CHAPTER 11 MANAGERS AND DECISION MAKING Management is a process by which an organization achieves its goals through the use

se of resources Three basic roles - Interpersonal roles: figurehead, leader, liaison - Informational roles: monitor, disseminator, spokesperson, analyzer - Decisional roles: entrepreneur, disturbance handler, resource allocator, negotiator

The decision-making process composed of three major phases

- Organizational objectives - Search and scanning procedures - Data collection - Problem identification - Problem statement

1) Intelligence, which manager examine a situation and identify the problem

2) Design: decision makers construct a model that a model that simplifies the problem. - Formulate a model (assumption) - Set criteria for choice - Search for alternatives - Predict and measure outcomes

3) Choice: involve selecting a solution, which is tested on paper - Implemented the decision - Solution to the model - Sensitivity analysis - Selection of best (good) alternative Why Managers Need IT Support -The number of alternatives is increasing - Compares alternatives to help decision making - Decision must be made under time pressure - need fast and effective - Increase uncertainties in the decision environment, decisions become complex - Necessary to conduct a sophisticated analysis in order to make a good decision - It helps organization to bring information and decision maker together with less cost Two major dimensions of decisions: Problem structure & the nature of the decision Problem structure - Structured decisions involve routine and repetitive problems for which standard solutions exist, such as inventory control - Unstructured decision is complex and not cut-and-direct solutions. The nature of decisions - Operational control: executing specific tasks efficiently and effectively - Plan for implementation (action) - Design of a control system

- Management control: acquiring and using resources efficiently in accomplishing organizational goals - Strategic planning: the long-range goals and policies for growth and resource allocation Business intelligence refers to applications and technologies for consolidating, and providing access to vast amounts of data to help users make better business and strategic decisions. 1) Provide data analysis tools (multi-dimensional data analysis, data mining, and decision support systems 2) Provide easily accessible information in a structure format (digital dashboard) Corporate Performance management is a BI application consists in monitoring and managing an organizations performance according to key performance indicators such as revenue, ROI, overhead, and operational costs. Multi-dimensional Data Analysis (on-line analytical processing) is the process of performing complex, multi-dimensional analyses of data stored in a data base or data warehouse, typically using graphical software tools. - Provide user an excellent view of what is happening or what has happened Data Mining refers to the process of searching for valuable business information in a large data base, data warehouse, or data mart with the intent of identify in a business opportunity in order to create a sustainable competitive advantage. 1) Predicting trends and behavior - target marketing 2) Identifying previously unknown patterns - unrelated product that are often purchase 2gether Retails: Predicting sales, preventing theft and fraud, and determining correct inventory levels Banking: Forecasting levels of bad loans and fraudulent credit card use Decision Support Systems (DSS) combine models and data in an attempt to solve semi-structured and some unstructured problems - GDSS, which assists a particular group within an organization - ODSS focuses on an organizational tasks or activity that involves a sequence of operations and decision makers - Sensitivity analysis enables the system to adapt to changing conditions and to varying requirements of different decision-making situations - What-if Analysis attempts to predict the impact of a change in the assumption (input data) on the proposed solution - Goal-Seeking Analysis attempt to find the value of the inputs necessary to achieve a desired level of output

Digital Dashboards provides rapid access to timely information and direct access to management reports. It enables managers to examine exception reports and drill-down reports. Geographic Information System (GIS) is a computer-based system for capturing, integrating, manipulating, and displaying data using digitized maps. - Every record or digital object has an identified geographical location called geocoding. - Enables users to generate information for planning, problem solving, and decision making - easy for managers to visualize the data

Virtual Reality as interactive, computer-generated, three-dimensional graphics delivered to the user through a head-mounted display Intelligent system describes the various commercial applications of artificial intelligence Artificial intelligence is a subfield of computer science that is concerned with studying the thought processes of humans and recreating the effects of those process via machines, such as computer and robots

Expert System is a computer system that attempts to mimic human experts by applying expertise in a specific domain. can either Support or Replace them Natural Languages Understanding (speech recognition), allows a computer to comprehend spoken instructions given in the users every language -Easy to use -Faster than type - manual freedom

Neural Networks is a system of programs and data structures that simulates the underlying concepts of the human brain Fuzzy Logic is a branch of mathematics that deals with uncertainties by simulating the process of human resonning.