MIS Chapter 5 questions

Managers depend on the use of technology to support them with the decision making process.

Factors such as the increase in the number of alternatives, time constraints on how quickly a decision have to be made, the location of the information, and the complexity of the problem all create significant demands on the decision maker that simply could not be done without the use of technology.

There are several different types of decision support systems.

One is a sensitivity analysis which studies the impact that changes in one or more components of a decision-making model have on other components. A what-if analysis predicts the impact of a change in an assumption to a proposed solution. An example would be how quickly a loan could be paid off if an extra $50 was applied to the loan each month. A 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. An example is how many more units must be produced to increase sales revenue from $1 million to $1.5 million.

A decision follows three main phases in the Decision Making Process.

The first is the intelligence phase where you examine a situation, identify, and define the problem or opportunity. The next phase is the design phase. Here decision makers construct a model for addressing the situation and set criteria for evaluating all of the potential solutions that are proposed. The last phase is the choice phase which involves selecting a solution or course of action that seems best suited to resolve the problem and determining how to implement it. Once the choice has been made the solution is then implemented. A successful choice solves the problem or seizes the opportunity. If the choice fails, then the process returns to one of the previous phases. This process does not have to be linear as steps are sometimes repeated or even skipped depending on the complexity of the problem.

Decisions follow a specified framework for computers to follow in the decision making process.

The first part is the problem structure. A structured decision is one that deals with routine and repetitive problems. These are decisions that follow a specific sequence to come up with the most optimal solution and can easily be carried out by a computer. An example would be check processing at a bank. A unstructured decision is one which has no cut and dried perfect solution and often require subjective judgments and intuition to find a solution. These are decisions computers cannot make. A semistructured decision is a combination of the two in which part of the decision is structured and part of it is unstructured. The second part is the nature of the decision being made which can fall under one of three categories. One category is operational where specific tasks are executed efficiently and effectively. Another is management where resources are acquired and used efficiently to accomplish organizational goals. The third is strategic planning which covers long range goals and policies.

Any technology used to help make decisions can be considered

business intelligence, from something as simple as an Excel spreadsheet to a large data warehouse.

data visualization

information is presented to users in visual formats such as text, graphics, and tables following data processing.