Probability is the analysis of random phenomena, mathematical abstractions of nondeterministic events or measured quantities that may either be single occurrences or evolve over time in an apparently random fashion. If an individual tosses a coin or rolls a die many times, the sequence of these random events will exhibit a certain pattern. The business application of probability theory is to combat levels of uncertainty, because it allows for a larger breadth of data, and points to reasonable outcomes that may happen based on that data. As an enterprise becomes larger, the number of variables to consider increases, thus putting more weight behind each decision that impacts the whole.
Probability analysis is a powerful tool in risk management, because it begins to show what might happen as one works through the possibilities when considering change. Probability analysis is useful for any decision making process, and can increase buy-in when used to justify big or small changes. The system can also be used to eliminate wasted time and energy in a system by speeding decision making, and ensuring that all decisions are made on the basis of sound data.
Iknow has deep expertise in managing all aspects of probabilistic analysis and statistics projects from initial requirements gathering, to creating workable hypotheses, to collecting data from departments, to training individuals on systems, to customization and deployment of software. These projects are best integrated with models and simulations, business intelligence, business process management, and risk management. Typical probability analysis projects involve changes to distribution systems, and decisions upon investments in different departments or businesses.