Dig Tech in Business Chapter 5

Excel

The most popular BA tool by far. For years, BA vendors "fought" against the use of this. Eventually, however, they decided to "join it" by designing their software so that it interfaces with this

The Decision Matrix

The three primary classes of problem structure and the three broad categories of the nature of decisions can be combined in a decision-support matrix that consists of nine cells

Geographic Information System (GIS)

a computer based system for capturing, integrating, manipulating, and displaying data using digitized maps. Its most distinguishing characteristic is that every record or digital object has an identified geographical location. This process, called geocoding, enables users to generate information for planning, problem solving, and decision making. (data visualization technologies)

Management

a process by which organizational goals are achieved through the use of resources.

Management Control

acquiring and using resources efficiently in accomplishing organizational goals.

Expert Systems

attempt to duplicate the work of human experts by applying reasoning capabilities, knowledge, and expertise within a specific domain

Decision support systems (DSSs)

combine models and data to analyze semi structured problems and some unstructured problems that involve extensive user involvement. They enable business managers and analysts to access data interactively, to manipulate these data, and to conduct appropriate analyses.

Data Visualization

data presented to users in visual formats such as text, graphics, and tables following data processing. This makes IT applications more attractive and understandable to users.

Design Phase

decision makers construct a model for addressing the situation. They perform this task by making assumptions that simplify reality and by expressing the relationships among all of the relevant variables. Managers then validate the model by using test data. Finally, decision makers set criteria for evaluating all of the potential solutions that are proposed.

Decisional roles

entrepreneur, disturbance handler, resource allocator, negotiator

Operational Control

executing specific tasks efficiently and effectively.

Interpersonal roles

figurehead, leader, liaison

Business intelligence (BI)

has been defined as a broad category of applications, technologies, and processes for gathering, storing, accessing, and analyzing data to help business users make better decisions. Many experts argue that the terms should be used interchangeably.

Real-Time Business Analytics

includes the use of real time data for analysis as it is created rather than using historical data for analysis.

Choice Phase

involves selecting a solution or course of action that seems best suited to resolve the problem. This solution (the decision) is then implemented.

Management Cockpit

is a strategic management room containing an elaborate set of dashboard that enable top-level decision makers to pilot their businesses better; a registered trademark of SAP, created by Professor M. Georges)

Implementation Phase

is successful if the proposed solution solves the problem or seizes the opportunity. If the solution fails, then the process returns to the previous phases. Computer-based decision support assists managers in the decision-making process

Sensitivity Analysis

is the study of the impact that changes in one or more parts of a decision-making model have on other parts.

Intelligence Phase

managers examine a situation and then identify and define the problem or opportunity.

Informational roles

monitor, disseminator, spokesperson, analyzer

Dashboard

provides easy access to timely information and direct access to management reports. They evolved from executive information systems, which were information systems designed specifically for the information needs of top executives

Decision

refers to a choice among two or more alternatives that individuals and groups make. Decisions are diverse and are made continuously. Decision making is a systematic process

Data Mining

refers to the process of searching for valuable business information in a large database, data warehouse, or data mart. It can perform two basic operations: (1) predicting trends and behaviors and (2) identifying previously unknown patterns. Business analytics applications typically provide users with a view of what has happened; so this helps to explain why it is happening, and it predicts what will happen in the future.

Exception reporting

reports that highlight deviations larger than certain thresholds. reports may include only deviations

Goal-Seeking Analysis

represents a "backward" solution approach. It attempts to calculate the value of the inputs necessary to achieve a desired level of output.

Trend analysis

short, medium and long-term trend of KPIs or metrics, which are projected using forecasting methods

Models

simplified representations, or abstractions, of reality.

Drill down

the ability to go to details, at several levels; it can be done by a series of menus or by clicking on a drill-able portion of the screen

Data Reduction

the conversion of raw data into a smaller amount of more useful information.

Critical success factors (CSF's)

the factors most critical for the success of business. These can be organizational, industry, departmental, or the individual workers

Status access

the latest data available on KPI or some other metric, often in real time

Strategic Planning

the long-range goals and policies for growth and resource allocation.

Business analytics (BA)

the process of developing actionable decisions or recommendations for actions based on insights generated from historical data. It examines data with a variety of tools and techniques, formulates descriptive, predictive, and prescriptive models, and communicates these results to organizational decision makers.

Productivity

the ratio between the inputs to a process and the outputs from that process

Key performance indicators

the specific measures of CSFs.

Unstructured Decisions

they are intended to deal with "fuzzy," complex problems for which there are no cut-and-dried solutions.

Structured Decisions

they deal with routine and repetitive problems for which standard solutions exist, such as inventory control.

Semi structured Decisions

they require a combination of standard solution procedures and individual judgment; ex: evaluating employees, setting marketing budgets for consumer products

Problem Structure

where decision-making processes fall along a continuum ranging from highly structured to highly unstructured.

Online Analytical Processing (OLAP)

(also referred to as Multidimensional Analysis) involves "slicing and dicing" data stored in a dimensional format, drilling down in the data to greater detail, and aggregating the data. Provides users with a look at what is happening or what has happened. Allows users to analyze multidimensional data

Predictive Analytics

(show what is next) utilize a variety of analytics techniques and tools to examine recent and historical data in order to detect patterns and predict future outcomes and trends. It provides estimates about the likelihood of a future outcome. The purpose is not to tell decision makers what will happen in the future but it is supposed to give you a forecast of what might happen in the future.

Prescriptive Analytics

(show what to do) go beyond descriptive and predictive models by recommending one or more courses of action and showing the likely outcome of each decision. It does not predict one possible future, but rather multiple future outcomes based on the decision maker's actions

Descriptive Analytics

(show where we are) summarize what has happened in the past and allow decision makers to learn from past behaviors. Common examples of this are reports that provide historical insights regarding an organization's production, financials, operations, sales, finance, inventory, and customers.

Phases of the Decision-Making Process

-Intelligence phase -Design phase -Choice phase -Implementation phase

The Scope of Business Analytics

-The Development of One or a Few Related Analytics Applications -The Development of Infrastructure to Support Enterprise-wide Analytics -Support for Organizational Transformation

Why Managers Need IT Support

-The number of alternatives to be considered constantly increases. -Most decisions must be made under time pressure. -Decisions are more complex. -Decision makers can be in different locations and so is the information. -Increased uncertainty requires sophisticated analyses -Group decision making required without incurring major expenses

The Capabilities of Dashboards:

-drill down -critical success factors (CSFs) -Key performance -status access -trend analysis -exception reporting

What-If Analysis

A model builder must make predictions and assumptions regarding the input data, many of which are based on the assessment of uncertain futures. The results depend on the accuracy of these assumptions, which can be highly subjective.

Nature of Decisions

All managerial decisions fall into one of three broad categories: -Operational Control -Management Control -Strategic Planning

Reality Mining

Graphical Information Systems (GIS) and Geographic Positioning Systems (GPS) together to produce an interesting new type of technology which allows analysts to extract information from the usage patterns of mobile phones and other wireless devices. (data visualization technologies)

Functional area information systems (FAIS)

IS's that support a particular functional area within the organization