ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

What is Decision Support System (DSS) and why every manager needs one

Updated on November 1, 2012

The term “Manager” is synonymous with decision makers and every organization, be it profit making or non-profit making, needs a decision maker. Business organizations not only need decision makers but also the decisions should be made quickly and accurately.

Every manager in an organization is a decision maker and the day-to-day business involves making decisions that affect the running of the organization besides other duties such as interpersonal and informational roles. For a long time, managers considered decision making a talent acquired through trials and errors.

Managers need Decision Support System (DSS)
Managers need Decision Support System (DSS) | Source

However, the business environment where business managers operate is changing rapidly and becoming more complex. As a result, decision making today is more complicated than ever before but why exactly is that so?

1. The number of alternatives today is larger than before because of improved information technology and communication systems and especially with the availability of internet.

2. The cost of making errors can be very large because of the complexity and magnitude of operations.

3. There are continuous changes in the fluctuating environment and more uncertainty in several impacting elements

4. Decisions must be made timely, quickly and accurately

Managers cannot therefore continue relying on trial and error methods in making decisions. They must learn and employ new tools and technology being developed in their respective fields of management. A Decision Support System (DSS) is therefore a must for today’s managers.

What is a Decision Support System?

Little (1970), defines Decision Support System (DSS) as a model based set of procedures for processing data and judgments to assists a manager in decision making. He argues that to be successful, such a system must be simple, robust, easy to control, adaptive, complete on important issues and easy to communicate with.

A DSS is a system intended to support managerial decision maker in semi-structured decision situation. A DSS extends decision makers capabilities but it does not replace their judgment i.e. it only support.

Examples of DSS include Group Support Systems (GSS), Executive Information Systems (EIS), Knowledge Management Systems (KMS), Expert Systems (ES), Artificial Neural Networks (ANN), Intelligent Decision Support Systems (IDSS) and many more.

So, how does managerial decision making connect with information systems? We may need to understand the terms “Management” and “Decision making”.

What is Management?

The term “Management” has many varying meanings depending on the context. For the purpose of understanding, I will put it simple: It is the process by which organizational goals are achieved through the use of resources such as vision, mission, objectives and goals. These resources are considered as inputs and the attainment of goals is viewed as the output of the management process.


What is Decision making?

Decision making is the process of selecting the cause of action from available causes. In its simplest form, decision making involves three phases;

1. Intelligence: Searching for condition that calls for action.

2. Decide: Inventing, developing and analyzing possible causes of action.

3. Choice: Selecting the cause of action from those available.

These three phases of decision making may involve structured, semi-structured or unstructured decision making processes. Structured processes are routine problems for which structured solutions may exist. Unstructured processes are complex problems for which there are no standard solution methods.

Decisions in which some but not all of the phases are structured are called semi-structured and solving such problems involves a combination of standard problem solving procedures and human judgment.

Decision Support System (DSS) can help managers to make better and informed decisions
Decision Support System (DSS) can help managers to make better and informed decisions | Source

Why managers need Decision Support System (DSS)

The level of productivity or success of the management depends on the performance of the managerial functions such as planning, organizing, directing and controlling.

To carry out these functions, managers are engaged in continuous process of making decisions. In fact, all managerial activities revolve around decision making and therefore managers are decision makers and every organization is filled with decision makers at various levels.

Suppose you are the manager of a business organization dealing in products or services. Imagine also that the market is very competitive and has large companies competing with medium and small ones. Probably some of the questions you will be faced with include the following;

1. How will you attract customers?

2. Will competitors reduce their prices?

3. What new services will competitors offer and what should you do in response?

To solve such problems, managers need to make accurate decisions quickly. Managers also need access to internal and external data to aid in their decision making. With the help of Decision Support Systems (DSS), these and many other problems can be solved quickly and effectively.

With a DSS, pricing for each customer can be made and statistical tools can be used to analyze shopping data collected daily. These can help the organization to know, for example, which customer or category of customers qualify for what level of discount.

DSS with capabilities of forecasting and predication such as Artificial Neural Networks (ANN) can be used together with a forecasting model to analyze growth patterns of each product.

The appropriate decisions pertaining to the product can be made timely, quickly and accurately. Such decisions may involve whether to terminate or expand sales or marketing of the product.

Top and executive managers can use DSS such as Executive Information Systems (EIS) to tabulate daily sales summary and details by region, division, sales person and product. These reports, which can be viewed in varying perspectives, can be useful in identifying problems and opportunities.

Any Decision Support System (DSS) therefore helps management to make timely decisions by providing reliable and relevant information in the correct format and at the right time. A DSS can help a company to extract data required to understand the market better on prices, quantity, timeliness and customer service.

A DSS can improve the quality of information for which the solution is based by providing not only a single solution but an array of alternative solutions. This allows managers to understand the nature of the problem better so that they can make better and informed decisions.


This website uses cookies

As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

Show Details
HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
LoginThis is necessary to sign in to the HubPages Service.
Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
AkismetThis is used to detect comment spam. (Privacy Policy)
HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
MavenThis supports the Maven widget and search functionality. (Privacy Policy)
Google AdSenseThis is an ad network. (Privacy Policy)
Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
Index ExchangeThis is an ad network. (Privacy Policy)
SovrnThis is an ad network. (Privacy Policy)
Facebook AdsThis is an ad network. (Privacy Policy)
Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
AppNexusThis is an ad network. (Privacy Policy)
OpenxThis is an ad network. (Privacy Policy)
Rubicon ProjectThis is an ad network. (Privacy Policy)
TripleLiftThis is an ad network. (Privacy Policy)
Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)
ClickscoThis is a data management platform studying reader behavior (Privacy Policy)