Decision Support Systems (DSS)
Decision Support System (DSS) is a computer-based system that aids the decision-making process of an organization. It helps managers to make decisions in situations when there is uncertainty about the possible outcomes of those decisions or when decisions are based on intuition. For example, decisions related to organizational operations, industrial processes, investment portfolios, and efficiency of manufacturing plants.
Table of Content
- 1 Decision Support Systems (DSS)
- 2 Functioning of Decision Support Systems (DSS)
- 3 Components of Decision Support Systems (DSS)
- 4 Types of Decision Support Systems (DSS)
- 5 Application of DSS
- 6 Benefits of DSS
- 7 Group Decision Support System (GDSS)
Functioning of Decision Support Systems (DSS)
DSS provides intelligent access to relevant knowledge and enables managers to make optimal choices. Proper application of DSS increases the efficiency, productivity, and effectiveness of an organization. The functioning of DSS has been divided into three phases, which are explained as follows:
- Intelligence phase: In this phase, managers identify the problem for which a decision is to be taken.
- Design phase: This is the second phase wherein all possible solutions to the problem are identified.
- Choice phase: This is the last stage in which the most appropriate solution is selected.
Components of Decision Support Systems (DSS)
DSS is made of various components, which are explained as follows:
- User interface: It is a medium between a user and the system that allows the user to communicate and interact with the system to support decision-making.
- Database: It is a collection of historical and current records that have been stored in DSS. The database can be accessed anywhere and anytime by anybody in the organization.
- Network: It is a collection of computers, servers, terminals, and other such components. A network allows the sharing of resources among different users of DSS.
- Software: It is a collection of various mathematical and analytical tools that helps in retrieving information from the database and interpreting it to make sound business decisions.
Types of Decision Support Systems (DSS)
In an organization, there can be different types of DSSs used.
The communication-driven support system is designed to help internal teams in an organisation using Web or client-server technology. Examples of communication-driven DSS are chats, instant messaging software, and online collaboration.
Data-driven DSS helps in filtering relevant information from a database or data warehouse so that it can be easily used by managers. Data-driven DSS is deployed through mainframe systems, client-server links, or the Web.
Document-driven DSS is implemented in organizations by using Web or client-server technology. This type of DSS is used by the organization where user groups are comparatively large. The main purpose of a DSS is to search Web pages and find documents on a specific set of keywords or search terms.
This type of DSS is mainly used to get management advice or select products or services. The deployment technology used to set up knowledge-driven DSS can be client/server systems, Web, or software running on PCs.
Model-driven DSS is a complex decision support system as it helps in evaluating various decisions considered by the management and selecting the best one. This system is implemented using client-server technology or web and software and hardware in the stand-alone computer systems.
Application of DSS
In an organization, DSS can provide information on comparative sales figures, projected revenue figures, etc. DSS can be used in various sectors to facilitate efficient decision-making. The following are the applications of DSS in different sectors:
- Medical: In the medical sector, clinical DSS are used for medical diagnosis.
- Banks: In banks, DSS helps loan officers to verify the credit of a loan applicant.
- Business and management: DSS enables managers to make optimal allocations of resources and make quick decisions related to various business decisions.
- Agriculture: One major application of DSS is in agriculture production and marketing for sustainable development.
- Railways: DSS provides information on worn-out or defective rails and requirements for equipment testing.
From the discussion so far, you must have understood that DSS plays an important role in the decision-making process of an organization.
Benefits of DSS
Apart from this, the following are some benefits of DSS:
- Facilitates quick decision-making; thereby increasing organizational efficiency.
- Increases organizational control and improves interpersonal communication.
- Promotes learning by speeding up problem-solving in the organization.
- Automates managerial processes and enables the organization to achieve a competitive advantage.
Group Decision Support System (GDSS)
In an organization, many decisions require the collaboration and participation of multiple employees. Take an example of a consumer durable product manufacturing company, which is losing its market share to its competitors. The company needs to take a decision on whether to keep selling its existing range of products or focus only on its best-selling products or add new products. Making such decisions often require input from different departments within the organization.
For this, individuals from different departments need to collaborate, share information and discuss decisions that need to be made. In such cases, meeting face-to-face is not always possible or practical. To deal with such situations, technologies can be used that may help in sharing the same information with everyone in the group so that they can reach to a better decision. Here comes the role of the Group Decision Support System (GDSS), which supports groups in decision-making by combining DSS and groupware technologies.
Group Decision Support System (GDSS) can be defined as an information system that is designed to support decisions made by groups in an organization. The main aim of GDSS is to facilitate group communication and foster learning. A GDSS is helpful in situations involving meeting scheduling and documentation; brainstorming; group discussions; visioning; planning; team building; etc. Moreover, it enables users or group members to solve complex problems, formulate detailed plans and proposals, manage conflicts, and effectively prioritize activities.
GDSS helps group members not only make better decisions but also improve tasks in an improved manner. Take the example of Groupware, a software, used to support groups in coordinating and keeping track of ongoing projects and tasks. Groupware extends collaboration in a group and assists the group members in completing tasks. GDSS is designed in such a way that they take input from multiple users interacting concurrently with the systems to decide as a group.
Components of Group Decision Support System (GDSS)
GDSS performs operations through its various components.
Let us discuss these components in detail.
- Hardware: It involves physical devices of a computer system, such as monitors, servers, electronic display boards, keyboards, and audio-visual equipment. It also includes a conference facility for group discussion and teamwork.
- Software: It includes several tools and techniques to operate GDSS. These tools are electronic questionnaires, brainstorming tools, idea organizers, etc. The application of these tools helps in planning, organizing ideas, collecting information, defining priorities, documenting meeting proceedings, taking decisions, and so on.
- People: It involves group members, a trained facilitator who helps in the proceedings of meetings, and an expert staff to operate and control hardware and software.
Model of Group Decision Support System (GDSS)
As mentioned earlier, GDSS supports groups in an organization in taking complex business decisions. The GDSS model enables groups in planning, generating, organising, and assessing ideas for problem solving.
Let us discuss the functioning of GDSS.
- Electronic questionnaire: It is used by group members for planning meetings, and determining crucial issues and related information for decision-making. By using electronic questionnaires, groups can acquire the required information for finding optimal solutions and making effective decisions.
- Electronic brainstorming tools: Group members use these tools for providing suggestions, which help the management in arriving at certain decisions. These tools are used to solve problems at organizational levels.
- Idea organizers: In meetings, individuals offer various ideas for problem-solving. Idea organizers help in classifying idea providers so that it can be easier to consult the concerned personnel for further clarifications.
- Prioritization tools: These tools are used for prioritizing ideas provided by group members during brainstorming. For setting priorities, various methods are used, such as voting and ranking.
- Stakeholders’ identification and analysis tools: These tools are used to understand the impact of emerging ideas on the functioning of an organization.
- Policy creation tools: These tools provide a platform to arrive at an agreement on the basis of the policy statement established by the organization.
- Group dictionaries: These are used for recording all important terms associated with the proposed project for future reference.
Advantages of Group Decision Support System (GDSS)
As discussed earlier, GDSS supports decisions by members of a group in an organization. The following are the advantages of GDSS:
- GDSS helps managers to take better decisions even after a large organizational hierarchy.
- It facilitates group communication and eliminates the influence of a single decision-maker.
- GDSS provides a facility for videoconferencing, which enables members to hold meetings at a common place from different geographical locations.
- It is user-friendly and can be accessed by people from a non-technical background.
Limitations of Group Decision Support System (GDSS)
Besides having various advantages, the system also has certain disadvantages:
- The implementation of GDSS requires huge costs, time, and effort.
- The chances of misuse or leakage of information are quite high as there are multiple users of GDSS.
- The risk of technical faults always remains there.
- GDSS is not helpful in situations that require one-to-many communication; for instance, a leader taking lectures in a group.