Current status of DSS use in Taiwan

Information & Management North-Holland

199

22 (1992) 199-206

Research

Current Ching-cha National

status of DSS use in Taiwan Introduction

Hsieh

Taiwan Utzicvvsity, Taipei, Taiwan, ROC

Ming-te

Lu

St. Cloud State CJni~x@v. St Cloud, MN, USA

Chien-chun National

Pan

Taiwarz Urticm-sity, Taipei, Taiwan, ROC

Results of a survey of Decision Support Systems use and non-use in Taiwanese firms are presented. The current status of DSS in Taiwan is described in terms of the extent of applications, patterns and frequency of use, sources of software, user participation, development effort, and user satisfaction. Reasons for non-use are analyzed with respect to knowledge about DSS, attitude of the decision makers, task nature, organizational support, and availability of DSS technology. For firms using DSS, problems associated with its use are investigated. DSS implementation strategies are suggested. Keywords: Taiwan, Developing countries, Decision support systems, Current status, Problems, Implementation strategies.

One attribute of a developed nation is that its information activities account for a greater portion of GNP than that of a developing or underdeveloped nation. The information activities carried out by information workers consists of thinking, processing information, formulating analyses, recommendations, and procedures [3]. Such activities exist in all business firms and governmental agencies. For a nation to improve its GNP, its information workers should continuously improve their productivity such that these information activities may be carried out in a more efficient and effective way. Providing workers better tools improves their productivity: DSS is such a tool. Since the early 1970’s, rapid advances have been made in DSS research and implementation. From 1975 to 1987, over 300 articles were published on DSS [4]. It is now generally agreed that DSS is one of the most

Acknowledgment: The authors would like to express their appreciation for the time Professor Gary Yoshimoto spent on reviewing the final draft of the manuscript and for his comments on statistical analyses used.

Ming-te Lu is Professor of MIS in the Department of Business Computer Information Systems at St. Cloud State University. He received his M.S. and Ph.D. from the University of Minnesota. He has published many articles in academic and practitioner journals of MIS. His current teaching and research interests include DSS, expert system applications, and applications of IT in developing countries.

Ching-cha Hsieh is Professor of MIS in School of Management at National Taiwan University. She received her Ph.D. in MIS from National ChiaoTung University. Her research interests include the competitive use of information technology, systems analysis and design methodologies, and the organizational impacts of information technology.

Correspondence to: Professor Ming-te Lu, College of Business, St. Cloud State University, St. Cloud, MN 56301, U.S.A. 037X-7206/92/$05.00

0 1992 - Elsevier

Science

Publishers

Chien-chun Pan was an Associate Professor of the Department of Business at National Taiwan University when this article was written. She received her Ed.D. in Business Education with concentration in Communications from Oklahoma State University. Dr. Pan has worked in the fields of communication and management. She has published papers in both English and Chinese language journals. pe

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effective means of improving information workers’ productivity. So far, only a few reports have been published on DSS use in Taiwan. In a survey conducted in 1984 [ll]. it was found that few governmental agencies used DSS. Lu et al. [ 121 conducted interviews on a limited basis in lY87 and found that DSS was practically unheard of in the industry. Lee and Mao [9] assert that the leading problem with computerization in Taiwan is “DSS developmcnt and implementation”. This paper presents the results of a new study of DSS use in Taiwan and attempts to formulate DSS implementation strategies for Taiwanese organizations. Specifically. the four objectives of the study are to: _ understand DSS use in Taiwan, _ uncover reasons for DSS non-use, - disclose problems associated with DSS use, an d _ recommend DSS implementation strategies.

Methodology A random sample of 200 firms was selected from the list of Top 1000 Marzufacruring and 300 Srrrke Firms in Tuiwun as published by Tien-siah, Taipei, Taiwan, 198X. Telephone interviews of the selected firms were conducted first to decide on the individual to whom the questionnaire should be addressed. The questionnaires were sent out and forty-six responses were received within a few weeks. An additional fifty-five questionnaires were received after the authors conducted followups. Excluding the 9 incomplete questionnaires, there were therefore a total of 92 useful questionnaires. Thus the actual response rate is forty-six percent. The first part of the questionnaire concerned the demographics of the firm and the respondent’s background. Next, the current status of DSS use in the organization was assessed through items pertaining to the extent of DSS use, DSS applications, DSS hardware types, pattern of DSS usage, frequency of DSS use, source of software, user participation, DSS development cost and time, and DSS user satisfaction. Alternatively, when the organization was currently not using DSS, reasons for DSS non-use were examined.

& Management

Past researchers have included over hundred different factors that they believe affect the use of DSS in an organization. All factors are related to one of the three entities - the decision maker, the decision task, and the organizational context. The study uses this framework, together with unique characteristics of firms in Taiwan, to select the appropriate factors for analyzing DSS non-use. Selected factors include knowledge about DSS, the attitude of decision maker, task nature, organizational support, and DSS technology availability. Based on these 5 factors, 22 reasons for DSS non-use were chosen (see Table I). For each reason, a S-point Likert like scale was provided for the respondent to check: 5 = strongly agree to 1 = strongly disagree. For organizations currently using DSS, the study attempts to uncover problems associate with its use. Guimaraes [6] addresses 18 problems associated with DSS use, while Lyytinen [13] summarizes IS use problems into 5 types: operations, data, conceptual, people, and complexity. Our study concentrates on operations and data, and based on these two types, 11 items were selected with the same 5-point scale used to solicit responses (see Tuhle 2). DSS use may lead to changes in the organizational structure. The introduction of DSS, therefore, has been viewed as an organizational change [5;7;8]. It has also been viewed as an internal technology transfer [lo]. Based on frameworks of organizational change and internal technology transfer. together with factors identifies previously with DSS use and non-use, fourteen questions on DSS implementation strategy were selected by the authors and used in the questionnaire (see Tdde 3).

Data analysis The ninety-two firms included in the survey are considered to be medium to large businesses in Taiwan. Textile. oil and refinery, electrical and machinery, and construction account for 74 percent. Most of the firms have gross sales of NT$3 billions or less (7 I %). Ninety-five percent of firms have employees less than 5,000. Computer use generally has been less than ten years (79%).

Information

C.-c. Hsieh et al. / DSS use in Taiwan

& Management

Table 1 Reasons for DSS non-use.

Table 3 DSS implementation

Group

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Il. 12. 13. 14.

I. Knowledge

about DSS

1. I have not heard of DSS 2. I do not know when computer decision making. Group

II. Attitudes

3. If there Group

of decision

is a DSS, I would

would

be useful

in my

maker

not use it.

III. Task nature

4. Decisions I make are mostly not repetitive in nature. 5. I usually do not face “what if” questions when making a decision. 6. Decisions I make mostly do not require extensive computational work. I make are mostly too simple to need a com7. Decisions puter. 8. Decisions I make are too complex for a DSS. 10. Decisions I make are mostly qualitative in nature. when making a 11. I usually do not have time pressure decision. for decision making is stable. 12. The environment Group

II/

Organizational

13. Top management quate. 15. Top management CBIS. 16. Top management is inadequate. Group

support

support

for computerization

does not encourage financial

V DSS technology

support

is inade-

the staff to develop for CBIS development

al,ailability

of MIS staff is inadequate. 9. Technical competence computer train14. My company does not provide adequate ing. 17. DSS is too expensive to use. 18. Benefits from DSS are too low. 19. DSS hardware and software are unavailable. system. 20. Data are not available in the corporate 21. My company lacks qualified DSS builders. 22. In-house help on DSS development is not available.

201

strategies.

Provide financial support from top management. Provide personnel support from top management Train users on DSS development. Train MIS staff on DSS development. Employ external consultant. Employ external DSS builder. Appoint internal change agent. Demonstrate DSS Prototypes. Provide DSS hardware and software. Establish a DSS unit. Promote DSS in MIS planning. Promote end-user computing. Educate top management on DSS. Educate MIS staff on DSS.

Privately-owned businesses account for 84 percent of the total. Majority of respondents to the survey have college or higher level of education (92%). Nearly half of them have used computers for more than five years (49%). Most are under forty years of age (82%). In addition, many have had over 100 hours of computer training (44%). Over one third of people surveyed use computer for more than ten hours per week. Cronbach’s coefficient alpha was calculated for items in each group of Table 1 except group II (only one item). Their respective values are 0.33, 0.51, 0.79, 0.87. The low scores for the first two groups indicate a need to develop additional questions in further research.

Results

Table 2 Major problems

with DSS use.

1. No user instructions are available. 2. Commands are not easy to use. 3. DSS development requires too much effort with no immediate payoffs. 4. System trouble-shooting is difficult and frustrating. 5. DSS is difficult to modify. 6. Long lead time for requested information. 7. Long lead time for taking care of technical problems. 8. Using the computer is too time consuming. 9. DSS is unreliable (poor response time or down time). 10. Information provided by DSS is not accurate nor timely. 11, DSS response time is too slow.

The results of the survey are presented in four parts: currents status, reasons for DSS non-use, DSS use problems, and DSS implementation strategies. Current status The current status of DSS in organizations is presented in terms of the degree of its use and various characteristics: 1. Extent of DSS use Among surveyed firms, twenty-eight have at least one DSS in use. The survey, however, does

202

R~WWCll

not reveal firm.

the extent

of DSS use within

a given

Table 5 Patterns of DSS usage. Pattern

3 _.

a.

b.

c.

d.

e.

f.

g.

h.

DSS chwucteristics arid usage DSS types - Alter’s DSS taxonomy [ll is used to classify DSS into types. The survey results show that majority of DSS uses are of ad hoc type, performing simple inquiries and calculations. On the other hand, model oriented DSS (which include the last four types of DSS USC) are also abundant. DSS hardware - Only 25 percent of the 28 firms have DSS on mainframes. In contrast, 50 percent of firms USC minicomputers and 74 percent use personal computers for DSS implementation. Patterns of DSS usage - Many DSS users interact directly with the system which implies that the majority of them are skillful computer users. Frequency of use - “On request” use accounts for majority of the cases which indicates that the need for most of the decision making occurs at irregular intervals. Periodic uses are mainly on a daily or monthly basis. Sources of software - A high percentage of the end-user developed systems indicates that end users in Taiwan are capable of designing and developing DSS. User participation in DSS development Users do actively participate in DSS developmcnt. The time spent, however, appears to follow roughly a uniform distribution with a varied degree of participation. DSS development cost - The median class for DSS development cost is from NT$50,000 to 100,000. DSS development time - The median developmcnt time is 2 to 3 months.

Periodic reporting Interact with a VDU Using coding forms (off-line) Through an intermediary

Table 6 Frequency

In

File drawer Data analysis Analysis Information Accounting model Representational models Optimization model5 Suggestion models

IS (56%) 18 (67%) 13 (48%) 13 (4X5) IO (37%) 8 ww) 7 (26%)

“St:

Not in use 12 (447)

0 (w-;) 14 (52? ) 14 (S2? ) 17 (63%) I’) (70%) 20 (74%)

In use

Not in use

I2 (50%) 16 (67%)

12 (so?;) 8 (33%)

15 (63%) 3 (13%)

9 (37%) 20 (87%)

of DSS use.

Frequency

In use

Not in use

On request Daily Weekly Monthly Quarterly Semiannually Annually

15 (5Xr/) 0 (35%) 2 (8%) 9 (3SS’r) 2 (8%) 2 (x0;) .i(lzc;)

11(42%) 17 (65%) 24 (92%) 17 (65%) 24 (92%) 24 (92”;‘) 23 (88%)

Table 7 Source of software. Source of software

In use

Not in use

End-User Developed MIS Department Developed Packaged Software Other

I2 (44% )

1s I3 21 20

Table X User participation Hours not involved IO hours or less IO to 20 hours 20 to 40 hours 40 to 60 hours 60 to 100 hours 100 to 200 hours 200 hours or more Total

DSS type

of usage

13 (48’;) 6 (22%) 6 (22%)

(56%) (52%) (789) (77%)

in hours. Frequency 17%*) (4% ) 17%) 17%) (8%‘) (8%) 17%) ( 12%) 24 (100%)

i. DSS user satisfaction - Most users are satisfied with their DSS, as indicated by the high percentage (82%) of the responses above the neutral (no opinion) response (see Tuhle II). Ratings in the table are calculated based on responses to the eight questions on the effect of DSS. Among the 8 questions, 4 are on the impact of DSS: 50 percent of respondents

Information

Table 9 DSS development Development

C.-c. Hsieh

& Management

Reasons for DSS non-use Frequency X 1 2 3 X 3

Unknown 10,000 or lower 10.000 to 50,000 50,000 to 100,000 100,000 to 500,000 500,000 or higher

(32%) (4%) (8%) (12%) (32%) (12%‘)

25 ClOO%)

Total

time.

Svstem development 1 week or less 1 to 2 weeks 2 weeks to 1 month 1 to 2 months 2 to 3 months 3 to 6 months 6 months to 1 year 1 to 2 years

time

Frequency 2 (8%) 1 (4%) 5 (21%) 2 @%i) 4 (17%) 6 (25%) 2 (8%) 2 (X%) 24 (100%)

Total

agreed that DSS have improved the decision outcomes (with an average rating of 3.7) and the quality of decision making (with an average rating of 3.5); 73 percent agreed that decision making quality is higher with DSS use than non-use (average rating of 3.9); furthermore, 68 percent agreed that DSS benefits outweigh DSS costs (with an average of 3.9).

Table 11 DSS user satisfaction. Satisfaction 2.88 3.00 3.13 3.25 3.38 3.50 3.63 3.75 4.00 4.25 4.50 Total

rating

203

cost (in NTS).

cost

Table 10 DSS development

et ul. / DSS use irl Taiwan

Frequency 2 (9%) 2 (9%) 1 (5%) 2 (9%) 3 (14%) 4 (18%) 1 (5%) 3 (14%) 2 (9%) 1 (5%) 1 (5%) 22 (100%)

Since there are twenty-two items and only sixty-four responses, factor analysis was not used. Item scores in each group were also not totaled due to inconsistent alpha coefficient values. Instead, average ratings and standard deviations were computed for each item in Table 1 and ranked in the descending order of the average ratings in Table 12. An analysis of the reasons for DSS non-use follows: Using neutral response (no opinion, 3) as the separator, the twenty-two reasons (items) may be partitioned into two groups: Items 1 through 11 and items 12 through 22. Since a score lower than 3.0 represents disagreement in the items in the second group questionnaire, should not be interpreted as reasons for not using DSS. The first group may be divided further into subgroups. Technical availability is represented by the first subgroup; i.e., the organization does not possess DSS technology. This subgroup involves items 1, 2, 7, and 10. A second subgroup portrays the lack of support from top management; it includes items 3, 6, 9, and 11. The third comprises those attributes of a decision task which may make DSS unnecessary; for example, items 4 and 8 indicate that the environment for decision making is stable and that decisions are qualitative in nature. The fourth subgroup involves the unavailability of data in the existing corporate CBIS. Items in the second group may also be assigned to four subgroups. The first represents the decisions maker’s attitude toward DSS, such as item 22: since it is in the second group, the decision maker’s attitude does not constitute the reason for not using DSS. The second subgroup includes items that represent the attributes of the decision task: items 21, 20, 19, 15, and 12; because they are in group two, there is evidence that respondents have some basic understanding of DSS use. The third subgroup measures the respondents’ awareness of DSS: e.g., items 16 and 17 show that respondents generally are aware of DSS. The fourth subgroup includes items on DSS cost and benefit: e.g., items 13 and 14. They show

that most respondents do not regard DSS as high cost and low benefit systems. 4. Based on this discussion, one may conclude that there are two major reasons for a decision maker/firm not using a DSS: lack of DSS development technology within the firm and an absence of top management support. The decision maker’s attitude toward DSS, nature of decision task, awareness of DSS, and expected DSS cost and benefit apparently do not constitute reasons for DSS non-use.

Table 12 Reasons for DSS non-use Reason 1. My company lacks qualified DSS builders 2. My company does not provide adequate computer training 3. In-house help on DSS development is not available 4. The environment for decision making is stable S. Data are not available in the corporate systems 6. Top management does not encourage staff to develop CBIS 7. DSS hardware and software are unavailable 8. Decisions I make are mostly qualitative in nature 0. Top management support for computerization is inadequate IO. Technical competence of MIS staff is inadequate I 1. Top management financial support for CBIS development is inadequate 12. Decisions I make are too complex for a DSS 13. DSS is too expensive to use 14. Benefits from DSS are too low IS. Decisions 1 make are mostly not repetitive in nature 16. I do not know when computer would be useful in my decision making 17. 1 have not heard of DSS 18. Decisions 1 make are mostly too simple to need a computer IY. Decisions I make mostly do not require extensive computational work 20. I usually do not have time pressure when making a decision 21. I usually do not face “what if” questions when making a decision 22. If there is a DSS, I would not use it

Table I3 DSS use problems. Problems DSS development requires too much effort with no immediate payoffs Long lead time for requested information DSS response time is too slow Long lead time for taking care of technical problems Using the computer is too time consuming No user instructions are available Commands are not easy to use DSS is difficult to modify System trouble-shooting is difficult and frustrating DSS is unreliable Information provided hy DSS is not accurate nor timely

Average

S.D.

3.3

I.1

2.‘) 2.x

0.7 0.7

2.x

0.7

2.7 2.6 2.6 2.6

0.0 0.7 0.X 0.7

2.6 2.5

0.X 0.8

2.3

0.6

Average

S.D.

3.x

1.1

3.6

I .o

3.5

I .o

Problems

3.4

0.8

3.4

I .o

3.3

I .o

3.3

0.‘)

3.3

I .o

3.2

I.0

Responses to the eleven DSS use problems are summarized and ranked based on their average scores in Table 13. Only one item received an average score of 3 or higher - DSS development requires too much effort with no immediate results. Since all other items received 3 or less, they do not constitute major problems with DSS use. The lack of major problems with DSS use is consistent with the high degree of satisfaction previously reported (82%).

3.2

1.2

3.0

1.1

2.9 2.7 2.7

0.9 0.6 0.9

2.7

1.o

2.7 2.6

I.1 I.4

2.5

0.‘)

2.5

0.‘)

2.3

0.7

2.1 1.7

0.7 0.7

with DSS use

IMPLEMENTATION STRATEGIES Summaries of ratings on DSS implementation strategies by respondents in 28 firms using DSS are presented in Table 14. The above fourteen items may be placed into four groups. The first consists of the three highest rated items. The second includes the next four items with average ratings between 4.0 and 4.1. The third group comprises the next four items with the average ratings of 3.7 to 3.9. The last three items have an average rating of 3.5 or lower. Items in the first group are all related to the top management: its support is essential to DSS implementation. Items in the second group manifest the need to educate MIS staff and to incorporate DSS implementation into the MIS plan so that required hardware and software could be

C.-c. Hsieh et al. / DSS use in TUOWUI 20s

Information & Manugement Table 14 Evaluation

of DSS implementation

Strategy Provide financial support from top management Provide personnel support form top management Educate top management on DSS Train MIS staff on DSS development Promote DSS in MIS planning Provide DSS hardware and software Educate MIS staff on DSS Appoint internal change agent Establish DSS unit Demonstrate DSS prototypes Promote end-user computing Train users on DSS development Employ external consultant Employ external DSS builder

strategies. Average

S.D.

4.4

Oh

4.4 4.2 4. I 4.1 4.0 3.9 3.9 3.9 3.x 3.7 3.4 3.3 3.1

0.6 0.6 0.8 0.5 0.5 0.X 0.6 0.7 0.5 0.7 1.0 0.8 0.8

made available. Items in the next group show the need to have DSS unit and personnel provide prototypes and promote end-user computing. Lastly, providing user training and seeking external helps seem to be less important as others.

Conclusion This study results

in seven important

findings:

Past research showed that organizations in Taiwan did not use DSS. This study shows that approximately 30 percent have at least one DSS. There is evidence that DSS users in these firms with at least one DSS are indeed sophisticated users: - Over half of them develop DSS on their own. - There is a high percentage interacting with DSS directly. - There is a high percentage of ad hoc usage. Over 80 percent of DSS users are satisfied with their DSS. Most of the users feel that DSS improved decision quality and effectiveness, and that the benefits of DSS outweigh its costs. There are two reasons why an organization is not currently using DSS: lack of DSS technology within the organization and lack of top management support.

Few problems were cited with DSS use. However, DSS development is regarded as time consuming and costly, and payoff is not immediate. The three highest rated DSS implementation strategies are all associated with top management. This is consistent with the reason that DSS is not used - lack of top management support. Various strategies for introducing a change into an organization have been suggested [2;14;15]. Those suggested strategies have been grouped under five approaches: - Convince them of the ben1. Top management efit of the new technology; seek their support. - Make the new technology avail2. Technical able such that employees will adapt it to their use. For example, provide necessary hardware, software, and DSS prototypes to users. - Provide all necessary training, so 3. Training that employees are able to use the technology. For example, train MIS staff or users to develop DSS. - Change organizational struc4. Institutional ture so that it will facilitate the transfer of the new technology. For example, install the DSS unit or appoint the internal change agent, or include DSS implementation into the MIS plan. 5. Information - Provide information relevant to the new technology, such as hiring consultant and exposing MIS staff and users to DSS benefits, etc. Based on this analysis, a possible mix strategy may be a viable choice, coupled with a particular effort to include top management.

References [II Alter, S., “A Taxonomy of Decision Support Systems.” Sloan Management Review, (Fall 19771, 39-56. [2] Daft, R.L., Organization Theory and Design, 2nd ed., West Publishing Company, (1986). 131 Davis, G.B. and M.H. Olson, MIS: Conceptual Foundulions, Structure und Dwelopment, 2nd ed.. McGraw-Hill, (1985). [4] Elam, J.J., G.P. Huber, and M.E. Hurt, “An Examination of the DSS Literature (197%19851,” working paper, Graduate School of Business, University of Texas at Austin, (1987).

206

Research

[Sl Ginzberg, M.A., “Key Recurrent Issues in the MIS Implementation Process,” hf1.S Qm/rrer/~, (June 1981). 477 59. [hl Guimaraes, T.. “DSS for top Executives: Obstacles and Bridges,” Intentatiortul Jourmd of h7fkmcrtion Munugemenr, (March 19X7), 21-35. [7] Hogue, J.T. and H.J. Watson, “Management’s Roles in the Approval and Administration of DSS,” MIS Quurturly. (June 19X3), 15-26. [Xl Hogue. J.T. and H.J. Watson. “Current Practices in the Development of DSS.” Procerding.s of the Internutionul Conference 017 Infi,rmation Systen7, (1984). [9] Lee. C.S. and C.K. Mao, “A Discussion on the Software Development Activities, Methodology, and Environments of Taiwan.” Procaedings of ROC Nationul C’omputer Svmposium, (19X7), 1X7-196.

[IO] Leonard-Barton. D.. “Implementing New Technology: The Transfer from Developing to Operations.” Workrng Puprr of Hunwd Btrsinrss School. No 1160-80. (1980). [I I] Lo, T.D.. MIS mti Deci.Gon Muktng, 3rd ed.. Taipei: Song-Kong Computer Publishing Co., (1987). [12] Lu. M.T., C.C. Hsieh. C.C. Pan. “Implementing Decision Support Systems in Developing Countries.” Industriul Munagement & nutu SwtCw15. 7. (19X9). 21-26. [I31 Lyytinen, K.. “Different Perspectives on Information Systems: Problems and Solutions.” ACM Computer Sttrrvy. (March 19X7), S-36. [ 141 Robbins, S.P., Orgcmization Theo~. Structure Lkstgn, und Applicutwts, 2nd ed.. Prentice-Hall. (19X7). [IS] Robey. D.. Designin!: Orgunizutions. 2nd ed., Irwin, ( 19X0).