CHAPTER 4

Types of Decision Support System

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Introduction
Decision Support Systems (DSS) are a class of computerized information system that support
decision-making activities.
DSS are interactive computer-based systems and subsystems intended to help decision makers
use communications technologies, data, documents, knowledge and/or models to complete
decision process tasks.
A decision support system may present information graphically and may include an expert
system or artificial intelligence (AI). It may be aimed at business executives or some other group
of knowledge workers.
Typical information that a decision support application might gather and present would be, (a)
Accessing all information assets, including legacy and relational data sources; (b) Comparative
data figures; (c) Projected figures based on new data or assumptions; (d) Consequences of
different decision alternatives, given past experience in a specific context.

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There are several Decision Support Systems. These can be categorized into five types:

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Cont..
Communication-driven DSS
Most communications-driven DSSs are targeted at internal teams, including partners. Its purpose
is to help conduct a meeting, or for users to collaborate.
The most common technology used to deploy the DSS is a web or client-server. Examples:
chats and instant messaging software, online collaboration, and net-meeting systems.
Data-driven DSS
Most data-driven DSSs are targeted at managers, staff, and also product/service suppliers. It is
used to query a database or data warehouse to seek specific answers for specific purposes.
It is deployed via a mainframe system, client/server link, or via the web.
 Examples: computer-based databases that have a query system to check (including the
incorporation of data to add value to existing databases.

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Cont..
Document-driven DSS
Document-driven DSSs are more common, and targeted at a broad base of user groups.
 The purpose of such a DSS is to search web pages and find documents using a specific set of
keywords or search terms.
The usual technology used to set up such DSSs are via the web or a client/server system.
Knowledge-driven DSS
Knowledge-driven DSSs or 'knowledgebase' are they are known, are a catch-all category
covering a broad range of systems covering users within the organization setting it up, but may
also include others interacting with the organization.

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Cont..
Model-driven DSS
Model-driven DSSs are complex systems that help analyze decisions or choose between
different options.
These are used by managers and staff members of a business, or people who interact with the
organization, for several purposes depending on how the model is set up - scheduling, decision
analyses etc.
These DSSs can be deployed via software/hardware in stand-alone PCs, client/server systems,
or the web.

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Hierarchy of Decision Support Systems (DSS
The hierarchy of Decision Support Systems (DSS) can be understood as a way of classifying
DSS based on the scope of their usage, complexity, and the level of decision-making they
support.
This hierarchy ranges from simple personal systems used by individuals to complex systems
that span entire organizations and even multiple organizations.

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Personal DSS (PDSS)
Scope: Used by individuals to support personal decision-making.
Complexity: Low; typically supports simple and well-defined problems.
Users: Single users, such as managers or analysts, working independently.
Examples:
 Spreadsheet applications like Excel for budgeting or forecasting.
 Personal financial planning tools.
 Simple decision trees or analysis models.

Purpose: To enhance the individual's ability to make decisions by providing

data, models, or analytical tools.

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Group DSS (GDSS)
Scope: Supports decision-making for groups or teams.
Complexity: Moderate; involves coordination between multiple people with
varying opinions and expertise.
Users: Groups of decision-makers, often in collaborative settings like meetings
or brainstorming sessions.
Examples:
 Electronic meeting systems that allow for voting or consensus-building.
 Group brainstorming tools or interactive whiteboards.
 Video conferencing platforms integrated with decision support features.

Purpose: To help facilitate collaborative decision-making by providing tools

for communication, collaboration, voting, and consensus-building.
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Organizational DSS (ODSS)
Scope: Provides support for decision-making at the organizational level, integrating
data from various departments.
Complexity: High; involves large-scale systems and integrates data from multiple
sources within the organization.
Users: Managers and decision-makers across different departments or functional areas.
Examples:
 Enterprise Resource Planning (ERP) systems, which support operational and strategic decisions by
providing data integration across the entire company.
 Decision dashboards that provide an overview of key performance indicators (KPIs) across
departments.
Purpose: To align organizational processes and strategies with data-driven insights,
supporting both tactical and strategic decision-making

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Inter-organizational DSS (IDSS)
Scope: Supports decision-making across multiple organizations, often in a networked
or supply-chain context.
Complexity: Very high; requires coordination and collaboration between separate
organizations, possibly across different geographic locations or industries.
Users: Decision-makers from different organizations, typically in partnerships or
supply chain management.
Examples:
 Supply chain management systems that integrate data across multiple companies to optimize
production, logistics, and distribution.
 E-commerce platforms where data is shared between suppliers, manufacturers, and retailers for
decision-making on inventory, pricing, and demand forecasting.
Purpose: To facilitate cooperative decision-making between organizations by sharing
data and resources, often to optimize supply chains, partnerships, or strategic alliances.
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Matching DSS to the Decision Types
Decisions can be classified into three main categories, each requiring a different type of DSS:
A. Structured Decisions
Structured decisions are routine, repetitive, and well-defined. These decisions have clear
procedures, rules, and outcomes.
•Example: Reordering inventory when stock levels fall below a predefined threshold.
•Best DSS Type:
• Data-Driven DSS: These systems rely on data and predefined rules to automate routine decisions.
• Example: Transaction processing systems (TPS) or Online Analytical Processing (OLAP) systems.

•Why?: Data-driven DSS handles structured data effectively, providing predefined solutions
based on the input.

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Cont..
B. Semi-Structured Decisions
Semi-structured decisions involve some structured components but require human judgment for
aspects that are ambiguous or uncertain.
Example: Deciding on a marketing campaign where historical data provides insights, but
creativity and intuition are also required.
Best DSS Type:
 Model-Driven DSS or Knowledge-Driven DSS: These DSS types use models or expert systems to
help analyze possible solutions based on a mix of data and rules, but they leave room for decision-
makers to apply their judgment.
 Example: What-if analysis tools or forecasting systems.

Why: These systems provide models and analysis tools that help decision-makers explore
various scenarios, combining structured data with flexibility for intuitive judgment.

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Cont..
C. Unstructured Decisions
Unstructured decisions are complex and lack a clear path to a solution. They involve uncertainty
and may require creative solutions.
Example: Long-term strategic planning for entering a new market or launching a new product.
Best DSS Type:
 Document-Driven DSS, Model-Driven DSS, or Communication-Driven DSS: These systems
allow for the analysis of qualitative data, collaboration, and the use of models to explore different
potential outcomes.
 Example: Executive dashboards, simulation tools, or decision conferencing tools.

Why: Unstructured decisions require tools that enable exploration of diverse data sources
(documents, expert opinions, simulations) and collaboration among decision-makers.

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Matching DSS to the Decision Maker’s Psychological Type
Decision-makers have varying psychological preferences, which can impact the type of DSS
they find most helpful.
The psychological type often relates to how people process information and make decisions.
Here's how to align DSS with some common decision-maker profiles:
A. Intuitive Thinkers
These decision-makers rely on intuition, focusing on big-picture thinking rather than details.
They prefer flexibility and are comfortable with ambiguity.
Best DSS Type:
 Model-Driven DSS or Hybrid DSS: These systems offer tools that allow for scenario planning and
flexible analysis, helping intuitive thinkers explore various possibilities.
 Example: Simulation models that project different outcomes based on varying assumptions.

Why: Intuitive thinkers appreciate DSS tools that allow for open-ended exploration and support
their non-linear thinking process.
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Cont..
B. Analytical Thinkers
Analytical decision-makers prefer a structured approach to decision-making, relying on detailed
data and logic.
They are data-oriented and prefer tools that provide clear, rational insights.
Best DSS Type:
 Data-Driven DSS or Knowledge-Driven DSS: These systems provide quantitative data and
structured problem-solving, which aligns well with the analytical mindset.
 Example: OLAP systems or expert systems that process large amounts of data to present logical
outcomes.
Why: Analytical thinkers prefer systems that present data in a clear, structured format, enabling
them to make decisions based on evidence and logic.

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Cont..
C. Directive Decision-Makers
Directive decision-makers focus on efficiency and quick resolution. They prefer structured
environments and clear, straightforward decision paths.
Best DSS Type:
 Knowledge-Driven DSS or Rule-Based DSS: These systems provide predefined solutions or advice,
which allows for quick decision-making based on established rules or expert knowledge.
 Example: Expert systems that give definitive recommendations.

Why: Directive decision-makers benefit from DSS which guides them through decisions
quickly, with minimal need for complex analysis or exploration.

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Cont..
D. Behavioral Decision-Makers
Behavioral decision-makers value input from others and prefer collaborative environments.
They are often concerned with how decisions impact people and seek consensus.
Best DSS Type:
 Communication-Driven DSS or Group DSS: These systems facilitate communication,
collaboration, and consensus-building among decision-makers.
 Example: Groupware tools that support brainstorming sessions or decision conferencing.

Why: Behavioral decision-makers need DSS that encourage collaboration, enabling them to
gather input from others and ensure that decisions are made collectively.

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Matching Benefits to the DSS User Community
Different users interact with DSS at different levels of decision-making, requiring tailored
functionalities to maximize effectiveness and efficiency.
1. Operational Users (Tactical Level)
Operational users are typically involved in day-to-day, repetitive decision-making tasks. They
require quick, efficient, and precise decision support for routine operations.
Characteristics:
Focus on short-term, operational decisions.
Need real-time data and actionable insights.
Often work in departments like logistics, production, or customer service.

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Cont..
DSS Benefits:
Speed and Efficiency: Data-driven DSS offers real-time, automated solutions for operational
decision-making, such as inventory management or scheduling.
Accuracy: Transactional systems like ERP (Enterprise Resource Planning) provide accurate
data, which helps ensure efficient resource allocation.
Automation: Operational DSS can automate repetitive tasks, reducing manual workload and
human error.
Examples:
Inventory management systems that automate reordering based on stock levels.
Production scheduling tools that optimize resource use.

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Cont..
2. Tactical Users (Middle Management)
Tactical users are involved in medium-term planning and decisions that affect the organization's
performance over months or quarters. They balance operational needs with strategic goals.
Characteristics:
Deal with semi-structured decisions, such as budget allocation, project management, and
marketing campaigns.
Need systems that support what-if analysis and scenario planning.

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Cont..
DSS Benefits:
Scenario Analysis: Model-Driven DSS allows middle managers to run simulations and what-if
scenarios, helping them weigh various options and outcomes.
Data Integration: DSS tools provide integrated views across multiple departments, helping
with resource allocation, cost management, and performance tracking.
Decision Modeling: Tactical users benefit from models that help forecast outcomes based on
different strategies, such as financial models or market analysis tools.
Examples:
What-if analysis tools for budget forecasting.
Marketing analytics systems to test different campaign scenarios and target groups.

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Cont..
3. Strategic Users (Top Management / Executives)
Strategic users are responsible for long-term decisions that shape the overall direction of the
organization.
These decisions are often unstructured, requiring systems that can synthesize vast amounts of
data and provide insights into trends and future projections.
Characteristics:
Focus on long-term, unstructured decisions.
Need tools for synthesizing complex, unstructured data and providing high-level insights.
Interested in competitive positioning, market trends, and company strategy.

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Cont..
DSS Benefits:
Trend and Forecast Analysis: Strategic DSS, such as Executive Information Systems (EIS), help
executives identify long-term trends and forecast market developments, assisting in high-level planning.
Dashboard Integration: DSS provides key performance indicators (KPIs) and executive dashboards
that aggregate data from different departments, giving a holistic view of the organization’s health.
Strategic Simulations: Model-driven systems can project long-term outcomes of strategic initiatives,
helping executives evaluate the impact of entering new markets, launching new products, or acquiring
companies.
Examples:
Executive dashboards that visualize financial metrics, sales trends, and market data.
Strategic forecasting tools to predict industry trends or economic changes.

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Cont..
4. Group and Collaborative Users (Teams and Cross-Departmental Groups)
Teams that need to collaborate across functions or geographies often use Group Decision
Support Systems (GDSS) to make joint decisions.
 These users are interested in communication, collaboration, and consensus-building.
Characteristics:
Focus on group-based, collaborative decision-making.
Require tools that facilitate communication, voting, and decision tracking.

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Cont..
DSS Benefits:
Enhanced Communication: Communication-Driven DSS supports group decision-making by
providing tools like shared workspaces, voting systems, and discussion forums.
Consensus Building: GDSS includes voting mechanisms and decision-tracking features to
ensure that group consensus is reached efficiently.
Collaboration Tools: Systems like groupware or decision conferencing platforms facilitate the
exchange of ideas and opinions, making group decision-making more structured and efficient.
Examples:
Group decision-making platforms with real-time chat, voting tools, and whiteboards.
Collaboration software that allows cross-functional teams to make collective decisions on
projects.

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Cont..
5. Knowledge Workers and Experts (R&D, Consultants, Specialists)
Knowledge workers, such as researchers, consultants, or specialized staff, require systems that
provide advanced, expert-level advice or recommendations based on large datasets or specialized
knowledge bases.
Characteristics:
Deal with complex, often non-routine decisions that require expert input.
Require deep, specialized insights, often relying on knowledge bases or expert systems.

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Cont..
DSS Benefits:
Expert Advice: Knowledge-Driven DSS can provide specialized recommendations, such as
diagnostics systems in healthcare or legal advisory systems.
Problem-Solving: Expert systems mimic human experts and are used to solve complex
problems by applying a rule-based approach.
Advanced Analytics: Systems provide advanced data analysis, simulations, and algorithms that
support problem-solving in complex fields like engineering or medicine.
Examples:
Expert systems used in medical diagnosis, legal reasoning, or technical consulting.
Research DSS for analyzing large scientific datasets.

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Cont..
6. IT and Data Science Teams (DSS Developers and Maintainers)
These teams are responsible for maintaining and developing the DSS, ensuring that it is aligned
with the organization's needs, and that the system functions efficiently.
Characteristics:
Manage the design, development, and maintenance of DSS.
Focus on the technical aspects of data integration, system performance, and user support.

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Cont..
DSS Benefits:
System Customization: The ability to tailor DSS features to meet specific organizational or
departmental needs.
Data Integration: Ensures that data from different sources is harmonized and that the DSS
operates on up-to-date, accurate data.
User Support: IT teams benefit from tools that monitor system performance, security, and user
activity to ensure the DSS runs smoothly and effectively.
Examples:
Tools for monitoring system health and managing data security.
Interfaces that allow IT teams to customize DSS models, reports, and dashboards.

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 Summary of DSS Benefits by User Type
User Type Decision Focus Best DSS Benefits

Operational Users Short-term, structured Speed, efficiency, and accuracy through automation and
real-time data.
Tactical Users Medium-term, semi-structured Scenario analysis, data integration, and decision modeling.

Strategic Users Long-term, unstructured Trend analysis, forecasting, strategic simulations, and
executive dashboards.
Group/Collaborative Group-based decisions Enhanced communication, collaboration tools, and
Users consensus-building features.
Knowledge Workers Complex, expert-level Expert advice, problem-solving systems, and advanced
data analytics.
IT/Data Science Teams DSS development/maintenance Customization, data integration, system monitoring, and
user support tools.

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Usage Models of Decision Support Systems (DSS)
A usage model in the context of Decision Support Systems (DSS) refers to how the system is
applied in different decision-making contexts, from routine operational decisions to strategic
long-term planning.
 Understanding the usage models helps to ensure that the DSS is properly aligned with the needs
of various users and decision types, optimizing the system’s effectiveness.
Institutional Usage Model
Institutional DSS refers to systems that are integrated into the organizational workflow and are
used consistently across departments or functions.
These systems are long-term, central to the organization’s decision-making processes, and often
handle both structured and unstructured decisions at various levels of the organization.

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Cont..
Key Features:
Enterprise-Wide Implementation: Institutional DSS is typically part of larger systems like
Enterprise Resource Planning (ERP) or Business Intelligence (BI) platforms. They integrate
across departments and are aligned with the organization's strategic goals.
Structured and Unstructured Decisions: These systems support a wide range of decisions, from
operational to strategic, by providing data analysis, forecasting, and scenario modeling.
Long-Term Use: Institutional DSS is embedded within the organization for continuous use,
supporting decisions over the long term.
Example:
ERP Systems: These systems integrate data across finance, HR, supply chain, and other
departments, enabling decision-making across multiple functional areas.
Business Intelligence Systems: Tools like Microsoft Power BI or SAP BI aggregate
organizational data to provide key insights into performance and future trends.
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Cont..
Usage Model:
Operational Level: Daily decision support for routine tasks (inventory management,
scheduling).
Tactical Level: Middle management uses it for resource allocation, budgeting, and project
management.
Strategic Level: Executives use it for strategic planning, forecasting, and long-term decision-
making.

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Cont..
Ad Hoc Usage Model
Ad Hoc DSS refers to systems used on a temporary, as-needed basis.
These systems are not always part of the organization’s core infrastructure and are often deployed
to handle specific, often unstructured decisions.
The primary focus is on solving a one-time problem or supporting short-term decision-making.
Key Features:
Short-Term Use: Designed for specific, temporary decision-making needs. They are not part of
the regular workflow but are used to address a particular issue or decision.
Flexibility: Ad hoc DSS can be quickly implemented and customized to handle the decision at
hand, such as creating custom reports or running specific simulations.
Decision-Specific: The DSS is configured to meet the needs of the specific decision-maker or
project.
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Cont..
Example:
Custom Analytical Models: A custom decision model used by a marketing team to evaluate the
effectiveness of a campaign based on data from a specific time period.
One-Time Data Integration Tools: Tools that pull data from various sources to answer a
unique business question or assess a specific scenario.
Usage Model:
Problem-Specific: These systems are used for unique, unstructured decisions that require
custom solutions.
Short-Term Projects: Ad hoc DSS is frequently used in projects with a defined start and end
date, such as launching a new product or exploring a market entry strategy.

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Cont..
Interactive Usage Model
An Interactive DSS involves continuous interaction between the decision-maker and the system,
allowing the user to explore different options, perform simulations, and receive immediate feedback on
their decisions.
This model supports both structured and semi-structured decisions, providing flexibility and
customization based on user input.
Key Features:
User Engagement: The decision-maker interacts with the system in real-time, often performing
“what-if” analysis or simulations.
Immediate Feedback: Interactive DSS provides immediate responses based on changes to input data,
allowing decision-makers to experiment with different scenarios.
Customizable: These systems are highly customizable, enabling users to modify parameters and
assumptions to explore the impact of various decision paths.

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Cont..
Example:
What-If Analysis Tools: Tools that allow financial analysts to explore the impact of different
investment or budgeting strategies.
Simulation Systems: Systems that simulate the outcome of various business strategies, such as
changes in pricing or market conditions, in real-time.
Usage Model:
Decision Exploration: Used for semi-structured decisions where the decision-maker needs to
evaluate multiple options.
Flexibility in Decision-Making: The decision-maker can test multiple hypotheses or scenarios
before making a final decision.

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Cont..
Communication-Driven Usage Model
A Communication-Driven DSS is used in situations where collaboration and communication
between multiple decision-makers are critical.
This model is often applied in group decision-making contexts, where input from various
stakeholders or team members is required to reach a consensus or make a well-informed decision.
Key Features:
Collaboration-Focused: Enables communication, sharing of data, and collaborative decision-
making among a group of people.
Tools for Consensus Building: May include tools such as voting systems, group chat, decision
tracking, and brainstorming tools.
Group Interaction: Encourages teamwork and shared responsibility for decisions, often in real-
time or asynchronous environments.
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Cont..
Example:
Group Decision Support Systems (GDSS): Systems like video conferencing tools with
collaborative features (e.g., Google Meet or Microsoft Teams) that allow group discussions and
decision-making.
Electronic Meeting Systems: Tools used to facilitate group meetings, where participants can
share data, vote, and discuss options.
Usage Model:
Group Decision-Making: Teams use these systems during meetings, brainstorming sessions, or
when consensus is required on a particular issue.
Collaboration Across Departments: Often used in cross-departmental projects where multiple
stakeholders need to contribute to the decision.

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Cont..
Data-Driven Usage Model
A Data-Driven DSS focuses primarily on accessing, processing, and analyzing large datasets to
support decision-making.
These systems rely on databases, data warehouses, or big data tools to retrieve and analyze
historical and real-time data, often supporting operational and tactical decisions.
Key Features:
Data-Centric: The primary function of the system is to gather and process data from various
sources to inform decisions.
Real-Time or Historical Data: Provides access to real-time data or historical records, allowing
decision-makers to base their decisions on factual data.
Automated Data Analysis: Includes automated tools for generating reports, identifying trends,
and performing statistical analysis.
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Cont..
Example:
Online Analytical Processing (OLAP): Tools that provide multidimensional analysis of
business data, helping decision-makers identify patterns and trends.
Business Intelligence Systems: Data visualization tools like Tableau or Power BI that generate
reports based on business data for decision-makers.
Usage Model:
Routine Operational Decisions: Used for structured decision-making in operations where data
analysis is required (e.g., inventory control, sales forecasting).
Data-Driven Insights: Helps managers make data-backed decisions by offering real-time data
insights and trend analysis.

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Cont..
Knowledge-Driven Usage Model
A Knowledge-Driven DSS provides decision-makers with expert knowledge and
recommendations, often by using rule-based systems, artificial intelligence (AI), or machine learning
(ML) algorithms.
 This model is used for complex decision-making processes that require deep insights or specialized
expertise.
Key Features:
Expert System Capabilities: Uses AI or expert systems to simulate human expert decision-making
processes.
Rule-Based Systems: Provides solutions based on a predefined set of rules or heuristics that mimic
expert reasoning.
Intelligent Recommendations: These systems offer suggestions, diagnoses, or decisions based on
past experiences, patterns, and data.
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Cont..
Example:
Medical Diagnosis Systems: AI-based DSS that assist doctors in diagnosing diseases by
analyzing symptoms and medical records.
Legal Expert Systems: Tools that provide legal professionals with recommendations on case
strategies based on precedents and legal rules.
Usage Model:
Complex Problem-Solving: Used in complex, non-routine decisions that require specialized
knowledge, such as in healthcare, law, or engineering.
Expert Recommendations: Provides decision-makers with expert-level advice based on data
and predefined rules.

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 Summary of Usage Models
Key Features Examples Primary Usage Contex
Usage Model

Institutional DSS Long-term, enterprise-wide integration ERP systems, Business Operational, tactical, and strategic
Intelligence (BI) tools use

Ad Hoc DSS Short-term, problem-specific, flexible Custom analytical tools, one- Temporary, specific decisions
time data integration

Interactive DSS Real-time interaction and feedback What-if analysis tools, Semi-structured decision exploration
simulation systems

Communication-Driven Collaboration, group decision-making Groupware, GDSS, video Group and cross-departmental
DSS conferencing with decision tools decisions

Data-Driven DSS Data-centric, automated data analysis OLAP, BI dashboards, reporting Routine operational and tactical
tools decisions

Knowledge-Driven DSS Expert systems, rule-based AI-based diagnostic systems, Complex, expert-level decision-
recommendations legal expert systems making

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 Thank You !!!! For Your
Attention and Commitment !!

If any!!

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