Preparing for the Future with Decision Support Systems Copyright © 2001 by Harcourt, Inc. All rights reserved

2001 Preparing for the Future Transactions Data Decisions Remember the Past (organizational memory) Remember the Past (organizational memory) Preparing for the Future (decision support systems) Preparing for the Future (decision support systems) Handling the Present (transaction processing system Handling the Present (transaction processing system People and Technology People and Technology

2001 D ecision S upport S ystems For “problem specific” decision Non-recurring decision “What-if” oriented –Interactive…run many scenarios Future oriented Source: TPS, MIS, External data Use statistical and modeling tools

2001 TYPES OF DSS MODEL - DRIVEN Stand - Alone System To Perform “What - If” And Other Analyses DATA - DRIVEN Allows User To Extract & Analyze Useful Information In Large Databases DATA MINING Finding Hidden Patterns & Relationships In Large Databases, Inferring Rules To Predict Future Behavior *

2001 Decision Making Process Define problem Gather information Identify alternatives Evaluate alternatives Select alternative Implement alternative Monitor results

2001 Uses of Information in Decision Making

2001 TYPES OF INFORMATION SYSTEMS SALES & MANUFACTURING FINANCE ACCOUNTING HUMAN KIND OF SYSTEM GROUPS SERVED KIND OF SYSTEM GROUPS SERVED STRATEGIC LEVEL SENIOR MANAGERS STRATEGIC LEVEL SENIOR MANAGERS MANAGEMENT LEVEL MIDDLE MANAGERS LEVEL MIDDLE MANAGERS OPERATIONAL LEVEL KNOWLEDGE LEVEL KNOWLEDGE & DATA WORKERS RESOURCESMARKETING

2001 Information-Based DSS Operational decisions Tactical decisions Strategic decisions

2001 Information-Based DSS Legend Information Summaries Drill Down External Information Operational Level Tactical Level Strategic Level

2001 Types of Reporting Scheduled –Historical –Generated or online –Periodic information Exception –If a condition occurs –Exceptional event (credit limit, password) On Demand –As needed –Current picture

2001 Model-based DSS Interaction Database Data Management System Model Management System Model Base User Interface

2001 Online Analytical Processing (OLAP) Software to extract and view data from various points of view –Time –Customers –Products Used with Data Warehousing Market Analysis Financial Forecasting

2001 Multidimensional Database

2001 Views of a Multidimensional Database

2001 Data mining –Search for relationships, patterns of interest Neural networks –Trained to look for patterns if none known

2001 Data Mining Approaches

2001 Data Mining Process 1. Understand application 2. Select target data 3. Reduce number of variables 4. Select data mining approach 5. Mine data 6. Interpret results 7. Generate report

PAST SLIDE NEXT SLIDE Copyright © 2001 by Harcourt, Inc. All rights reserved Coming next... Preparing for the Future with Electronic Commerce