Decision Support and Expert Systems

Professionals often need to select one course of action from many alternatives. Because they have neither the time nor the resources to study and absorb long, detailed reports of data and information, organizations often build information systems specifically designed to help make decisions. These systems are called decision support systems (DSSs) . While DSSs rely on models and formulas to produce concise tables or a single number that determines a decision, expert systems (ESs) rely on artificial intelligence techniques to support knowledge-intensive decision-making processes.

Decision support sy stems help find the optimal course of action and answer “What if?” questions. “What if we purchase raw materials overseas? What if we merge our warehouses? What if we double our shifts and cut our staff?” These questions seek answers like, “This is how thi s action will impact our revenue, or our market share, or our costs.” DSSs are programmed to process raw data, make comparisons, and generate information to help professionals glean the

best alternatives for financial investment, marketing strategy, credit approval, and the like. However, it is important to understand that a DSS is only a decision aid, not an absolute alternative to human decision making.

Many environments are not sufficiently structured to let an IS use data to provide the one best answer. For instance, stock portfolio management takes place in a highly uncertain environment. No single method exists to determine which securities portfolio is best, that is, which one will yield the highest return. Medical care is another unstructured environment. There might be many methods of diagnosing a patient on the basis of his or her symptoms. Indeed, a patient with a particular set of symptoms might receive as many different diagnoses as the number of doctors he or she visits.

Using ESs preserves the knowledge of retiring experts and saves a company the high cost of employing human experts. After gathering expertise from experts and building a program, the program can be distributed and used repeatedly. The expertise resides in the program in the form of a knowledge base consisting of facts and relationships among the facts. You will learn about DSS and ES in detail in Chapter 10, “Decision Support and Expert Systems.”

PART 1 THE INFORMATION AGE PART 1 THE INFORMATION AGE

Geographic information systems help associate information with locations and regions.

Commonly used GISs on the Web are Google Earth and Mapquest. They combine maps with street addresses, directions, distances, and travel time calculations. Other Web-based GISs provide real estate information. One such popular system is Zillow (www.zillow.com), which provides maps and information about homes for sale, recent sales, and price estimates.

Chapter 1 Business Information Systems: An Overview □ 21

ISs serve various purposes throughout an organization in what are known as functional business areas —in-house services that support an organization’s main business. Functional business areas include, but are not limited to, accounting, finance, marketing, and human resources. As

previously mentioned, in a growing number of organizations these systems are modules of a larger enterprise system, an SCM, or ERP system. Chapter 3, “Business Functions and Supply Chains,” discusses business functions and their systems in detail.

Decision Support and Expert Systems