In this discussion, you will examine practical applications of hypothesis testing. Make sure to read the chapter on hypothesis testing before posting. Without understanding the methodology and how to write the null hypothesis and the alternative hypothesis, you will not be able to complete this Discussion.

Successful management is about making decisions to bring about desired change. A manager who has a specific objective will execute an action, hoping that the result will be the achievement of that objective. However, due to the multitude of factors that are in play in any real-life situation, it is difficult to tell if the desired outcome has been achieved or if the new numbers are only due to randomness.

For example, a sales manager implements a bonus system and sees the sales figures go up by 3% in the next month. She claims success, but was this really due to the bonus system or could the increase be the result of random fluctuations, something that would have happened anyway? Can the manager confidently claim that there has been a significant change, something that could not be the result of random fluctuations?

Another example may be where HR is worried there may be a difference between the salaries of men versus women that may need to be corrected. Is the difference between average salaries of the two genders significant, or could it be due to coincidence? Can someone claim there is discrimination at work?

Hypothesis testing settles such questions by analyzing statistical data and is key to managing intelligently. Without these answers, you cannot be sure if the actions you are taking are working out or whether things really are the way you think they are. If you do not know these, how can you know what to do?

For this discussion, describe a key question or claim that may drive important actions from your work, as in the examples above. Follow the template below and answer all questions (using the template below is part of the requirements- you will lose points if you don’t follow the template and skip portions of what is being asked):

Describe the key question: What is the key question/claim that needs to be settled? What are the actions being considered based on the possible answers? (For example, the question for the sales manager is whether the bonus system is effective, and the actions are whether to continue the bonus system or not. HR’s question is whether there is discrimination and the action will be adjusting salaries or not.) Without hypothesis testing, how is management deciding on the answer to the question?
What is the variable? How would you set up the hypothesis test? First, pick an appropriate variable to measure the element in question (Note that this must be specific and measurable (countable)). Then, state what the null and alternative hypotheses would be and what kind of a test you would use.
Describe the data you would use: What do you need and where would it come from? Does it need to be collected or does it already exist?
How would you explain to management the significance of this test? How would you convince them that using this is necessary? What would be the drawback of not using a hypothesis test in this situation?
What is the key question/claim that needs to be settled?

Over the last decade, demand for peppermint essential oils has soared due to the emerging healing powers. Researchers claim that peppermint is a versatile product that can be used to alleviate anxiety.

What are the actions being considered based on the possible answers?

However, the arising question is whether peppermint essential oils are indeed a remedy for pangs of anxiety and whether medical care professionals should endorse the product for anxiety-related disorders.

Without hypothesis testing, how is management deciding on the answer to the question?

The management team will ourightly assume that peppermint essential oils has a positive and significant effect on pangs of anxiety levels because there will be no opposing statements to test the relationship between two variables.

What is the variable?

Peppermint essential oils users and non-consumers.

How would you set up the hypothesis test?

Hypothesis testing involves five steps to weigh the significance of the suppositions. Firstly there should be a null hypothesis. The null hypothesis is the most accepted fact that addresses a question with no underlying research. It does not show any difference between the two variables. Most of the time, researchers aim is to nullify the null hypothesis. Secondly, there should be an alternative hypothesis to show a statistical difference between the variables. An alternative hypothesis has supporting statistical data that tries to nullify the null hypothesis. Concurrently rejecting the null hypothesis shows the alternative hypothesis (Jeff, 2011, p. 663). The next step involves determining the significance level. The significance level illustrates the probability of rejecting the null hypothesis. It usually ranges between 5% to 1% depending on the area of study. For instance, when the significance level is 5%, it bargains support for the alternative hypothesis, thus rejecting the null hypothesis.

On the other hand, if the significance level is higher than 0.25%, it narrows down the difference between the variables; thus, there is a higher probability that the conclusion will be wrong and inaccurate. In essence, the significance level demonstrates the researchers’ confidence in the null and alternative hypotheses. Subsequently, there is a need to set up a p-value. The p-value is based on actual statistics. It evaluates the probability of approving the null hypothesis. A higher p-value indicates lower support of the alternative hypothesis and vice versa. The final step in the hypothesis test is concluding. The p-value and the significance level are the major determinants of the conclusion. While the p-value is dependent on actual data, the significance level stipulates the terms upon which the null hypothesis will be rejected. Therefore if the p-value is lower than the significance level, the alternative hypothesis becomes valid, thus rejecting and disapproving the null hypothesis.

State what the null and alternative hypotheses would be and what kind of a test you would use.

Null hypothesis- Peppermint essential oil does not relieve anxiety.

The alternative hypothesis- Peppermint essential oil reduces the pangs of anxiety.

Significance level- For this study, the significance level can be set 0.25(improves chances of accepting the alternative hypothesis).

Conclusion- The research will utilize summative tests to determine the levels of anxiety reported amongst peppermint users and nonusers over a given period. If the statistical difference between the two study groups showed that peppermint essential oil indeed has properties that can relieve the pangs of anxiety, then the null hypothesis would become null and void.

Describe the data you would use: What do you need and where would it come from? Does it need to be collected or does it already exist?

This research will be based on real-time self and diagnostic reports of a medical professional on the levels of anxiety between two study groups over a given period. The study groups include peppermint users and non-peppermint consumers. However, the data is currently unavailable; thus, there is a need to conduct new research.

How would you explain to management the significance of this test? How would you convince them that using this is necessary?

In today’s world, there are many factors influencing consumption decisions. At the same time, it a formidable task establishing those factors; therefore, it is increasingly important to find real patterns in the functionality of the product.

What would be the drawback of not using a hypothesis test in this situation?

Failure to conduct a hypothesis test out rightly invalidates the null hypothesis as a question of no interest without data to back it up (Jeff, 2011, p. 665).

Reference List

Jeff, M., 2011. Hypothesis Testing in the Real World. WEducational and Psychological Measurement, p. 672.