1. A PowerPoint Presentation Package to Accompany Applied Statistics in Business & Economics 2nd edition David P. Doane and Lori E. Seward
McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

2. Overview of Statistics1
Overview of Statistics
Chapter
What is Statistics?
Why Study Statistics?
Uses of Statistics
Statistical Challenges
Writing and Presenting Reports
Critical Thinking
Statistics: An Evolving Field

3. What is Statistics?
Statistics is the science of collecting, organizing, analyzing, interpreting, and presenting data.
A statistic is a single measure (number) used to summarize a sample data set. For example, the average height of students in this class.
A statistician is an expert with at least a master’s degree in mathematics or statistics or a trained professional in a related field.

4. Communication Computer Skills Why Study Statistics?
Understanding the language of statistics facilitates communication and improves problem solving.
The use of spreadsheets for data analysis and word processors or presentation software for reports improves upon your existing skills.

5. Information Management
Why Study Statistics?
Information Management
Technical Literacy
Statistics help summarize large amounts of data and reveal underlying relationships.
Career opportunities are in growth industries propelled by advanced technology. The use of statistical software increases your technical literacy.

6. Career Advancement Why Study Statistics? Quality Improvement
Statistical literacy can enhance your career mobility.
Statistics helps firms oversee their suppliers, monitor their internal operations and identify problems.

7. Uses of Statistics Two primary kinds of statistics:
Descriptive statistics – the collection, organization, presentation and summary of data.
Inferential statistics – generalizing from a sample to a population, estimating unknown parameters, drawing conclusions, making decisions.

8. Making Inferences from Samples
Uses of Statistics
Overview of Statistics (Figure 1.1)
Statistics
Collecting and
Describing Data
Making Inferences from Samples
Sampling
and Surveys
Visual Displays
Numerical
Summaries
Probability
Models
Estimating
Parameters
Testing
Hypotheses
Regression
and Trends
Quality
Control

9. Auditing Marketing Uses of Statistics
Sample from over 12,000 invoices to estimate the proportion of incorrectly paid invoices.
Identify likely repeat customers for Amazon.com and suggests co-marketing opportunities based on a database of 5 million Internet purchases.

10. Health Care Quality Control Uses of Statistics
Evaluate 100 incoming patients using a 42-item physical and mental assessment questionnaire.
Initiate a triple inspection program, setting penalties for workers who produce poor-quality output.

11. Purchasing Medicine Uses of Statistics
Determine the defect rate of a shipment and whether that rate has changed significantly over time.
Determine whether a new drug is really better than the placebo or if the difference is due to chance.

12. Product Warranty Uses of Statistics Forecasting
Manage inventory by forecasting consumer demand.
Determine the average dollar cost of engine warranty claims on a new hybrid engine.

13. Statistical Challenges
The Ideal Data Analyst
Is technically current (e.g., software-wise).
Communicates well.
Is proactive.
Has a broad outlook.
Is flexible.
Focuses on the main problem.

14. Statistical Challenges
The Ideal Data Analyst
Meets deadlines.
Knows his/her limitations and is willing to ask for help.
Can deal with imperfect information.
Has professional integrity.

15. Statistical Challenges
Working with Imperfect Data
Dealing with Practical Constraints
State any assumptions and limitations and use generally accepted statistical tests to detect unusual data points or to deal with missing data.
You will face constraints on the type and quantity of data you can collect.

16. Statistical Challenges
Upholding Ethical Standards
Using Consultants
Know and follow accepted procedures, maintain data integrity, carry out accurate calculations, report procedures, protect confidentiality, cite sources and financial support.
Hire consultants at the beginning of the project, when your team lacks certain skills or when an unbiased or informed view is needed.

17. Statistical Challenges
Skills Needed for Success in Business
(Table 1.1)
For initial job success
For long-range job success
Common weaknesses
Report-writing
Managerial accounting
Communication skills
Accounting principles
Managerial economics
Writing skills
Mathematics
Managerial finance
Immaturity
Statistics
Oral communication
Unrealistic expectations

18. Writing and Presenting Reports
Rules for Power Writing
Outline the report before you begin.
Complete the report in sections.
Ask trusted peers to review the report and make any necessary revisions.
Be prepared to make multiple revisions.

19. Writing and Presenting Reports
Writing Style
Answer research question succinctly.
List most important results first.
Include section headings and avoid lengthy paragraphs.
Provide clear data sources.
Use appendices for technical information.
Be stylistically consistent.

20. Writing and Presenting Reports
Avoid Jargon
Make It Attractive
Present technical concepts so that others can understand them.
Reports should have a title page, descriptive title, date, and author names.

21. Writing and Presenting Reports
Watch Your Spelling and Grammar
Get someone you trust to red-pencil your work. Don’t rely on software to catch all spelling and grammar errors.

22. Writing and Presenting Reports
Organizing a Technical Report
Typical business report style includes:
Executive Summary (1 page maximum) - Briefly describe task and goals, data and data sources, methods that were used, main findings and any limitations.
Introduction (1 to 3 paragraphs) - Statement of the problem - Data sources and definitions - Methods utilized

23. Writing and Presenting Reports
Organizing a Technical Report
Typical business report style includes:
Body of the Report (as long as necessary) - Discussion, explanations, interpretations - Tables and graphs, as needed
Conclusions (1 to 3 paragraphs) - Statement of findings (in order of importance) - Limitations (if necessary) - Future research suggestions

24. Writing and Presenting Reports
Organizing a Technical Report
Typical business report style includes:
Bibliography and Sources
Appendices (if needed for lengthy or technical material)

25. Writing and Presenting Reports
Tables and Graphs
Tables should be embedded in the narrative near the paragraph in which they are interpreted.
Number and title each table above the table, each graph below the graph.

26. Writing and Presenting Reports
Rules for Presenting Oral Reports
Select a few key points to convey.
Use simple charts and diagrams.
Emphasize using color and fonts creatively.
Avoid gratuitous jokes.
Have backup slides or transparencies.
Rehearse timing.
Refer audience to written report for details.
Imagine yourself in the audience.

27. Writing and Presenting Reports
The Three Ps
Pace yourself when presenting. Take your time, introduce yourself, your data and your project. Make the first minute count.
Plan what your are going to present. Organize your ideas with an outline. Keep it simple!
Practice before presenting to get the timing right. Consider videotaping yourself or practicing in front of peers.

28. Writing and Presenting Reports
Pictures Help Make the Point
(Figure 1.3)

29. Critical Thinking
Statistics is an essential part of critical thinking because it allows us to test an idea against empirical evidence.
Empirical Data represent data collected through observation and experiments.

30. Critical Thinking
Pitfall 1: Making Conclusions about a Large Population from a Small Sample
Pitfall 2: Making Conclusions from Nonrandom Samples
Be careful about making generalizations from small samples (e.g., a group of 10 patients).
Be careful about making generalizations from retrospective studies of special groups (e.g., heart attack patients).

31. Critical Thinking Pitfall 3: Conclusions From Rare Events
Pitfall 4: Using Poor Survey Methods
Be careful about drawing strong inferences from events that are not surprising when looking at the entire population (e.g., winning the lottery).
Be careful about using poor sampling methods or vaguely worded questions (e.g., anonymous survey or quiz).

32. Critical Thinking
Pitfall 5: Assuming a Causal Link Based on Observations
Pitfall 6: Making Generalizations about Individuals from Observations about Groups
Be careful about drawing conclusions when no cause-and-effect link exists (e.g., most shark attacks occur between 12p.m. and 2p.m.).
Avoid reading too much into statistical generalizations (e.g., men are taller than women).

33. Critical Thinking Pitfall 7: Unconscious Bias
Pitfall 8: Significance versus Importance
Be careful about unconsciously or subtly allowing bias to color handling of data (e.g., heart disease in men vs. women).
Statistically significant effects may lack practical importance (e.g., Austrian military recruits born in the spring average 0.6 cm taller than those born in the fall).

34. Statistics: An Evolving Field
Statistics is a relatively young field, having been developed mostly during the 20th century.
Its mathematical frontiers continue to expand with the aid of computers.
Major recent developments include - Exploratory data analysis (EDA) - Computer-intensive statistics - Design of experiments - Robust product design - Advanced Bayesian methods - Graphical Methods…and more

35. Applied Statistics in Business & Economics
End of Chapter 1
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