You will need to complete the following items before you start your five tasks for this case study. An example of a a completed case study is attached.
- Check out Figure 10-3 – attached.
- Read attached pages 363–363.
- Print out Figure 10-3, and find the estimated median tenure. (Hint: See Figure 10-2 on the previous page.)
Task 1: (a) What is your estimated median tenure? (b) How did you generate it? (c) How long has our longest tenured customer been with the company? (d) What would you tell a senior manager with little or no statistical background is its meaning (three or four sentences at most)?
Task 2: Satisfy yourself that the original distribution data should be approximately as follows. Percent Survival Tenure (Years)
Describe the method used to satisfy yourself.
Task 3: Reread the paragraph above Figure 10-4. The author talks about the 10-year average lifetime of each group as being 6.1 and 3.7 years. It might appear that he just pulled the numbers out of the air, but he actually described how to calculate them earlier in the paragraphs above and below Figure 10-3. We are going to duplicate this approach using Excel. Use the Excel file tenure.xlsx in Files. Check out the first set of columns. It represents the curve in Figure 10-3. Using the same method you used to satisfy yourself in Task 2, fill in the two empty columns and compute the average customer lifetime during the first 10 years. Don’t worry if you did not get exactly the same numbers as the author. Your method was an approximation. Note that the units in Figure 10-4 are not really months (that’s just a label) but are in fact years. You might find Figure 10-2 easier to work with than Figure 10-4.
Task 4: Generate a chart with both survival curves (high end and regular) on it, and embed it in your Word document.
Task 5: Write a paragraph describing these results that your senior manager mentioned above would understand.