Enabling the organization - Decision Making (Chapter 9)

Making Business Decisions

 The decision-making process

- process of making decision plays a crucial role in communication and leader-ship for operational, managerial, and strategic projects.

Decision-making essentials

- a few key concepts about organizational structure will help our discussion of MIS decision making tools.

Operational

- at the operational level, control,and maintain core business business required to run the day-to-day operations. Considered structured decisions, which arise in situations where establish processes offer potential solutions.

Managerial

- at the managerial level, employees are continuously evaluating company operations to hone the firm's abilities to identify, adapt to, and leverage change. Considered semistructured decisions, they occur in situations in which a few established processes help to evaluate potential solutions, but not enough to lead to a definite recommended decision.

Strategic

- at the strategic level, manegers develop overall business strategic, goals, and objectives as part of the company's strategic plan. Highly unstructured decisions, occurring situations in which no procedures or rules exist to guide decision makers towards the correct choice.

Support : Enhancing Decisions Making with MIS

Operational support systems

- Transactional information encompasses all the information contained within a single business process or unit of work. Primary purpose is to support the performance of daily operational or structured decisions.

- Online transactional processing (OLTP) is the capture of transaction and event information using technology.

- Transactional processing system (TPS) is the basic business system that serves the operational level (analysts) and assists in making structured.

Managerial support systems

- Analytical information encompassess all organizational information, and its primary purpose is to support the performance of managerial anlysis or semistructured decisions.

- Online analytical processing (OLAP) is the manipulation of information to create business intelligence in support of strategic decision making.

What-if analysis - checks the impacts of a change in a variable or assumption on that model.

Sensitive analysis - a special case of what-if analysis, is the study of the impact on the other variables when one variables is changed repeatedly.

Goal-seeking analysis - finds the inputs necessary to achieve goal such as a desired level of output.

Optimization analysis

- an extension of goal-seeking analysis, finds the optimum value for a target variable by repeatedly changing other variables.

Strategic Support Systems

 Executive information systems (EIS) is a specialized DSS that supports senior-level executives and unstructured, long-term, nonroutine decisions requiring judgment, evaluation, and sight.

Consolidation

- the aggregation of data from simple-\ roll-ups to complex groupings of interrelated information.

Drill-down

- enables users to view details, and details of details, of information.

Slice-and-Dice

- the ability to look at information from different perspectives.

The Future : Artificial Intelligence

Artificial intelligence (AI) - stimulates human thinking and behaviour, such as the ability to reason and learn.

* Expert systems

*Neutral networks

*Generic algorithms

*Intelligent agents

*Virtual reality

Accessing Organizational Information - Data Warehouse (Chapter 8)

What is DATA WAREHOUSE?

Data Warehouse Fundamentals

Data warehouse – a logical collection of information – gathered from many different operational databases – that supports business analysis activities and decision-making tasks

The primary purpose of a data warehouse is to combined information throughout an organization into a single repository for decision-making purposes – data warehouse support only analytical processing

Data Warehouse Model

Extraction, transformation, and loading (ETL) – a process that extracts information from internal and external databases, transforms the information using a common set of enterprise definitions, and loads the information into a data warehouse.

Data warehouse  then send subsets of the information to data mart.

Data mart – contains a subset of data warehouse information

Data Warehouse Model

Multidimensional Analysis and Data Mining

Relational Database contain information in a series of two-dimensional tables.

In a data warehouse and data mart, information is multidimensional ,  it contains layers of columns and rows

Dimension – a particular attribute of information. 

Multidimensional Analysis and Data Mining

Cube – common term for the representation of multidimensional information

Once a cube of information is created, users can begin to slice and dice the cube to drill down into the information.

Users can analyze information in a number of different ways and with number of different dimensions.

Data mining – the process of analyzing data to extract information not offered by the raw data alone. Also known as "knowledge discovery" – computer-assisted tools and techniques for sifting through and analyzing vast data stores in order to find trends, patterns, and correlations that can guide decision making and increase understanding.

To perform data mining users need data-mining tools

Data-mining tool – uses a variety of techniques to find patterns and relationships in large volumes of information. Eg: retailers can use knowledge of these patterns to improve the placement of items in the layout of a mail-order catalog page or Web page.

Information Cleansing or Scrubbing

An organization must maintain high-quality data in the data warehouse

Information cleansing or scrubbing – a process that weeds out and fixes or discards inconsistent, incorrect, or incomplete information

Occur during ETL process and second on the information once if is in the data warehouse

The information cleansing or scrubbing 

v  Information Cleansing or Scrubbing Standardizing Customer name from Operational System

v  Information cleansing activities

v  Accurate and complete information

Business Intelligence

v  Business intelligence – refers to applications and technologies that are used to gather, provide access, analyze data, and information to support decision making effort.

v  these systems will illustrate business intelligence in the areas of customer profiling, customer support, market research, market segmentation, product profitability, statistical analysis, and inventory and distribution analysis to name a few

Eg: Excel, Access

Chapter 7 (Storing Organizational Information)

What is Information

v  Relational Database Fundamentals

v  Information is everywhere in an organization

v  Information is stored in databases

§  Database – maintains information about various types of objects (inventory), events (transactions), people (employees), and places (warehouses)

Relational Database Fundamentals

v  Database models include:

§  Hierarchical database model – information is organized into a tree-like structure (using parent/child relationships) in such a way that it cannot have too many relationships

§  Network database model – a flexible way of representing objects and their relationships

§  Relational database model – stores information in the form of logically related two-dimensional tables

Entities and Attributes

v  Entity – a person, place, thing, transaction, or event about which information is stored

§  The rows in each table contain the entities

§  Attributes (fields, columns) – characteristics or properties of an entity class

§  The columns in each table contain the attributes

Keys and Relationships

v  Primary keys and foreign keys identify the various entity classes (tables) in the database

§  Primary key – a field (or group of fields) that uniquely identifies a given entity in a table

§  Foreign key – a primary key of one table that appears an attribute in another table and acts to provide a logical relationship among the two tables

Keys and Relationships

v  Potential relational database for Coca-Cola

Relational Database Advantages

v  Database advantages from a business perspective include

§  Increased flexibility

§  Increased scalability and performance

§  Reduced information redundancy

§  Increased information integrity (quality)

§  Increased information security

Increased Flexibility

v  A well-designed database should:

§  Handle changes quickly and easily

§  Provide users with different views

§  Have only one physical view

•          Physical view – deals with the physical storage of information on a storage device

§  Have multiple logical views

•          Logical view – focuses on how users logically access information

Increased Scalability and Performance

v  A database must scale to meet increased demand,  while maintaining acceptable performance levels

§  Scalability – refers to how well a system can adapt to increased demands

§  Performance – measures how quickly a system performs a certain process or transaction

Reduced Information Redundancy

v  Databases reduce information redundancy

§  Redundancy – the duplication of information or storing the same information in multiple places

v  Inconsistency is one of the primary problems with redundant information

Increase Information Integrity (Quality)

v  Information integrity – measures the quality of information

v  Integrity constraint – rules that help ensure the quality of information

§  Relational integrity constraint

§  Business-critical integrity constraint

Increased Information Security

v  Information is an organizational asset and must be protected

v  Databases offer several security features including:

§  Password – provides authentication of the user

§  Access level – determines who has access to the different types of information

§  Access control – determines types of user access, such as read-only access

Database Management Systems

v  Database management systems (DBMS) – software through which users and application programs interact with a database

DATA-DRIVEN WEB SITES

v  Data-driven Web sites – an interactive Web site kept constantly updated and relevant to the needs of its customers through the use of a database

Data-Driven Web Site Business Advantages

v  Development

v  Content Management

v  Future Expandability

v  Minimizing Human Error

v  Cutting Production and Update Costs

v  More Efficient

v  Improved Stability

Data-Driven Business Intelligence

v  BI in a data-driven Web site

  Integrating Information 

v  Integration – allows separate systems to communicate directly with each other

§  Forward integration – takes information entered into a given system and sends it automatically to all downstream systems and processes

§  Backward integration – takes information entered into a given system and sends it automatically to all upstream systems and processes

GROUP ASSIGNMENT ONLINE

Nur Atika Binti Aziz

Fatin Amni Mastura Binti Kamarulzaman Hassan

Suzila Binti Muhammad

Nurul Hidayah Binti Sidek

Nurul Nadia Binti Zainuddin

Information technology (IT) is a field concerned with the use of technology in managing and processing information . Information technology is an important enabler of business success and innovation . Nowadays ,  IT is everywhere  . So it became our main sources in daily life to search an information from this source .

So there are 6 example characteristics common that we can used to gain the high quality

 information :

  

 If we just take the information from Facebook for our research paper ;

• we may expose to an fake info
• lack of information
• information not accurate

For our opinion , maybe Facebook should increase the level of privacy to people who want to update any information .

Valuing organizational information (chapter 6)

Organization information 

Information is everywhere in an organization. When addressing a significant business issue , employees must be able to obtain and analyze all the relevant information so they can make the best decision possible .

The value of transactional and analytical information

The value of timely information

Real time information means immediate, up-to-date information. Real time systems provide real-time information in response to query requests .

The value of quality information

Understanding the costs of poor information

•       Inability to accurately track customers
•       Difficulty identifying the organizations’ most valuable customers
•      Inability to identifying selling opportunities
•       Difficulty tracking revenue because of inaccurate invoices
•       Inability to build strong relationship .

Understanding the benefits of good information   

1)      Can significantly improve the chance of making a good decision and directly increase an organization’s bottom line

2)      Ex: Lillian Vernon Corp, a catalog company, used web analytics to discover that men preferred to shop at Lillian Vernon’s website instead of looking through its paper catalog. 

Organization structure that support strategic initiative (Chapter 5)

IT roles and responsibilities

·         The chief information officer (CIO) is responsible for 1) overseeing all uses of information technology 2) ensuring the strategic alignment of IT with business goals and objectives.

CIO include:

 1) manager 

 2) leader 

 3)communicator

·         The chief technology officer (CTO) responsible to ensuring the throughput, speed, accuracy, availability and reliability of an organization’s information technology .

·         The chief security  officer (CSO) responsible for ensuring the security of IT systems and developing strategies , IT safeguards against attacks from hackers and viruses .

·         The chief privacy officer (CPO) responsible for ensuring the ethical and legal use of information within an organization .

·         The chief knowledge officer (CKO) responsible for collecting , maintaining , and distributing the organization’s knowledge .

The gap between business personnel and IT personnel

Business personnel possess expertise in functional areas expertise. It personnel have their own vocabularies consisting of acronyms and technical terms, effective communication between IT personnel should be a two-way street with each side making the effort to better understand the other . 

Measuring the success of strategic initiative (Chapter 4)

IT has become an important part of organizations’ strategy, competitive advantage, and profitability.

Peter Ducker, a famous management guru, once stated that if you cannot measure it, you cannot manage it

 Define Merits a.k.a KPI (Key performance indicators)

Are the measure that are tied to business drivers. Metrics are the detailed measures that feeds those KPIs .

Efficiency and Effectiveness

Are two primary types of IT metrics. Effeciency IT metrics measure the performance of the IT system itself including throughput, speed, and availability. Effectiveness IT metrics measure the impact IT has on business processes and activities including customers satisfaction, conversion rates, and sell-through increases .

Benchmarking- Baseline Metrics

Of what is measured, how it is measured , and whether it is for the sake of efficiency or effectiveness, there must be benchmarks, or baseline values the system seek to attain. Benchmarking is a process of continuously measuring the system results, comparing those results to optimal system performance , and indentifying steps and produces to improve system performance.

The interrelationships of efficiency and effectiveness it metrics .

Customers relationship management (CRM) metrics

To track and monitor using reporting and real-time performance .

Business process reengineering (BPR) and enterprise resource planning (ERP) metrics