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Theory, Proposition &

Hypothesis

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Theory
A theory is a conceptual framework that
explains existing observations and predicts
new ones.
A coherent set of general propositions used to
explain the apparent relationships among
certain observed phenomena.
A hypothesis is a working assumption

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Hypothesis and Theory
Hypothesis becomes a theory when there is
consistency with observations/predictions.
A theory is then a framework within which
observations are explained and predictions are
made.
Prediction and understanding are the two purposes
of theory.

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Concept
A generalized idea about a class of objects; an
abstraction of reality. Example
Leadership, productivity in organizational theory;
Asset, inflation in the theory of finance.
Concept is the basic unit for the development
of theory.

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Concept
Concepts are at two levels:
Abstract exists only as an idea or a quality apart
from an object.
Empirical level- verifiable by experience or
observation

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Proposition
Theories require that the relationship among
concepts be understood.
Propositions are statements concerned with
the relationship among various concepts.
A proposition states that every event of a
certain sort either has a certain property or
stands in a certain relationship to other events
that have certain properties.

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Hypothesis
A hypothesis is a proposition that is
empirically testable.
It tentatively explains certain facts or
phenomena.

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Theory Building:- Increasing Abstraction

Levels of Abstraction Theories

Propositions

Concepts

Observations of Objects and Events


(Reality)

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Hypotheses and Propositions

Hypotheses are the Empirical Counterparts of Propositions.

Abstract Proposition: Reinforcements will increase habit


strength
Hypothesis: Bonus pay will be associated with sales volume
consistently above target.

(See next slide)

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Hypotheses and Propositions
Proposition

Abstract
Concept B
Level Concept A
(Habits)
(Reinforcements)

Empirical Hypothesis
Level
Always makes
Bonus for sales four sales calls a
above quota day

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Facts and Theories
It must be possible to demonstrate that a
proposition or theory is false.
Business research gathers facts to verify
theory.
Facts and theories are different things:
Facts are the worlds data
Theories are structures of ideas that explain and
interpret facts.

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How Theories are Generated
Theory construction is often the result of a
combination of deductive and inductive reasoning.
Deductive Reasoning:
The logical process of deriving a conclusion from a known
premise or something known to be true.
Inductive Reasoning:
The logical process of establishing a general proposition on
the basis of observation of particular facts.

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Research Objectives
& Types of Research

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Objectives of Research
To gain further insight into the problem Exploratory
or Formulative Research
To describe the characteristics of a situation or a
group Descriptive Research
To determine the frequency with which some
variable occurs Diagnostic Research
To test a hypothesis of causal relationship between
variables Hypothesis testing research

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Characteristics of a Good Research
Methodology
Systematic: Structured with specified steps to be
taken in predetermined sequence according to a
specific set of rules
Logical: Should be guided by rules of logical
reasoning
Empirical: Related to one or more aspects of real
situation
Replicable: Results can be verified by replicating the
study

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What is Research Design?
A plan for selecting the sources and types of
information used to answer research
questions
A framework for specifying the relationships
among the study variables
A blueprint that outlines each procedure from
the hypothesis to the analysis

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Descriptors of Research Design
1. Degree of crystallization of research question
2. Method of Data Collection
3. Power to produce effects
4. Purpose of the study
5. Time dimension
6. Topical scope breadth & depth
7. Research environment
8. Participants perceptions

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1. Degree of crystallization of Research question

Exploratory study is usually to develop


hypotheses or questions for further research

Formal study is to test the hypotheses or


answer the research questions posed

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2. Methods of Data Collection
Monitoring, which includes observational
studies

Interrogation/communication studies

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3. Power to Produce Effects
In an experiment, the researcher attempts to
control and/or manipulate the variables in the
study

In an ex post facto design, the researcher has


no control over the variables; they can only
report what has happened

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4. Purpose of the Study
Exploratory Studies Tries to define the
problem more objectively

Descriptive study tries to explain relationships


among variables

Causal study is how one variable produces


changes in another
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5. The Time Dimension
Cross-sectional studies are carried out once
and represent a snapshot of one point in time

Longitudinal studies are repeated over an


extended period

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6. The Topical Scope
Statistical studies attempt to capture a
populations characteristics by making
inferences from a samples characteristics

Case studies place more emphasis on a full


contextual analysis of fewer events or
conditions and their interrelations

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7. The Research Environment
Field conditions: Actual environmental conditions

Laboratory conditions: Manipulated conditions

Simulations: Major characteristics of various


conditions and relationships in actual situations are
often represented in mathematical models: Role
plays, Mystery shoppers

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8. A Participants Perceptions
Usefulness of a design may be reduced when people
in a disguised study perceive that research is being
conducted

Participants perceptions influence the outcomes of


the research: Example if the sales girl comes to know
that her performance is being watched by mystery
shoppers, the performance itself may change

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Why do Exploratory Studies?
Exploration is particularly useful when
researchers lack a clear idea of the problems
Outcome of an Exploratory study is a set of
Hypotheses

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Data Collection Techniques
Two types: Qualitative & Quantitative
Qualitative techniques: Suitable for exploratory
studies
Secondary data
Experience surveys
In-depth interviews
Focus groups
Two-stage design

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Data Collection Techniques
Quantitative techniques: Suitable for descriptive and
causal studies
Only two types: Ask or Observe
Observation
Survey
Experimentation

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Causation
The essential element of causation is
A produces B
or
A forces B to occur

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Causal Study Relationships
Possible relationship between two variables

Symmetrical
Variables fluctuate together but the changes in neither variable
are due to the changes in the other

Reciprocal
Variables mutually influence or reinforce each other

Asymmetrical
Changes in one variable (independent) are responsible for the
changes in the other (Dependent)

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Asymmetrical Relationships
Four types of Asymmetrical Causal Relationship

Stimulus-Response
A change in work rules leads to higher worker output

Property-Disposition
Age and attitudes about saving, Social class and opinion about taxation

Disposition-Behavior
Job satisfaction & work output

Property-Behavior
Age and participation in sports

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The Research Process
Recapitulation

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Research Process
Seven inter-related steps
1. Specifying research objectives
2. Preparing a list of needed information
3. Designing the data collection project
4. Selecting a sample type
5. Determining sample size
6. Organizing & carrying out the field work
7. Analyzing the collected data & report the
findings

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Research Process & Problems in Achieving
Scientific Method
To achieve Validity & Reliability, Marketing
Research should be conducted as a proper
Scientific Method
At each of the seven steps let us analyze
A. Problems in achieving Scientific Method
B. Steps to minimize the potential sources of errors

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Research Process & Problems in Achieving
Scientific Method
To achieve Validity & Reliability, Marketing
Research should be conducted as a proper
Scientific Method
At each of the seven steps let us analyze
A. Problems in achieving Scientific Method
B. Steps to minimize the potential sources of errors

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1. Specifying Research Objectives
A. Problems in achieving Scientific Method
a. Managers Expectations of research results
B. Minimizing potential sources of errors
a. Write research objectives
b. Manager & researcher must discuss the
objective statements & if necessary modify

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2. Preparing a list of needed information

Problems in achieving Scientific Method


a. Due to busy schedule manager may not get adequately
involved
b. May think researcher knows what to do
Minimizing potential sources of errors
a. Manager & researcher should develop List of needed
information together & evaluate usefulness
Research is not needed if manager is forced to select a
particular course of action irrespective of research findings

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3. Designing data collection project
Problems in achieving Scientific Method
a. Using inappropriate research design
b. Wrong selection of respondents
c. Asking unclear or ambiguous questions
d. Using large scale study instead of small scale &
vice versa
e. Using poor experimental design

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3. Designing data collection project
Minimizing potential sources of errors
Five important issues that must be addressed:
Should the research be exploratory or
conclusive?
Who should be interviewed & how?
Should only few cases be studied or large
samples?
How well experiments be incorporated?
How should data collection form be designed?

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4. Selecting a sample type
Why samples? Probability Vs. Non Probability
Problems in achieving Scientific Method
a. Sample not representative of the population
Minimizing potential sources of errors
a. Define sampling frame carefully
b. Select proper sampling method Simple
Random

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5. Determining Sample size
Problems in achieving Scientific Method
a. Sample size depends upon
i. Nature of the problem
ii. Budget
iii. Accuracy needed
b. Small sample Lower reliability
Large sample Likely to give higher reliability
Minimizing potential sources of errors
a. Use Sampling Statistics to calculate sample size for a given
accuracy (Confidence Interval)
b. Care exercised in determining sample size & sample type
will minimize errors

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6. Organizing &
Carrying out field work
Field work: Selecting, Training, Controlling & Evaluating field
force
Involves substantial portion of budget
Potential source of errors through lack of Validity & Reliability
Problems in achieving Scientific Method
a.Varying skills of field workers
b.Forms filled without interview
c. May not follow instruction
d.Investigators bias
e.Respondents bias

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6. Organizing &
Carrying out field work
Minimizing potential sources of errors
a.Follow good practices in selection, training,
controlling & evaluating field workers
b.Incorporate Back Checks & Spot Checks
c. Motivate supervisors
d.Deploy adequate field force release time
pressure

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7. Analyzing Data &
Report Preparation
Problems in achieving Scientific Method
a. Care & precaution not taken during editing, coding & data
entry
b. List of needed information not prepared properly
c. Research objectives not established correctly
Minimizing potential sources of errors
a. Editing & Coding done carefully
b. Incorporate extensive validity checks
c. Inferences to be drawn based on factual data & not based
upon researchers personal understanding

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Sampling Methods

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Sampling Methods

Sampling Methods:
Probability Methods: Random,
Stratified Random, Cluster
Non Probability Methods:
Convenience, Quota, &
Judgment

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Sampling Methods - Probability

Sampling Methods:
Random Samples equal chance of anyone
being picked
May select those not in the target group
indiscriminate
Sample sizes may need to be large to be
representative
Can be very expensive

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Sampling Methods - Probability

Stratified or Segment Random Sampling


Samples on the basis of a representative strata or
segment
Still random but more focussed
May give more relevant information
May be more cost effective

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Sampling Methods - Probability

Cluster Sampling
Primarily based on geographical areas or clusters
that can be seen as being representative of the
whole population

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Sampling Methods Non Probability

Quota Sampling
Again by segment
Not randomly selected
Specific number on each segment are
interviewed, etc.
May not be fully representative
Cheaper method

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Sampling Methods Non Probability

Multi-Stage Sampling
Sample selected from multi stage sub-groups
Snowball Sampling
Samples developed from contacts of existing
customers word of mouth type approach!

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