Fundamentals of Information Systems, Second Edition 1 Information and Decision Support Systems Chapter 6.

Fundamentals of Information Systems, Second Edition

1

Information and Decision Support Systems

Chapter 6


2

Learning Objectives

– Define the stages of decision making.– Discuss the importance of

implementation and monitoring in problem solving.


3

Learning Objectives

– Define the term MIS and clearly distinguish the difference between a TPS and an MIS.

– Discuss information systems in the functional areas of business organizations.


4

Learning Objectives

• Decision support systems (DSSs) are used when the problems are more unstructured.

– List and discuss important characteristics of DSSs that give them the potential to be effective management support tools.

– Identify and describe the basic components of a DSS.


5

Learning Objectives

• Specialized support systems, such as group decision support systems (GDSSs) and executive support systems (ESSs), use the overall approach of a DSS in situations such as group and executive decision making.

– State the goals of a GDSS and identify the characteristics that distinguish it from a DSS.

– Identify the fundamental uses of an ESS and list the characteristics of such a system.


6

Decision Making and Problem Solving


7

How Decision Making Relates to Problem Solving


8

Decision Making

• Intelligence– Identify problems and opportunities– Investigate resource and environmental constraints

• Design– Generate alternatives– Evaluate alternatives

• Choice– Select a course of action


9

Problem Solving

• Decision making• Implementation

– Apply the solution– Inform related parties– Execute solution steps

• Monitoring– Ensure that the solution is implemented as planned– Monitor for unforeseen situations


10

Programmed versus Nonprogrammed Decisions

• Programmed decisions– Rules or procedures– Easy to computerize– Ex: Order new items when the inventory drops below

100

• Nonprogrammed decisions– Rules and relationships not defined– Problem is not routine– Not easily quantifiable– Determine a training program for a new employee


11

Problem Solving Approaches

• Optimization: find the best solution• Satisficing:

– Find a good solution– Does not look at all solutions– Easier to find then an optimum solution

• Heuristics: – Rules of thumb– Commonly accepted guidelines– Ex: Always have 5 units of an item in stock


12

Optimization, Satisficing, and Heuristic Approaches


13

An Overview of Management Information Systems


14

Sources of Managerial Information


15

Transforming Data to Information

• Internal Input– TPSs– ERPs

• External Input – Customers– Suppliers– Competitors

• Output– Predetermined Reports


16

Reports (1)

• Scheduled Reports– Periodically– Ex: Daily report to monitor the production of an item– Key-indicator report: Summarizes the previous

day’s critical activities

• Demand Reports– Give information when needed– FedEx package reports for customers– Competitors


17

Reports (2)

• Exception Reports– Generated when something unusual happens– Trigger point: Manager decides on the “unusual

event”– Ex: Report on orders that are not delivered in five

days

• Drill Down Reports– Detailed report about a situation– See the situation at different levels


18

Reports Generated by an MIS


19

Reports Generated by an MIS


20

Guidelines for Developing MIS Reports


21

Functional Aspects of the MIS


22

Functional Aspects of MIS


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Financial MIS

• Provide financial information to internal parties– Integrate financial and operational information from

several sources– Ease analysis by providing fast financial data– Enable financial analysis from different aspects; time,

product, customer– Analyze historical and current data– Monitor use of funds

• Report to external parties• Auditing


24

Overview of a Financial MIS


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Manufacturing MIS

• Material requirements planning (MRP)– Determine when finished products are needed– Determine deadlines accordingly

• Manufacturing resource planning (MRPII)– Network scheduling– Improve customer service and productivity

• Just in time (JIT) inventory system– Inventory and materials delivered right before usage


26

Overview of a Manufacturing MIS


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Marketing MIS

• Supports managerial activities– Product development– Distribution– Pricing decisions– Promotional effectiveness– Sales forecasting

• Customer relationship software (CRM)– Collect customer data– Inform customers on products

• Example report: Possible prices for products


28

Overview of a Marketing MIS


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Human Resource MIS

Concerned with activities related to employees and potential employees of the organization.

• Subsystems include:– needs and planning assessments– recruiting– training and skills development– scheduling and assignment– employee benefits


30

Overview of a Human Resource MIS


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Other Management Information Systems

• Accounting MIS – Provides aggregate information on accounts payable,

accounts receivable, payroll, and many other applications.

– Sometimes done by other companies

• Geographic Information Systems – Computer system capable of assembling, storing,

manipulating, and displaying geographic information.– Useful when the geographic position of the data is

important

Fundamentals of Information Systems, Second Edition 1 Information and Decision Support Systems Chapter 6.

Documents

stock slide

executive support systems

new employee slide

executive decision making

course of action slide

decision making intelligence

stages of decision making

good solution