DECISION SUPPORT SYSTEMS

Decision Support Systems

Decision Support Systems

Introduction

Decision support systems (DSS) are a diverse group of interactive computer tools—primarily customizable software designed to assist managerial decision making. They fall into a broader class known as management support systems (MSSs). The goal of a DSS is to make management more efficient and effective, particularly with ad hoc and discretionary decisions (versus routine or programmatic ones that require little judgment). Interactivity is key; unlike related expert systems and many artificial intelligence tools, DSS generally do not attempt to make the decision themselves, but rather present information in a manner that is conducive to making an informed and efficient decision. A Communications Driven DSS models is when many collaborators work together to come up with a series of decisions to set in motion a solution or strategy. This communications driven DSS model can be in an office environment or on the web. (Delic, K.A., Douillet, L. and Dayal, U. 2001, 65-78)

Components of a Dss

There are three basic components in a DSS:

a database

a model base

a user interface

Depending on the system, each of these components may be very simple or highly elaborate. The database, or in advanced systems, a database management system (DBMS) or a data warehouse, consists of structured, real-life information, such as customer account records, product sales history, employee schedules, or manufacturing process statistics. The model base, or model base management system (MBMS), contains one or more models for the kind of analysis the system will perform. For example, if the purpose of the system is to supply sales projections under different conditions, one model might be a linear regression formula derived from past sales and other factors. The user interface integrates the two into a coherent system and provides the decision maker with controls for—and possibly feedback about—managing the data and the models. (Delic, K.A., Douillet, L. and Dayal, U. 2001, 65-78)

Explanation

Anatomy of a Decision

In order to discuss the support of decisions and what these tools can or should do, it is necessary to have a perspective on the nature of the decision process and thus what it means to support it. One way of looking at a decision is in terms of three areas or components. The first component is the data collected by a decision maker to be used in making the decision. The second component is the process selected by the decision maker to combine this data. Finally, there is an evaluation or learning component that compares decisions and examines them to see if there is a need to change either the data being used or the process that combines the data. These components of a decision interact with the characteristics of the decision being made. One approach to categorizing decisions is to consider the degree of structure in the decision-making activity. (Delic, K.A., Douillet, L. and Dayal, U. 2001, 65-78)

The structure of decisions

Structured decisions

A structured decision is one in which all three components can be fairly well specified, ...