Group 3
Rendi Haryadi D (1401164185)
Ika Nur A. (1401164200)
Alifia Ratna D. (1401164192)
Alvin (not working)
Noer setiawan (not working)

  1. What are the different types of decisions and how
    does the decision-making process work?

• List and describe the different levels of
decision making and decision-making
constituencies in organizations. Explain how
their decision-making requirements differ.

The different levels in an organization (strategic, management, operational) have different decision-making requirements. Decisions can be structured, semistructured, or unstructured, with structured decisions clustering at the operational level of the organization and unstructured decisions at the strategic level. Decision making can be performed by individuals or groups and includes employees as well as operational, middle, and senior managers. There are four stages in decision making: intelligence, design, choice, and implementation. Systems to support decision making do not always produce better manager and employee decisions that improve firm performance because of problems with information quality, management filters, and organizational culture.

• Distinguish between an unstructured,
semistructured, and structured decision.

Unstructured decisions are those in which the decision maker must provide judgment, evaluation, and insight to solve the problem. Each of these decisions is novel, important, and nonroutine, and there is no well-understood or agreed-on procedure for making them.

Structured decisions, by contrast, are repetitive and routine, and they involve a definite procedure for handling them so that they do not have to be treated each time as if they were new. Many decisions have elements of both types of decisions.

semistructured, where only part of the problem has a clear-cut answer provided by an accepted procedure. In general, structured decisions are more prevalent at lower organizational levels, whereas unstruc- tured problems are more common at higher levels of the firm.

• List and describe the stages in decision

Senior management face many unstructured decision situations, such as establishing the firm’s 5- or 10-year goals or deciding new markets to enter.

Middle management faces more structured decision scenarios but their decisions may include unstructured components. A typical middle-level management decision might be “Why is the reported order fulfillment report showing a decline over the past six months at a distribution center in Minneapolis?” This middle manager will obtain a report from the firm’s enterprise system or distribution management system on order activity and operational efficiency at the Minneapolis distribution center. This is the structured part of the decision. But before arriving at an answer, this middle manager will have to interview employees and gather more unstructured infor- mation from external sources about local economic conditions or sales trends.

Operational management and rank-and-file employees tend to make more structured decisions. For example, a supervisor on an assembly line has to decide whether an hourly paid worker is entitled to overtime pay. If the employee worked more than eight hours on a particular day, the supervisor would routinely grant overtime pay for any time beyond eight hours that was clocked on that day.

  1. How do information systems support the activities of managers and management decision
    • Compare the descriptions of managerial
    behavior in the classical and behavioral models.

The classical model describes formal managerial functions but does not
address exactly what managers do when they plan, decide things, and control
the work of others. For this, we must turn to the work of contemporary
behavioral scientists who have studied managers in daily action.

• Identify the specific managerial roles that can
be supported by information systems.

Interpersonal Roles : Managers act
as leaders, attempting to motivate, counsel, and support subordinates. Managers
also act as liaisons between various organizational levels; within each of these
levels, they serve as liaisons among the members of the management team.
Managers provide time and favors, which they expect to be returned.
Informational Roles: managers act as the nerve
centers of their organizations, receiving the most concrete, up-to-date information and redistributing it to those who need to be aware of it. Managers are therefore information disseminators and spokespersons for their organizations.

Decisional Roles: Managers make decisions. In their decisional role, they
act as entrepreneurs by initiating new kinds of activities; they handle
disturbances arising in the organization; they allocate resources to staff
members who need them; and they negotiate conflicts and mediate between
conflicting groups.

  1. How do business intelligence and business
    analytics support decision making?
    • Define and describe business intelligence and
    business analytics.

“Business intelligence (BI)” is a term used by hardware and software
vendors and information technology consultants to describe the infrastructure
for warehousing, integrating, reporting, and analyzing data that comes from
the business environment, including big data. The foundation infrastructure
collects, stores, cleans, and makes relevant information available to managers.
Think databases, data warehouses, data marts, Hadoop, and analytic platforms,
which we described in Chapter 6. “Business analytics (BA)” is also a vendor-
defined term that focuses more on tools and techniques for analyzing and
understanding data. Think online analytical processing (OLAP), statistics,
models, and data mining.

• List and describe the elements of a business
intelligence environment.

There are six
elements in this business intelligence environment:
– Data from the business environment: Businesses must deal with both
structured and unstructured data from many different sources, including
big data. The data need to be integrated and organized so that they can be
analyzed and used by human decision makers.

  • Business intelligence infrastructure: The underlying foundation of
    business intelligence is a powerful database system that captures all the
    relevant data to operate the business. The data may be stored in transactional
    databases or combined and integrated into an enterprise-data warehouse or
    series of interrelated data marts.

  • Business analytics toolset: A set of software tools are used to analyze data
    and produce reports, respond to questions posed by managers, and track the
    progress of the business using key indicators of performance.

  • Managerial users and methods: Business intelligence hardware and
    software are only as intelligent as the human beings who use them. Managers
    impose order on the analysis of data using a variety of managerial methods
    that define strategic business goals and specify how progress will be
    measured. These include business performance management and balanced
    scorecard approaches focusing on key performance indicators and industry
    strategic analyses focusing on changes in the general business environment,
    with special attention to competitors. Without strong senior management
    oversight, business analytics can produce a great deal of information, reports,
    and online screens that focus on the wrong matters and divert attention
    from the real issues. You need to remember that, so far, only humans can ask
    intelligent questions.

  • Delivery platform—MIS, DSS, ESS: The results from business intelligence
    and analytics are delivered to managers and employees in a variety of ways,
    depending on what they need to know to perform their jobs. MIS, DSS, and
    ESS, which we introduced in Chapter 2, deliver information and knowledge
    to different people and levels in the firm—operational employees, middle
    managers, and senior executives. In the past, these systems could not share
    data and operated as independent systems. Today, one suite of hardware and
    software tools in the form of a business intelligence and analytics package
    is able to integrate all this information and bring it to managers’ desktop or
    mobile platforms.

  • User interface: Business people are no longer tied to their desks and
    desktops. They often learn quicker from a visual representation of data than
    from a dry report with columns and rows of information. Today’s business
    analytics software suites emphasize visual techniques such as dashboards and
    scorecards. They also are able to deliver reports on BlackBerrys, iPhones, and
    other mobile handhelds as well as on the firm’s Web portal. BA software is
    adding capabilities to post information on Twitter, Facebook, or internal social
    media to support decision making in an online group setting rather than in a
    face-to-face meeting.

• List and describe the analytic functionalities
provided by BI systems.

There are six analytic functional-
ities that BI systems deliver to achieve these ends:
– Production reports: These are predefined reports based on industry-
specific requirements.

  • Parameterized reports: Users enter several parameters as in a pivot table
    to filter data and isolate impacts of parameters. For instance, you might want
    to enter region and time of day to understand how sales of a product vary
    by region and time. If you were Starbucks, you might find that customers in
    the East buy most of their coffee in the morning, whereas in the Northwest
    customers buy coffee throughout the day. This finding might lead to different
    marketing and ad campaigns in each region.

  • Dashboards/scorecards: These are visual tools for presenting performance
    data defined by users.

  • Ad hoc query/search/report creation: These allow users to create their
    own reports based on queries and searches.

  • Drill down: This is the ability to move from a high-level summary to a more
    detailed view.

  • Forecasts, scenarios, models: These include the ability to perform linear
    forecasting, what-if scenario analysis, and analyze data using standard
    statistical tools.

• Compare two different management strategies
for developing BI and BA capabilities.

There are two different strategies for adopting BI and BA capabilities for the
organization: one-stop integrated solutions versus multiple best-of-breed
vendor solutions.

The first solution carries the risk that a single vendor provides your firm’s
total hardware and software solution, making your firm dependent on its
pricing power. It also offers the advantage of dealing with a single vendor who
can deliver on a global scale.

The second solution offers greater flexibility and
independence, but with the risk of potential difficulties integrating the software
to the hardware platform, as well as to other software. Vendors always claim
their software is “compatible” with other software, but the reality is that it can
be very difficult to integrate software from different vendors. Microsoft in
particular emphasizes building on its desktop interface and operating system
(Windows), which are familiar to many users, and developing server applica-
tions that run on Microsoft local area networks. But data from hardware and
software produced by different vendors will have to flow seamlessly into
Microsoft workstations to make this strategy work. This may not be adequate
for Fortune 500 firms needing a global networking solution.

  1. How do different decision-making constituencies
    in an organization use business intelligence?

• List each of the major decision-making
constituencies in an organization and describe
the types of decisions each makes.

There are 3 levels of constituencies in organization, which are lower supervisory (operational) management, middle management, and senior management (vice president and above). Each of these management groups has different responsibilities and different needs for information and business intelligence, with decisions becoming less structured among higher levels of management. Operational and middle management charged on support for semistructured decisions. Meanwhile for senior management, they are in charged of balanced scorecard and enterprise performance management methods. The results from business intelligence and analytics are delivered to managers and employees in a variety of ways, depending on what they know to perform their jobs. MIS,DSS an ESS which deliver information and knowledge to different people and level in a firms. Management information systems (MIS) producing routine production reports are typically used to support this type of decision making. For making unstructured decisions, middle managers and analysts will use decision-support systems (DSS) with powerful analytics and modeling tools, including spreadsheets and pivot tables. Senior executives making unstructured decisions use dashboards and visual interfaces displaying key performance information affecting the overall profitability, success, and strategy of the firm. The balanced scorecard and business performance management are two methodologies used in designing executive support systems (ESS). The leading methodology for understanding the really important information needed by a firm’s executive.

• Describe how MIS, DSS, or ESS provide
decision support for each of these groups.

Management information system (MIS)
-Serve middle management
-These system are generally not flexible and have little analytical capability
-Provide answer to routine questions
-Provide reports on firm’s current performance based on data from TPS (data from internal)

Decision support system (DSS)
-Serve middle management
-support non-routine decision making (problems that are unique and rapidly changing)
-use information from TPS and MIS , and also data from external

Executive support system (ESS)
-Support senior management
-Address non-routine decisions requiring judgement or evaluation
-Incorporate data about external events and summarized information from internal MIS and DSS

• Define and describe the balanced scorecard
method and business performance

The balanced scorecard is a strategic planning and management system which takes into account non-financial aspects of corporate performance, such as customer satisfaction and business processes, to create a complete picture of how the company is likely to perform in the future. For example, reducing the level of customer service may boost current earnings, but the balanced scorecard approach would also take into account potential loss of future earnings due to poor customer satisfaction.

  1. What is the role of information systems in
    helping people working in a group make
    decisions more efficiently?

• Define a group decision-support system
(GDSS) and explain how it differs from a DSS.

Group decision-support systems (GDSS) help people working together in a group arrive at decisions more
efficiently. GDSS feature special conference room facilities where participants contribute their ideas using
networked computers and software tools for organizing ideas, gathering information, making and setting
priorities, and documenting meeting sessions.

• Explain how a GDSS works and how it provides
value for a business.

GDSS lead to more participative and democratic decision making. The process is anonymous, which leads to impartial judgement and evaluation. The focus is primarily on communication between the participants. GDSS enhances group decision making by saving time and increasing efficiency without the need to decrease the number of participants. Some of the factors involved in a successful outcome of a group meeting are: the variety of people attending, the facilitator’s effectiveness, the organization’s environment, the quality of the meeting’s organization, the cooperation of the attendees and the appropriateness of the selected tools.

There are a couple of characteristics of GDSS that add business value to a decision making process. First, by implementing GDSS, more people can attend a meeting without causing the productivity to suffer. Thus, everybody contributes simultaneously and the meeting becomes much more efficient. Second, GDSS guarantees anonymous to the contributors, which helps them express their propositions more freely without worrying of being criticized, underestimated or having their ideas rejected because of personal preferences. Third, a properly designed GDSS can increase the number of ideas generated in a meeting and the quality of the decisions while producing the desired results in fewer meetings in both face-to-face and distributed meeting environment.

Discussion result:
After 15 days expired we must create new account again