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MTS 482

01/2016

Course Introduction
Week 1
Asst.Prof.Dr. Pisit Chanvarasuth

Whats this course about?


Understand todays turbulent business environment and
describe how organizations survive and even excel in such an
environment
Understand the need for computerized support of managerial
decision making
Understand an early framework for managerial decision making
Learn the conceptual foundations of the decision support
systems (DSS) methodology
Describe the business intelligence (BI) methodology and
concepts and relate them to DSS
Describe the concept of work systems and its relationship to
decision support
List the major tools of computerized decision support
Understand the major issues in implementing computerized
support systems

Introduction

Instructor: Asst.Prof.Dr. Pisit Chanvarasuth


Office Location: Sirindhralai Building, 4 th Fl.
Office Telephone: (02) 501-3505-20 x 6004
E-mail Address: pisit@siit.tu.ac.th
NOTE: All e-mail must have the following
subject: DSS, your name, and the topic

COURSE MATERIALS
Business Intelligence and Analytics: Systems for Decision
Support, Sharda, R., Delen, D., and Turban, E., Pearson,
10th Edition, 2014.
Introduction to Management Science: A Modeling and
Case Studies Approach with Spreadsheets, Hillier, F.S.,
Hillier, M.S., Schmedders, K., and Stephens, M., McGraw
Hill, 5th Edition, 2014.
Articles from several sources, such as material on
Various WEB sites
Other readings will be distributed in class.
Note: Class lectures often contain information not found
in the readings. Attending class and taking notes are
factors for good performance in this course.

CLASS OPERATION FORMAT


The following variety of formats will be employed
Class Lecture
Class Discussion
Lab
Group or Individual Assignments, Research and
Presentations.

COURSE
REQUIREMENTS:

1. Exams
2 times
Midterm Examination
Final Examination

2. Group Project
Team of 5 students
The term project can either be a term research paper on
a specialized DSS or BI topic(s) and issue(s) or a design
and development of a basic yet useful DSS or BI
prototype application using a commercially available
vendor product.
Students should start working on the project as soon as
possible so as to attain the desired quality and to be
able to finish the project by the end of the semester . You
are expected to make a presentation of your groups
analysis during the last week of class. In addition, you
are also expected to submit a written report.

3. Class Participation
Class time will be devoted to lectures, Lab., and
presentation, demonstrations of DSS topics, and
open discussion concerning how decision
support systems may be used to help an
organization compete
Contrary to popular belief, my job is not merely
to impart information to you, but to help you
learn.
Your participation is extremely important to the
learning process for yourself and the entire
class. Consequently, class attendance and
participation are strongly encouraged.

4. Lab Session
Each student is expected to attend the lab
session.
There will be either an individual or a group lab
assignments assigned for each lab session.
Students are expected to complete all
assignments and submit it within the time
assigned.

Format
Grading
Group Project
Lab. Exams/Quiz/Assignments
Class Participation
2 Exams
Exam I: 35%
Exam II: 35%

10%
15%
5%
70%

Group Project

Project Proposal due: Week 7


Final Report due: on the Presentation Day
Final Presentation Week 16

Tentative Course
Schedule

Week

Topics

Preparation

Course Introduction
-Course Objective
-Grading Policy
-Course Content & Schedule
Chapter 1
-Course Project
An Overview of Business Intelligence, Analytics,
and Decision Support

Foundations and Technologies for Decision


Making

Chapter 2

Data Warehousing

Chapter 3

Business Reporting, Visual Analytics, and


Business Performance Management

Chapter 4

Data Mining

Chapter 5

Techniques for Predictive Modeling

Chapter 6

Review Session

Project Proposal DUE

Mid-term Examination (October 4, 2016)

Week

Topics

Preparation

Text Analytics, Text Mining, and Sentiment


analysis

Chapter 7

10

Web Analytics, Web Mining, and Social Analytics

Chapter 8

11
12

Model-Based Decision Making: Optimization and


Chapter 9
Multi-Criteria Systems
Modeling and Analysis: Heuristics Search Methods
Chapter 10
and Simulation

13

Automated Decision Systems and Expert Systems

Chapter 11

14

Knowledge Management and Collaborative


Systems

Chapter 12

15

Big Data and Analytics

Chapter 13

16

Project Presentation

Project Report DUE

17

Final Examination (December 13, 2016)

Introduction
An Overview of
Business Intelligence,
Analytics, and
Decision Support

Changing Business Environments


and Computerized Decision
Support
Companies are moving aggressively to
computerized support of their operations
Business Intelligence
Business PressuresResponsesSupport Model
Business pressures result of today's
competitive business climate
Responses to counter the pressures
Support to better facilitate the process

Business Pressures
ResponsesSupport Model

The Business Environment


The environment in which organizations
operate today is becoming more and
more complex, creating
opportunities, and
problems.
Example: globalization.

Business environment factors:


markets, consumer demands, technology,
and societal

Business Environment Factors


FACTOR
Markets

DESCRIPTION
Strong competition
Expanding global markets
Blooming electronic markets on the Internet
Innovative marketing methods
Opportunities for outsourcing with IT support
Need for real-time, on-demand transactions
Consumer
Desire for customization
demand
Desire for quality, diversity of products, and speed of delivery
Customers getting powerful and less loyal
Technology
More innovations, new products, and new services
Increasing obsolescence rate
Increasing information overload
Social networking, Web 2.0 and beyond
Societal
Growing government regulations and deregulation
Workforce more diversified, older, and composed of more women
Prime concerns of homeland security and terrorist attacks
Necessity of Sarbanes-Oxley Act and other reporting-related legislation
Increasing social responsibility of companies
Greater emphasis on sustainability

Organizational Responses
Be Reactive, Anticipative, Adaptive, and
Proactive
Managers may take actions, such as

Employ strategic planning.


Use new and innovative business models.
Restructure business processes.
Participate in business alliances.
Improve corporate information systems.
more [in your book]

Closing the Strategy Gap


One of the major objectives of
computerized decision support is to
facilitate closing the gap between the
current performance of an organization
and its desired performance, as
expressed in its mission, objectives, and
goals, and the strategy to achieve them.

Managerial Decision Making


Management is a process by which
organizational goals are achieved by
using resources.
Inputs: resources
Output: attainment of goals
Measure of success: outputs / inputs

Management Decision Making


Decision making: selecting the best
solution from two or more alternatives

The Nature of Managers Work


Mintzberg's 10 Managerial Roles
Interpersonal
1. Figurehead
2. Leader
3. Liaison

Informational
4. Monitor
5. Disseminator
6. Spokesperson

Decisional
7. Entrepreneur
8. Disturbance handler
9. Resource allocator
10. Negotiator

Decision-Making Process
Managers usually make decisions by
following a four-step process (a.k.a. the
scientific approach)
1.
2.
3.
4.

Define the problem (or opportunity)


Construct a model that describes the realworld problem.
Identify possible solutions to the modeled
problem and evaluate the solutions.
Compare, choose, and recommend a
potential solution to the problem.

Managerial Decision
Making
Decision support systems (DSS)
A conceptual framework for a process of
supporting managerial decision- making,
usually by modeling problems and
employing quantitative models for
solution analysis

Information Systems Support


for Decision Making

Group communication and collaboration


Improved data management
Managing data warehouses and Big Data
Analytical support
Overcoming cognitive limits in processing
and storing information
Knowledge management
Anywhere, anytime support

An Early Decision Support


Framework (by Gory and Scott-Morten, 1971)

An Early Decision Support


Framework
Degree of Structuredness (Simon, 1977)
Decisions are classified as
Highly structured (a.k.a. programmed)
Semi-structured
Highly unstructured (i.e., nonprogrammed)

Types of Control (Anthony, 1965)


Strategic planning (top-level, long-range)
Management control (tactical planning)
Operational control

The Concept of DSS


DSS - interactive computer-based systems,
which help decision makers utilize data and
models to solve unstructured problems
(Gorry and Scott-Morton, 1971)

Decision support systems couple the intellectual


resources of individuals with the capabilities of
the computer to improve the quality of
decisions.
DS as an Umbrella Term
Evolution of DS into Business Intelligence

The Concept of Decision


Support Systems (DSS)

The Concept of Decision


Support Systems (DSS)
Types of DSS
model-oriented DSS: quantitative models used to
generate a recommended solution to a problem
data-oriented DSS: support ad-hoc reporting and
queries

A Framework for
Business Intelligence (BI)
BI is an evolution of decision support
concepts over time
Then: Executive Information System
Now: Everybodys Information System (BI)

BI systems are enhanced with additional


visualizations, alerts, and performance
measurement capabilities
The term BI emerged from industry

Definition of BI
BI is an umbrella term that combines
architectures, tools, databases, analytical tools,
applications, and methodologies
BI is a content-free expression, so it means
different things to different people
BI's major objective is to enable easy access to
data (and models) to provide business managers
with the ability to conduct analysis
BI helps transform data, to information (and
knowledge), to decisions, and finally to action

A Brief History of BI
The term BI was coined by the Gartner
Group in the mid-1990s
However, the concept is much older
1970s - MIS reporting - static/periodic reports
1980s - Executive Information Systems (EIS)
1990s - OLAP, dynamic, multidimensional, ad-hoc
reporting -> coining of the term BI
2010s - Inclusion of AI and Data/Text Mining
capabilities; Web-based Portals/Dashboards, Big Data,
Social Media, Analytics
2020s - yet to be seen

The Evolution of BI Capabilities

The Architecture of BI
A BI system has four major components
a data warehouse, with its source data
business analytics, a collection of tools for
manipulating, mining, and analyzing the data
in the data warehouse
business performance management (BPM)
for monitoring and analyzing performance
a user interface (e.g., dashboard)

A High-Level Architecture of BI

Business Value of BI Analytical


Applications

Customer segmentation
Propensity to buy
Customer profitability
Fraud detection
Customer attrition
Channel optimization

DSS-BI Connections
Similarities and differences?
Similar architectures, data focus,

Direct vs. indirect support


Different target audiences
Commercially available systems versus
in-house development of solutions
Origination Industry vs. Academia
So, is DSS = BI ?

A Framework for
Business Intelligence (BI)

The DSS-BI connection


1. The architecture is very similar since BI
evolved from DSS
2. DSS are constructed to directly support
specific decision making; BI systems are
geared to provide accurate and timely
information (indirect support)
3. BI has an executive and strategy orientation
while DSS has been oriented toward analysts

A Framework for
Business Intelligence (BI)

The DSS-BI connection


4. BI systems are constructed with commercially
available tools and components that are fitted
to the needs of organizations; DSS more
programming is used to construct custom
solutions to very unstructured problems
5. DSS were developed mostly in the academic
world; BI were developed mostly by software
companies
6. Many tools used by BI are also considered
DSS tools (e.g., data mining and predictive
analysis )

Analytics Overview
Analytics?
Something new or just a new name for
A Simple Taxonomy of Analytics (proposed by
INFORMS)
Descriptive Analytics
Predictive Analytics
Prescriptive Analytics
Analytics or Data Science?

Analytics Overview

A Framework for
Business Intelligence (BI)
Styles of BI
1.
2.
3.
4.
5.

Report Delivery and Alerting


Enterprise Reporting (dashboard, scorecard)
Cube Analysis (Slice and Dice Analysis)
Ad-hoc Query
Statistics and Data Mining

A Framework for
Business Intelligence (BI)

Management support systems (MSS)


A system that applies any type of decision
support tool or technique to managerial
decision-making

A Work System
View of Decision Support
Work system
A system in which human participants
and/or machines perform a business
process using information, technology,
and other resources to produce products
and/or services for internal or external
customers

A Work System
View of Decision Support

Nine elements of a work system


1.
2.
3.
4.
5.
6.
7.
8.
9.

Business process
Participants
Information
Technology
Product and services
Customers
Infrastructure
Environment
Strategy

The Major Tools and Techniques


of Managerial Decision Support
Computerized Tools for Decision Support
Data management
Reporting status
tracking
Visualization
Business analytics
Strategy and
performance
management

Communication and
collaboration
Knowledge
management
Intelligent systems
Enterprise systems

The Major Tools and Techniques


of Managerial Decision Support
Tools-Web connection
All of these tools are available in both webbased and non web-based formats

Hybrid (integrated) support systems


A support system that uses several tools
and techniques to assist management in
solving managerial or organizational
problems and assess opportunities and
strategies

Implementing Computer-Based
Managerial Decision Support
Systems
Developing or acquiring support systems
Justification and cost-benefit analysis
Security and protection of privacy
Integration of systems and applications
The Web in DSS/BI implementation
Information portals and MSS

Introduction to Big Data


Analytics
Big Data?
Not just big!
Volume
Variety
Velocity
More of Big Data and related analytics tools
and techniques are covered in Chapter 13.

End of the Chapter

Questions / Comments