Management Information Systems

Prof. Prakash M Soni

Topic No.: 8 Management Support System Introduction

The term Management Support System refers to the application of any technology either as an independent tool or in combination with other information technology MSS is very essential due to its functionality importance as to support management task in general with Decision Support System They are collection of computer technologies that support managerial work, essentially decision making

MSS Tools
DSS Decision Support System: The process of making decisions is DSS. The emphasis is on Support rather than on automation of decision. BI Business Intelligence: Its highlighting area is better understanding of market behavior and views of business operations. It works on the tactical areas of business. GSS Group Decision Support System: It is adapted by a group of people who collaborate to support integrated systems thinking for complex decision making ES Expert System: A specific area to act as an expert consultant to users EIS Executive Support System: These are MIS, tailored to the strategic information needs of top management. It emphasis on graphical displays and easy to use interfaces for better representation of data ERP Enterprise Resource Planning: The system is designed to co-ordinate al the resources, information and activities needed to complete business

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Management Information Systems

Prof. Prakash M Soni

processes. An ERP solution is characterized by supporting a variety of business functions. SCM Supply Chain Management: It is the management of a network of inter-connected businesses involved in the ultimate provisions of product and service packages required by the end customers.

Integration of MSS
Functional Area Integration: It implies that different application are provided as a single system. It integrated two or more MIS both internally or externally within the organization Physical Area Integration: It refers to packaging the hardware, software and communication features required to accomplish functional integration.

Reasons for MSS Integration

Increasing the capabilities of the MSS Applications: DSS with ES Enhance the capabilities of Non-MSS Applications: ERP for analysis Enhancement by Intelligent Tools: ES enhance DSS with intelligent agents

Decision Making
Decision is an art of choosing an optimum alternative from a set of available alternative in the influence of the information pool regarding the environment of the decision It is the process of selection course of action to accomplish a desired result Decision making is the study of identifying and choosing alternatives based on the values and preference of the decision maker Decision making is the process sufficiently reducing uncertainty and doubt about alternatives to allow a reasonable choice to be made from among them
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Management Information Systems

Prof. Prakash M Soni

Decision making takes place in adopting the objectives and choosing the means and again when a change in the situation creates a necessity for adjustments

Types of Decision
Programmed Decisions: They are routine or structured They are repetitive or short term Definite procedure is to be followed There are laid down norms & situations are known They are taken at the lower or operating levels in an organisation Example: Inventory should be ordered when inventory levels drop to 100 units is to adhere to a rule. Non-Programmed Decisions: Innovative New or complex situations Important and Critical Strategic and Long term Example: Determining the appropriate training program

Characteristics of DSS
DSS should aid the decision maker in decision making particularly in tactical / strategic issues DSS should be able to create general purpose models, simulations capabilities and other analytical tools available to a decision maker. DSS should enable users to use DSS without assistance from MIS Professionals
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Management Information Systems

Prof. Prakash M Soni

DSS should be readily adapted to meet information requirement for any decision making environment DSS should provide mechanism to enable rapid response to a decision makers request for information DSS should have capability to interface with corporate database & flexible to accommodate variety of management styles DSS should facilitate communications between various levels of decision making Iterative methods are better advised DSS should be able to address structured and semi structured issues

Programmed & Non Programmed Decisions

Elements of Decision Making

The decision maker The decision problem or goal Attitudes, values and personal goals of the decision maker Assumptions with regards to future events and things The environment in which decision is to be taken Availability of known alternatives with significance and scope Analytical results in the whole perspective
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Management Information Systems

Prof. Prakash M Soni

The constraints The act of selection or choice Timing of decision Proper communication of decision for its effective execution

Decision Making Environment

Ambiguity: Problem is not clear, the goal is not clear and hence output is not clear Certainty: Input-Output relation is known and hence the result is known Uncertainty: Unawareness about resources, inputs & outputs so results are also unpredictable Risk: Totally unknown results in terms of profit or loss

Factors influencing Decision Making

Time pressures: The quality of decision depends on the availability of time given to the manager for taking decisions. Managers Value: The quality of decision is also based on the perception and behavior of the manager while taking a call. Decision should support objectives and based on priorities. Value judgment reflected in the alternatives chosen. Organizational Policy: Any decision taken or implemented should not against the policy framed by the organization. Managers tendency for Risk: It's an integral component of decision making process. It helps evaluating the alternatives with success ratios.

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Management Information Systems

Prof. Prakash M Soni

Decision Making Process

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Management Information Systems

Prof. Prakash M Soni

Decision Making Process: Classical Model of DSS

In this model, a manager, when confronted with a decision making situation, would collect ALL the information that is required for that activity and would take a decision which would be IN THE BEST INTERESTS OF THE ORGANISATION. In this model, a manager, when confronted with a decision making situation, would collect ALL the information that is required for that activity and would take decision which would be IN THE BEST INTERESTS OF THE ORGANISATION.

Decision Making Process: Administrative Model of DSS

In this model, the manager is concerned about himself. As and when confronted with a decision making situation, would collect WHATEVER information that is required for that activity and would take a decision which may not be in the best interests of the organization but would certainly be IN THE BEST INTERESTS OF THE MANAGER. This model is based on the observation of manager.
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Management Information Systems

Prof. Prakash M Soni

Managers rarely have all the information they need or want. They are not aware of all possible alternatives and are not able to predict consequences Organizations goals constraint decision making process Early alternatives and solutions are quickly adopted because of constraints and limitations

Decision Making Process: Herbert Simon Model of DSS

The Herbert Simons Model is related to the Decision Making Process. This model mainly describes the core of decision making process and support on wide front of the same. This model is consists of following 3 Sub-Inter related phases:

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Management Information Systems

Prof. Prakash M Soni

Intelligence Phase of HS Model

Organizational Objectives, Search and SCANNING environment, Data Collection, Problem Identification, Problem Classification, Problem Statement Social Environment: Economic, Legal and Social Environment for Operation Competitive Environment: Understands & Analysis the characteristics, trends & behavior of market Organizational Environment: Capabilities, Strengths, Weakness, Constraints & other factors which affects the operations of organization

Design Phase of HS Model

Formulate a Model Set Criteria for Choice Search for Alternatives Predict and Measure Outcomes

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Management Information Systems

Prof. Prakash M Soni

Choice Phase of HS Model:

Solution to the Model Sensitivity Analysis Selection of best (good) alternative(s) Plan for implementation (action) Design of a control system

DSS ???
It refers to a class of systems, which support the process of making decisions. The emphasis is on support rather than the automation of decision making. It allows the decision maker to retrieve data and test alternative solutions during the process of problem solving It specialized in problem identification, selecting relevant data, picking the approach to be used in decision making and evaluating the alternative courses of action. DSS as interactive computer based system, which helps decision makers utilize data and model to solve unstructured problems DSS enables the business executives t take the efficient, effective and economic decisions

Goals of DSS
Provides rapid access to information Handle large amounts of data from different sources and locations Provide report and presentation flexibility Offer both textual and graphical orientation Support drill down analysis

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Management Information Systems

Prof. Prakash M Soni

Perform complex, sophisticated analysis and comparisons using advanced software

Functions of DSS
What-If? Analysis: Change in variable and their relevant effect in decision Sensitivity Analysis: One variable changes and makes impact on overall effect of decision Goal Seeking Analysis: It sets a target value for a variable and then repeatedly changes the value of variable to meet the target value Optimization Analysis: The goal is to find the optimum value for one or more target variables at given certain constraints

Components of DSS
A Decision Support System (DSS) is an interactive computer based information system with an organized collection of models, people, procedures, software, databases, telecommunication, and devices, which helps decision makers to solve unstructured or semi-structured business problems. Components of DSS are: Hardware Resource, Software Resource, Data Resource, Model Resource, People Resource and Decision Support System Packages

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Management Information Systems

Prof. Prakash M Soni

Components of DSS

Applications of DSS
Independent Problems Interrelated Problems Organizational Problems

Benefits of DSS:
Improving personal efficiency Improving problem solving Facilitating communications Promoting learning or training Increasing organizational control

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Management Information Systems

Prof. Prakash M Soni

Limitations of DSS
DSS has definite computational constraints due to limited memories and capacity It is slow, compared to the speed of large IT automation machines Most DSS are individual based but others can link with limited access Procedures are little common to every DSS It is difficult to know interdependencies of functions provided by system It is tough to keep tracking of consequences of DSS functions usage Few aspects need deep understanding about the specific domain knowledge Usage of different data base models and data models leads translation problem Users may have to work on several decision scenarios at some time

MIS Vs. DSS

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