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CIS 429—Chapter 9
Enabling the Organization—
Decision Making
Decision Making
• An organization may acquire and store vast
amounts of data and ______________
• How can these data be used to make good
business decisions?
• A _____ is an abstraction (simplification) of reality
• An organization can use information to construct a
model for decision-making
Transaction Processing Systems
• Online transaction processing (OLTP) captures and
stores basic transactional data
• A transaction processing system (TPS) is the
system that serves ___________ tasks; for
example
– Payroll system
– Order-entry system
• Online __________ processing (OLAP) is the
processing of information to create business
intelligence to support strategic decision making
Decision Support Systems
• A decision _________ system (DSS) models
information to support managerial decisionmaking
• Three quantitative models used by DSSs
– What-if analysis
• What happens to the output, IF various inputs are changed?
• Often performed using ______________
– Sensitivity analysis
• How sensitive are the ________ to changes in the inputs?
– Goal-seeking analysis
• What inputs are necessary to achieve predetermined goals?
• A _____ supplies the basic data used by a DSS
Executive Information Systems
• An EIS is a DSS that supports top-level executive
decision-making
• Capabilities of many EISs
– Consolidation (___________ of information to complex
groupings)
– Drill-down (acquiring more detailed information when
needed)
– Slice-and-dice (viewing information from different
perspectives)
• Digital dashboards
– EIS that integrates information from multiple sources,
_________ to the individual preferences of executives
Artificial Intelligence (AI)
• Artificial intelligence is HW and SW that simulates
_______ intelligence to solve problems
• An AI system is a commercial application of
artificial intelligence; types of AI systems are
– Expert systems (imitate the reasoning of an expert)
– Neural networks (imitate the working of the human
______ by detecting patterns in data or using fuzzy
logic)
– Genetic algorithms (imitates evolutionary, survival of
the fittest processes)
– Intelligent ______ (a special-purpose knowledge-based
system that performs specific task for a user)
Data Mining
• Wal-Mart applies to point-of-______ (POS) data to
create business intelligence resulting in highly
accurate sales forecast by product and store.
• Data mining uses existing data sets to create
___________, which are then applied to new data
sets.
• Types of data mining analysis:
– Cluster analysis: divide data into __________ exclusive
groups that can then be treated differently
– Association detection: degree to which variables are
related (e.g., market basket analysis)
– Statistical analysis: correlations, distributions, statistical
models (e.g., ___________ information for forecasting)