Decision support system

Decision Support System

Decision Making :
Information is used to make decisions. Decision making is not a
single
activity that takes place all at one. The process consists of several different
activities
that take place at different times. The decision maker has to identify and
understand
problems. Once perceived, solutions must be designed; once solutions are
designed,
choices have to be made about a particular solution; finally, the solution has to
be
carried out and implemented. Four different stages in decision making are
intelligence,
design, choice and implementation.
The model has four phases / stages:
Intelligence
Design
Choice
Implement

Decision Support System

The design support system basically helps the information system in the intelligence
phase to identify the problem and then go to the design phase for solution. The
choice of selection criteria varies from problem to problem. It is required to go
through these phase again and again till the satisfactory solution is found.

Decision Support System

Decision Support System

n

A decision-support system is an integrated set of computer tool that allows a

decision- maker to interact directly with computers to create information and it
useful in making semi-structured and unstructured decisions.

The software components for decision-support systems are a language system

which enables the user to interact with the decision-support system, a problemprocessing system.

Decision Support System (DSS) is a computer-based information system that

supports business and organizational decision-making activities.

A properly designed DSS is an interactive software-based system planned to

help decision makers and to identify and solve problems and make decisions.
Decision support system helps in making a decision.

Decision Support System

DSS serve the management, operations, and planning levels of an organization

and help to make decisions, which may be rapidly changing and not easily
specified in advance.

Decision Support System is a general term for any computer application that
increases a person or groups ability to make decisions.

Decision Support Systems are used to collect data, analyze and shape the data
that is collected, and make sound decisions or construct strategies from
analysis
whether computers, databases, or people are involved generally it does not
matter.
n

The nature of the decision is such that the decision makers need a variety of
information.
The reason for changing the demands is also because the methods of decision
making a change from time to time.
The model has four phases / stages:

Intelligence
Design
Choice

Decision Support System

Types of decisions :

Structured / Programmed Decisions :

Schedule decisions
Organization develops specific process for handling
Rules of decision making system are predetermined

Decision Support System

Types of decisions :
Unstructured / Non-programmed Decisions :
Repetitive decisions
Handled by general problem solving process
Decision taken by Decision Support Systems
Rules of decision making system are not fixed or predetermined
It requires every time the user has to go through the decisionmaking cycle.
Decision support systems can be built in case of programmable
decision situation.

Decision Support System

n

Types of Decision Support System:

q
q

q
q
q

Communication-based DSS
Data-based DSS
n
Access data systems (Information analysis systems)
n
Data analysis systems
Document-based DSS
Knowledge-based DSS
Model-based DSS
n
Accounting models
n
Representation models
n
Suggestion models

Communication-based DSS :
q Main purpose are to help conduct a meeting and collaboration between two
or more people (i.e. group of users to collaborate).
q

The examples are chatting, instant messaging software and online

collaboration and net-meeting systems.
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Decision Support System

Data-based DSS :
It is mostly used by managers, staff and also product / service suppliers. It is used
to query a database or data warehouse (a database designed to store data in
such a way that to allow for its querying and analysis by users) to seek specific
answers for specific purposes.
Examples: computer-based databases that have a query system to check
including the corporation of data to add value to existing database.

Information Analysis System :

That provide access to a sequence of decision-oriented databases.
Information from several files, tables are combined.
The information from one file, table can be combined with information from
other files to answer a specific query.

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Decision Support System

Data Analysis System :

That support the manipulation of data by computerized tools
customized to a specific task.
Allow data to manipulate capabilities.

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Decision Support System

Document-based DSS :
This is the most common type of DSS and targeted at a broad support of users. It
is useful when search web pages and find documents on a specific keywords.
A Document Driven DSS model uses a variety of documents such as text
documents and database records to come up with decisions as well as further
manipulate the information to improve the strategies.
The three primary forms of data used in document driven DSS are:
Oral (i.e. orally conversations)
Written (i.e. reports, memos, e-mail and other correspondence)
Video (i.e. TV commercials and news reports)

Examples of document-driven tools can be found in Internet search engines,

designed to separate through vast numbers of unsorted data through the use of
keyword searches.

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Decision Support System

Knowledge-based DSS :
Knowledge-driven DSS or 'knowledgebase' category covering a broad range of
systems, covering users within the organization.
for example, consumers of a business. It is essentially used to provide
management advise or to choose products / services.
Model-based DSS :
Model-based support systems incorporate the ability to manipulate data to
generate statistical and financial reports, as well as simulation models, to aid
decision-makers. Model-based decision support systems can be extremely useful
in forecasting the effects of changes in business processes, as they can use past
data.
Accounting Models :

Use Accounting data

Provide accounting models capacity
Can not handle uncertainty
That calculate the consequences (effect) of possible actions.
Use Bill of Material
Make pricing decisions
Calculate Cost
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Decision Support System

Representation Models :
To solve decision problem using forecast (estimate).
Used to expand the capabilities of Accounting Models.
Use the demand data to forecast next years demand.
That estimate the consequences of actions on the basis of models.

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Decision Support System

Suggestion Models :
Use the system to recommend the decision.
That performs to a specific suggested decision for a fairly structured or wellunderstood task.
For eg: Applicant applies for a personal loan.

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Decision Support System

Types of Decision Support System Models / Tools:
Behavioural Models
Management Science Models
Operation Research Models
DSS

Behavioural Models

Management Science Models

Operation Research Models

Types of Tools / Models

Behavioural Models :
The decision maker can make the decisions for such behavioral relationships.
For eg. :The trend (development) analysis, forecasting and statistical analysis
models.
The trend analysis indicates how different variables behave in trend setting
in the past and hence in future.
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Decision Support System

A regression model shows the correlation between one or more variables. It
helps in identifying the variables. (for forecasting )
For eg. : 1) The sale of two wheelers can be forecasted with the use of
regression model.
2) bodyweight can be estimated with the help of food in-take.
i.e. Y = C + R . X
Where,
C is a constant;
R is a regression coefficient
X is a extra cost
Y = 600 + 0.6X
In Market Research method, they can forecast or judge the behavior of the
customers buying decisions. (i.e. The questionnaire are designed and
computerized to evaluate customers buying behavioral).

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Decision Support System

Management Science Models :
These models are developed on the principles of the business management,
accounting and economics.
For eg. : the budgetary systems, cost accounting system, inventory
management system.
In the budgetary system, budgets are used for planning and control.
In all the organization, budgets are prepared with the use of graphical
representation in the form of line charts or bar charts.
For eg. : Sales Budget, Production Budget.

Operation Research Models :

The Operation Research models are the mathematical models which gives
the feasible solutions by satisfying the constraints .
For eg. : Linear Programming

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Decision Support System

Benefits of Decision Support System :

Ability to view data / information and sensing the problem through the
different view.
Ability to understand and evaluate the business performance.
Ability to understand the problem and its result, and ability to judge the
impact on business.
Ability to evaluate the impact of any change in the business performance and
enabling to focus on the areas where impact is negative.
Ability to view the complex scenario or problem and to analyze it and develop
alternatives to solve the problem.
Ability to make a better decisions due to quick analysis.
Ability to control the risk exposure in decisions.

All these abilities together make a decision maker, a capable person to handle any
complex business scenario or problem. Manager through DSS, builds capability to
execute the decision-making process Intelligent Design Choice Implement built by
Herbert Simon.

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Group Decision Support System

Information technology supports decision-making where there is a group
participation. Such decision support system is called as Group Decision Support
Systems (GDSS).
There are four configurations of group members are possible.
Group members in one room operating on network with common display
screen to share the display for all members.
Group members sit at their respective locations and use their desktop to
interact with other members.
Group members are in different cities and they come together through
teleconferencing or video conferencing with prior planning GDSS
operations.
Group members are at remote locations may be in different countries and
they come together through long distance telecommunication network.
In all four configurations, GDSS support software is available on server for members
to use. In all the configuration models, the group members work together in a
collaborative manner.
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