Statistics can be an excellent resource for any business looking to properly allocate resources in all divisions of the business. From inventory management to scheduling to seasonal trending and everything in between, if you understand and know how to use statistical methods in business properly, these potential problem areas for a company can turn into opportunities to increase a company’s profit margin.
Using a statistical method won't just improve a specific area of your business. Statistical techniques can help identify larger trends in an industry. In a competitive business environment, the ability to spot and use industry trends to your advantage can be the lifeblood of company. A business can use a statistics method like logistics curving or probit curving to forecast the success of new products and know when to retire older products.
Before you implement a statistics process to assist in your business, you should consider the following:
1. Know the basics of statistical process;
2. Decide whether to conduct business statistical analysis in-house or outsource it; and,
3. Have a plan to implement the results of the statistical analysis.
Action Steps
The best contacts and resources to help you get it done
Use Microsoft Excel to test drive statistical methods in business
Microsoft Excel offers plenty of features that will enable a small company with limited funds or a large one that is leery of investing too many resources for the statistical analysis.
I recommend: Take advantage of the software that you already have, in this case
Microsoft Excel, to evaluate just how effective and useful statistical analysis will be for your business. Make sure that you install the
Excel statistical analysis pack on the computer or you will not have access to all the statistical functions in Excel. You will need someone on staff that understands how to input and interpret the data that is relevant to your business. Understand however, that Excel is not as robust as a dedicated statistical analysis software package.
Invest in statistical trending and analysis software
Once you decide to implement statistical analysis in your business, you need a software package to handle the task.
I recommend: After taking the less robust Excel statistical software out for a test drive, you may want to purchase software to conduct in-house statistical analysis of your business. Be certain that you have employees on staff to handle the application and analysis. If not, you may need to hire a statistical analyst. There are many different statistical software programs available such as
SPSS,
SAS, and
Insightful.
Hire someone who knows how to perform the statistics process
To get a proper statistical analysis, you may need to hire an outside firm to perform the analysis.
I recommend: Outsource the business statistical analysis if your company does not have the proper in-house talent or if it is economically inefficient to do so. Feel comfortable with the business statistical methods company that you hire. Examples of companies that can perform this business statistical analysis are
John Galt Solutions, Inc.,
Minimax Consulting and
Chainalytics LLC.
Tips & Tactics
Helpful advice for making the most of this Guide
- Have each division manager at the company take an introduction to statistics course. If the decision-makers within the company do not have a basic understanding of statistical analysis, your company will be at the mercy of the statistician on staff or the outsourcers you hired.
The official source of Statistics and Statistical Methods is
the Statistics and Statistical Methods page at Business.com
Related Resources from Business.com
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