Summary. Key Terms. Review Questions. Exercises. References. Fort Lowell Trading Company. UNStexercises. TYPES OF DECISION SUPPORT . i^SYSTEMS.
DECISION SUPPORT AND DATA WAREHOUSE SYSTEMS
'7
Effrem G. Mallach University of Massachusetts at Lowell
5)
=3
OtfTOF fft|AHAiW>UW>A310N ^tlKAl^'
iitfc GiA HA NOI TfiuKlG TAM
T H 6 N G TIN THU VigN
Af)o/^0/'^ Irwin McGraw-Hill B o s t o n B..n..e.. ^^;t,^^iZJ:':X.^:Sr'' " " ^ Me.coCrr: r o l l = ^ n W e Sydney Taipei Toronto
CONTENTS
PART
Introduction to Decision Support Systems 1 INTRODUCTION TO DECISION SUPPORT SYSTEMS
1.1 How Decision Support Systems Evolved 1.2 WhatlsaDSS? 1.3 Why Decision Support Systems Matter 1.4 DSS Benefits 1.5 Why Study DSS? 1.6 The Plan of This Book Summary Key Terms Review Questions Exercises References Fort Lowell Trading Company
4 10 13 17 23 23 27 27 28 28 30 31
2 HUMAN DECISION-MAKING PROCESSES
36
2.1 What Is a Decision?
37
2.2 The Decision Process 2.2.7 The Intelligence Phase 2.2.2 The Design Phase 2.2.3 The Choice Phase
39 39 40 40
2.3 Types of Decisions
42
2.4 How Businesspeople Make Decisions 2.4.1 The Rational Manager 2.4.2 Subjective Utility 2.4.3 Systematic Decision Making 2.4.4 Satisficing 2.4.5 Organizational and Political Decision Making 2.5 The Impact of Psychological Type on Decision Making 2.6 The Impact of Culture on Decision Making 2.7 The Kepner-Tregoe DecisionMaking Method 2.7.1 State the Purpose of the Decision
47 48 51 54 57 57 59 64 65 66 •i ^ ^
Xiii
XIV
CONTENTS
67 2.7.2 Establish Objectives 2.7.3 Classify According 67 to Importance 68 2.7.4 Generate Alternatives 2.7.5 Evaluate Alternatives Against 69 Objectives 2.7.6 Tentatively, Choose the Best 70 Alternative 2.7.7 Assess Adverse Consequences 70 71 2.7.8 Make a Final Choice
4.1.1 Overview of the DSS Hierarchy130 4.1.2 The Seven DSS Types 131 4.1.3 Applying the DSS Types to Airline Yield Management 134 4.2 Generalizing the DSS Categories 143
Summary
73
Key Terms
73
Review Questions
74
Exercises
75
References Fort Lowell Trading Company
77
Exercises
82
3 SYSTEMS, INFORMATION QUALITY, AND MODELS
83
3.1 About Systems
84
3.2 Information Systems
88
3.3 Data Flow Diagrams
90
3.4 DSS as Information Systems
92
3.5 Information and Information Quality 3.5.1 Information Versus Data 3.5.2 Information Quality 3.5.3 Information Quality Factors 3.6 Models
94 94 97 98 120
Key Terms
122
Review Questions
123
Exercises
123
References
126 127
UNStexercises TYPES OF DECISION SUPPORT i^SYSTEMS 4.1 The DSS Hierarchy
143
4.4 Individual and Group DSS
144
4.5 Matching Benefits to the DSS User Community
145
4.6 Matching DSS to the Decision Maker's Psychological Type 4.6.1 Introversion/Extraversion 4.6.2 Sensing/Intuition 4.6.3 Thinking/Feeling 4.6.4 Judgment/Perception 4.6.5 Combinations of Preferences
146 147 147 148 148 148
4.7 Usage Modes
149
4.8 Institutional Versus Ad Hoc DSS
151
Summary
152
Key Terms
153
Review Questions
154
Exercises
154
References
156
Fort Lowell Trading Company
156
Exercises
159
PART
119
Summary
Fort Lowell Trading Company
.
79
4.3 Matching DSS to the Decision Type
128 129 130
Building and Implementing Decision Support Systems 5 DSS ARCHITECTURE. HARDWARE. AND OPERATING SYSTEM PLATFORMS 5.1 Defining the DSS Architecture 5.2 The Major Options 5.3 DSS on the Central Corporate System 5.4 DSS and Client/Server Computing
163 164 168 169 171
CONTENTS
5.5 The internet and Client/Server Computing in DSS 5.6 DSS Using Shared Data on a Separate System 5.7 DSS on a Stand-Alone System 5.8 Open Systems and DSS 5.9 Choosing a DSS Hardware Environment Summary W V
Exercisp^ 177 179 182 184 189 190 .*. ^ v^
f
References rort Lowell Trading Company Exercises 7 BUILDING AND IMPLEMENTING DECISION SUPPORT SYSTEMS
XV 252 254 255 256 258
7.1 The DSS Development Process 7.1.1 The SDLC Approach 7.1.2 Prototyping 7.1.3 End-User Development
6.4 Programming Languages for DSS 6.4.1 Third-Generation Programming Languages 6.4.2 Fourth-Generation Programming Languages
228
230
Fort Lowell Trading Company
294 295
6.5 DSS User Interfaces 6.5.1 Factors to Consider in User Interface Design 6.5.2 User Interface Styles 6.5.3 Hypertext/Hypermedia
235
Exercises
296
Summary Key Terms Rev iew Questions
229
236 240 245 948 250 252
8 MODELS IN DECISION SUPPORT SYSTEMS 8.1 Types of Models 8.1.1 Model Types 8.1.2 Model Types Used in DSS 8.1.3 Simplification in Models
297 298 299 300 307
KVI
CONTENTS 8.2 Discrete-Event Simulation Models 8.2.1 The Concept of Discrete-Event Simulation 8.2.2 A Discrete-Event Simulation Example 8.2.3 Designing a Discrete-Event Simulation Model 8.2.4 Another Simulation Example 8.2.5 Complete Simulation Studies
9.4.4 Linear Programming (LP) 9.4.5 Numerical Methods
309 309
Summary Key Terms
311
Review Questions 315 320 323
Exercises
8.3 Random Numbers, Pseudo-random Numbers, and Statistical 325 Distributions 329 8.4 Static Simulation Models
Exercises
Summary Key Terms Review Questions Exercises
References Fort Lowell Trading Company 10 GROUP DECISION SUPPORT SYSTEMS
10.1 What Are Group DSS?
334 335 336 336
References Fort Lowell Trading Company Exercises
341 342 344
I MATHEMATICAL MODELS 346 AND OPTIMIZATION 347 9.1 Queuing Models 348 9 / 1 Queuing Theory Concepts 348 912 A Queuing Theory Example 351 9 1 3 Generalizing the Solution 9 J J Arrival and Departure Time 352 Distributions 9.1.5 Queuing Theory 354 on a Computer 355 Q 2 Markov Process Models ^ 92.lTheMarkovProcessModel 355 Concept 9 2 2 Computer Calculations 357 for Markov Processes
9.3 Simulation, Q « J S a r e d and Markov Processes ^
\r^
9 4 Optimization 9A. I Complete Enumeration Q42 Random Search I4.3 The Calculus Approach
357
358 358 360 361
363 368 372 374 375 375 378 379 383 384 385
386 10.2 Why Group DSS Now? 10.2.1 Organizational Reasons 386 for GDSS Growth 10.2.2 Technical Reasons 387 for Group DSS Growth 10.2.3 Putting the Factors Together 388 10 3 Group Versus Individual Activities 388 10.4 Media Richness and Task Types 10.4.1 Richness 10.4.2 Task 10.4.3 Task and Media Fit 10.5 Types of Group DSS
390 390 391 392
393 396 10.6 Groupware 399 10 7 Group DSS in Use Today 399 10 71 Electronic Meeting Systems403 10 72 Work Flow Systems 406 406 DOLPHIN and MERMAID 408 WH2 Lotus Notes 412 \ l ^ InConcertWor^'^'o^ 414 415 Summary 416 Key Terms Review Questions 417 419 420 Exercises 423
Exercises
CONTENTS
11 EXPERT SYSTEMS
11.1 11.2 11.3 11.4
Artificial Intelligence Expert Systems: The Basic Idea Confidence Factors Fuzzy Logic
XVii
424
Fort Lowell Trading Company
489
425
Exercises
490
427 430 432
11.5 Expert System Development Tools U.5.1 Shells 11.5.2 Languages 11.6 Choosing a Good Expert System Application
434 434 440
11.7 Finding the Expert(s)
447
11.8 Expert Systems and DSS
449
11.9 Pros and Cons of Expert Systems
451
Summary
453
Key Terms
454
Review Questions
455
Exercises
455
References
457
Fort Lowell Trading Company
458
Exercises
459
442
P A R T II
13 THE DATA WAREHOUSE DATABASE
491
13.1 Content of the Data Warehouse Database
492
13.2 Database Structures
494
13.2.1 Organizing a Relational Data Warehouse 13.2.2 Multidimensional Database Structures 13.2.3 Choosing a Structure
13.3 Getting Data Into the Data Warehouse 13.3.1 13.3.2 13.3.3 13.3.4 13.3.5
13.4 Metadata 13.4.1 Human Metadata 13.4.2 Computer-based Metadata for People to Use 13.4.3 Computer-based Metadata for the Computer to Use
495 498 501
503 503 504 507 510 511
514 514 516 516
Summary
518
Data Warehousing
Key Terms Review Questions
519
12 DATA WAREHOUSING AND EXECUTIVE INFORMATION SYSTEM FUNDAMENTALS
Exercises References Fort Lowell Trading Company
520 521
Exercises
523
) ^ '
465
12.1 What Is a Data Warehouse?
466
12.2 Who Uses Data Warehouses?
470
12.3 Why Data Warehouses Now? 12.4 Data Warehouse Concepts 12.5 Executive Information Systems
471
Summary Key Terms Review Questions Exercises
484
References
488
472 476 485 486 486
14 ANALYZING THE CONTENTS OF THE DATA WAREHOUSE
14.1 Active Analysis: User Queries 14.1.1 14.1.2 14.1.3 14.1.4
OLAP Example OLAP Software Architecture Web-based OLAP General OLAP Product Characteristics
520
522
524 525 531 532 537 537
14.2 Automated Analysis: Data Mining 542 14.2.1 Creating a Decision Tree
545
XVIII
CONTENTS
14.2.2 Correlation and Other Statistical Analyses 54 7 14.2.3 Neural Networks 548 14.2.4 Nearest Neighbor Approaches 551 14.2.5 Putting the Results to Use 552
P A R T IV
Summary
Summary
553
Key Terms
554
16 PULLING IT ALL TOGETHER: SYSTEMS INTEGRATION AND THE FUTURE OF DSS
Review Questions
554
16.1 Combining the Pieces
598
Exercises
555
16.2 What Is Systems Integration?
601
References
556
16.3 A Systems Integration Example
602
Fort Lowell Trading Company
556
Exercises
561
16.4 Types of Integrated Systems 603 16.4.1 Single System Visibility Versus Multiple System 604 Visibilities 16.4.2 One Hardware Platform Versus Multiple Hardware 605 Platforms 16.4.3 One Location Versus 606 Multiple Locations
15 CONSTRUCTING A DATA WAREHOUSE SYSTEM
562
15.1 Stages of the Project
563
15.2 The Planning Stage 15.2.1 Justifying the Data Warehouse 15.2.2 Obtaining User Buy-in 15.2.3 Overcoming Resistance to the Data Warehouse 15.2.4 Developing a Project Plan
567
15.3 Data Warehouse Design Approaches
567 570
16.5 Trends in Systems Integration 16.6 The Future of DSS
571 573 576
577 15.4 The Architecture Stage 15.4.1 The Data Warehouse 577 Database 578 15.4.2 The Analysis Architecture 15.4.3 Data Warehouse Hardware 579
16.7 In Conclusion Summary Key Terms Review Questions Exercises References Fort Lowell Trading Company
597
608 611 613 613 614 614 615 615 616 619
15.5 Hints for Data Warehousing Project Success
582
Summary
586
Case 1 Options Pricing with Black-Scholes
Key Terms
588
Case 2 Truck Brake Balancing
Review Questions
588
Exercises
589
References
591
Case 3 Enterprise wide GIS: Bringing New Dimensions 629 to Decision Making Case 4 Fort Lowell Trading Company: 633 Developing the Finance DSS
[ f ^ o r t Lowell Trading Company Exercises
I?®
Appendix: Cases
591 593
620 626
CONTENTS
Case 5 A Whole New Ball Game (Sort of) Case 6 MasterCard: Mining the Possibilities Case 7 Close Call Corp.: Anatomy of a Failure
634 636
641
Case 8 Making Waves at Helene Curtis Case 9 HFS: Mega-Warehouse as Marketing Tool Index
