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5 Chapter 12
Enhancing Management Decision
Making for the Digital Firm
12.1 ©0008 by Preece ادنلا"
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سوه
How can information systems help
individual managers make better
decisions when the problems are
nonroutine and constantly changing?
. How can information systems help
people working in a group make
decisions more efficiently?
©0006 by Prevace “I
1
12.2
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سوه
Are there any special systems that can
facilitate decision making among
senior managers? Exactly what can
these systems do to help high-level
management?
What value can systems to support
management decision making provide
for the organization as a whole?
©0006 by Prevace “I
3)
4.
12.3
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Oe Ola ree
1. Building information systems that can
actually fulfill executive information
requirements
2. Create meaningful reporting and
management decision-making
processes
12.4 ©0008 by Preece ادنلا"
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00 rece (NCIC)
* Computer system at the management
level of an organization
٠ Combines data, analytical tools, and
models
* Supports semistructured and
unstructured decision making
125 ©0008 by Prevece We
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O16 wad DOC
MIS
٠ Provides reports based on routine flow
of data
* Assists in general control of the
organization
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O16 wad DOC
DSS
* Emphasizes change, flexibility, rapid
response, models, assumptions, ad-hoc
queries, and display graphics
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Types of Orv Cupp Cystews
Model-Driven DSS
* Primarily stand-alone
¢ Uses model to perform “what-if” and
other kinds of analysis
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Types of Orv Cupp Cystews
* Data-driven DSS: Supports decision
making by allowing users to extract and
analyze useful information previously
buried in large databases
۰ Datamining: Finds hidden patterns and
relationships in large databases to infer
rules from them and predict future
behavior
ما سم by 0008© 12.9
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Ordo oa Orquctraious
Data Drive Customer Care at
Intrawest
* How does this customer care DSS help
Intrawest make decisions?
¢ How has it provided value for the firm?
12.10 ©0008 by Preece ادنلا"
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Types of Orv Cupp Cystews
¢ Associations: Occurrences linked to a
single event
* Sequences: Events linked over time
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Types of Orv Cupp Cystews
* Classification: Recognizing patterns
that describe the group to which an item
belongs
* Clustering: Similar to classification
when no groups have yet been defined.
Discovers different groupings within data
pie ©0008 by ما سم
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Overview ۴ ۰ جمججمووط svete (DOO)
Overview of a decision-support system (DSS)
eno
foes
rower
Peo
Prue (6-0
12.14 ©0008 by ما سم
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Cowpens oP OGG
* DSS Database: Collection of current
or historical data from a number of
applications or groups. Can be a small
PC database or a massive data
warehouse
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Cowpens oP OGG
* DSS Software System: Collection of
software tools used for data analysis,
such as OLAP tools, datamining tools,
or a collections of mathematical and
analytical models
12.16 ©0008 by Prevece We
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ae متا مس ما متا
مت ماس اس مس رس ده وت وت 7
00
Cowpens oP OGG
* Model: Abstract representation
illustrating components or
relationships of a phenomenon
¢ Sensitivity Analysis: Models that ask
“what-if” questions repeatedly to
determine the impact of changes in
one or more factors on the outcomes
12.17 ©0008 by Prevece We
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00 rece (NCIC)
otal fixed costs 19000
Variable cost per unit 3
Average sales price 17
Contribution margin 14
Breakeven point 1387
Variable Cost per Unit
Sales 1387 2 3 4 5 0
Price [14 ۱583 ۰ ۱727 ۰ 1900212378
۷ ۰ 199۵ ۰ ۱727 ۰ ۱5۵3 ۰ 1462 وا
۵ ۰ ۱727 . ۱583 14642 ۱397 ۱6
۶ ۰ ۱588 ۱4۵2 . ۱3۶7 ۱260 ۱7
35714621583 12647 1188 18
و سب
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OCG Opphectow wad the Digit Piro
Examples of Decision-Support Systems
* General Accident Insurance: Customer
buying patterns and fraud detection
¢ Bank of America: Customer profiles
¢ Frito-Lay, Inc.: Price, advertising, and
promotion selection
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OCG Opphectocs werd the مسو لب
Examples of Decision-Support Systems
* Southern Railway: Train dispatching and
routing
* Texas Oil and Gas Corporation: Evaluation of
potential drilling sites
٠ The Gap: Inventory stocking and
merchandising
12.20 ©0008 by Preece ادنلا"
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eae Mi ems ca ee را تست
ا 4
00 rece (NCIC)
OCG Opphectow wad the Digit Piro
Examples of Decision-Support
Systems
* United Airlines: Flight scheduling,
passenger demand forecasting
¢ U.S. Department of Defense: Defense
contract analysis
12.21 ©0008 by Preece ادنلا"
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00 rece (NCIC)
OGG Por Prictry Devoe
* By analyzing several years of sales data
for similar items, the software estimates
a “seasonal demand curve” for each
item and predicts how many units would
sell each week at various prices.
¢ The software uses sales history to
predict how sensitive customer demand
will be to price changes
12.22 ©0008 by Preece ادنلا"
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اجه( 0۵ راب6 ۴ 0866
* Can help firms model inventory
stocking levels, production schedules,
or transportation plans
* Can provide firms with information on
key performance indicators such as
lead time, cycle time, inventory turns,
or total supply chain costs
12.23 ©0008 by Preece ادنلا"
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Ondow va Teck
A DSS Makes Subaru More Parts-
Savvy
* How does the Servigistics system
provide value for Subaru of New
England?
* How did it change the way the company
ran its business?
12.24 ©0008 by Preece ادنلا"
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O66 Por net wer wet wad secre
Analysis
Use statistical analysis.
to dently the top 25%
of frequent shoppers
Establish correlation
between location and
sales frequency
Verify new customer
segmencs
* frequent customers not
living near a store
+ frequent customers
living near a store
‘infrequent customers
living near a store
Query the database
for detailed information
fon each customer
©0006 by Prevace “I
Questions
|.Who are our most. <——>| جما
frequent customers?
eee
2, Do they ie close ro
‘our retail outlets? ده
3. How can we re-segment
those customers?
4, How can we berter
reach those segments?
06-6 سب
12.25
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OGG Por Cwtewer Rettiowhip )1( مجه
Predictive Analysis
٠ Use of datamining techniques,
historical data, and assumptions
about future conditions to predict
outcomes of events
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00 rece (NCIC)
Booyropht “Purana Oystrws (B10) لب سح م۳
Data Visualization: Technology for
helping users see patterns and
relationships in large amounts of data
by presenting the data in graphical
form.
Geographic Information System (GIS):
System with software that can analyze
and display data using digitized maps to
enhance planning and decision making
©0008 by Preece ادنلا"
12.27
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Orb-Bwsred Owtower Dever Oupport Gystews
Customer Decision-Support System
(CDSS)
٠ System to support the decision-
making process of an existing or
potential customer
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۵۳ ۰ 7
Group Decision-Support System
(GDSS): An interactive computer-
based system to facilitate the solution
to unstructured problems by a set of
decision makers working together as
a group
©0008 by Preece ادنلا"
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Hardware: Conference facility,
electronic hardware
Software tools: Tools for organizing
ideas, gathering information, and
ranking and seeking priorities
People: Participants, trained facilitator,
staff supporting hardware and software
©0006 by Prevace “I
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* Electronic questionnaires
٠ Electronic brainstorming tools
۰ Idea organizers
٠ Questionnaire tools
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06 ۶و 0
٠ Tools for voting or setting priorities
٠ Stakeholder identification and analysis
tools
¢ Policy formation tools
¢ Group dictionaries
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Overvew oP a BOO Ovvtey
٠ Each attendee has a workstation
٠ Workstations are networked and connected to
the facilitator’s console
٠ Data the attendees forward to the group are
collected and saved on a file server
٠ Facilitator projects computer images onto the
projection screen
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ع ]
06-6 صعب
ما" by Previce 0008©
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‘Low BOC Cus 1۶ Crow Devers Dchiery
¢* Number of attendees can increase while
productivity increases
¢ More collaborative atmosphere
٠ Software tools follow structured methods
for organizing and evaluating ideas and
preserving the results of meetings
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‘Low BOC Cus 1۶ Crow Devers Dchiery
Increase the number of ideas
generated
Can lead to more participative and
democratic decision making
©0006 by Prevace “I
12.36
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‘Low BOC Cus 1۶ Crow Devers Dchiery
Organizational Memory
٠ Store learning from an organization’s
history that can be used for decision
making and other purposes
12.37 ©0008 by Preece ادنلا"
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CRC at وه
Crovive Gupport Gystews (EGG)
٠ Focus on the information needs of senior
management
٠ Combine data from internal and external
sources
* Create a generalized computing and
communications environment that can be
focused and applied to a changing array
of problems
12.38 ©0008 by Preece ادنلا"
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CRC at وه
Crovive Gupport Gystews (EGG)
٠ Monitor organizational performance
٠ Track activities of competitors
٠ Spot problems
٠ Identify opportunities
٠ Forecast trends
12.39 ©0008 by Preece ادنلا"
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CRC at وه
The Roe oP @xevutve Gupport Gystews ta the Organization
٠ Bring together data from the entire
organization
٠ Allow managers to select, access, and
tailor data
* Enable executive and any subordinates
to look at the same data in the same
way
12.40 ©0008 by Preece ادنلا"
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CRC at وه
The Roe oP @xevutve Gupport Gystews ta the Organization
Drill Down
٠ The ability to move from summary
data to lower and lower levels of
detail
uae ©0008 by Prevece We
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CRC at وه
The Roe oP @xevutve Gupport Gystews ta the Organization
Developing ESS
٠ Ease of use
٠ Facility for environmental scanning
¢ External and internal sources of
information to be used for
environmental scanning
12.42 ©0008 by Preece ادنلا"
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CRC at وه
Oystews بمب شحو و سس
Analyze, compare, and highlight
trends
Provide greater clarity and insight
into data
Speed up decision making
©0006 by Prevace “I
12.43
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Oystews بمب شحو و سس
* Improve management performance
٠ Increase management’s span of
control
٠ Better monitoring of activities
12.44 ©0008 by Preece ادنلا"
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Gxevuve Gupport Opstews und the Oigid Piro
ESS for Competitive Intelligence
٠ Identify changing market conditions
* Formulate responses
٠ Track implementation efforts
¢ Learn from feedback
12.45 ©0008 by Preece ادنلا"
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Exenive Guppont Gystews und the Died Pro
Balanced Scorecard
* Model for analyzing firm performance
that supplements traditional financial
measures with measurements from
additional business perspectives,
such as customers, internal business
processes, and learning and growth
12.46 ©0008 by Preece ادنلا"
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Oe See
Crterprie-Onte Reportog wad odor
Strategic performance management
tools
for enterprise systems
٠ SAP: Web-enabled mySAP.com™,
Management Cockpit
* PeopleSoft: Web-enabled Enterprise
Performance Management (EPM)
12.47 ©0008 by Preece ادنلا"
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CRC at وه
Crterprie-Onte Reportog wad odor
Activity-Based Costing
Model for identifying all the company
activities that cause costs to occur
while producing a specific product or
service so that managers can see
which products or services are
profitable or losing money and make
changes to maximize firm profitability
©0008 by Preece ادنلا"
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س8 د02 © ۱9
Land's vat Ookeqaa Gua: ® Te ۴ ۲ مب 008
Analyze Harrah’s and Mohegan Sun
using the competitive forces and value
chain models.
Compare the business strategies of
Harrah’s and Mohegan sun. What role
do customer reward systems play in
these strategies? How are they
similar? How are they different?
©0006 by Prevace “I
1.
12.49
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س8 د02 © ۱9
Land's vat Ookeqaa Gua: ® Te ۴ ۲ مب 008
What kind of decision-support systems did
Harrah’s and Mohegan Sun develop? How
are they related to their business strategy?
Are Harrah’s and Mohegan Sun successful?
Which casino is more successful? Why? Can
its competitive advantage be sustained? Why
or why not?
Are there any ethical problems raised by
these casinos’ use of customer data? Explain
your response.
©0006 by Prevace “I
12.50
Chapter 12
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Enhancing Management Decision
Making for the Digital Firm
12.1
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Objectives
1. How can information systems help
individual managers make better
decisions when the problems are
nonroutine and constantly changing?
2. How can information systems help
people working in a group make
decisions more efficiently?
12.2
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Objectives
3. Are there any special systems that can
facilitate decision making among
senior managers? Exactly what can
these systems do to help high-level
management?
4. What value can systems to support
management decision making provide
for the organization as a whole?
12.3
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Management Challenges
1. Building information systems that can
actually fulfill executive information
requirements
2. Create meaningful reporting and
management decision-making
processes
12.4
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
• Computer system at the management
level of an organization
• Combines data, analytical tools, and
models
• Supports semistructured and
unstructured decision making
12.5
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
MIS and DSS
MIS
• Provides reports based on routine flow
of data
• Assists in general control of the
organization
12.6
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
MIS and DSS
DSS
• Emphasizes change, flexibility, rapid
response, models, assumptions, ad-hoc
queries, and display graphics
12.7
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Types of Decision-Support Systems
Model-Driven DSS
• Primarily stand-alone
• Uses model to perform “what-if” and
other kinds of analysis
12.8
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Types of Decision-Support Systems
• Data-driven DSS: Supports decision
making by allowing users to extract and
analyze useful information previously
buried in large databases
• Datamining: Finds hidden patterns and
relationships in large databases to infer
rules from them and predict future
behavior
12.9
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Window on Organizations
Data Drive Customer Care at
Intrawest
• How does this customer care DSS help
Intrawest make decisions?
• How has it provided value for the firm?
12.10
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Cargo revenue optimization of Continental Airlines
Figure 12-1
12.11
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Types of Decision-Support Systems
• Associations: Occurrences linked to a
single event
• Sequences: Events linked over time
12.12
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Types of Decision-Support Systems
• Classification: Recognizing patterns
that describe the group to which an item
belongs
• Clustering: Similar to classification
when no groups have yet been defined.
Discovers different groupings within data
12.13
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Overview of a decision-support system (DSS)
Figure 12-2
12.14
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Components of DSS
• DSS Database: Collection of current
or historical data from a number of
applications or groups. Can be a small
PC database or a massive data
warehouse
12.15
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Components of DSS
• DSS Software System: Collection of
software tools used for data analysis,
such as OLAP tools, datamining tools,
or a collections of mathematical and
analytical models
12.16
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Components of DSS
• Model: Abstract representation
illustrating components or
relationships of a phenomenon
• Sensitivity Analysis: Models that ask
“what-if” questions repeatedly to
determine the impact of changes in
one or more factors on the outcomes
12.17
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Sensitivity analysis
Figure 12-3
12.18
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
DSS Applications and the Digital Firm
Examples of Decision-Support Systems
• General Accident Insurance: Customer
buying patterns and fraud detection
• Bank of America: Customer profiles
• Frito-Lay, Inc.: Price, advertising, and
promotion selection
12.19
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
DSS Applications and the Digital Firm
Examples of Decision-Support Systems
• Southern Railway: Train dispatching and
routing
• Texas Oil and Gas Corporation: Evaluation of
potential drilling sites
• The Gap: Inventory stocking and
merchandising
12.20
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
DSS Applications and the Digital Firm
Examples of Decision-Support
Systems
• United Airlines: Flight scheduling,
passenger demand forecasting
• U.S. Department of Defense: Defense
contract analysis
12.21
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
DSS for Pricing Decisions
• By analyzing several years of sales data
for similar items, the software estimates
a “seasonal demand curve” for each
item and predicts how many units would
sell each week at various prices.
• The software uses sales history to
predict how sensitive customer demand
will be to price changes
12.22
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
DSS for Supply Chain Management
• Can help firms model inventory
stocking levels, production schedules,
or transportation plans
• Can provide firms with information on
key performance indicators such as
lead time, cycle time, inventory turns,
or total supply chain costs
12.23
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Window on Technology
A DSS Makes Subaru More PartsSavvy
• How does the Servigistics system
provide value for Subaru of New
England?
• How did it change the way the company
ran its business?
12.24
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
DSS for customer analysis and segmentation
Figure 12-4
12.25
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
DSS for Customer Relationship Management
Predictive Analysis
•
12.26
Use of datamining techniques,
historical data, and assumptions
about future conditions to predict
outcomes of events
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Data Visualization and Geographic Information Systems (GIS)
•
Data Visualization: Technology for
helping users see patterns and
relationships in large amounts of data
by presenting the data in graphical
form
•
Geographic Information System (GIS):
System with software that can analyze
and display data using digitized maps to
enhance planning and decision making
12.27
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Decision-Support Systems (DSS)
Web-Based Customer Decision-Support Systems
Customer Decision-Support System
(CDSS)
• System to support the decisionmaking process of an existing or
potential customer
12.28
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Group Decision-Support Systems (GDSS)
What is a GDSS?
•
12.29
Group Decision-Support System
(GDSS): An interactive computerbased system to facilitate the solution
to unstructured problems by a set of
decision makers working together as
a group
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Group Decision-Support Systems (GDSS)
Components of GDSS
•
Hardware: Conference facility,
electronic hardware
•
Software tools: Tools for organizing
ideas, gathering information, and
ranking and seeking priorities
•
People: Participants, trained facilitator,
staff supporting hardware and software
12.30
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Group Decision-Support Systems (GDSS)
Components of GDSS
•
Electronic questionnaires
•
Electronic brainstorming tools
•
Idea organizers
•
Questionnaire tools
12.31
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Group Decision-Support Systems (GDSS)
Components of GDSS
•
Tools for voting or setting priorities
•
Stakeholder identification and analysis
tools
•
Policy formation tools
•
Group dictionaries
12.32
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Group Decision-Support Systems (GDSS)
Overview of a GDSS Meeting
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Each attendee has a workstation
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Workstations are networked and connected to
the facilitator’s console
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Data the attendees forward to the group are
collected and saved on a file server
•
Facilitator projects computer images onto the
projection screen
12.33
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Group Decision-Support Systems (GDSS)
Group system tools
Figure 12-5
12.34
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Group Decision-Support Systems (GDSS)
How GDSS Can Enhance Group Decision Making
•
Number of attendees can increase while
productivity increases
•
More collaborative atmosphere
•
Software tools follow structured methods
for organizing and evaluating ideas and
preserving the results of meetings
12.35
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Group Decision-Support Systems (GDSS)
How GDSS Can Enhance Group Decision Making
•
Increase the number of ideas
generated
•
Can lead to more participative and
democratic decision making
12.36
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Group Decision-Support Systems (GDSS)
How GDSS Can Enhance Group Decision Making
Organizational Memory
•
12.37
Store learning from an organization’s
history that can be used for decision
making and other purposes
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
Executive Support Systems (ESS)
•
Focus on the information needs of senior
management
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Combine data from internal and external
sources
•
Create a generalized computing and
communications environment that can be
focused and applied to a changing array
of problems
12.38
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
Executive Support Systems (ESS)
•
Monitor organizational performance
•
Track activities of competitors
•
Spot problems
•
Identify opportunities
•
Forecast trends
12.39
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
The Role of Executive Support Systems in the Organization
•
Bring together data from the entire
organization
•
Allow managers to select, access, and
tailor data
•
Enable executive and any subordinates
to look at the same data in the same
way
12.40
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
The Role of Executive Support Systems in the Organization
Drill Down
•
12.41
The ability to move from summary
data to lower and lower levels of
detail
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
The Role of Executive Support Systems in the Organization
Developing ESS
•
Ease of use
•
Facility for environmental scanning
•
External and internal sources of
information to be used for
environmental scanning
12.42
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
Benefits of Executive Support Systems
•
Analyze, compare, and highlight
trends
•
Provide greater clarity and insight
into data
•
Speed up decision making
12.43
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
Benefits of Executive Support Systems
•
Improve management performance
•
Increase management’s span of
control
•
Better monitoring of activities
12.44
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
Executive Support Systems and the Digital Firm
ESS for Competitive Intelligence
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Identify changing market conditions
•
Formulate responses
•
Track implementation efforts
•
Learn from feedback
12.45
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
Executive Support Systems and the Digital Firm
Balanced Scorecard
•
12.46
Model for analyzing firm performance
that supplements traditional financial
measures with measurements from
additional business perspectives,
such as customers, internal business
processes, and learning and growth
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
Enterprise-Wide Reporting and Analysis
Strategic performance management
tools
for enterprise systems
•
SAP: Web-enabled mySAP.com™,
Management Cockpit
•
PeopleSoft: Web-enabled Enterprise
Performance Management (EPM)
12.47
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Executive Support in the Enterprise
Enterprise-Wide Reporting and Analysis
Activity-Based Costing
•
12.48
Model for identifying all the company
activities that cause costs to occur
while producing a specific product or
service so that managers can see
which products or services are
profitable or losing money and make
changes to maximize firm profitability
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Chapter 12 Case Study
Harrah’s and Mohegan Sun: A Tale of Two Casino DSS
1. Analyze Harrah’s and Mohegan Sun
using the competitive forces and value
chain models.
2. Compare the business strategies of
Harrah’s and Mohegan sun. What role
do customer reward systems play in
these strategies? How are they
similar? How are they different?
12.49
© 2005 by Prentice Hal
Essentials of Management Information Systems, 6e
Chapter 12 Enhancing Management Decision Making for the Digital Firm
Chapter 12 Case Study
Harrah’s and Mohegan Sun: A Tale of Two Casino DSS
3.
What kind of decision-support systems did
Harrah’s and Mohegan Sun develop? How
are they related to their business strategy?
4.
Are Harrah’s and Mohegan Sun successful?
Which casino is more successful? Why? Can
its competitive advantage be sustained? Why
or why not?
5.
Are there any ethical problems raised by
these casinos’ use of customer data? Explain
your response.
12.50
© 2005 by Prentice Hal
