What are Decision Support Systems? Explain Its Components

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Introduction
In the 1960s, there was a very wide use of the various forms of the information systems but as the time passed and with the coming up of the 1970s, instead of these information systems – a special type of the information systems, quite different from then used information systems came into the limelight. These were very much different from the then used information systems and mainly involved spending less resources, including both of the human as well as the financial.

These new information systems were very much interactive in the nature compared to the earlier used information systems and also played a very critical role in some of the specific enduser utilization of the data and the models in order to discuss and divide – not solve – semi structured and the unstructured problems. These systems at that point of the time were also referred to as the decision support systems.

The decision support systems can be defined as the interactive information systems, which are very much dependent on the integrated set of the user friendly hardware and the software tools, mainly in order to produce the information and then to present the information that is mainly targeted for providing the much needed support to the management in the process of the decision making. The decision support systems play a very defining role in the management decision making with the help of the combination of the data, sophisticated analytical models and the user friendly software into a single powerful system. With the help of this combination, semi structured and the unstructured decision making can be very easily supported to a great extent.

The decision support systems are always under the control of the user, starting from the early inception to the final implementation and the daily use. The decision support systems also have a great role in the closing of the information gap that helps the managers in making the improvement in the quality of their decisions.

The decision support systems involves a particular class of the systems which are used for providing the much needed support to the process of the decision making, but a very important point to be kept in mind here is that the decision support systems does not always give a decision itself.
With the help of the decision support systems the various decisions can be validated with the help of the sensitivity analysis conduction on the different parameters of the problem.

Components of the Decision Support Systems
1. The data base:
a. Is a collection of the current or the historical data from a number of the applications or the groups.
b. Very well organized.
c. Provides very easy access for a large variety of the applications needed.
d. Data integrity is to be maintained in a very efficient way.
e. Decision Support System uses data that have been extracted from the relevant databases – both the internal and the external – and then stored especially for the Decision Support System.

2. The Model – base:
a. A model represents an abstract representation.
b. Illustrates the different components or the relationships of a phenomenon.
c. Can be a physical model, a mathematical model or the verbal model.
d. Types of the models can be categorized as the follows –

A. Behavioral Model –
I. Focuses on studying and understanding the different behavior/trends amongst the variables.
II. Examples of such a model can be trend analysis, co-relation, regression etc.

B. Management Science Model –
I. Based upon the principles of the management, the management accounting and the econometrics.
II. Examples of such a model can include budgetary systems, cost accounting, capital budgeting, inventory management etc.

C. Operations Research Model –
I. Based on the different mathematical formulae.
II. Represent the real life problems depending on the various variables and the parameters expressed in the algebraic equations form.
III. Examples of such a model can be linear programming, ABC analysis, mathematical programming techniques, material requirement planning.

3. The Decision Support System software system –
a. Allows interaction between the users of the system and the Decision Support System data – base and the model – base.
b. Helps in the creation, storage and the retrieval of the models in the model – base.
c. Integrates them with the data in the Decision Support System data – base.
d. Provides a user interface.

This article has been written by KJ Singh a MBA Graduate from a prestigious Business School In India
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