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Intro To Modeling Professor Mouwafac Sidaoui

Definition History Examples

Spreadsheet and Business Analytics

Professor Mouwafac Sidaoui

Spreadsheet…

 What is a spreadsheet?  "spread sheet" or spreadsheet was and is a large sheet of paper with columns and rows that organizes data about transactions for a business person to examine.  shows all of the costs, income, taxes, and other related data on a single sheet of paper for a manager to examine when making a decision.  electronic spreadsheet organizes information into software defined columns and rows.  help a decision maker see the financial "big picture" for the company.

Saturday, October 19, 2013 1 Intro To Spreadsheet Modeling Professor Mouwafac Sidaoui

Brief History of Spreadsheet…  have been used by accountants and Analysists for hundreds of years  Computerized or electronic spreadsheets are of much more recent origin.  is the "father" of the electronic spreadsheet.

 1978, as a Harvard Business School student, he came up with the idea for an interactive visible calculator  Bricklin and Bob Frankston co-invented software program [visible calculator].

Dan Bricklin & Bob Frankston

Approximately ≈ 1980

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What came after VisiCalc?

 spreadsheet software was growing rapidly in the early 1980s  VisiCalc were slow to respond  Legal business distractions led to new development  In 1983 IBM responded  developed Lotus 123 and the application quickly became the new industry spreadsheet standard

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What is Lotus 1-2-3?

 Lotus 1-2-3 made it easier to use spreadsheets and it added integrated charting, plotting and database capabilities.  Lotus 1-2-3 established spreadsheet software as a major data presentation package as well as a complex calculation tool.  Lotus was also the first spreadsheet vendor to introduce naming cells, cell ranges and spreadsheet macros.

Lotus Life

 1983, Lotus’ first year of operations, the company reported revenues of $53 Million and had a successful public offering.  1984, Lotus tripled in revenue to $156 Million.  1985, Lotus employees grew to over a thousand. This rapid growth led to a shakeout in the spreadsheet segment of the software industry.  1985, Lotus Development acquired Software Arts and discontinued the VisiCalc program.

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What about Excel?  The next milestone was the spreadsheet.  Excel was originally written for the 512K Apple Macintosh in 1984-1985.  Excel was one of the first spreadsheets to use a graphical interface  Excel spreadsheet with a graphical user interface was easier. Many people bought Apple Macintoshes so that they could Excel spreadsheet program.  1987, Excel was one of the first application released for Windows OS.  1989, Excel was Microsoft's flagship product  In the late spring of 1995, IBM acquired Lotus Development and Microsoft Excel is the spreadsheet market leader.

Key Dates in the history of Microsoft Excel

 1985 Excel 1.0 launched.

 1986-88 Microsoft releases versions 1.0.6 and 1.5.

 10/31/87 Launch of Excel 2.0 for MS-DOS version 3.0

 1989 Launch of Excel 2.2 for Macintosh. New version includes improvements in the calculation speed by 40% and added flexibility of different styles within a single document.

 12/9/90 Excel 3.0 is launched. This version includes Workbooks and is one of the earliest Macintosh applications to offer Users Publish & Subscribe functionality.

 4/1/92 Microsoft Releases Excel 4.0 for Windows 3.1.

 11/1/92 Excel 4.0a for Windows 3.1.

 12/14/93 Excel 5.0; This version includes improved Workbooks and the replacement for Excel Macro Language with Visual Basic.

 7/27/95 Excel 7.0 for Windows 95/NT.

Saturday, October 19, 2013 5 Intro To Spreadsheet Modeling Professor Mouwafac Sidaoui

Spreadsheet Historic Summary  Visicalc was the first electronic spreadsheet on a ,  It helped turn the Apple II computer into a popular and widely used system.  Lotus 1-2-3 was the leading spreadsheet when DOS was the dominant .  Excel now has the largest market share on the Windows and Macintosh platforms  A spreadsheet program is a standard feature of an office productivity suite.  Since the advent of web apps, office suites now also exist in web app form.

Other Spreadsheet Applications

 Open Office www.OpenOffice.org  Apple iWork www.apple.com/iwork/numbers  Google Docs Spreadsheet http://docs.google.com  JMP, SAS Product www.jmp.com/software  Tableau www.tableausoftware.com  SPSS, IPM Product www.spss.com  …many others…

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References

 "VisiCalc '79: Dan Bricklin and Bob Frankston", Creative Computing, November 1984, vol. 10, p. 122, 124.

 "VisiCalc Production Ends", PC Magazine, August 6, 1985, vol. 4, p. 33.

 Bajarin, T. "VisiCorp was PC software industry's training ground." PC Week, August 13, 1990, v7 n32, p.117.

 Browne, Christopher. "Historical Background on Spreadsheets", at URL http://www.ntlug.org/~cbbrowne/spreadsheets.html, visited March 24, 1998; also checked http://www.hex.net/~cbbrowne/spreadsheets.html 04/12/1999.

 Claymon, D. "Profile: Mitch Kapor, The Lotus cofounder goes to bat for startups", Red Herring Magazine, February 1999, URL www.herring.com/mag/issue63/news-profile.html.

 Frankston, R. Email message, 04/15/1999a.

 Frankston, R. Email message, 04/15/1999b.

 Henderson, T.B., D.F. Cobb, G.B. Cobb. Spreadheet Software from VisiCalc to 1-2-3. Indianapolis: Que Corp., 1983.

 Kapor, M. Email message, 04/15/1999.

 Mattessich, Richard. "Spreadsheet: Its First Computerization (1961-1964)", at URL http://www.j-walk.com/ss/history/spreadsh.htm.

 Pardo, R. Email message, 08/20/2004.

According to Bill Jelen “mr. Excel” www.mrexcel.com

Did you 50% of Excel know? users leave 80% of Excel untouched...

Saturday, October 19, 2013 7 Intro To Spreadsheet Modeling Professor Mouwafac Sidaoui

Definition of Spreadsheet Modeling…

 Spreadsheet modeling is a creative process, and thus cannot be reduced to a simple recipe, every spreadsheet passes through a predictable series of four stages:

1. Designing 2. Building 3. Testing 4. Analysis  Modeling for insight requires skills in establishing a base case, performing sensitivity analysis, using back- solving, and (when necessary) carrying out optimization and simulation.

Basic Spreadsheet Modeling Concepts…

 Most mathematical models, including spreadsheet models, involve: 1. Inputs – given values that are fixed for the model 2. Decision variables – under the control of the decision maker 3. Outputs – determined by input and decisions variables  There isn’t one best spreadsheet practice but there are good habits to learn:  Model must be readable, clear and logic  Separation of parts in spreadsheet  Clear headings for input decision and output variables  Use of rangenames  Use of various formatting (font, size, color)  Cell comments and text boxes for lists and explanations

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Turning Numbers into Knowledge

 The Art of Estimation: Ping Pong Ball exercise  How many ping-pong balls could you fit into the room? 1. Take just 60 sec to answer the question 2. Solving the same problem in 5 min (with a partner)

 Take 10 min to make a list of the points that you think these two exercises illustrate.

Ping Pong Ball Exercise  What type of model did you use?

 You modeled in terms of categories such as few, some, lots or tens, hundreds, thousands.  You drew a mental picture of a ping-pong ball and looking around the room  You then estimated that the answer belonged in one category rather than another

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Turning Numbers into Knowledge: Ping Pong Ball Exercise

 Volumetric calculation…

 You might have estimated the volume of:  a ping-pong ball  volume of a room  divided one into another  Did you model the ping-pong ball as a cube rather than a sphere?  Did you model the room as a large, empty box?  Did you ignore the furniture?  Did you assume that you were not allowed to squash or deform the balls?

Turning Numbers into Knowledge: Ping Pong Ball Exercise

 Solving the same problem in 5 min (with a partner)

 Keep a note of how you go about solving it.  How did you go about solving the problem this time?  Did you use the same procedure but refine your measurements?  Did you use the extra time to take a new approach?  Did you change your model?  Did you modify your assumptions? Did you, for example make a correction for the furniture or the shape of the room?  What were the differences between working alone and working in a team?  Did you share tasks?  Did you start with similar ideas or did you spend time arguing about the proper approach?  Given more resources (time and people), chances are you may have built a more sophisticated model.

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Turning Numbers into Knowledge: Ping Pong Ball Exercise What have you learned about modeling?

Online calculator

www.online-calculators.co.uk/volumetric/roomvolume.php

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