Decision support system (DSS): a computer-based information system designed to help knowledge workers select one of many alternative solutions to a problem.
Organisations need to make good decisions, in many cases Information Systems in the form of Management Information Systems and Decision Support Systems assist in the decision making process.
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DSS’s can help corporations by:
- Increasing market share
- Reducing costs
- Increasing profitability
- Enhancing product quality
Components of decision support systems
- Data management module: Enables users to perform analysis of data via database, data warehouse and via internet.
- Model management module: Enables users to use models to explore different scenarios and their effects
- Dialog module: Enables users to access and manipulate the system and generate reports in different formats
How do these components help users?
- Enter a request in a convenient manner
- Search vast amounts of data
- Process the data through desired models
- View the results in a desired format
Decision Support Systems in Action
- DSSs can be used on demand or integrated into a scheme that enforces corporate policy
- DSSs help maintain standard criteria in decision making throughout the organisation
- Automated decision production is becoming very popular – The only labor required is for data entry
Applications of decision support systems
- Food production and retailing
- Tax planning: Statistics
- Financial services
- Website design
- HR Benefits
Structured and semi-structured problems in business
Structured Problems
- How many workers are needed to fully staff production line A?
- What is our optimal order quantity for raw material Z, based on our production?
- How many turbines are needed to supply power to Hickstown?
- Which of our regions yields the highest revenue per salesperson?
- Which money market fund currently yields the highest return?
- How much would the implementation of pollution-preventing devices cost us?
Semi-structured Problems
- What are the benefits of merging with XYZ, Inc.?
- Where should we deploy the next five stores of our retail chain?
- How will the consumer react if we lower the price of our product by 10 percent?
- What is the best advertisement campaign to launch our new financial service?
- What are the benefits of opening an office in Paris, France?
- Which stock will yield the highest return by the end of the year?
Benefits of decision support systems
Here’s how these components help users.
- Enter a request in a convenient manner
- Search vast amounts of data
- Process the data through desired models
- View the results in a desired format
Group Decision Support Systems
Group decision support system (GDSS)
- Also called a group intelligence system, collaborative system, or group system
- Facilitates the contribution of ideas, brainstorming, and choosing promising solutions
- Allow participants to define a problem, contribute ideas, then vote on the decision
- Help structure the decision-making process while allowing participants to remain anonymous
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