Increasing power of hardware and software makes it possible to apply a variety of models for solving management problems. Models are useful presentations of real objects or situations as they reflect the reality without dealing with every detail of it. Even if some aspects of reality are missing in models they still retain enough information to support an effective decision making process. There are two particularly important models in business decision making which are closely related. These are mental and mathematical models.
Mental models are unwritten assumptions and beliefs that people use in thinking process.
They determine what information should be used and how should it be interpreted. This is how mental models play a central role in the acquisition and use of knowledge. Mathematical model is a series of equations or graphs that describe precise relationship between variables. The relationships in the mental model could be stated precisely via mathematical model. They can consist of hundreds of equations which is important to know, because people are unable to pay attention to hundreds of things at the same time.