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Chapter 12

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142 views

Chapter 12

Uploaded by

Mhmdd Nour Alameddine
Copyright
© © All Rights Reserved
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Chapter 12

Enhancing Decision Making

6.1 Copyright © 2014 Pearson Education, Inc. publishing as Prentice


Management Information Systems
Chapter 12: Enhancing Decision Making

Learning Objectives

• Describe the different types of decisions and how the


decision-making process works.
• Explain how information systems support the activities of
managers and management decision making.
• Explain how different decision-making constituencies in an
organization use business intelligence.
• Describe the role of information systems in helping people
working in a group make decisions more efficiently.

12.2 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Decision Making and Information Systems

• Types of decisions:
– Unstructured: Decision maker must provide
judgment, evaluation, and insight to solve problem

– Structured: Repetitive and routine; involve definite


procedure for handling so they do not have to be
treated each time as new

– Semi-structured: Only part of problem has clear-cut


answer provided by accepted procedure

12.3 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Decision Making and Information Systems

• Senior managers
– Make many unstructured decisions

• Middle managers
– Make more structured decisions but these may include unstructured
components

• Operational managers, rank and file


employees
– Make more structured decisions

12.4 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

INFORMATION REQUIREMENTS OF KEY DECISION-MAKING GROUPS IN A FIRM

FIGURE 12-1 Senior managers, middle managers, operational managers, and employees have different types of decisions and
information requirements.

12.5 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Decision Making and Information Systems

• The four stages of the decision-making process


1. Intelligence
• Discovering, identifying, and understanding the problems
occurring in the organization
2. Design
• Identifying and exploring solutions to the problem
3. Choice
• Choosing among solution alternatives
4. Implementation
• Making chosen alternative work and continuing to monitor
how well solution is working

12.6 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

STAGES IN DECISION MAKING

The decision-making process is


broken down into four stages.
FIGURE 12-2

12.7 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Decision Making and Information Systems

• Information systems can only assist in some


of the roles played by managers

• Classical model of management: five


functions
– Planning, organizing, coordinating, deciding, and
controlling

12.8 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Decision support systems

• Computer system at the management level of an


organization

• Combines data, analytical tools, and models

• Supports semi-structured and unstructured


decision-making

12.9 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Data mining

• Finds hidden patterns and relationships in


large databases to infer rules

• Knowledge discovery

12.10 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Overview of a Decision-Support System (DSS)

12.11 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Components of Decision-Support Systems

• DSS database: collection of current or historical


data

• DSS software system: collection of software


tools/mathematical and analytical models

• User interface: easy interaction

12.12 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Business Intelligence in the Enterprise

• Geographic Information Systems (GIS)

• Software for analyzing and displaying data using digitized


maps

• Enhances planning and decision-making

• Use data visualization technology

12.13 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Business Intelligence Constituencies

• Group decision support systems (GDSS)


– Interactive system to facilitate solution of unstructured
problems by group
– Specialized hardware and software; typically used in
conference rooms
• Overhead projectors, display screens
• Software to collect, rank, edit participant ideas and responses
• May require facilitator and staff
– Enables increasing meeting size and increasing
productivity
– Promotes collaborative atmosphere, anonymity
– Uses structured methods to organize and evaluate ideas

12.14 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

Business Intelligence Constituencies

• ESS: decision support for senior management


– Help executives focus on important performance
information
– Balanced scorecard method:
• Measures outcomes on four dimensions:
1. Financial
2. Business process
3. Customer
4. Learning and growth

12.15 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

THE BALANCED SCORECARD FRAMEWORK

FIGURE 12-7

In the balanced scorecard framework, the firm’s


strategic objectives are operationalized along four
dimensions: financial, business process, customer,
and learning and growth. Each dimension is
measured using several KPIs.

12.16 Copyright © 2014 Pearson Education, Inc.


Management Information Systems
Chapter 12: Enhancing Decision Making

The End

12.17 Copyright © 2014 Pearson Education, Inc.

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