Mathematics has never been a plain sailing subject for most of us during our student days and our biggest lifeline then was the calculator. A mathematical exam was powerful enough to fetch you a very high grade or drag down all your efforts into a mere figure. This is because a mistake in a tiny step of calculation, the remaining steps towards the solution become fit only to fill the paper, and finally the waste bin.
The same situation replicates in your carefully constructed business. A single miscalculation in the finance or management can shake the stability and growth of the whole firm. A firm rises considerable funding through long-term debts with the objective of budding a new venture or expansion. If this funding is not systematically planned and channeled towards requirements and instead diverted to unrelated directions, the entire financial planning and business operations go hay-wire.
The application of mathematical calculations in a systematic and interpretative way to draw the inference to scale up and plan for the future of the business is business statistics and does the job of constructing and operating your business in terms of financial numbers.
Tools of business statistics
Statistics works with numbers, using both theoretical and practical tools. The main platform for applying the analysis to the data and inference drawing is the spreadsheet. The data are described theoretically and based on real facts and also represented visually using tools for full-spectrum analysis, validation, and consolidation.
The primary task in statistical analysis is to determine what kind of approach is to be adopted to represent the data. Once the approach is finalized, the next step is to select the technique that is best capable of tackling the situation. For example, if the mission is problem-solving in any section of the data source, like low result in cost comparison, unexplainable reduction in profits, excess capital investment in any operation etc or going in a more specific way like closing all loopholes for loss in Crypto Code software, improving prediction etc.
If the solution requires a programming technique, the next step will be to apply the interpreted data to the codes, sometimes by formulating a hypothesis. The further development of statistical analysis of the business data may employ theorems and formulae for extracting inference; pivot tables, random sampling, Central Limit Theorem, t-test, Black-Scholes formula, Bayes rule, correlation, regression etc being the simplest ones to be used.
You complete the cycle with the final result by including risk assessment, market prediction, and statistical modeling.