Decision Support System by Simulation Model (Ajarn Chat Chuchuen) 1 Chapter 8 Enterprise Decision Support Systems

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)2 DSS to provide enterprise-wide support Executives Many decision makers in different locations Enterprise Resource Planning (ERP) systems Enterprise Decision Support Systems

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)3 Evolution of Executive and Enterprise Information Systems DSS and ODSS 1980s: Top execs get Executive Information Systems ’ s: Move to everybody ’ s information systems and enterprise information systems Definitions follow

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)4 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

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)5 Executive Support System (ESS) Comprehensive support system that goes beyond EIS to include Communications Office automation Analysis support Intelligence

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)6 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

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)7 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

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)8 The Decision Making Process of Executives (Decision Role) External environmentInternal environment Evaluation of information Qualitative analysisQuantitative analysis Interpretation: Is there a problem (opportunity)? Decision: What to do about the problem (opportunity) Yes Input for decision making Scanning No Scanning Phase I Phase II

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)9 Methods for Finding Information Need 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

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)10 Executive Information System (EIS) Quality of information User interface Technical capability provided Benefits Characteristics and Benefits

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)11 Executive Information System (EIS) Drill down Critical success Factors (CSF) Status access Analysis Exception reporting Colors and audio Navigation of information Communication Characteristics

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)12 Critical Success Factors (CSF) 1.Key problem narratives 2.Highlight charts 3.Top-level financials 4.Key factors (key performance indicators (KPI)) 5.Detailed KPI responsibility reports Monitored by five types of information

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)13 Typical Key Performance Indicators ProfitabilityProfitability measures for each department, product, region, comparisons among departments and products and with competitors FinancialFinancial ratios, balance sheet analysis, cash reserve position, ROI MarketingMarket shares, advertisement analysis, product pricing, weekly sales results Critical Success Factors (CSF)

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)14 Comparing and Integrating Tables 8.2 and 8.3 compare the two systems  Table DSS definitions related to EIS  Table Comparison of EIS and DSS EIS is part of decision support EIS and DSS

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)15 Integrating 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 EIS and Group Support Systems

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)16 Traditional EIS Software Major Commercial EIS Software Vendors  Comshare Inc. (  Pilot Software Inc. ( Application Development Tools  In-house components  Comshare Commander tools  Pilot Software ’ s Command Center Plus and Pilot Decision Support Suite

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)17 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

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)18 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.)

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)19 Including Soft Information in EIS Fuzzy Unofficial Intuitive Subjective Nebulous Implied Vague Soft information is

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)20 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%)

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)21 Soft Information Enhances EIS Value Intelligent Agents New Feeds Including Soft Information in EIS

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)22 Organizational DSS (ODSS) 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 Hackathorn and Keen (1981)

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)23 Organizational DSS (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) Definitions

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)24 Organizational DSS (ODSS) 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) Definitions

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)25 Organizational DSS (ODSS) 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 Common Characteristics (George, 1991)

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)26 Supply chain:  (originally) flow of materials from sources to internal use Demand chain:  flow from inside to customers Supply and Value Chains and Decision Support

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)27 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

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)28 Supply Chain Management (SCM) To deliver an effective supply chain and do it effectively To plan, organize, and coordinate the supply chain ’ s activities

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)29 Supply Chain Management (SCM) Reduction in uncertainty and risks in the supply chain Positively affect  inventory levels  cycle time  processes  customer service Increase profitability Benefits

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)30 Supply Chain Upstream Internal supply chain Downstream Involves product life cycle activities Example (Figure 8.2) Components

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)31 Supply Chain Related to the Value Chain Model (Porter) Value chain is a series of activities that includes  Inbound logistics  Warehousing & storage  Production  Finished inventory storage  Outbound logistics  Marketing & sales  Customer service

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)32 The Value Chain of a Manufacturing Company

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)33 Supply Chain Uncertainty in the demand forecast Uncertainty in delivery times Quality problems Poor customer service High inventory costs Low revenue Extra costs Problems

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)34 Supply Chain Outsourcing Buy, not make Configure optimal shipping plans Optimize purchasing Strategic partnerships with suppliers Just-in-time delivery of purchases Solutions to Problems

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)35 Supply Chain Reduce intermediaries Reduce lead times/use EDI Use fewer suppliers Improve the supplier-buyer relationships Build-to-order Accurate demand by working with suppliers Solutions to Problems

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)36 Computerized System MRP ERP SCM Integrating the supply chain

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)37 Enterprise Resource Planning (ERP) integrate all departments and functions across an organization into a single computer system that can serve the entire enterprise ’ s needs Objective

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)38 Enterprise Resource Planning (ERP) SAP Baan PeopleSoft Oracle J.D. Edwards Computer Associates Software Vendors

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)39 Enterprise Resource Planning (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

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)40 ASP:  software vendor who leases ERP-based applications Outsourcing Now via the Web Application Service Providers and ERP Outsourcing

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)41 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

Decision Support System by Simulation Model (Ajarn Chat Chuchuen)42 Frontline Decision Support Systems Process of automating decision processes and pushing them down into the organization and even partners Includes empowering employees Serves business managers such as line managers, sales executives and call center representatives Provides  the right questions to ask  the location of needed data  metrics  suggested actions