SISTEM INFORMASI PRODUKSI

Chapter Outline 12.1 Managers and Decision Making 12.2 What Is Business Intelligence? 12.3 Business Intelligence Applications for Data Analysis 12.4 Business Intelligence Applications for Presenting Results 12.5 Business Intelligence in Action: Corporate Performance Managemen

OPENING CASE https://www.youtube.com/watch?v=cyvfsi3MX-M On average, an American woman buys 64 new pieces of clothing per year—half of which she will wear only one time A major trend in today's economy is a transition from ownership to subscribing and sharing. At least one company has implemented this business model in the fashion industry. Located at the intersection of the sharing economy, Facebook, and Instagram, Rent the Runway (RTR; www.renttherunway.com) buys designer dresses wholesale and rents them over the web, charging only a fraction of the price of the dress. For example, an RTR customer can wear a Calvin Klein gown that costs thousands of dollars for only $70. In 2015, RTR launched a subscription service called Unlimited that allows customers to rent and wear up to three dresses or accessories (sunglasses, bags, jackets) for as long as they want for $139 per month.

Analytics Algorithms With every dress it rents, RTR's analytics algorithms learn more about effective strategies to track the location of each item, forecast demand, select shipping methods, set prices, and control inventory. RTR's algorithms also examine customer reviews to learn which dresses women are renting for certain occasions.

Business analytics (BA) Business analytics (BA) is the process of developing actionable decisions or recommendations for actions based on insights generated from historical data. Business analytics examines data with a variety of tools, formulates descriptive, predictive, and prescriptive analytics models, and communicates these results to organizational decision makers. Business analytics can answer questions such as: What happened, how many, how often, where the problem is, what actions are needed, why is this happening, what will happen if these trends continue, what will happen next, what is the best (or worst) that can happen, and what actions should the organization take to achieve various successful business outcomes?

Business analytics systems Recall from Chapter 1 that the essential goal of information systems is to provide the right information to the right person, in the right amount, at the right time, in the right format. In essence, BA achieves this goal. Business analytics systems provide actionable business results that decision makers can act on in a timely fashion.

The Business Analytics Process

Descriptive analytics, which tracks key performance indicators to understand the present state of a business; Predictive analytics, which analyzes trend data to assess the likelihood of future outcomes; and Prescriptive analytics, which uses past performance to generate recommendations about how to handle similar situations in the future.

Business Analytics Tools Excel, multidimensional analysis (also called OLAP), data mining, and decision-support systems. BA also employs numerous statistical procedures, which include descriptive statistics, affinity analysis, linear, multiple, and logistic regression, as well as many others.

Descriptive analytics Descriptive analytics are the first step in data reduction. Descriptive analytics summarize what has happened in the past and allow decision makers to learn from past behaviors. Descriptive analytics are useful to produce information such as total stock in inventory, average dollars spent per customer, and year-over-year change in sales. Common examples of descriptive analytics are reports that provide historical insights regarding an organization's production, financials, operations, sales, finance, inventory, and customers.

Prescriptive Analytics prescriptive analytics A type of business analytics that recommends one or more courses of action and shows the likely outcome of each decision.

Business Analytics VS Business Analysis Description Business Analytics Business Analysis The main focus: data and reporting functions and processes Architectural domains Data architecture Information architecture Technology architecture Enterprise architecture Process architecture Organization architecture Project management for: SDLC/ agile SDLC

Business Analytics VS Business Analysis Description Business Analytics Business Analysis More examples Making a dashboard to track the main performance metrics Using a data warehouse to report previous performance Relying on statistical methods to predict future sales. This is based on past sales Conducting simulations to investigate various scenarios Exploring data to find new patterns and relationships Explaining why a certain result occurred Experimenting to test previous decisions Forecasting future results Making a Business Architecture Creating a Business Case Conducting a risk assessment Requirements elicitation Analysis of Business Process Documentation of Requirements

12.1 Managers and Decision Making Management is a process by which an organization achieves its goals through the use of resources (people, money, materials, and information). These resources are considered to be inputs. Achieving the organization’s goals is the output of the process. Managers oversee this process in an attempt to optimize it. A manager’s success often is measured by the ratio between the inputs and outputs for which he or she is responsible. This ratio is an indication of the organization’s productivity

The Manager’s Job and Decision Making all managers perform three basic roles (Mintzberg, 1973): 1. Interpersonal roles: figurehead, leader, liaison 2. Informational roles: monitor, disseminator, spokesperson, analyzer 3. Decisional roles: entrepreneur, disturbance handler, resource allocator, negotiator

Decision A decision refers to a choice among two or more alternatives that individuals and groups make. Decision making is a systematic process. Economist Herbert Simon (1977) described decision making as composed of three major phases: intelligence, design, and choice. Once the choice is made, the decision is implemented.

Why Managers Need IT Support The number of alternatives is constantly increasing, and comparisons. Most decisions must be made under time pressure. It often is not possible to manually process information fast enough to be effective. Due to increased uncertainty in the decision environment, decisions are becoming more complex. It is usually necessary to conduct a sophisticated analysis in order to make a good decision. It often is necessary to rapidly access remote information, consult with experts, or conduct a group decision-making session, all without incurring large expenses.

Decision support framework

12.2. What Is Business Intelligence? Business intelligence (BI) is a broad category of applications, technologies, and processes for gathering, storing, accessing, and analyzing data to help business users make better decisions. BI applications enable decision makers to quickly ascertain the status of a business enterprise by examining key information The essential goal of information systems is to provide the right information to the right person, in the right amount, at the right time, in the right format. In essence, BI achieves this goal. BI systems provide business intelligence that you can act on in a timely fashion.

Business Analytics Business analytics (BA) encompasses not only applications, but also technologies and processes. It includes both “getting data in” (to a data mart or warehouse) and “getting data out” (through BA applications).

12.2. What Is Business Intelligence? (cont’) Users analyze the data in warehouses and marts using a wide variety of BI tools. Many vendors offer integrated packages of these tools under the overall label of business intelligence (BI) software. Major BI software vendors include SAS (www.sas.com), Hyperion (www.hyperion.com, now owned by Oracle), Business Objects (www.businessobjects.com, now owned by SAP), Information Builders (www.informationbuilders.com), SPSS (www.spss.com, now owned by IBM), and Cognos (www.ibm.com/cognos).

12.3. Business Intelligence Applications for Data Analysis A good strategy to study the ways in which organizations use business intelligence applications is to consider how the users analyze data, how they present the results of their analyses, and how managers and executives (who can also be users) implement these results. A variety of BI applications for analyzing data are available. They include multidimensional analysis (also called online analytical processing, or OLAP), data mining, and decision supportsystems.

Multidimensional Analysis or Online Analytical Processing (OLAP Some BI applications include online analytical processing (OLAP), also referred to as multidimensional analysis capabilities. OLAP involves “slicing and dicing” data stored in a dimensional format, drilling down in the data to greater detail, and aggregating the data. Consider our example from Chapter 5. Recall Figure 5.11 showing the data cube. The

Data mining Data mining refers to the process of searching for valuable business information in a large database, data warehouse, or data mart. Data mining can perform two basic operations: (1) predicting trends and behaviors, and (2) identifying previously unknown patterns. BI applications typically provide users with a view of what has happened; data mining helps to explain why it is happening, and it predicts what will happen in the future.

Decision support systems (DSSs) Decision support systems (DSSs) combine models and data in an attempt to analyze semistructured problems and some unstructured problems that involve extensive user involvement. Models are simplified representations, or abstractions, of reality. DSSs enable business managers and analysts to access data interactively, to manipulate these data, and to conduct appropriate analyses. Three types of analysis are useful for any type of decisionsupport application. Excel, for example, supports all three: sensitivity analysis, what-if analysis, and goal-seeking analysis

12.4. Business Intelligence Applications for Presenting Results The results of the types of data analyses you can be presented with: Dashboard: provides easy access to timely information and direct access to management reports. They evolved from executive information systems, which were information systems designed specifically for the information needs of top executives Data Visualization: data presented to users in visual formats such as text, graphics, and tables following data processing. Data Visualization makes IT applications more attractive and understandable to users. Real-Time Business Intelligence: includes the use of real time data for analysis as it is created rather than using historical data for analysis.

FIGURE 12.3 Sample performance dashboard. FIGURE 12.3 Sample performance dashboard. (Image courtesy of Dundas Data Visualization, Inc., 2014 (www.dundas.com).)

SELESAI