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.
DSS’s can help corporations by:
- Increasing market share
- Reducing costs
- Increasing profitability
- Enhancing product quality
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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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