1 CHAPTER 8 Enterprise Decision Support Systems. Decision Support Systems and Intelligent Systems,...

1

CHAPTER 8

Enterprise Decision

Support Systems

2Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition,

Copyright 2001, Prentice Hall, Upper Saddle River, NJ

Enterprise Decision Support Systems

DSS to provide enterprise-wide support

Executives

Many decision makers in different locations

Enterprise Resource Planning (ERP) systems



Enterprise Systems: Concepts and Definitions

Executive information systems (EIS)

Executive support systems (ESS)

Enterprise information systems (EIS)



DSS and ODSS 1980s: Top execs get Executive

Information Systems 1995+’s: Move to everybody’s

information systems and enterprise information systems

Definitions follow

Evolution of Executive and Enterprise Information

Systems



Executive Information System (EIS)

A computer-based system that serves the information needs of top executives

Provides rapid access to timely information and direct access to management reports

Very user-friendly, supported by graphics Provides exceptions reporting and "drill-down"

capabilities Easily connected to the Internet Drill down



Executive Support System (ESS)

Comprehensive support system that goes beyond EIS to include

Communications Office automation Analysis support Intelligence



Enterprise Information System

Corporate-wide system Provides holistic information From a corporate view Part of enterprise resource planning (ERP)

systems For business intelligence Leading up to enterprise information portals

and knowledge management systems



Executives’ Role and Their Information Needs

Decisional Executive Role (2 Phases)1. Identification of problems and/or opportunities

2. The decision of what to do about them

Flow chart and information flow (Figure 8.1)

Use phases to determine executives’ information needs



Methods for Finding Information Needs

Wetherbe's Approach

1. Structured Interviews– IBM's Business System Planning (BSP)

– Critical Success Factors (CSF)

– Ends/Means (E/M) Analysis

2. Prototyping Watson and Frolick's Approach

– Asking (interview approach)

– Deriving the needs from an existing information system

– Synthesis from characteristics of the systems

– Discovering (Prototyping)• Ten methods

Other Methods



Characteristics of EIS

Drill down Critical success Factors (CSF) Status access Analysis Exception reporting Colors and audio Navigation of information Communication



Critical Success Factors (CSF)

Monitored by five types of information 1. Key problem narratives

2. Highlight charts

3. Top-level financials

4. Key factors (key performance indicators (KPI))

5. Detailed KPI responsibility reports



Characteristics and Benefits of EIS

(Table 8.1)

Quality of information User interface Technical capability provided Benefits



Comparing and Integrating EIS and DSS

Tables 8.2 and 8.3 compare the two systems– Table 8.2 - DSS definitions related to EIS

– Table 8.3 - Comparison of EIS and DSS

EIS is part of decision support



EIS vendors - easy interfaces with GSS

Some EIS built in Lotus Domino / Notes

Comshare Inc. and Pilot Software, Inc. - Lotus Domino/Notes-based enhancements and Web/Internet/Intranet links

Integrating EIS and Group Support Systems



Traditional EIS Software

Major Commercial EIS Software Vendors– Comshare Inc. (www.comshare.com)

– Pilot Software Inc. (www.pilotsw.com) Application Development Tools– In-house components

– Comshare Commander tools

– Pilot Software’s Command Center Plus and Pilot Decision Support Suite



EIS Data access Data warehousing OLAP Multidimensional analysis Presentations Web



Multidimensional Analysis

Easy to develop an EIS in an OLAP system

Most are Web-ready

Can tap into data in a data warehouse via the Web

Use advanced visualization tools



Representative OLAP / Multidimensional Analysis

Packages BrioQuery (Brio Technology Inc.) Business Objects (Business Objects Inc.) Decision Web (Comshare Inc.) DataFountain (Dimensional Insight Inc.) DSS Web (MicroStrategy Inc.) Focus Fusion (Information Builders Inc.) InfoBeacon Web (Platinum Technology Inc.) Oracle xpress Server (Oracle Corporation) Pilot Internet Publisher (Pilot Software Inc.)



Including Soft Information in EIS

Soft information is fuzzy, unofficial, intuitive, subjective, nebulous, implied, and vague



Soft Information Used in Most EIS

Predictions, speculations, forecasts, estimates (78.1%) Explanations, justifications, assessments, interpretations

(65.6%) News reports, industry trends, external survey data

(62.5%) Schedules, formal plans (50.0%) Opinions, feelings, ideas (15.6%) Rumors, gossip, hearsay (9.4%)

Soft Information Enhances EIS Value



Organizational DSS (ODSS)

Three Types of Decision Support– Individual

– Group

– Organizational Hackathorn and Keen (1981)



Organizational decision support focuses on an organizational task or activity involving a sequence of operations and actors

Each individual's activities must mesh closely with other people's work

Computer support is for – Improving communication and coordination

– Problem solving



Definitions of ODSS A combination of computer and communication technology

designed to coordinate and disseminate decision-making across functional areas and hierarchical layers in order that decisions are congruent with organizational goals and management's shared interpretation of the competitive environment (R. T. Watson, 1990)

A DSS that is used by individuals or groups at several workstations in more than one organizational unit who make varied (interrelated but autonomous) decisions using a common set of tools (Carter et al., 1992)



A distributed decision support system (DDSS). Not a manager's DSS, but supports the organization's division of labor in decision making (Swanson and Zmud, 1990)

Apply the technologies of computers and communications to enhance the organizational decision-making process. Vision of technological support for group processes to the higher level of organizations (King and Star, 1990)



Common Characteristics of ODSS (George, 1991)

Focus is on an organizational task or activity or a decision that affects several organizational units or corporate problems

Cuts across organizational functions or hierarchical layers Almost always involves computer-based technologies, and

may involve communication technologies Can Integrate ODSS with Group DSS and Executive

Information Systems ODSS are an enterprise information system directly

concerned with decision support



Supply and Value Chains and Decision Support

Supply chain: (originally) flow of materials from sources to internal use

Demand chain: flow from inside to customers



Supply Chain The flow of materials, information, and

services from raw material suppliers through factories and warehouses to the end customers

Includes the organizations and processes that create and deliver value to the end customers



Supply Chain Management (SCM)

To deliver an effective supply chain and do it effectively

To plan, organize, and coordinate the supply chain’s activities



SCM Benefits

Reduction in uncertainty and risks in the supply chain

Positively affect– inventory levels– cycle time– processes– customer service

Increase profitability



Supply Chain Components

Upstream Internal supply chain Downstream

Involves product life cycle activities

Example (Figure 8.2)



Supply Chain

Related to the Value Chain Model (Porter)



Supply Chain Problems

Uncertainty in the demand forecast Uncertainty in delivery times Quality problems Poor customer service High inventory costs Low revenue Extra costs



Solutions to Supply Chain Problems

Outsourcing Buy, not make Configure optimal shipping plans Optimize purchasing Strategic partnerships with suppliers Just-in-time delivery of purchases Reduce intermediaries Reduce lead times (EDI) Use fewer suppliers Improve the supplier-buyer relationships Build-to-order Accurate demand by working with suppliers



Computerized Systems

MRP ERP SCM

Integrating the supply chain



Enterprise Resource Planning (ERP)

Objective: integrate all departments and functions across an organization into a single computer system that can serve the entire enterprise’s needs



ERP Software Vendors

SAP Baan PeopleSoft Oracle J.D. Edwards Computer Associates



ERP

Very (VERY!) expensive 2nd generation: doing better Early 2000: moving to Web Will fail if an organization’s business

processes do not fit the ERP system’s model



Application Service Providers and ERP Outsourcing

ASP: software vendor who leases ERP-based applications

Outsourcing

Now via the Web



Corporate (Enterprise) Portals and EIS

Integrates internal applications with external applications

Generally via the Web Can include

– groupware technologies

– presentation and customization

– publishing and distribution

– search

– categorization

– integration



Frontline Decision Support Systems

Process of automating decision processes and pushing them down into the organization and even partners

Includes empowering employees



Future of Executive and Enterprise Support Systems

Toolbox for customized systems Multimedia support Better access (via PDFs and cell phones) Virtual Reality and 3-D Image Displays Merging of analytical systems (OLAP / multidimensional analysis))

with desktop publishing Client/server architecture Web-enabled EIS Automated support and intelligent assistance Integration of EIS and Group Support Systems Global EIS Integration and deployment with ERP products

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