Question

Critical analysis of business statistics based on the evolution of statistics approved by companies and preparation of a report covering the basic aspects of business statistics.

Answer 1

Statistics:

--> For a layman,"Statistics" means numerical information expressed in quantitative terms.

--> This information may relate to objects, subjects, activities, phenomena, or regions of space.

--> As a matter of fact, data have no limits as to their reference, coverage, and scope.

--> At the macro level, these are data on gross national product and shares of agriculture, manufacturing, and services in GDP (Gross Domestic Product).

--> At the micro level, individual firms, howsoever small or large, produce extensive statistics on their operations.

* Meaning and Definitions:

--> According to A.L. Bowley statistics as:

(i) statistics is the science of counting,
  
(ii)Statistics may rightly be called the science of averages, and

(iii) statistics is the science of measurement of social organism regarded as a whole in all its manifestations.

--> Spiegal defines statistics highlighting its role in decision-making particularly under uncertainty.

  
* Characteristics:

--> Statistics are the aggregates of facts.

--> Statistics are affected by a number of factors.

--> Statistics must be reasonably accurate.

--> Statistics must be collected in a systematic manner.

Business Statistics:

* Many businesses use statistics to evaluate performance. Business statistics involves aspects of math, management and market research that aid in the decision
making process within a business

There are three major functions in any business enterprise in which the statistical methods are useful.

-->a.The planning of operations: This may relate to either special projects or to the recurring activities of a firm over a specified period.

-->b. The setting up of standards: This may relate to the size of employment,volume of sales, fixation of quality norms for the manufactured product,
norms for the daily output, and so forth.

-->c.The function of control: This involves comparison of actual production achieved against the norm or target set earlier.
In case the production has fallen short of the target, it gives remedial measures so that such a deficiencydoes not occur again.

* Different authors have highlighted the importance of Statistics in business:

--> Croxton and Cowden give numerous uses of Statistics in business such as project planning, budgetary planning and control, inventory planning and control,
quality control, marketing, production and personnel administration.

--> Irwing W. Burr, dealing with the place of statistics in an industrial organisation,specifies a number of areas where statistics is extremely useful.

* Limitations:

--> If sufficient care is not exercised in collecting, analyzing and interpreting the data, statistical results might be misleading.

--> The statistical methods don't study the nature of phenomenon which cannot be expressed in quantitative terms.

--> The use of statistics is limited to numerical studies.

--> Statistical results might lead to fallacious conclusions.