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CHAPTER 6
Executive Decision
Support Systems
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Enterprise Decision Support Systems
DSS to provide enterprise-wide support
Executives
Many decision makers in different locations
Enterprise Resource Planning (ERP) systems
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Enterprise Systems: Conceptsand Definitions
Executive information systems (EIS)
Executive support systems (ESS)
Enterprise information systems (EIS)
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DSS and ODSS
1980s: Top execs get Executive Information Systems
1995+’s: Move to everybody’s information systems and enterprise information systems
Definitions follow
Evolution of Executive and Enterprise Information Systems
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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
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Executive Support System (ESS)
Comprehensive support system that goes beyond EIS to include
Communications
Office automation
Analysis support
Intelligence
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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
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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
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Methods for Finding Information Needs
Wetherbe's Approach1. 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
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Characteristics of EIS
Drill down
Critical success Factors (CSF)
Status access
Analysis
Colors and audio
Navigation of information
Communication
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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
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Critical Success Factors
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Characteristics and Benefits of EIS
(Table 8.1)
Quality of information
User interface
Technical capability provided
Benefits
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Comparing and Integrating EIS and DSS
Tables 8.2 and 8.3 compare the two systems Table 8.2 - DSS definitions related to EIS
Table 8.3 - Comparison of EIS and DSS
EIS is part of decision support
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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
Integrating EIS and Group Support Systems
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Traditional EIS Software
Major Commercial EIS Software Vendors Comshare Inc. (www.comshare.com)
Pilot Software Inc. (www.pilotsw.com)
Application Development Tools In-house components
Comshare Commander tools
Pilot Software’s Command Center Plus and Pilot Decision Support Suite
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EIS
Data access
Data warehousing
OLAP
Multidimensional analysis
Presentations
Web
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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
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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.)
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Including Soft Information in EIS
Soft information is fuzzy, unofficial, intuitive, subjective, nebulous, implied, and vague
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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%)
Soft Information Enhances EIS Value
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Organizational DSS (ODSS)
Three Types of Decision Support Individual
Group
Organizational Hackathorn and Keen (1981)
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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
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Definitions of 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)
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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)
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Common Characteristics of ODSS (George, 1991)
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
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George, Nunamaker & Valacich, 1992: Classification of ODSS based on Key Issues
Downsizing: Reduction in the number
of human resources and hierarchical
layers- Keys to ODSS:
ODSS to act as knowledge filters and amplifiers
ODSS to handle increased communication caused by an
increase in the span of control
ODSS to integrate the gaps created by the missing Management
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George, Nunamaker & Valacich, 1992: Classification of ODSS based on Key Issues
Self-Managed Teams: This address the
gaps.
Need increased coordination tools: Groupware
Need increased flexibility in decision making
Need different types of people (for discussion)
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George, Nunamaker & Valacich, 1992: Classification of ODSS based on Key Issues
Outsourcing:
• Strategic versus tactical issues
• Coordination issues
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The Internet
Internet Server
Intranet Server
EIS Data, Model,
Knowledge Bases
Corporate Data,Model,
Knowledge Bases, etc.
User
Interface
Resident
OLAP
Tools
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Report
writing
software
GDSS
softwareMathematical
Models
Other
group
members
RDB
GDSS
software
Environment
Individual
problem
solvers
Decision
support
system
Environment
Legend: Data InformationCommunication
An EIS Architecture
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Decision Maker Views
Hypertext Links
Cognitive Style
Mental ModelsInfromation Sources
15
20
25
30
35
40
45
50
Column 1 Column 2 Column 3 Column 4
Row 1 Row 2 Row 3 Row 4
Column Title
Y1 Title
Row Title
TitleSubtitle
Note: This is the footnote
Outcomes
Cognitive Style
Mental Models
Nodes: data, models, knowledge
Links: relationships
bewteen nodes
The decision making-
intrepretation process
New link
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Management Decision Making Processess
0
10
20
30
40
50
60
70
80
90
1st Qtr 2nd
Qtr
3rd
Qtr
4th
Qtr
East
West
North
Intelligence
Design
Choice
Consensus
Generating
Dialectical
Inquiry
Strategy Formulation
Planning & Budgeting
Stakeholder
Communications
Performance
Measure ment &
Reporting
Technical Infrastructure Building
Human Resource Management
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MD
Data Base
Legacy
Systems
R DB’s SQL
GroupWare/GSS
Business
Processess
Business Forecasting
Organizational Structures
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Environmentally
Collected & Scanned Information:
Internal/External
Problem &
Opprotunity
Data Base
Process
Tool Data Base
Business
Process
Redesigns
Problem
Identification:
Intelligence
Normative
Design
Descriptive
Design
Decision
Choice
Implementation/Outcomes
Target IS
ESS Architecture
DeSanctis and Gallupe, 1985
Turban and Watson, 1989
Teng, Kettinger, and Guha, 1992
Chen, 1995
This paper
Repository
Repository-Based EIS
Interface
Development Tools
GSS
Interface
Data
Base
Model
Base
Process
Support
GSS Structure
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Business Strategy
Process SelectionProcess Tool
Data Base
Process Vision
Process ObjectivesProcess
Attributes
Enabling Technology
EIS
ESS
GSS
DSS
CMC
Strategies to
Processes
Adapted from Davenport, 1993
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Supply and Value Chains and Decision Support
Supply chain: (originally) flow of materials from sources to internal use
Demand chain: flow from inside to customers
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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
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Supply Chain Management (SCM)
To deliver an effective supply chain and do it effectively
To plan, organize, and coordinate the supply chain’s activities
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SCM Benefits
Reduction in uncertainty and risks in the supply chain
Positively affect inventory levels cycle time processes customer service
Increase profitability
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Supply Chain Components
Upstream
Internal supply chain
Downstream
Involves product life cycle activities
Example (Figure 8.2)
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Supply ChainRelated to Porter’s (1985)Value Chain
1. Inbound logistics (inputs)
2. Operations (i.e manufacturing)
3. Outbound logistics (i.e. storage, distribution)
4. Marketing and Sales
5. Service
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Supply Chain Problems
Uncertainty in the demand forecast
Uncertainty in delivery times
Quality problems
Poor customer service
High inventory costs
Low revenue
Extra costs
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Solutions to Supply Chain Problems
Outsourcing Buy, not make Configure optimal shipping plans Optimize purchasing Strategic partnerships with suppliers Just-in-time delivery of purchases Reduce intermediaries Reduce lead times (EDI) Use fewer suppliers Improve the supplier-buyer relationships Build-to-order Accurate demand by working with suppliers
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Computerized Systems
MRP
ERP
SCM
Integrating the supply chain
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Enterprise Resource Planning (ERP)
Objective: integrate all departments and functions across an organization into a single computer system that can serve the entire enterprise’s needs
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ERP Software Vendors
SAP
Baan
PeopleSoft
Oracle
J.D. Edwards
Computer Associates
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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
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Application Service Providers and ERP Outsourcing
ASP: software vendor who leases ERP-based applications
Outsourcing
Now via the Web
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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
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Frontline Decision Support Systems
Process of automating decision processes and pushing them down into the organization and even partners
Includes empowering employees
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Future of Executive and Enterprise Support Systems
Toolbox for customized systems Multimedia support Better access (via PDFs and cell phones) Virtual Reality and 3-D Image Displays Merging of analytical systems (OLAP / multidimensional
analysis)) with desktop publishing Client/server architecture Web-enabled EIS Automated support and intelligent assistance Integration of EIS and Group Support Systems Global EIS Integration and deployment with ERP products