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Concept of Hypothesis Testing
Hypothesis testing is one of the primary analytical techniques used at various stages of the Lean Six Sigma process. This lesson introduces the basic concepts of hypothesis testing and relates it to the more general scientific method of inquiry.
When to use
The concepts of hypothesis testing are used whenever hypothesis testing is used. Lean Six Sigma projects use hypothesis testing in the Analyze phase to identify and prioritize potential root causes of the problem. It is also used in the Improve phase to demonstrate the effectiveness of proposed solution.
Hypothesis testing has it roots in the scientific method. This is an approach for organized inquiry. A question is posed, based upon the question, a hypothesis is created. To prove or disprove the hypothesis, an experiment is developed. The experimental method is proved valid or it is changed. When the experimental method is ready, data is collected and then analyzed. If the data is inconclusive, often the hypothesis must be revised and the process repeated. But when the data is conclusive, the conclusion will be to reject or accept the hypothesis as an answer to the question.
Hypothesis testing is an integral part of the scientific method. It has also become associated with the Lean Six Sigma methodology as a means to demonstrate with data and statistical confidence the existence of root causes for the problem being investigated. It is also used to demonstrate with data and statistical confidence that a proposed improvement is effective. The hypothesis is a set of statements that essentially answer the question, “Is there a real difference between this data set and that data set?” If the difference is real, then we have isolated a possible root cause or demonstrated that the improvement makes a difference. Hypothesis testing allows us to use data to demonstrate with statistical confidence something that we think we already know. We don’t need to rely upon lucky guesses or intuition, we can use data when forming our conclusions.
Within Lean Six Sigma, hypothesis testing is used in the Analyze phase to isolate root causes for the problem being investigated. Many times the hypothesis test will use the data gathered in the Measure phase. The hypothesis consists of two opposing statements called the Null hypothesis and the Alternative hypothesis. Through the analysis, the statistics developed directs you to either reject the Null hypothesis or fail to reject the Null hypothesis. If the hypothesis is supporting a Lean Six Sigma project during the Analyze phase, the Null hypothesis might state that there is no difference in the quality of products built on production line A as compared to production line B. The Alternative hypothesis would state that there is a difference in the quality of products built on production line A as compared to production line B. Using data from each line, the hypothesis test would determine which statement is most likely to be true.
During the Improve phase of the Lean Six Sigma project, a similar approach is used, only now it is to demonstrate that the solution is effective. The Null hypothesis would state that the solution makes no difference in the quality of the products produced. And the Alternative hypothesis would state that the solution has improved the quality of the products being produced.
Hints & tips
The hypothesis test will tell us if the changes we see in two data or more data sets is statistically significant. While it may be obvious that one data set has a higher or lower value than the others, that may just be to random chance. The hypothesis test tells us if the difference is statistically significant.
Clarify the question you want to answer. This will make writing the hypotheses statements easier.
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