Module 12: Supporting Decisions and Processes
Learning Objectives
After studying this module, you should be able to:
1. Examine the three types of decisions made in each phase of the decision-making process.
2. Describe a decision support system.
3. Explain an executive information system’s importance in decision making.
4. Summarize the uses for a geographic information system.
5. Describe collaboration systems or collaboration software, including their types and the criteria
for their selection.
6. Apply the eight guidelines for designing a management support system.
Types of Decisions in an Organization
• Structured Decisions:
• Can be automated because a well-defined standard operating procedure exists.
• Examples include record keeping, payroll, and simple inventory problems.
• Semi structured Decisions:
• Not as well defined by standard operating procedures but include a structured aspect that
benefits from information retrieval, analytical models, and information systems
technology.
• Examples include sales forecasting, budget preparation, capital acquisition analysis, and
computer configuration.
• Unstructured Decisions:
• Typically one-time decisions with no standard operating procedure.
• The decision maker’s intuition plays the most important role.
• Examples include research and development, hiring and firing, and introducing a new
product.
Phases of the Decision-Making Process
• Intelligence Phase:
• Examines the organization’s environment for conditions that need decisions.
• Data is collected from internal and external sources and processed.
• Design Phase:
• Defines criteria for the decision, generates alternatives for meeting the criteria, and
defines associations between the criteria and the alternatives.
• Choice Phase:
• Chooses the best and most effective course of action from the practical alternatives.
• Implementation Phase:
• Devises a plan for carrying out the alternative selected in the choice phase and obtains the
resources to implement the plan.
Decision Support Systems (DSS)
• Definition: An interactive information system consisting of hardware, software, data, and models
designed to assist decision makers in an organization.
• Components:
• Database: Includes both internal and external data.
• Model Base: Includes mathematical and statistical models.
• User Interface: How users access the DSS.
• Capabilities:
• What-if analysis: Shows the effect of a change in one variable.
• Goal seeking: Asks what has to be done to achieve a particular goal.
• Sensitivity analysis: Applies different variables to determine maximum or minimum values.
• Exception reporting analysis: Monitors performance of variables outside a defined range.
• Optimization analysis: Manipulates key variables to maximize profit or minimize costs.
• Roles in the DSS Environment:
• Users: The most important role; they use the DSS.
• Managerial Designer: Defines management issues in designing and using a DSS.
• Technical Designer: Focuses on how the DSS is implemented.
• Model Builder: Liaison between users and designers.
Executive Information Systems (EIS)
• Definition: Interactive information systems that give executives easy access to internal and
external data.
• Features: Include "drill-down" features and a digital dashboard.
• Advantages:
• Increase productivity.
• Enable coordination and collaboration with team members.
• Facilitate teamwork.
• Save time by providing timely information.
• Reduce costs and stress levels due to less travel.
• Characteristics:
• Tailored to meet management’s information needs.
• Provides online status access, trend analysis, and exception reporting.
• Offers information in graphical, tabular, and text formats.
• Includes statistical analysis techniques.
Geographic Information Systems (GIS)
• Definition: Captures, stores, processes, and displays geographic information or information in a
geographic context.
• Applications:
• Education planning: Analysing demographic data.
• Urban planning: Tracking changes in ridership and analysing demographic data.
• Government: Making the best use of personnel and equipment.
• Insurance: Combining data on community boundaries, street addresses, and zip codes.
• Marketing: Pinpointing areas with the greatest concentration of potential customers.
• Real estate: Finding properties that meet buyers’ preferences.
• Transportation and logistics: Managing vehicle fleets and coding delivery addresses.
Collaboration Systems
• Definition: Assist teams in communicating, collaborating, and coordinating their activities.
• Types:
• Communication Software: E-mail, chat, video conferencing.
• Task Management Software: Boards to create and manage tasks, task assignment tools.
• Document and Content Management Software: Enables storing and sharing information.
• Advantages:
• Increases productivity.
• Facilitates teamwork.
• Saves time by providing timely information.
• Reduces costs and stress levels due to less travel.
Guidelines for Designing a Management Support System
1. Support from the top.
2. Clearly defined objectives and benefits.
3. Identifying executives’ information needs.
4. Keeping lines of communication open.
5. Keeping the system’s complexity hidden and the interface simple.
6. Keeping the “look and feel” consistent.
7. Designing a flexible system.
8. Making sure response time is fast.
Key Terms
• Bar charts, Choice phase, Line charts (or time-series charts), Management support systems
(MSSs), Collaboration system or collaboration software, Managerial designer, Column charts,
Communication software, Decision support system (DSS), Design phase, Digital dashboard,
Model base, Model builder, Pie charts, Semi structured decisions, Structured decisions,
Document and content management software, Task management software, Executive
information systems (EISs), Technical designer, Geographic information system (GIS),
Unstructured decisions, Implementation phase, XY (scatter) charts, Intelligence phase.
Reviews and Discussions
1. Examples of structured, semi structured, and unstructured decisions in a business organization:
• Structured: Payroll processing.
• Semi structured: Budget preparation.
• Unstructured: Introducing a new product.
2. Three main components of a decision support system:
• Database, model base, user interface.
3. Two unique features of an executive information system:
• Drill-down features, digital dashboard.
4. Three applications of a geographic information system:
• Urban planning, marketing, real estate.
5. Definition of collaboration system or collaboration software:
• Assists teams in communicating, collaborating, and coordinating their activities.
6. Three types of collaboration software:
• Communication software, task management software, document and content
management software.
7. Four examples of graphs and charts used by an EIS:
• Line charts, pie charts, bar charts, column charts.
8. Three business examples of what-if analysis:
• Impact of labour cost increase on product pricing.
• Effect of advertising budget increase on total sales.
• Result of changing interest rates on loan payments.
Central Node:
Supporting Decisions and Processes
Branch 1: Types of Decisions
• Sub-branch 1.1: Structured Decisions
• Defined by standard operating procedures (SOPs)
• Examples: Record keeping, payroll, inventory management
• Supported by transaction-processing systems
• Sub-branch 1.2: Semi structured Decisions
• Partially defined by SOPs but include structured aspects
• Examples: Budget preparation, sales forecasting, capital acquisition analysis
• Supported by decision support systems (DSS)
• Sub-branch 1.3: Unstructured Decisions
• Unique, one-time decisions without SOPs
• Examples: Research & development, hiring/firing, introducing new products
• Supported by executive information systems (EIS)
Branch 2: Phases of Decision-Making Process
• Sub-branch 2.1: Intelligence Phase
• Identifying problems or opportunities
• Collecting internal and external data
• Discovering ways to approach the problem
• Sub-branch 2.2: Design Phase
• Defining criteria for decision-making
• Generating alternatives
• Associating criteria with alternatives
• Sub-branch 2.3: Choice Phase
• Selecting the best alternative
• Analysing feasibility of each option
• Sub-branch 2.4: Implementation Phase
• Developing a plan for execution
• Obtaining resources for implementation
Branch 3: Decision Support Systems (DSS)
• Sub-branch 3.1: Components
• Database
• Model Base
• User Interface
• Sub-branch 3.2: Capabilities
• What-if Analysis
• Goal Seeking
• Sensitivity Analysis
• Exception Reporting Analysis
• Optimization Analysis
• Sub-branch 3.3: Roles in DSS Environment
• Users
• Managerial Designer
• Technical Designer
• Model Builder
Branch 4: Executive Information Systems (EIS)
• Sub-branch 4.1: Features
• Drill-down capabilities
• Digital Dashboards
• Graphical User Interfaces (GUIs)
• Sub-branch 4.2: Benefits
• Increases productivity
• Facilitates communication between management and employees
• Improves control over operations
• Sub-branch 4.3: Common Charts Used
• Line Charts (Time-Series)
• Pie Charts
• Bar Charts
• XY (Scatter) Charts
• Column Charts
Branch 5: Geographic Information Systems (GIS)
• Sub-branch 5.1: Applications
• Education Planning
• Urban Planning
• Government Operations
• Insurance Risk Assessment
• Marketing and Real Estate
• Sub-branch 5.2: Tasks Performed
• Capturing, storing, processing, and displaying geographic data
• Superimposing results on maps
• Conducting spatial analysis
Branch 6: Collaboration Systems
• Sub-branch 6.1: Types
• Communication Software (e.g., Email, Chat, Video Conferencing)
• Task Management Software (e.g., Boards, Scheduling Tools)
• Document and Content Management Software (e.g., File Sharing, Editing Tools)
• Sub-branch 6.2: Advantages
• Increases productivity
• Facilitates teamwork
• Saves time through timely information sharing
• Reduces travel costs
Branch 7: Guidelines for Designing Management Support Systems
• Sub-branch 7.1: Key Guidelines
• Top Management Support
• Clearly Defined Objectives and Benefits
• Identify Executives' Information Needs
• Keep Lines of Communication Open
• Simplify Interface Design
• Maintain Consistent "Look and Feel"
• Design for Flexibility
• Ensure Fast Response Time
INF1505: Module 12
What are the three types of decisions in an Structured decisions, semi structured decisions,
organization? and unstructured decisions.
A structured decision can be automated because
What defines a structured decision? a well-defined standard operating procedure
exists for these types of decisions.
An unstructured decision is typically a one-time
decision with no standard operating procedure,
What characterizes an unstructured decision?
where the decision maker’s intuition plays the
most important role.
Intelligence phase, design phase, choice phase,
What are the four phases of the decision-making
and implementation phase.
process?
In the intelligence phase, the decision maker
examines the organization’s environment for
What happens during the intelligence phase?
conditions that need decisions and collects data
from internal and external sources.
In the design phase, the objective is to define
criteria for the decision, generate alternatives for
What occurs during the design phase?
meeting the criteria, and define associations
between the criteria and the alternatives.
In the choice phase, the best and most effective
What is the purpose of the choice phase? course of action is chosen from the practical
alternatives.
In the implementation phase, the organization
devises a plan for carrying out the alternative
What happens during the implementation phase?
selected in the choice phase and obtains the
resources to implement the plan.
A DSS is an interactive information system
consisting of hardware, software, data, and
What is a decision support system (DSS)?
models (mathematical and statistical) designed
to assist decision makers in an organization.
What are the three main components of a DSS? Database, model base, and user interface.
An EIS is an interactive information system that
gives executives easy access to internal and
What is an executive information system (EIS)?
external data, often including "drill-down"
features and a digital dashboard.
A GIS captures, stores, processes, and displays
geographic information or information in a
What is a geographic information system (GIS)?
geographic context.
Education planning, urban planning, and
What are three applications of a GIS?
marketing.
Collaboration software assists teams in
What is collaboration software? communicating, collaborating, and coordinating
their activities.
Communication software, task management
What are the three types of collaboration
software, and document and content
software?
management software.
Support from the top, clearly defined objectives
What are four guidelines for designing a and benefits, identifying executives’ information
management support system? needs, and keeping lines of communication open.
The managerial designer defines the management
What is the role of a managerial designer in a DSS
issues in designing and using a DSS, focusing on
environment?
goals and needs rather than technical aspects.
The technical designer focuses on how the DSS is
What is the role of a technical designer in a DSS implemented, addressing questions about data
environment? storage, file structure, user access, response
time, and security measures.
The model builder acts as a liaison between users
and designers, explaining the model's
What is the role of a model builder in a DSS
assumptions, limitations, and strengths, and
environment?
suggesting new applications of the DSS.
Test: Supporting Decisions and Processes
Multiple-Choice Questions (20)
1. What defines a structured decision?
a) A one-time decision with no standard operating procedure
b) A decision that benefits from information retrieval and analytical models
c) A decision that can be automated because of a well-defined standard operating procedure
d) A decision made by executives
2. Which phase of the decision-making process involves defining criteria for the decision?
a) Intelligence Phase
b) Design Phase
c) Choice Phase
d) Implementation Phase
3. What is the main purpose of an Executive Information System (EIS)?
a) To assist in tactical decision-making
b) To provide executives with easy access to internal and external data
c) To manage project timelines
d) To automate structured decisions
4. Which type of chart is best suited for showing changes in data over time?
a) Bar Chart
b) Pie Chart
c) Line Chart
d) XY (Scatter) Chart
5. What is the primary function of a Decision Support System (DSS)?
a) To facilitate communication among team members
b) To assist decision-makers with semi structured and unstructured tasks
c) To store geographic data
d) To manage task assignments
6. Which of the following is NOT a component of a DSS?
a) Database
b) Model Base
c) User Interface
d) Task Management Software
7. What does GIS stand for?
a) Geographic Information System
b) Global Information System
c) Generalized Information System
d) Graphical Interface System
8. Which application of GIS is used in urban planning?
a) Finding the nearest healthcare facility
b) Tracking changes in ridership on mass-transit systems
c) Monitoring virus mutations during an outbreak
d) Pinpointing areas with high concentrations of potential customers
9. Which collaboration software feature allows multiple users to edit a document simultaneously?
a) Synchronous Editing
b) File Sharing
c) Chat
d) Calendar
10. What is the first step in selecting collaboration software?
a) Comparing price tags
b) Evaluating vendor support
c) Defining your needs
d) Testing the software
11. Which guideline emphasizes the importance of keeping the system's interface simple?
a) Keeping lines of communication open
b) Keeping the "look and feel" consistent
c) Keeping the system’s complexity hidden
d) Making sure response time is fast
12. What is the role of a managerial designer in a DSS environment?
a) To define technical specifications for the system
b) To focus on how the DSS is implemented
c) To specify management goals and data requirements
d) To write code for the system
13. Which of the following is NOT a capability of EISs?
a) Drill-down analysis
b) Forecasting future trends
c) Managing project timelines
d) Exception reporting
14. Which phase of the decision-making process involves devising a plan for carrying out the
selected alternative?
a) Intelligence Phase
b) Design Phase
c) Choice Phase
d) Implementation Phase
15. What is the purpose of sensitivity analysis in a DSS?
a) To show the effect of a change in one variable
b) To determine the maximum price you could pay for raw materials and still make a profit
c) To generate reports showing how forecasts vary based on certain factors
d) To manipulate key variables to maximize profit
16. Which type of decision is most likely to involve conflicting objectives?
a) Structured Decision
b) Semi structured Decision
c) Unstructured Decision
d) Operational Decision
17. What is the role of a model builder in a DSS environment?
a) To act as a liaison between users and designers
b) To focus on how the DSS is implemented
c) To write code for the system
d) To define management goals
18. Which of the following is NOT a benefit of using a GIS?
a) Locating contaminated water sources
b) Identifying medical infrastructures
c) Automating payroll processes
d) Planning interventions for disease control
19. Which type of chart is best suited for comparing data items?
a) Line Chart
b) Pie Chart
c) Bar Chart
d) XY (Scatter) Chart
20. What is the purpose of exception reporting analysis in a DSS?
a) To monitor performance of variables outside a defined range
b) To show relationships between two sets of data
c) To aggregate data across regions
d) To forecast future trends
True or False Questions (20)
1. Structured decisions are typically one-time decisions with no standard operating procedure.
2. The intelligence phase involves collecting data and identifying ways to approach the problem.
3. A DSS is designed primarily to assist with structured decisions.
4. An EIS typically includes features such as drill-down capabilities and digital dashboards.
5. Collaboration software increases productivity but does not improve communication.
6. GIS applications are used exclusively in government agencies.
7. Task management software helps teams prioritize and schedule tasks effectively.
8. The implementation phase involves analysing alternatives and selecting the best course of action.
9. Sensitivity analysis enables users to apply different variables to determine their impact on outcomes.
10. Executive information systems are branches of DSSs.
11. Communication software is a type of collaboration software.
12. A digital dashboard integrates information from multiple sources and presents it in a unified format.
13. The design phase focuses on implementing the chosen alternative.
14. A pie chart is best suited for showing changes in data over time.
15. GISs can be used to analyse demographic data for education planning.
16. The choice phase involves generating alternatives for meeting decision criteria.
17. Document management software allows team members to store and share files collaboratively.
18. Top management support is crucial for the success of any management support system.
19. What-if analysis shows the effect of a change in one variable.
20. Collaboration software eliminates the need for face-to-face meetings entirely.
Fill in the Missing Word Questions (20)
1. A __________ decision can be automated because a well-defined standard operating procedure exists.
2. The __________ phase involves collecting data and identifying ways to approach the problem.
3. A __________ is an interactive information system consisting of hardware, software, data, and models.
4. Executive information systems are often referred to as __________.
5. A __________ captures, stores, processes, and displays geographic information.
6. The three phases of the decision-making process are intelligence, __________, and choice.
7. A __________ chart is best suited for showing proportions of different data items.
8. Collaboration software assists teams in communicating, collaborating, and __________ their activities.
9. The __________ phase involves devising a plan for carrying out the selected alternative.
10. A __________ is the liaison between users and designers in a DSS environment.
11. __________ analysis shows the effect of a change in one variable.
12. A __________ dashboard integrates information from multiple sources and presents it in a unified
format.
13. GIS applications can be used for __________ planning and urban development.
14. The __________ phase involves analysing alternatives and selecting the best course of action.
15. A __________ chart is best suited for comparing data items.
16. The three types of collaboration software are communication software, task management software,
and __________ software.
17. A __________ system provides executives with easy access to internal and external data.
18. The __________ base component of a DSS includes mathematical and statistical models.
19. A __________ is a collection of applications that supports decision makers by providing access to a
shared environment.
20. __________ software enables team members to store and share files collaboratively.
Answers
Multiple-Choice Answers
1. c
2. b
3. b
4. c
5. b
6. d
7. a
8. b
9. a
10. c
11. c
12. c
13. c
14. d
15. b
16. c
17. a
18. c
19. c
20. a
True or False Answers
1. False
2. True
3. False
4. True
5. False
6. False
7. True
8. False
9. True
10. True
11. True
12. True
13. False
14. False
15. True
16. False
17. True
18. True
19. True
20. False
Fill in the Missing Word Answers
1. structured
2. intelligence
3. DSS
4. EISs
5. GIS
6. design
7. pie
8. coordinating
9. implementation
10. model builder
11. what-if
12. digital
13. education
14. choice
15. bar
16. document and content management
17. EIS
18. model
19. collaboration
20. document and content management
