Question

Record of product launch success/failure over the last 25 years: COMPANY A

# of successful products (out of 10) …	0	1	2	3	4	5	6	7	8	9	10
… in # of years out of last 25 years	0	1	0	2	1	3	4	5	5	3	1

Record of product launch success/failure over the last 25 years: COMPANY B

# of successful products (out of 10) …	0	1	2	3	4	5	6	7	8	9	10
… in # of years out of last 25 years	1	2	1	2	3	3	5	3	4	1	0

1. On an average, how many products are launched successfully by Company A in a given year? Similarly, on an average how many products are launched successfully by Company B in a given year

2. let us assume that we look at flops or failures to measure success (or lack of it). The idea is that a company that produces more flops (than its competitors) cannot be considered successful. calculate the likelihood of 4 or less products succeeding in a given year. 4 or less products succeeding (which is the same as 6 or more products failing) can be a reasonable proxy for majority of the products failing.

3. Let us assume that we employ a few different sets of standards for measuring success 3(or failure). Instead of using averages, we use the following alternate benchmarks:

a. Let’s assume that we measure the likelihood of 6 or more successful product launches in any given year by these firms. The underlying idea is that a successful firm should get a majority of its products.

4. Of the three measures of performances (calculated in ‘2a’, ‘3a’ & ‘3b’) which one do you think is the most appropriate or effective measure of success? Why?

Or do you think each measure might be relevant or useful under different circumstances? Why?

1. Company B had a very successful streak from 2014-2017, where all the 10 products it launched succeeded through these 4 years? Given this success it is enjoying, what is the probability that all 10 products it launches in 2018 will succeed? (1 Point)

   1. For the same scenario above, what is the probability that none (0) of the products for company B will succeed in 2018? (1 Point)

2. Company A on the other hand, had a string of bad years, and none of its products (0) it launched in 2017-2018 succeeded? Given this lack of success, what is the probability that all 10 products it launches in 2019 will succeed? (1 Point)

   1. For the same scenario above, what is the probability that none (0) of the products for company A will succeed in 2019? (1 Point)

3. Looking at the success that company ‘B’ has had, ‘A’ now hires one of its chief scientists in 2019. What is the probability now that all its products will succeed in 2020? (1 Point)

Answer 1