Decision support and business intelligence systems
decision support systems and intelligent systems and intelligent decision support system example
Decision Support and Intelligent
www.ThesisScientist.com 1Decision 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
Four different stages in decision making are
www.ThesisScientist.com 2Decision 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.
www.ThesisScientist.com 3Decision Making Stages
www.ThesisScientist.com 4Decision Support System
• 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
• The software components for decision-support systems
are a language system which enables the user to
interact with the decision-support system, a problem-
• A properly designed DSS is an interactive software-
based system planned to help decision makers and to
identify and solve problems and make decisions.
• 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
• DSS 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.
• 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.
www.ThesisScientist.com 6DSS Types of Decisions
• Structured / Programmed Decisions :
– Schedule decisions
– Organization develops specific process for handling
– Rules of decision making system are predetermined
www.ThesisScientist.com 7DSS 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
– It requires every time the user has to go through the
– Decision support systems can be built in case of
programmable decision situation.
www.ThesisScientist.com 8DSS Types of Decisions
• Semistructured Decisions:
– Some decision procedures can be specified in
advance, but not enough to lead to a definite
www.ThesisScientist.com 9Decision Support System Models
• Types of Decision Support System Models :
– Behavioural Models
– Management Science Models
– Operation Research Models
Behavioural Models Management Science Models Operation Research Models
Types of Models
www.ThesisScientist.com 10Behavioural 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.
– 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
customer’s buying behavioral).
www.ThesisScientist.com 11Management Science Models
– 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
• 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
www.ThesisScientist.com 12Operation Research Models
– Operation Research Models :
• The Operation Research models are the mathematical models in
providing guidelines to managers for making effective decisions within
the state of the current information, or in seeking further information
if current knowledge is insufficient to reach a proper decision.
• Telecommunications/Road/Rail Network Design
• Organization Supply Chain Strategy
• Just-in-Time Manufacturing Planning
• Retail Shop floor Layout
• Revenue, Pricing and Promotions
• Demand Forecasting
• Project Planning
For eg : Linear Programming is mathematical modeling technique useful
for guiding quantitative decisions in business planning, industrial
engineering, and—to a lesser extent in the social and physical sciences.
www.ThesisScientist.com 13Benefits of Decision Support System
– Benefits of Decision Support System :
• Ability to view data and sensing the problem through the
• Ability to understand and evaluate the business
• 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.
www.ThesisScientist.com 14Group Decision Support System
• 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
– GDSS has come to mean computer software and
hardware used to support group functions and
– GDSS supports Manager and Staff working in
www.ThesisScientist.com 15Group Decision Support System
• There are four configurations of group members
• 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
www.ThesisScientist.com 16GDSS Time/Place Environment
www.ThesisScientist.com 17WHY USE GDSS?
• High level managers can spend 80% of their time
making decisions in groups. Applied correctly, GDSS
can reduce this time, arriving at a better decision
• GDSS provides the hardware, software, databases and
procedures for effective decision making.
www.ThesisScientist.com 18Advantages of GDSS
• Parallel Communication – eliminate monopolizing,
providing increased participation, better decisions
• Automated record keeping – no need to take notes,
they’re automatically recorded
• Ability for virtual meetings – only need hardware,
software and people connected
• Portability - Can be set up to be portable…laptop
• Global Potential - People can be connected across
www.ThesisScientist.com 19Disadvantages of GDSS
• Cost – infrastructure costs to provide the
hardware and software/room/network
connectivity can be very expensive
• Security – especially true when companies rent
the facilities for GDSS; also, the facilitator may be
a lower level employee who may leak information
• Technical Failure – power loss, loss of
connectivity, relies heavily on bandwidth and
LAN/WAN infrastructure properly setup system
should minimize this risk