I. INTRODUCTION.

II. STATISTICAL METHODS FOR BUSINESS PLAN.

1. Measures of variability.
1.1. The issue of variability in business processes (e.g. arrival rates of customers and time
taken to deal with customers), and how this leads to a trade-off between waiting time and
process utilization.
1.2. Statistical process control in quality management.

Definition.

SPC is a method of measuring and controlling quality by monitoring the manufacturing process. Quality data is
collected in the form of product or process measurements or readings from various machines or
instrumentation. The data is collected and used to evaluate, monitor, and control a process. SPC is an effective
method to drive continuous improvement. By monitoring and controlling a process, it can be assured operates
at its fullest potential.

Meaning of SPC.

Increased competition in the market, as well as the cost of expensive raw materials, are factors that
companies cannot control and are easily detrimental to them. Therefore, companies must focus on what they
can control, that is their processes. Companies must strive for continuous improvement in quality, efficiency,
and cost reduction. Many companies still rely only on inspection after production to detect quality issues. The
SPC process is implemented to move a company from detection based on prevention-based quality controls.
By monitoring the performance of a process in real-time the operator can detect trends or changes in the
process before they result in non-conforming products and scrap.

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2. Measures of probability.
2.1. Probability distributions and application to business operations and processes.

A probability distribution is a statistical function that describes all the possible values and likelihoods that a
random variable can take within a given range. This range will be bounded between the minimum and
maximum possible values, but precisely where the possible value is likely to be plotted on the probability
distribution depends on a number of factors. These factors include the distribution's mean (average), standard
deviation, skewness, and kurtosis.

The most common probability distribution is the normal distribution, or "bell curve," although several
distributions exist that are commonly used. Typically, the data generating process of some phenomenon will
dictate its probability distribution. This process is called the probability density function. On the other hand,
probability distributions can also be used to create cumulative distribution functions (CDFs), which adds up
the probability of occurrences cumulatively and will always start at zero and end at 100%. Academics, financial
analysts, and fund managers alike may determine a particular stock's probability distribution to evaluate the
possible expected returns that the stock may yield in the future. The stock's history of returns, which can be
measured from any time interval, will likely be composed of only a fraction of the stock's returns, which will
subject the analysis to sampling error. By increasing the sample size, this error can be dramatically reduced.
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2.2. Normal distribution (e.g. weights and measures regulations and statistical process
control),

The normal distribution, also known as the Gaussian distribution, is a probability distribution that is symmetric
about the mean, showing that data near the mean are more frequent in occurrence than data far from the
mean. In graph form, normal distribution will appear as a bell curve. The normal distribution is the most
common type of distribution assumed in technical stock market analysis and in other types of statistical
analyses. The standard normal distribution has two parameters: the mean and the standard deviation. For a
normal distribution, 68.3% of the observations are within +/- one standard deviation of the mean, 95.5% are
within +/- two standard deviations, and 99.7% are within +- three standard deviations.
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2.3. Poisson distribution (e.g. customer arrival rates) and binomial distribution (e.g.
inspection sampling).

The Poisson distribution is a discrete distribution that measures the probability of a given number of events
happening in a specified time period. In finance, the Poisson distribution could be used to model the arrival of
a new buy or sell orders entered into the market or the expected arrival of orders at specified trading venues
or dark pools. In these cases, the Poisson distribution is used to provide expectations surrounding confidence
bounds around the expected order arrival rates. Poisson distributions are very useful for smart order routers
and algorithmic trading.

There are two conditions that must be met in order to use a Poisson distribution. First, each successful event
must be independent. The second is the probability of success over a short interval must equal the probability
of success over a longer interval.

Poisson distribution formula :

https:// www.sciencedirect.com/topics/mathematics/poisson-distribution

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The binomial distribution is a probability distribution that summarizes the likelihood that a value will take one
of two independent values under a given set of parameters or assumptions. The underlying assumptions of
the binomial distribution are that there is only one outcome for each trial, that each trial has the same
probability of success, and that each trial is mutually exclusive, or independent of each other. For example, a
coin toss has only two possible outcomes: heads or tails, and taking a test could have two possible outcomes:
pass or fail.

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2.4. Inference (e.g. margins of error and confidence limits).

According to Leon (2016), the inferential statistics is the process of making predictions about data from
samples and generalizing the whole population. In other words, a researcher does not need to access the
whole population while he just needs to investigate only a limited number of data. In order to infer
population, mean from a sample, it follows the formula: μ=(ΣX)/N whereas ΣX is the sum of all sample
observations and N is the number of sample observations.

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3. Application in an organization context.

4. Recommendations & Judgements.
III. COMMUNICATE FINDINGS USING APPROPRIATE CHARTS/TABLES.
1. Different Variables.

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1.1. Nominal Variable.

A nominal variable is a type of variable that is used to name, label, or categorize particular attributes that are
being measured. It takes qualitative values representing different categories, and there is no intrinsic ordering
of these categories. Nominal variables can be coded with numbers, but the order is arbitrary and arithmetic
operations cannot be performed on the numbers. This is the case when a person’s phone number, National
Identification Number postal code, etc. are being collected. A nominal variable is one of the 2 types of
categorical variables and is the simplest among all the measurement variables. Some examples of nominal
variables include gender, name, phone, etc.

1.2. Ordinal Variable.

The ordinal variable is a type of measurement variable that takes values with an order or rank. It is the second
level of measurement and is an extension of the nominal variable. They are built upon nominal scales by
assigning numbers to objects to reflect a rank or ordering on an attribute. Also, there is no standard ordering
in the ordinal variable scale. In another sense, we could say the difference in the rank of an ordinal variable is
not equal. It is mostly classified as one of the 2 types of categorical variables, while in some cases it is said to
be a midpoint between categorical and numerical variables.

1.3. Interval Variable.

The interval variable is a measurement variable that is used to define values measured along a scale, with
each point placed at an equal distance from one another. It is one of the 2 types of numerical variables and is
an extension of the ordinal variable. Unlike ordinal variables that take values with no standardized scale, every
point in the interval scale is equidistant. Arithmetic operations can also be performed on the numerical values
of the interval variable. These arithmetic operations are, however, just limited to addition and subtraction.
Examples of interval variables include; temperature measured in Celsius or Fahrenheit, time, generation age
range, etc.

1.4. Ratio Variable.

The ratio variable is one of the two types of continuous variables, where the interval variable is the second
one. It is an extension of the interval variable and is also the peak of the measurement variable types. The
only difference between the ratio variable and interval variable is that the ratio variable already has a zero
value. For example, temperature, when measured in Kelvin is an example of ratio variables. The presence of a
zero-point accommodates the measurement in Kelvin. Also, unlike the interval variable multiplication and
division operations can be performed on the values of a ratio variable.

2. Different types of charts/tables and diagrams.

2.1. Pie Charts.
2.1.1. Definitions.

A Pie Chart is a type of graph that displays data in a circular graph. The pieces of the graph are proportional to
the fraction of the whole in each category. In other words, each slice of the pie is relative to the size of that
category in the group as a whole. The entire pie represents 100 percent of a whole, while the pie slices
represent portions of the whole.

2.1.2. Advantages and Disadvantages.

2.1.3. Application.
2.2. Tables.
2.2.1. Definitions.
2.2.2. Advantages and Disadvantages.
2.2.3. Application.
2.3. Histograms.
2.3.1. Definitions.
2.3.2. Advantages and Disadvantages.
2.3.3. Application.
2.4. Frequency Curves.
2.4.1. Definitions.
2.4.2. Advantages and Disadvantages.
2.4.3. Application.
2.5. Normal Curves.
2.5.1. Definitions.
 2.5.2. Advantages and Disadvantages.
2.5.3. Application.
2.6. Scatter Plots.
2.6.1. Definitions.
2.6.2. Advantages and Disadvantages.
2.6.3. Application.
2.7. Frequency Tables.
2.7.1. Definitions.
2.7.2. Advantages and Disadvantages.
2.7.3. Application.
3. M4 Justify the rationale for choosing the method of communication.
4. D3 Critically evaluate the use of different types of charts and tables for communicating given
variables.
IV. CONCLUSION.