“Statistics”, that a word is often used, has been derived from the Latin word ‘Status’ that means a group of numbers or figures; those represent some information of our human interest.
We find statistics in everyday life, such as in books or other information papers or TV or newspapers.
Although, in the beginning it was used by Kings only for collecting information about states and other information which was needed about their people, their number, revenue of the state etc.
This was known as the science of the state because it was used only by the Kings. So it got its development as ‘Kings’ subject or ‘Science of Kings’ or we may call it as “Political Arithmetic’s”. It was for the first time, perhaps in Egypt to conduct census of population in 3050 B.C. because the king needed money to erect pyramids. But in India, it is thought, that, it started dating back to Chandra Gupta Maurya’s kingdom under Chankya to collect the data of births and deaths. TM has also been stated in Chankya’s Arthshastra.
But now-a-days due to its pervading nature, its scope has increased and widened. It is now used in almost in all the fields of human knowledge and skills like Business, Commerce, Economics, Social Sciences, Politics, Planning, Medicine and other sciences, Physical as well as Natural.
The term ‘Statistics’ has been defined in two senses, i.e. in Singular and in Plural sense.
“Statistics has two meanings, as in plural sense and in singular sense”.
In plural sense, it means a systematic collection of numerical facts and in singular sense; it is the science of collecting, classifying and using statistics.
A. In the Plural Sense:
“Statistics are numerical statements of facts in any department of enquiry placed in relation to each other.” —A.L. Bowley
“The classified facts respecting the condition of the people in a state—especially those facts which can be stated in numbers or in tables of numbers or in any tabular or classified arrangement.” —Webster
These definitions given above give a narrow meaning to the statistics as they do not indicate its various aspects as are witnessed in its practical applications. From the this point of view the definition given by Prof. Horace Sacrist appears to be the most comprehensive and meaningful:
“By statistics we mean aggregates of facts affected to a marked extent by multiplicity of causes, numerically expressed, enumerated or estimated according to reasonable standard of accuracy, collected in a systematic manner for a predetermined purpose, and placed in relation to each other.”—Horace Sacrist
B. In the Singular Sense:
“Statistics refers to the body of technique or methodology, which has been developed for the collection, presentation and analysis of quantitative data and for the use of such data in decision making.” —Ncttor and Washerman
“Statistics may rightly be called the science of averages.” —Bowleg
“Statistics may be defined as the collection, presentation, analysis, and interpretation of numerical data.” —Croxton and Cowden
Stages of Investigations:
1. Collection of Data:
It is the first stage of investigation and is regarding collection of data. It is determined that which method of collection is needed in this problem and then data are collected.
2. Organisation of Data:
It is second stage. The data are simplified and made comparative and are classified according to time and place.
3. Presentation of Data:
In this third stage, organised data are made simple and attractive. These are presented in the form of tables diagrams and graphs.
4. Analysis of Data:
Forth stage of investigation is analysis. To get correct results, analysis is necessary. It is often undertaken using Measures of central tendencies, Measures of dispersion, correlation, regression and interpolation etc.
5. Interpretation of Data:
In this last stage, conclusions are enacted. Use of comparisons is made. On this basis, forecasting is made.
Some Modern Definitions:
From the above two senses of statistics, modem definitions have emerged as given below:
“Statistics is a body of methods for making wise decisions on the face of uncertainty.” —Wallis and Roberts
“Statistics is a body of methods for obtaining and analyzing numerical data in order to make better decisions in an uncertain world.” —Edward N. Dubois
So, from above definitions we find that science of statistics also includes the methods of collecting, organising, presenting, analysing and interpreting numerical facts and decisions are taken on their basis.
The most proper definition of statistics can be given as following after analysing the various definitions of statistics.
“Statistics in the plural sense are numerical statements of facts capable of some meaningful analysis and interpretation, and in singular sense, it relates to the collection, classification, presentation and interpretation of numerical data.”
Statistics is the branch of mathematics used to collect, analyze, interpret, and present data. It is used by business owners to make calculated decisions regarding the future of their companies. Types of Statistics There are two types of statistics. Descriptive statistics deal with describing a set of data elements graphically. This type of statistic does not make any sort of prediction, but rather shows bullet point type data. An example of descriptive statistics would be a plot line graph that reflects the United States population by year for the last ten years.
A person looking at this data would easily be able to determine how the population has increased or decreased in the past decade. The data would be insufficient however to determine what the population will be ten years from now. The second type of statistics is Inferential statistics. Inferential statistics uses a sampling of information to infer a future outcome. This is often referred to as the ‘best guess’ method of statistics. This type of information is what is used by businesses in particular to make educated decisions for future planning.
Levels of Statistics There are also many levels of statistics. Nominal level statistics portray objects by name or by a label. Ordinal level statistics has ordered data such as by number or by letter. Interval level statistics has data ordered by the differences or intervals between the data. An example would be a thermometer labeled in degrees Celsius. These are all useful ways to organize data, but the more reliable and widely used level is Ratio level statistics.
In ratio statistics there is a natural zero starting point. This one fact gives the intervals between data actual meaning. A person can actually compare measurements using the ratio method. Business Decisions. All business owners want to succeed in their chosen field. The most logical way for a company to obtain longevity is to remain educated about what their business will face in the future. Statistics are used in this capacity. A company will prosper if it is able to use statistical data to make sound business decisions.
For example, a manager of a warehouse is aware that from November through January they will need to add 5 employees to their staff in order to meet the demands of their customers. This manager knows this because it is a trend that is reflected by statistics published by the sales department. The manager knows that in order to be successful throughout the season of higher demand there needs to be an allowance in the budget for salaries for these 5 extra workers. The statistics presented to management allows for proper planning.
Some Common Problems. In any business there are many factors to consider when an owner is looking at the possibility of expanding. Statistics based on a certain demographical area will help to choose an affluent location where the business will prosper. Another situation statistics play a major role in is financing. In order for a new business to obtain funding a business plan is needed. Statistics are presented by the aspiring business owner in the business plan to show the need for what he or she has to offer.
These statistics are also used by the financing entity to determine the risk factor within an industry. Things of this nature can greatly affect the outcome of a business loan. A more foreboding problem some businesses face is whether or not to lay off employees. Statistics are used in this case to determine how many people would need to be laid off from jobs to keep the company afloat. This is a harsh problem for a company to face, but it is a situation many businesses have found themselves dealing with in recent years.
This is an even more important reason to have reliable and trustworthy statistics available to aide in the decision making process. The overall idea of statistics used in business is to make beneficial and financially sound decisions. The more facts that are involved in any decision making process the better. In business the owner of a company has a responsibility to act intelligently when making decisions that will affect multiple employees and their families. Statistics are the main tools needed for a successful business structure.