Decision Support Systems (DSS)

By Group 2
KSBMS 04 Kabir Agarwal
KSBMS 05 Karan Agarwal
KSBMS 47 Pahel Gangrade
KSBMS 53 Dishi Goel
KSBMS 58 Prisha Gupta
KSBMS 91 Bhairavi Joshi

Evolution

The evolution of Decision Support Systems (DSS) has been driven by advancements in technology, changes in
business needs, and shifts in the way data is collected, processed, and utilized. DSS have transformed from
simple rule-based systems to sophisticated, data-driven platforms that aid in making complex decisions. Here's
an overview of their evolution:

1960s-1970s: Early Rule-Based Systems and Management Information Systems (MIS):

Decision support systems had their roots in the management information systems of the 1960s and 1970s.
Early systems primarily focused on generating predefined reports and providing structured information to
managers.
These systems were rule-based and lacked the ability to handle complex or dynamic scenarios.

1980s-1990s: Model-Driven DSS and Executive Information Systems (EIS):

Model-driven DSS emerged, incorporating mathematical models and algorithms to aid in decision-making.
Executive Information Systems (EIS) were developed to provide top-level executives with summarized and
interactive views of the organization's performance.
Spreadsheets and software tools like Lotus 1-2-3 and Microsoft Excel became popular for creating rudimentary
DSS.

Late 1990s-2000s: Data-Driven DSS and Business Intelligence (BI):

The focus shifted towards data-driven decision support systems, with a growing emphasis on gathering, storing,
and analysing large volumes of data.
Business Intelligence (BI) tools gained prominence, enabling organizations to extract insights from historical
data and create interactive dashboards.
Online Analytical Processing (OLAP) tools allowed for multidimensional analysis of data.

2000s-Present: Advanced Analytics and Big Data DSS:

With the advent of big data technologies, DSS evolved to handle vast amounts of structured and unstructured
data from various sources.
Advanced analytics techniques such as data mining, machine learning, and predictive modeling were integrated
into DSS.
The focus shifted towards real-time decision-making, leveraging streaming data and IoT devices.
Cloud computing and distributed computing technologies enabled scalability and accessibility of DSS.

Present-Future: AI-Powered DSS and Prescriptive Analytics:

Artificial Intelligence (AI) and machine learning are being integrated into DSS to provide more sophisticated
insights and predictions.
Prescriptive analytics aims to not only provide insights and predictions but also recommend optimal courses of
action.
Natural Language Processing (NLP) enables users to interact with DSS using human language queries and
commands.
Personalized and adaptive DSS offer customized recommendations based on user preferences and historical
data.
Characteristics

Performs Complex, Sophisticated Analysis and Comparisons Using Advanced Software Packages -
There are several programs (part of DSS) used by various methods that analyse the raw data.
For example : A market research survey can be analysed by different standalone analytical programs associated
with DSS. It is DSS which then integrates these programs to come up with comparative studies.

Provides Report and Presentation Flexibility -

This information gathered with the help of DSS may be displayed on the computer screen or can be printed
according to the need of the decision makers. Managers get access to different kinds of reports in formats that fit
to their requirement.

Provides Rapid Access to Information -

Continuous and Rapid access of information is offered by DSS.
For example : The metres on the dashboard of a vehicle are used to keep a watch on how the vehicle is running.

Supports Drill-Down Analysis -

DSS helps the manager in going through details of the project by drilling down through data.
For example : When reviewing the total project cost, the manager can easily break it down to estimate the cost
for each phase, activity or task.

Handles Large Amounts of Data from Different Sources -

DSS has the ability to accumulated data from different databases which are stored on different computer
systems or networks. It can also source data from the internet.

Offers both Textual and Graphical Orientation -

DSS can produce information in a wide variety of text and graphics such as plain texts, tables, Pie Charts,
Trends Lines, line drawings etc. All of these provide a better understanding of a situation to managers and help
them to communicate the same to others.

Classification
File Drawer Systems:
This is a system which provide the user with organized information regarding specific demands. This system
provides on-line information.
This is very useful system for decision making.

Data Analysis Systems:

These decision systems are based on comparative analysis and makes use of a formula. The cash flow analysis,
inventory analysis and personnel inventory systems are examples of the analysis systems. This use of simple
data processing tools and business rules are required to develop that system.

Information Analysis System:

In this system the data is analyzed and the information reports are generated. The decision makers use these
reports for assessment of the situation for decision-making. The sales analysis, accounts receivables system,
market research analysis are examples of such systems

Accounting Systems:
These systems are not necessarily required for decision making but they are desirable to keep track of the major
aspects of the business. These systems account items such as cash, inventory, and personnel and so on.

Model Based Systems:

These systems are simulation models or optimization.

Solver Oriented DSS:

It is performing certain computations for solving a particular type of problem. The solver could be economic
order quantity procedure for calculating an optimal ordering quantity.

Suggestion System:
There are used for operational-purposes. They give suggestion to the management for a particular problem. This
model helps in making required collection of data before taking a suitable decision.

Compound DSS:
It is a system that includes two or more of the above five basic structures explained above. It can be built by
using a set of independent DSS, each specializing in one area.

Objectives
1. Support for decision makers in semi structured and unstructured problems.

2. Support managers at all levels.

3. Support individuals and groups.

4. Support for interdependent or sequential decisions.

5. Support intelligence, design, choice, and implementation.

6. Support variety of decision processes and styles.

Components
According to Management Study HQ, decision support systems consist of three key components: the database,
software system, and user interface.

DSS database:
The database draws on a variety of sources, including data internal to the organization, data generated by
applications, and external data purchased from third parties or mined from the Internet. The size of the DSS
database will vary based on need, from a small, standalone system to a large data warehouse.

DSS software system:

The software system is built on a model (including decision context and user criteria). The number and types of
models depend on the purpose of the DSS. Commonly used models include:

Statistical models:
These models are used to establish relationships between events and factors related to that event. For example,
they could be used to analyze sales in relation to location or weather.

Sensitivity analysis models:

These models are used for “what-if” analysis.

Optimization analysis models:

These models are used to find the optimum value for a target variable in relation to other variables.

Forecasting models:
These include regression models, time series analysis, and other models used to analyze business conditions and
make plans.

Backward analysis sensitivity models:

Sometimes called goal-seeking analysis, these models set a target value for a particular variable and then
determine the values other variables need to hit to meet that target value.
DSS user interface:
Dashboards and other user interfaces that allow users to interact with and view results.

Application
A Decision Support System has numerous applications. There are so many day to day activities that are done
with the help of DSS. The best example of it is- GPS. Apart from it you can see your computer usage. Whenever
you open a browser and use the search engine you have used DSS.
Some prominent business related applications of a Decision Support System are given below:

Agriculture
Agriculture is one of the areas in which DSS is used. It might sound impossible but there are many farmers that
use DSS to understand the crop yield and the best time for plantations. It helps farmers to minimize their losses
due to unplanned crop planting or loss of crops due to storms.

Education
Education industry is very big. Colleges, schools and industries have implemented the DSS to keep a tab on the
students enrolled.
It also helps the colleges and universities to predict how many students will enroll next year in a particular
program. It will also help to estimate if the seats are sufficient or the students are sufficient for the program and
costs.

Real Estate
For real estate comparing the prices of homes is important as customers will buy the property after comparing
the prices only. With DSS, comparisons can be done.

Weather Forecasting
You must have seen news channels and apps that show weather predictions. All hazards, floods, earthquakes or
any kind of potential disasters can be predicted using the DSS based on data analysis. All the historical data,
past trends about disasters and potential damage can be determined.

Medicine
In medicine, using a DSS is called clinical DSS. In the field of medicine, we can do research work, preventive
analysis and other follow up issues. Medicine related orders can also be determined using DSS. So, DSS is very
useful in the medicine industry as well.

Also Read | How Business Analytics impacts Decision Making in Businesses

The Decision Support System has gained more popularity now than in earlier times. Now different sectors have
implemented a DSS like military, defense, hospitals, security, manufacturing and even medicine.

Everyone understands the importance of decision making in different situations. Therefore, companies are
implementing a DSS based on their use. All the human deficiencies can be removed and covered using a
computerized system.

AI based systems can easily cater to the needs of managers and top level executives and give them a prediction
and a blueprint about what the future course of action should be. But the ultimate decision making lies with the
humans only. Machines and softwares can only assist you.