Chapter 7

Decision Support Systems:

All about making decisions

Decision Support System

                 An interactive computer-based system or sub-system intended to help decision makers use communications technologies, data, documents, knowledge and models.

Reasons why decision making today is becoming more complicated:

  • Technology/Information/Computers: Increasing → More alternatives to choose
  • Structural Complexity/Competition: Increasing → Larger cost of error
  • International Markets/Consumerism: Increasing → More uncertainty about the future
  • Changes/Fluctuations: Increasing → Need for quick decisions

Most management problems for which decisions are sought can be represented by 3 standard elements namely:


  • Maximize profit
  • Provide earliest entry into market
  • Minimize employee discomfort/turnover

Decision Variables

  • Determine what price to use
  • Determine length of time tests which should run on a new product/service
  • Determine the responsibilities to assign each worker


  • Cannot charge below cost
  • Test enough to meet minimum safety regulations

Business problems that require decision-making are classified as:


situations where the procedures to follow when a decision is needed can be specified in advance.


decision situations


decision procedures that can be pre-specified, but not to lead to a definite recommended decision

Taxonomies of Decision Support System

Model-Driven DSS

Data-Driven DSS

Communication-Driven DSS

Knowledge-Driven DSS

Decision Support in Business

Artificial Intelligence Technologies in Business

What is artificial intelligence?

     Artificial intelligence is the simulation of human intelligence processes by machines, especially computer systems. These processes include learning (the acquisition of information and rules for using the information), reasoning (using the rules to reach approximate or definite conclusions), and self-correction. Particular applications of AI include expert systems, speech recognition, and machine vision.

What is expert system?

     An expert system is a computer program that uses artificial intelligence (AI) technologies to simulate the judgment and behavior of a human or an organization that has expert knowledge and experience in a particular field.

Such systems use databases of expert knowledge to offer advice or make decisions in such areas as medical diagnosis and trading on the stock exchange.

     Expert systems have played a large role in many industries including in financial services, telecommunications, healthcare, customer service, transportation, video games, manufacturing, aviation and written communication. Two early expert systems broke ground in the healthcare space for medical diagnoses: Dendral, which helped chemists identify organic molecules, and MYCIN, which helped to identify bacteria such as bacteremia and meningitis, and to recommend antibiotics and dosages.

What is speech recognition?

     Speech recognition is the ability of a machine or program to identify words and phrases in spoken language and convert them to a machine-readable format. Rudimentary speech recognition software has a limited vocabulary of words and phrases and may only identify these if they are spoken very clearly. More sophisticated software has the ability to accept natural speech. Speech recognition applications include call routing, speech-to-text, voice dialing and voice search.

     The terms "speech recognition" and "voice recognition"Speech recognition is used to identify words in spoken language. Voice recognition is a biometric technology used to identify a particular individual's voice.

What is machine vision?

     Machine vision is the ability of a computer to "see." A machine-vision system employs one or more video cameras, analog-to-digital conversion (ADC), and digital signal processing (DSP). The resulting data goes to a computer or robot controller. Machine vision is similar in complexity to voice recognition.

Machine vision is used in various industrial and medical applications. Examples include:

• Electronic component analysis

• Signature identification

• Optical character recognition

• Handwriting recognition

• Object recognition

• Pattern recognition

• Materials inspection

• Currency inspection

• Medical image analysis

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by raineraine685


Public - 7/31/16, 9:41 AM