MSL 5080, Methods of Analysis for Business Operations 1 Course Learning Outcomes for Unit II Upon completion of this unit, students should be able to: 2. Distinguish between the approaches to determining probability. Reading Assignment Chapter 2: Probability Concepts and Applications, pp. 23–32 Unit Lesson As you know, much in the world happens in amounts we can count—some in discrete numbers (1 item, 2 items, 3 items, never with a fraction of an item) or continuous ones (3.75 hours, 2.433333 hours) that could be any fraction within a given range. Because of this, one can either calculate or estimate probability, which will be the focus of this unit. Probability Who wants to calculate probability? Businesses (including farmers and ranchers raising crops and livestock), governments, and anyone wanting to quantify risks in life will calculate probability. This includes people involved in gaming as well. As you read, the textbook illustrates probability with coin tosses where the outcomes are just two possible ones—heads or tails (Render, Stair, Hanna, & Hale, 2015). You may know that gamblers have more complex probability problems to estimate a solution for—as in Texas Hold ‘Em, where a cardholder may be calculating whether the remaining players are holding higher hands than his or her own. There are answers available to the cardholder’s dilemma as well. Probability is “a numerical statement about the likelihood that an event will occur” (Render et al., 2015, p. 24). Mathematics can model this for us. Because some mathematical terms are equal to others, you can state the formulas for certain probabilities as you see in Chapter 2 of the textbook. In the physical world, the probability of anything is either 0 (cannot happen), 1 (100% chance of happening), or some fraction in between 0 and 1 (has a little/some/even/probable chance of happening). As something has to happen in every trial, the probabilities added up for identical trials equal 1 for the series. A tossed coin has a 50% or .5 chance of coming up heads, and the same 50% or .5 chance of coming up tails, but something will come up when the coin is tossed—or, .5 + .5 = 1. So for probability of the event = P(event): 0 ≤ P(event) ≤ 1 The probability to be calculated is in that range somewhere! Now, how do you find it? Here are two types of approaches that fit what happens, the objective approach and subjective approach. Types of Probability  Objective approach: The objective approach (when you can use numbers to calculate probability directly) uses two common methods (Render et al., 2015): 1. The relative frequency method is used when you know how often things happen (as in the coin example above, if you know how many times it was tossed), and 2. The classical or logical method is used when you know often things should happen (e.g., the number of ways a coin will land, heads or tails, without knowing the numbe.

1. MSL 5080, Methods of Analysis for Business Operations 1
Course Learning Outcomes for Unit II
Upon completion of this unit, students should be able to:
2. Distinguish between the approaches to determining
probability.
Reading Assignment
Chapter 2: Probability Concepts and Applications, pp. 23–32
Unit Lesson
As you know, much in the world happens in amounts we can
count—some in discrete numbers (1 item, 2
items, 3 items, never with a fraction of an item) or continuous
ones (3.75 hours, 2.433333 hours) that could be
any fraction within a given range. Because of this, one can
either calculate or estimate probability, which will
be the focus of this unit.
Probability

2. Who wants to calculate probability? Businesses (including
farmers and ranchers raising crops and livestock),
governments, and anyone wanting to quantify risks in life will
calculate probability. This includes people
involved in gaming as well. As you read, the textbook
illustrates probability with coin tosses where the
outcomes are just two possible ones—heads or tails (Render,
Stair, Hanna, & Hale, 2015). You may know
that gamblers have more complex probability problems to
estimate a solution for—as in Texas Hold ‘Em,
where a cardholder may be calculating whether the remaining
players are holding higher hands than his or
her own. There are answers available to the cardholder’s
dilemma as well.
Probability is “a numerical statement about the likelihood that
an event will occur” (Render et al., 2015, p. 24).
Mathematics can model this for us. Because some mathematical
terms are equal to others, you can state the
formulas for certain probabilities as you see in Chapter 2 of the
textbook. In the physical world, the probability
of anything is either 0 (cannot happen), 1 (100% chance of
happening), or some fraction in between 0 and 1
(has a little/some/even/probable chance of happening). As
something has to happen in every trial, the
probabilities added up for identical trials equal 1 for the series.
A tossed coin has a 50% or .5 chance of
coming up heads, and the same 50% or .5 chance of coming up
tails, but something will come up when the
coin is tossed—or, .5 + .5 = 1.
So for probability of the event = P(event):
0 ≤ P(event) ≤ 1
The probability to be calculated is in that range somewhere!

3. Now, how do you find it? Here are two types of
approaches that fit what happens, the objective approach and
subjective approach.
Types of Probability
jective approach (when you can
use numbers to calculate probability
directly) uses two common methods (Render et al., 2015):
1. The relative frequency method is used when you know how
often things happen (as in the coin
example above, if you know how many times it was tossed), and
2. The classical or logical method is used when you know often
things should happen (e.g., the
number of ways a coin will land, heads or tails, without
knowing the number of trials, or as a
UNIT II STUDY GUIDE
Determining Probability
MSL 5080, Methods of Analysis for Business Operations 2
UNIT x STUDY GUIDE
Title
better example, the chance of drawing an Ace in an American

4. card deck – P = 4 / 52, or 1/13
= .077).
pproach is used to
assess probabilities when logic cannot be
applied and past trial outcomes are not known; then the
probabilities are assessed subjectively. This
also is done often in society for economic outlooks, weather,
and prices. Opinion polls can be used
for estimating candidate chances, and the Delphi Method (panel
of experts) can be used for the best
judgments likely to be received. (Render et al., 2015). The last
unit (Unit VIII) explores this in more
detail.
Types of Events
With the following methods, you will be able to determine some
probability. A mutually exclusive event is
when a trial is conducted and only one event can occur as the
trial’s outcome (Render et al., 2015). As you
recall from coin tosses, the outcome will be either heads or
tails. Heads and tails are mutually exclusive
because both cannot occur in a single trial.
Intersections: Looking back to the card deck, you can try for an
event that draws a seven and try for an
event that draws a heart, and these are not mutually exclusive
because you could draw a seven of hearts.
Such outcomes that can be in both event “camps,” as this
example is the intersection of the probabilities of
sevens and hearts:

5. P (Intersection of event 7s and event hearts) is written as
P = event 7s ∩ event hearts, or, to substitute,
P (A∩B) = P (AB). So when you multiply the probabilities of
the events that intersected because an
outcome could be both events, you get the probability of the
intersection—the probability that an outcome will
be both events.
Unions: How about all the event possibilities that are in either
outcome and that probability? Events of all
outcomes are called unions. Unions of all events that could be
in either of two outcomes would be written as:
P(A or B) = P(AUB) = P (A) + P(B) – P(AB).
Why subtract out the small probability of the intersection
P(AB)? The reason is that you don’t want to double-
count the events occurring in both outcomes.
Probability Rules
There is one more thing that you will often be asked to do:
determine the probability that an event will occur
(given that another event already occurred), or determine
conditional probability (Render et al., 2015).
Occurring events affect subsequent events, which is why this is
an important truth of mathematics, and it
supports figuring out this phenomenon. Write the probability
that Event A will occur given that Event B already
did as:
P(A│B) = P(AB)

6. P(B)
This is the conditional probability that Event A will occur as
the probability of the intersection of A and B,
divided by the probability of B. Note this, and the following
things you can do because of mathematics:
Probability of the intersection of A and B = P (A∩B) = P (AB)
= P(A│B)P(B)
So if you drew a heart from a deck of cards, what is the
probability that it is a 7, or P(A), given that B, drawing
a heart, already occurred?
P(A│B) = P(AB) = 1/52 = 1/13
P(B) 13/52
MSL 5080, Methods of Analysis for Business Operations 3
UNIT x STUDY GUIDE
Title
If one event will have no effect on another, then the events are
independent of each other. Mathematics tells
us that Event A and Event B are independent if:

7. P(A│B) = P(A)
Which they must be, as you can see you can come up with B all
day long, and A still has the same probability.
And so the intersection of independent events is:
P(A and B) = P(A) P(B)
And this is why with a probability of 50%, or .5, of a coin
showing heads or tails on a toss, the probability of
two heads or two tails on two tosses A and then B (independent
of each other because you can’t come up
both heads and tails) is:
.5 x .5 = .25
With these probability skills, one can offer a variety of
estimates to leaders. Mathematicians and scientists
have pushed these fundamentals to reveal some additional
capabilities:
Bayes’ Theorem
Bayes’ Theorem enables us to add new information to an
existing probability calculation to determine the
updated probability. If A is an event, and A’ is the “other,”
complementary event, then
P(A│B) = P (B│A)P(A) .
P (B│A)P(A) + P (B│A’)P(A’)

8. If the business can afford it, the administrators can keep
running trials to fine-tune the probability estimate. It
may be best to be satisfied with just two or three trials, though.
The differences between solutions may
become too close together to matter, and one can show general
awareness of such probability distributions.
Who finds it useful to calculate probability with the approaches
explored so far? Early in this lesson, reasons
of business and government were mentioned, and those remain
areas that often are in need of gaining an
indication of what might happen. Note that statistical analysis
does not promise to show what WILL happen.
All one can do without prescient powers is figure out what the
chances are of something happening.
Those of you who partake in gaming for leisure may recall that
casinos often forbid counting of cards and
other calculating methods that give guest players a more-than-
usual chance at winning. The usual chance is
that the “House” (casino) has a slight edge in probability of
winning, which is set by the specific rules of the
game or by electronic or mechanical settings of gaming
machines. But as you can see with Bayes’ Theorem
and other conditional probability theories, it is possible to
negate the House advantage if you can (discretely)
calculate probability after seeing a die or the first few cards.
Note also that often what you see in casinos is
not calculation at all but guesswork and a lot of hope! But
casinos and gaming are supposed to be fun.
In this course, you must face the notion that luck and
calculations are two different things. After accepting this,
you are left with just the disturbing afterthought that business
and government leaders may forego statistical
analysis and strive for luck—consciously or unconsciously. This

9. human tendency is part of why the science of
statistical analysis was developed and leveraged to assist
leaders.
Reference
Render, B., Stair, R. M., Jr., Hanna, M. E., & Hale, T. S.
(2015). Quantitative analysis for management (12th
ed.). Upper Saddle River, NJ: Pearson.
MSL 5080, Methods of Analysis for Business Operations 4
UNIT x STUDY GUIDE
Title
Suggested Reading
The links below will direct you to a PowerPoint view of the
Chapter 2 Presentation. This will summarize and
reinforce the information from this chapter in your textbook.
Review slides 4–39 for this unit.
Click here to access a PowerPoint presentation for Chapter 2.
Click here to access the PDF view of the presentation.

10. For an overview of the chapter equations, read the “Key
Equations” on page 53 of the textbook.
Want to see how to solve problems related to this unit? Read the
“Solved Problems” on pages 54–55 of the
textbook (problems 2-1 through 2-6).
Learning Activities (Nongraded)
Nongraded Learning Activities are provided to aid students in
their course of study. You do not have to submit
them. If you have questions, contact your instructor for further
guidance and information.
Complete problems 2-14 through 2-17 on page 58 of the
textbook. Use the answer key (Appendix H) in the
back of the textbook in order to check your answers.
https://online.columbiasouthern.edu/bbcswebdav/xid-
78756607_1
https://online.columbiasouthern.edu/bbcswebdav/xid-
78756150_1
1
Copyright © 2015 McGraw-Hill Education. All rights reserved.
No reproduction or distribution without the prior written
consent of McGraw-Hill Education.
Chapter 8
Creative

11. Strategy:
Planning and
Development
8-2
Creative Strategy and Tactics
• Determines what the advertising message
will say or communicate
Creative strategy
• Determine how the message strategy will be
executed
Creative tactics
8-3
Different Perspectives on Advertising
Creativity
Managers’ perspective
• Advertising is creative
only if it sells the
product
• Ads are promotional
tools used to
communicate favorable
impressions to the
marketplace

12. Creative people’s
perspective
• Creativity of an ad is in
its artistic value and
originality
• Ads are communication
vehicles for promoting
their own aesthetic
viewpoints and
personal career
objectives
8-4
Advertising Creativity
Ability to generate fresh, unique, and
appropriate ideas that can be used as solutions
to communication problems
8-5
Determinants of Creativity
Divergence
Originality
Flexibility
Elaboration
Synthesis

13. Artistic Value
Relevance
Ad-to-consumer
Brand-to-consumer
8-6
Divergence
novel, different, or unusual
2
8-7
Relevance

14. lements of an ad are
meaningful, useful, or valuable to the consumer
-to-consumer relevance - Ad contains execution
elements that are meaningful to consumers
-to-consumer relevance - Advertised brand of
a product or service is of personal interest to
consumers
8-8
Planning Creative Strategy
campaign or advertisement requires a different
creative approach
ting breakthrough advertisements
that get noticed
8-9

15. Creative versus Hard-sell Advertising
Rationalists
• Advertising must
sell the product
or service
Poets
• Advertising must
build an
emotional bond
between
consumers and
brands or
companies
8-10
Young’s Model of the Creative Process
• Gathering raw material and data, and immersing oneself in the
problem
Immersion
• Analyzing the information
Digestion
• Letting the subconscious do the work
Incubation

16. • Birth of an idea
Illumination
• Studying the idea and reshaping it for practical usefulness
Reality or verification
8-11
Wallas’ Model of the Creative Process
• Gathering background information needed to solve the
problem through research and study
Preparation
• Letting ideas to develop
Incubation
• Finding the solution
Illumination
• Refining the idea and analyzing whether it is an appropriate
solution
Verification
8-12
Account Planning

17. information about a client’s:
service and brand
to make an intelligent decision
creative strategy development process
3
8-13
Background Research
-finding techniques
information
client

18. and become familiar with
it
8-14
General Preplanning Input
Gather and organize information on the
product, market, and competition
Analyze the trends, developments, and
happenings in the marketplace
8-15
Product- or Service-Specific
Preplanning Input
Gathering information through studies conducted by the client
on:
• Product or service
• Target audience
Problem detection
• Asking consumers familiar with a product to list all the
aspects they
do not like, provides:
• Input for product improvements or new product development

19. • Ideas regarding which features to emphasize
• Guidelines for positioning brands
8-16
Product- or Service-Specific
Preplanning Input
Psychographic studies
• Construct detailed lifestyle profiles of consumers
Branding research
• Helps gain better insight into consumers and
develop more effective campaigns
8-17
Qualitative Research Input
creative process
ups: Consumers from the target market
are led through a discussion regarding a particular
topic

20. 8-18
Qualitative Research Input
behavior patterns and motivations
ers in
their natural environment
administer
4
8-19
Input Verification and Revision

21. •Evaluate ideas
•Reject the inappropriate
•Refine the remaining
•Give ideas final expression
Objective
•Directed focus groups
•Message communication studies
•Portfolio tests
•Viewer reaction profiles
Techniques
8-20
Verification and Revision
proposed commercial’s visual layout

22. audio soundtrack
8-21
Storyboards and Animatics
8-22
Advertising Campaign
Set of interrelated and coordinated marketing communications
activities that center on a single theme or idea
• Appear in different media across a specified time period
Campaign theme
• Central message communicated in all the advertising and
promotional
activities
• Expressed through a slogan or tagline
Slogan
• Summation line that briefly expresses the company or brand’s
positioning and
the message it is trying to deliver to the target audience
8-23
An Advertising Campaign
Integrated

23. Interrelated Coordinated
In Different
Media
Over a Time
Period
Marketing
Communication
Activities
Centered on a
Theme or Idea
8-24
“ We Must
Protect This
House. I will.”
BMW
“ Just Do It”
Miller
Lite
“Red Bull Gives
You Wings”
Red BullUnder ArmourNike
Advertising Campaign Themes

24. The central message that will be
communicated
in all of the various IMC activities
5
8-25
Criteria for Effective Slogans
8-26
Major Selling Idea
its product or service
d most meaningful appeal to the
target audience
-to-business advertising
8-27
Developing the Major Selling Idea
Using a unique
selling proposition
Creating a brand

25. image
Finding the inherent
drama
Positioning
Approaches
8-28
The Unique Selling Proposition
(USP)
Must be
unique to
this brand or
claim; rivals
can't or don't
offer it
Unique
Buy this
product/serv
ice and you
get this
benefit
Benefit
Promise
must be
strong
enough to

26. move mass
millions
Potent
8-29
Unique Selling Proposition
consumer
millions
8-30
Creating a Brand Image
strong, memorable identity for a brand
have cultural meaning

27. associations and feelings
6
8-31
Inherent Drama
consumer purchase it
those benefits
8-32
Positioning
place in the consumer’s mind
multiple brands competing in the same market

28. 8-33
Contemporary Approaches to the Big
Idea
- Used across a variety of media
- Engage consumers and enter
into a dialogue with them
1
Copyright © 2015 McGraw-Hill Education. All rights reserved.
No reproduction or distribution without the prior written
consent of McGraw-Hill Education.
Chapter 9
Creative
Strategy:
Implementation
and Evaluation
9-2
Appeals and Execution Style

29. consumers’ attention and/or to influence their
feelings toward the product, service, or cause
particular appeal is turned into an advertising
message presented to the consumer
9-3
Informational/Rational Appeals
consumer’s practical, functional, or
utilitarian need for the product or service
- Focuses on the dominant traits of
the product or service
9-4
Types of Informational/Rational
Appeals
Competitive advantage appeal

30. • Compares to another brand and claims superiority on one or
more attributes
Feature appeal
• Focuses on the dominant traits of the product or service
Favorable price appeal
• Makes product price the dominant point of the message
News appeal
• Involves a type of news about the product, service, or
company
Product/service popularity appeal
• Stresses the popularity of a product or service by pointing out
the:
•Number of consumers who use the brand or those who have
switched to it
•Number of experts who recommend the brand
•Leadership position in the market
9-5
Emotional Appeals
needs for purchasing a product or service

31. of a brand
9-6
Advantages of Emotional-Only
Campaigns
More effective in relation to campaigns using
emotional and rational content
Work well during economic downturns
Influence consumers’ interpretations of product
usage experience
2
9-7
Transformational Ads
Richer
More
Exciting
Warmer
Feelings

32. Meanings
Images
Beliefs
More
Enjoyable
It makes the
product use
experience. . .
The ads
create . . .
9-8
Transformational Ad
brand with a unique set of psychological
characteristics
and/or more enjoyable

33. the experience of using the brand
9-9
Additional Types of Appeals
Reminder advertising
• Builds brand awareness and/or helps keep the brand
name in front of consumers
Teaser advertising
• Builds curiosity, interest, and/or excitement about a
product or brand by talking about it but not actually
showing it
User-generated content (UGC)
• Created by consumers rather than by the company
and/or its agency
9-10
Ad Execution Techniques
Straight-sell or factual message
• Relies on a straightforward presentation of information
concerning
the product or service
• Used with informational/rational appeals
Scientific/technical evidence

34. • Advertisers cite technical/scientific information to support
their
advertising claims
Demonstration
• Illustrates the key advantages of the product by showing its
actual use
• Effective in convincing consumers of a product’s utility,
quality, and
benefits
9-11
Ad Execution Techniques
Comparison
• Shows a brand’s particular advantage over its rivals
• Helps in positioning a new or lesser-known brand with
industry leaders
• Used to execute competitive advantage appeals
Testimonial
• Messages are presented by a person who elaborates on
his or her personal experience with it
• Endorsement - A well-known or respected individual
speaks on behalf of the company or the brand
9-12

35. Ad Execution Techniques
Slice of life
• Based on a problem/solution approach
• Used by business-to-business marketers
• Slice-of-death advertising - Focuses on the negative
consequences that
result when wrong decisions are made
Animation
• Uses animated scenes in advertisements
Personality symbol
• Developing a central character that can deliver the advertising
message
• Aids consumers to identify with a product/service
3
9-13
Ad Execution Techniques
Imagery
• Consists of visual elements rather than information
• Encourage buyers to associate the brand with the symbols,

36. characters, or
situation shown in the ad
Dramatization
• Focuses on telling a short story with the product or service as
the star
• Steps
• Exposition
• Conflict
• Increase in action, conflict, and suspense
• Climax
• Resolution
9-14
Ad Execution Techniques
Humor
• Used to present other advertising appeals
Combinations
• Using various execution techniques to create a
message
9-15
Basic Components of Print Advertising

37. identifying the product or service or getting to the point
9-16
Basic Components of Print Advertising
Body copy
• Main text portion of a print ad
• Goal - Communicate the message and hold consumer attention
Visual elements
• Play an important role in determining the effectiveness of the
ad
• Goal - Work synergistically with the headline and body copy
to
produce an effective message
Layout
• Physical arrangement of the various parts of the ad

38. 9-17
Basic Components of Print Advertising
Layout
How Elements Are Blended Into a Finished Ad
Visual Elements
Illustrations Such As Drawings or Photos
Body Copy
The Main Text Portion of a Print Ad
Subheads
Smaller Than the Headline, Larger Than the Copy
Headline
Words in the Leading Position of the Ad
9-18
Ad Layout
Headline
Copy
Visual
Element
Identifying

39. mark
Subhead
4
9-19
Basic Components of Television
Advertising
Video
• Visual elements that attract viewers’ attention and
communicate an idea, message, and/or image
Audio
• Includes voices, music, and sound effects
• Voiceover: Message is delivered by an announcer who is not
visible
• Needledrop: Music that is prefabricated, multipurpose, and
highly conventional
• Jingles: Catchy songs about a product or service that carry
the advertising theme and a simple message
9-20
Planning and Production of TV

40. Commercials
oducing high-quality TV commercials incurs high
costs
commercial
9-21
Planning and Production of TV
Commercials
provides a detailed description of its video and audio
content
phase

41. 9-22
Production Stages for TV
Commercials
Preproduction
All work before actual
shooting, recording
Production
Period of filming, taping, or
recording
Postproduction
Work after spot is filmed or
recorded
9-23
Preproduction Tasks
Select a director
Cost estimation
and timing
Choose
production
company
Bidding
Preproduction
meeting

42. Production
timetable
Preproduction
9-24
Production Tasks
Location Timing Talent
Production
5
9-25
Postproduction Tasks
Editing Processing
Sound
effects
Audio/video
mixing
OpticalsApprovals
Duplicating
Release/
shipping

43. Postproduction
9-26
Client Evaluation and Approval
-side approvals include:
irector or vice president
9-27
Guidelines for Evaluating Creative
Output

44. customer
it is likely to be seen
9-28
Guidelines for Evaluating Creative
Output
the message
Web Exercise 5
Focus Text – Chapters 8 & 9
Watch the three commercials (Hallmark Ad, Chips Ahoy Ad and
Braathens Safe Airlines Ad)
within this folder.
After watching these commercials, answer the questions below.
Please make sure it is clear to
me which ad you are discussing. In order to receive full credit,
you must answer each question

45. for each of the three commercials. Make sure you integrate
information from the chapter
readings into your answers.
Questions:
1. Briefly analyze the type of advertising appeal used in each
commercial.
2. What type of creative advertising execution technique is
being used for each spot?
3. Discuss the target audience for each commercial and whether
you feel the ad is an effective
way to communicate with this market segment.