Carragee Consulting

Percentile ranking data is one of the fastest ways to order it for superficial analysis and can be used to build sub-categories such as quartiles or deciles for deeper insights.

My daughter and my niece are in opposite tails of the percentile distribution for size and weight of children at their respective ages – but both are healthy.

Doctors use growth curves (https://lnkd.in/gKEGDWUr) as one means of monitoring and assessing healthy vs. unhealthy growth patterns.

Averaging the cousins size percentiles you get the 50th percentile. Individually they are both in the long tails, statistically speaking they are outliers at either end in the distribution.

In pricing, when trying to set target price based on invoice price data its reasonable to stack rank achieved prices from sales history and attempt to move the average up higher over time by pricing at or above the 50th percentile price.

Just like with the kids though, you want to gather up a lot of other relevant context to ensure you’re interpreting the summary statistics in a meaningful way.

Is a below average margin transaction “normal” or justifiable because of deal size, or total customer relationship value? Is that baby little because they were premature or because their parents are very small or is there a problem with digestion causing persistently below average growth?

In a B2B sales quoting framework percentile ranking is one of the easiest ways to direct a pre-determined portion of the deals for manual review based on workflow rules because by definition routing anything at or below the bottom 10th percentile of prices will be just 10% of transactions.

If you know your total transaction volume and the time manual reviews take, you can calibrate what percentile makes sense for approvers sense to review.

Step 1: Use percentiles to limit manual review to a reasonable workload

Step 2: Once you’ve flagged some subset of your data to review, make sure you bring in the additional information approvers need to evaluate if a quoted price is acceptable or not within the sales context.