Expert System Software in Small Business Decision Making (1989)

The use of computers by entrepreneurs in small business is increasing, and both hardware and software are becoming more sophisticated. The research reported in this article focused on computerized improvements to the decision-making process in small business. Specifically, the impact of an expert system in a small business was tested. Answers to the following questions were sought: Are expert systems feasible for a small business? is the range of possible managerial needs which an expert system could satisfy? Among those needs, which would be the most important? COMPUTERS IN SMALL BUSINESS Small businesses now have greater access to sophisticated computer technology than ever before. Most applications, however, are restricted to basic, low-level data storage and transaction processing.1 Support systems for managerial decision making have not yet made much of an impact on entrepreneurial activities, although several academic studies have documented the use of decision support systems to model break-even points, plan material requirements, and supply cost accounting information.4 Currently computers are used for word processing, handling mailing lists, budgeting, accounting transaction processing, customer records, and other management tasks which are inexpensive to automate, maintain, and control.5 Owner/managers, however, are eager to use new applications, primarily because the exploitation of opportunities afforded by microcomputer decision tools may be a key to gaining competitive advantage in their markets. These tools will be used in the decision process rather than the monitoring and control processes. Software already exists to facilitate sales forecasts, new product development, factory location, financial planning, material requirements decisions, etc>. These new decision aids are usually referred to as decision support systems (DSS). Whereas EDP software tools answer What is? kinds of questions, DSSs answer What if? and Analyze my options requests. A DSS employs data, stochastic models, and econometric models to develop analyses for decision makers. It does not necessarily provide solutions to problems, but rather is designed to improve the quality of inferences, judgments, and choices of owner/managers who often must operate in an environment in which possible solutions are not always apparent. A DSS is an aid to informed choice, but it does not make choices for the entrepreneur. EXPERT SYSTEMS The function of an expert system (ES) is to mimic the expertise of an expert or a small group of experts as it is used to solve a specific problem, usually involving diagnosis or prescription. While they have been used in medicine, engineering, and manufacturing for a decade, only recently has software been developed which would allow expert systems to be constructed quickly and at low cost in small business. Although ESs can make attributions, predictions, reasoned inferences and the like, their general function is to give either direct or implied advice to managers who have a problem to solve or a decision to make.8 Within this general context, and given the variety of roles experts play, the full range of specific uses of ESs in organizations has not yet become clear. They probably will be used for most of the following: Provide expert advice when an expert is not available or is unwilling to risk giving advice. In one system, for example, a hotel clerk can use an ES to advise a customer without having to waste the customer's time while the clerk telephones an expert about an important problem. Simplify the task of the expert by saving time and mental energy. Complement experts so that the user will access an ES and use its advice and reasoning as a starting point in his or her consultation with an expert. …