Decision-making refers to the process of finding and selecting options according to the priorities and values of the person making the decision (Haag & Cummings, 2008). Due to the integral role of decision making in company growth and financial progress, many firms allocate huge investments for business intelligence systems for the purpose of facilitating improved decision making process in business. In this paper, I take a critical look at Decision Support Systems and how they affect organizational decision making.
Advantages of Decision Support Systems
Decision Support Systems (DSS) help with time management (Power, 2002). All groups of DSS offer reduced time cycle in the decision making process. At Amazon.com, DSS enhance the productivity of employees and facilitate timely acquisition of information that is necessary for the decision making process.
DSS facilitate enhanced interpersonal communication among people responsible for decision-making. Model-based Decision Support Systems offer a platform for sharing certain facts and suppositions regarding the decision making process. At Amazon.com Data-driven Decision Support Systems make certain information about the company available to managers to make it easy for them to make decisions that ensure the company’s growth and continued success.
DSS improve the effectiveness of decision-making and lead to informed and applicable decisions. The quality of decisions made and effectiveness of the decision making process are, however, not easily computable. DSS also provide companies like Amazon.com with a competitive edge over their rivals. Web-based DSS used at Amazon.com, for instance, provide the company with original, high risk, company-wide DSS that ease decision-making and company growth in the highly competitive e-commerce market.
DSS also increase the satisfaction level of the decision maker by minimizing the frustrations involved in the process. In addition, DSS reduce the costs associated with decision making in a company. This is good news to managers and decision makers whose target is to maximize profit. DSS (especially Data-driven Decision Support Systems) also increase the level of control that managers and decision makers have over the company (Power, 2002).
Disadvantages of Decision Support Systems
Though DSS are integral to the decision making process of organizations, they introduce some problems. For instance, DSS can overemphasize decision-making. Therefore, it is important that managers are exposed to other factors that contribute to organizational success such as sociopolitical factors.
Another disadvantage of DSS is founded on the balance of power involved (Power, 2002). Some managers see the use of DSS as taking the power of decision making away from them. This perceived transfer of decision-making power to a software program makes some managers reluctant to embrace the use of DSS.
Some managers also fail to take responsibility in case mistakes are made decision-making and instead choose to transfer the blame to DSS. However, it is computers users and not computers that make mistakes. Therefore, responsibility during the application of the systems lies with the makers and users of the systems.
Types of Decisions Faced at Amazon.com
The bulk of decisions faced at Amazon.com that require the application of DSS are in areas of customer relationship management and supply chain management. DSS are also important at Amazon.com for data mining and response to certain trends obtained from data. The company’s chief executive officer, Jeff Bezos, often responds to customer complaints by sending emails to employees who are expected to come up with solutions to the problems addressed. Other decisions involve which products to be included in the company’s database, certain management decisions, new branches targeting different countries, and how to handle competition from other e-commerce companies.
Conclusion
I believe that Decision Support Systems (DSS) can be properly implemented to facilitate decision making process as is done at Amazon.com. At Amazon.com, DSS are used to emphasize change, speedy response and flexibility in decision-making. Though I believe that DSS are important in decision-making, there are concerns that must be addressed to make the implementation of DSS more sustainable and effective.
References
Haag, S. & Cummings, M. (2008). Management information systems for the information age. (Laureate Education, Inc., custom ed.). Boston: McGraw-Hill/Irwin.
Power D. (2002). Decision support systems: Concepts and resources for managers. USA: Greenwood Publishing Group.