Week 3 - Strategic Decision Making

1. Define TPS & DSS, provide some examples of these systems in business

TPS or Transaction Process Systems record every transaction as they are transaction oriented. The transaction processing systems involve simple business activities including, sales, cash deposits, receipts etc. TPS is not specific to a single area in business, but rather they manage all business function area activities and are important to the operation of a business.

DSS or decision support systems ‘assist decision making to more complex problems, so called un-structured or semi structured problems.’ The decision support system allows for business to estimate the future cash flow into their business from the use of long term assets. DSS will also help businesses when they are preparing a budget for their operations for a future amount of time.

TPS & DSS Systems. Source: http://www.svtuition.org/2010/12/typology-of-mis.html

2. Describe the three quantitative models typically used by decision support systems.

DSS is used in three quantitative models, including the sensitivity analysis, the what-if analysis, and the goal-seeking analysis. The sensitivity analysis involves the ‘study of the impact that changes in one (or more) parts of the model have on other parts of the model’. The what-if analysis involves the checking ‘of the impact of a change in an assumption on the proposed solution.’ And finally the last quantitative model is the goal-seeking analysis which ‘finds the inputs necessary to achieve a goal.’

3. Describe a business processes and their importance to an organisation, outline an example of how they are used.

Business Processes ‘refer to the manner in which work is organised, coordinated and focussed to produce a valuable product or service.’  A business process is simply a set of steps in order to achieve an outcome in an organisation.  An example of a business process being used is Columbia Sportswear. The company wanted a’ new way to streamline its operations to get up to date information to employees working across multiple time zones. Columbia Sportswear deployed innovative Microsoft messaging software to give its workers flexible, safeguarded access to messages from anywhere in the world. This helps the company to speed up every aspect of its business, and gives employees more freedom to enjoy and active lifestyle.’ (Baltzan et al 2010) This allows Columbia Sportswear to have an organised workforce to produce a valuable product to the community through a successful and important business process.

4. Compare business process improvement and business process re-engineering.

Business process improvement is used as a continuous improvement model. ‘It requires a broad view of both information technology and business activity and of the relationships between them.

Business Process Improvement model. Source: http://www.outbrain.jp/en/service.html

Business process re-engineering makes the assumption that the process is broken. The main concern of business process re-engineering is with the improvement of the experience for the business and will often set new standards within the industry.

Business Process re-engineering. Source: http://www.outbrain.jp/en/service.html

5. Describe the importance of business process modelling (or mapping) and business process models.

Business process modelling is important because it helps a business to perform the necessary tasks of mapping out each of its processes. By visualizing a business’s operations, the business if often able to identify any problems and any opportunities that may arise. Business process modelling will involve making a ‘flowchart or process map’ of the work processes in a business.

Business process models are ‘a graphic description of a process, showing the sequence of process tasks, which is developed for a specific purpose and from a selected viewpoint.  It is important for business process models to be used so that there is an actual graphic for employees to follow and be informed of. There is a process for which employees can follow and see if they have gone wrong at any stage or not.

This then allows for the business to be more visible and flexible, which is fundamental to a business success and gain a competitive advantage.

Busness Process Mapping. Source: http://www.sebata.co.za/sebata/index.php?option=com_content&view=article&id=42&Itemid=29