Compare & contrast the definitions and meanings of decision support systems (DSS
ID: 3906340 • Letter: C
Question
Compare & contrast the definitions and meanings of decision support systems (DSS), business intelligence (BI), and business analytics (BA). Explain why it is so difficult to have one definition of each. Finally, draw (use any software or scan something hand-drawn) a conceptual model of how the ideas fit together in your mind )
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Explanation / Answer
Compare & contrast the definitions and meanings of decision support systems (DSS), business intelligence (BI), and business analytics (BA).
Answer:
decision support systems (DSS):
A decision support system (DSS) is a computer-based application that collects, organizes and analyzes business data to facilitate quality business decision-making for management, operations and planning. A well-designed DSS aids decision makers in compiling a variety of data from many sources: raw data, documents, personal knowledge from employees, management, executives and business models. DSS analysis helps companies to identify and solve problems, and make decisions
Decision-making analysis was conducted by the Carnegie Institute of Technology in the late 1950s and early 1960s. The Massachusetts Institute of Technology (MIT) applied computer technology to decision-making theory in the 1960s. By the 1980s, intensive research on DSS was underway, and new theories and concepts emerged from single-user models of DSS, including organizational decision support systems (ODSSs), group decision support systems (GDSSs) and executive information systems (EISs). By 1990 DSS was broadened to include data warehousing and online analytical processing.
Typical information gathered by a DSS may include:
In some DSS applications, timely analysis includes the consequences of different decision alternatives.
DSS applications are used in many diverse fields, including medical diagnosis, credit loan verification, evaluating bids on engineering projects, business and business management, agricultural production at the farm and policy levels, forest management and railroad (for evaluation of defective rails)
Business intelligence (BI):
Business intelligence (BI) is the use of computing technologies for the identification, discovery and analysis of business data - like sales revenue, products, costs and incomes.
BI technologies provide current, historical and predictive views of internally structured data for products and departments by establishing more effective decision-making and strategic operational insights through functions like online analytical processing (OLAP), reporting, predictive analytics, data/text mining, benchmarking and Business Performance Management (BPM). These technologies and functions are often referred to as information management.
Developed in the mid-1980s, modern BI evolved from 1960s-era decision support systems (DSS), which, with help of computer-aided models, assisted with planning and decision-making, leading to executive information systems (EIS), data warehouses (DW), OLAP and BI. BI did not achieve widespread acceptance until the late 1990s.
BI software applications are used to gather data from data warehouses or data marts, which are separate yet linked BI architectural stack segments used for the preparation and use of data.
BI is used for multiple business purposes, including:
BI also involves specific methodologies and procedures for implementing such interactive information gathering techniques, including:
BI and its subset, competitive intelligence (CI), are considered synonymous. Like CI, BI is considered a decision support system (DSS). CI manages information focused on business competitors, whereas BI manages these functions (and more) by focusing on internal business products and departments.
Studies by Merrill Lynch indicate that 85 percent of all business information is made up of unstructured or semi-structured data, including emails, news, reports, Web pages, presentations, phone conversation notes, image files, video files and marketing information. In the IT industry, management of such data is considered a major unsolved problem.
Business analytics (BA):
B
usiness analytics (BA) refers to all the methods and techniques that are used by an organization to measure performance. Business analytics are made up of statistical methods that can be applied to a specific project, process or product. Business analytics can also be used to evaluate an entire company. Business analytics are performed in order to identify weaknesses in existing processes and highlight meaningful data that will help an organization prepare for future growth and challenges.
The need for good business analytics has spurred the creation of business analytics software and enterprise platforms that mine an organization’s data in order to automate some of these measures and pick out meaningful insights.
Although the term has become a bit of a buzzword, business analytics are a vital part of any business. Business analytics make up a large portion of decision support systems, continuous improvement programs and many of the other techniques used to keep a business competitive. Consequently, accurate business analytics like efficiency measures and capacity utilization rates are the first step to properly implementing these techniques.
What is Business Performance Management (BPM)?
Performance Management (BPM):
Business performance management (BPM) is a form of business intelligence used to monitor and manage a company's performance. Key performance indicators (KPI) are used for this purpose. These KPIs include revenue, return on investment, overhead and operational costs.
Business performance management is also known as corporate performance management (CPM).
BPM allows companies to collect data efficiently from various sources, analyze it and use this knowledge to improve the company's performance. BPM also allows problems to be identified before they have a chance to grow and spread into other areas of the company. Finally, it can be used to make more predictable and reliable forecasts. Continuous and real-time reviews of data are used in the BPM process.
Business performance management software has traditionally been used within finance departments, but it is now being adopted by various enterprises as a component of their business intelligence.
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