Gillette vs. Energizer 2019. Duke University DECISION 517F

DECISION 517F – Spreadsheet Modeling & Decision Analysis
Fuqua School of Business
Spring Term 2, 2018-2019
Gillette vs. Energizer
Prepare for Class 4
(Will be graded)
One of the more difficult decisions a manager may face is whether to file a lawsuit or whether (and
how) to settle a lawsuit. These decisions require careful consideration of a number of uncertainties:
• If you go to court, will you win or lose?
• If you do win or lose, what damages will be awarded?
• How will a legal victory or loss affect your future business?
• How much will it cost to litigate?
In this case, we consider the use of decision tree analysis as a logical process for organizing and
integrating the legal and business judgments involved in evaluating litigation strategy.
Assignment: Build a decision tree model to analyze Gillette's settlement decision. Use the techniques
that we have studied – decision trees, sensitivity analysis, value of information analysis, and utility
theory – to analyze this decision.
Each group of students should prepare a 10-15 minute PowerPoint presentation describing their
analysis and recommendations. You should take your audience to be senior management at Gillette
and/or Proctor and Gamble: you should assume that the audience is familiar with the facts of the case
and understands decision tree analysis. In each section, we will select one or more groups to give their
presentations to the class.
Deliverables:
• Before class (due date specified on Canvas), submit an electronic copy of your presentation and
spreadsheet model using the Assignment tool in Canvas. If you are selected to present in class, you
should plan to give your presentation from the file you submitted online. We will grade the
submitted hardcopy (see below) but may review your electronic files if we want to see the details
of the model. We only need one electronic submission per team; please note your teammates in
the text box when you submit in Canvas.
• At the beginning of class, each group should submit a hardcopy of their presentation; we need one
hardcopy per team. If there are comments you would make in your presentation but did not put in
your slides, please include these comments in the presentation using the "Speaker notes" feature
of PowerPoint; then print and submit the "Notes Pages." Please include a copy of your decision
tree in the presentation or as an appendix. You should also keep copies of these materials as you
may find them useful for the class discussion.
Your assignment grade will be based on the quality of your analysis (e.g., correctness, completeness
and appropriateness) as well as the quality of your presentation.