Minor in Business Analytics Ilhyung Kim Decision Sciences

Minor in Business Analytics Ilhyung Kim Decision Sciences, WWU

Minor in Business Analytics q q q Commenced in Fall 2016 Designed to provide students with a solid foundation in business analytics. Analytics defined by INFORMS (Institute For Operations Research and Management Science) in June, 2012 • “The scientific process of transforming data into insights for the purpose of making better decisions. “ Consists of five courses, 20 credits • Three cores – one from each of the three fundamental areas of analytics: descriptive, predictive, and prescriptive • Two electives Admission and Declaration Process • For details on eligibility and application, visit the DSCI website. 2

Three Fundamental Areas in Analytics q Descriptive Analytics: What is going on now? • Involves gathering and describing data. • MIS 422 Business Intelligence and Analytics q Predictive Analytics: What would happen next? • Uses the patterns and relationships in data to predict the future. • DSCI 407 Predictive Analytics for Business MIS 434 Applied MIS 435 Managerial Analytics Text Analytics q Prescriptive Analytics: What should we do then? • Suggests a course of action. • OPS 462 Management Science OPS 467 Logistics Modeling & Analysis 3

DSCI 407 Predictive Analytics Ilhyung Kim Decision Sciences, WWU

Example of Predictive Analytics (1) q Wage Data q Predicting wage based on age, year, and education level wage = f(age, year, education) + e 5

Example of Predictive Analytics (2) q Stock Market Data q Predicting today’s direction based on the percentage changes in S&P for the past five days direction = f(lag 1, lag 2, …, lag 5) + e 6

Example of Predictive Analytics (3) q q A simulated data set with 150 observations in two-dimensional space K-means clustering examples when K = 2, 3, and 4 7

DSCI 407: Textbook and Software Program q Textbook • An Introduction to Statistical Learning with Application in R by G. James, D. Witten, T. Hastie, and R. Tibshirani, 2013. q Statistical Programming Language R • Powerful and flexible enough to implement virtually all statistical models • The language of choice for academic statisticians New approaches often become available in years before they are incorporated in commercial packages. • As of 10/6/18, the CRAN (Comprehensive R Archive Network) package repository features 13, 134 packages (up from 11, 745 as of 10/6/17). Over 100 packages were added every month! • R is free! 8