Pedigree vs. Grit Harvard Case Solution & Analysis

Pedigree vs. Grit Case Solution


AMBTPM is an asset management company, which engages in asset &mutual funds management in the stock as well as the conventional market to expand its business and gain more revenues. The mutual fund has gained importance in the stock market as compared to the recent decades. The global mutual fund industry has grown from its condition in the early 2000s. From 1988 $9.6 trillion to  $17.6 trillion in 2005, it has grown to almost double. The company is headed by Jack Beam, a Kellogg MBA, as the company’s CEO, whereas Larry Debolt is head of the management function of the company who performs his duties as a manager of mutual funds for AMBTPM and managing two signature mutual funds AMBTPM Signature & Debolt ONE. Larry is one of the most successful managers in the company who is controlling and navigating AMBTPM towards success. He is both cherished by the seniors and respected by his subordinates in the company. He plays a vital role in the company’s management however unfortunately for the company, Larry Debolt has decided to retire at the age of 43 years so that he could concentrate on spending more time with his family and in publishing his book entitled “Those who write ‘How to Succeed in the stock market”. Although Larry would be missed however, the management of AMBTPM is faced with difficult & challenging task of finding a replacement for Larry who understands the business and would increase or add to the existing condition & value of the company. The management has different philosophies on who would be a better manager for the mutual funds of the company, either a person with more experience in the business of mutual fund or a person with higher education such as MBA degree from Harvard or of similar sorts. The determination of who would be better at managing mutual funds depends on the balance between the education and experience.

Problem statement

The main problems faced by AMBTPM is that its manager, Larry Debolt, has decided to retire at the age of 43 years leaving the company and its management with the daunting task of finding a replacement for the seemingly un replaceable manager and the most successful mutual fund manager in the company’s history, who managed AMBTPM’s two signature mutual funds AMBTPM Signature & Debolt ONE. Now the management has shortlisted two candidates as the replacement of Larry Debolt, one is the Ohio State graduate, 35 years of age, managed an income fund for five years. The other is a graduate from Princeton with an MBA degree from Harvard, 32 years of age, managed an income fund for two years. Although everyone at the company has his own opinion regarding “what makes a successful manager” however, the most opinionated of them all are the two groups whose opinions actually matter in this case for the replacement of Larry’s position. One is the CEO,Jack Beam,and the other is Larry himself. Both of them have different philosophies when it comes to making a successful manager.


Question:  1 (a) The main purpose of regression model is to produce high R-squared value. The combination of low P value/high R-squared value indicate the changes in the response variable to make relevant predictions. The relationship is very difficult to understand where the situation is based on numbers alone since a low r-squared is not necessarily bad or a high R-squared is not necessary good. Research has shown that graphs are essential in analyzing the predictors in the regression analysis. Hence, the disagreement is based on the fact that Jack Beamdeemed the analysis solely based on number and did not properly analyze the regression analysis through the use of graphs to correct interpret the results of the regression analysis.......................

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