Statistics in Business

Statistics in Business

QNT/351

November 23, 2014

Statistics in Business

Introduction

Statistics is the science involving the application of quantitative principles to the collection, interpretation, and presentation of numerical data. Statistics is used daily in business and is an important asset to the decision making process. There are two broad areas of statistics, one area uses known information and one area that asks for conclusions to be made from the data that is collected. The role of statistics in the business decision-making process is inimitable.

Role of Statistics in Business Decision Making

Statistics are important in business to review how the company is doing, and make changes to products, or procedures as needed to increase business. Everyday issues that managers face are solved more efficiently when managers create a statistical question that can be solved by data. Collecting data and analyzing outcomes prior to implementing actions will allow the manager to make an informed decision and save time and money by avoiding trial and error.

Types and levels of Statistics

Statistics can be broken down into two broad areas: descriptive and inferential statistics. Description statistics utilize numerical data and graphics to look for patterns in a data set. Inferential statistics utilize information from sample data to make estimates, decisions, predictions or other generalizations about a larger set of data. While descriptive and inferential statistics are the main levels; there are different levels of measurement that is involved in statistics. The four levels of measurement include ordinal, nominal, ratio, and interval data. Each of these different measurements have different goals.

Statistics Usage

In the world of sports, managers use statistics such as batting average, scoring percentages and many others to decide the correct personnel to play in a given situation. Managers can then detect which player will be best to use in...