Management Support Systems Infsy 390 Dr. Ocker

Management Support Systems n MSS enables senior management to: n 1.access common, shared sources of n 2.internal and external information n 3.that have been summarized in n 4.easy-to-access, graphical displays.

Management Support Systems n function as an integrated approach to sharing information in an easy-to-use, highly visual, and personalized way n system helps promote a shared view of business activities due to integration of tools and distributed data/information n managers can get up-to-date information on industry news, competitor/market trends and internal operations

most successful MSS are developed as n 1. one aspect of a distributed, enterprise information system n 2.that enables flexible and integrated information sharing and communication n 3.both inside orgs. and with external suppliers, customers and other business partners.

1980s to 1990s n 1980s - managers had support tools designed to run on PCs (e.g. spreadsheets, statistical packages, graphics packages, word processing, project management, etc.) n 1990s - MSS provide integrated environment for these support tools

MSS n MSS usually designed so that individual manager can customize the system as needed n MSS architecture - client/server environment n one component of a distributed information infrastructure

Four levels of functionality in MSS n 1. electronic briefing books n 2. exception reporting n 3. active exploration of info. resources using n 4. focused management support

1. electronic briefing books n graphical information displays that provide pre-formatte d routine info. n displays stored as information categories (e.g. pricing, product)

2. exception reporting n critical info. outside range of pre-defined boundaries is highlighted n manager may be notified by system n some orgs. use traffic-light pattern for exception reporting –green = no problems –yellow = caution, marginal condition –red = trouble, needs immediate attention

3. active exploration of info. resources using n MSS can build queries to relational data bases based on point and click of managers n can move between internal and external DBs n integrate all different analysis tools

4. focused management support n focus support on key management activities or decisions (e.g. promotion planning, pricing) n requires integration of variety of sophisticated support tools customized for specific activity

Implementing an MSS n Four key categories of risk must be managed: n 1.need thorough understanding of individual, team, and organizational information requirements n 2.involves mega-change to formal and informal policies and practices for information management and communication information is power

Implementing an MSS n Four key categories of risk must be managed: n 3.implementation of an MSS should be considered an organizational change initiative need to manage the change n 4.must manage the simultaneous evolution of both the organization and the technological infrastructure

Past n Back in 1980s, management support tools consisted of stand-alone (e.g. not integrated!!) systems. n Two major types of support systems were (are) termed (1) DSS and (2) EIS/ESS. n Here’s some info. on these stand-alone systems.

1.Decision support systems n systems that support rather than replace "managers" in their decision-making activities n give decision maker access to data and models, but the intelligence, intuition, and judgment of the decision maker are integral parts of the system n DSS provide decision support - don't automatically make the decision. They help with the decision. n Primarily support planning function

Types of decisions  Organizational problems differ in terms of how structured the problems are  the extent to which a solution procedure can be stated  structured - routine, repetitive  unstructured - novel, nonroutine  semistructured - somewhere in between

DSS n DSS - computer system at management level that combines data, analytical models, and user-friendly software to support semistructured and unstructured decision making n give uses capability to analyze data - provide software tools n a DSS is focused on a specific decision

Can define DSS as  computer-based systems  that help decision makers  confront un-structured and semi- structured problems  through direct interaction  with data and analysis models

Differences between DSS and MIS n (note - MIS refers to formal systems developed by IS professionals; e.g. management reporting systems) n DSS - end-user control of data and tools n aimed at top and middle managers n emphasize change, flexibility and quick response iterative development process

Differences between DSS and MIS n MIS - dominated by IS professionals n focuses on structured information flows to n middle managers n traditional development process

Core DSS capabilities n representations - heavy use of graphs and charts n operations - mathematical manipulations of data (e.g. assigning risks, generating statistics, simulating alternatives) n memory aids - databases, views of data, work spaces, libraries n control aids - user control activities of the DSS; include software language for user control of representations, operations, and memory

DSS n DSS is a decision-making scratch pad, backed up by databases - used to support decision-making processes n can be applied to problems with quantifiable dimensions that provide criteria for evaluation of alternative solutions n helps DM identify best alternative

3 basic Components of DSS n 1.DSS database - collection of current or historical data which has been extracted from corporate databases; DSS manipulates live organizational data to support decision making n 2.model base - collection of mathematical and analytical models n model - abstract representation, e.g. statistical functions n sensitivity analysis - models that ask “what-if” questions to determine the impact of changes in one or more factors on outcomes n e.g. what is we increase price by 5%?

3 basic Components of DSS n 3.DSS software system - permits easy interaction between users and the DSS database and model base n Building a DSS - requires intense user interaction because customized to specific users and specific type of decision; must be flexible and able to evolve; use an iterative development method like prototyping

DSS Subsystems & The Capabilities They Offer Data Management Data Management for Retrieval Data Extraction from Internal and External Databases Model Management Creation, Maintenance, and Use of Models Dialog Management Menus, Icons, Natural Language, Graphics DSS on a Computer Platform Human Decision Maker User

models n Model is built by using a variety of assumptions about the relationship between its variables n by comparing alternatives (what if’s), you can vary the premises and compare the outcomes

DSS supports asking 2 types of questions n Scenario generation - what-if mode –user considers alternative scenarios and their results –e.g. what if advertising expenditures are increased by 5% n goal-seeking –user asks “what would it take in terms of input factors to achieve a particular outcome

Spreadsheets for decision support n very popular tools for decision support activities: n 1)based on familiar way to view data (table) and relationships between data take form of a report n 2)very easy to use n allow users to make corrections, additions, and deletions quickly and easily n can perform “what if” analyses by changing some values and viewing results

Spreadsheets for decision support n thousands of templates for spreadsheet packages to help users - templates are prepared spreadsheet models into which users only enter data - all relationships and calculating formulas are provided and in place

examples for financial planning  loan amortization  depreciation  lease versus buy  break-even analysis  discounted cash flows and net present value

Spreadsheets n about 20-30% of users will become dissatisfied with spreadsheets for decision support and will want more powerful tools, but many users will stay with spreadsheets as primary DSS, especially for smaller problems

Development & Adaptation of DSS Problem Definition by Users and Developers Development of Initial Prototype Prototype/DSS Evaluation Prototype/DSS Modification Validation and Documentation of DSS Are Current Requirements Satisfied? no DSS Ready for Use Develop- ment Loop Adaptation Loop yes

2.Executive support systems (ESS) n help senior level managers with unstructured problems dealing with monitoring and control functions  monitor organizational performance  track activities of competitors  spot problems  identify opportunities  forecast trends

ESS combines computing and communications n includes functions for providing summary performance data n data typically covers sales, production, earnings, budgets, and forecasts n uses graphics to display and visualize data in a very easy to use fashion n combine data from internal and external sources environmental scanning/alerting - for news on government regulations, competition, financial and economic developments, and scientific topics

ESS combines computing and communications n support electronic communications

ESS n used by both top level execs. and managers several levels below

Relationship between EIS and DSS UserTaskPrimary Support Areas EIS Executive Analyst/ Middle Manager Flow of Problems DSS Problem/Opportunity Discovery and Assessment Seeking Problem Solution: Decision-Making Process Monitoring and Control, Strategic Planning Planning