different methods of determining executive information need. What are their relative merits and demerits

Executive information systems (EIS), are becoming the primary tools of top-level control in some organizations. They can be best understood by contrasting them with DSS, which they com plement.

The feature of EIS is to access to a large variety of internal and external data, terse presentation of information with colorful graphics, the ability to "drill down" on more and more detailed data, and the ability to control the system in a very easy way.

Speaking tersely: while DSS are primarily used by middle- and lower-level managers to project the future, EIS primarily serve the control needs of higher-level management. They help an executive to spot a problem, an opportunity, or a trend. EIS also have forecasting capabilities that can be used in an "automatic pilot" fashion; in addition to their other features, these capabilities make EIS a strategic planning tool.

Seen in the light of the structure of a decision-making process, EIS primarily assist top management in uncovering a problem or an opportunity. Analysts and middle managers can subsequently use a DSS to suggest a solution to the problem. More recently, EIS-type applications are coming into use by middle managers as well

At the heart of an EIS lies access to data. EIS may work on the data extraction principle, as DSS do, or they may be given access to the actual corporate databases. The first kind of EIS can fully reside on personal worksta tions; EIS of the second kind need the power of minis or mainframes to access corporate data. The technical problems of EIS data access pale in comparison with the problem of potential resistance from managers below the top level. Once an EIS has been set up, its executive users are able to obtain virtually instantly any information supported by the EIS data-unfiltered and unable to know their subordinates.

In the design of EIS, developers frequently rely on the critical success factors (CSF) methodology developed by John Rockart of MIT. He de fined CSFs as "those few critical areas where things must go right for the busi ness to flourish." With the use of this methodology, executives may define just the few indicators of corporate performance they need. Many executives have already fallen into the habit of reviewing these indicators on a regular, sometimes daily, basis. With the drill down capability, they can obtain more detailed data behind the indicators. An executive who is experienced with such a system can perceive a trend (and a problem) in seconds.

As opposed to the CSF methodology, which relies on the individual critical suc cess factors, the strategic business objectives methodology of EIS development takes a company-wide perspective. Following the identifica tion of the strategic business objectives of a firm, the critical business processes are identified and prioritized, and then the information needed to support these processes is defined-to be obtained with the EIS that is being planned. This methodology avoids the frequent pitfall of aligning an EIS too closely to a par ticular sponsor.

In the United States, Commander EIS (by Comshare of Ann Arbor, Michigan) and Pilot EIS (by Pilot Executive Software of Boston) lead the EIS field. RE· SOLVE from Metapraxis (New York and of Kingston upon Thames, England) is a leader in Europe. All of these systems are actually EIS generators, which help to configure a specific EIS.

In general, organizational DSS are conceptually more complex than the rather well-structured EIS, primarily due to the model-management component of DSS.

No comments:

Post a Comment