Decision Support System
Chapter 8
Decision Support Systems
Managers and Decision
Making
A decision refers to a choice made between alternatives.
Why Managers Need the Support of Information
Technology. It is very difficult to make good decisions without valid, timely and relevant information. Number of alternatives to be considered is increasing
Many decisions are made under time pressure.
Due to uncertainty in the decision environment, it is frequently necessary to conduct a sophisticated analysis.
It is often necessary to rapidly access remote information.
Can we make better decisions?
Decision Process
Decision makers go through a fairly systematic process.
Define
the
“Process or Problem”
Develop
Alternative
Courses of Action
Select
The “Best”
One
Review It
Act on it
The nature of decisions
Information systems can support decision-making levels. These include the three levels of management activity. Strategic management, tactical management, and operational management. Strategic management
A board of directors and an executive committee of the CEO develop longrange planning.
Decisions made at the strategic level tend to be unstructured.
Tactical management
Mid-level mangers deal with middle level management activities such as short-term planning, medium range plans and control.
Decisions made at the tactical management level tend to be semistructured.
Operational management
Operating managers deal with day-today operations of an organization, such as assigning employees to tasks, or placing or purchase an order.
Decisions made at the operational management level tend to be more structured. Structured decisions
Structured decisions are repetitive and routine problems for which standard solutions exist.
Ex: finding an appropriate inventory level, finding an optimal investment strategy. MIS primarily analyzes structured problems. Semi-structured decisions
Decision Support Systems
Managers and Decision
Making
A decision refers to a choice made between alternatives.
Why Managers Need the Support of Information
Technology. It is very difficult to make good decisions without valid, timely and relevant information. Number of alternatives to be considered is increasing
Many decisions are made under time pressure.
Due to uncertainty in the decision environment, it is frequently necessary to conduct a sophisticated analysis.
It is often necessary to rapidly access remote information.
Can we make better decisions?
Decision Process
Decision makers go through a fairly systematic process.
Define
the
“Process or Problem”
Develop
Alternative
Courses of Action
Select
The “Best”
One
Review It
Act on it
The nature of decisions
Information systems can support decision-making levels. These include the three levels of management activity. Strategic management, tactical management, and operational management. Strategic management
A board of directors and an executive committee of the CEO develop longrange planning.
Decisions made at the strategic level tend to be unstructured.
Tactical management
Mid-level mangers deal with middle level management activities such as short-term planning, medium range plans and control.
Decisions made at the tactical management level tend to be semistructured.
Operational management
Operating managers deal with day-today operations of an organization, such as assigning employees to tasks, or placing or purchase an order.
Decisions made at the operational management level tend to be more structured. Structured decisions
Structured decisions are repetitive and routine problems for which standard solutions exist.
Ex: finding an appropriate inventory level, finding an optimal investment strategy. MIS primarily analyzes structured problems. Semi-structured decisions