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1. Introduction
The main task of a manager is to make decisions. To make decisions managers need
information. Information is spread in a great variety of forms: experience of the
managers, judgments and opinions, and mainly information is stored in form of data.
The goal of this course is to learn to extract information contained in data that can
help managers to make better decisions.
The course is a half credit course with 12 sessions. But for the first one, all the
sessions are case discussions.
2. Objectives
3. Learning Outcomes
i. Understand the informational needs a company has and to use the information
companies have in order to use that information for making decisions.
ii. Learn how to produce sales forecasts using past sales data using curve fitting
techniques
iii. Learn regression techniques in order to relate sales to other variables external
to the company.
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IESE Business School Quantitative Methods for Management
v. To use common sense and business experience to understand what are the
most important techniques in each situation
4. Competences
General Competences:
Decision Making
Analytic reasoning
Judgment
Communication
Specific Competences:
To learn the most basics statistics techniques in order to analyze the information a
company has in databases.
To learn how to apply the outcomes of the statistics techniques to make decisions.
5. Content
6. Methodology
The sessions are based on cases which show various applications of quantitative
analysis in business. Each case has a companion Excel file with the corresponding data
set. The students are expected to prepare each case before the class. To help them,
a set of several technical notes, covering the topics mentioned above, is made
available. The notes come with examples which are similar to the cases and
assignments.
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IESE Business School Quantitative Methods for Management
7. Evaluation
- Calculate expected (mean) returns, standard deviations and betas for the
IGBM and each Industry.
- How do the expected returns of these sectors compare with the risk-free
asset yearly return of 14%?
- State the linear relationship between the return of some industry (say,
Metals, Banks and Food) and the return of the General Index.
- What conclusions do you draw from the analysis about the soundness of
investing in each industry?
Hint: To get the annualized return of an investment one has to multiply the
average daily return by the number of days of the year. To get the volatility, one
has to multiply the standard deviation of the daily returns times the square root
of the number of days of the year
- What is the relationship between price and size of different houses? What
is the interpretation of this relationship?
- What is the relationship between price and number of bedrooms? What is
the interpretation of this relationship?
- What is the relationship between price and number of bathrooms?
s Individual assignment (III): Present an analysis of the Hot Dog Pricing case
8 Multiple linear regression (II)
Case: [QMM-02] Hot dog pricing
Data: qmm-02.xls
Answer the questions proposed at the end of the exercise
Regression with lagged variables
Technical note: [QMM-TN-06] Regression with lagged variables
9 Case: HBS 9-171-248 ‘Harmon Foods, Inc.’
Data: HBS 9-171-248 ‘Harmon Foods.xlsx, qmm-tn-06.xls
- Which model do you think makes more sense?
- What do you learn from the coefficients of model selected?
- What improvements would you recommend to the product manager in
terms of timing and amount of promotions?
10 Classification (I)
Technical note: [QMM-TN-04] Classification
Case: [QMM-15] The churn model
Data: qmm-tn-04.xls, qmm-15.xls
In this case we pretend to anticipate what clients that will churn in the future
and to think about what we can offer them for them not to churn.
Develop a profile of the potential churner, i.e. identify the characteristics of
the customers most likely to churn.
Develop a regression model for predict churn
S Team assignment (I): Follow the instructions that will have been given in the
previous session
11 Classification (II)
Case: [QMM-15] The churn model (second round)
In this session we will continue with ‘The churn model’ case. Follow the
instructions given at the end of the previous session.
12 Final session
Case: [QMM-11] Tracking churners at movtel
Data: qmm-11.xls
Answer the questions proposed in the case
Team Project
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