Pre Courses

MBA ITB

Business Analysis

Manahan Siallagan
School of Business and Management
ITB

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 Self Introduction
Dr. Eng. Manahan Siallagan S.Si, MT, M.Sc
Education:
Bachelor degree: Mathematic, InstitutTeknologi Bandung in 1998
Master degree: Electrical engineering, InstitutTeknologi Bandung in 2003
Master degree: Computational intelligent and systems science, Tokyo Institute of Technology in
2011
Doctoral degree : Computational intelligent and systems science, Tokyo Institute of Technology
in 2013

Published papers:
Systems Research and Behavioral Science
Systems Research and Behavioural Science
Evolutionary and Institutional Economics Review
Several chapters in Books published by Springers.
Work Experience:
Lecturer at UNIKOM: 2000-2007
Lecturer at ITB: 2004-Now
Expert Staff at UKP4: 2014
Chief of Modelling at IIASA TFI-Project: 2014-Now
His research interests:
Social simulation, decision science and negotiation, system thinking, statistical
modeling, game theory, and agent based modeling.
 Agenda
08:00-09:30
Pre Course: Business Analysis
Common mistakes on MBA Thesis
09:30-10:00
Break
10:00-11:30
Basic Methods for Business Analysis
Short introduction about some methods in Business Analysis and
examples
11:30-13:00
Break
13:00-14:30
How to overcome The Mistakes
One example of MBA thesis which describe the mistakes and how to
overcome the mistakes
14:30-15:00
Break
15:00-16:30
Practices
The students asked to construct their understanding about how to
overcome the mistakes by using a case form MBA thesis
Discussion
 What is Business Analysis

Wikipedia
(https://en.wikipedia.org/wiki/Business_analysis):
Business analysis is a research discipline of
identifying business needs and determining
solutions to business problems.
The person who carries out this task is called
a business analyst or BA.

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 Business Analysis is Problem
Solving

Problem

Solution Hypothesis

Analysis Facts

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Mistakes often happened in MBA
Students thesis
Can not differentiate problems/issues, root cause and solution.

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Mistakes often happened in MBA
Students thesis
Can not differentiate problems/issues, root cause and solution.

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 Problem
What is a problem?
A problem is the visible effect of a cause
that resides somewhere in the past.
How to solve a problem?
We must relate the effect we observe to
its exact cause. Only then can we be
sure of taking appropriate corrective
action-action that can correct the
problem and keep it from recurring.

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The Structure of a Problem
A performance standard is achieved when all conditions
required for acceptable performance are operating as
they should.

Sometimes
conditions
improve,
positive
changes
occur, but
unexpected
decline occur.

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EXAMPLE: THE BANK IN
HAWTHORNE

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 The Bank in Hawthorne (1)

A major bank in California has a number of branches in the Los

Angeles area. The operating results of all branches are reviewed
monthly by the Executive Committee. At a July review, the
Hawthorne branch showed a volume of transactions slightly below
plan. All the other branches were right on target or above.

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The Bank in Hawthorne (2)
In August the Hawthorne branch slipped a little further, in September even
more. In October the news was worse yet. Members of the Executive
Committee began an investigation. One vice president suggested exploration
of the subject of change, saying he had already given it some thought and
pointing out that when the decline in transactions was observed the new
branch manager had been in his position for about two months. "Look, he
represents a change all right. He came in just before the branch started to
slip. I thought we were making a mistake then and I'm sure of it now."

August October
Other Branches
Target
transaction
Hawthorne branch
New branch manager

July September 12
 The Bank in Hawthorne (3)
The committee went on to consider- who might take
over that position if the bank let the new manager go.
After long discussion the, chairman suggested that they
might be jumping to cause on the basis of a single fact.
He wanted the Committee to consider the decline in
terms of an informal specification-to discuss the
Identity, Location, Timing, and Magnitude of the
decline. He wasn't taking anything away from the vice
president's assessment. He just wanted to make sure
the situation was investigated thoroughly and
objectively before action was taken that would
seriously affect the branch manager's career.

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 The Bank in Hawthorne (4)
Despite some disagreement they began an objective
analysis. In the dimension of Location, the Committee
named the Hawthorne branch as the IS. It was in
Hawthorne alone that the decline was observed. All other
branches represented the IS NOT. The question
"What is distinctive about the Hawthorne branch
when compared with all other branches?" led to
discussion of its proximity to International Airport and the
factories of North American Aviation and Douglas Aircraft.
"Wait a minute," someone said. "North American has been
stretching out work on the B-70 bomber and laying off
people for some time. And Douglas is transferring a lot of
its work from Hawthorne to Long Beach. . . ."

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 The Bank in Hawthorne (5)
Specifiyng IS IS NOT What is dictinctive about
question
IDENTITY WHAT is the decline the other
malfunction/ transactio malfunction
Problem? n s
LOCATIO WHERE is the IS COULD BE Howthorne branch is
N (where malfunction obeserve but IS NOT located near to
we observed at observed at International Airport
observe (geographically)? Hawthorne other and the factories of
it) branch branches North American
Aviation and Douglas
Aircraft
TIMING WHEN was the IS occur COULD BE North American has
(when it malfunction first two but IS NOT been laying off their
occurs) observed? months observed employee. And Douglas
ago before two is transferring a lot of
months ago its work from
Do you agree that the cause is the change of theHawthorne
new branch to Long
manager?
Beach
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 An Example (1)
An analyst at XYZ bank observed that non-performing
loans (NPL) in XYZ Bank was slightly higher than the
average NPL of all banks nationwide.
In 2010 the nationwide NPL is 3.54% while the NPL in Bank
XYZ is 4.3%.
He suspects that the XYZ bank is not able to adapt in order
to recover from the economic crisis in 2008. The average
NPL in 2008 was 3.32% while the NPL in XYZ bank is 4.9%.
Although the maximum limit set by the NPL Central Bank is
5%, but since XYZs NPL is higher than the national
average NPL the analysts suspect that the Internal Rating
System (IRS) is currently implemented at XYZ Bank needs
to be changed.

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 An Example (2)
The ideal NPL is 0%

2008 2010
XYZs deviation Averag
Average NPL es
deviati
on
XYZs NPL

He suspects that the cause is: XYZ bank is not able

to adapt in order to recover from the economic crisis in 2008

Was the conclusion correctly taken?

Assuming that the cause is correct, then how should the conclusion derived?
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Mistakes often happened in MBA
Students thesis

Can not differentiate

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 Which Problem?

Situation
Analysis

Problem Analysis Decision Analysis Potential Problem Analysis

PAST PRESENT FUTURE
What is the faults? How to correct the faults?
How to Prevent Future Faults?

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Mistakes often happened in MBA
Students thesis

Unclear definition of

What will you achieve by solving the problem?

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Define Objective: Transformation Process
D
e
c
i
s
i
o
n
Criteria?

Input
Transformation Output
(some entity) Process (that entity in
a transformed state)

Example : a public library

A local That population better informed
population

A local need for information That need met

and entertainment from books,
records, etc.

Books and other materials on Books and other materials out

the shelves in the local community
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Mistakes often happened in MBA
Students thesis

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 Decision Analysis: MCDM
Criteria ALTERNATIVES

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 Decision Analysis:
Mathematical Models

Decision Support Systems and Intelligent Systems, Efraim Turban and Jay E. Aronson, 6th edition,
Copyright 2001, Prentice Hall, Upper Saddle River, NJ

Information about consequences: Model Simulation,

Model Analysis
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Mathematical Model: Linier Programming

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Mistakes often happened in MBA
Students thesis

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Types of Problem

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 Grouping Problem Contexts
Problem contexts can be grouped according to two dimensions:

Simple Complex

Unitary Pluralist Coercive

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 Grouping problem contexts
Conflict
Purposive Purposeful

Unitary Plural Coercive

Simple

Closed System
(Finding the best
solution)
Complexity

Improving Exploring Ensuring

Goal Seeking Purposes Fairness

Open System
(How we can
adapt/learn the
Complex situation)

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 Grouping Systems Methodologies based on
their assumptions about problem contexts
Unitary Pluralist Coercive

S-U S-P S-C

Statistic
SAST (strategic CSH (Critical
Math Modelling
assumptions surfacing System Heuristics)
Simple Root cause Analysis
Operations Research and testing) Confrontation
Systems Analysis FGD/BrainStorming Analysis
Systems Engineering AHP/MCDM Negosiasi
Systems Dynamic
PSM

Complex
C-U C-P C-C
VSD (Viable IP (Interactive
System Diagnosis) Planning) ?
Learning SSM (Soft Systems
Organization Methodology)
ABM
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Thank

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