After reading the article in the below web link on the applications of a simple linear regression model, please post your comments/ thoughts to this discussion forum in Module 2.
The web link of the article: https://hbr.org/2015/11/a-refresher-on-regression-analysis (Links to an external site.)
Due: By 11:59 p.m. (U.S. Eastern Time) on Saturday of Week 2.
correlation1
Redman says that some managers who are new to understanding regression analysis make the mistake of ignoring the error term. This is dangerous because they’re making the relationship between something more certain than it is. “Oftentimes the results spit out of a computer and managers think, ‘That’s great, let’s use this going forward.’” But remember that the results are always uncertain. As Redman points out, “If the regression explains 90% of the relationship, that’s great. But if it explains 10%, and you act like it’s 90%, that’s not good.” The point of the analysis is to quantify the certainty that something will happen. “It’s not telling you how rain will influence your sales, but it’s telling you the probability that rain may influence your sales.”
The last mistake that Redman warns against is letting data replace your intuition.
“You always have to lay your intuition on top of the data,” he explains. Ask yourself whether the results fit with your understanding of the situation. And if you see something that doesn’t make sense ask whether the data was right or whether there is indeed a large error term. Redman suggests you look to more experienced managers or other analyses if you’re getting something that doesn’t make sense. And, he says, never forget to look beyond the numbers to what’s happening outside your office: “You need to pair any analysis with study of real world. The best scientists — and managers — look at both.”
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Amy Gallo is a contributing editor at Harvard Business Review, cohost of the Women at Work podcast, and the author of two books: Getting Along: How to Work with Anyone (Even Difficult People) and the HBR Guide to Dealing with Conflict. She writes and speaks about workplace dynamics. Watch her TEDx talk on conflict and follow her on Twitter.
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A Refresher on Statistical Significance
It’s too often misused and misunderstood.
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