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Enhancing Decision Making: Managing The Digital Firm, 15 Edition

This chapter discusses how information systems can enhance decision making. It describes the different types of decisions made by senior managers, middle managers, operational managers, and employees. The four stages of decision making - intelligence, design, choice, and implementation - are also outlined. The chapter then explains business intelligence and analytics, describing how data is collected and analyzed to support decision making. Finally, it discusses the different constituencies that use business intelligence like operational managers, business analysts, and decision support systems.

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265 views13 pages

Enhancing Decision Making: Managing The Digital Firm, 15 Edition

This chapter discusses how information systems can enhance decision making. It describes the different types of decisions made by senior managers, middle managers, operational managers, and employees. The four stages of decision making - intelligence, design, choice, and implementation - are also outlined. The chapter then explains business intelligence and analytics, describing how data is collected and analyzed to support decision making. Finally, it discusses the different constituencies that use business intelligence like operational managers, business analysts, and decision support systems.

Uploaded by

sifat islam
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Management Information Systems

MANAGING THE DIGITAL FIRM, 15TH EDITION

Chapter 12
ENHANCING DECISION MAKING

VIDEO CASES
Case 1: Antivia: Community-based Collaborative Business Intelligence
Case 2: IBM and Cognos: Business Intelligence and Analytics for Improved Decision
Making
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Decision Making and Information Systems

• Business value of improved decision making


– Improving hundreds of thousands of “small” decisions
adds up to large annual value for the business
• Types of decisions:
– Unstructured: Decision maker must provide
judgment, evaluation, and insight to solve problem
– Structured: Repetitive and routine; involve definite
procedure for handling so they do not have to be
treated each time as new
– Semistructured: Only part of problem has clear-cut
answer provided by accepted procedure
2
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Decision Making and Information Systems

• Senior managers:
– Make many unstructured decisions
– E.g. Should we enter a new market?
• Middle managers:
– Make more structured decisions but these may include
unstructured components
– E.g. Why is order fulfillment report showing decline in
any region?
• Operational managers, rank and file employees
– Make more structured decisions
– E.g. Does customer meet criteria for credit?
3
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Decision Making and Information Systems


INFORMATION REQUIREMENTS OF KEY DECISION-MAKING GROUPS IN A FIRM

FIGURE 12-1 Senior managers, middle managers, operational managers, and employees have different types of decisions
and information requirements.

4
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Decision Making and Information Systems

• The 4 stages of the decision making process


1. Intelligence
• Discovering, identifying, and understanding the
problems occurring in the organization
2. Design
• Identifying and exploring solutions to the problem
3. Choice
• Choosing among solution alternatives
4. Implementation
• Making chosen alternative work and continuing to
monitor how well solution is working
5
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Decision Making and Information Systems

STAGES IN DECISION
MAKING
The decision-making process is
broken down into four stages.

FIGURE 12-2

6
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Business Intelligence in the Enterprise

• Business intelligence
– Infrastructure for collecting, storing, analyzing data
produced by business
– Databases, data warehouses, data marts
• Business analytics
– Tools and techniques for analyzing data
– OLAP, statistical models, data mining
• Business intelligence vendors
– Create business intelligence and analytics purchased
by firms
7
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Business Intelligence in the Enterprise

• Six elements in the business intelligence


environment
1. Data from the business environment
2. Business intelligence infrastructure
3. Business analytics toolset
4. Managerial users and methods
5. Delivery platform – MIS, DSS, ESS
6. User interface
8
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Business Intelligence in the Enterprise


BUSINESS INTELLIGENCE AND ANALYTICS FOR DECISION SUPPORT

FIGURE 12-3 Business intelligence and analytics requires a strong database foundation, a set of analytic tools, and an
involved management team that can ask intelligent questions and analyze data.

9
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Business Intelligence Constituencies

• Operational and middle managers


– Monitor day to day business performance
– Make fairly structured decisions
– Use MIS
• “Super user” and business analysts
– Use more sophisticated analysis
– Create customized reports
– Use DSS

10
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Business Intelligence Constituencies

• Decision support systems


– Use mathematical or analytical models
– Allow varied types of analysis
• “What-if” analysis
• Sensitivity analysis
• Backward sensitivity analysis
• Multidimensional analysis / OLAP
– E. g. pivot tables

11
Management Information Systems
CHAPTER 12: ENHANCING DECISION MAKING

Business Intelligence Constituencies

• Group Decision Support Systems (GDSS)


– Interactive system to facilitate solution of unstructured
problems by group
– Specialized hardware and software; typically used in
conference rooms
• Overhead projectors, display screens
• Software to collect, rank, edit participant ideas and responses
• May require facilitator and staff
– Enables increasing meeting size and increasing
productivity
– Promotes collaborative atmosphere, guaranteeing
anonymity
– Uses structured methods to organize and evaluate ideas
12
Management Information Systems
MANAGING THE DIGITAL FIRM, 15TH EDITION

Chapter 12
Thank you

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