Chapter 12 Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Enhancing Management Decision Making for the Digital Firm 12.1 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Objectives How can information systems help individual managers make better decisions when the problems are nonroutine and constantly changing? How can information systems help people working in a group make decisions more efficiently? 12.2 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Objectives Are there any special systems that can facilitate decision making among senior managers? Exactly what can these systems to help high-level management? What value can systems to support management decision making provide for the organization as a whole? 12.3 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Management Challenges Building information systems that can actually fulfill executive information requirements Create meaningful reporting and management decision-making processes 12.4 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Decision-Support Systems (DSS) • Computer system at the management level of an organization • Combines data, analytical tools, and models • Supports semistructured and unstructured decision making 12.5 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Decision-Support Systems (DSS) MIS and DSS MIS • Provides reports based on routine flow of data • Assists in general control of the organization 12.6 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Decision-Support Systems (DSS) MIS and DSS DSS • Emphasizes change, flexibility, rapid response, models, assumptions, ad-hoc queries, and display graphics 12.7 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Decision-Support Systems (DSS) Types of Decision-Support Systems Model-Driven DSS • Primarily stand-alone • Uses model to perform “what-if” and other kinds of analysis 12.8 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Decision-Support Systems (DSS) Types of Decision-Support Systems • Data-driven DSS: Supports decision making by allowing users to extract and analyze useful information previously buried in large databases • Datamining: Finds hidden patterns and relationships in large databases to infer rules from them and predict future behavior 12.9 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Decision-Support Systems (DSS) Window on Organizations Data Drive Customer Care at Intrawest • How does this customer care DSS help Intrawest make decisions? • How has it provided value for the firm? 12.10 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Group Decision-Support Systems (GDSS) How GDSS Can Enhance Group Decision Making • Increase the number of ideas generated • Can lead to more participative and democratic decision making 12.36 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Group Decision-Support Systems (GDSS) How GDSS Can Enhance Group Decision Making Organizational Memory • 12.37 Store learning from an organization’s history that can be used for decision making and other purposes © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise Executive Support Systems (ESS) • Focus on the information needs of senior management • Combine data from internal and external sources • Create a generalized computing and communications environment that can be focused and applied to a changing array of problems 12.38 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise Executive Support Systems (ESS) • Monitor organizational performance • Track activities of competitors • Spot problems • Identify opportunities • Forecast trends 12.39 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise The Role of Executive Support Systems in the Organization • Bring together data from the entire organization • Allow managers to select, access, and tailor data • Enable executive and any subordinates to look at the same data in the same way 12.40 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise The Role of Executive Support Systems in the Organization Drill Down • 12.41 The ability to move from summary data to lower and lower levels of detail © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise The Role of Executive Support Systems in the Organization Developing ESS • Ease of use • Facility for environmental scanning • External and internal sources of information to be used for environmental scanning 12.42 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise Benefits of Executive Support Systems • Analyze, compare, and highlight trends • Provide greater clarity and insight into data • Speed up decision making 12.43 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise Benefits of Executive Support Systems • Improve management performance • Increase management’s span of control • Better monitoring of activities 12.44 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise Executive Support Systems and the Digital Firm ESS for Competitive Intelligence • Identify changing market conditions • Formulate responses • Track implementation efforts • Learn from feedback 12.45 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise Executive Support Systems and the Digital Firm Balanced Scorecard • 12.46 Model for analyzing firm performance that supplements traditional financial measures with measurements from additional business perspectives, such as customers, internal business processes, and learning and growth © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise Enterprise-Wide Reporting and Analysis Strategic performance management tools for enterprise systems • SAP: Web-enabled mySAP.com™, Management Cockpit • PeopleSoft: Web-enabled Enterprise Performance Management (EPM) 12.47 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Executive Support in the Enterprise Enterprise-Wide Reporting and Analysis Activity-Based Costing • 12.48 Model for identifying all the company activities that cause costs to occur while producing a specific product or service so that managers can see which products or services are profitable or losing money and make changes to maximize firm profitability © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Chapter 12 Case Study Harrah’s and Mohegan Sun: A Tale of Two Casino DSS Analyze Harrah’s and Mohegan Sun using the competitive forces and value chain models Compare the business strategies of Harrah’s and Mohegan sun What role customer reward systems play in these strategies? How are they similar? How are they different? 12.49 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Chapter 12 Case Study Harrah’s and Mohegan Sun: A Tale of Two Casino DSS What kind of decision-support systems did Harrah’s and Mohegan Sun develop? How are they related to their business strategy? Are Harrah’s and Mohegan Sun successful? Which casino is more successful? Why? Can its competitive advantage be sustained? Why or why not? Are there any ethical problems raised by these casinos’ use of customer data? Explain your response 12.50 © 2005 by Prentice Hall ... © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Management Challenges Building information systems. .. can information systems help people working in a group make decisions more efficiently? 12.2 © 2005 by Prentice Hall Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management...Essentials of Management Information Systems, 6e Chapter 12 Enhancing Management Decision Making for the Digital Firm Objectives How can information systems help individual managers make better