Explain the role and importance of mathematics and statistics in business decision making?

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Nicole Manion answered
Statistics are being used more and more as companies continue to expand their enterprises across the globe. With the advancements in technology to, companies are able to access figures that reflect the facts of how certain areas of their businesses are doing and, more importantly, how to improve and become more efficient.

  • Examples of technology used to collate data

MISs, or Management Information Systems, are one of the many tools that businesses use to inform the people in charge of making the important decisions and implementing strategies that are aimed at taking the company forward. These systems gather a variety of information from each department and their records, that ranges from expenditure, turnover, profits, sick leave of staff, taxes and benefits, sales, product popularity, costs of advertisement, employment figures etc and aims to put all that information into mediums that can be analyzed.

Without the ability to identify trends and projections in the markets then whole departments within companies would cease to exist. As they say 'knowledge is power' and in the context of competing businesses like Apple and Microsoft, much of what they have achieve is down to the ability to implement successful business models like these that deal with the statistics.

  • Why these facts are vital

What is so important about the simple numbers and statistics is that they represent reality in a way that an individual could not. Statistical facts are at least a closer representation to the truth given that they have been initiated by employees asking specific questions about very general and specific areas. In this way statistics offer businesses a completely un-bias and objective perspective. It is not that they disregard people's opinions but they recognize that they only represent one perspective.  Statistics however, are a collective representation of preferences which have been gathered, in some sense, without the individual's realization that their decision has been noted for analysis; again adding to the total impartiality of statistical information.

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