Quantitative Methods [MBA]

2015-2016

Module Module A

Instructor Professor Chase Kusterer

Email chase.kusterer@faculty.hult.edu

Phone / Skype Skype: chase.kusterer

Availability M 14:00-17:00 or by appointment

Class Times and See mycourses.hult.edu/

Rooms

Course Description
This course focuses on solving business problems with the use of data.

The objective of this course is for participants to gain an understanding of how the
utilization of modern computational techniques can lead to better decisions by managers
and entrepreneurs. The course introduces various statistical methods with a lecture and
case-based instruction.

This course aims to differentiate between qualitative and quantitative analysis, to develop
the ability to structure decision-making, and to explore the use of statistical and quantitative
methods to better balance risks.

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Learning Objectives
Key Assessed Learning Outcomes

1. Collect, sort and analyze data and build basic models in Excel to analyze data under
complex business scenarios.

2. Practically apply quantitative concepts in key business areas, including but not limited
to: Strategy, Logistics, Operations, Quality Control and Sales.

3. Read, understand and interpret statistical reports and market research analysis in
order to make better business decisions.

Teaching and Learning

I have personally written a multi-part case to encompass all of the major learning objectives
of this course. This case will be team based, and it will be partly the responsibility of each
team to ensure that all members gain a strong understanding of the mathematical,
statistical, and decision-making content of each part of the case. This will not only improve
your numerical skills, but will also cultivate your leadership and team skills as well.

We will rely heavily on hands-on learning and discussion in the classroom. Heavy numerical
activities and Excel assignments outside the classroom will make-up the remainder of the
coursework. Each part of the case and assignment will be discussed in the classroom or in a
review session to learn collaboratively from peers through case discussion and debates.

Managers are expected to develop and grow capabilities in others; almost every managerial
level job description and above calls for interpersonal and team building skills as well as
excellent written and verbal communication skills. Despite this being a numeric course, by
teaching and learning amongst each other, you will also develop valuable soft skills, which
are important in business to supplement strong quantitative skills.

Method and weighting of assessment

Description of Assessment Weight Due Date

Excel Boot Camp and Data Analysis Prep 30% Oct 25 (Sun)
[Individual]

Sales Forecast [Individual] 40% Nov. 1 (Sun)

Course Project [Team] 30 % Nov. 8 (Sun)

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All assignments are due by 15:00 on the date of the assignment.

Attendance, Participation and Student Responsibilities

Important expectations for Hult students are set forth in the Student Handbook and
summarized below. Please consult the Handbook for more details.

Attendance
Students are expected to attend all scheduled classes, examinations, class presentations,
simulations, exercises, field research visits, discussion groups, plant visits, lectures, and
special programs. An absence for any reason except those qualifying for an excused
absence as described in the Student Handbook will be considered an unexcused absence.

Students who miss more than 20% of scheduled classroom/activity hours because of
unexcused absences (e.g. more than two meetings of a 10-meeting course) will fail the
course. Classes begin promptly according to the published schedule. It is the responsibility
of each student to be in class on time.

Attending group meetings and participating in the assigned study teams are required
components of the program and are considered an important part of the experiential learning
process. Students are expected to participate orally in class and in online forums and team
activities. Hult accommodates students with disabilities, Please see the Student Handbook
for details.

Academic Integrity
Any work submitted by a student in this course for academic credit must be the student's
own work. The Hult policy on plagiarism applies to all work done at the School. In addition,
any failure to abide by examination rules will result in failure of the exam, and may lead to
failure of the course and School disciplinary action. Please consult the Student Handbook for
further details.1

Course Materials and Course Topics

Materials

Required Software
 Microsoft Excel 2013 with Solver and Business Analysis Toolpack add-ons. PC versions are
preferred. If using a Mac it is highly-recommended that a student installs a software that
allows for the use of the PC version of Excel. When conducting advanced statistical tests or
creating macros, the Mac version of Excel tends to work improperly.
 Office for Mac is accepted, with StatPlus installed. See videos on how to install this.

1
These web sites provide helpful guidance regarding plagiarism and how to cite sources:
http://library.acadiau.ca/tutorials/plagiarism/, http://www.plagiarism.org/learning_center/citation.html

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Required Readings
 Industry Background: Decision Trees
 Introduction to Optimization Models, Ivey Publishing
 Industry Background: Optimization
 Oregon Health Insurance Experiment
 Regression Videos [Movie Actors Data Set]
 Industry and Background Note: Multiple Regression and Marketing-Mix Models
 Time Series Techniques write-up, HBP
 Data Scientist: The Sexiest Job of the 21st Century, HBP
 Building an Analytical Culture, HBP
 Censuses: Costing the Count by The Economist
 U.S. Elections Videos

Project
 The project written specifically for this course will be revealed in the first session.

Recommended Videos

 Regression videos by Luis Escamilla

 Baseball videos by Luis Escamilla
 U.S. Election videos by C.P.Grey
 Forecasting Videos by Luis Escamilla

Recommended Reading

 Attractive Faces are Only Average by Langlois and Roggman

 Analytical Probability Distributions with Excel, Ivey Publishing
 What’s The Best Way To Build a Major League Baseball Team? by FiveThirthyEight
 Chapter: Building an Analytical Culture: A Key Element of Embedding Analytics in Your Or-
ganization by HBS
 Optimization Modeling Exercises by Darden Business Publishing

Topics Covered

1. Spreadsheet Modeling

2. Probability

3. Statistics ̶ Census vs. Sampling, Sampling Bias and Sampling Techniques, Surveys

4. Normal Distribution, Confidence Interval and Hypothesis Testing

5. Regression Analysis and Multiple Regression

6. Times Series Forecasting

7. Optimization (Linear Programming)

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8. Decision Tree Analysis

9. Data Collection

Class Preparation

Class Unit 1 Class 1 Time 3 hours

Topic Spreadsheet Modeling

Introduction to Decision Theory

Preparation Watch videos for to Excel Boot Camp:

 Baseball Salaries assignment
 CEOs Quiz

Description In this session we will consolidate the understanding of Excel as a

tool to prepare re-usable templates to perform calculations and
analyze data.

Additionally, we will begin our discussion of decision theory, which

is the foundation of using information to make decisions. In this, we
will review the basic concepts of probability and decision mapping
using tools such as the decision tree.

Class Unit 1 Class 2 Time 3 hours

Topic Decision Theory (Cont.)

Introduction to Optimization

Preparation Industry Background: Decision Trees

Introduction to Optimization Models, Ivey Publishing

Description We will learn about focus groups and surveys as means to gather
market information. The basic concepts of statistics will be ex-
plored in this session, including the mean and standard deviation
and its applications in normally distributed populations.

In this session, we will continue our discussion of decision theory

and decision modelling. We will also begin our discussion on mak-
ing optimal decisions based on information using familiar tech-
niques. In this, we will cover topics such as linear programming
and planning.

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 Class Unit 1 Class 3 Time 3 hours

Topic Optimization (Cont.)

Preparation Industry Background: Optimization

Description This session will focus on advanced linear programming concepts,

giving students the ability to answer such questions as: “How much
should I be willing to pay for one additional hour of labor?”

Tying together the concepts and material we have covered in our

first two sessions, we will dive into ethical decision making based
on information, and the impact our decisions have on the lives and
well-being of others.

Class Unit 2 Class 1 Time 3 hours

Topic Probability Distributions

Confidence Intervals

Preparation

Description In this session, we will dive into the fundamentals of the science of
uncertainty, also known as statistics. We will cover the distribution
of different outcomes and use this information to improve upon our
foundation of making decisions based on information.

Class Unit 2 Class 2 Time 3 hours

Topic Hypothesis Testing

Linear Regression Analysis

Preparation Oregon Health Insurance Experiment

Regression Videos [Movie Actors Data Set]

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 Class Unit 2 Class 2 Time 3 hours

Description We will apply the concepts learned on normal distribution to draw

reliable conclusions about a population based on a valid and rele-
vant sample. We will apply the concept of hypothesis testing in
quality control.

In this session we will explore the concept of correlation. We will

analyze data and the relationships among different variables, and
we will use the predictive power of the data to make conclusions
about values not part of the sample. We will apply the concept of
hypothesis testing within the context of significance level to con-
clude whether or not the relationship between two variables is sta-
tistically significant or not.

Class Unit 2 Class 3 Time 3 hours

Topic Linear Regression Analysis (Cont.)

Preparation Industry and Background Note: Multiple Regression and Market-

ing-Mix Models

Description We will expand further the concept of regression analysis, includ-

ing testing for non-linearity and adjusting the input of non-linear
relationships into a linear regression analysis.

Class Unit 2 Class 4 Time 3 hours

Topic Introduction to Generalized Linear Models

Introduction to Time Series Forecasting

Preparation Time Series Techniques write-up, HBP

Description In this session we will start plotting time sequenced data points to
understand the application of previous topics learnt in the course in
forecasting continuing trends.

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 Class Unit 3 Class 1 Time 3 hours

Topic Data Collection

Preparation Data Scientist: The Sexiest Job of the 21st Century, HBP

Description In this session, we will dive into one of the most essential areas of
research: collecting data in an appropriate manner. This discussion
will include concepts such as sampling bias and survey design.

Class Unit 3 Class 2 Time 3 hours

Topic Statistics and Sampling

Preparation Censuses: Costing the Count by the Economist

U.S. Elections Videos

Description This session will continue on what we have learned in data collec-
tion and begin our discussion on sampling. We will address such
topics as sample size, margin of error, false positives, and false
negatives.

Class Unit 3 Class 3 Time 3 hours

Topic Statistics and Sampling (Cont.)

Preparation Building an Analytical Culture, HBP

Description In the final class of the course, we will leverage on the enhanced
skills developed to address information-based situations to develop
proper data visualizations. We will also wrap up our discussion on
sampling. We will also briefly discuss the world’s ever-increasing
focus on analytics and what it means for management.

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 Appendix: Assignments and Rubrics
In this course, students are evaluated by the following means of assessment:

Assignment Excel Bootcamp and Data Analysis Prep

Description Follow the videos recorded by the instructor to analyze and learn
about the salaries of Baseball players. Activate Data Analysis
Toolpak (PC users) or install StatPus (Mac users) as we will heavi-
ly use it during the long-weekend course. Prepare pivot tables to
learn how to analyze data faster
Run basic Descriptive Statistics, and build histograms and pivot
tables to analyze the CEOs dataset. Answer the corresponding
quiz.

Learning Build basic models in Excel in order to analyze data under complex
Outcome business scenarios
Assessed

Component Needs Improvement Pass High Pass

Did not complete all Completed most steps Completed all steps as
steps as per the Base- as per the Baseball per the Baseball Sala-
Data Analysis Prep ball Salaries Instruc- Salaries Instructional ries Instructional Vide-
tional videos. Did not videos. Activated Data os. Activated Data
activate Data Analysis Analysis Toolpak or Analysis Toolpak or
Toolpak. StatPlus. StatPlus.

Analysis had more Analysis had only one Analysis had no circu-
Data Analysis of CEO than one more circular circular reference of lar references of #N/A,
Salaries Excel File #1 references: #N/A, #N/A, #DIV/0, or #REF. #DIV/O or #REF.
#DIV/O or #REF.
Missing descriptive There is either a de- There is a descriptive
Data Analysis of CEO statistics table, missing scriptive statistics table statistics table, a histo-
Salaries Excel File #2 histogram, or missing or a histogram, and gram, and all quiz an-
clearly labeled names more than 75% of all swers are clearly la-
in the pivot table or the quiz answers are beled as a name in the
worksheet. clearly labeled on the pivot table or work-
pivot table or work- sheet.
sheet
Less than 50% of all More than 50% of all All questions in the
questions in the CEO questions in the CEO CEO Salaries quiz are
Salaries quiz are an- Salaries quiz are an- answered correctly,
swered correctly, there swered correctly, there there is a descriptive
Overall is no descriptive statis- is a descriptive statis- statistics table, and
tics table, and less than tics table, and at least each quiz answer is
75% of all quiz ques- 75% of the quiz an- clearly labeled as a
tions are answered cor- swers are clearly la- name on the pivot ta-
rectly. beled as a name on ble. At least one histo-
the pivot table or quiz. gram is present.

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 Assignment Sales Forecast

Description Answer the numeric questions of specific forecasts methods,

answer the question behind trend and seasonality and, pro-
duce the most accurate possible monthly sales forecast for
your given industry and market
Learning Collect data and build basic models in Excel in order to analyze
Outcome that data under complex business scenarios.
Assessed

Component Needs Improvement Pass High Pass

Accurately answered Accurately answered all
Sales Forecast questions none or only one of the Accurately answered all the the numeric questions
numeric questions numeric questions of at about R^2, RMSE, Sea-
about R^2, RMSE, Sea- least 2 of the following: sonal Factors and Desea-
sonal Factors and R^2, RMSE, Seasonal Fac- sonalized Sales.
Deseasonalized Sales. tors and Deseasonalized
Sales.

Did not accurately an- Accurately answered ques- Accurately answered

swer questions about tions about either trend or questions about both
Questions on Trend and either trend or season- seasonality, but not both. trend and seasonality.
Seasonality ality. Stay on a superfi- The write-up goes beyond The write-up provides
cial level, while it does only stating facts about insights relying on the
mention trend or sea- trend and seasonality, in- data and also on other
sonality from the as- stead it offers insights that external sources properly
signed industry, the are useful for business de- referenced. Those in-
facts are not accurate cision making. sights are powerful and
or are too basic with- unique, proving elegant
out providing insights. and complex analysis of
the data that it was not
originally obvious. Close,
or even better, than what
a financial analysis in the
assigned industry would
produce.
Forecast is not close to
Sales Forecast being accurate over the Forecast is reasonably ac- Forecast is extremely
next 12 months curate over the next 12 accurate over the next 12
months months.

Level of comprehen- Adequate comprehension High level of evidence

sion evidence is below of statistics and their appli- showing comprehension
standard. cation and the ability to apply
Overall the concepts.

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 Assignment Course Project

Description Case encompassing all aspects of what we learned during the

course including optimization, sampling consumer behavior and
metrics. Around consumer tastes related to products sold in a large
chain cinema in China

Learning Practically apply quantitative concepts in key business areas, in-

Outcome cluding but not limited to: Strategy, Logistics, Operations, Quality
Assessed Control and Sales.

Deliverables Each team will be required to submit weekly checkpoints. These

checkpoints will not be graded, but will serve as instruments to
track progress throughout the project.

The final deliverable shall consist of a/an:

 15-20 page, double-spaced analysis report in A.P.A. format
 Excel file that is easily interpreted and well-organized
 Document containing all supporting and reference materials

Component Needs Improvement Pass High Pass

Organization and Writing needs outside support. Paper is organized and clear. Paper demonstrates concise and
Clarity The main ideas are getting lost Errors do not detract from consistent writing. Transitions be-
as a result of the grammar and overall ideas. Could have used tween ideas are handled well.
spelling errors. better transitions between ide- Formatting is appropriate and
as. Some grammar or spelling writing is free of grammar and
errors. spelling errors.

Quantitative One or two quantitative con- All calculations are accurate, All calculations are accurate and
Calculations cepts were calculated and/or but interpretations could be interpretations show that the
interpreted incorrectly. improved. team has a strong understanding
of the quantitative concepts.

Issue Analysis The level of analysis could use Presents an adequate analysis Presents an insightful and thor-
better framing and more depth. of most of the issues identified, ough analysis of all identified is-
Factual and/or computational but lacks depth in some areas. sues. Includes all necessary
support for the analysis is omit- Is missing some necessary cal- calculations.
ted. culations.

Action Recommen- The recommended course of Recommended course of action Recommended course of action
dations action could use more connec- is appropriate to address major has strong arguments based in the
tions to the identified issues, issues, and is linked to the anal- analysis and issues and includes
and the addition of one or ysis. Some anticipated conse- anticipated consequences and al-
more anticipated consequences quences and alternatives are ternatives.
or alternatives would strength- included.
en the plan.

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Use of Course Con- Makes only a few, if any, con- Demonstrates sufficient com- Demonstrates complete command
cepts nections between identified mand of tools and concepts of tools and concepts from the
issues and concepts from from the course. Makes some course. Makes appropriate and
course readings and class lec- connections between identified powerful connections between
tures. issues and the strategic con- identified issues and the strategic
cepts studied in the course concepts studied in the course
readings and class lectures. readings and class lectures.

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