Finding a number for a problem can make it much easier to solve
There is so much data to take into account when trying to run a business, no matter how small, that it is immensely helpful to familiarize yourself with ways to quantify this data to make it understandable. There are a variety of tried and tested quantitative techniques that any business person should know about. Using these methods you will gain a clearer picture of the actual situation of your business and its likely prospects.
Risk Management
Risk is a significant factor in any business venture. The greater the risks your business takes on, the greater the potential rewards it can gain. Skillful management of risk is one of the major factors in the success of any business. Risk management entails the actual quantification of risk. Giving risk a number makes it more tangible and allows business managers to better evaluate the likely impact of their decision-making both short term and long term.
Computer Modeling
Computers have come to take a much greater role in the decision-making of all businesses as their power and tools have come to be more appreciated. Using complex computer modeling software, businesses can try to predict the likely course of different markets and the chances that their ventures have for success. Inputting a greater number of variables than could be processed by a normal person, computer models are growing increasingly refined and more valuable.
Descriptive Statistics
The use of statistics has proven to be of great value to businesses seeking a better description of the reality of their ventures. For example, a company might wish to gain a better idea about the habits and inclinations of its customers. To do this for each individual customer would be almost impossible. Instead, through the use of statistics, a company can gain an idea of the general habits of its entire customer base.
Costs
In the quest for greater efficiency a businesses can use quantitative techniques to cut back on waste and find better ways to accomplish its tasks. For example, a business might be able to quantify the amount of time that is wasted doing a task one way as opposed to another. Businesses today are often finding new areas where exact measurement and quantification can help decide which way of doing things yields better and quicker results.
Tags: have come, their ventures, your business