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50 Part I • Decision Making and Analytics: An Overview

Predictive
Statistical Analysis and
Data Mining

Reporting
Prescriptive
Visualization Management Science
Periodic, ad hoc
Reporting Trend Analysis Models and Solution

Prescriptive
Management Science
Models and
Predictive Solution
Statistical Analysis
and
Reporting
Visualization Data Mining
Periodic,
ad hoc Reporting
Trend Analysis

Figure 1.5 Three Types of Analytics.

a specific marketing campaign or ongoing service/product offerings. When an organization
has a good view of what is happening and what is likely to happen, it can also employ
other techniques to make the best decisions under the circumstances. These eight levels of
analytics are described in more detail in a white paper by SAS (sas.com/news/sascom/
analytics_levels.pdf).
This idea of looking at all the data to understand what is happening, what will
happen, and how to make the best of it has also been encapsulated by INFORMS in
proposing three levels of analytics. These three levels are identified (informs.org/
community/analytics) as descriptive, predictive, and prescriptive. Figure 1.5 presents
two graphical views of these three levels of analytics. One view suggests that these three
are somewhat independent steps (of a ladder) and one type of analytics application leads
to another. The interconnected circles view suggests that there is actually some overlap
across these three types of analytics. In either case, the interconnected nature of different
types of analytics applications is evident. We next introduce these three levels of analytics.

descriptive analytics
descriptive or reporting analytics refers to knowing what is happening in the
organization and understanding some underlying trends and causes of such occur-
rences. This involves, first of all, consolidation of data sources and availability of

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