What is Statistics?

In today’s world, we are constantly being bombarded with statistics and statistical information.
For example: Customer Surveys, Transactional Data, Marketing Information, Personal Information, among others.

Key questions to answer are:
How can we make sense out of all this data?
How do we differentiate valid from flawed claims?

Suppose you work for a computer manufacturer and measure customer satisfaction with its products. Your target is 80%, and the first 1,000 surveys give an average score of 82%. The point estimate exceeds the target, but assess the sampling design and uncertainty before concluding that the customer population meets it. Also examine variation across questions and customer groups: an overall average can hide many low ratings and dissatisfied customers. Those problems can threaten the product’s success even when the average looks encouraging; the average alone does not predict whether it will survive in the market.

Thus, knowing only some arbitrary measurements within or outside Specification Limits doesn’t prove much about the real performance and quality. However, only statistics can reveal here the performance and quality and this is why Six Sigma is great, powerful and better than other gut-feeling oriented improvement methodologies.

So, what is statistics then? Statistics is a way to get reliable information from data.

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What is Statistics?

Statistics is a tool for creating new understanding from a set of numbers. Statistics can be better understood under two branches:

1. Descriptive Statistics
2. Inferential Statistics