Homework Description
Each “Homework Group”, you must individually provide clear, pointed, and well-supported analysis of one of the following relationships between company choice variables and outcomes (organized by category). Using this analysis, you must then make recommendations that will meet your company’s long-run strategic objectives. The five relationships available are:
- The Bottom Line: The effect of price changes on profits
- Sales and Marketing: The effect of changes in advertising budget on sales
- Human Resources: The effect of salary changes on employment longevity
- Customer Service: The effect of help desk employment level on number of complaints
- Production: The effect of machine maintenance rates on proportion of faulty units
Each person will be responsible for submitting his/her own individual project. A written analysis, between 1000 and 1800 words of text, concerning one of the above relationships. I will provide 5 (fabricated) datasets, each one on each relationship above (Bottom Line, Sales and Marketing, Customer Service and Production) containing sufficient information to conduct analysis for the question you have chosen to address individually, along with five Word documents having notes for each assignment. (In case you have less than five people in your Homework Group, you should each one choose one of the relationships you think is most pertinent and interesting for the company you have been assigned to as long as each member take a different assignment).
The data is to be used in conjunction with your own company research to conduct your analysis. Note that your company research should not include any collection of raw data, and all direct technical analysis should be done using the data I provide. To be concrete, your company research should be used to determine things like: relevant company history, strategic objectives, market and market competitors, organizational structure, etc. Then, treating the data I provide as actual data provided to you from the company, your individual project should combine technical analysis of those data with your company research.
Finally, note that it is not enough for your analysis to simply report the effect of one variable on another. You must clearly explain what you did and how you did it in a way that a smart individual with limited econometric knowledge will understand, following the methods and reasoning lines you have learned in this course. You then must use this measured effect to draw conclusions and formulate a recommendation in the context of your company’s long-run strategic objectives. For the written project, your recommendation should only take into account your analytical findings– this is NOT a group project. The groups are solely for purpose of me disseminating the data.
A few notes concerning the project:
- The companies you will be analyzing are generally large. Therefore, to keep the project requirements reasonable, you will be focusing on a narrow subset of your chosen company’s business.
- The number of observations may seem inflated in some cases. For example, you may have several hundred observations for employee offices when the company clearly has fewer than that. This won’t materially affect your analysis or assessment, and is only done to make the analysis more meaningful in this controlled environment.
- You will be evaluated on quality of your introduction – including your institutional background, how you connected the company’s product with the analysis, objectives, motivation for the analysis any other relevant background information. Technical execution – quality of your econometric analyses: how did you go about choosing your model specification and justified your choices of model, functional form, improvements in the model. Technical Discussion – how are your choices connected to the material discussed in the course, logical justification and discussion of your results, interpretation of results. Presentation – visuals, tables, graphs of professional quality, informative, relevant to the analysis. Conclusion – including what is your recommendation, possible caveats in the analysis. Relative weights: Introduction(x 1), Technical Execution (x 3.5) Technical Discussion (x 3.5), Conclusion (x 1) and Presentation (x 1).
- Your tables and graphs and other visuals should be part of an Appendix and referenced in your text, so the word limit -1000-1800 does not include the Appendix. However keep in mind concision and focus. Too many results, tables, aids can harm the quality of the discussion, confuse the reader.
- You will notice that instructions/guidance and the Word documents notes are general, and somewhat, vague. This is intentionally done to mimic the business analytics demands you may face in your work environment where you are tasked with conducting an econometric analysis for the data the company provides you.
- Submissions must also include a Stata do file which can be used to replicate the results presented in the report. Ideally, I should be able to run the do file on my machine with no adjustments.