Unit 1
Unit 1
Unit 1
Concept, nature, scope, need and managerial value of Business research; Manager and Research,
Characteristics of Research, Philosophy in research, Types of Research, Ethics in Research.
Concepts, Constructs, Definitions, Variables, Proposition, Theory, Models, Research Questions,
Review of Literature, Research Process.
Information Sources
Apart from business research there can be other sources of information like decision support
system and business intelligence system. When elements of data are organized for retrieval, they
collectively constitute a business decision support system (DSS). This data is often shared over
an intranet or an extranet.
A business intelligence system (BIS) is designed to provide ongoing information about events
and trends in technological, economic, political and legal, demographic, cultural, social, and
competitive areas.
1. Sources of Business Intelligence
• Sources of government information include speeches by elected officials, recordings of
public proceedings, press releases, and agency websites.
• Sources of competitive information include presentations at conferences, literature
searches, press releases, syndicated industry studies, web sites, and business research.
• Sources of economic information include literature searches and government reports.
• Sources of cultural and social information include syndicated studies, public opinion
organizations, business research, and government reports.
• Sources of technological information include patent filings, web sites, syndicated
industry studies, presentations at conferences, and literature searches.
• Sources of demographic information include syndicated studies, government reports, and
business research.
Determining when to Conduct Business Research
■ Time constraints
■ Availability of data
■ Nature of the decision
■ Benefits versus costs
Availability of Benefits
Time Constraints Data Nature of the Decision vs. Costs
Is the infor- Does the value
Is sufficient time Yes Yes Is the decision Yes
mation already of the research Ye
available before of considerable
on hand information
a managerial strategic
inadequate exceed the cost
decision or tactical
for making of conducting
must be made? importance?
the decision? research?
No No No No
Value of research information should exceed estimated costs - Value of research information
lies in the fact that it helps in decreasing uncertainty, increasing likelihood of correct decision,
improving business performance, and generating higher profits. The value of research
information may be judged in terms of “the difference between the result of decisions made with
the information and the result that would be made without it. Cost of conducting research include
research expenditures, delay of business decision and possible erroneous research results.
Basic Research
■ Attempts to expand the limits of knowledge.
■ Not directly involved in the solution to a pragmatic problem.
For Example
■ Is executive success correlated with high need for achievement?
■ Are members of highly cohesive work groups more satisfied than members of less
cohesive work groups?
■ Do consumers experience cognitive dissonance in low-involvement situations?
Applied Research
■ Conducted when a decision must be made about a specific real-life problem.
For Example
■ Should McDonalds add Italian pasta dinners to its menu?
“Our sales are declining and “What kind of people are buying “Will buyers pu
possible situation
we don’t know why.” our product? Who buys our our products in a ne
competitor’s product?”
“Would people be interested “Which of two advertising
in our new product idea?”“What features do buyers prefer campaigns is more e
in our product?”
Exploratory Research
i. Initial research conducted to clarify and define the nature of a problem
ii. Does not provide conclusive evidence.
iii. Subsequent research expected.
Methods used are
i. Secondary data
ii. Experience survey
iii. Pilot studies
Descriptive Research
■ Describes characteristics of a population or phenomenon
■ Some understanding of the nature of the problem
Causal Research
■ Conducted to test cause and effect relationships
Sales and Marketing Research – For example, Market potential analysis; market segmentation
analysis and demand estimation, Market structure analysis which includes market size, players
and market share of the key players.
Product Research: This would include new product research; product testing and development;
product differentiation and positioning; testing and evaluating new products and packaging
research; brand research.
Pricing Research: This includes price determination research; evaluating customer value;
competitor pricing strategies; alternative pricing models and implications.
Promotional Research: This includes everything from designing of the communication mix to
design of advertisements, copy testing, measuring the impact of alternative media vehicles,
impact of competitors’ strategy.
Place Research: This includes locational analysis, design and planning of distribution channels
and measuring the effectiveness of the distribution network.
Production and Operation Management – For example, Process planning which includes
production scheduling and material requirement management; work design planning and
monitoring; production scheduling and material requirement management; work design planning
and monitoring.
Project management and maintenance management studies.
Logistics and supply chain, and inventory management analysis.
Steps in Research Process – The research process goes through the following steps.
Research Proposal
The research proposal as an activity incorporates decisions made during early project planning
phases of the study and the choices the investigator makes in the preliminary steps.
A written proposal is often required when a study is being suggested. This is especially true if an
outside research supplier is contracted to conduct the research. The written proposal ensures that
the parties agree on the project’s purpose, the proposed methods of investigation, the extent of
analysis, and the timing of each phase as well as of delivery of results. Budgets are spelled out,
as are other responsibilities and obligations. The proposal may serve the purpose of a legally
binding contract.
Research Design
The research design is the blueprint for fulfilling objectives and answering questions. Selecting a
design may be complicated by the availability of a large variety of methods, techniques,
procedures, protocols, and sampling plans. It focuses upon the type and purpose of study. It
involves decisions related to the type of data, sources of data and method of data collection.
Further, it may also decide about the choice of sample, size of sample and techniques of
sampling.
.
Collecting the data
Data are the facts presented to the researcher from the study’s environment. The method selected
will largely determine how the data is collected. Questionnaires, standardized tests, observational
forms and laboratory tests are among the devices used to record raw data. Primary data refers to
the firsthand data gathered by the researcher himself. Secondary data means data collected by
someone else earlier.
Data are edited to ensure consistency across respondents and to locate omissions. In the case of
survey methods, editing reduces errors in the recording, improves legibility, and clarifies unclear
and inappropriate responses. Edited data are then put into a form that makes analysis possible.
Managers need information, not raw data. Researchers generate information by analyzing data
after its collection. Data analysis usually involves reducing accumulated data to a manageable
size, developing summaries, looking for patterns, and applying statistical techniques.
Further, researchers must interpret these findings considering the client’s research question or
determine if the results are consistent with their hypotheses and theories.
Finally, it is necessary to prepare a report and transmit the findings and recommendations to the
manager for the intended purpose of decision making. The researcher adjusts the style and
organization of the report according to the target audience, the occasion, and the purpose of the
research. The results of applied research may be communicated via conference call, letter,
written report, oral presentation, or some combination of any or all of these methods. Reports
should be developed from the manager’s or information user’s perspective.
Language of Research
Construct – It is an image or abstract idea specifically invented for a given research and/or
theory-building purpose.
Scientific Method - The use of a set of prescribed procedures for establishing and connecting
theoretical statements about events and for predicting events yet unknown.
The scientific method, as practiced in business research, guides our approach to problem
solving.
The essential tenets of the scientific method are:
• Direct observation of phenomena.
• Clearly defined variables, methods, and procedures.
• Empirically testable hypotheses.
• The ability to rule out rival hypotheses.
• Statistical rather than linguistic justification of conclusions.
• The self-correcting process.
Abstract Level
• Concepts abstract reality.
• Propositions are statements concerned with the relationships among concepts.
Relational Hypotheses
A relational hypothesis is a statement about the relationship between two variables with respect
to some case. Relational hypotheses may be correlational or explanatory (causal).
A correlational hypothesis is a statement indicating that variables occur together in some
specified manner without implying that one causes the other.
A causal hypothesis is a statement that describes a relationship between two variables in which
one variable leads to a specified effect on the other variable.
Correlational Causal
Young women (under 35) An increase in family
purchase fewer units of our leads to an increase i
product than women who are percentage of income
older than 35. Loyalty to a grocery s
increases the probab
The number of suits sold varies purchasing that store
directly with the level of the brand products.
business cycle.
The Role of Hypotheses
Guide
Guide the
the direction
direction of
of the
the study
study
Identify
Identify relevant
relevant facts
facts
Suggest
Suggest most
most appropriate
appropriate researc
resear
design
design
Provide
Provide framework
framework for
for organ
organ
resulting
resulting conclusions
conclusions
Variable - A variable is anything that may assume different numerical values.
• An independent variable is the variable manipulated by the researcher to cause an effect
on the dependent variable.
• The dependent variable is the variable expected to be affected by the manipulation of an
independent variable.
• Moderating variables are variables that are believed to have a significant contributory or
contingent effect on the originally stated IV-DV relationship. Whether a variable is
treated as an independent or as a moderating variable depends on the hypothesis.
• Extraneous variables are variables that could conceivably affect a given relationship.
Some can be treated as independent or moderating variables or assumed or excluded from
the study. If an extraneous variable might confound the study, the extraneous variable
may be introduced as a control variable to help interpret the relationship between
variables.
Deductive Reasoning - The logical process of deriving a conclusion from a known premise or
something known to be true.
– We know that all managers are human beings.
– If we also know that John Smith is a manager,
– then we can deduce that John Smith is a human being.
Inductive Reasoning - The logical process of establishing a general proposition on the basis of
observation of particular facts.
– All managers that have ever been seen are human beings;
– therefore all managers are human beings.
Model - A model is a representation of a system constructed to study some aspect of that system
or the system as a whole.
Models versus Theories
• A model’s role is to represent or describe.
• A theory’s role is to explain.
Ethics in research
Business ethics is the application of morals to behavior related to the business environment or
context. Everyone involved in business research can face an ethical dilemma. We can divide
those involved in research into three parties:
1. The people actually performing the research, who can also be thought of as the “doers”.
2. The research client, sponsor, or the management team requesting the research, who can be
thought of as the “users” of research
3. The research participants, meaning the actual research respondents or subjects
Each party has certain rights and obligations toward the other parties.
Rights and Obligations of the Researcher - Research staff and research support firms should
practice good business ethics.
Research That Isn’t Research - Consumers sometimes agree to participate in an interview that
is purported to be pure research, but it eventually becomes obvious that the interview is really a
sales pitch in disguise.
Misrepresentation of Research - It should go without saying, but research results should not be
misrepresented. This means, for instance, that the statistical accuracy of a test should be stated
precisely and the meaning of findings should not be understated or overstated. Both the
researcher and the client share this obligation.
Confidentiality - Confidentiality comes into play in several ways. The researcher often is
obligated to protect the confidentiality of both the research sponsor and the research participant.
Conflict of interest - Occurs when one researcher works for two competing companies.
An Open Relationship with Research Suppliers - The client sponsor has the obligation to
encourage the research supplier to objectively seek out the truth. To encourage this objectivity, a
full and open statement of the decision situation, a full disclosure of constraints in time and
money, and any other insights that assist the researcher should be provided. This means that the
researcher will be provided adequate access to key decision makers.
The researcher must provide a research design appropriate for the research question; maximize
the sponsor’s value for the resources expended and provide data-handling and data-reporting
techniques appropriate for the data collected.
Review of Literature
A literature review is a description of the literature relevant to a particular field or topic. It gives
an overview of what has been said, who the key writers are, what are the prevailing theories and
hypotheses, what questions are being asked, and what methods and methodologies are
appropriate and useful.
It is a critical analysis of the existing research relevant to your topic, and you should show how
the literature relates to your topic and identify any gaps in the area of research. Following points
need to be considered while conducting review of literature.
1. What subject areas does your topic fall into?
2. What possible sources could you use?
● Company reports
● Industry profiles
● Market research
● Financial reports
● Newspaper articles
● Journal articles
3. What are the limits? For example, geographical restrictions or time periods.
Benefits of Literature Reviews
● Literature reviews allow you to gain familiarity with the current knowledge in your
chosen field, as well as the boundaries and limitations of that field.
● Literature reviews also help you to gain an understanding of the theory(ies) driving the
field, allowing you to place your research question into context.
● Literature reviews provide an opportunity for you to see and even evaluate successful and
unsuccessful assessment and research methods in your field.
● Literature reviews prevent you from duplicating the same information as others writing in
your field, allowing you to find your own, unique approach to your topic.
● Literature reviews give you familiarity with the knowledge in your field, giving you the
chance to analyze the significance of your additional research.
Choosing Your Sources - When selecting your sources to compile your literature review, make
sure you follow these guidelines to ensure you are working with the strongest, most appropriate
sources possible.
Topically Relevant - Find sources within the scope of your topic.
Appropriately Aged - Find sources that are not too old for your assignment.
Credible - Find sources whose authors have authority on your topic.
Appropriately “Published” - Find sources that meet guidelines (academic, professional, print,
etc.)