Data Analysis & Decision Making

Albright, Winston

The 7^th edition, released in late Spring 2019, is similar to the 6^th edition. The following features are new:

· Chapter 1 now includes an introductory section on spreadsheet modeling. This provides business examples for getting students up to speed in Excel and covers such Excel tools as IF and VLOOKUP functions, data tables, goal seek, range names, and more.

· Chapter 4, Probability and Probability Distributions, and Chapter 5, Normal, Binomial, Poisson, and Exponential Distributions, have been shortened slightly and combined into a single Chapter 5, Probability and Probability Distributions. This created space for the new Chapter 4 discussed next.

· The chapters from the 6^th edition on Data Mining and Importing Data into Excel have been reorganized and rewritten to include an increased focus on the tools commonly included under the Business Analytics umbrella. There is now a new Chapter 4, Business Intelligence Tools for Data Analysis, which includes Excel’s Power Query tools for importing data into Excel, Excel’s Power Pivot add-in (and the DAX language) for even more powerful data analysis with pivot tables, and Tableau Public for data visualization. The old online Chapter 18, Importing Data into Excel, has been eliminated, and its material has been moved to this new Chapter 4.

· The 7th Edition is completely compatible with the latest versions of Excel (Excel 2016, Excel 2019, or Excel 365), and all screenshots in the book are from the latter. However, because the changes from previous versions are not that extensive for Business Analytics purposes, the 7th Edition also works well even if you are still using Microsoft Office 2013, 2010, or 2007. Also, recognizing that many students are now using Macs, we have attempted to make the material compatible with Excel for Mac whenever possible.

· Numerous problems have been modified to include the most updated data available. In addition, the DADM 7e Problem Database.xlsx file provides instructors with an entire database of problems. This file indicates the context of each of the problems and shows the correspondence between problems in this edition and problems in the previous edition.

· There is more emphasis in this edition on implementing spreadsheet calculations, especially statistical calculations, with built-in Excel tools rather than with add-ins. For example, there is no reliance on Palisade’s StatTools add-in in the descriptive statistics chapters 2 and 3 or in the confidence interval and hypothesis testing chapters 8 and 9. Nevertheless, Palisade’s add-ins are still relied on in chapters where they are really needed: PrecisionTree for decision trees in Chapter 6; StatTools for regression and time series analysis in Chapters 10, 11, and 12; @RISK for simulation in Chapters 15 and 16; and StatTools and NeuralTools for logistic regression and neural networks in Chapter 17.

· Although it is not an “official” part of the book, Albright wrote a DADM_Tools add-in for Excel (Windows or Mac), with tools for creating summary stats, histograms, correlations and scatterplots, regression, time series analysis, decision trees, and simulation. This add-in provides a “lighter” alternative to the Palisade add-ins and is freely available at https://kelley.iu.edu/albrightbooks/free_downloads.htm. (Some of the solution files available to instructors have been created with this add-in.)

Note for StatTools users: One user recently complained that several example and solution files in Chapter 3 (and maybe Chapter 2?) of the 7^th edition provide different values for medians and other percentiles than they obtain with StatTools. (Note that my solutions in the 7^th edition don’t use StatTools. They use built-in Excel functions: MEDIAN, QUARTILE, and PERCENTILE.) Anyway, the statistics literature provides several slightly different methods for calculating percentiles, including the median, and StatTools lets you choose which of these you prefer. You can make this choice from Application Settings under the Utilities dropdown. I doubt that many users will purposely choose a method other than the StatTools default, but such a choice could lead to slightly different answers. In any case, the differences should be negligible for all practical purposes. By the way, the reason for slightly different methods is due to small data sets. For example, the 10^th percentile is not clearly defined (and probably not even relevant) in a data set with only 7 observations!

Tables of contents:

· First edition

· Second edition

· Third edition

· Revised Third edition

· Fourth edition

· Fifth edition

· Sixth edition

· Seventh edition

Errata:

· First edition

· Second edition

· Third edition

· Revised third edition

· Fourth edition

· Fifth edition

· Sixth edition

· Seventh edition

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Send e-mail to albright@indiana.edu

Albright and Winston are both retired from the Kelley School of Business, Indiana University, Bloomington.

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Updated: 12/1/2020