What are some uses of statistics in business?
Quick Answer
Internally, companies use statistics to evaluate employee performance and to make financial decisions. Statistics gathered through external research are used to enhance products and services and to build effective promotional campaigns, according to Audra Bianca for the Houston Chronicle.
Continue ReadingFull Answer
The use of stats to analyze workers is known as performance management. A simple application is the comparison of actual sales or production levels against quotas or projections. If a salesperson is projected to sell $200,000 in goods during a month, an actual total of $150,000 is 25 percent short of the goal. Aside from extenuating circumstances, a manager would likely discuss this shortage with the rep, notes Bianca.
The Society of Actuaries indicates that many company employee actuaries use math and statistical analysis to make recommendations on financial decisions. Insurance providers use actuarial work to evaluate underwriting decisions and premiums. Statistical analysis takes out some of the guesswork and minimizes the risk of an investment.
In evaluating a potential product or service development, companies conduct research and analyze statistics on unmet needs. The goal is to figure out which goods and services are desired the most by a target market, according to Bianca. Marketing research data is also used to identify the most important benefits in an offering so the company can promote its brand as effectively as possible.
Learn more about Financial CalculationsRelated Questions
-
Q:
What is KPI?
A: KPI stands for key performance indicator. A KPI is a metric used to evaluate a company's or department's performance relative to its competitors and to its... Full Answer >Filed Under: -
Q:
How do you use finance statement templates?
A: Individuals use financial statement templates to create reports that evaluate the financial strength, performance and liquidity of a company, according to ... Full Answer >Filed Under: -
Q:
How do you work out the hourly rate of an employee from the annual salary?
A: To work out the hourly rate of an employee using their annual salary divide the annual salary by the number of hours worked during the year. A similar calc... Full Answer >Filed Under: -
Q:
What is the cost for a salary?
A: The costs of hiring an employee are typically 1.25 to 1.4 times the base salary range, therefore, a salary of 50,000 a year will actually cost an employer ... Full Answer >Filed Under:
