MANAGEMENT INFORMATION SYSTEMS 8/E

Raymond McLeod, Jr. and George Schell

Chapter 13
Decision Support Systems

13-1
Copyright 2001 Prentice-Hall, Inc.

Simons Types of Decisions

Programmed decisions
repetitive and routine
have a definite procedure

Nonprogrammed decisions
Novel and unstructured
No cut-and-dried method for handling
problem

Types exist on a continuum

13-2

Simons Problem Solving Phases

Intelligence

Design

Inventing, developing, and analyzing possible

courses of action

Choice

Searching environment for conditions calling for

a solution

Selecting a course of action from those available

Review

Assessing past choices

13-3

Definitions of a Decision Support

System (DSS)
General definition - a system providing
both problem-solving and communications
capabilities for semistructured problems

Specific definition - a system that

supports a single manager or a relatively

small group of managers working as a
problem-solving team in the solution of a
semistructured problem by providing
information or making suggestions concerning
specific decisions.
13-4

The DSS Concept

Gorry and Scott Morton coined the phrase

DSS in 1971, about ten years after MIS
became popular
Decision types in terms of problem structure
Structured problems can be solved with
algorithms and decision rules
Unstructured problems have no structure in
Simons phases
Semistructured problems have structured and
unstructured phases

13-5

The Gorry and Scott Morton Grid

Management levels
Operational
control
Structured

Degree of
problem
structure
Semistructured

Unstructured

Management
control

Strategic
planning

Accounts
receivable

Budget analysis-engineered costs

Tanker fleet
mix

Order entry

Short-term
forecasting

Warehouse and
factory location

Inventory
control
Production
scheduling

Variance analysis-overall budget

Mergers and
acquisitions

Cash
management

Budget
preparation

New product
planning

PERT/COST
systems

Sales and
production

R&D planning
13-6

Alters DSS Types

In 1976 Steven Alter, a doctoral

student built on Gorry and ScottMorton framework
Created a taxonomy of six DSS types
Based on a study of 56 DSSs

Classifies DSSs based on degree of

problem solving support.

13-7

Levels of Alters DSSs

Level of problem-solving support

from lowest to highest

Retrieval of information elements

Retrieval of information files
Creation of reports from multiple files
Estimation of decision consequences
Propose decisions
Make decisions

13-8

Importance of Alters Study

Supports concept of developing

systems that address particular
decisions
Makes clear that DSSs need not be
restricted to a particular application
type

13-9

Alters DSS Types

Retrieve
information
elements

Little

Analyze
entire
files

Prepare
reports
from
multiple
files

Estimate
decision
consequences

Degree of
complexity of the
problem-solving
system

Propose
decisions

Make
decisions

Degree
of
problem
solving
support

Much
13-10

Three DSS Objectives

1.
Assist in solving
semistructured problems
2.
Support, not replace, the
manager
3.
Contribute to decision
effectiveness, rather than
efficiency
Based on studies of Keen and Scott-Morton
13-11

A DSS Model
Environment
Individual
problem
solvers

Report
writing
software

Other
group
members

GDSS
GDSS
software
software

Mathematical
Models

Database

Decision
support
system
Environment
Legend:

Data

Communication

Information

13-12

Database Contents

Used by Three Software Subsystems

Report writers
Special reports
Periodic reports
COBOL or PL/I
DBMS

Mathematical models
Simulations
Special modeling languages

Groupware or GDSS

13-13

Group Decision Support Systems

Computer-based system that supports

groups of people engaged in a common
task (or goal) and that provides an
interface to a shared environment.
Used in problem solving
Related areas
Electronic meeting system (EMS)
Computer-supported cooperative work (CSCW)
Group support system (GSS)
Groupware

13-14

How GDSS Contributes

to Problem Solving

Improved communications
Improved discussion focus
Less wasted time

13-15

GDSS Environmental
Settings

Synchronous exchange
Members meet at same time
Committee meeting is an example

Asynchronous exchange
Members meet at different times
E-mail is an example

More balanced participation.

13-16

GDSS Types

Decision rooms

Local area decision network

Members interact using a LAN

Legislative session

Small groups face-to-face

Parallel communication
Anonymity

Large group interaction

Computer-mediated conference

Permits large, geographically dispersed group

interaction
13-17

Group Size and Location Determine

GDSS Environmental Settings
GROUP SIZE
Face-toface

MEMBER
PROXIMITY
Dispersed

Smaller

Larger

Decision
Room

Legislative
Session

Local Area
Decision
Network

ComputerMediated
Conference
13-18

Groupware

Functions
E-mail
FAX
Voice messaging
Internet access

Lotus Notes
Popular groupware product
Handles data important to managers

13-19

Main Groupware Functions

IBM
TeamWARE Lotus
Function
Workgroup Office
Notes
Electronic mail
X
X
X
FAX
X
X
O
Voice messaging
O
Internet access
X
X
O
Bulletin board system
X
3
Personal calendaring
X
X
3
Group calendaring
X
X
O
Electronic conferencing
O
X
3
Task management
X
X
3
Desktop video conferencingO
Database access
O
X
3
Workflow routing
O
X
3
Reengineering
O
X
3
Electronic forms
O
3
3
Group documents
O
X
X
X = standard feature

O = optional feature

Novell
GroupWise
X
X
X
X
O
X
X
3
X

X
O
O

3 = third party offering

13-20

Artificial Intelligence (AI)

The activity of providing such
machines as computers with the
ability to display behavior that
would be regarded as intelligent if
it were observed in humans.

13-21

History of AI

Early history

John McCarthy coined term, AI, in 1956, at

Dartmouth College conference.
Logic Theorist (first AI program. Herbert
Simon played a part)
General problem solver (GPS)

Past 2 decades

Research has taken a back seat to MIS and

DSS development
13-22

Areas of Artificial Intelligence

Expert
systems

AI
hardware
Robotics

Natural
language

Learning

Neural
networks

Perceptive
systems
(vision,
hearing)

Artificial Intelligence
13-23

Appeal of Expert Systems

Computer program that codes the

knowledge of human experts in
the form of heuristics
Two distinctions from DSS
1. Has potential to extend managers
problem-solving ability
2. Ability to explain how solution was
reached

13-24

User

Instructions &
information

Solutions &
explanations

Knowledge

User
interface

Inference
engine

Expert
system

Development
engine

Expert and
knowledge engineer

Knowledge
base

Problem
Domain

An Expert
System Model
13-25

Expert System Model

User interface

Knowledge base

Allows user to interact with system

Houses accumulated knowledge

Inference engine
Provides reasoning
Interprets knowledge base

Development engine

Creates expert system

13-26

User Interface

User enters:
Instructions
Information

Menus, commands, natural language, GUI

Expert system provides:

Solutions
Explanations of

Questions
Problem solutions

13-27

Knowledge Base

Description of problem domain

Rules
Knowledge representation technique
IF:THEN logic
Networks of rules

Lowest levels provide evidence

Top levels produce 1 or more conclusions
Conclusion is called a Goal variable.

13-28

A Rule Set That Produces One Final

Conclusion
Conclusion

Conclusion

Evidence

Evidence

Conclusion

Evidence

Evidence

Evidence

Evidence

Evidence

Evidence
13-29

Rule Selection

Selecting rules to efficiently solve a

problem is difficult
Some goals can be reached with only
a few rules; rules 3 and 4 identify
bird

13-30

Inference Engine

Performs reasoning by using the

contents of knowledge base in a
particular sequence
Two basic approaches to using rules
1. Forward reasoning (data driven)
2. Reverse reasoning (goal driven)

13-31

Forward Reasoning
(Forward Chaining)

Rule is evaluated as:

(1) true, (2) false, (3) unknown

Rule evaluation is an iterative

process
When no more rules can fire, the
reasoning process stops even if a
goal has not been reached
Start with inputs and
work to solution
13-32

Rule 1
IF A
THEN B

Rule 2
IF C
THEN D

Rule 3
IF M
THEN E

Rule 4
IF K
THEN F

Rule 5
IF G
THEN H

Rule 6
IF I
THEN J

The Forward
Reasoning
Process

T
Rule 7
F

IF B OR D
THEN K

T
Rule 8
IF E
THEN L

Rule 10
IF K AND
L THEN N

Rule 12
IF N OR O
THEN P

Legend:
Rule 9

IF
IF(F
(FAND
ANDH)
H)
OR
ORJJ
THEN
THENMM
T

Rule 11
IF M
THEN O

First pass

T
Second pass

Third pass

F
13-33

Reverse Reasoning Steps

(Backward Chaining)
Divide problem into subproblems
Try to solve one subproblem
Then try another

Start with solution

and work back to
inputs
13-34

Step 4
Rule 1
IF A THEN
B
T

Rule 2

Step 3
Rule 7
IF B OR D
THEN K

IF C
THEN D

The First Five Problems

Are Identified
Step 2
Rule 10
IF K AND L
THEN N

Step 5
Rule 3

IF N OR O
THEN P

Rule 8

IF M
THEN E

IF E
THEN L
Rule 11

Rule 9
13-35

Step 1
Rule 12

IF (F AND H)
OR J
THEN M

IF M
M
IF
THEN O
THEN
O

Legend:
Problems to
be solved

The Next Four Problems Are Identified

Step 8

If N Or O
Then P T

Rule 4

If K
Then F
Rule 5

Step 9

If G
Then H

Rule 6

If I
Then J

Rule 12

Step 7

Step 6

IF (F And H)
Or J
Then M T

If M
Then O

Rule 9

Rule 11

Legend:
Problems to
be solved

13-36

Forward Vs Reverse Reasoning

Reverse reasoning is faster than

forward reasoning
Reverse reasoning works best under
certain conditions

Multiple goal variables

Many rules
All or most rules do not have to be examined
in the process of reaching a solution

13-37

Development Engine

Programming languages
Lisp
Prolog

Expert system shells

Ready made processor that can be

tailored to a particular problem domain

Case-based reasoning (CBR)

Decision tree
13-38

Expert System Advantages

For managers
Consider more alternatives
Apply high level of logic
Have more time to evaluate decision rules
Consistent logic
For the firm
Better performance from management
team
Retain firms knowledge resource
13-39

Expert System Disadvantages

Cant handle inconsistent

knowledge
Cant apply judgment or intuition

13-40

Keys to Successful ES
Development

Coordinate ES development with strategic

planning
Clearly define problem to be solved and
understand problem domain
Pay particular attention to ethical and legal
feasibility of proposed system
Understand users concerns and
expectations concerning system
Employ management techniques designed to
retain developers
13-41

Neural Networks

Mathematical model of the human

brain

Simulates the way neurons interact

to process data and learn from
experience

Bottom-up approach to modeling

human intuition
13-42

The Human Brain

Neuron -- the information processor

Input -- dendrites
Processing -- soma
Output -- axon

Neurons are connected by the

synapse

13-43

Simple Biological Neurons

Soma
(processor)

Axonal Paths
(output)

Synapse
Axon

Dendrites
(input)

13-44

Evolution of Artificial
Neural Systems (ANS)

McCulloch-Pitts mathematical
neuron function (late 1930s) was the
starting point
Hebbs learning law (early 1940s)
Neurocomputers
Marvin Minskys Snark (early 1950s)
Rosenblatts Perceptron (mid 1950s)

13-45

Current Methodology

Mathematical models dont duplicate

human brains, but exhibit similar
abilities
Complex networks
Repetitious training

ANS learns by example

13-46

Single Artificial Neuron

y1

w1

y2

w2

y3

w3

wn-1
yn-1

13-47

OUT1

OUTn

The Multi-Layer
Perceptron

Input
Layer

Y1

Yn2

OutputL
ayer

IN1

INn

13-48

Knowledge-based Systems
in Perspective

Much has been accomplished in

neural nets and expert systems
Much work remains
Systems abilities to mimic human
intelligence are too limited and
regarded as primitive
13-49