Marketing Management

Unit No. 5 – Decision Support System

Faculty Name : Dr.Shalaka.

• Concepts of Decision Making

• Decision Making Phase

• Decision Supports System

• Difference between DSS & MIS

Concept of Decision Making

-Decision making has come from the word ‘decide’ which means to come to a
conclusion.
-A decision represents a course of behaviour selected from a number of possible
alternatives.
-Decision making on the other hand is a process of selecting one optimum
alternative from among different alternatives.
-Decision is the final product of the decision making process.
-It is implied that decision making envisages two or more alternatives from which a
final decision can be made.
-If there is no option, there is no decision to be made.
-Decision making includes all the activities of coordinating, information processing,
and evaluating that usually precede a decision.

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Decision Making Phases

According to SIMON’s model of decision making there are 3 major phases in decision
making :
i. Intelligence Phase –
a. Problem searching b. Problem formulation

Problem searching –
-In actual practice the reality or actual is compared to some standard.
-Differences are measured.
-Differences are evaluated to determine whether there is any problem or not.

Problem formulation –
When the problem is identified, the problem is well understood and stated clearly.
Many a times clearly stating the problem is sufficient, however in case of complex
problems the problem needs to be simplified by determining its boundaries,
breaking it down into smaller manageable sub-problems.

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ii. Design Phase :
In this phase, the decision maker identifies alternative courses of action to solve the
problem.
Inventing and developing alternatives is a crucial activity and involves exploring all
possible alternatives. It can be done with the help of activities like brain storming,
checklists, analogies etc.

iii. Choice Phase :

At this stage one of the alternatives developed in design phase is selected and is
called as a decision.
For selecting an alternative detailed analysis of each and every alternative is made.

In Simon’s model of decision making the flow is from intelligence to design to choice.
However at any stage the decision maker may return to a previous phase.

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Decision Support Systems

Definition :
Decision Support System is an information system used to support decision making
in an organization or business.

-DSS allows users to navigate through and analyze massive data and compile
information that can be used to solve problems and make better decisions.
-Benefits of DSS include more informed decision making, timely problem solving and
improved efficiency for dealing with problems with rapidly changing variables.
-DSS is mainly used by mid – upper level management.
-The primary purpose of using DSS is to present information to the customers in a
way that is easy to understand. DSS is beneficial as it can be programmed to
generate many types of reports, all based on user specifications. DSS is also helpful
while the manager is travelling, to keep him updated with all the information at all
times which in turn provides them the ability to make the best decisions for their
company.

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Difference between DSS & MIS

Information of DSS is always used in taking decision.

Information of MIS may or may not be used in taking decision.

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Thank You