manner
Users Decision makers Organizational
employees
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26. Comparison of DSS and MIS (cont…)
Factor DSS MIS
User’s
involvement
Select or construct
models, plan
experiments
Very little or none
Scope Process of
decision making
Information
Output Interactive, is
displayed on the
screen
Soft and hard
copies of reports
are generated
Type of
processing
Online processing Hybrid processing
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