For example, a person managing a group of professionals comes off a highly productive year. You make the claim to the division manager that your group deserves larger pay adjustments this year due to " extraordinary measures of performance " relative to other groups in the firm. The division manager is skeptical; however, she indicates that the group's performance scores were only 11 points higher than the firm average.

You there review the performance relative to the firm as a whole. Determine the probability that the performance level of the group exceeds the firm performance. How likely is the difference a consequence of random chance versus a group exceeding firm performance? How likely is the difference a consequence of random chance versus a real difference? Assuming an alpha of 5% can you justify a more significant pay adjustment for your team?