mcnurlin - 7th edition - chapter 11

1、Supporting Decision Making Chapter 11Information Systems Management In Practice 7EMcNurlin & SpraguePowerPoints prepared by Michael MatthewVisiting Lecturer, GACC, Macquarie University Sydney Australia1Part IV: Systems for Supporting Knowledge-Based WorkThis part consists of three chapters that disc

2、uss supporting three kinds of work decision making, collaboration, and knowledge workAs shown in the books framework figure, we distinguish between procedure-based and knowledge-based information-handling activities The two previous chapters, in Part III, dealt mainly with building systems for proce

3、dure-based workThis part focuses on supporting knowledge-based activities: the systems that support people in performing information-handling activities to solve problems, work together, and share expertise 2006 Barbara C. McNurlin. Published by Pearson Education.22006 Barbara C. McNurlin. Published

4、 by Pearson Education.3Part IV: Systems for Supporting Knowledge-Based Work cont.Chapter 11 discusses supporting decision making by first presenting five underlying technologies and some examples of their use:Decision Support Systems (DSS)Data MiningExecutive Information Systems (EIS), and Expert Sy

5、stems (ES)Agent-based Modelling The chapter then discusses the fascinating subject of the real-time enterprise, which has a goal of gaining competitive edge by learning of an event as soon as possible and then responding to that event quickly, if necessary 2006 Barbara C. McNurlin. Published by Pear

6、son Education.4Part IV: Systems for Supporting Knowledge-Based Work cont.Chapter 12 deals with supporting collaboration byFirst describing various kinds of groupsDifferent systems that support their collaboration, and Finally how executives might think about managing virtual organizations an increas

7、ing phenomenon these daysChapter 13 discusses supporting knowledge work by presenting a model for thinking about how to manage knowledgeIt ends with a discussion of computer ethics and intellectual capital issues in this Internet era 2006 Barbara C. McNurlin. Published by Pearson Education.5Chapter

8、11This lecture / chapter discusses technologies for supporting decision making:Decision Support Systems (DSS) Data MiningExecutive Information Systems (EIS), and Expert SystemsAgent-based ModellingIt then discusses IT issues related to creating the real-time enterprise Case examples include: a probl

9、em-solving scenario, Ore-Ida Foods, a major services company, Harrahs Entertainment, Xerox Corporation, General Electric, American Express, Delta Air Lines, a real-time interaction on a website, and Western Digital2006 Barbara C. McNurlin. Published by Pearson Education.6IntroductionMost computer sy

10、stems support decision making because all software programs involve automating decision steps that people would takeDecision making is a process that involves a variety of activities, most of which handle informationA wide variety of computer-based tools and approaches can be used to confront the pr

11、oblem at hand and work through its solution 2006 Barbara C. McNurlin. Published by Pearson Education.7A PROBLEM-SOLVING SCENARIOCase Example Supporting Decision MakingUsing an executive information system, (EIS) to compare budget to actual sales Discover a sale shortfall in one region Searches for t

12、he cause of the shortfallBut couldnt find an answer2006 Barbara C. McNurlin. Published by Pearson Education.8A PROBLEM-SOLVING SCENARIOCase Example Supporting Decision Making cont.Investigate several possible causesEconomic Conditions through the EIS & the Web accesses:Wire servicesBank economic new

13、slettersCurrent business and economic publicationsCompetitive Analysis through the same sources investigates whether competitors:Have introduced a new productHave launched an effective ad campaignWritten Sales Report browses the reports“Concept based” text retrieval system makes this easierA Data Mi

14、ning AnalysisLooking for any previously unknown relationships2006 Barbara C. McNurlin. Published by Pearson Education.9A PROBLEM-SOLVING SCENARIOCase Example Supporting Decision Making cont.Then accesses a marketing DSS includes a set of models to analyze sales patterns by:ProductSales representativ

15、eMajor customerResult no clear problems revealed.Action hold a meeting, in an electronic meeting room supported by group DSS (GDSS) softwareThis scenario illustrates:The wide variety of activities involved in problem solving, andThe wide variety of technologies that can be used to assist decision ma

16、kers and problem solvers2006 Barbara C. McNurlin. Published by Pearson Education.10Technologies that Support Decision MakingThe purpose of tractors, engines, machines etc. = to enhance humans physical capabilitiesThe purpose of computers has been to enhance our mental capabilitiesHence, a major use

17、of IT is to relieve humans of some decision making or help us make more informed decisions 2006 Barbara C. McNurlin. Published by Pearson Education.11Technologies that Support Decision Making Decision Support SystemsSystems that support, not replace, managers in their decision-making activitiesDecis

18、ion modeling, decision theory, and decision analysis, attempt to make models from which the best decision can be derived, by computationDSS are defined as: Computer-based systemsThat help decision makersConfront ill-structured problemsThrough direct interactionWith data and analysis modelsWide range

19、 of technologies can be used to assist decision makers and problem solvers12Decision Support Systems The Architecture for DSSsFigure 11-1 shows the relationship between the three components of the DDM modelSoftware system in the middle of the figure consists of:The database management system (DBMS)T

20、he model base management system (MBMS)The dialog generation and management system (DGMS)2006 Barbara C. McNurlin. Published by Pearson Education.132006 Barbara C. McNurlin. Published by Pearson Education.14Decision Support Systems The Architecture for DSSs cont.The Dialog ComponentThe DSS contains a

21、 dialog component to link the user to the systemWas mouse (Mac) now = browser interfaceThe Data ComponentData sources as the importance of DSS has grown, it has become increasingly critical for the DSS to use all the important data sources within and outside the organizationData warehousingData mini

22、ngMuch of the work on the data component of DSS has taken the form of activities in this areaThe Model ComponentModels provide the analysis capabilities for a DSSUsing a mathematical representation of the problem, algorithmic processes are employed to generate information to support decision making2

23、006 Barbara C. McNurlin. Published by Pearson Education.15Decision Support Systems Types of DSSThe size and complexity of DSS range from large complex systems that have many of the attributes of major applications down to simple ad hoc analyses that might be called end user computing tasksInstitutio

24、nal DSSs tend to be fairly well definedThey are based on pre=defined data sourcesHeavily internal with perhaps some external dataUse well established models in a prescheduled wayQuick-hit DSSs are developed quickly to help a manager make either a one-time decision or a recurring oneCan be every bit

25、as useful for a small or large companyMost today = Excel spreadsheets (and not called DSS)16ORE-IDA FOODSCase Example Institutional DSSFrozen food division of H.J. HeinzMarketing DSS must support 3 main tasks in the decision making process:Data retrieval helps managers find answers to the question,

26、“what has happened?”Market analysis addresses the question, “Why did it happen?”Modeling helps managers get answers to, “What will happen if?”Modeling for projection purposes, offers the greatest potential value of marketing managementFor successful use line managers must take over the ownership of

27、the models and be responsible for keeping them up-to-date2006 Barbara C. McNurlin. Published by Pearson Education.17A MAJOR SERVICES COMPANYCase Example “Quick Hit” DSS Short Analysis ProgramsConsidering new employee benefit program: an employee stock ownership plan (ESOP). Wanted a study made to de

28、termine the possible impact of the ESOP on the company and to answer such questions as:How many shares of company stock will be needed in 10,20 and 30yrs to support the ESOP?What level of growth will be needed to meet these stock requirements?The information systems manager wrote a program to perfor

29、m the calculations & printed the resultsResults = showed the impact of the ESOP over a 30yr periodSurprising results2006 Barbara C. McNurlin. Published by Pearson Education.18Technologies that Support Decision Making Data MiningA promising use of data warehouses is to let the computer uncover unknow

30、n correlations by searching for interesting patterns, anomalies, or clusters of data that people are unaware existCalled data mining, its purpose is to give people new insights into data Also covered in Chapter 7Most frequent type of data mined = customer data19HARRAHS ENTERTAINMENTCase Example Data

31、 Mining (Customer)To better know its customers, Harrahs encourages them to sign up for its frequent-gambler card, Total RewardsHarrahs mined its Total Rewards database to uncover patterns and clusters of customersIt has created 90 demographic clusters, each of which is sent different direct mail off

32、ers encouraging them to visit other Harrahs casinosProfit and loss for each customer calculating the likely return for every investment it makes in that customer 2006 Barbara C. McNurlin. Published by Pearson Education.20HARRAHS ENTERTAINMENTCase Example Data Mining (Customer) cont.Much of its $3.7B

33、 in revenues (and 80% of its profits) comes from its slot machines and electronic gaming-machine playersFound = locals who played oftenIt was not the high rollers who were the most profitableWithin the first two years of operation of Total Rewards, revenue from customers who visited more than one Ha

34、rrahs casino increased by $100 million2006 Barbara C. McNurlin. Published by Pearson Education.21Technologies that Support Decision Making Executive Information Systems (EIS)As the name implies EISs are for use by executivesThey have been used for the following purposes:Gauge company performance: sa

35、les, production, earnings, budgets, and forecastsScan the environmental: for news on government regulations, competition, financial and economics developments, and scientific subjects22Technologies that Support Decision Making Executive Information Systems (EIS) cont.EIS can be viewed as a DSS that:

36、Provides access to summary performance dataUses graphics to display and visualize the data in an easy-to-use fashion, and Has a minimum of analysis for modeling beyond the capability to “drill down” in summary data to examine componentsIn many companies, the EIS is called a dashboard and may look li

37、ke a dashboard of a car23XEROX CORPORATIONCase Example Executive Information SystemThe EIS at Xerox began small and evolved to the point where even skeptical users became avid supportersIts objective was to improve communications and planning, such as giving executives pre-meeting documentsIt was al

38、so used in strategic planning and resulted in better plans, especially across divisions 2006 Barbara C. McNurlin. Published by Pearson Education.24Executive Information Systems (EIS) Pitfalls in EIS DevelopmentLack of executive support: executives must provide the funding, but are the principal user

39、s and supply the needed continuityUndefined system objectives: the technology, the convenience, and the power of EIS are impressive, but the underlying objectives and business values of an EIS must be carefully thought throughPoorly defined information requirements: EIS typically need non - traditio

40、nal information sources - judgments, opinion, external text-based documents - in addition to traditional financial and operating data25Inadequate support staff: support staff must:Have technical competenceUnderstand the business, and Have the ability to relate to the varied responsibilities and work

41、 patterns of executivesPoorly planned evolution: highly competent system professionals using the wrong development process will fail with EISEIS are not developed, delivered, and then maintainedThey should evolve over a period of time under the leadership of a team that includes:The executive sponso

42、rThe operating sponsorExecutive usersThe EIS support staff manager, and The IS technical staffExecutive Information Systems (EIS) Pitfalls in EIS Development cont.26Executive Information Systems (EIS)Why Install an EIS?Attack a critical business need: EIS can be viewed as an aid to dealing with impo

43、rtant needs that involve the future health of the organizationA strong personal desire by the executive: The executive sponsoring the project mayWant to get information faster than he/she is now getting it, or Have a quicker access to a broader range of information, or Have the ability to select and

44、 display only desired information and to probe for supporting detail, or To see information in graphical form27Executive Information Systems (EIS) A Weak Reason to Install an EIS“The thing to do”: An EIS is seen as something that modern management must have, in order to be current in management prac

45、ticesThe rationale given is that the EIS will increase executive performance and reduce time that is wasted looking for information and by such things as telephone tag28Executive Information Systems (EIS) What Should the EIS Do?A Status Access System: Filter, extract, and compress a broad range of u

46、p-to-date internal and external informationIt should call attention to variances from plan. It should also monitor and highlight the critical success factors of the individual executive userEIS is a structured reporting system for executive management, providing the executive with the data and infor

47、mation of choice and desired form29GENERAL ELECTRICCase Example Executive Information System Most senior GE executives have a real-time view of their portion of GE via an executive dashboardEach dashboard compares expected goals (sales, response times, etc) with actual, alerting the executive when g

48、aps of a certain magnitude appearGEs goal is to gain better visibility into all its operations in real time and give employees a way to monitor corporate operations quickly and easilyThe system is based on complex enterprise software that interlinks existing systemsGEs actions are also moving its pa

49、rtners and business ecosystem closer to real-time operation 2006 Barbara C. McNurlin. Published by Pearson Education.30Technologies that Support Decision Making Expert SystemsA real-world use of artificial intelligence (AI)AI is a group of technologies that attempts to mimic our senses and emulate c

50、ertain aspects of human behavior such as reasoning and communicationPromising for 40 years +. Now = finally living up to promiseAn expert system is an automated type of analysis or problem-solving model that deals with a problem the way an “expert” doesNote: Expert Systems are not newLISPPrologLangu

51、ages in the 70s31Technologies that Support Decision Making Expert Systems cont.The process involves consulting a base of knowledge or expertise to reason out an answer based on the characteristics of the problemLike DSSs, they have:A user interfaceAn inference engine, and Stored expertise (in the fo

52、rm of a knowledge base)The inference engine is that portion of the software that contains the reasoning methods used to search the knowledge base and solve the problem 32Expert SystemsKnowledge RepresentationKnowledge can be represented in a number of ways:One is as cases; case-based reasoning exper

53、t systems using this approach draw inferences by comparing a current problem (or case) to hundreds or thousands of similar past casesA second form is neural networks, which store knowledge as nodes in a network and are more intelligent than the other forms of knowledge representation because they ca

54、n learnThird, knowledge can be stored as rules (the most common form of knowledge representation), which are obtained from experts drawing on their own expertise, experience, common sense, ways of doing business, regulations, and laws 2006 Barbara C. McNurlin. Published by Pearson Education.332006 B

55、arbara C. McNurlin. Published by Pearson Education.34AMERICAN EXPRESSCase Example Expert SystemOne of the first commercially successful ESs and a fundamental part of the companys everyday credit card operationAuthorizers Assistant is an expert system that approves credit at the point of saleIt has o

56、ver 2,600 rules and supports all AmEx card products around the worldAuthorizes credit by looking at:Whether cardholders are creditworthyWhether they have been paying their billsWhether a purchase is within their normal spending patternsIt also assesses whether the request for credit could be a poten

57、tial fraud2006 Barbara C. McNurlin. Published by Pearson Education.35AMERICAN EXPRESSCase Example Expert System cont.The most difficult credit-authorization decisions are still referred to peopleAvoids sensitive transactionsRestaurantsAirline queuesThe rules were generated by interviewing authorizer

58、s with various levels of expertise comparing good decisions to poor decisionsThe system can be adapted quickly to meet changing business requirements 2006 Barbara C. McNurlin. Published by Pearson Education.36Expert SystemsDegree of ExpertiseAs an assistant, the lowest level of expertise, the expert

59、 system can help a person perform routine analysis and point out those portions of the work where the expertise of the human is requiredAs a colleague, the second level of expertise, the system and the human can “talk over” the problem until a “joint decision” has been reachedAs an expert, the highe

60、st level of expertise, the system gives answers that the user accepts, perhaps without question2006 Barbara C. McNurlin. Published by Pearson Education.37Agent Based ModellingA simulation technology for studying emergent behaviour (e.g. traffic jam) that emerges from the decisions of a large number