RESEARCH

METHODOLOGY
(Business Research Methods)

Course Instructor: Dr. Aurangzeb Z. Khan 1

 Measurement and Scaling (1)
 In business research, measurement of variables is a
indispensable requirement

 Problem – Defining what is to be measured, and how it is

to be accurately and reliably measured

 Some things (or concepts) which are inherently abstract

in their nature (e.g. job satisfaction, employee morale,
brand loyalty of consumers) are more difficult to measure
than concepts which can be assigned numerical values
(e.g. sales volume for employees X, Y and Z)

Course Instructor: Dr. Aurangzeb Z. Khan 2

 Measurement and Scaling (2)
 In order for a concept to have the quality of being
measurable, it must first be made operational

 An operation definition may be defined as a definition

that gives meaning to concept by specifying the activities
or operations which are necessary in order to measure it

 Example – A satisfied consumer will make at least five

purchases of Product A from Shop T over a three-month
period of time

 Note that sometimes – depending on the context of the

research study - it may be difficult to make operational
definitions
Course Instructor: Dr. Aurangzeb Z. Khan 3
 Measurement and Scaling (3)
 A scale is basically a continuous spectrum or series of
categories and has been defined as any series of items
that are arranged progressively according to value or
magnitude, into which an item can be placed according
to its quantification

 Four popular scales in business research are:

– Nominal scales
– Ordinal scales
– Interval scales
– Ratio scales
Course Instructor: Dr. Aurangzeb Z. Khan 4
 Measurement and Scaling (4)
 A nominal scale is the simplest of the four scale types
and in which the numbers or letters assigned to objects
serve as labels for identification or classification

 Example:

 Males = 1, Females = 2
 Sales Zone A = Islamabad, Sales Zone B = Rawalpindi
 Drink A = Pepsi Cola, Drink B = 7-Up, Drink C = Miranda

Course Instructor: Dr. Aurangzeb Z. Khan 5

 Measurement and Scaling (5)
 An ordinal scale is one that arranges objects or
alternatives according to their magnitude

 Examples:

 Career Opportunities = Moderate, Good, Excellent

 Investment Climate = Bad, inadequate, fair, good, very good
 Merit = A grade, B grade, C grade, D grade

A problem with ordinal scales is that the difference between

categories on the scale is hard to quantify, I,e., excellent is
better than good but how much is excellent better?

Course Instructor: Dr. Aurangzeb Z. Khan 6

 Measurement and Scaling (6)
 An interval scale is a scale that not only arranges objects
or alternatives according to their respective magnitudes,
but also distinguishes this ordered arrangement in units
of equal intervals (i.e. interval scales indicate order (as in
ordinal scales) and also the distance in the order)

 Examples:
 Consumer Price Index
 Temperature Scale in Fahrenheit

Interval scales allow comparisons of the differences of

magnitude (e.g. of attitudes) but do not allow determinations of
the actual strength of the magnitude
Course Instructor: Dr. Aurangzeb Z. Khan 7
 Measurement and Scaling (7)
 A ratio scale is a scale that possesses absolute rather
than relative qualities and has an absolute zero.

 Examples:
 Money
 Weight
 Distance
 Temperature on the Kelvin Scale

Interval scales allow comparisons of the differences of

magnitude (e.g. of attitudes) as well as determinations of the
actual strength of the magnitude

Course Instructor: Dr. Aurangzeb Z. Khan 8

 Measurement and Scaling (8)
Type of Scale Numerical Operation Descriptive Statistics

Nominal Counting Frequency in each

category, percentage in
each category, mode
Ordinal Rank Ordering Median, range,
percentile ranking

Interval Arithmetic Operations on Mean, standard

Intervals between deviation, variance
numbers
Ratio Arithmetic Operations on Geometric mean,
actual quantities coefficient of variation

Course Instructor: Dr. Aurangzeb Z. Khan 9

 Index Measures
 If a concept is simple, it can be measured easily usually
with one question or observation

 Example: To what extent do consumers of Product X like the

product’s packaging material? (very much, somewhat, not at all)

 If, however, the concept to be measured is complex and

abstract, two or more questions or observations may be
required in order to get accurate data

 Example: The level of a salesperson’s motivation depends on (1)

job satisfaction (2) workplace environment (3) family life

Indexes (or composite measures) are meant to deal with the issue
of multidimensionalty (e.g. an index of social class may be the
variables residence, occupation and education)
Course Instructor: Dr. Aurangzeb Z. Khan 10
 Criteria for Good Measurement (1)
 Reliability – Reliability is the degree to which
measurements are devoid of error and therefore in the
position to yield consistent results, also over repeated
attempts over time (ordinal measures always yield the
same order, interval measurements always yield the
same order and same distance between the measured
items)

 Validity – Validity is the ability of a scale or measuring

instrument to measure what it is intended to measure
(e.g. is absenteeism from work a valid measure of job
satisfaction or are there other influences like a flu
epidemic which is keeping employees from work)

Course Instructor: Dr. Aurangzeb Z. Khan 11

 Criteria for Good Measurement (2)
 Sensitivity – Sensitivity is the ability of a measurement
instrument to accurately measure variability in stimuli or
responses (e.g. on a scale, the choices very strongly
agree, strongly agree, agree, don’t agree offer more
choices than a scale with just two choices - agree and
don’t agree – and is thus more sensitive)

Course Instructor: Dr. Aurangzeb Z. Khan 12

 Attitude
 Measuring Attitude is a frequent undertaking in business
research

 Attitude may be defined as an enduring disposition to

consistently respond in a given manner to various
aspects

 Attitude has three dimensions:

Affective Cognitive Behavioural

Component Component Component

Course Instructor: Dr. Aurangzeb Z. Khan 13

 Components of Attitude
 Affective Component – Reflective of a person’s
general feelings or emotions towards an object
or subject (like, dislike, love, hate)

 Cognitive Component – Reflective of a person’s

awareness of and knowledge about an object or
subject (know, believe)

 Behavioural Component – Reflective of a

person’s intentions and behavioural
expectations, and predisposition to action

Course Instructor: Dr. Aurangzeb Z. Khan 14

 Measuring Attitude
• It can be difficult to measure attitude, therefore,
indicators such as verbal expression,
physiological measurement techniques and
overt behaviour are used for this purpose. The
three different components of attitude may
require different measuring techniques

• Common techniques used in business research

to determine attitude include rating, ranking,
sorting and the choice technique

Course Instructor: Dr. Aurangzeb Z. Khan 15

 Rating Techniques to Measure
Attitude
 Rating Scales are frequently employed in business research for
measuring attitude, and many scales have been developed for this
purpose, including:

 Simple Attitude Scales

 Category Scales
 Likert Scale
 Semantic Differential
 Numerical Scales
 Constant-Sum Scale
 Stapel Scale
 Graphic Scales

Course Instructor: Dr. Aurangzeb Z. Khan 16

 Simple Attitude Scales
 In attitude scaling, individuals are typically asked
whether they agree or disagree with a question (or
questions) put to them, or they are asked to respond to a
question or questions

 Simple attitude scales have the properties of a nominal

scale and the disadvantages that go with it, also, they do
not permit fine distinctions in the respondents’ answers
because their choice of answers is limited, but they can
be useful in instances where the respondents’ education
level is low and questionnaires lengthy

Course Instructor: Dr. Aurangzeb Z. Khan 17

 Category Scales
 A category scale consists of several
response categories to provide the
respondent with alternative ratings

 Category scales are more sensitive than

rating scales which allow only two answer
categories (because of the larger number
of choices), and thus provides more data
and information (see text example)

Course Instructor: Dr. Aurangzeb Z. Khan 18

 The Likert Scale
 A likert Scale is a measure of attitudes designed to allow
respondents to indicate how strongly they agree or
disagree with carefully constructed statements that
range from very positive to very negative towards an
object or subject

 The number of alternatives on the Likert scale can vary,

often five alternatives are foreseen (see text book
examples)

 A Likert Scale may include a number of question items,

each covering some aspect of the respondent’s attitude,
and these items collectively form an an index
Course Instructor: Dr. Aurangzeb Z. Khan 19
 The Semantic Differential
 The semantic differential is an attitude
measuring technique that which consists of a
series of seven bi-polar rating scales which allow
response to a concept (e.g. organization,
product, service, job)

 See text book example

 An advantage of the semantic differential is its

versatility, on the other hand, it uses extremes
which may influence respondents’ answers

Course Instructor: Dr. Aurangzeb Z. Khan 20

 Other Scales
 Numerical Scales
 Constant-Sum Scals
 Stapel Scales
 Graphic Rating Scales

For practical examples, see text book

Course Instructor: Dr. Aurangzeb Z. Khan 21
 Measuring Behavioral Intentions
 Behavioural intentions relate to „will“, „shall“ or „may“
questions:

 Examples:
– I will purchase Product X
– I shall change my job from 1st January 2006
– I may participate in Training Workshop Z

The Behavioural Differential: This is an instrument for

measuring the behavioural intentions of subjects towards an
object or category of objects. Example:

A Housewife
Would ___ : ___ : ___ : ___ : ___ : ___ : ___ Would Not
Purchase this laundry detergent
Course Instructor: Dr. Aurangzeb Z. Khan 22