Fourth Quadrant Statistics

[TomBeraha]

Hello to all,

I recently read an article (link at end of post) that I really enjoyed and got me thinking, and was very interested in hearing what other people thought of his ideas. I've heard some people find the author a bit self-referential and pretentious, which didn't really come across to me directly from this piece. I mention it to give you fair warning in the event it bothers you. I think his ideas sound logical, and given our current financial situation in the united states they probably need to be spread around and at least thought about, if not followed.

I am also wondering if the over-optimization of systems is negatively affecting things like my work, or small business, the local economy as well as the global one. As one example, working in food service, I know how small profit margins actually are for owning a restaurant. In efforts to maximize that profit, very frequently we keep labor as low as possible, meaning getting the most income we can with the least amount of labor spent doing it. This seems logical at first glance, but in light of this article makes me wonder.

Are we hurting our business overall, and bringing in less money to the store because we've "optimized" our labor to be so tight to the "projected" fourth-quadrant sales that when the natural ups and downs come week to week, and we are constantly running slightly under or over hour to hour, that we disappoint our customers in the under hours?

At any rate - the link follows, fair warning it's a bit long. But its a good read.
Edge: The Fourth Quadrant: A Map of the Limit of Statistics

 

[Labyrinth]

Driving things according to the sole 'Profit' bottom line is, in my view anyway, quite a silly thing to do especially in big business. It refuses to take human needs into the equation, especially the needs of an over driven work force. Smaller business with less buffer room don't have the advantage of shifting that burden however, something that needs to be acknowledged.

In fact our entire society is driven by this 'profit', a weird, slimey creature. It seems to have a direct interest in itself alone, and those it is monetarily bound to benefit.

Another interesting thing to come out of that article is this quote: "...and those in other fields who pick up statistical tools from textbooks without really understanding them."

Many fields of work require the use of statistics, and I think it is a real failing of those areas that they are based around a bare bones knowledge of statistics as a tool. Computer programs enable vast amounts of data to be worked into statistics, without the user really understanding what they are reading at the end. The mathematics behind the finished numbers are just as important as the numbers themselves, as they are like the dictionary for the language itself.

 

[Brett Alex]

Thats quite an interesting article. I'll admit I have no background or real knowledge about any of this stuff, but they were some pretty big claims he seemed to be making.

I might have a more informed opinion when I have time to read the second half of it, bit busy at the moment.

Are we hurting our business overall, and bringing in less money to the store because we've "optimized" our labor to be so tight to the "projected" fourth-quadrant sales that when the natural ups and downs come week to week, and we are constantly running slightly under or over hour to hour, that we disappoint our customers in the under hours?

In relation to that though, its not just small restaurants. I used to work as an usher in a cinema complex. Saturdays were always "The Big Nights", you could never put them down as permanently unavailable for example. Because of this, Saturdays nights had more staff on floor than other nights.

However, on rare occasions, bookings would be low and business minimal on Saturdays. If this was still the case by 5 or 6 o'clock, the manager would often send 2 or 3 staff home, hoping to make up for lost revenue.

On even rarer occasions, business would pick up crazily, meaning that the 2 remaining ushers would get hammered by the crowds. Cinemas wouldn't get cleaned (meaning LOTS of popcorn on seats), hourly bathroom checks would be missed and you could forget mopping the back-rooms before close.

 

[Labyrinth]

In relation to that though, its not just small restaurants. I used to work as an usher in a cinema complex. Saturdays were always "The Big Nights", you could never put them down as permanently unavailable for example. Because of this, Saturdays nights had more staff on floor than other nights.

However, on rare occasions, bookings would be low and business minimal on Saturdays. If this was still the case by 5 or 6 o'clock, the manager would often send 2 or 3 staff home, hoping to make up for lost revenue.

On even rarer occasions, business would pick up crazily, meaning that the 2 remaining ushers would get hammered by the crowds. Cinemas wouldn't get cleaned (meaning LOTS of popcorn on seats), hourly bathroom checks would be missed and you could forget mopping the back-rooms before close.

I can see how that applies to a lot of businesses actually. Just as the managers try to keep the profit margin up. Take Woolworths for example. My brother currently works at one store close to us, and he hates it because they are over worked, underpaid and under cared for in the name of cost cutting.

You'd think that a conscientious manager would do all he or she could when it apparently costs a thousand bucks a hit to train new employees, and the ones that are there are so loathe to do anything due to the conditions.