Clarisse A.

Semana 03/22/2023

Define and explain the functions and importance of decision support systems?

A Decision Support Systems "DSS" is a computer aided software that helps organizations
or businesses make decisions, judgments, and plan courses of action. Decision support systems
combine data and expertise from many areas and sources to offer users with information that goes
beyond standard reports and summaries. This is meant to assist individuals in making informed
judgments. Where in the DSS sifts through and analyzes vast amounts of data to gather complete
information that can be used to solve problems and make decisions in which it may employ
information like objective or predicted revenue, sales statistics or historical data from various time
periods, and other inventory or operational data.

The Decision Support System has a lot of functions and uses namely the Model Building,
Risk Analysis, Goal Oriented, Graphical Analysis, and What-if Analysis where in.

1. Model Building -DSS aids decision-making by identifying the most appropriate model
to solve a problem. Design an appropriate model by considering input variables, interrelationships
between variables, problem assumptions, and constraints. Example: A television manufacturer has
tasked its marketing managers with developing a sales forecasting model for color television sets.

2. Risk Analysis - DSS is especially useful when making medium- or high-risk decisions.
Decisions can represent low, medium, or high risk. DSS helps organizational managers assess the
risks of different alternatives and aids in decision making.

3. Goal Oriented - This activity is related to the process of determining the values of inputs
required to achieve a specific goal. For example, when deciding on a house, people first calculate
the appropriate monthly installments that they can afford and the duration of those installments.

4. Graphical Analysis -It presents large amounts of data in a graphical format for easy and
fast visualization. Managers can also see the impacts of different courses of action. The use of
graph is recommended when:

i) Forecasting

ii) Detecting Trends over time

 iii) A quick summary of data is required

iv) Composing points and patterns at different variables

5. What-if Analysis -In this activity, the end user changes variables or relationships
between them and notices the resulting change in other variables. Example: If his advertising costs
were reduced by 10%, what would be the impact on sales?

The importance of a Decision support systems is that it provides better-informed decision-

making process, faster problem-solving, and more efficiency in dealing with difficulties of
operations, planning, and even management. The other importance of DDS are as follows:

1. Facilitating Communication- DSS helps indicate when certain actions should be

accepted in the future or why certain actions were accepted in the past. DSS is used as a tool to the
benefit of the company as it facilitates interpersonal communication.

2. Increasing Organizational Control-The DSS manages this information, which managers

use to assess individual productivity in terms of quantity and quality of decision-making capacity.
Some DSS can assess an individual's decision-making ability.

3. Improving Personal Efficiency-DSS helps improve personal efficiency. It doesn't really

do you any good, but it does help you get everything done faster and more efficiently. For example,
prior to the advent of spreadsheet software, budgeting was done manually, but with DSS there are
fewer error changes and work can be done faster.

4. Promoting Learning or Training- Encouraging Learning or Training - DSS helps people

learn more about computers and the software packages that come with them. That wasn't the
motivation for DSS, but it also facilitates learning.

5. Improving Problem Solving- DSS helps individuals or groups solve problems faster and
more accurately. If it is more likely to be applied, it will make the task more efficient. It helps
solve the problem as a whole.