Conformance To Requirements Of The Customer Quotes

regression line will have larger standard deviations and, hence, larger standard errors. The computer calculates the slope, intercept, standard error of the slope, and the level at which the slope is statistically significant. Key Point The significance of the slope tests the relationship. Consider the following example. A management analyst with the Department of Defense wishes to evaluate the impact of teamwork on the productivity of naval shipyard repair facilities. Although all shipyards are required to use teamwork management strategies, these strategies are assumed to vary in practice. Coincidentally, a recently implemented employee survey asked about the perceived use and effectiveness of teamwork. These items have been aggregated into a single index variable that measures teamwork. Employees were also asked questions about perceived performance, as measured by productivity, customer orientation, planning and scheduling, and employee motivation. These items were combined into an index measure of work productivity. Both index measures are continuous variables. The analyst wants to know whether a relationship exists between perceived productivity and teamwork. Table 14.1 shows the computer output obtained from a simple regression. The slope, b, is 0.223; the slope coefficient of teamwork is positive; and the slope is significant at the 1 percent level. Thus, perceptions of teamwork are positively associated with productivity. The t-test statistic, 5.053, is calculated as 0.223/0.044 (rounding errors explain the difference from the printed value of t). Other statistics shown in Table 14.1 are discussed below. The appropriate notation for this relationship is shown below. Either the t-test statistic or the standard error should be shown in parentheses, directly below the regression coefficient; analysts should state which statistic is shown. Here, we show the t-test statistic:3 The level of significance of the regression coefficient is indicated with asterisks, which conforms to the p-value legend that should also be shown. Typically, two asterisks are used to indicate a 1 percent level of significance, one asterisk for a 5 percent level of significance, and no asterisk for coefficients that are insignificant.4 Table 14.1 Simple Regression Output Note: SEE = standard error of the estimate; SE = standard error; Sig. = significance.

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