CHAPTER 9 : ENABLING THE ORGANIZATION - DECISION MAKING

CHAPTER 9 : ENABLING THE ORGANIZATION - DECISION MAKING

Decision making

• Reason for the growth of decision - making information systems
• people need to analyze large amounts of information
• people must make decisions quickly
• people must apply sophisticated analysis techniques, such as modeling and forecasting, to make good decisions
• people must protect the corporate asset of organizational information

• Model - a simplified representation or abstraction of reality
• IT system is an enterprise

Transaction Processing Systems

• Moving up through the organizational pyramid users move from requiring transaction information to analytically information
• Transaction processing system - the basic business system that serves the operational level (analysts) in an organization
• Online transaction processing (OLTP) the capturing of transaction and event information using technology to (1) process the information according to defined business rules, (2) store the information, (3) update existing information to reflect the new information. more to save the information
• Online analytically processing (OLAP) - the manipulation of information to create business intelligence in support of strategic decision making. do the information for decision making. more to analysis

Decision support systems

• Decision support system (DSS) - models information to support managers and business professionals during the decision-making process
• Three quantitative models used by DSSs include:
• sensitivity analysis
• what-if analysis
• goal-seeking analysis

Executive Information Systems

• a specialized DSS that supports senior level executives within the organization
• most EISs offering the following capabilities :
• consolidation
• drill-down
• slice-and-dice
• Digital dashboard - integrates information from multiple components and present it in a unified display

Artificial Intelligence (AI)

• Intelligent system - various commercial applications of artificial intelligence
• Artificial intelligence (AI) - simulates human intelligence such as the ability to reason and learn
• advantages - can check info on competitor
• Four most common categories of Al include:
• expert system
• neural network
• genetic algorithm
• intelligent agent

Data Mining

• data-mining software includes many forms of AI such neural network and expert systems
• common forms of data-mining analysis capabilities include:
• cluster analysis
• association detection
• statistical analysis