Human Capital Analytics: How to Harness the Potential of Your Organization's Greatest Asset

Appendix C

Details of Basic Descriptive Statistics

Now that you have your data, the first step is to really understand what the data are telling you. Certain important statistical measures can give you a good picture of your underlying data.

Descriptive Statistics

• Mean, also called the average, is the sum of values divided through by the number of items.
• Median, when values are arranged from highest to lowest, is the one in the middle, or at the fiftieth percentile. Medians, although less familiar of a concept than the mean, are usually more useful, especially if you are trying to get some sense of what is “typical.” For example, consider income. If a country has a very small number of super-wealthy individuals, the median value of income may give you a sense of what the typical person is like. If you have 100 people on an island, and they have a “typical” income, the median income might be $50,000. If Bill Gates were to come ashore on that island, the average income would jump to half a billion dollars, though the median would hardly change at all.
• Mode is the most commonly scored value in a set. This one is sometimes useful to represent a typical value.
• Maximum is the highest value that occurs in a set.
• Minimum is the lowest value that occurs in a set.

The idea of variation is also important. In sports, there is the player who is viewed as extremely solid and reliable and usually scores somewhere close to his average. Contrast that with the player who explodes on occasion and ...