Hypothesis testing basics
Hypothesis testing is the statistical framework used in the Analyze phase to decide whether an observed difference or relationship in the data is real or due to chance. Green Belt exams test the structure of hypotheses, what a p-value means, and the two types of errors.
Hypothesis structure
- Null hypothesis (H0): The default position — no effect, no difference, no relationship. Example: “The new setting produces the same mean output as the old setting (μnew = μold).”
- Alternative hypothesis (Ha): What the team is trying to demonstrate. Example: “The new setting produces a different mean output (μnew ≠ μold).”
The test either rejects H0 (evidence is strong enough) or fails to reject H0 (evidence is not strong enough). Failing to reject H0 does not prove H0 is true — it means the data didn’t provide enough evidence to reject it.
The p-value
The p-value is the probability of observing results at least as extreme as those in the data assuming H0 is true. A small p-value means the results are unlikely under H0, providing evidence against it.
p-value < α → Reject H0 (statistically significant)
p-value ≥ α → Fail to reject H0 (not statistically significant at this α level)
Common trap: “p = 0.03 means there is a 3% chance the null hypothesis is true.” This is wrong. p = 0.03 means there is a 3% chance of observing results this extreme if H0 were true.
Type I and Type II errors
| H0 is actually true | H0 is actually false | |
|---|---|---|
| Reject H0 | Type I error (α) — false positive; "false alarm" | Correct decision ✓ |
| Fail to reject H0 | Correct decision ✓ | Type II error (β) — false negative; "miss" |
- α (Type I error rate): Usually set to 0.05. Lower α = fewer false alarms, but harder to detect real effects.
- β (Type II error rate): Related to power (Power = 1 − β). Higher power = better at detecting real effects. For a given α, a larger sample size increases power (lowers β).
Basic test selection
| What are you comparing? | Data | Test |
|---|---|---|
| One mean vs. a target | Continuous | 1-sample t-test |
| Two independent group means | Continuous | 2-sample t-test |
| Before/after on the same units | Continuous | Paired t-test |
| Three or more group means | Continuous | One-way ANOVA |
| Two proportions | Attribute | 2-proportion z-test |
| Two categorical variables | Attribute | Chi-square test |
The free 20-question CSSGB diagnostic covers all six Body of Knowledge sections, with an explanation for every answer.
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