Business decisions are often complex. While intuition may help develop some basic insights, decision makers typically employ models to support business decisions. Data are analyzed and results are interpreted in the business context.
Here, we will discuss different ways to classify models so that we can select the appropriate situations given various business situations. Overall, there are four different perspectives:
- the type of data in the model
- the random nature of the model
- the tangibility of the model
- whether the assumption of the model is known