Chapter 10 Executive Compensation. Chapter 10 Executive Compensation.
chapter 10
description
Transcript of chapter 10
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
1
CHAPTER 10DATA, KNOWLEDGE,
AND DECISION SUPPORT
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
2
Learning Objectives Describe the concepts of managerial decision making and computerized
support decision making Understand the life cycle of processing data into information and
knowledge for use in decision support Describe the framework for computerized decision support and the concept
of decision support systems Describe executive information systems and group support systems, and
analyze their roles in management support Describe data presentation methods and explain geographical information
systems as a decision support tool Explain the concepts of knowledge management and organizational
databases Describe knowledge discovery, online analytical processing, and data
mining
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
3
Chapter OverviewManagement and Decision Making• The Manager’s Job • Why Managers Need IT Support
Data Management Life Cycle• The Data Life Cycle Process • Data Sources and Collection • Data Quality• Data Storage and Management • Document Management• Analytical Processing
Decision Support Systems
• The Decision Support Process• Modeling• A Framework for Computerized DSS• DSS Concepts, Characteristics, and Capabilities• Components and Structure of DSS
Enterprise Decision Support
•Executive Information Support•Supporting Idea Generation and Creativity•Group Decision Support Systems (GDSS)
Data Visualisation Technologies
•Data Visualization•Visual Interactive Decision Making•Geographical Information Systems
Knowledge Management and Organization Knowledge Bases•What is knowledge Management?•IT Support of Knowledge Management Activities•Implementing Knowledge Management
Knowledge Discovery and Analysis
•The Foundations of Knowledge Discovery•Online Analytical Processing•Data Mining for Decision Support•Ethical and Legal Issues
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
4
Case: Managing Global Business at 3M Corporation
The Business Problem
The Solution The Company created a global enterprise data warehouse
(GEDW)
The company had difficulties responding to new customers and markets in the globaleconomy as each business unit kept separate databases and conducted independent decision support activities
The Results Distributors and retailers, as well as end-users, now receive information in minutes instead of
weeks or months, including the delivery of rich multimedia Customers can find all their information in one place Inventories are lower, and better and quicker inventory decisions are made, even in globally
remote locations
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
5
What have we learned from this case??
Case (continued…)
The case shows the need to share a company’s data internally and with business partners and customers, and to make it available in a format that enables end users to process data quickly
The case explains the data warehouse, and its role in supporting managerial decision making
The case demonstrates the existence of vast amounts of important data in organizations, and the importance of organizing that data for optimum use
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
6
Management andDecision Making
Management a process by which certain goals are achieved through
the use of resources
Managers - make decisions in every step of the process interpersonal roles : figurehead, leader, liaison informational roles : monitor, disseminator,
spokesperson decisional roles : entrepreneur, disturbance handler,
resource allocator, negotiator
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
7
Management andDecision Making (continued …)
Why Managers Need IT Support processing information manually is growing
increasingly difficult computerized modeling
examining numerous alternatives very quickly providing a systematic risk analysis being integrated with communication systems
and databases being used to support group work
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
8
The Data ManagementLife Cycle Process
Data Sources (databases)
End Users:Decision Making and other Tasks;
Data Visualization
Data Warehouse(storage)
Analytical Processing,Data Mining
Generate Knowledge
Organizational Knowledge Bases
Purchased Knowledge Storage
Direct Use
Data Organization; Storage
Direct Use
Use
Use
Use
Use of Knowledge
Storage
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
9
Data Sources and Collection Internal Data - generated by the corporate transaction
processing systems, functional user information systems, and other functions and individuals
Personal Data - created for IS users or other corporate employees documenting their own expertise
External Data - generated outside and organization, but relevant portions of it flow into the organization
Methods for Collecting Raw Data manually or by instruments and sensors scanned or transferred electronically in the field; other times from within the organization or
from people
The Data ManagementLife Cycle (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
10
Data Quality an extremely important issue since
quality determines the data’s usefulness as well as the quality of the decisions based on these data
need to be : accurate, secure, relevant, timely, complete, and consistent
The Data ManagementLife Cycle (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
11
Data Storage databases or in data warehouse and data marts
Data Management difficulties in data management
exponential increases of data with time data collected by several methods and devices various sources of raw data only small portions are relevant an ever-increasing amount of external data different legal requirements relating to data selecting data management tools - a problem data security, quality, and integrity
The Data ManagementLife Cycle (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
12
Document Management Document Management System (DMS)
automates the control of electronic documents through their entire life cycle within an organization, from initial creating to final archiving
retains an image of an electronic document creates an index of key-words puts the entire document into computer readable format manages (and limits) distribution
Functions document identification, storage, and retrieval; tracking
version control’ workflow management’ and presentation
The Data ManagementLife Cycle (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
13
Analytical Processing - the activity of analyzing accumulated data work directly with the existing
operational systems, using software tools and components known as front-end tools
work with the data warehouse
The Data ManagementLife Cycle (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
14
The Decision Support Process
Decision Support Systems (DSS)
Intelligence PhaseIntelligence Phase
Design PhaseDesign Phase
Choice PhasesChoice Phases
REALITY
Implementationof Solution
Implementationof Solution
SUCCESS
FAILURE
Verification, Testing of Proposed Solution
Verification of the Model
Examination
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
15
Modeling in DSS Iconic (scale) models
a physical replica of a system, usually based on a different scale form original
Analog models a physical model, but the shape of the model
differs from that of the actual system Mathematical (qualitative) model
models complex relationships and conducts experimentations with them
Mental models provide a description of how a person thinks
about a situation
DSS (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
16
A Framework for Computerized Decision Support Problem Complexity
decision making processes fall along a continuum that ranges from highly structured to highly unstructured decisions
Nature of Decisions strategic planning - the long-range goals and policies for
resource allocation management control - the acquisition and efficient
utilization of resources in the accomplishment of organizational goals
operational control - the efficient and effective execution of specific tasks
DSS (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
17
Decision Support Framework
DSS (continued …)
Type of Control
Type of Decision
Operational Control
Managerial Control
StrategicPlanning
SupportNeeded
Structured
Semi-structured
Unstructured
Accounts Receivable Order entry
Production scheduling inventory control
Selecting a cover for a magazine, buying software approving loans
Support Needed
Budget analysis,short-term forecasting, personnel reports, make-of-buy analysis
Credit evaluation, Budget Preparation, plan layout, project scheduling, rewarded systems design
Negotiating,recruiting and executive,buying hardware,lobbying
Financialmanagement ,warehouse location, distribution systems
Building new plant, mergers and acquisitions, new product planning, compensation planning, quality assurance planningR & D planning, new technology development social responsibility planning
MISMS modelsF & S models
DSS
DSSES Neural Networks
MIS,MS
MS, DSS, EIS, ES EIS, ES, Neural Networks
1 2 3
4 5 6
7 8 9
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
18
Computer Support for Structured decision support the nine cells, especially to the operational and
managerial control type lower-level managers encounter on a regular basis
typically have a high level of structure Management Science - adopts the view that managers
can follow a fairly systematic process for solving problems Define the problem Classify the problem into a standard category Construct a standard mathematical model Find potential solutions Choose and recommend a specific solution
DSS (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
19
Concepts an approach or a philosophy rather than a precise methodology
Characteristics and Capabilities support decision makers at all managerial levels support several interdependent and/or sequential decisions support all phases of decision making and variety of decision-
making processes and styles can be adopted over time to deal with changing conditions easy to construct utilize models integrate systems execute sensitivity analysis
DSS (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
20
Sensitivity Analysis the study of the effect that changes in one
or more parts of a model have on other parts of the model
What-if Analysis checks the impact of a change in the
assumptions or other input data on the proposed solution
Goal-seeking Analysis find the value of the inputs necessary to
achieve a desired level of output
DSS (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
21
Components and Structure of DSS Data Management
includes the database(s), which contains relevant data for the decision situation
User Interface enables the users to communicate with and
command the DSS Model Management
includes software with financial, statistical, management science, or other quantitative models
Knowledge Management supports any of the other subsystems or act as an
independent component
DSS (continued …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
22
Enterprise Decision Support Executive Information Support
Capabilities of EIS Drill down Critical success factors and key performance indicators Status access Trend analysis Ad hoc analysis Exception reporting Intelligent EIS Integration with DSS
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
23
Enterprise Decision Support (continues …)
DSS, EIS, and the Internet
The DSS/EIS builder can access Web pages and view data that are related to the DSS project; thus saving time
The Web supports interactive DSS-related queries and ad hoc report generation.
Users have the capabilities of advanced DSS application without requiring special software
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
24
Supporting Idea Generation and Creativity Generate ideas or be creative in order to generate
alternative solutions for semi structured and unstructured situations
Idea-generation software stimulates a single user or a group to produce
new ideas, options, and choices encourages and pushes, something like a
personal trainer increases the flow of ideas to the user
Enterprise Decision Support (continues …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
25
Group Decision Support Systems (GDSS) an interactive computer-based system that facilitates the
solution of semi structured and unstructured problems by a group of decision makers
supports face-to-face meetings - decision room as well as meetings where members are in different
locations to improve the productivity of decision making meetings,
either by speeding up the decision-making process or by improving the quality of the resulting decisions, or both
Enterprise Decision Support (continues …)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
26
Data Visualization Technologies Data Visualization
presents data by technologies such as digital images, geographical information systems, graphical user interfaces, multidimensional tables, and graphs, virtual reality, three-dimensional presentations, and animation
allows people to spot problems that have existed for years, undetected by standard analysis methods
can be integrated among themselves to create a variety of presentations
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
27
Data Visualization Technologies (continued …)
Visual Interactive Decision Making Visual interactive modeling (VIM)
use computer graphic displays to represent the impact of different management or operational decisions on goals such as profit or market share
user can intervene in the decision-making process and see the results of the intervention
Visual interactive simulation (VIS) the end-user watches the progress of the simulation model in an
animated form using graphics terminals users may interact with the simulation and try different decision
strategies
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
28
Geographical Information System (GIS)
GIS Categories
GIS
Spatial Imaging Function
Design and Planning Function
Database Management
Function
Decision Modelling Function
Surveying and MappingDesign and Engineering
Facilities Management
Strategic Planning and
Decision Making
Demographic and Market
AnalysisTransportation and Logistics
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
29
GIS (continued …) GIS Applications and Decision Making
Company What the Application DoesHelps select new Taco Bell and Pizza Hut restaurants, by combining demographic data and traffic patterns
PepsiCo, Inc.
Answers such questions as “How many CIGNA-affiliated physicians are within an 8-mile radius of a business?”
CIGNA (health insurance)
Creates a detailed demographic profile of store’s neighborhood to determine the store’s best product mix
Western Auto (a subsidiary of Sears)
Supports planning of truck routesSears, Roebuck & Co.Tracks cancer rate to determine clinics’ expansion strategy and allocation of expensive equipment
Health maintenance organizations
Maps neighborhoods where temporary workers live; used for locating marketing and recruiting efforts in cities
Wood Personnel Services (employment agency)
Designs optimal sales territories and routes for their clients, reducing travel costs by 15 percent
Wilkening & Co.(consulting services)
Maps its entire cellular network to identify clusters of call disconnects and to dispatch technician accordingly
CellularOne Corp.
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
30
GIS (continued …)
Emerging GIS Applications help reengineer the aviation, transportation, and
shipping industries enables vehicles or aircraft equipped with a
GPS receiver to pinpoint their location as they move
include railroad car tracking and earth-moving equipment tracking
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
31
Knowledge Management and Organizational Knowledge Bases
What is Knowledge Management? Knowledge assets - regarding markets, products,
technologies, and organizations that a business owns or needs to own
Best practices - collection of the most successful solutions and/or case studies
Intellectual capital - collection of knowledge amassed by an organization over the years
Knowledge system - collects knowledge, stores it in a database, maintains the database, and disseminates the knowledge to users
competitive intelligence - collection of competitive information
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
32
IT Support of Knowledge Management Activities
Knowledge identification - determines what knowledge (information) is critical to decision making
Knowledge discovery and analysis - using search engines, databases, and data mining, the proper knowledge must be found, analyzed, and put into proper context
Establishment of organizational knowledge bases - it stores organizational knowledge and best practices
Knowledge distribution and use - target audiences are defined and technologies are put into place to enable knowledge delivery when needed
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
33
Implementing Knowledge Management
Reorganize as knowledge-based organizations Created a new position, chief knowledge
officer (CKO) crating knowledge management infrastructure build a knowledge culture make it pay off
Facilitate organizational learning learn from their experiences in order to survive
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
34
The Foundations of Knowledge Discovery
identify valid, novel, potentially useful data, and understand patterns in data
supported by : massive data collection, powerful multiprocessor computers, and data mining algorithms
tools : data warehousing and data access, multidimensionality, data mining, massive databases, and online analytical processing
Knowledge Discovery and Analysis
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
35
Analysis by end users from their desktop, online Analyze the relationships between many types of business
elements Involve aggregated data Compare aggregated data over hierarchical time period present data in different perspectives Involve complex calculations between data elements Respond quickly to users requests
Online Analytical Processing (OLAP)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
36
Data Mining searches for valuable business information in a large database and “mines a mountain for a vein of valuable ore”
Two capabilities automated prediction of trends and
behaviors automated discovery of previously
unknown patterns and relationships
Data Mining for Decision Support
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
37
Data Mining Tools Neural computing
learning approach by which historical data can be examined for patterns by a computer
Intelligent agents retrieving information from the Internet or from
intranet-based databases Association analysis
using a specialized set of algorithms that sort through large data sets and expresses statistical rules among items
Data Mining (continues ...)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
38
Ethical Issues prohibited valuable data-mined information accountability for incorrect decisions human judgment
Legal Issues discrimination of age or gender for promotions data security from external snooping or sabotage data ownership
Data Mining (continues ...)
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
39
For Accounting play major role in the justification of the creation
of a knowledge base and in its auditing For Finance
responsible for justifying major investments can be helped by most DSS applications in
financial management and analysis For Marketing
use the organization’s knowledge base and will participate in its creation
What’s in IT for Me?
Introduction to Information TechnologyTurban, Rainer and Potter
Chapter 10 Data, Knowledge, and Decision Support
40
What’s in IT for Me? (continued …)
For Production/Operations Management can get help in scheduling, logistics,
maintenance
For Human Resources Management use the knowledge base to find out how past
cases were handled resolve the issue of compensating employees
for contributing their knowledge