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Chapter 15

Decision-Making Models and Knowledge Management

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Outline

• Learning objectives

• Information overload

• Knowledge management

• Steps for Better Thinking

• Current topics

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Learning objectives

1. Discuss and give examples of the concept of information overload, including causes, symptoms, and countermeasures.

2. Explain the nature of decision models and knowledge management.

3. Explain why those two topics are important in the study of accounting information systems.

4. Describe and apply Wolcott and Lynch’s Steps for Better Thinking.

5. Explain fundamental concepts associated with Big Data, data analytics and cloud computing.

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Information overload

• Definitions– The point at which

information incorporated into a decision begins to decline

– Information supplied exceeds human processing capacity

• Causes– Personal factors– Information

characteristics– Task and process

parameters– Organizational design– Information technology

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Information overload

• Selected countermeasures– Allow more time to complete important tasks.– Compress, aggregate, categorize, and

structure information.– Formalize the language used to describe

information.– Handle information as it comes to you—don’t

put it off!– Use graphs and other visual aids.

See the chapter for a full list.

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Knowledge management

• Definition

The process through

which organizations

generate value from their

intellectual and

knowledge-based assets

• Objectives1. Create knowledge

repositories.2. Improve knowledge

access.3. Enhance the

knowledge environment.

4. Manage knowledge as an asset.

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Knowledge management

1. Create a supportive

organizational culture.

2. Define business goals.

3. Perform a knowledge

audit.

4. Create a visual map.

To create a

knowledge

management

system (KMS),

follow these

seven steps:

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Knowledge management

5. Develop a knowledge

management strategy.

6. Purchase or build

appropriate tools.

7. Periodically reassess

the value of the KMS

and adjust accordingly.

To create a

knowledge

management

system (KMS),

follow these

seven steps:

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Steps for Better Thinking

• Developmental problem-solving and decision-making process

• Developed by Wolcott and Lynch

• Applied throughout accounting and other areas

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Steps for Better Thinking

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Current topics

Big Data Data analytics

Cloud computing

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Current topics • Types of Big Data

– Web and social media

– Machine-to-machine

– Big transaction

– Biometric

– Human-generated

• A specific example may fit more than one group

Big DataA collection of data

from traditional and

digital sources inside

and outside your

company that

represents a source

for ongoing

discovery and

analysis

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Current topics • Three broad types

– Descriptive

– Predictive

– Prescriptive

• Example tools– SAS Enterprise Guide– SAS Enterprise Miner– R– SAP HANA– Excel Miner

Data analyticsTools decision

makers can use to

analyze Big Data

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Current topics • Examples

– Google Drive

– Amazon Cloud

• Applications– Calendar sharing

– Document sharing

– Social networking

– Data backup

Cloud computing

A general term

for anything that

involves

delivering hosted

services over the

Internet

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