Chapter 7

Management Support Systems

 Management Support in Business

 Companies are investing in data-driven decision

support application frameworks to help them
respond to
 Changing market conditions
 Customer needs…

 This is accomplished by several types of

 Management information
 Decision support
 Other information systems
Levels of Managerial Decision Making
Decision Structure
 Structured (operational)
 The procedures to follow when decision is
needed can be specified in advance
 Semi-structured (tactical)
 Decision procedures can be pre-specified,
but not enough to lead to the correct decision
Unstructured (strategic)
 It is not possible to specify in advance most
of the decision procedures to follow
Business Processes and Information Systems
 Business processes:
 Manner in which work is organized,
coordinated, and focused to produce a valuable
product or service
 Concrete work flows of material,
information,
and knowledge— sets of activities
 Unique ways to coordinate work, information,
 and
Waysknowledge
in which management chooses to
coordinate work
 Examples of Business Processes
 Manufacturing and production:
• Assembling product, checking quality, producing bills of
materials
 Sales and marketing:
• Identifying customers, creating customer awareness,
selling
 Finance & accounting:
• Paying creditors, creating financial statements, managing
cash accounts
 Human resources:
• Hiring employees, evaluating performance, enrolling
employees in benefits plans
Business Processes and Information Systems
• Information technology enhances
business processes in two main ways:
• Increasing efficiency of existing processes
• Automating steps that were manual
• Enabling entirely new processes that are
capable of transforming the businesses
• Change flow of information
• Replace sequential steps with parallel
• steps
Eliminate delays in decision making
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
 Different Kinds of Systems
 Three main categories of information
systems serve different organizational levels:
1. Operational-level systems: support
operational managers, keeping track of the
elementary activities and transactions
2. Management-level systems: serve the
monitoring, controlling, decision-making,
and administrative activities
3. Strategic-level systems: help senior
management tackle and address strategic
issues
 Major Types of Systems
• Transaction Processing Systems (TPS)

• Management Information Systems (MIS)

• Decision-Support Systems (DSS)

• Executive Support Systems (ESS)

The Four Major Types of Information Systems
 Transaction Processing Systems (TPS)
• Basic business systems that serve the
operational level

• A computerized system that performs

and records the daily routine
transactions necessary to the conduct of
the business
A Symbolic Representation for a Payroll TPS
Typical Applications of TPS
Management Information Systems (MIS)

• Inputs: High volume transaction level data

• Processing: Simple models
• Outputs: Summary reports
• Users: Middle managers

Example: Annual budgeting

Management Information Systems (MIS) (cont.)
Management Information Systems (MIS) (cont.)
A sample MIS report
 Decision-Support Systems (DSS)

• Inputs: Transaction level data

• Processing: Interactive
• Outputs: Decision analysis
• Users: Professionals, staff
Example: Contract cost analysis
Decision-Support Systems (DSS) (Continued)
Voyage-estimating decision-support system
 Decision Support Systems

Management Information Decision Support Systems

Systems

Decision support Provide information about the Provide information and

provided performance of the organization techniques to analyze specific
problems

Information form Periodic, exception, demand, and Interactive inquiries and

and frequency push reports and responses responses

Information format Pre-specified, fixed format Ad hoc, flexible, and adaptable

format

Information Information produced by extraction Information produced by

processing and manipulation of business data analytical modeling of business
methodology data
 Executive support systems
 Support senior management
 Address non-routine decisions requiring
judgment, evaluation, and insight
 Incorporate data about external events (e.g. new
tax laws or competitors) as well as summarized
information from internal MIS and DSS
 Example: ESS that provides minute-to-minute
view of firm’s financial performance as
measured by working capital, accounts
receivable, accounts payable, cash flow, and
inventory
EXECUTIVE SUPPORT SYSTEMS (ESS):

• Inputs: Aggregate data

• Processing: Interactive
• Outputs: Projections
• Users: Senior managers
 Example: 5 year
operating plan
Model of a Typical Executive Support System
This system pools data from
diverse internal and
external sources and makes
them available to executives
in easy-to-use form.
EXECUTIVE SUPPORT SYSTEMS (ESS) (Cont.)

Top Level Management

Designed to the individual senior
manager
Ties CEO to all levels
Very expensive to keep up
Extensive support staff
EXECUTIVE SUPPORT SYSTEMS (ESS) (Cont.)
Relationship of Systems to One Another
Interrelationships among systems
 Executive Information Systems

 Combines many features of MIS and DSS

 Provide top executives with immediate
and
easy access to information

 Identify factors that are critical to

accomplishing strategic objectives
(critical success factors)
 Features of an EIS

 Information presented in forms tailored to

the preferences of the executives using the
system
 Customizable graphical user interfaces
 Exception reports
 Trend analysis
 Drill down capability
 Artificial Intelligence (AI)
 AI is a field of science and
technology based
on
 Computer science, Biology, Psychology
 Linguistics, Mathematics, Engineering
 The goal is to develop computers that can
simulate the ability to think and see, hear,
walk, talk, and feel as well

Q: Can Machine Think???

 Attributes of Intelligent Behavior
 Some of the attributes of intelligent behavior
 Think and reason
 Use reason to solve problems
 Learn or understand from experience(Data)
 Acquire and apply knowledge
 Exhibit creativity and imagination
 Deal with complex or perplexing situations
 Respond quickly and successfully to new situations
 Recognize the relative importance of elements in a
situation
 Handle ambiguous, incomplete, or erroneous
information
Domains of Artificial Intelligence
 Cognitive Science
 Applications in the cognitive science of AI
 Expert systems
 Knowledge-based systems
 Adaptive learning systems
 Fuzzy logic systems
 Neural networks
 Genetic algorithm software
 Intelligent agents
 Focuses on how the human brain works
and how humans think and learn
 Robotics
 engineering, and physiology are the basic
disciplines of robotics
 Produces robot machines with computer intelligence
and humanlike physical capabilities
 This area include applications designed to
give robots the powers of
 Sight or visual perception
 Touch
 Dexterity
 Locomotion
 Navigation
 Natural Interfaces
o Major thrusts in the area of AI and the
development of natural interfaces
 Natural languages
 Speech recognition
 Virtual reality
o Involves research and development in
 Linguistics
 Psychology
 Computer science
 Other disciplines
 Expert Systems
 An Expert System (ES)
 A knowledge-based information system
 Contain knowledge about a specific,
complex application area
 Acts as an expert consultant to end
users
 The system can reason, diagnose
problems and offer remedies
 Components of an Expert System
 Knowledge Base
 Facts about a specific subject area
 Heuristics that express the reasoning procedures of
an
expert (rules of thumb)
 Software Resources engine processes the knowledge
 An inference
and recommends a course of action
 User interface programs communicate with
the end user
 Explanation programs explain the reasoning process
to
the end user
 Methods of Knowledge Representation

 Case-Based
 Knowledge organized in the form of cases
 Cases are examples of past performance,
occurrences, and experiences
 Frame-Based
 Knowledge organized in a hierarchy or
network of frames
 A frame is a collection of knowledge about
an entity, consisting of a complex package
 Methods of Knowledge Representation
 Object-Based
 Knowledge represented as a network of objects
 An object is a data element that includes both data
and the methods or processes that act on those data
 Rule-Based
 Knowledge represented in the form of rules and
statements of fact
 Rules are statements that typically take the
form of a premise and a conclusion (If, Then)
 Expert System Application Categories
 Decision Management
 Loan portfolio analysis
 Employee performance evaluation
 Insurance underwriting
 Diagnostic/Troubleshooting
 Equipment calibration
 Help desk operations
 Medical diagnosis
 Software debugging
 Expert System Application Categories

 Design/Configuration
 Computer option installation
 Manufacturability studies
 Communications networks
 Selection/Classification
 Material selection
 Delinquent account identification
 Information classification
 Suspect identification
 Expert System Application Categories

 Process Monitoring/Control
 Machine control (including robotics)
 Inventory control
 Production monitoring
 Chemical testing
 Benefits of Expert Systems
 Captures the expertise of an expert or
group of experts in a computer-based
information system
 Faster and more consistent than an expert
 Can contain knowledge of multiple experts
 Does not get tired or distracted
 Cannot be overworked or stressed
 Helps preserve and reproduce the knowledge
of human experts
 Limitations of Expert Systems
 The major limitations of expert
systems
 Limited focus
 Maintenance problems
 Development cost
 Can only solve specific types of problems
in a limited domain of knowledge
 Developing Expert Systems
 Suitability Criteria for Expert Systems
 Domain: the domain or subject area of the problem is small
and well-defined
 Expertise: a
body of
 knowledge,
techniques, and
intuition is
 needed that only a few people possess
Complexity: solving the problem is a complex task that
requires logical inference processing
 Structure: the solution process must be able to cope with
ill-structured, uncertain, missing, and conflicting data and a
changing problem situation
The Information Systems Function in
Business
• Information systems department:
• Formal organizational unit responsible for
information technology services
• Includes programmers, systems analysts, project
leaders, information systems managers
• Often headed by chief information officer
(CIO), also includes chief security officer (CSO)
and chief knowledge officer (CKO)
• End-users:
• Representatives of other departments, for whom
applications are developed
Organization of the Information Systems Function

There are alternative ways of organizing the information systems function within the business:
within each functional area.
Organization of the Information Systems Function

B: A separate department under central control

Organization of the Information Systems Function

C: Represented in each division of a large multidivisional company but under centralized

control
CHAPTER EIGHT

INFORMATIO SYSTEM
N DEVELOPMEN
S
T

IS Dev't 1
Participants in the System Development

IS Dev't 3
Systems Analyst

Responsible for
designing and
developingsystem
information

Liaison between users

and IT professionals

IS Dev't 4
Project Team

Formed to work on project from beginning to end

Consists of users, systems analyst, and other IT professionals

Project leader—one member of the team who

manages and controls project budget and schedule

IS Dev't 5
Project Management

 Process of planning, scheduling, and controlling

activities during system development cycle
 Project leader identifies elements for project

Goal, objectives, and

expectations, Time estimates for each
Required activities
collectively called activity
scope

Cost estimates for each Activities that can take

activity Order of activities place at same time

IS Dev't 6
Gantt Chart
 Popular tool used to plan and schedule time
relationships among project activities

IS Dev't 7
Feasibility Study

Organiztional
Measure of feasibility
how Four
suitable feasibil
system ity Schedule
developmen tests:
feasibility

t will be to
the Economic Technical
feasibility feasibility
company (also
called
cost/benefi
t
feasibility)
IS Dev't 9
Documentation

Collection and summarization

of data and information
Includes reports, diagrams,
programs, and other deliverables

Project notebook contains all

documentation for single
project

IS Dev't 10
Data and Information Gathering Techniques

 Review documentation
 Observe
 Questionnaire
 Interview
 Joint-application
design (JAD) session
(client or end user in the design)

4/29/2018 IS Dev't 11
What Initiates the System Development?

What are some reasons to create or modify an

information system?

To correct
problem To improve
in existing existing
system system
Outside
Competition
group may
can
mandate
lead to
change change

IS Dev't 13
The System Development Cycle

What are the phases of the system development cycle?

IS Dev't 15
The System Development Cycle
What are the phases of the system development cycle?
Phase 2. Analysis
 Conduct preliminary
Phase 1. Planning investigation Phase 3. Design
 Review project requests  Perform detailed
analysis activities  Acquire hardware and
 Prioritize project requests
 Study current system software, if necessary
 Allocate resources  Develop details of
 Determine-user
 Identify project
requirements system
development
team  Recommend
solution

Phase 5. Support Phase 4. Implementation

 Conduct post-  Develop programs, if necessary
implementation system
review  Install and test new system
 Identify errors and  Train users
enhancements  Convert to new system
 Monitor system

performance
IS Dev't 16
Planning Phase

What is the planning phase?

Begins when steering committee receives project request

Steering committee—decision-
making body for the company

Function of committee:

Review and Prioritize Form project

Allocate development
approve project
project
resource team for each
requests
requests s approved
project
IS Dev't ) 17
Analysis Phase/Feasibility Study

What is the analysis phase?

Conduct preliminary Perform detailed

investigation, also analysis
called feasibility
study

IS Dev't 18
Analysis Phase

What is the preliminary investigation?

 Determine exact nature of problem or
improvement
and whether it is worth pursuing
 Findings are presented in feasibility report, also known as a feasibility
study

8 IS Dev't 19
Analysis Phase

What is detailed analysis?

1. Study how current
system works

2. Determine user’s
wants, needs, and
requirements
3. Recommend
solution

Sometimes called logical

design
IS Dev't ) 20
Analysis Phase

What is the
system proposall?
Assesses
feasibilit
y
of each
alternative
solution

Recommends
the most P sented to steering
feasible r mmittee, which
solution for e cides how system
the project ill be developed
c
IS Dev't
o 21
Analysis Phase

What are possible solutions? Horizontal market

software—meets
needs of many
Buy packaged software— companies
prewritten software
available for purchase
Vertical market
software—designed
Write own custom for particular industry
software—software
developed at user’s
request

Outsource—have outside
source develop software

IS Dev't 22
Analysis Phase

What is an example of outsourcing?

 Using Internet solutions provider
 Internet solutions provider provides Web
hosting services

4/29/2018 IS Dev't By Gebre S.(Asst. Prof) 23

Design Phase

What is the design phase?

Acquire hardware and software

Develop all details of new or modified

information system

IS Dev't 24
Design Phase

What is a detailed design?

Detailed design specifications for components in proposed
solution

Sometimes called physical design

Includes several activities

Database Input and Program

design output design
design

IS Dev't 25
Design Phase

What is a prototype?

Working model of
proposed system

Rapid application development

(RAD)
 Process of developing
applications with prototypes

IS Dev't 28
Design Phase

What is computer-aided software engineering (CASE)?

 Software tools designed to support activities of
system
development cycle
Graphics—
diagrams,
Project specifications,
repository—Stores Prototyping—Creates
Enables
descriptions, programs, models of proposed
drawing of system
and other deliverables
diagrams
Code generators—Create actual
Quality assurance—Analyzes
computer programs from design
deliverables for accuracy
specifications

Housekeeping—Establishes user accounts

and provides backup and recovery
functions

IS Dev't 29
Design Phase

What is a structured walkthrough?

Step-by-step review by
Used to review detailed
project team and users
design specifications
of any system
before they are given
development
to programming team
cycle deliverable

Used throughout entire

Identifies any errors
system development
and allows IT
cycle to review a
personnel to correct
variety of deliverables
them

IS Dev't 30
Implementation Phase

What is the implementation phase?

 Purpose is to construct, or build, new or modified
system and then deliver it to users
Convert to new
system

Train users

Install and test new system

Develop programs

IS Dev't 31
Implementation Phase

What is the program development cycle?

 Programmers write
programs from Analyze
requirements
specifications
 Follows six steps Document Design
solution solution

Test
solution Validate
design

Implement
design

IS Dev't 32
Implementation Phase

What are the three types of tests performed by

system developers?

Unit Test Systems test

Verifies each Verifies all
individual programs in
program works by application work
itself together

Integration
Test
Verifies application
works with other
applications

IS Dev't 33
Implementation Phase

What is training?
 Showing users exactly
how they will use new
hardware and software
in system

IS Dev't 34
Implementation Phase

What are conversion strategies?

 Used to change from old system to new system

IS Dev't 35
Support Phase
What is the support phase?
 Provides ongoing assistance after system is implemented

Conduct post-implementation system review—meeting to

find out if information system is performing according to
expectations

Identify errors

Identify enhancements

Monitor system performance

IS Dev't 38
 Traditional Waterfall SDL
C

One phase
begins when
another
completes, little
backtracking
and looping

1-40 © 2005 by Prentice Hall

40
 Problems with Waterfall Approach
System requirements “locked in” after being
determined (can't change)
Limited user involvement
(only in requirements
phase), resulting in a
system that do not match
users’ needs.
phases leading to the detriment of sound
Too much focus
development on milestone deadlines of
practices
SDLC
Gives too design
Extensive
1-41
41
 Alternatives to Traditional Waterfall
SDL
Struc
Structured C
Analysis and Structured Design
Prototyping
CASE tools
Joint Application (JAD
Design )
Rapid Application Development (RAD)
Agile Methodologies
eXtreme Programming
1-43 © 2005 by Prentice Hall 43
 Agile Methodologies
Motivated by recognition of software
develop
development as fluid, unpredictable, and
dynamic
Three
Three key principles
 Adaptive rather than predictive
 Emphasize people rather than roles

 Self-adaptive processes

1-51 © 2005 by Prentice Hall 51

 Structured Analysis and Structured Design
Designed to address some of the problems with the
traditional SDLC
Uses tools . like data flow diagrams and transform
analysis to improve the analysis and design phase of
SDLC
Makes it easier to go back to earlier phases in the
lifecycle, for example when requirements change.
Targeted to reduce maintenance time, cost, and effort.
Makes a clear distinction between logical design and
physical design.

1-44 © 2005 by Prentice Hall 44

 Prototyping
Iterative development process:
Requirements quickly converted to a working
system
System is continually revised
Close collaboration between users and analysts
Advantages:
It involves the user in analysis and design, in a
larger extent.
Its ability to capture requirements in concrete,
rather than verbal or abstract, form,
1-45 © 2005 by Prentice Hall
45
 CASE Tools
Computer-Aided Software Engineering
Software tools providing automated support
for systems development
Project dictionary/workbook: system
description and specifications
descri
Diagramming tools
Example products: Oracle Designer, Rational
Rose

1-47 © 2005 by Prentice Hall 47

 Joint Application Design
(JAD)
Structur
Structured process involving users, analysts,
and managers
Several-day
Several- intensive workgroup sessions
Purpose: to specify or review system
requirements

1-48 © 2005 by Prentice Hall 48

 Rapid Application Development
(RAD)
Methodology to decrease design and
implementation time.
Involves prototyping, JAD CAS tools, and code
:generators , E

1-49 © 2005 by Prentice Hall 49

 eXtreme Programming
Short, incremental development cycles
Aut
Automated tests
Two-
Two-person programming teams
Coding
Coding and testing operate together
Advantages:
 Communication between developers
 High level of productivity

 High-quality code

1-52 © 2005 by Prentice Hall 52

Rational Unified Process (RUP) involves an iterative,
incremental approach to systems development

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54
Thank you