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Decision Support System

The system has three phases viz. Intelligence, Design, Choice. The decision support system basically helps the information system in the Intelligent phase where the objective is to identify the problem and then go to the design phase for solution. Or A decision support system can be defined simply as a system that provides information for making semi-structured and unstructured decisions. Hence the decision support system refers to a class of system which supports in the process of decision making and does not always give a decision itself.

Attributes of Decision Support System:1. Flexibility:- The systems are flexible so that any semi-structured or unstructured decision
making situation can be tackled with ease and speed.

2. Simple Models :- The system are simple models of decision making. The only
change is that a different set of information is sought for the user of different models. The choice of the model depends upon the complexity of decision making.


Database:- The decision support system needs database (s). The system calls for several inputs from database for decision making. Types of Decision Support System:1. Data Analysis System: - These decision systems are based on comparative analysis and use of
a formula or an algorithm. But these processes are not structured and therefore vary. The cash flow analysis, the inventory analysis are the examples of the analysis system. This system is used at lower level of the organization to analyses files containing curve or historical data. e.g. budget analysis system or financial system for analyzing alternative investment opportunities.

2. Information Analyses System:- In this system, the data is analyzed and information
Reports are generated. The reports might be having exaptions as a feature. The decision makes Use these reports for assessment of the situation for decision making. The sales analysis, the accounts receivable system, the market research analysis are examples of the system. 3.

Accounting Models:- Accounting models calculate the consequences of planned
actions on the basis of accounting definition. They typically generate estimates of income, projected P&l a/c and balance sheet etc. based on variation in input values to the definitional formulae. Examples of accounting models are budgeting system and other short-term planning tools. These systems are used by staff analysts and managers. Usage pattern is in the form of input estimates of an activity, estimated monetary results of the activity etc.


Representational Models:- Representational models estimate the consequences of actions
on the basis of models, that represents some non-definitional characteristics of the system. Such as probabilities of occurrence of events. They include all simulation models that contain elements beyond accounting definitions of risk analysis model using estimated probability distribution for each of the key. Usage pattern is in the form of input for possible decisions and receiving estimated results as output.


Optimization Models:- Optimization models provide guidelines for action by generating
optimal solution consistent with a series of constraints. These models are used for decisions

that can be described mathematically and where a specify objective, such as minimization of cost/maximization of revenue can be established.

Components of Decision Support System:1. Database 2. Model Base 3. DSS Software

1. Database:Database is a prerequisite for developing any type of information system. Database is a collection of current and historical data from a number of groups or applications, and these are organized for easy access by a range of applications. Since DSS require data from various functional areas of an organization – production, marketing, finance, and human resources, database must contain data of all these functional areas.

*Some large organizations do not provide direct access to a central database to DSS because of two reasons:•
Organizations want to protect data from accidental or inappropriate changes in the database. • It is a slow and expensive process for the DSS to search through large database. The process affects not only the performance of the DSS but also the other systems using the database. Hence such organization creates separate DSS database extracting relevant data from both internal and external sources.

2. Model Base:A model base is a collection of mathematical and analytical models that can be made accessible to the DSS users. A model is an abstract representation that illustrates the various components or relationships of a phenomenon. Models may be of different types –  Physical model (model of a machine)  Mathematical model (equation, formula)  Verbal model (description of a procedure for doing work).

3. DSS Software:The third component of a DSS is DSS Software System. DSS Software System permits easy interaction b/w the users and database and model base. It manages the creation of storage and retrieval of models from the model base and integrates them with data in the database. DSS are meant for relatively higher level managers who are not experts in computer handling, the user-DSS interface must be easy so that relevant information is extracted without much pain. Since each manager may have his own unique working style, the DSS Software System must offer this flexibility eq MS-excel provides such facilities.