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SYSTEMS AND DECISION STRUCTURE
Prof. Marimin, PhDBogor Agricultural University, Bogor,
Indonesia
E-mail: [email protected]
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Note : MIS : Management Information SystemDSS : Decision Support SystemSOP : Standard Operation ProcedureMES : Monitoring and Evaluation System
INFORMATION
DECISIONALTERNATIVESDATA
ACTION DECISION
MISNUMBER/TERMS
SOP
DSS
MES
Information Cycle
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What is a System?
ManufacturingProcess
Input of Raw Materials
Output of Finished Products
Environment
Other Systems
Control by
ManagementControlSignals
ControlSignals
FeedbackSignals
FeedbackSignals
System Boundary
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System Definition
Element (E 1) E 2
E 3
E 5E 4
SubGoal
Goal
System Philosophy
- Goal Oriented (Cybernetic) C S- Holistic Not Partial H
- Effectiveness Not Efficiency E
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System Definition
System is a set of an order inter-related elements (components) forachieving the goal/sub-goals.
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System Classification Matrix
System Input Process Output
Analysis
Synthesis
? Narrow aspect
? Wide aspect
Design ?
Control ?
Marketing system is a system.? Production operation system is a system ? Financial system is a system .. ?
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Basic System Structure
Open System
I ( I )Process (P)
Output (O)
Feed Back System
IP
O
Co ntrol
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Directive
Strateg ic
Tactic
Operational
ES
DBMS
IS
EIS
MIS
Information system application in business
DSS
EDP
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Computer Based Information Systems-CBIS
ES : Expert System
DSS : Decision Support Systems
MIS : Management Information System
DBMS : Data Based Management Systems
EDP : Electronic Data Processing
IS : Information Systems
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DSS Definition
DSS is an interactive flexible and adaptable softwarethat utilizes decision rules, models and model base
coupled with a comprehensive database and the
decision makers own insight, leading to specific,
implement able decision in solving problems that
would not be amenable to management science
optimization model.
DSS Supports complex decision making and
increase their effectiveness (Turban&Aronson, 2003)
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Decision Problem
Decision makers usually face situation which havecharacteristics: unique, uncertain, complex, variable terms(long, medium, short), and multi-level structures.
Hierarchy and characteristic of Decision Problems:
Decision Analysis
Directive
Strategic
Tactic
Operasition
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HappySad
Uncertain
Complex Dynamic
Competition
Limited
Choice
Infor.
Preference
Intuition
Illogical
Decision Result
Intelligence
Perception
Philosophic
Wonder Thinking Feel un-comport Action Blameprzce
ENVIRONMENT
REACTION
Fig. Flow of intuitive decision making
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Uncertain Complex
Dynamic Competition Limited
Choice
Infor.
Preference
Decision Result
Intelligence
Preference
Philosophic
Wonder Thinking Un-comport
Action Prize
Blame
Environment
REACTION
Fig. Flow of rational decision making
Alternatives
Possibilities
Model Structure. Evaluation Time
preference Risk Preference
Logical
Happy
Sad
Normative Decision Analysis
Information
Sensitivity
Inner looking
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Most Decision Problems are Multi criteria(MCDM:Multi criteria decision Making)
Maximize profits Satisfy customer demands
Maximize employee satisfaction Satisfy shareholders Minimize costs of production Satisfy government regulations Minimize taxes Maximize bonuses
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Multiple Criteria Decision Making(MCDM) Structure
Objective to be AchievedProblems to be solved
AlternativesTools/Plan/
DecisionMaker
PerformanceCriteria
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Alternative
Criteria/Factors
Weight of Criteria
Evaluation Model
Computation ModelDecision Makers Types
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A set of option which we either wish to prioritize
and/or from which you wish to choose a best one
with respect to a specified set of criteria.
Examples:
. Choosing best product:
. Choosing best supplier:
. Choosing best industrial location:
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Factors on which we base our decision what we
think is important to consider when making an
informed choice.
Examples:
. Criteria for choosing product:
. Criteria for choosing supplier:
. Criteria for choosing industrial location:
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The value we assign to a given criterion with respect
to a parent criterion. The value can be range to 0.0-1.0
or lies within range of the scale of the parent criteria.
Examples:
. Set of weight of 3 criteria : C1= 0.3; C2=0.5; C3= 0.2
. Set of weight of 3 criteria : C1= 3; C2=5; C3= 2
(3 = moderate; 5= very important = less important;
4 = ? ; 1 = ?)
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Alternative Criteria Value of alternative
# of audiences Effectiveness
Cost Method-1 Method-2
1. Radio
2. Television
3. News paper
Weight
Method-1
Method-2
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Payoff Table
States Of NatureDecision a b
(alternative)1 Payoff 1a Payoff 1b
2 Payoff 2a Payoff 2b