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Chapter 2 • Foundations and Technologies for Decision Making 103

report status, and, when a problem is discovered, • The major components of a DSS are a database
their analysis tools are utilized by decision makers. and its management, a model base and its man-
• DSS can provide support in all phases of the deci- agement, and a user-friendly interface. An intelli-
sion-making process and to all managerial levels gent (knowledge-based) component can also be
for individuals, groups, and organizations. included. The user is also considered to be a com-
• DSS is a user-oriented tool. Many applica- ponent of a DSS.
tions can be developed by end users, often in • Data warehouses, data mining, and OLAP have
spreadsheets. made it possible to develop DSS quickly and easily.
• DSS can improve the effectiveness of decision • The data management subsystem usually includes
making, decrease the need for training, improve a DSS database, a DBMS, a data directory, and a
management control, facilitate communication, query facility.
save effort by the users, reduce costs, and allow • The model base includes standard models and
for more objective decision making. models specifically written for the DSS.
• The AIS SIGDSS classification of DSS includes • Custom-made models can be written in program-
communications-driven and group DSS (GSS), ming languages, in special modeling languages,
data-driven DSS, document-driven DSS, knowl- and in Web-based development systems (e.g., Java,
edge-driven DSS, data mining and management the .NET Framework).
ES applications, and model-driven DSS. Several • The user interface (or dialog) is of utmost impor-
other classifications map into this one. tance. It is managed by software that provides the
• Several useful classifications of DSS are based needed capabilities. Web browsers and smart-
on why they are developed (institutional versus phones/tablets commonly provide a friendly, con-
ad hoc), what level within the organization they sistent DSS GUI.
support (personal, group, or organizational), • The user interface capabilities of DSS have moved
whether they support individual work or group into small, portable devices, including smart-
work (individual DSS versus GSS), and how they phones, tablets, and so forth.
are developed (custom versus ready-made).

Key terms

ad hoc DSS decision making institutional DSS problem ownership
algorithm decision style intelligence phase problem solving
analytical techniques decision variable model base management satisficing
business intelligence descriptive model system (MBMS) scenario
(BI) design phase normative model sensitivity analysis
choice phase DSS application optimization simulation
data warehouse effectiveness organizational suboptimization
database management efficiency knowledge base user interface
system (DBMS) implementation phase principle of choice what-if analysis

Questions for Discussion

1. Discuss the need to have decision support systems between 5. Apply Simon’s four-phase model to the elevator application
behavioral and scientific methods. case (see Application Case 2.1).
2. Discuss the complexity in including behavioral patterns 6. Examine why the decomposition of a problem is one of
into computerized systems. the most important steps in decision making.
3. Explain why decision makers using the same decision- 7. Appraise the maxim: “All models are wrong, some are
making process might end up with two different decisions. useful.”
4. Present similarities and differences between Simon’s and 8. Develop an example illustrating satisficing and explain
Kepner-Tregoe methods. why this method is suboptimal yet very useful.

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