PROJECT 2 - ASSIGNMENT

Factor – Hair – Revised

Submitted by: Bibin Vadakkekara Bhaskaran

Great Lakes Institute of Management

Advance Statistics
Table of Contents
List of Tables....................................................................................................................................0
List of Figures...................................................................................................................................0
1. Project Objective & Background..............................................................................................1
2. Assumptions............................................................................................................................2
3. Exploratory Data Analysis – Step by Step approach................................................................2
4. Conclusion................................................................................................................................2
Appendix 1 – Source Code...............................................................................................................2
List of Tables
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List of Figure

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1. Project Objective & Background
Cold storage company which started business operations in 2016 has a strict policy of
maintaining the temperature at which the products such as Pasteurized Fresh Whole or
Skimmed Milk, Sweet Cream, Flavored Milk Drinks are stored in the cold room, between 2
degree Celsius (⁰C) and 4⁰C. The plant maintenance is outsourced to a third-party professional
company with stiff penalty clauses. Also, there are customer complaints regarding the quality of
products supplied from the cold storage in the recent days.
In the first year of business they outsourced the plant maintenance work to a professional
company with stiff penalty clauses. It was agreed that if it was statistically proven that
probability of temperature going outside the 2 - 4 C during the one-year contract was above
2.5% (0.025) and less than 5% (0.05) then the penalty would be 10% of Annual Maintenance
Contract (AMC) fee. In case it exceeded 5% (0.05) then the penalty would be 25% of the AMC
fee.
Thus, the primary aim of this report is to
1. Identify the slab of penalty that is to be imposed on the maintenance company if
statistically proven that the probability of temperature variation
a. 10 % AMC
b. 25 % AMC
In Mar 2018, Cold Storage started getting complaints from their Clients that they have been
getting complaints from end consumers of the dairy products going sour and often smelling. On
getting these complaints, the data of last 35 days’ temperatures is fetched. In order to identify
corrective actions needed such as whether the commodities got spoilt due to temperature
variations in the cold storage facility or due to quality issues from the procurement side, the
secondary project objective is to
2. Conclude whether there is any corrective action required for the cold storage or the quality
issues lies at the procurement side by conducting a hypothesis testing and thus inferring the
result obtained.
*For research area 1, “Cold_Storage_Temp_Data.csv” is used and research area 2,
“Cold_Storage.csv” is used.

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2. Assumptions
The following assumptions are taken into consideration
1. The measurement of temperature is accurate.
2. The data is normally distributed.
3. All data points are independent.
4. In DF 2 Assume 3.9⁰C as upper acceptable value for mean temperature and alpha = 0.1

3. Exploratory Data Analysis – Step by Step approach

4. Conclusion
4.1. Perform exploratory data analysis on the dataset. Showcase some charts, graphs. Check
for outliers and missing values (8 marks)
4.2.  Is there evidence of multicollinearity ? Showcase your analysis(6 marks)
4.3. Perform  simple linear regression for the dependent variable with every independent
variable (6 marks)
4.4. Perform PCA/Factor analysis by extracting 4 factors. Interpret the output and name the
Factors (20 marks)
4.5. Perform Multiple linear regression with customer satisfaction as dependent variables
and the four factors as independent variables. Comment on the Model output and
validity. Your remarks should make it meaningful for everybody
(20 marks)

Appendix 1 – Source Code

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