GE Regresses to the Mean

Thirty years ago, GE became the brightest star in the firmament of statistical ideas in business when it adopted Six Sigma methods of quality improvement. Those methods had been introduced by Motorola, but Jack Welch's embrace of the same methods at GE, a diverse manufacturing…

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Examples of Bad Forecasting

In a couple of days, theWall Street Journalwill come out with its November survey of economists' forecasts. It's a particularly sensitive time, with elections in a few days and President Trump attacking the Federal Reserve for for raising interest rates. It's a good time to…

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Historical Spotlight: Risk Simulation – Since 1946

Simulation - a Venerable History One of the most consequential and valuable analytical tools in business is simulation, which helps us make decisions in the face of uncertainty, such as these:   An airline knows on average, what proportion of ticketed passengers show up for a…

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