Many variables or metrics in your organization can be referred to as dependent variables. Metrics such as profit, turnaround time or late deliveries are a function of, or dependent upon, specific independent variables which may cause the values of your dependent variable to change.
Overview: What is a dependent variable?
As the name implies, a dependent variable is a variable that depends on something. That something is called an independent variable. For example, your organization’s profit is dependent on your cost of labor and materials. It is also dependent on sales revenue.
We can call these other variables independent variables because their values are independent of each other. But in the end, your profit is dependent upon the values of those independent variables and their relationship with your dependent variable.
Sometimes, the dependent variable is referred to as the effect, and the independent variable is called the cause. In regression analysis, the dependent variable is called the predictor variable and the independent variable is called the response variable.
You can distinguish between independent and dependent variables by asking a simple question. As an example, assume you have two variables: profit and labor cost. You are interested in which is the independent variable and which is the dependent variable. Ask this question:
Is profit dependent upon labor cost or is labor cost dependent upon profit?
It becomes obvious that your labor cost might cause your profit to go up or down while profit does not cause your labor cost to vary. This would make labor cost the independent variable and profit your dependent variable.
An industry example of a dependent variable
A company was experiencing an increase in late deliveries. The company Master Black Belt (MBB) identified this as an effect or dependent variable. The MBB sought to identify the causes or independent variables so she could reduce the late deliveries. She identified the root causes using a Fishbone diagram and by eliminating some of the root causes she was able to reduce the number of late deliveries.
Frequently Asked Questions (FAQ) about a dependent variable
Can a dependent variable be represented by the letter Y?
Yes. A simple formula used to represent the relationship between dependent and independent variables is Y = f(X) which in words says, Y is a function of X. You can also say that the value of your dependent variable is a function of the value of your independent variable.
What statistical technique uses the concept of dependent and independent variables?
Regression analysis is concerned with using independent variables to make a prediction about a dependent variable.
What is the difference between an independent and dependent variable?
The independent variable can be referred to as the cause. Its value is independent of the other variables you are studying. The dependent variable can be referred to as the effect. Its value depends on the values of the independent variables.