Professional Documents
Culture Documents
- GAURAV GOYAL
(LECTURER)
03/10/10 1
CONTENTS
INTRODUCTION
BROAD CLASSIFICATION
WHAT IS STATISTICS?
CHARACTERISTICS OF STATISTICAL
DATA
STATISTICAL METHODS:CLASSIFICATION
OPERATION RESEARCH MODELS
SOME STATISTICAL TECHNIQUES
ADVANTAGES OF QT TO
MANAGEMENT
QT IN BUSINESS AND MANAGEMENT
03/10/10 2
INTRODUCTION
BEFORE INDUSTRIAL REVOLUTION AFTER INDUSTRIAL REVOLUTION
ision based on past experience
Decisionand
making
intuition
got complicated and quantitative techn
REASONS
1. Complexity of today’s managerial activities
em since customers 2were
. Availability of owner
known to the different
. type of tools for quantitative analysis of
3. Availability
eded since choice and of customer
requirement of high speed
wascomputers
known. to apply the quantitative techni
uired since manager used to work with the workers at the shop floor level.
t required since progress was recorded daily at the work centre.
uired by the owner for decision making were known to him.
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BROAD CLASSIFICATION
QUANTITATIVE TECHNIQUES
STATISTICAL TECHNIQUES
OPERATION RESEARCH (OR PROGRAMMING) TECHNIQU
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WHAT IS STATISTICS?
MISCONCEPTION
tion, analysisPeople
, interpretation and presentation
sometimes refer of of
it as a group numerical
data butdata .
actually it
APPLICATION
nce of statistics
Provides
is based
tools
on for
mathematical
predictionthought
and forecasting
and derivation
using. data a
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CHARACTERISTICS OF STATISTICAL
DATA
Must be aggregate of facts
Should be affected to a marked
extent by multiplicity of causes
Must be enumerated / estimated to
a certain standard of accuracy.
Must have been collected in a
systematic manner for a pre-
determined purpose.
Must be placed in relation to each
other
Must be numerically expressed.
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STATISTICAL
METHODS:CLASSIFICATION
STATISTICAL METHODS
03/10/10 7
CONTINUED……
collection of data.
APPLIED STATISTICS
ount for randomness and uncertainty and then used to draw inferences about the po
03/10/10 8
DESCRIPTIVE
STATISTICS(EXAMPLE)
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INFERENTIAL STATISTICS (EXAMPLE)
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STATISTICAL DECISION THOERY
Deals with analyzing complex
business problems with alternative
courses of action and possible
consequences.
Relies on:-
a) nature of problem
b) decision environment
STATE OF DECISION CONSEQUENCES
Certainty Deterministic
Risk Probabilistic
Uncertainty Unknown
Conflict Influenced by opponent
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OPERATION RESEARCH
MODELS
MODELS BASED ON PURPOSE
DESCRIPTIVE MODEL EXPLANATORY MODEL
be the behavior
1.Used
of atosystem
explain
based
behavior
on certain
of system
information
by establishing
. relationship bet
roblem situation more vividly including the alternative choices.
for
explain
a inventory
variations
iteminfor
productivity
a stated period
by establishing
by keeping relation
record ofamong
demand
thelevels
factors
andsut
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OPERATION RESEARCH
MODELS
MODELS BASED ON PURPOSE
PREDICTIVE MODEL PRESCRIPTIVE MODEL
redict status
1.Provides
of a system
norms for
in the
comparison
near future
of alternative
based on data
solutions
. to select the be
redict stock prices for any given level of earning per share (EPS).
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OPERATION RESEARCH
MODELS
MODELS BASED ON DEGREE OF ABSTRACTION
PHYSICAL MODEL GRAPHIC MODEL SCHEMATIC MODEL
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OPERATION RESEARCH
MODELS
MODELS BASED ON DEGREE OF ABSTRACTION
ANALOG MODEL MATHEMATICAL MODEL
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OPERATION RESEARCH
MODELS
MODELS BASED ON DEGREE OF CERTAINTY
DETERMINISTIC MODEL PROBABILISTIC MODEL
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OPERATION RESEARCH
MODELS
MODELS BASED ON SPECIFIC BEHAVIOR
CHARACTERISTICS
STATIC MODELS DYNAMIC MODEL
icular
on-makerset
hasoftofixed
make conditions
a sequence and
of optimal
do not change
decisions
in aatshort
every
-term
decision
period.point rega
only
on changes
one decision
over a required
period offor
timea. period.
03/10/10 17
Link for Excel
http://www.free-training-tutorial.com/format-cells.htm
03/10/10 18
03/10/10 19
OPERATION RESEARCH
MODELS
MODELS BASED ON SPECIFIC BEHAVIOR
CHARACTERISTICS
LINEAR MODELS NON - LINEAR MODELS
e.g. e.g.
Z = 5 + 3x Z = 5x2 + 3xy + y2
03/10/10 20
OPERATION RESEARCH
MODELS
MODELS BASED ON PROCEDURE OF SOLUTION
ANALYTICAL MODELS SIMULATION MODELS
and1.Is
solved
the experimentation
by known mathematical
on a mathematical
or analytical
structure
techniques
of real
to yield
life asystem
general
. sol
2.Done by inserting specific values of decision variables into the given stru
ar programming, game
e.g. theory
test effect
modelsof
, inventory
differentcontrol
number models
of service
etc counters based on
03/10/10 21
Measures of Location
■Mean
03/10/10 22
Mean
The mean of a data set is the
average of all the data values.
x
The sample mean is the point
estimator of the population mean
µ .
03/10/10 23
Sample Mean x
Sum
Sum ofof the
the values
values
of
of the
the nn observations
observations
∑x i
x=
n
Number
Number ofof
observations
observations
in
in the
the sample
sample
03/10/10 24
Population Mean µ
Sum
Sum ofof the
the values
values
of
of the
the N
N observations
observations
∑x i
µ=
N
Number
Number ofof
observations
observations in
in
the
the population
population
03/10/10 25
Sample Mean
03/10/10 26
Sample Mean
03/10/10 27
Sample Mean
x=
∑ x i
=
34,356
=490.80
n 70
445 615 430 590 435 600 460 600 440 615
440 440 440 525 425 445 575 445 450 450
465 450 525 450 450 460 435 460 465 480
450 470 490 472 475 475 500 480 570 465
600 485 580 470 490 500 549 500 500 480
570 515 450 445 525 535 475 550 480 510
510 575 490 435 600 435 445 435 430 440
03/10/10 28
Median
n The median of a data set is the value in the middle
when the data items are arranged in ascending order.
n Whenever a data set has extreme values, the median
is the preferred measure of central location.
n The median is the measure of location most often
reported for annual income and property value data.
n A few extremely large incomes or property values
can inflate the mean.
03/10/10 29
Median
26 18 27 12 14 27 19 7 observations
12 14 18 19 26 27 27 in ascending order
Median = 19
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Median
26 18 27 12 14 27 30 19 8 observations
12 14 18 19 26 27 27 30 in ascending order
03/10/10 31
Median
Averaging the 35th and 36th data values:
Median = (475 + 475)/2 = 475
425 430 430 435 435 435 435 435 440 440
440 440 440 445 445 445 445 445 450 450
450 450 450 450 450 460 460 460 465 465
465 470 470 472 475 475 475 480 480 480
480 485 490 490 490 500 500 500 500 510
510 515 525 525 525 535 549 550 570 570
575 575 580 590 600 600 600 600 615 615
Note: Data is in ascending order.
03/10/10 32
Mode
n The mode of a data set is the value that occurs with
greatest frequency.
n The greatest frequency can occur at two or more
different values.
n If the data have exactly two modes, the data are
bimodal.
n If the data have more than two modes, the data are
multimodal.
03/10/10 33
SOME STATISTICAL
TECHNIQUES
MEASURES OF CENTRAL TENDENCY
1.MEAN: Computed by dividing sum of
the values of observations by the
number of items.
2.MEDIAN: Item which lies exactly
midway between the lowest and
the highest value when data is
arranged in ascending or
descending order.
3.MODE: It is the central value that
occurs most frequently.
03/10/10 34
SOME STATISTICAL
TECHNIQUES
MEASURES OF DISPERSION
The difference between the
maximum and the minimum value
of a distribution is called the
measure of dispersion.
1.SKEWNESS: the measure of the
direction and degree of symmetry
are called measures of skewness
2.KURTOSIS: The measure of
peakedness in a distribution is
called Kurtosis.
03/10/10 35
SKEWNESS AND KURTOSIS
03/10/10 36
SOME STATISTICAL
TECHNIQUES
CORRELATION
àIt measures the degree to which the
change in the dependent variable
is associated with change in the
independent variable.
REGRESSION ANALYSIS
àUsed for determining the causal
relationship between 2 variables.
TIME SERIES ANALYSIS
àConsists of a set of data recorded
over successive periods of time.
àMeasures the effect of the following
03/10/10 37
SOME STATISTICAL
TECHNIQUES
TIME SERIES ANALYSIS
àConsists of a set of data recorded
over successive periods of time.
àAnalysis is done on the above data
taking the periodic changes,
cyclical changes, seasonal
variations and random variations
into consideration.
03/10/10 38
ADVANTAGES OF QT TO
MANAGEMENT
Definiteness
Condensation
Comparison
Formulation of policies
Formulating and testing hypothesis
Prediction
03/10/10 39
QT IN BUSINESS AND
MANAGEMENT
MANAGEMENT
i) Marketing:
analysis market research
information
Statistical records for building
and maintaining an extensive market
Sales forecasting
ii) Production
Production planning, control and
analysis
Evaluation of machine
performance 03/10/10 40
QT IN BUSINESS AND
MANAGEMENT
iii) Finance, Accounting and
Investment:
financial forecast, budget
preparation
financial investment decisions
Selection of securities
Auditing function
iv) Personnel
labour turnover rate
employment trends
performance appraisal
wage rates and incentive plans
03/10/10 41
QT IN BUSINESS AND
MANAGEMENT
ECONOMICS
measure of GNP.
determination of business cycle.
comparison of market prices
etc.
analysis of population
formulation of appropriate
economic policies
RESEARCH AND DEVELOPMENT
development of new product
lines
optimum use of resources
03/10/10 42