Importance and Types of Business Statistics

Introduction

What is meant by business statistics? Do you want to make a career in business statistics? Unless you are a business student, the word statistics creates an image. What kind of Image? This is the picture of calculations, numbers, and graphs in your mind. But is that what it means? No, it is not what business statistics is genuinely about. Of course, it is related to business and statistics. (After all, these words make it). But it is much more than that.

Therefore, do you want to know what business statistics truly mean? You are in the right place. This article will help you find out

  • the meaning,
  • the importance,
  • and the types of BSc statistics.

Moreover, you will also learn about ways to make a career in it. (Read till the end for a surprise!). So, stay tuned to know more.

What does the word Statistics mean?

Before we go ahead, let us first know the basic meaning of ‘statistics’. Statistics means ‘science that deals with data’. (No, it isn’t data science)

It means the process of carrying out the following processes on the data: –

  • Collection
  • Summarisation
  • Organization
  • Analysis
  • Interpretation

All this information is then used to form results. (But it isn’t data analysis also).

In business, the mathematical analysis of data takes place. However, the main purpose of business statistics in all businesses is the same. It is to carry out smart decision-making. Now, why is proper decision-making so important in business? Let me tell you why.

  • Firstly, these decisions help to deal with business-related difficulties.
  • And secondly, they also help to make predictions. (Just like your astrologer)
  • In this way, they help the business to make more future profits. (If you work hard enough)

In conclusion, BSc. Statistics are very important. This is first for the stable functioning of a business. And second, for committing the least mistakes. And also to minimize errors.

Simultaneously, proper statistical analysis help in business growth. It finally leads to the development of business. Following this, you can use these calculations to make useful functional changes. These changes help to elevate your business. This is to produce added profits in the future. Business statistics, therefore, is one of the most important parts of the business. (Also, no change happens overnight. It takes time and effort)

You can also read our blog on Scope of Statistics.

business statistics
January 14, 2022
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Table of Contents

What does the subject of business statistics deal with?

  • Business-related statistical study
  • Descriptive statistics
  • Probability
  • Linear regression
  • Correlation
  • Data distributions
  • Hypotheses test
  • Confidence intervals

What! Only eight things to learn? Yes, only 8. But they are further divided. These divisions aren’t easy to understand.

What are the types of Business Statistics?

It is better to know the basics before learning the details. So, let us have a brief knowledge of two types of BSc. Statistics.

1. Descriptive Statistics

Production of the summary of given observations. These are referred to as sample data. The sample data is summarised using varied criteria. For instance, the standard deviation and mean value are some. All these are parameters of measurement.

It is further divided into four subcategories: –

  • Measurement of frequency
  • A measure of the central tendency
  • Variation and dispersion capacity
  • Measure of position

Central tendency

The term dispersion measure is used for describing Central tendency. Did you notice that I am using the word ‘central’ here? Are you wondering why? Well, I’ll tell you the main reason. It lies in the core meaning of the word. Here, the word ‘central’ indicates the middle values as the focal point. They are the focus of measurements.

Here, you first determine where the bulk of data lies. Then you use this report for calculating the following: –

  • Mean
  • Mode
  • Median of the population.

Measurement of frequency

After you have calculated the focal point, you determine its frequency. But the thing is, how to do this?

It is really simple. The above-given parameters help to discover the common pattern. Where? In the analyzed data. This pattern is known as frequency. It simply means how often a value is reoccurring in your data.

Variation and dispersion capacity

Then you will answer the following questions.

  • How much is the difference between the lowest and highest data values?
  • How much do the values get deviated? Meaning what variations happen away from the mean value? The mean value is also called the average value.

Again, how can these questions be answered? There are four calculations that you need to carry out to do so. This will include a measurement of the following: –

  • Standard deviation
  • Quartiles and interquartile
  • Absolute deviation
  • Range

The dispersion measurement will help you know the distribution of your data.

Measure of position

Used to calculate the standing of particular data in the whole statistics. But in BSc. You only use statistics to determine exactly the point at which the data value falls.

Finally, all these calculations help in forming correct descriptive statistics. Likewise, it is important to know that these factors are equally important. The lack of even one of them will lead to business failures in the proper formation of BSc. Statistics, they all must be there.

Therefore, while doing business statistics, make sure you calculate all of them.

2. Inferential Business Statistics

Inferential statistics is the second type of business statistics. Inference, in general, means a result. Similarly, inferential statistics means forming conclusions. It also involves making interpretations. The data from descriptive statistics are used for doing this.

In short, data analyzed in the first step of descriptive statistics is used to make decisions in the next step of inferential statistics.

It is divided into the following eight sub-categories: –

  • Sample hypothesis test
  • Confidence Interval
  • Contingency Tables
  • Chi-Square Statistic
  • Anova
  • Pearson Correlation
  • Bi-variate Regression
  • Multi-variate Regression

Henceforth, both of these components are very important. It is not possible to do successful business statistics without them. So, it would not be wrong to say that one is incomplete without another.

The Importance of business statistics

There are many ways in which BSc. Statistics play a vital role in business. It starts with research and ends in beneficial changes—all in all, the benefits of BSc. Statistics are endless. They not only help in timely changes. But also provide better business development plans. All these things lead to the great functioning of your company/organization. Here are five reasons why BSc. Statistics are so important.

Proper business statistics help to make good decisions

The data produced in statistics is very useful for making decisions. Simultaneously, you use this data to know the patterns of your business. Starting from the repetition of mistakes. And end to the steps that lead to success. Gradually, you will also be able to determine everything. In simple words, you can use your past to reshape your future. (In this case, you use business history to shape its future)

This helps to make better business choices. The best choices. Likewise, your overall decision-making will be improved. And you also have proof of the working of reliable policies. You can, therefore, easily use it for making business plans in the future.

Following this, good decisions would be taken. These strong decisions will eventually lead to overall progress. Your business will then grow beyond imagination.

Performance management is improved with the help of business statistics

Performance management is the act of estimating the performance of workers. This includes many things. For instance,

  • The productivity of a particular employee
  • The value they add to your company
  • Their input in causing successful results
  • Their work and effort on a certain project, etc., are some to name.

Now, what is the use of performance management after all? I’ll tell you the reason. By doing this, you get to know how your employees perform. Followed by this, you can assign them to work respectively in the next project. Moreover, their strengths will be examined. And the weaknesses of your employees will be realized.

All this information is taken from the calculation of BSc. Statistics. Likewise, you can use it to generate positive outcomes later.

For more powerful market research

Market research is the action of researching product value in the market. In particular, it focuses on the needs of the buyers. This includes finding solutions to many questions.

The questions revolve around: –

  • Which products are in higher demand in the market?
  • How much money are people ready to pay for selective goods?
  • Do customers easily accept new products?

It will also include an evaluation of product use in the market.

BSc. Statistics are used to fund highly demanded products. Moreover, planning about the marketing of the product is also done.

This will complete in two steps.

  • The first step includes launching the product.
  • And the second step is advertising it in the market.

Both these steps contribute to the successful launch and marketing of a product.

To know more about customer needs and demands

We have already discussed market research in the above section. Powerful market research will help to know your customers’ wants. It also allows you to make business changes. These are based on customer needs. This can be accomplished through BSc. Statistics.

And as a result, you end up meeting your customers’ needs. It leads to better customer relationships. At the same time, you understand your target audience better.

Evaluating alternative scenarios

Alternative scenarios refer to predicting outcomes of differing decisions. With the help of business statistics, you can evaluate unusual decisions. After this, the desirable results of these decisions can be evaluated.

This is done by listing out every decision that can be taken. You can then easily determine the future results of certain decisions.

Calculations about do’s and don’ts finally lead to deciding different tasks. You have the power to look from all angles. These angles cover up almost every risk. Following is, you can quickly overcome the errors in your system.

By now, you may have understood the importance of B.Sc. Statistics. Its role in business management is the same as pictures in a children’s book. Just like children’s books can be printed without pictures. Similarly, you can run your business without B.Sc. Statistics. But that is not enough. There is no use in printing children’s books without pictures. No child will read them. (Not even a nerd)

Similarly, planning your business without BSc. Statistics are useless. Sooner or later, you are going to face problems. Eventually, these problems will be harder to get over in the long run. It is, therefore, very important to carry out proper BSc. statistics.

You can also read our blog on B.Sc Mathematics or B.Sc Statistics.

A career in Business Statistics

Are you looking for a part-time job? Or maybe a job that not only increases your knowledge but also helps you make money from home? Do you have an interest in online tutoring? If yes, you can easily register yourself as a subject matter expert at Chegg.

If you are a business student, a PhD scholar, or someone who has enough knowledge about subjects like accounting and Finance, becoming a subject matter expert at Chegg will help you make money easily by answering the subject-related questions.

The process consists of 3 simple steps including:

  1. Registration
  2. Online Screening
  3. Verification.

Moreover, Chegg India’s website is dedicated to students. On it, you can find all career-related information within no time. Not just that, you can even find part-time and full-time job ideas.

All in all, Chegg has a lot to offer.

  • Firstly, they have a special career guidance blog. Here, you find articles related to your career.
  • Secondly, you can find ways to earn money through these blogs.
  • And lastly, you can become a subject matter expert who can answer subject-related questions online on the 24*7 Chegg study portal. Answer anytime anywhere and earn more by answering regularly. So register now!

So, what are you waiting for? Sign Up to become an expert now!

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