Chapter 9 MIS

Inputs for TPS

Source documents, original transaction record

Unstructured decisions

Strategic decisions are highly unstructured decisions occurring in situations in which no procedures or rules exist to guide decision makers toward the correct choice.

What do they monitor? what are they? (not definition)

Strategic performance of the organization and its overall direction in the political, economic, and competitive business environment. Infrequent, extremely important, and typically related to long-term business strategy.

What type of decisions are made frequently? what are they in nature? What type of business strategies do they affect? Examples

Structured decisions Repetitive Short-term Reordering inventory or creating the employee staffing decisions

Analytics

The science of fact-based decisions making

Sensitivity analysis

a special case of what-if analysis, is the study of the impact on other variables when one variable is changed repeatedly. useful when users are uncertain about the assumptions made in estimating the value of certain key variables.

Optimization analysis

an extension of goal seeking analysis, finds the optimum value for a target variable by repeatedly changing other variables, subject to specified constraints. by changing revenue and cost variables in an optimization analysis, managers can calculate the highest potential profits.

Intelligent systems

are various commercial applications of AI. include sensors, software, and devices that emulate and enhance human capabilities learn or understand from experience, make sense of ambiguous or contradictory info and use reasoning to solve problems and make decisions.

Transaction processing system

basic business system that serves the operational level (analysts) and assist in making structured decision

what does MIS have the capability to do in regards to models?

capability and functionality to express far more complex modeling relationships that provide information, business intelligence, and knowledge.

Online transaction processing (OLTP)

capture of the transaction and event information using technology to 1- process the info according to defined business rule 2- store info 3- update existing info to reflect new info during OLTP the organization must capture ever transaction and detail of events.

What if analysis

checks the impact of a change in a variable or assumption on the model. users repeat this analysis with different variables until they understand all the effects of various situations.

Digital dashboard

common tool that supports visualization, which tracks KPIs and CSFs by compiling info from multiple source and tailoring it to meet user needs.

Virtual reality

computer-simulated environment that can be a simulation of the real world or an imaginary world. fast growing area of AI enables telepresence where users can be anywhere in the world and use virtual reality systems to work alone or together at a remote site.

Expert systems

computerized advisory program that imitate the reasoning processes of experts in solving difficult problems. expert systems are the most common form of AI in the business arena because they fill the gap when human experts are difficult to find or retain or are too expensive. The best-known systems play chess and assist in medical diagnosis.

Managerial level see figure 9.5 screenshot

employees are continuously evaluating company operations to hone the firms abilities to identify, adapt to, and leverage change.

Operational level see figure 9.4 screenshot

employees develop, control, and maintain core business activities required to run the day-to-day operations.

Goal seeking analysis

finds the inputs necessary to achieve a goal such as a desired level of output. it is the reverse of what-if analysis and sensitivity analysis

what does visualization produce?

graphical displays of patterns and complex relationships in large amounts of data.

multi agent system

groups of intelligent agents have the ability to work indecently and to interact with each other.

What do models help with?

help managers calculate risk, understand uncertainty, change variables, and manipulate time to make decisions

list of keys included in a dashboard designed for a manufacturing team

hot list of KPIs running line graphs of planned versus forecasted product prices and inventories. list of outstanding alerts and their resolution status graph of stock market prices

What do AI systems do?

increase speed, and consistency of decisions making, solve problems with incomplete info, and resolve complicated issues that cannot be solved by conventional computing.

mutation

is the prices within a genetic algorithm of randomly trying combinations and evaluating the success or failure of the outcome.

Neural network features

learning and adjusting to new circumstances on their own lending themselves to massive parallel processing functioning without complete or well-structured information coping with huge volumes of info with many dependent variables analyzing nonlinear relationships in info they have been called fancy regression analysis systems

Strategic level see figure 9.6 screenshot

managers develop overall business strategies, goals, and objectives as part of the companys strategic plan.

Online analytical processing (OLAP)

manipulation of information to create business intelligence in support of strategic decision-making

Fuzzy logic

mathematical method of handling imprecise or subjective info. the basic approach is to assign values between 0 and 1 to vague info. zero represents info not included while 1 represents inclusion or membership.

Shopping bot

most simple example of an intelligent agent it is a software that will search several retailer websites and provide a comparison of each retailers offerings and include pricing and availability.

artificial intelligence

simulates human thinking and behavior, such as the ability to reason and learn. its ultimate goal is to build a system that can mimic human intelligence.

intelligent agent

special purpose knowledge based info system that accomplishes specific tasks on behalf of its users. usually have a graphical representation. handle the majority of a companys internet buying and selling.

Executive information system

specialized DSS that supports senior level executives and unstructured, long-term, nonroutine decisions requiring judgment, evaluation, and insight.

augmented reality

viewing of the physical world, with computer-generate layers of information added to it.

what do executive relationships use?

visualization

What types of plans do managerial decisions cover? where do they allocate resources and monitor performance?

Short and medium term range plans, schedules,budgets, along with policies, procedures, and business objectives. Subunits, including departments, divisions, process teams, project teams.

Neural networks

aka artificial neural network attempts to emulate the way human brain works. analyze large quantities of info to establish patterns and characteristics in situations where logic or rules are unknown.

Genetic algorithm

an AI system that mimics the evolutionary, survival of the fittest process to generate increasingly better solutions to a problem. it is an optimizing system: it finds the combination of inputs that give the best outputs. best suited when thousands or millions of solutions are possible. works faster and more efficiently than any other human

most common transaction processing system?

payroll system or order-entry system

granularity

refers to the level of data in the model of the decision-making process. the greater the granularity, the deeper the level of detail fineness of data.

Model

simplified representation or abstraction of reality.

agent based modeling

way of simulating human organizations using multiple intelligent agents used to model stock market fluctuation, predict the escape routes people seek in a burning building, estimate the effect of interest rates on consumers with different types of debt, and anticipate how changes in conditions will affect the supply chain

Managerial Decision making challenges (3)

1- Managers need to analyze large amounts of information 2- managers must make decisions quickly 3- Managers must apply sophisticated analysis techniques such as porters strategies or forecasting, to make strategic decisions

Six step decision making process see screenshot for further detail

1- Problem identification 2- data collection 3-Solution generation 4- solution test 5- Solution selection 6- solution implementation

How scientists use AI

1- learn how people-based systems behave 2- predict how they will behave under a given set of circumstances 3- improve human systems to make them more efficient and effective

Key associated use of DSS

Analyzing complex relationships among thousands or even millions of data items to discover patterns, trends, and exception conditions.

Digital dashboard offer the following capabilities (and define each)

Consolidation: is the aggregation of data from simple roll-ups to complex groupings of interrelated info. Drill-down: enables users to view details, of details, of info reverse of consolidation Slice and dice: the ability to look at information from different perspectives

Most sought after traits in executives

Decision making problem solving

Decision-Enabling, problem-solving, and opportunity- seizing systems

Employees- executive information systems Customers- data mining Suppliers- Decision support systems & CRM Partners- ERP and SCM

5 categories of AI

Expert systems neural networks genetic algorithms intelligent agents virtual reality

How do MIS support systems rely on them?

For computational and analytical routines that mathematically express relationships, among variables.

What do DSSs enable?

High-level managers to examine and manipulate large amounts of detailed data from different internal and external sources.

Ebusiness

Is the conducting of business on the Internet, not only buying and selling, but also serving customers and collaborating with business partners

Decision support systems (DSSs)

Model information using OLAP, which provides assistance in evaluating and choosing among different courses of action

Semistructured decisions

Occur i situations in which a few established processes help to evaluate potential solutions, but not enough to lead to a definite recommended decision.

Common company structure pyramid from lowest to peak.

Operational Managerial Strategic (peak)

Structured Decisions

Operational decisions are considered structured decisions, which arise in situations where established processes offer potential solutions.