chapter 9: Enabling the Organization--Decison Making

The most information a business acquires, the more difficult it becomes to make decision.

Today, with massive volumes of available information it is almost impossible for people without the aid of information systems.

MODEL

A model is a simplified representation or abstraction of reality.

• Models can calculate risks, understand uncertainly , change variable, and manipulate time.

 Decision-making information systems work by building models out of organization information to lend insight into important business issues and opportunities.

Each system uses different models to assist in decision making, problem solving, and opportunity capturing. This system includes:

• Transaction Processing System.
• Decision Support Systems.
• Executive Information Systems.

Transaction Processing Systems

The structure of a typical organization is similar to a pyramid. Organizational activities occur at different levels of the pyramid. People in the organization have unique information needs and thus require various sets of IT tools.

- Online transaction processing is the manipulation of information to create business intelligence in support of strategic decision making

  

Decision Support System

A decision support system (DSS) models information to support managers and business professionals during the decision making process.

Three quantitative models are typically used by DSSs:

-Sensitivity analysis is the study of the impact that changes in one (or more) parts of the model have on other parts of the model.

-What-if analysis check the impact of change in an assumption on the proposed solution.

- Goal -seeking analysis finds the inputs necessary to achieve a goal such as a desired level of output.  

    

Executive Information Systems

-Consolidation involves the aggregation of information and features simple rollups to complex groupings of interrelated information.

-Drill-down enables users to get details, and details of details, of information viewing monthly, weekly, daily, or even hourly information represents drill down capability.

-Slide-and-dice is the ability to look at information from different perspectives.

DIGITAL DASHBOARDS

A common feature of EIA is digital dashboard. Digital dashboards integrate information from multiple components and tailor the information to individual preferences. Digital dashboards commonly use indicators to help executives quickly identify the status of the key information or critical success factors.

- Digital dashboards, whether basic or comprehensive, deliver results quickly.

- EIS systems such as digital dashboards, allow executives to move beyond reporting to using information to directly impact business performance.

- Digital Dashboards help executives react to information as it becomes available and make decision, solve problems, and change strategies daily instead of monthly.

Artificial Intelligence(AI)

Executive information systems are starting to take advantage of artificial intelligence to help executives make strategic decisions.

Phili Lumish said that competing in the internet arena is competing with the entire world rather than a store down the block or a few miles away.

- Intelligent Systems are various commercial applications of artificial intelligence. --

- Artificial intelligence (AI) simulates human intelligence such as ability to reason and learn.

AI systems dramatically increase the speed and consistency of decision making, solve problems with incomplete information, and solve complicated issues that cannot be solved by conventional computing. There are many categories of AI systems:

>>Expert System

>> Neural Networks

>>Genetic Algorithms

>> Intelligent agents

Expert system are computerized advisory program that imitate the reasoning processes of experts in solving difficult problems.

A neural Network, also called an artificial neural network, is a category of AI that attempts to emulate the way the human brain works.

Fuzzy logic: It is an artificial method of handing imprecise or subjective information.

A genetic algorithms is an artificial intelligence system that mimic the evolutionary, survival-of-the-fittest process to generate increasingly better solutions to a problem.

Intelligent agents is a special-purpose knowledge-based information system that accomplished specific task as on behalf of its users. A shopping both is simple example of an intelligent agent.

Shopping bot is the software that will search several retailer websites and provide a comparison of each retailer's offering including price and availability.

Multi-Agent Systems and Agent Modeling

By observing the ecosystem like ant or bee colonies, artificial intelligence scientists can use hardware and software models that incorporate insect characteristics and behavior to:

•  Learn how people-based system behave
• predict how they will behave under a given set of circumstances
•  improve human system to make them more efficient and effective.

This concept of learning from ecosystems and adapting their characteristics to human and organizational situations is called biomimicry.

 Data Mining

•  Data miming system sift instantly through the information to uncover patterns and relationships that would elude an army of human research.
•  Data-mining software typically includes many forms of AI such us networks and expert system

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