1 CHAPTER 8 Enterprise Decision Support Systems

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 2 Enterprise Decision Support Systems n DSS to provide enterprise-wide support n Executives n Many decision makers in different locations n Enterprise Resource Planning (ERP) systems

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 3 Enterprise Systems: Concepts and Definitions n Executive information systems (EIS) n Executive support systems (ESS) n Enterprise information systems (EIS)

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 4 n DSS and ODSS n 1980s: Top execs get Executive Information Systems n 1995+’s: Move to everybody’s information systems and enterprise information systems n Definitions follow Evolution of Executive and Enterprise Information Systems

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 5 Executive Information System (EIS) n A computer-based system that serves the information needs of top executives n Provides rapid access to timely information and direct access to management reports n Very user-friendly, supported by graphics n Provides exceptions reporting and "drill-down" capabilities n Easily connected to the Internet n Drill down

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 6 Executive Support System (ESS) Comprehensive support system that goes beyond EIS to include n Communications n Office automation n Analysis support n Intelligence

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 7 Enterprise Information System n Corporate-wide system n Provides holistic information n From a corporate view n Part of enterprise resource planning (ERP) systems n For business intelligence n Leading up to enterprise information portals and knowledge management systems

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 8 Executives’ Role and Their Information Needs n Decisional Executive Role (2 Phases) 1. Identification of problems and/or opportunities 2. The decision of what to do about them n Flow chart and information flow (Figure 8.1) n Use phases to determine executives’ information needs

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 9 Methods for Finding Information Needs n Wetherbe's Approach 1. Structured Interviews –IBM's Business System Planning (BSP) –Critical Success Factors (CSF) –Ends/Means (E/M) Analysis 2. Prototyping n 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 n Other Methods

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 10 Characteristics of EIS n Drill down n Critical success Factors (CSF) n Status access n Analysis n Exception reporting n Colors and audio n Navigation of information n Communication

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 11 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

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 12 Characteristics and Benefits of EIS (Table 8.1) n Quality of information n User interface n Technical capability provided n Benefits

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 13 Comparing and Integrating EIS and DSS n Tables 8.2 and 8.3 compare the two systems –Table DSS definitions related to EIS –Table Comparison of EIS and DSS n EIS is part of decision support

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 14 n EIS vendors - easy interfaces with GSS n Some EIS built in Lotus Domino / Notes n Comshare Inc. and Pilot Software, Inc. - Lotus Domino/Notes-based enhancements and Web/Internet/Intranet links Integrating EIS and Group Support Systems

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 15 Traditional EIS Software n Major Commercial EIS Software Vendors –Comshare Inc. ( –Pilot Software Inc. ( n Application Development Tools –In-house components –Comshare Commander tools –Pilot Software’s Command Center Plus and Pilot Decision Support Suite

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 16 n EIS n Data access n Data warehousing n OLAP n Multidimensional analysis n Presentations n Web

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 17 Multidimensional Analysis n Easy to develop an EIS in an OLAP system n Most are Web-ready n Can tap into data in a data warehouse via the Web n Use advanced visualization tools

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 18 Representative OLAP / Multidimensional Analysis Packages n BrioQuery (Brio Technology Inc.) n Business Objects (Business Objects Inc.) n Decision Web (Comshare Inc.) n DataFountain (Dimensional Insight Inc.) n DSS Web (MicroStrategy Inc.) n Focus Fusion (Information Builders Inc.) n InfoBeacon Web (Platinum Technology Inc.) n Oracle xpress Server (Oracle Corporation) n Pilot Internet Publisher (Pilot Software Inc.)

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 19 Including Soft Information in EIS Soft information is fuzzy, unofficial, intuitive, subjective, nebulous, implied, and vague

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 20 Soft Information Used in Most EIS n Predictions, speculations, forecasts, estimates (78.1%) n Explanations, justifications, assessments, interpretations (65.6%) n News reports, industry trends, external survey data (62.5%) n Schedules, formal plans (50.0%) n Opinions, feelings, ideas (15.6%) n Rumors, gossip, hearsay (9.4%) Soft Information Enhances EIS Value

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 21 Organizational DSS (ODSS) n Three Types of Decision Support –Individual –Group –Organizational Hackathorn and Keen (1981)

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 22 n Organizational decision support focuses on an organizational task or activity involving a sequence of operations and actors n Each individual's activities must mesh closely with other people's work n Computer support is for –Improving communication and coordination –Problem solving

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 23 Definitions of ODSS n 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) n 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)

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 24 n 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) n 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)

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 25 Common Characteristics of ODSS (George, 1991) n Focus is on an organizational task or activity or a decision that affects several organizational units or corporate problems n Cuts across organizational functions or hierarchical layers n Almost always involves computer-based technologies, and may involve communication technologies n Can Integrate ODSS with Group DSS and Executive Information Systems n ODSS are an enterprise information system directly concerned with decision support

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 26 Supply and Value Chains and Decision Support n Supply chain: (originally) flow of materials from sources to internal use n Demand chain: flow from inside to customers

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 27 Supply Chain n The flow of materials, information, and services from raw material suppliers through factories and warehouses to the end customers n Includes the organizations and processes that create and deliver value to the end customers

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 28 Supply Chain Management (SCM) n To deliver an effective supply chain and do it effectively n To plan, organize, and coordinate the supply chain’s activities

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 29 SCM Benefits n Reduction in uncertainty and risks in the supply chain n Positively affect –inventory levels –cycle time –processes –customer service n Increase profitability

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 30 Supply Chain Components n Upstream n Internal supply chain n Downstream Involves product life cycle activities Example (Figure 8.2)

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 31 Supply Chain n Related to the Value Chain Model (Porter)

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 32 Supply Chain Problems n Uncertainty in the demand forecast n Uncertainty in delivery times n Quality problems n Poor customer service n High inventory costs n Low revenue n Extra costs

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 33 Solutions to Supply Chain Problems n Outsourcing n Buy, not make n Configure optimal shipping plans n Optimize purchasing n Strategic partnerships with suppliers n Just-in-time delivery of purchases n Reduce intermediaries n Reduce lead times (EDI) n Use fewer suppliers n Improve the supplier-buyer relationships n Build-to-order n Accurate demand by working with suppliers

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 34 Computerized Systems n MRP n ERP n SCM Integrating the supply chain

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 35 Enterprise Resource Planning (ERP) n Objective: integrate all departments and functions across an organization into a single computer system that can serve the entire enterprise’s needs

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 36 ERP Software Vendors n SAP n Baan n PeopleSoft n Oracle n J.D. Edwards n Computer Associates

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 37 ERP n Very (VERY!) expensive n 2nd generation: doing better n Early 2000: moving to Web n Will fail if an organization’s business processes do not fit the ERP system’s model

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 38 Application Service Providers and ERP Outsourcing n ASP: software vendor who leases ERP- based applications n Outsourcing n Now via the Web

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 39 Corporate (Enterprise) Portals and EIS n Integrates internal applications with external applications n Generally via the Web n Can include –groupware technologies –presentation and customization –publishing and distribution –search –categorization –integration

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 40 Frontline Decision Support Systems n Process of automating decision processes and pushing them down into the organization and even partners n Includes empowering employees

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition, Copyright 2001, Prentice Hall, Upper Saddle River, NJ 41 Future of Executive and Enterprise Support Systems n Toolbox for customized systems n Multimedia support n Better access (via PDFs and cell phones) n Virtual Reality and 3-D Image Displays n Merging of analytical systems (OLAP / multidimensional analysis)) with desktop publishing n Client/server architecture n Web-enabled EIS n Automated support and intelligent assistance n Integration of EIS and Group Support Systems n Global EIS n Integration and deployment with ERP products