Wednesday, February 19, 2003

Today, we had a special class: a joint session to cover an interdisciplinary case.  We looked at the issues surrounding Adidas's support of the Euro 2000 football tournament.  Three professors from Marketing, Economics, and Organizational Behavior reviewed the case, which revolved around the potential threat of an NGO to the Adidas brand using the standard "globalization hurts the poor" messages. Two things were memorable in this session.  The first was that our economics professor, Randy Heeb, asked us why the footwear industry was structured the way it was - with production factories in Pacific Rim countries; Nike and Adidas as the branding and marketing entities, and Foot Locker-type stores as the retail distribution channel.  Essentially, it has to do with risk and margin: high-risk, low-margin production is owned by Asian locals, while the more profitable, economies-of-scale branding assets are owned by the apparel giants.  It's a fun exercise to look around you and try to figure out why each industry is laid out the way it is.  Perhaps I'll think about the industry of business education next... The other interesting event was simply watching three high-powered professors share the spotlight with each other for ninety minutes.  Clearly, each is more comfortable on their own, and their "change of control" handoff processes were a tad awkward; a rare glimpse at the unpolished side of academic stars. 8:29:15 PM    comment []

Jack Soll's Quotes of the Day from Applied Statistics [continuing a long-running theme in class that many examples involve monkeys, at our 10:15am class] "Ah, look!  We're talking about monkeys and you are eating a banana." [after running a regression analysis helping to predict a monkey's weight from his height] "This equation only works within a certain range... obviously a monkey cannot have negative weight."  'Negative weight' has been another long-running theme in the class. [commenting on how you should be sceptical when presented with a statistically significant relationship] "This is why you must be careful.  You don't know that I started with a million variables; I'm trying to trick you." [after intense analysis on a set of student data revealed that one particular year's group from a certain region of the world was slightly less qualified in English than usual] "I would like to test other years' data sets to see if this has improved, but now the MBA office is very hesitant to give me more data, because I have been causing lots of problems." [when figuring out if you should keep two of your forecasting staff, when their predictions have a correlation of 0.77] "This is a bit like asking McKinsey and BCG at the same time: you'll get the same opinion." [after determining that you should fire the best-performing of your three forecasting analysts, because using the other two together gives the best overall result (because their predictions are negatively correlated)] Lucky: "I think it's depressing that you would fire your best forecaster."  Jack: "OK, you can go discuss it in OB [organizational behavior]." 6:44:12 PM    comment []