Ch 6 Business Intelligence.pdf
6 INTERNATIONAL DECISION SUPPORT SYSTEMS
Many executives are choosing to internationalize operations to avail the corporation of larger and more fruitful markets, competition among labor forces, and economical location and distribution incentives. With internationalization comes geographical dispersion, increased industrial and market competition, and increased access to labor pools and natural resources. However, it also brings variations in the technical, legal, economic, and cultural forces affecting the operations and decision making of the enterprise, the impact of which is affected by the form of internationalization.
Transnational corporations can take on a variety of forms. For example, it is possible that offices in the various countries produce different products and are essentially separate. On the other hand, it is possible that the products are manufactured or created in one country and marketed in another. Or there can be some combination of the two, such as what Dyment (1987, p. 22) described:
The global corporation may have a product that was designed in a European country, with components manufactured in Taiwan and Korea. It may be assembled in Canada and sold as a standard model in Brazil, and as a model fully loaded with options, in the United States. Transfer pricing of the components and assembled product may be determined with an eye to minimizing tax legality. Freight and insurance may be contracted for relet through a Swiss subsidiary, which earns a profit subject only to cantonal taxes. The principal financing may be provided from the Eurodollar market based in London. Add the complexities of having the transactions in different countries, with foreign exchange hedges contract gains and losses that sometimes offset trading losses or gains, and one has a marvelously complex management control problem.
Decision Support Systems for Business Intelligence by Vicki L. Sauter Copyright © 2010 John Wiley & Sons, Inc. 279
280 INTERNATIONAL DECISION SUPPORT SYSTEMS
Another form of internationalization is described by Sankar and Prabhakar (1992, p. 251). This example involves not the production process but rather the sharing of data.
Consider the development of a Decision Support System that could support stock trans-actions for transnational brokerages with offices in New York, Rome and Frankfurt. Such a DSS must monitor the activity on multiple exchanges and in multiple markets to help the analyst determine what stocks to trade, when to trade them, and how to trade them. If the stock broker in New York wants to initiate a particular stock transaction, and if that company is listed on multiple exchanges, he or she needs to decide trading on which ex-change is most profitable. If for example, the decision is made to trade on the Rome Stock Exchange, the transaction is sent to a front end processor (FEP) in New York, which then transmits it to Rome using a private line. The Rome office sends a confirmation message to New York and sends a duplicate copy of the transaction to the head office. Further, the database used by brokers at all offices needs to be updated immediately so that models tracking trades and prices will be accurate. Clearly the coordination among these systems, while still providing decision support, is challenging.
Decision support systems have the potential for great assistance for multinational de-cision making because technical variability, legal innuendos, cultural differences, and eco-nomic pressures and their coordination exacerbate the turmoil associated with the poorly defined choice processes generally supported by DSS.1 However, if not implemented prop-erly, DSS can add to the problems of transnational decision making. In order to exploit the benefits, designers need to be sensitive to a wider variety of issues and problems than those considered in the design of domestic systems.
For example, there is reason to believe that there would be differences in preferences for user interface options for transnational systems. Understanding the preferences and their implications is crucial. Since the user interface is the only way one can interact with the computer, its acceptance by users limits the usefulness of the system as a whole.
The user interface can communicate the importance of information and modeling within a system. Different colors, size of representation (and relative size of representation), spatiality, and contrast provide the “nonverbal cues” for the user interface. Even the way in which one moves from screen to screen or accesses information carries some significance. That is, the user interface can convey what is important to the organization, how the “power” in the organization is controlled, or the corporate norms and expectations.
Consider the screen shown in Figure 6.1. In this screen, the financial implication of a proposed transnational corporate change to the United States is emphasized. The message is carried in two ways. First, the implications for the United States are the only ones that default as open to the screen. Users of the system are, in a sense, forced to at least see them (if not use them). However, the implication is that information regarding all other countries is “optional” to the decision because the user needs to take explicit action to cause those results to appear on the screen. The second way in which the United States is emphasized is through the size of the windows. Even after one has opened the windows for other countries, they are considerably smaller than the window containing the U.S.
1A team at the University of California at Irvine’s Center for Research on Information Technology and Organizations studied the role of information technology in the economies of 11 Asia-Pacific nations. In countries where the investment in information technology exceeded other investments, such as plants and equipment, productivity was the highest. “This means IT investment is more productive than other investments,” says one researcher.
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Figure 6.1. User interface implications.
financial data, hence conveying that the non-U.S. data are less important. A similar effect could have been obtained by displaying financial data only in U.S. dollars and not in local currencies. The implication of these differences is, of course, only a problem if the message they convey is unintended.
A second problem also is illustrated in Figure 6.1. In this case, instead of emphasizing a specific country, the size and default open options suggest the relative importance of particular analyses. As in the previous example, this screen design suggests that financial implications are the most crucial, whereas all other analyses are clearly secondary. This suggestion of the importance of particular steps in a typical analysis is also conveyed in Figure 5.31. In that screen, the system provides explicit encouragement for the user to attempt to change values and rerun the simulation. The availability of the option is making a statement about the importance of sensitivity analyses; the subtle recommendation would not be apparent without those automatic rerun buttons. This apparent support for particular options can present a problem for a transnational DSS when there are clear cultural differences in the modeling preferences across the cultures. Such differences will be discussed in later sections of this chapter.
Better user interfaces would have given non-U.S. countries greater representation on the screen. Perhaps no analyses would be open as a default, but rather the world as a whole is shown, and users can click on the country—or countries—of interest. Similarly, it would send less of a message if users needed to actually request all options.
The relative sizing and location of objects on the screen are not the only aspects needing attention in a transnational DSS. Since the user interface may be the basis for interaction with other managers using the system, users become totally dependent on this interface for prompts that would otherwise come from “nonverbal cues” and other tempering cues in communication. Hence, words lose their intonation and the user becomes totally dependent upon symbols and icons to convey more information. These new ways of affecting patterns
