![arianto.muditomo@2018
TYPE OF BUSINESS INTELLIGENCE
5
Book [3] p.328](https://image.slidesharecdn.com/004-190422035541/85/MU630-004-Business-Intelligence-Decision-Support-6-320.jpg)
![arianto.muditomo@2018
17
Figure 11.15
Conceptual model of
DSS and its
components.
[3] p. 351](https://image.slidesharecdn.com/004-190422035541/85/MU630-004-Business-Intelligence-Decision-Support-18-320.jpg)
![arianto.muditomo@2018
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Figure 11.14
Phases in the decision-
making process.
[3] P. 348
Decision makers go
through four systematic
phases:
• intelligence,
• design,
• choice, and
• implementation](https://image.slidesharecdn.com/004-190422035541/85/MU630-004-Business-Intelligence-Decision-Support-19-320.jpg)
[MU630] 004. Business Intelligence & Decision Support
- 1. © 2018 Arianto Muditomo All Rights Reserved Copyright Notice: This presentation is prepared by Author for Perbanas Institute as a part of Author Lecture Series. It is to be used for educational and non- commercial purposes only and is not to be changed, altered, or used for any commercial endeavor without the express written permission from Author and/or Perbanas Institute. Appropriate legal action may be taken against any person, organization, or entity attempting to misrepresent, charge, or profit from the educational materials contained here. Authors are allowed to use their own articles without seeking permission from any person, organization, or entity.
- 2. arianto.muditomo@2018 Referrences: 1) Baltzan, Paige 2014. Business Driven Information Systems. 4th Edition. New York: McGraw-Hill. 2) Pearlson, Keri E. And Saunders Carol S. 2013. Managing and Using Information Systems: A Strategic Approach. 5th Ed. Danvers: John Wiley & Sons. 3) Turban, Efraim, Volonino, Linda, and Wood, Gregory 2013. Information Technology for Management. 9th Edition. Hoboken: John Wiley & Sons. (Chapter 11) 4) Turban, Efraim, Strauss, Judy, and Lai, Linda 2016. Social Commerce: Marketing and Technology Management. Hidelberg: Springer. 5) Xu, Jun and Quaddus, Mohammed 2013. Managing Information Systems: Ten Essential Topics. Amsterdam: Atlantis Press. 6) Turban, Rainer: Introduction to Information Systems Enablig and Transforming Business 2nd Ed., John Wiley & Sons.2009 7) Kenneth C. Laudon and Jane P. Laudon, Management Information Systems, Managing The Digital Firm, Pearson: Prentice Hall 2006 8) Business information systems : technology, development and management for the e-business / Paul Bocij, Andrew Greasley and Simon Hickie. – Fifth edition., © Pearson Education Limited 2015 1 • Session #1: Information System in Business • Session #2: IT Strategic Planning • Session #3: Business Information System • Session #4: Business Intelligence & Decision Support • Session #5: Ethics, Privacy and Security • Session #6: e-Business and e-Commerce • Session #7: Knowledge Management • Session #8: Enterprise Information System
- 3. arianto.muditomo@2018 2 § Understand organizations’ need for business intelligence (BI), BI technologies, and how to make a business case for BI investments. § Describe BI architecture, data mining, predictive analytics, dashboards, scorecards, and other reporting and visualization tools. § Understand the value of data, text, and Web mining. Understand managerial decision- making processes. § Describe decision support systems (DSSs), benefits, and structure. § Take a forward look at the future of BI in the form of mobile intelligence (MI).
- 4. arianto.muditomo@2018 3 § What is Business Intelligence System? § What is major components of BI? § What is Decision Support System? § What is major components of DSS?
- 5. arianto.muditomo@2018 WHAT IS BUSINESS INTELLIGENCE SYSTEM? 4
- 6. arianto.muditomo@2018 TYPE OF BUSINESS INTELLIGENCE 5 Book [3] p.328
- 7. arianto.muditomo@2018 6 Competing and conflicting versions of the truth Lagging reports Can’t perform in-depth analysis Difficulty finding crucial data Need simple-to-use production reporting technology Delay and difficulty consolidating data Not able to comply with government and regulatory reporting mandates
- 8. arianto.muditomo@2018 7 Credit: Gartner Methodology Source: https://financesonline.com/15-best-business-intelligence-tools-small-big-business/
- 9. arianto.muditomo@2018 8 § Getting information too late § Getting data at the wrong level of detail—either too detailed or too summarized § Getting too many directionless data § Not being able to coordinate with other departments across the enterprise § Not being able to share data in a timely manner
- 10. arianto.muditomo@2018 9 Data W/H; Data Mining; OLAP; Dashboards;WEB, Social Media Search; Data Visualization; Scorecards Components Query; Reporting; Analytics Core Functions • BI capabilities depend on an integration of several ITs, BI incorporates data warehousing, data mining, online analytical processing (OLAP), dashboards, the use of the Web, and, increasingly, social media. • Three core functions of BI are query, reporting, and analytics. Queries are one way to access a particular view of the data or to analyze what is happening or has happened. • Data mining and predictive analytic tools are used to find relationships that are hid- den or not obvious, or to predict what is going to happen. • BI also includes processes and tools to accurately and consistently consolidate data from multiple sources and to ensure data quality.
- 11. arianto.muditomo@2018 BI technology evolved beyond being primarily a reporting system when the following features were added: (1) sophisticated predictive analytics, (2) event-driven (real-time) alerts, and (3) operational decision support. 10 Predictive Analytics Event-Driven Alerts Decision Support is the branch of data mining that focuses on forecasting trends (e.g., regression analysis) and estimating probabilities of future events. are real-time alerts or warnings that are broadcast when a predefined event, or unusual event, occurs.
- 12. arianto.muditomo@2018 11 v Flaw #1. Believing That “IfYou Build It, They Will Come.” v Flaw #2. Being Locked into an “Excel Culture.” v Flaw #3. Ignoring Data Quality and Relevance Issues. v Flaw #4.Treating BI as a Static System. v Flaw #5. Pressing BI Developers to Buy or Build Dashboards Quickly and with a Small Budget. v Flaw #6.Trying to Create a “SingleVersion of the Truth” When One Doesn’t Exist. v Flaw #7. Lack of a BI Strategy.
- 13. arianto.muditomo@2018 12 Customer Segmentation What market segments do my customers fall into and what are their characteristics? Propensity to buy Which customers are most likely to respond to my promotion? Customer profitability What is the lifetime profitability of my customers? Fraud detection How can I detect which transactions are likely to be fraudulent? Customer attrition Which customers are at risk of leaving? Channel optimization What is the best channel to reach my customers in each segment? Personalize customer relationships for higher customer satisfaction and retention. Target customers based on their need to increase their loyalty to your product line. Also, increase campaign profitability by focusing on those most likely to buy. Make business interaction decisions based on the overall profitability of customers or customer segments. Quickly detect fraud and take immediate action to minimize cost. Prevent loss of high-value customers and let go of lower-value customers. Interact with customers based on their preference and your need to manage cost. Analytical App. Business Question Business Value
- 15. arianto.muditomo@2018 § Decision Support Systems (DSS) are a specific class of computerized information system that supports business and organizational decision-making activities . § A properly designed DSS is an interactive software- based system intended to help decision makers compile useful information from raw data, documents, personal knowledge, and/or business models to identify and solve problems and make decisions. 14 Because decision-making involves a complex sequence of activities over time, it implies there are at least three functions that should be assigned to DSSs: 1) The capability of capturing and saving information from previous activities; 2) Data processing capability; 3) Data retrieval capability.
- 17. arianto.muditomo@2018 § Database. A DSS database system, like any database, contains data from multiple sources. Some DSSs do not have a separate database; data are entered into the DSS model as needed (e.g., as soon as they are collected by sensors). § Model Base. A model base contains completed models and sets of rules, which are the building blocks necessary to develop DSS applications.Types of models include financial, statistical, management science, or economic. Model-building software, such as Excel, has built-in mathematical and statistical functions.These models provide the system’s analytical capabilities. § User Interface. The user interface covers all aspects of the communications between a user and the DSS. A well-designed user interface can greatly improve the productivity of the user and reduce errors. § Users. A DSS is a tool for the user, the decision maker.The user is considered to be a part of the highly interactive DSS system. A DSS has two broad classes of users: managers and staff specialists, such as financial analysts, production planners, and market researchers. § Knowledge Base. Many unstructured and semi structured problems are so complex that they require expertise for their solutions. Such expertise can be provided by a knowledge-based system, such as an expert system. 16
- 18. arianto.muditomo@2018 17 Figure 11.15 Conceptual model of DSS and its components. [3] p. 351
- 19. arianto.muditomo@2018 18 Figure 11.14 Phases in the decision- making process. [3] P. 348 Decision makers go through four systematic phases: • intelligence, • design, • choice, and • implementation
- 21. arianto.muditomo@2018 § What is Business Intelligence System? Business Intelligence (BI) refers to technologies, applications and practices for the collection, integration, analysis, and presentation of business information.. Business Intelligence systems are data-driven Decision Support Systems (DSS) § What is major components of BI? The major components of BI are data warehouses and/or marts, predictive analytics, data mining, data visualization soft- ware, and a business performance management system. § What is Decision Support System? A DSS is an approach that can improve the effectiveness of decision making, decrease the need for training, improve management control, facilitate communication, reduce costs, and allow for more objective decision making. § What is major components of DSS? The major components of a DSS are a database and its management, the model base and its management, and the user- friendly interface. 20
- 22. arianto.muditomo@2018 § You can find a good reference from https://blog.marketresearch.com/10-ways-business- intelligence-can-improve-your-organization § Please find a real example how BI can help manager to make decisions 21
- 23. © 2018 Arianto Muditomo All Rights Reserved