A Career in Statistics: Beyond the Numbers

CHAPTER 2

WHAT STATISTICIANS DO IN BUSINESS AND INDUSTRY

2.1 ABOUT THIS CHAPTER

Bear in mind that not only is the corporate world different from the academic one, but it itself also varies according to the type of company: from products to services, aerospace to commerce, manufacturing to marketing, research-oriented to results-oriented, and so on.

—Arnold Goodman

Our earlier book (Hahn and Doganaksoy, 2008) describes the role of statistics in business and industry in detail. Also see the series of articles in Coleman et al. (2010).

We, therefore, provide only a brief overview in this chapter of

• Manufactured product applications.
• Service business applications.
• Process improvement.
• Further applications.

2.2 MANUFACTURED PRODUCT APPLICATIONS

Failure to understand variation is the top problem in U.S. industry today.

—Lloyd Nelson

2.2.1 Evolution

Statistics first gained popularity in business and industry in the early twentieth century in what was then referred to as statistical quality control. This principally dealt with ensuring the stability of manufacturing processes (using control charts, building on the pioneering work of Walter Shewhart) and with sampling incoming materials and outgoing product to identify and act upon defective batches (acceptance sampling). Defense industry applications during World War II subsequently led to the formation of central statistical groups in business and industry. Much of the early work of these groups tended to be reactive or “firefighting,” ...