Decision Support System- Concepts

 Introduction
A Decision Support System (DSS) is a computer-based information system that supports
business or organizational decision-making activities. DSSs serve the management, operations,
and planning levels of an organization (usually mid and higher management) and help to make
decisions, which may be rapidly changing and not easily specified in advance (Unstructured and
Semi-Structured decision problems). Decision support systems can be either fully computerized,
human or a combination of both.

DSS users see DSS as a tool to facilitate organizational processes. Some authors have extended
the definition of DSS to include any system that might support decision making.

1. DSS tends to be aimed at the less well structured, underspecified problem that upper level
managers typically face;
2. DSS attempts to combine the use of models or analytic techniques with traditional data
access and retrieval functions;
3. DSS specifically focuses on features which make them easy to use by non computer
people in an interactive mode; and
4. DSS emphasizes flexibility and adaptability to accommodate changes in the environment
and the decision making approach of the user.

DSSs include knowledge-based systems. A properly designed DSS is an interactive software-

based system intended to help decision makers compile useful information from a combination
of raw data, documents, and personal knowledge, or business models to identify and solve
problems and make decisions.
Typical information that a decision support application might gather and present includes:

 inventories of information assets (including legacy and relational data sources, cubes,
data warehouses, and data marts),
 comparative sales figures between one period and the next,
 projected revenue figures based on product sales assumptions.

 Taxonomies
Using the relationship with the user as the criterion, Haettenschwiler differentiates passive,
active, and cooperative DSS. A passive DSS is a system that aids the process of decision
making, but that cannot bring out explicit decision suggestions or solutions. An active DSS can
bring out such decision suggestions or solutions. A cooperative DSS allows the decision maker
(or its advisor) to modify, complete, or refine the decision suggestions provided by the system,
before sending them back to the system for validation. The system again improves, completes,

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and refines the suggestions of the decision maker and sends them back to him for validation. The
whole process then starts again, until a consolidated solution is generated.

Another taxonomy for DSS has been created by Daniel Power. Using the mode of assistance as
the criterion, Power differentiates communication-driven DSS, data-driven DSS, document-
driven DSS, knowledge-driven DSS, and model-driven DSS.

 A communication-driven DSS supports more than one person working on a shared task;
examples include integrated tools like Google Docs or Groove
 A data-driven DSS or data-oriented DSS emphasizes access to and manipulation of a
time series of internal company data and, sometimes, external data.
 A document-driven DSS manages, retrieves, and manipulates unstructured information
in a variety of electronic formats.
 A knowledge-driven DSS provides specialized problem-solving expertise stored as facts,
rules, procedures, or in similar structures.
 A model-driven DSS emphasizes access to and manipulation of a statistical, financial,
optimization, or simulation model. Model-driven DSS use data and parameters provided
by users to assist decision makers in analyzing a situation; they are not necessarily data-
intensive. Dicodess is an example of an open source model-driven DSS generator.

Using scope as the criterion, Power differentiates enterprise-wide DSS and desktop DSS. An
enterprise-wide DSS is linked to large data warehouses and serves many managers in the
company. A desktop, single-user DSS is a small system that runs on an individual manager's
PC.

 Components
Three fundamental components of a DSS architecture are:

1. the database (or knowledge base)

2. the model (i.e., the decision context and user criteria)
3. the user interface.

The users themselves are also important components of the architecture.

 Development Frameworks
DSS systems are not entirely different from other systems and require a structured approach.
Such a framework includes people, technology, and the development approach.The Early
Framework of Decision Support System consists of four phases:

1. Intelligence Searching for conditions that call for decision.

2. Design Inventing, developing and analyzing possible alternative actions of solution.
3. Choice Selecting a course of action among those.
4. Implementation Adopting the selected course of action in decision situation.

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DSS technology levels (of hardware and software) may include: The actual application that will
be used by the user. This is the part of the application that allows the decision maker to make
decisions in a particular problem area. The user can act upon that particular problem.
Generator contains Hardware/software environment that allows people to easily develop specific
DSS applications. This level makes use of case tools or systems such as Crystal, Analytica and
iThink. Tools include lower level hardware/software. DSS generators including special
languages, function libraries and linking modules An iterative developmental approach allows
for the DSS to be changed and redesigned at various intervals. Once the system is designed, it
will need to be tested and revised where necessary for the desired outcome.

 Classification
There are several ways to classify DSS applications. Not every DSS fits neatly into one of the
categories, but may be a mix of two or more architectures. Holsapple and Whinston classify DSS
into the following six frameworks: Text-oriented DSS, Database-oriented DSS, Spreadsheet-
oriented DSS, Solver-oriented DSS, Rule-oriented DSS, and Compound DSS. A compound DSS
is the most popular classification for a DSS. It is a hybrid system that includes two or more of the
five basic structures described by Holsapple and Whinston. The support given by DSS can be
separated into three distinct, interrelated categories: Personal Support, Group Support, and
Organizational Support. DSS components may be classified as:

1. Inputs: Factors, numbers, and characteristics to analyze

2. User Knowledge and Expertise: Inputs requiring manual analysis by the user
3. Outputs: Transformed data from which DSS "decisions" are generated
4. Decisions: Results generated by the DSS based on user criteria

DSSs which perform selected cognitive decision-making functions and are based on artificial
intelligence or intelligent agents technologies are called Intelligent Decision Support Systems
(IDSS). The nascent field of Decision engineering treats the decision itself as an engineered
object, and applies engineering principles such as Design and Quality assurance to an explicit
representation of the elements that make up a decision.

 Benefits
1. Improves personal efficiency
2. Speed up the process of decision making
3. Increases organizational control
4. Encourages exploration and discovery on the part of the decision maker
5. Speeds up problem solving in an organization
6. Facilitates interpersonal communication
7. Promotes learning or training
8. Generates new evidence in support of a decision
9. Creates a competitive advantage over competition
10. Reveals new approaches to thinking about the problem space
11. Helps automate managerial processes
12. Create Innovative ideas to speed up the performance
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 DSS characteristics and capabilities
1. Solve semi-structured and unstructured problems
2. Support managers at all levels
3. Support individuals and groups
4. Interdependence and sequence of decisions
5. Support Intelligence, Design, Choice
6. Adaptable and flexible
7. Interactive and ease of use
8. Interactive and efficiency
9. Human control of the process
10. Ease of development by end user
11. Modeling and analysis
12. Data access
13. Standalone and web-based integration
14. Support varieties of decision processes
15. Support varieties of decision trees
16. Quick response

 Applications

1. One is the clinical decision support system for medical diagnosis. Other examples include
a bank loan officer verifying the credit of a loan applicant or an engineering firm that has
bids on several projects and wants to know if they can be competitive with their costs.
2. DSS is extensively used in business and management. Executive dashboard and other
business performance software allow faster decision making, identification of negative
trends, and better allocation of business resources. Due to DSS all the information from
any organization is represented in the form of charts, graphs i.e. in a summarized way,
which helps the management to take strategic decision.
3. A growing area of DSS application, concepts, principles, and techniques is in agricultural
production, marketing for sustainable development. For example, the DSSAT4 package,
developed through financial support of USAID during the 80s and 90s, has allowed rapid
assessment of several agricultural production systems around the world to facilitate
decision-making at the farm and policy levels. There are, however, many constraints to
the successful adoption on DSS in agriculture.
4. DSS are also prevalent in forest management where the long planning time frame
demands specific requirements. All aspects of Forest management, from log
transportation, harvest scheduling to sustainability and ecosystem protection have been
addressed by modern DSSs.
5. A specific example concerns the Canadian National Railway system, which tests its
equipment on a regular basis using a decision support system. A problem faced by any
railroad is worn-out or defective rails, which can result in hundreds of derailments per
year. Under a DSS, CN managed to decrease the incidence of derailments at the same
time other companies were experiencing an increase.

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 Benefits of Tools of DSS
Decision support tools offer the following benefits for decision makers:

• Add objectivity to making decisions: Decision support software requires you to clearly define
the issues, identify relevant information, determine how factors are related, and analyze the
results. When you are making a decision, a DSS helps you evaluate all parts of the decision
objectively. For example, Quest Specialty Travel can use a graphic to determine which tour to
offer first to corporate customers.

• Improve efficiency for complex decisions: Complex decisions typically involve gathering lots
of detailed information and then ranking or assigning weights to each factor. A computer can
store information and make complex calculations much more efficiently than people can. You
use decision support software to maintain, process, and report on the detailed information
involved in complex decisions. For example, Quest is considering opening a branch office in Los
Angeles or Chicago to serve corporate customers. It can use decision support software to
compare expenses such as rent, travel, and employees and weigh factors such as proximity to
clients, staff preference, and local attractions.

• Encourage exploration and discovery: Decision support tools help you visualize data,
illustrate problems, and graphically represent options and solutions. You can easily adjust
variables and model scenarios. For example, Quest employees can use a spreadsheet to compare
the income and expenses they have now with those they expect to have with a separate business
travel department. Playing “what-if” with data encourages exploration of possibilities and can
lead to more creative solutions.

• Provide support for particular decisions: As a member of an organization, you must always
be prepared to support the decisions you make. Intuitive decisions can be difficult to defend.
When you approach a decision objectively and analyze it, you can demonstrate that you handled
the matter professionally. For example, a decision support tool can help to compare the cost and
volume of trips to find the best price.

• Help communicate decisions to other interested people: Describing the thought processes
that go into making a complex decision or solving an involved problem can be difficult. Decision
support tools and their models can help you more effectively communicate your ideas to
interested stakeholders. Figure E-2 shows the steps, processes, and decisions involved in creating
a new corporate travel department at Quest Specialty Travel.

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 Basic Tools of Decision Support System

Decision Support System tools are programs or codes which are the foundation to create the DSS
generators and in turn specific DSS. Problem formulation tools provide procedural guidance to
the managers to structure the collaborative problem. Quantitative modeling and formulation tools
improve performance. These tools also improve process gains by reducing risks arising from
incomplete task analysis, incomplete use of information and information overload.
Tools are the building blocks of the DSS. e.g. E-spreadsheets, 4GLS, RDBMS,etc. The
combination of DSS tools in the computer hardware is known as DSS generators. Decision
support tools may involve the following:

1. Material requirements planning (MRP) is a method for ordering and maintaining

materials in stock. It is a systematic approach to identify cost-beneficial ways of storing
materials. It is a production planning and inventory control system used to manage
manufacturing processes. Most MRP systems are software-based, while it is possible to conduct
MRP by hand as well. A MRP system is intended to simultaneously meet three objectives:
 Ensure materials are available for production and products are available for delivery to
customers.
 Maintain the lowest possible material and product levels in store
 Plan manufacturing activities, delivery schedules and purchasing activities.
The basic functions of an MRP system include: inventory control, bill of material processing,
and elementary scheduling. MRP helps organizations to maintain low inventory levels. It is used
to plan manufacturing, purchasing and delivering activities. Manufacturing organizations,
whatever their products, face the same daily practical problem - that customers want products to
be available in a shorter time than it takes to make them. This means that some level of planning
is required. Companies need to control the types and quantities of materials they purchase, plan
which products are to be produced and in what quantities and ensure that they are able to meet
current and future customer demand, all at the lowest possible cost. Making a bad decision in any
of these areas will make the company lose money. MRP is a tool to deal with these problems. It
provides answers for several questions:

 What items are required?

 How many are required?
 When are they required?
MRP can be applied both to items that are purchased from outside suppliers and to sub-
assemblies, produced internally, that are components of more complex items. The data that must
be considered include:

 The end item (or items) being created. This is sometimes called Independent Demand, or
Level "0" on BOM (Bill of materials).
 How much is required at a time.
 When the quantities are required to meet demand.
 Shelf life of stored materials.

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  Inventory status records. Records of net materials available for use already in stock (on
hand) and materials on order from suppliers.
 Bills of materials. Details of the materials, components and sub-assemblies required to
make each product.
 Planning Data. This includes all the restraints and directions to produce the end items.
This includes such items as: Routing, Labor and Machine Standards, Quality and Testing
Standards, Pull/Work Cell and Push commands, Lot sizing techniques (i.e. Fixed Lot
Size, Lot-For-Lot, Economic Order Quantity), Scrap Percentages, and other inputs.

2. Linear Programming assists in solving problems which involve allocation of limited

resources and evaluation of alternatives to achieve objectives. Linear programming (LP, or linear
optimization) is a method to achieve the best outcome (such as maximum profit or lowest cost)
in a mathematical model whose requirements are represented by linear relationships. More
formally, linear programming is a technique for the optimization of a linear objective function,
subject to linear equality and linear inequality constraints. Its feasible region is a convex
polyhedron, which is a set defined as the intersection of finitely many half spaces, each of which
is defined by a linear inequality. Its objective function is a real-valued affine function defined on
this polyhedron.
A linear programming algorithm finds a point in the polyhedron where this function has the
smallest (or largest) value if such a point exists. Linear programming can be applied to various
fields of study. It is used in business and economics, but can also be utilized for some
engineering problems. Industries that use linear programming models include transportation,
energy, telecommunications, and manufacturing. It has proved useful in modeling diverse types
of problems in planning, routing, scheduling, assignment, and design.

3. Queuing Theory is used in planning the activities of the organization to determine

economically beneficial queues. In queueing theory a model is constructed so that queue lengths
and waiting times can be predicted. Queueing theory is generally considered a branch of
operations research because the results are often used when making business decisions about the
resources needed to provide a service. Single queueing nodes are usually described using
Kendall's notation in the form A/S/C where A describes the time between arrivals to the queue, S
the size of jobs and C the number of servers at the node. Various scheduling policies can be used
at queuing nodes:
First in first out: This principle states that customers are served one at a time and that the
customer that has been waiting the longest is served first
Last in first out: This principle also serves customers one at a time, however the customer with
the shortest waiting time will be served first. Also known as a stack.
Processor sharing: Service capacity is shared equally between customers.
Priority: Customers with high priority are served first. Priority queues can be of two types, non-
preemptive (where a job in service cannot be interrupted) and preemptive (where a job in service
can be interrupted by a higher priority job). No work is lost in either model.
Shortest job first: The next job to be served is the one with the smallest size
Preemptive shortest job first: The next job to be served is the one with the original smallest
size
Shortest remaining processing time: The next job to serve is the one with the smallest
remaining processing requirement.

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4. Descriptive Analysis are used to estimate a parameters and the dispersion of values
associated with that parameter. These estimates are made for the various critical environmental
factors to plan the day to day operations of the organization. Descriptive statistics is the
discipline of quantitatively describing the main features of a collection of information or the
quantitative description itself. Descriptive statistics are distinguished from inferential statistics
(or inductive statistics), in that descriptive statistics aim to summarize a sample, rather than use
the data to learn about the population that the sample of data is thought to represent. Some
measures that are commonly used to describe a data set are measures of central tendency and
measures of variability or dispersion. Measures of central tendency include the mean, median
and mode, while measures of variability include the standard deviation (or variance), the
minimum and maximum values of the variables, kurtosis and skewness. Descriptive statistics
provides simple summaries about the sample and about the observations that have been made.
Such summaries may be either quantitative, i.e. summary statistics, or visual, i.e. simple-to-
understand graphs. These summaries may either form the basis of the initial description of the
data as part of a more extensive statistical analysis, or they may be sufficient in and of
themselves for a particular investigation. In the business world, descriptive statistics provides a
useful summary of many types of data. For example, investors and brokers may use a historical
account of return behavior by performing empirical and analytical analyses on their investments
in order to make better investing decisions in the future.
Univariate analysis: Univariate analysis involves describing the distribution of a single variable,
including its central tendency (including the mean, median, and mode) and dispersion (including
the range and quantiles of the data-set, and measures of spread such as the variance and standard
deviation). The shape of the distribution may also be described via indices such as skewness and
kurtosis. Characteristics of a variable's distribution may also be depicted in graphical or tabular
format, including histograms and stem-and-leaf display.
Bivariate analysis: When a sample consists of more than one variable, descriptive statistics may
be used to describe the relationship between pairs of variables. In this case, descriptive statistics
include Cross-tabulations and contingency tables, Graphical representation via scatterplots,
Quantitative measures of dependence, Descriptions of conditional distributions.

5. Correlation Analysis is made to calculate the relationship between values for particular
parameters, such as parameter values describing current conditions. Correlation is a term that
refers to the strength of a relationship between two variables. A strong, or high, correlation
means that two or more variables have a strong relationship with each other while a weak, or
low, correlation means that the variables are hardly related. Correlation coefficients can range
from -1.00 to +1.00. The value of -1.00 represents a perfect negative correlation while a value of
+1.00 represents a perfect positive correlation. A value of 0.00 means that there is no relationship
between the variables being tested.
The most widely used type of correlation coefficient is the Pearson r, which is also referred to as
linear or product-moment correlation. This analysis assumes that the two variables being
analyzed are measured on at least interval scales. The coefficient is calculated by taking the
covariance of the two variables and dividing it by the product of their standard deviations.

6. Variance Analysis is used to describe the variance between two or more variables. A
variance is the difference between a budgeted, planned or standard cost and the actual amount

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incurred/sold. Variances can be computed for both costs and revenues.The concept of variance is
intrinsically connected with planned and actual results and effects of the difference between
those two on the performance of the entity or company. Variances can be divided according to
their effect or nature of the underlying amounts.
When effect of variance is concerned, there are two types of variances:

 When actual results are better than expected results given variance is described as
favorable variance. In common use favorable variance is denoted by the letter F - usually
in parentheses (F).
 When actual results are worse than expected results given variance is described as
adverse variance, or unfavourable variance. In common use adverse variance is denoted
by the letter U or the letter A - usually in parentheses (A).

The second typology is determined by the needs of users of the variance information and may
include e.g.:

 Variable cost variances

o Direct material variances
o Direct labour variances
o Variable production overhead variances
 Fixed production overhead variances
 Sales variances

Variance analysis, in budgeting (or management accounting in general), is a tool of budgetary

control by evaluation of performance by means of variances between budgeted amount, planned
amount or standard amount and the actual amount incurred/sold. Variance analysis can be carried
out for both costs and revenues.Variance analysis is usually associated with explaining the
difference (or variance) between actual costs and the standard costs allowed for the good output.
For example, the difference in materials costs can be divided into a materials price variance and
a materials usage variance. The difference between the actual direct labor costs and the standard
direct labor costs can be divided into a rate variance and an efficiency variance. The difference in
manufacturing overhead can be divided into spending, efficiency, and volume variances. Mix
and yield variances can also be calculated.Variance analysis helps management to understand the
present costs and then to control future costs.

7. Network Analysis is a pictorial tool for identifying and sequencing tasks. These analysis
help managers in planning and controlling tasks necessary for successful operation of the
organization. Network analysis is the general name given to particular techniques which can be
used for the planning, management and control of projects. It is the breaking down a complex
data of a project into its component parts and plotting them to show their interdependencies and
interrelationships.

8. Transportation Problems are used for planning and distribution of various facilities and
resources. There is a type of linear programming problem that may be solved using a simplified
version of the simplex technique called transportation method. Because of its major application
in solving problems involving several product sources and several destinations of products, this

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type of problem is frequently called the transportation problem. It gets its name from its
application to problems involving transporting products from several sources to several
destinations. Although the formation can be used to represent more general assignment and
scheduling problems as well as transportation and distribution problems. The two common
objectives of such problems are either (1) minimize the cost of shipping m units to n destinations
or (2) maximize the profit of shipping m units to n destinations.

9. Maximum flow or distance is a tool for identifying the most economically beneficial
flow through, or distances between particular objects. This facilitates in determining the most
preferred flow of goods or services through an area or object for which the organization must
conduct business.

10. Dynamic Programming is a tool to ensure that appropriate course of action and
decisions of top level management are being followed by managers at operational level. dynamic
programming is a method for solving complex problems by breaking them down into simpler
subproblems. It is applicable to problems exhibiting the properties of overlapping subproblems
and optimal substructure (described below). When applicable, the method takes far less time than
naive methods that don't take advantage of the subproblem overlap. The dynamic programming
approach seeks to solve each subproblem only once, thus reducing the number of computations:
once the solution to a given subproblem has been computed, it is stored or "memo-ized": the next
time the same solution is needed, it is simply looked up. This approach is especially useful when
the number of repeating subproblems grows exponentially as a function of the size of the input.
Dynamic programming algorithms are used for optimization (for example, finding the shortest
path between two points, or the fastest way to multiply many matrices). A dynamic programming
algorithm will examine all possible ways to solve the problem and will pick the best solution.
Therefore, we can roughly think of dynamic programming as an intelligent, brute-force method
that enables us to go through all possible solutions to pick the best one. If the scope of the
problem is such that going through all possible solutions is possible and fast enough, dynamic
programming guarantees finding the optimal solution.

11. Regression Analysis can be used to estimate particular values on the basis of known
values for influential variables. It may be used to estimate the values of unknown variables
which may influences plans for implementing the decisions of top level managers. regression
analysis is a statistical process for estimating the relationships among variables. It includes many
techniques for modeling and analyzing several variables, when the focus is on the relationship
between a dependent variable and one or more independent variables. More specifically,
regression analysis helps one understand how the typical value of the dependent variable (or
'Criterion Variable') changes when any one of the independent variables is varied, while the other
independent variables are held fixed. Most commonly, regression analysis estimates the
conditional expectation of the dependent variable given the independent variables – that is, the
average value of the dependent variable when the independent variables are fixed. Less
commonly, the focus is on a quantile, or other location parameter of the conditional distribution
of the dependent variable given the independent variables. In all cases, the estimation target is a
function of the independent variables called the regression function. In regression analysis, it is
also of interest to characterize the variation of the dependent variable around the regression
function which can be described by a probability distribution.

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Regression analysis is widely used for prediction and forecasting, where its use has substantial
overlap with the field of machine learning. Regression analysis is also used to understand which
among the independent variables are related to the dependent variable, and to explore the forms
of these relationships. In restricted circumstances, regression analysis can be used to infer causal
relationships between the independent and dependent variables.

12. Multi-level Scaling is a tool for transforming undimensional expressions of relationships

into multi-dimensional expressions of these same relationships. These tools may be used to
determine the significant relationship which must be dealt with implanning.

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 Constructing an efficient Decision support system
The subsequent segment talks about in detail, the stages drawn in collecting necessities, designing,
constructing in addition to testing an efficient organizational decision support system.

 Requirements for the DSS:

DSS customer usually have three basic options : “Buy a DSS commercial off the shelf (COTS)
package and use it as is, buy a COTS package and modify it or build the DSS to one’s
desires”(Charles, 1998). For clients wishing a behaviorally oriented Decision Support Systems, the
COTS packages might not be available. The necessities intended for the DSS can be recognized and
developed by relating the client or organizational users. After the designer has acceptably recognized
the user necessities and transform these into system qualifications, the Decision Support System
modeling process can begin (Ariav G, 1986; Bennett J L, 1983).
In constructing a Decision Support System, a system which isn’t associated at all with other
computer system in a official network however which possibly will be linked to the internet or else
further database services. This system shall consist the subsequent five things:

 A personal computer with a floppy disk;

 A monitor, keyboard and mouse;
 A printer;
 A modem; and
 Appropriate software.

Wrembel R (2007) says that the fundamental system permits a user to accept an illustration or
auditory presentation from the computer and to enter from whichever the mouse otherwise keyboard
to computer. Some of the latest PCs also agree to voice input, but these systems are generally
restricted in their terminology and also possibly will have difficulty understanding a few of the
client’s verbiage. The PC may also get inputs through a compact disk or else a floppy disk however
these might not be instant inputs from the decision maker which/what is of concentration here.
The modem permits the client to gain data from resources like web or other electronic records. The
software must contain an operating system, internet accessibility, a RDBMS, a spreadsheet, a word
processor, a compiler in addition to a prototyping language. These are essential tools one desires to
run a computer system, to construct a Decision Support Systems that is able to be used for distinctive
decision making operations. As discussed earlier the construction of a Decision Support System
design ought to regard as that the Decision Support System will possibly be extended to contain
supplementary means as time goes by.

 Designing the DSS

In building a Decision Support System, designer be supposed to regard as so as to Decision Support
System shall probably go through a few modifications toward reaching the active requirements of the
client. Comparison rules situation can be defined as an instance of how a model can be planned so as
to it be capable of easily unmitigated afterwards. Comparison rules are four kinds: “comparison
against a standard, comparison across attributes, comparison within attributes and judgmental
comparison” (Humphreys P, 1977; Johnson J, 2008; Lucas, 2001). These rules can be placed on a
solo screen as shown:

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Zhang P (2006) says so as to the designer may construct a unique design which has just one active
rule with the aim of comparison alongside a standard. Nevertheless the system should be planned for
whichever of the four options; the user desires to broaden the ability later. The extensible model
through the designer accepting the prospective of total set of comparison rules other than the designer
need not execute everything.

 Prototyping the Decision Support System

The improvement of a prototype of the Decision Support System will start immediately after the
Decision Support System necessities are recognized and built. The prototype must be an execution of
an easy edition of design so that the user can test the screens of the Decision Support Systems.
Consider an example, a designer can build a HyperCard prototype by means of novel screen designs
to reach the client necessities although construct the screens attractive to keep the user’s
concentration on the decision procedure (Salvendy G, 2001; Vercellis C, 2009).
Immediately after a prototype has started the software should be corrected. The technique used at this
instance was to build an uncomplicated case study in the company of recognized results. The
designer can verify if the prototype is answering properly by applying the required details. Otherwise
the system has to be scrutinized to recognize the crisis and repair the prototype when the setback has
been recognized. It is a distinctive procedure to facilitate the programmers towards correcting the
software.

 Implementing the DSS

Kaminsky P (2003) states so as to consumers be able to in fact utilize prototype like an operational
system in case they are willing to. At some situations, it might signify loading prototype interpreter
for running the system although few prototyping software permit the client to hoard a run-time
system without the need of the software. E.g. ToolBook. Therefore prototyped software can be

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utilized as an operational system. On the other hand, the majority clients desire a resourcefully
planned software package intended for the Decision Support Systems. It shall need encoding throw-
away prototyped system within an operational programming language like Visual Basic.

 Testing and Evaluating the DSS

According to Oishi M K (2010), testing and evaluation method purpose is in the direction of
permitting organizational consumer to research on the Decision Support Systems to observe whether
it works as they are willing it to and perceive the means to enhance the Decision Support System
screens. In case of any errors, the consumer must note down the errors and explain the requirements
they are wishing to have.

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 Decision Trees
A decision tree is a decision support tool that uses a tree-like graph or model of decisions and
their possible consequences, including chance event outcomes, resource costs, and utility. It is
one way to display an algorithm. Decision trees are commonly used in operations research,
specifically in decision analysis, to help identify a strategy most likely to reach a goal.

A decision tree is a flowchart-like structure in which internal node represents test on an attribute,
each branch represents outcome of test and each leaf node represents class label (decision taken
after computing all attributes). A path from root to leaf represents classification rules. In decision
analysis a decision tree and the closely related influence diagram is used as a visual and
analytical decision support tool, where the expected values (or expected utility) of competing
alternatives are calculated. A decision tree consists of 3 types of nodes:

 Decision nodes - commonly represented by squares

 Chance nodes - represented by circles
 End nodes - represented by triangles

Decision trees are commonly used in operations research, specifically in decision analysis, to
help identify a strategy most likely to reach a goal. If in practice decisions have to be taken
online with no recall under incomplete knowledge, a decision tree should be paralleled by a
probability model as a best choice model or online selection model algorithm. Another use of
decision trees is as a descriptive means for calculating conditional probabilities.

Decision trees, influence diagrams, utility functions, and other decision analysis tools and
methods are taught to undergraduate students in schools of business, health economics, and
public health, and are examples of operations research or management science methods.

Decision Tree Building blocks

Decision tree elements

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Drawn from left to right, a decision tree has only burst nodes (splitting paths) but no sink nodes
(converging paths). Therefore, used manually, they can grow very big and are then often hard to
draw fully by hand. Traditionally, decision trees have been created manually - as the aside
example shows - although increasingly, specialized software is employed.

Decision tree using flow chart symbols

Commonly a decision tree is drawn using flow chart symbols as it is easier for many to read and
understand.

Analysis example
Analysis can take into account the decision maker's (e.g., the company's) preference or utility
function, for example:

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The basic interpretation in this situation is that the company prefers B's risk and payoffs under
realistic risk preference coefficients (greater than $400K—in that range of risk aversion, the
company would need to model a third strategy, "Neither A nor B").

Another example

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Decision trees can be used to optimize an investment portfolio. The following example shows a
portfolio of 7 investment options (projects). The organization has $10,000,000 available for the
total investment. Bold lines mark the best selection 1, 3, 5, 6, and 7, which will cost $9,750,000
and create a payoff of 16,175,000. All other combinations would either exceed the budget or
yield a lower payoff.

Influence diagram
A decision tree can be represented more compactly as an influence diagram, focusing attention
on the issues and relationships between events.

The squares represent decisions, the ovals represent action, and the diamond represents results.

Advantages and disadvantages

Amongst decision support tools, decision trees (and influence diagrams) have several
advantages. Decision trees:

 Are simple to understand and interpret. People are able to understand decision tree
models after a brief explanation.
 Have value even with little hard data. Important insights can be generated based on
experts describing a situation (its alternatives, probabilities, and costs) and their
preferences for outcomes.
 Possible scenarios can be added
 Worst, best and expected values can be determined for different scenarios
 Use a white box model. If a given result is provided by a model.
 Can be combined with other decision techniques. The following example uses Net
Present Value calculations, PERT 3-point estimations (decision #1) and a linear
distribution of expected outcomes (decision #2):

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Disadvantages of decision trees:

 For data including categorical variables with different number of levels, information gain
in decision trees are biased in favor of those attributes with more levels.
 Calculations can get very complex particularly if many values are uncertain and/or if
many outcomes are linked.

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