Objectives

 Define Decision Support Systems

(DSS)
BA 450
 Understand the benefits of DSS
Decision Support Systems
 Grasp the basic components of DSS
 Gain an understanding of categories
Salah BENABDALLAH, PhD and classes of DSS
Fall Semester, 2023-2024
 Overview of Intelligent Decision
Support Systems
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Decisions
A decision is just a choice from among a
set of alternatives

Decision Making

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 Decision Making
Rational Decision Process
Decision Making implies the existence of a
minimum of a following four factors :  Intelligence
1. There must be a problem.
2. There must be a decision maker.  Design
3. There must be a need to solve the
problem.  Choice
4. There must be alternative solutions to
the problem.

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Intelligence Design
 Create, invent, and devise possible
solutions

 Find problems
 Define the problem
◦ Causes, goals, constraints

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 Choice Review
 Analyze alternatives  Assess the results
 Choose  Revise, as required
 Implement

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A Framework for Decision Making

Decision maker deals with a wide range of

problems from structured ones to
unstructured ones. That is why the
A Framework for decision making processes fall along a
Decision Making continuum that ranges from highly
structured (sometimes called programmed)
to highly unstructured (non programmed)
decisions.

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 Definition of the Problem A Framework for Decision Making

Decision maker deals with a wide range of

Problem is a gap between the actual
and the desired states.
problems from structured ones to
unstructured ones. That is why the
decision making processes fall along a
continuum that ranges from highly
structured (sometimes called programmed)
to highly unstructured (non programmed)
decisions.

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Structured vs Unstructured Problems

Structured Problems
- Routine and repetitive with standard solution
- Well defined decision making procedure
- Given a well-defined set of input, a well defined
Structured vs Unstructured set of output is defined
Problems Examples of structured problems are accounting,
equation resolution, budget analysis, telephone
connection, etc.
For example: Converting a unit of measure
between its English and metric equivalents,
.
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 Structured vs Unstructured Problems Structured vs Unstructured Problems

Unstructured Problems Unstructured Problems

Lack of structure if: – All phases of decision making process are
- actual or desired state unknown; unstructured
- set of transformations unknown. – Not well defined input, output set and
In other words: procedures
- objectives not clear;
- alternatives not clear; Example: Improving Tunisia Economy
- effect of actions on outcomes not
clear.

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The DSS Focuses mainly on Semistructured Problems

Structured vs Unstructured Problems

Semi-structured Problems
- Has some structured aspect Computer Manager + Computer Manager
- Some of the inputs or outputs or procedures Solution (DSS) Solution
are not well defined Solution

Example: weather forecasting; economic planning;

intrusion detection analysis; which stock will yield
the highest return by the end of the year;etc.
Structured Semistructured Unstructured
DEGREE OF PROBLEM STRUCTURE
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 Decision Analysis of Few Decision Tables
Alternatives  Investment example

 One goal: maximize the yield after one year

Single Goal Situations
 Yield depends on the status of the economy
 Decision tables
(the state of nature)
◦ Solid growth
◦ Stagnation
◦ Inflation

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Possible Situations Possible Situations

1. If solid growth in the economy, bonds yield
12%; stocks 15%; time deposits 6.5%  Decision variables (alternatives)
2. If stagnation, bonds yield 6%; stocks 3%;
time deposits 6.5%  Uncontrollable variables (states of
economy)
3. If inflation, bonds yield 3%; stocks lose 2%;
time deposits yield 6.5%
 Result variables (projected yield)

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 Treating Uncertainty
States of Nature
Solid Stagnation Inflation  Optimistic approach
Alternatives Growth

 Pessimistic approach
Bonds 12% 6% 3%

Stocks 15% 3% -2%

CDs 6.5% 6.5% 6.5%

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Table : Decision Under Risk and Its Solution

Treating Risk
Solid Stagnation Inflation Expected
 Use known probabilities Growth Value

Alternatives .5 .3 .2
 Risk analysis: compute expected
values Bonds 12% 6% 3% 8.4% *

Stocks 15% 3% -2% 8.0%

CDs 6.5% 6.5% 6.5% 6.5%

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