A decision support system (DSS) is an interactive computer system that is easily accessible to, and operated by, people who are not computer specialists who use the DSS to help them plan and make decisions. The use of DSSs is expanding, as recent advances in computer hardware and software allow managers and other designated employees to gain “on-line” or “real-time” access to the database in MIS’s. The widespread use of microcomputers has enabled managers to create their own database and electronically manipulate information as needed rather than waiting for reports to be issued by the EDP / MIS department. While MIS reports are still necessary for monitoring ongoing operations, DSS permits less structured use of database as special decision needs arise. An academic dean might use a DSS system to analyze grade trends in certain courses, without needing to commission a formal study of the matter by the registrar’s office.
Differing information for different management levels:
An organization’s information system must provide information to managers with three levels of responsibilities: operational control, management control, and strategic planning. We can think of these three categories in terms of the activities that take place at first line, middle, and top levels of the managerial hierarchy. The design of the MIS must take into account the information needs of the various managerial levels, as well as the routine transaction processing needs of the total organization. For example, the information sources for operational control are found largely within the organization, while the information sources for strategic planning tend to be outside the organization.
Operational Control: An MIS for operational control must provide highly accurate and detailed information on a daily or weekly basis. A production supervisor must know if materials waste is excessive, if costly overruns are about to occur, or if the machine time for a job has expired. The MIS must provide a high volume of timely and detailed information derived from daily operations. The college Food Service manager must track daily usage of certain staples for ordering and cost control purposes.
Middle management: Middle level managers such as division heads, are concerned with the current and future performance of their units. They therefore need information on important matters that will affect those units – large scale problems with suppliers, abrupt sales declines or increased consumer demand for a particular product line. Thus, the type of information middle level managers require consists of aggregate (summarized) data from within the organizations as well as from sources outside the organizations. An example of what a middle level marketing manager at an airline might need to see is monthly passenger traffic – often called passenger “load factor” information. That information can be presented in comparison to other carriers; load factors.
Top management: For top managers, the MIS must provide information for strategic planning and management control. For strategic planning, the external sources of information on economic conditions, technological developments, the actions of competitors assume paramount importance. Because the supporting data come from outside the organization this information is more difficult to gather and computerize than internal information. The college president and director of admissions, for example, are keenly interested in trends in numbers of high school graduates likely to attend college. Strategic and operational about projected future enrollments. The changing demographics of college enrollments, for example is of ongoing interest. As organizations downsize, increasing numbers of people are going back to school. In general, the shift to the information and knowledge economy has created a great demand for college education for the so called Generation X, the 79 million Americans born after 1964. In addition women, minorities and immigrants are entering colleges and universities in record numbers.
Having external data on sources of information workers helped. Texas Instruments plan its global operations. In the 1980s, unable to find enough software designers in Europe, Texas instruments found that India was training more than it could use. The company established an impressive software programming operation in Bangalore, a city of four million in the south of India. Recognizing a good idea, over 30 companies, including IBM and Motorola, have since set up software programming offices in the area. Thus, competitors’ activities are another important source of information.