Business

Research Methods

The Role of Business Research

Business Research Defined

Business research is defined as the

systematic and objective process of
generating information for aid in
making business decisions.
Business Research

Research information is neither intuitive nor

haphazardly gathered.
Literally, research (re-search) -search again
Business research must be objective
Detached and impersonal rather than biased
It facilitates the managerial decision process for all
aspects of a business.
 I dont know
if we
should
Information offer on-site
child care?
Reduces

Uncertainty
 It aint the things we
dont know that gets us
in trouble. Its the things
we know that aint so.
Artemus Ward
Business Research Types

Basic research

Applied research
Basic Research

Attempts to expand the limits of knowledge.

Not directly involved in the solution to a pragmatic
problem.
Basic Research 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?
"The secret of success is to know something nobody else
knows. "
Aristotle Onassis
Applied Research

Conducted when a decision must be made about a

specific real-life problem
Applied Research Examples

Should McDonalds add Italian pasta dinners to its

menu?
Business research told McDonalds it should not?
Should Procter & Gamble add a high-priced home teeth
bleaching kit to its product line?
Research showed Crest Whitestrips would sell well at a
retail price of $44
Types of research
Exploratory research is loosely structured and the
basic premise is to provide direction to subsequent,
more structured method of enquiry.

Conclusive research is structured and definite in

orientation. These studies are usually conducted to
validate formulated hypotheses and specified
relationships.
Exploratory vs Conclusive
Research
Conclusive research

Descriptive research: The main goal of this type of

research is to describe the data and characteristics
about what is being studied.

Causal research: Explores the effect of one or more

variables on other variable(s), with reasonable level of
certainty by controlling the impact of other influencing
variables.
The research process
The research process

The management decision problem

Defining the research problem

Formulation of the working hypotheses

Construction of the research proposal

The research process

Formulating the research design

Sampling considerations

Collecting the data for the study

Data analysis and interpretation of findings

Determining When to Conduct
Business Research
Time constraints
Availability of data
Nature of the decision
Benefits versus costs
 Determining When to Conduct
Business Research
Availability of Benefits
Time Constraints Data Nature of the Decision vs. Costs
Is the infor- Does the value
Is sufficient time Is the decision Conducting
Yes mation already Yes Yes of the research Yes
available before of considerable
a managerial
on hand
strategic
information Business
inadequate exceed the cost
decision
for making
or tactical
of conducting Research
must be made? importance?
the decision? research?

No No No No

Do Not Conduct Business Research

Value versus Costs

Potential Value of a Business Research Effort Should

Exceed Its Estimated Costs
Value Should Exceed
Estimated Costs
Costs
Value Research
expenditures
Decreased certainty Delay of business
Increased likelihood
decision and
of a correct decision
possible disclosure
Improved business
of information to
performance and
rivals
resulting higher Possible erroneous
profits
research results
Major Topics for Research in
Business
General Business Conditions and
Corporate Research
Financial and Accounting Research
Management and Organizational Behavior
Research
Sales and Marketing Research
Operations Research
Research applications in marketing
Market & consumer analysis

Product research

Pricing research

Promotional research

Place research
Research applications in finance

Asset pricing, capital markets and corporate finance

Financial derivatives and credit risk modeling research

Market-based accounting research

Auditing and accountability

Other areas: financial forecasting, behavioural finance,

volatility analysis
 Research applications in
human resources
Training & development studies

Selection and staffing studies

Performance appraisaldesign and evaluation

Organization planning and development

Incentive and benefits studies

Emerging areascritical factor analysis, employer branding

studies
Research applications in
production & operations
management
Operation planning and design

Demand forecasting and demand estimation

Process planning

Project management and maintenance effectiveness

studies
Logistics and supply chain-design and evaluation

Quality estimations and assurance studies

Business Research in the 21st
Century
Increased globalization
Growth of the Internet and other information
technologies
Global Research

Business Research is increasingly global

Market knowledge is essential
Global Business Research
General information about country - economic
conditions and political climate
Cultural and consumer factors
Market and competitive conditions - demand estimation
The Internet
Is Transforming Society
Time is collapsing.
Distance is no longer an obstacle.
Crossing oceans is only a mouse click away.
People are connected 24 hours a day, seven days a
week.
"Instantaneous" has a new meaning.
Internet Research

Seeking facts and figures about an issue

Surveys on Web sites