The Decision Support System was developed in the early 1980’s where the first one was designed in Lotus 1-2-3, based on x86 programming language. It was improved into an Excel spreadsheet as time went on with implementation of even more intense services. It has been used by managers, business firms, and institutions for the purpose of integrating relevant sources of statistics and analyzing it for the sake of simplicity and functionality. DSS can process information from a database with guided entry to assist the user in filling the necessary field so that it gives a projection of sales or distribution for certain stipulated periods (Burstein, 2008).
P&G employs this DSS to ensure it retains a constant supply of products to its customers and distribution outlets. DSS is capable of estimating the stocks level in the shelves and warehouses given the unit stock replenishment data samples. In the systems database, the company has suites that are capable of estimating the ordering cost and holding costs depending on the demand forecast of the goods and services derived from the organization (Burstein, 2008). Simply the DSS enhances the management of the economic ordering quantity (EOQ).
Benefits of the inventory decision systems used at P&G
Decision support system is a system that enables, during the time of P&G to determine queue theory system of First In, First Out (FIFO) or in other words First Come First Serve (FCFS). This enhances customer satisfaction and also cost effectiveness where one would determine the ordering cost, holding cost and finally the shortage cost through demand forecast where the organization would determine the amount or quantity of goods and services required for a given period of time. This does not only reduce the cost but also helps in reduction in surplus production (Burstein, 2008).
The introduction of Decision Support System enabled the sharing of inventory system information where different branches of an organization could coordinate their transaction for a more precise or articulate result. What comes to mind is Material requirement Planning (MRP). This is a computer based inventory system that depends on the master schedule which determines the material required to carry out production and finds ways to acquire the material specified for production. Material Requirement Planning (MRP II) this is an advancement of MRP, where Material Requirement Planning II links customers to suppliers where customers determine the amount of input to be used to satisfy their required outputs (Burstein, 2008).
Just In Time (JIT) is a system developed in Japan which reduced the inventory level and the inventory cost (Burstein, 2008). This is where suppliers delivered the input or raw material required for production in a given period of time without surplus or deficit, that is no inventory system required. This type of system depends on suppliers ability to supply the right amount fore production hence there is no inventory cost involved.
Decision Support System helps in the reduction of man power in terms of salaries and insurance covers. The system actually gives a number of suggestions for solving a particular decision or a problem, thus it gives the top management the option to choose which action to take to tackle or solve a problem, hence helps in time saving.
Use of the P&G DSS as a Web-based DSS
It is essential in the business sector for the availability of Decision Support System in a global scale to enhance effective distribution of consumer and input products for both customers and manufacturers across the globe.
The realization of Decision Support System has led to the improvement of the supply chain and inventory system management. As earlier said it has led to the reduction of inventory cost to over 349 million Dollars. P&G has projected its supply chain to major international scales, deeming it necessary to reach the global market through as many ways as it can. It is therefore important to make the Decision Support System a web-based DSS to enable consumers from all over the world purchase and access the company’s inventory database. In short, making the P&G a web-based DSS enables consumers to access consumer products that are not locally accessible.
The use of DSS by competing organizations would require P&G to establish its market share well before its competitors establish roots in the market. By allowing the consumer interaction to the company, they would establish a wider customer base and beat the competitor, by providing the exact consumer goods specified.
Deduction from P&G utilization of DSS
Decision Support System simply involves the whole organization where all functions of the organization are equally involved in the production system which entails inventory level and distribution cost. We can incorporate Decision Support System into an organization to stimulate distribution of consumer product, hence cutting down operation expenses.
Furthermore, a company can widen its customer base by employing the use of Decision Support System, because DSS incorporates data warehouses, Information System and Inventory System Management, and can therefore serve a larger number of customers in a shorter time. In this way, an organization increases its customer base because word about that particular company’s fast and efficient services will spread widely to a large number of people.
The Decision Support System also develops, completes and improves the suggested ways of solving a particular problem and ensures that the person making the decision gets access to these suggestions so that he or she can validate them. This is usually a continuous cycle that is followed until the organization reaches the final and most suitable decision. Through this, an organization gets to improve its decision making process and in this way utilizes both the time and energy used in coming up with organizational decisions (Burstein, 2008).
By use of a DSS, a company can elevate its performance through the automated data handling system employed by the software. Looking at how diverse the business world has become, it is apparent that using manual labor is uneconomic and inefficient for market system analysis. The simplified software provides training modules and manuals that can educate the user on ways to utilize it, thereby eliminating the need for training personnel. Generally, P&G has experienced many benefits from the use of this software than any level of skilled manpower can provide. The intricacy of the software distinctly indicates this. DSS should be employed in management systems allover the world to simplify decision-making and business operations.