Management Decision Making, Characteristics and Components of Decision Support System



Health Management Information Systems (HMIS)

Health Management Information Systems (HMIS) are one of the six building blocks essential for health system strengthening. HMIS is a data collection system specifically designed to support planning, management, and decision making in health facilities and organizations.

Health information management (HIM) is information management applied to health and health care. It is the practice of acquiring, analyzing and protecting digital and traditional medical information vital to providing quality patient care. With the widespread computerization of health records, traditional (paper-based) records are being replaced with electronic health records (EHRs). The tools of health informatics and health information technology are continually improving to bring greater efficiency to information management in the health care sector. Both hospital information systems and health human resources information systems (HRHIS) are common implementations of HIM.

Health information management professionals plan information systems, develop health policy, and identify current and future information needs. In addition, they may apply the science of informatics to the collection, storage, analysis, use, and transmission of information to meet legal, professional, ethical and administrative records-keeping requirements of health care delivery. They work with clinical, epidemiological, demographic, financial, reference, and coded healthcare data. Health information administrators have been described to “play a critical role in the delivery of healthcare in the United States through their focus on the collection, maintenance and use of quality data to support the information-intensive and information-reliant healthcare system”.

The World Health Organization (WHO) stated that the proper collection, management and use of information within healthcare systems “will determine the system’s effectiveness in detecting health problems, defining priorities, identifying innovative solutions and allocating resources to improve health outcomes.”

What is Decision Making?

Decision-making is an integral part of modern management. Essentially, Rational or sound decision making is taken as primary function of management. Every manager takes hundreds and hundreds of decisions subconsciously or consciously making it as the key component in the role of a manager. Decisions play important roles as they determine both organizational and managerial activities. A decision can be defined as a course of action purposely chosen from a set of alternatives to achieve organizational or managerial objectives or goals. Decision making process is continuous and indispensable component of managing any organization or business activities. Decisions are made to sustain the activities of all business activities and organizational functioning.


Decisions are made at every level of management to ensure organizational or business goals are achieved. Further, the decisions make up one of core functional values that every organization adopts and implements to ensure optimum growth and drivability in terms of services and or products offered.

As such, decision making process can be further exemplified in the backdrop of the following definitions.

Definition of Decision Making

“Decision-making involves the selection of a course of action from among two or more possible alternatives in order to arrive at a solution for a given problem”.

Further, decision making process can be regarded as check and balance system that keeps the organization growing both in vertical and linear directions. It means that decision making process seeks a goal. The goals are pre-set business objectives, company missions and its vision. To achieve these goals, company may face lot of obstacles in administrative, operational, marketing wings and operational domains. Such problems are sorted out through comprehensive decision making process. No decision comes as end in itself, since in may evolve new problems to solve. When one problem is solved another arises and so on, such that decision making process, as said earlier, is a continuous and dynamic.

Decision Making in an Organizational Context

Decision making is part of everyone’s life and all of us have to make decisions every moment. Right from choosing what to wear to what to eat to where we live and work and extending to whom we marry, decisions are an integral part of our lives. In an organizational context, it is worthwhile to note that decision making needs the right kind of information, the complete information and the ability to synthesize and make sense of the information. While the first two attributes depend on external sources, the ability to make informed decisions is a personality trait. Hence, successful CEO’s are those who can take into account the different viewpoints and divergent perspectives and arrive at the right decision.

The business landscape of the current times is littered with examples of companies that have made strategic errors and these are mostly to do with lack of proper decisions taken by the CEO’s and managers in these firms. For instance, the failure of Chrysler and Ford (the automobile majors in the United States) to meet the challenge of competition from Japanese auto majors like Toyota was mostly due to the lack of imaginative decisions that would have responded to the threat in a coherent manner. Of course, it is another matter that these companies (Chrysler in particular) under the stewardship of Lee Iacocca were able to successfully meet the competition by the Japanese because of firm decisions taken by him.

The other aspect that relates to decision making in an organizational context is that there must be complete and accurate information made available to the decision maker. In Economics, there is a term called “asymmetries of information” that indicates how incomplete and insufficient information leads to poor decisions and wrong choices. What this concept means is that having partial information or faulty information often leads to “analysis paralysis” which is another term for poor decision making abilities. Finally, even with reliable and accurate information, the decision maker ought to have good problem solving skills and astute decision making abilities to arrive at sound judgments regarding the everyday problems and issues.

The overriding rule in decision making is that the decision maker ought to have legitimacy and authority over the people who he or she is deciding upon. In other words, decision makers succeed only when their decisions are honored and followed by the people or groups that the decision impacts. The reason for mentioning this towards the end is that in many cases, the fragmented nature of the organizations with different interests represented by factions often undermines the decision making capabilities of the decision maker. Hence, it is worth mentioning that such authority must be vested with the decision maker.

Hence, it is clear that the topic of decision making encompasses several elements (some of which have been briefly discussed in this article). We hope to cover more of these elements in detail in the subsequent articles and this article is thought of as setting the tone for the rest of the module on decision making.

Decision Support System characteristics and Components

Decision Support System are interactive information systems that depend on a (having different things working together as one unit) set of user-friendly hardware and software tools to produce and present information that is targeted to support the management in the decision-making process. The decision support systems help management decision-making by combining data, fancy (or smart) (related to careful studying or deep thinking) models and user-friendly software into a single powerful system that can support semi-structured or (without rules, schedules, etc.) decision-making. The decision support system is under user control, from early beginning to final putting into use and daily use. Decision support system helps to close the information gap to enable managers to improve quality of their decisions. While MIS is carefully thought believed useful for structured decisions, DSS is carefully thought about to be more useful for decisions at the strategically /strategic levels, where decision-makers are often angrily stood up to with complex decisions which are beyond their human abilities to (creation/combination)e properly the factors involved. DSS refers to a class of systems, which support in the process of decision-making and does not always give a decision itself. These systems can be used to validate decision by performing sensitivity analysis on different guidelines of the problem. read more about information technology and human resources meaning

While developing decision Support System, the focus must be on identifying a problem and a set of capabilities that users consider useful in arriving at decisions about that problem. While developing DSS, therefore, care must be taken to make sure that the Decision Support Systems possess the following desirable characteristics:

  1. Should aid the decision-maker in decision-making.
  2. Should be able to address semi/un-structured decision-making situations.
  3. Should support decision-makers particularly at tactical/strategic levels.
  4. Should be able to create general-purpose models, simulation capabilities and other analytical tools available to decision-maker.
  5. Should enable users to use DSS without assistance from MIS/technical professionals.
  6. Should be readily adapted to meet information requirement for any decision environment.
  7. Should provide mechanism to enable rapid response to a decision-maker’s request for information. 8. Should have the capability to interface with corporate database.
  8. Should be flexible to accommodate variety of management styles.
  9. Should facilitate communication between/among various levels of decision-making.

11 Should have in-built flexibility and ability to evolve as user-sophistication grows.

12 Using of interactive methods are better advised.

Components of Decision Support System

  1. Dialogue management: It has three subsystems. The user interface subsystem manages the physical user interface. It controls the appearance of the screen, accepts input from the user and displays the results. It also checks the user commands for correct syntax. The dialogue control subsystem maintains a processing context with the user. The request translator is to translate the user command into actions for the model management or data management components into a format understandable by the user. Since flexibility and ease of use are important in DSS, GUIs are becoming the standard for DSS applications. Database is normally through SQL.


  1. Model management: The command processor receives the commands from the dialogue management components and delivers those commands from the dialogue management components to either the model base management system or the mode execution system.
  2. Database management: It stores and manipulates the database as directed by either the model management component or the dialogue management component. Secondly, it maintains an interface with data sources that are external to the DSS, viz., TPS database, inter-enterprise systems, external data utilities and other DSS applications.

Types of Decision Support system

  1. Status inquiry systems: The number of decisions in the operational management and some at the middle management are such that they are based on one or two aspect of decision-making situations. It does not call for any elaborate computation, analysis, choice. If the status is known the decision is automatic.
  2. Data analysis system: Decision systems are based on comparative analysis and make use of formula or an algorithm. These processes are not structured. The use of simple data processing tools and business rules are required to develop this system. Examples include personnel inventory system, cash flow analysis, etc.
  3. Information analysis system: Data is analysed and the information reports are generated. Reports can have exceptions. These reports are used for assessment of situation. Examples include sales analysis, accounts receivable, etc.
  4. Accounting system: These systems are not necessarily required for decision-making, but they are desirable to keep track of the major aspects of the business or a function. These system account items such as cash, inventory, personnel and relate it to a norm or norms developed by the management for control and decision.
  5. Model-based system: These systems are simulation models or optimization models for decision-making. These decisions, generally are one time and infrequent and provide general guidelines for operation or management. Examples include product mix, job scheduling rules, etc.