Question

When collecting performance measures on a system (either one that is soon to be replaced, or one that has recently been implemented), business analysts will often consider the volume or sample size of performance measures, as well as their currency.

a) What can be some of the problems with being able to obtain reliable information in regards to the volume or sample size of measurements? What sort of compromise may be required in this regard?

b) What impact does the currency of measurements have on the quality of measurements obtained?

Answer 1

ANSWER:

A)

• The sample size evaluation primarily depends on the study design and the outcome which is estimated prior to the start of the study. The determination varies with the statistical inference of the study which is done by either confidence interval technique (estimation) or test of significance procedure (hypothesis testing).
• The factors affecting sample sizes are
• study design, method of sampling, and outcome measures effect size, standard deviation, study power, and significance level.
• The differences exist between the different types of study design alike description and analytical study. In general, the descriptive studies such as questionnaire and surveys require large sample size than analytical studies. All observational studies require more samples than the experimental studies. The estimation varies with the grouping, control, and population size in randomized clinical trials, observational and epidemiological studies. The studies of nonrandomized clinical study, multiple grouping, require more samples. The qualitative data outcome measures require more samples than the quantitative data.
• The sample size for a study can be calculated from the standard deviation, significance, power, and effect size.The standard deviation and effect size can be either determined from previous studies from literature or from pilot studies. The investigator's consideration on the effect of study plays a critical role in sample size estimation. If the investigator prefers to detect small effect size, it shall be better appreciated with an increased sample size.
• The significance level (type 1 error) and the power of the study are fixed before the study. The significance level is normally set at 0.05 or 0.01. For more accuracy, the significance level should be set at lower levels which increase the sample sizes. Anything more than these two levels can affect the study impact and should be done with caution unless it is essential for the study design. For appreciable inference, the power is normally set at 20% chance of missing difference or 80% chance of detecting a difference as statistically significant. This shall provide appreciable study impact.
• Numerous methods are listed in literature to estimate the sample size. The researcher should adapt an effective, simple, and consistent system. Negligible errors in formula, grouping, statistical baseline values, study design, and the outcome measures can lead to faulty estimation with major impact on the external validity of the study. It is essential to consider all vital issues, more importantly the loss during follow-up. Nearly 10% of additional samples should be considered to the computed sample size for the follow-up loss.
• The sample sizes are determined by nomograms, formulas, tables, and software.[7,8] There are published statistical tables, which provide the sample size for various situations. The statistical tables determine the sample sizes based on efficacy, confidence levels, and variability. It is an easier method comparatively but has assumptions and variability. Similar to the statistical tables, the nomograms determine the sample size with the effect size, standard difference, and confidence interval.
• The formula for sample size estimation varies with the type of study designs. It is the more effective way in determining the sample size. It is cumbersome and difficult to the beginners and hence it is wise to take the help of a statistician before the start of the study. The easiest way to determine sample size is with the software. The sample size is determined by software using a target variance, power of statistical test, and confidence interval. G*Power, PS, Russ Lenths power, Minitab, Stata, R package, PASS, and SampSize app are some of the software available to determine the sample size. Unlike using the complicated formulae, these software programs have made the calculation easier and simpler. A caution has to be ascertained during the use of these tools. Understanding

B)

• Currency management is a vital element of international investment. When an individual or company invests in a foreign asset, in addition to the return (hopefully a gain or, if it goes wrong, a loss!) they will see on the investment itself, they will also see a return on the currency which was used to invest.
• Values of currencies are constantly rising and falling. You may have noticed it on the exchange rates boards when you queue up at the Bureau de Change to get your holiday pennies). This is a risky business for the investor! It can have a major impact on the overall return on investment, as there is the risk that a loss in the currency return will seriously eat into actual returns from the asset. In some cases it could even outweigh it
• Currency management teams consist of strategists in a research and strategy department who can use their exceptional mathematical abilities combined with quantitative analysis to calculate risk in different currency investments. They utilise lots of economic and market data to help them calculate the hedge for each currency. The credit team will conduct research into potential investments on behalf of clients; whilst it the job of the portfolio managers to liaise with clients, pitch strategy suggestions that have been tailored to their needs, update them on progress and discuss any changes to hedging and network to source potential new clients. They can also advise on Forex trading.
• Specialist currency firms and investment banks provide the pickings for currency management roles. It a graduate area of recruitment and a competitive one at that! Candidates with finance-related degrees, top academic profiles and relevant work experience are sought-after in this industry.
• This way currency of management impacts quality of management.