 business research information is not intuitive or haphazardly
gathered.
NATURE OF BUSINESS RESEARCH
Business research spans various aspects of an organization, from
market trends to employee turnover rates. Managers utilize research to
gain insights into uncertainties like future financing conditions or
training needs. This information aids decision-making, whether in
finance, personnel management, or marketing. Business researchers,
known by various titles, employ similar methods despite functional
specialization. Research aims to address information gaps, providing
accurate data to reduce uncertainty in decision-making processes.
Relying solely on intuition for decisions can be risky, akin to betting on a
long shot without research. Business research facilitates a shift from
intuitive decision-making to systematic and objective investigation,
enhancing overall decision quality.
BUSINESS RESEARCH DEFINED
BUSINESS RESEARCH
is the application of the scientific method in searching for the truth

about business phenomena.
 activities include:
defining business opportunities and problems
generating and evaluating alternative courses of action
monitoring employee and organizational performance.
 is more than conducting surveys
 includes idea and theory development, problem definition, searching
for and collecting information, analyzing data, and communicating
the findings and their implications.
 research (re-search) “to search again.”
RESEARCH
 The term connotes patient study and scientific investigation
wherein the researcher takes another, more careful look at the data
to discover all that is known about the subject.
 Ultimately, all findings are tied back to the underlying theory.
 The definition also emphasizes, through reference to the scientific
method, that any information generated should be accurate and
objective.
American humorist Artemus Ward

> 19TH century
> “It ain’t the things we don’t know that gets us in trouble. It’s
the things we know that ain’t so.”
In other words, research isn’t performed to support
preconceived ideas but to test them. The researcher must be personally
detached and free of bias in attempting to find truth. If bias enters into
the research process, the value of the research is considerably reduced.
BUSINESS RESEARCH
Applying the scientific method to understand business phenomena
involves several key steps:
1. OBSERVATION:
 begin by observing the business environment, market trends,
consumer behavior, and any other relevant factors.
2. PROBLEM IDENTIFICATION
 identify specific problems or opportunities within the business. This
could include issues such as declining sales, inefficiencies in
operations, or untapped market segments.
3. HYPOTHESIS FORMATION
 formulate hypotheses or educated guesses about potential causes or
solutions to the identified problems or opportunities. These
hypotheses should be based on available data and existing theories
or models.
4. EXPERIMENTATION
 design and conduct experiments or tests to gather data and validate
or invalidate the hypotheses. This might involve implementing
changes in business processes, marketing strategies, product
offerings, or other variables.
5. DATA ANALYSIS
 analyze the data collected during experimentation to draw
conclusions. Determine whether the results support or refute the
hypotheses and what implications they have for the business.
6. CONCLUSION AND DECISION MAKING
 based on the analysis, draw conclusions about the effectiveness of
different strategies or solutions. Use these insights to make informed
decisions about how to address the identified problems or
opportunities.
7. MONITORING AND ADJUSTMENT
continuously monitor the performance of the implemented solutions

and adjust strategies as needed based on ongoing feedback and
evaluation.
BUSINESS RESEARCH
 isn't limited to for-profit corporations but extends to nonprofits and
government agencies like FEMA or the FDA, which rely on research
to address various issues, akin to businesses like Starbucks or
DuPont.
APPLIED AND BUSINESS RESEARCH
Research can be categorized based on its purpose.
1. BASIC BUSINESS RESEARCH/ PURE RESEARCH
 aims to expand general knowledge without targeting specific
organizational needs.
 conducted without a specific decision in mind, and it usually does not
address the needs of a specific organization.
 It attempts to expand the limits of knowledge in general, and as such
it is not aimed at solving a particular pragmatic problem.
 can be used to test the validity of a general business theory (one that
applies to all businesses) or to learn more about a particular business
phenomenon.
 may test broad business theories or explore phenomena like
employee motivation, offering insights applicable across
organizations.
 often laying the groundwork for applied studies, the distinction
helps clarify research goals.
 does not examine the problem from any single organization’s
perspective
2. APPLIED BUSINESS RESEARCH
 addresses specific decisions for a particular organization
studies that are undertaken to answer questions about specific

problems or to make decisions about particular courses of action or
policies.
 emphasized in this text because most students will be oriented
toward the day-to-day practice of management, and most students
and researchers will be exposed to short-term, problem-solving
research conducted for businesses or nonprofit organizations.
 MANAGERIAL VALUE OF BUSINESS RESEARCH
The managerial value of business research lies in its ability to
align decision-making with the strategic orientation of the firm.
Depending on whether a firm is product-oriented, production-oriented,
or marketing-oriented, different types of research are essential to inform
critical decisions.
3 TYPES OF BUSINESS ORIENTATIONS (PPM)
1. PRODUCT-ORIENTED FIRM
 Prioritizes decision making that emphasizes the physical product
design, trendiness or technical superiority
 Research focuses on technicians and experts in the field
 Ex: The fashion industry makes clothes in styles and sizes that few
can adopt
2. PRODUCTION-ORIENTED FIRMS
 where efficiency and effectiveness in production processes are
paramount
 research involving input from workers, engineers, finance, and
accounting is vital. Such research aids in driving down costs and
optimizing production processes to meet high-volume demands.
 Ex: US auto industry’s assemble-line process is intent on reducing
costs of production as low as possible
3. MARKETING-ORIENTED FIRMS
 prioritize delivering value to customers,
 research focused on understanding consumer desires, beliefs, and
attitudes is essential.
 customer-centric research informs decisions related to product
development, branding, pricing, and distribution, ensuring that the
firm meets customer needs and preferences effectively.
 Ex: well-known hotel chains are designed to address the needs of
travelers, particularly business travelers
The case of Yoplait Go-Gurt exemplifies the tangible benefits of
business research in facilitating effective management decisions. By
conducting consumer research, Yoplait identified a niche market of
moms and kids seeking convenience and portability in yogurt
consumption, particularly during school hours. Traditional packaging
solutions like Colombo Spoon in a Snap provided utensils as part of the
packaging, but Yoplait recognized an opportunity to innovate further.
Through taste tests and observations, Yoplait discovered that kids
preferred a packaging design that allowed them to consume yogurt
without the need for utensils, enabling them to eat yogurt anywhere,
anytime. This insight led to the development of Go-Gurt, packaged in a
unique three-sided tube that allowed for easy squeezing and
consumption. The playful aspect of the packaging appealed to kids, while
the convenience factor resonated with parents.
The success of Go-Gurt, generating over $100 million in sales in
its first year, underscores the importance of aligning product
development with consumer insights garnered through research.
Yoplait's strategic decision to leverage consumer knowledge and invest
in research and development resulted in a highly successful business
strategy, demonstrating the tangible benefits of integrating research into
managerial decision-making processes.
WHEN IS BUSINESS RESEARCH NEEDED:
Business research becomes necessary when making intelligent
decisions is crucial for an organization. However, not every decision
warrants research. Managers must assess several factors to determine
the need for research
 4 FACTORS TO DETERMINE THE NEED FOR RESEARCH 4. BENEFITS VERSUS COSTS
1. TIME CONSTRAINTS  managers weigh the benefits of research against its costs. They
assess whether the expected payoff justifies the investment in
research takes time, and urgent decisions may not allow sufficient
research and whether the information gained will significantly


time for thorough research. In such cases, decisions might be made

improve decision quality. The proposed research expenditure should
without adequate information.
be compared to other uses of available funds.
2. AVAILABILITY OF DATA
DETERMINING WHEN TO CONDUCT BUSINESS RESEARCH
 if the data cannot be obtained, or it cannot be obtained in a timely
fashion, this particular research project should not be conducted.
 researching market potential in countries like Uzbekistan, Time Availabilit Nature of Benefits vs. Conduct
Macedonia, or Rwanda is tough due to scarce data on population and constraint y of data the Costs busines
business activity, hindering informed decision-making for investors s decision research
and businesses.
Is Is it Is the Does the Yes
3. NATURE OF THE DECISION sufficient feasible to decision of value of the
 the significance of the decision and its potential impact on the time obtain the cosiderabl research
organization determine the need for research. available data? e strategic info exceed
before a or tactical the cost of
 the value of business research will depend on the nature of the decision importanc conducting
managerial decision to be made. will be ?E research?
made?
ROUTINE DECISIONS
 may not justify the expense of research No

 Ex: updating a computer manual for minor product changes may not
justify the cost of researching the wording.
STRATEGICALLY IMPORTANT DECISIONS
 may warrant it.
The importance of the decision influences whether research is
conducted, with more critical decisions typically receiving more
attention.
BUSINESS RESEARCH PROCESS: OVERVIEW
DECISION MAKING
Both young adults and businesses face decisions that shape their
future. Whether it's choosing a college or capitalizing on a business
opportunity, decisions are influenced by available data. For businesses,
opportunities and problems guide decision-making. Opportunities offer
potential competitive advantages, like eBay's success in online auctions.
Problems, such as natural disasters, pose risks to operations and
revenue. Identifying and addressing these issues require quality
information.
BUSINESS OPPORTUNITY
 is a situation that makes some potential competitive advantage
possible. Ex: eBay
BUSINESS PROBLEM
 is a situation that makes some significant negative consequence
more likely.
 Ex: A natural disaster can present a problem for many firms as they
face potential loss of property and personnel and the possibility that
their operations, and therefore their revenue, will be interrupted.
SYMPTOMS
 when business problems aren't obvious and aren't easily observable.
 which are observable cues indicating a problem because they're
caused by it.
 an increase in employee turnover is generally only a symptom of a
Businesses tackle symptoms, not the core problem.
RESEARCH
 aids in identifying root causes, enabling decision-makers to address
the actual issue, not just its symptoms. Just as patients describe
symptoms to doctors, decision-makers often rely on research to
pinpoint and tackle underlying problems.
QUALITY INFORMATION
 is crucial for businesses to effectively address both opportunities
and challenges.
DECISION MAKING
 is the process of developing and deciding among alternative ways of
resolving a problem or choosing from among alternative
opportunities.
DECISION MAKER
 must recognize:
 the nature of the problem or opportunity
 identify how much information is currently available how
reliable it is
 determine what additional information is needed to better deal
with the situation.
Every decision-making situation can be classified based on whether it
best represents a problem or an opportunity and where the situation
falls on a continuum from absolute ambiguity to complete certainty.
STAGES IN THE RESEARCH PROCESS (DPPCAF)
Business research comprises a series of interconnected activities. While
the research process may vary, it typically follows six stages:
1. Defining the research objectives
2. Planning a research design
3. Planning sample selection
4. Collecting the data
5. Analyzing the data
6. Formulating the conclusions and preparing the report
CYCLICAL/ CIRCULAR-FLOW PROCESS
 This concept is used because conclusions from research studies can
generate new ideas and knowledge that can lead to further
investigation
 there is a dashed connection between conclusions and reporting and
defining the research objectives. Notice also that management is in
the center of the process. The research objectives cannot be
 properly defined without managerial input. After all, it is the STAGES OF RESEARCH PROCESS
manager who ultimately has to make the decision. It is also the
manager who may ask for additional research once a report is given.
MANAGEMENT INPUT
 is vital in defining research objectives, as managers are ultimately
responsible for decision-making.

 In practice, stages may overlap, with forward and backward linkages

influencing each other.

FORWARD LINKAGE
 implies that earlier stages affect later stages
 Ex: Thus, the research objectives outlined in the first stage affect the
sample selection and the way data are collected. The sample
selection question affects the wording of questionnaire items.
BACKWARD LINKAGE
 suggests later stages influence earlier stages

 Ex: If it is known that the data will be collected via e-mail, then the
sampling must include those with e-mail access.

 The knowledge that the executives who will read the research report
are looking for specific information. The professional researcher
anticipates executives’ needs for information throughout the
planning process, particularly during the analysis and reporting.
 STAGES OF RESEARCH PROCESS  the goals and focus of the research are influenced by the nature of
the decisions that need to be made.

 may be to simply clarify a situation, define an opportunity, or

monitor and evaluate current business operations.
 cannot be developed until managers and researchers have agreed
on the actual business “problem” that will be addressed by the
research.
 set out to “discover” this problem through a series of
interviews and through a document called a research
proposal.
 It should be noted that this process is oriented more toward
discovery than confirmation or justification.
Managers and researchers alike may not have a clear-cut
understanding of the situation at the outset of the research process.
Managers may only be able to list symptoms that could
indicate a problem.
For example, employee turnover is increasing, but management
may not know the exact nature of the problem. Thus, the
problem statement often is made only in general terms; what is to
be investigated is not yet specifically identified.
DELIVERABLES
 is often used to describe the objectives to a research client.

PROBLEM STATEMENT
 In applied business research:
A. DEFINING RESEARCH OBJECTIVES > the objectives are not set until there's a clear grasp of the
RESEARCH OBJECTIVES managerial decision at hand.
 are the goals to be achieved by conducting research. > The understanding wherein shared between the decision maker
and the lead researcher
 are determined by the specific type of decision-making scenario
encountered.
 B. EXPLORATORY RESEARCH
 can be used to help identify and clarify the decisions that need to be
made.
 these preliminary research activities can narrow the scope of the
research topic and help transform ambiguous problems into well-
defined ones that yield specific research objectives.
 By investigating any existing studies on the subject, talking with
knowledgeable individuals, and informally investigating the
situation, the researcher can progressively sharpen the focus of the
research. After such exploration, the researcher should know
exactly which data to collect during the formal phases of the project
and how to conduct the project.
 managers and researchers must decide whether to use one or more
exploratory research techniques.
 this stage is optional
 The business researcher can employ techniques from four basic
categories to obtain insights and gain a clearer idea of the problem:
previous research, pilot studies, case studies, and experience
surveys.
C. STATING RESEARCH OBJECTIVES
 After identifying and clarifying the problem, with or without
exploratory research, the researcher must formally state the
research objectives.
 This statement delineates the type of research that is needed
and what intelligence may result that would allow the decision
maker to make informed choices. The statement of research
objectives culminates the process of clarifying the managerial
decision into something actionable.
WRITTEN DECISION STATEMENT
expresses the business situation to the researcher and makes sure that
managers and researchers are on the same page. The research
objectives try to directly address the decision statement or statements,
as the case may be.
As such,
RESEARCH OBJECTIVES
 represent a contract of sorts that commits the researcher to
producing the needed research.
 this is why they are expressed as deliverables in applied business
research.
 drive the rest of the research process.
 indeed, before proceeding, the researcher and managers must
agree that the objectives are appropriate and will produce relevant
information.
LINKING DECISION STATEMENTS, OBJECTIVES, AND HYPOTHESES
Our hypotheses should be logically derived from and linked to
our research objectives. Exhibit 4.7 illustrates how decision statements
are linked to research objectives, which are linked to research
hypotheses. Although the first two objectives each have one hypothesis,
notice that the third has two. In reality, most research projects will
involve more than one research objective, and each of these may often
involve more than one hypothesis. Think about how you might go about
trying to test the hypothesis listed in Exhibit 4.7.
 D. PLANNING THE RESEARCH DESIGN DATA COLLECTION METHODS
RESEARCH DESIGN 1. Survey
 a master plan that specifies the methods and procedures for 2. Personal interviews
collecting and analyzing the needed information. 3. Observation
 provides a framework or plan of action for the research. The managerial aspects of selecting the research design will be
 Objectives of the study determined during the early stages of considered later.
research are included in the design to ensure that the information
1. SURVEY
collected is appropriate for solving the problem.
THE RESEARCHER ALSO MUST DETERMINE:  the most common method of generating primary data in business
research
 the sources of information
 the design technique (survey or experiment, for example)  is a research technique in which a sample is interviewed in some
form or the behavior of respondents is observed and described in
 the sampling methodology some way.
 the schedule and cost of the research  most people have seen the results of political surveys by Gallup or
SELECTION OF THE BASIC RESEARCH METHOD Harris Online, and some have been respondents (members of a
sample who supply answers) to research questionnaires.
 the researcher must make a decision.
4 BASIC DESIGN TECHNIQUES FOR DESCRIPTIVE AND CAUSAL SURVEYOR
RESEARCH:
1. Surveys  is most often reserved for civil engineers who describe some piece
of property using a transit.
2. Experiments
BUSINESS RESEARCHERS
3. Secondary data
 often characterize a specific group of interest through the use of a
4 . Observation questionnaire.
FACTORS IN DETERMINING WHICH METHOD SHOULD BE CHOSEN  Like:
1. the objectives of the study
 executives
2. the available data sources
employees
3. the urgency of the decision


4. the cost of obtaining the data  customers

 Competitors
DESIGNING THE QUESTIONNAIRE AND SELECTING THE METHOD OF
CONTACT
 are critical steps in survey research design.
Researchers may reach out to respondents via telephone, mail,

internet, or in-person interviews.
For instance, an advertiser spending millions on a Super Bowl
commercial might conduct telephone surveys for quick feedback.
Conversely, a city's economic development director might opt for mail
questionnaires to reach busy executives. In cases requiring sensitive
topics, like a birth control device survey, a flexible method allowing for
personal questions may be necessary.
2. PERSONAL INTERVIEWS
although costly, offer advantages such as the use of visual aids and the
ability to supplement with observations.
Each survey method has its pros and cons, and it's the
researcher's job to select the most suitable approach for gathering
information in a given situation.
Some research projects aim to simply record observable
phenomena, like counting passing cars at a potential gas station site,
which can be done mechanically or by human observation. Mystery
shoppers, who pose as customers to assess sales personnel and store
policies, provide valuable observational data. They observe employee
behavior, adherence to store policies, and the level of customer service,
making them valuable resources for gathering data.
3. OBSERVATION
 it captures behavior directly, without relying on reports from
respondents.
 This data collection method is often unobtrusive and passive,
requiring no direct participation from respondents.
 Ex: Nielsen Media Research uses a "people meter" attached to TVs
to track viewership, avoiding potential bias from self-reported TV
watching habits. However, observation is more complex than
simply counting, and inexperienced researchers may underestimate
its challenges.
 While it eliminates interviewer bias, observation can't capture
intangible aspects like attitudes, opinions, and motivations.
THE “BEST “ RESEARCH DESIGN
 There isn't one best research design.
 Ex: in forecasting sales, options like surveying executives, gathering
sales force opinions, or analyzing trends all offer reliable forecasts.
Choosing the right design improves with experience, as novices
may prefer surveys due to familiarity, but other methods can be just
as effective.
E. SAMPLING
Although the sampling plan is outlined in the research design,
the sampling stage is a distinct phase of the research process. For
convenience, however, we will treat the sample planning and the actual
sample generation processes together in this section. If you take your
first bite of shrimp po-boy and conclude that it needs Tabasco, you have
just conducted a sample.
SAMPLING
 involves any procedure that draws conclusions based on
measurements of a portion of the population.
SAMPLE
 is a subset from a larger population.
If certain statistical procedures are followed, a researcher need
not select every item in a population because the results of a good
sample should have the same characteristics as the population as a
whole. Of course, when errors are made, samples do not give reliable
estimates of the population.
SAMPLING ISSUES: CLUSTER SAMPLING

1. WHO IS TO BE SAMPLED: TARGET POPULATION  is suitable when population members are in close geographical
clusters, reducing costs.
 answer involves identifying a target population who the sample
should reflect.  For instance, selecting 25 counties and sampling within them is
 defining the population and determining sampling units is crucial. more economical than sampling individuals across the entire United
States. The researcher chooses the most suitable sampling
 example: surveying existing savings and loan customers may not procedure based on study objectives.
represent potential customers.
 specifying the target population is a crucial aspect of the sampling F. GATHERING DATA
plan. The data gathering stage begins once the sampling plan has been
formalized.
TARGET POPULATION
DATA GATHERING
 refers to the specific group of individuals or elements that a  is the process of gathering or collecting information.
researcher aims to study or make inferences about through sampling.
It's crucial to define the target population accurately to ensure that  data may be gathered by human observers or interviewers, or they
the sample represents the intended population accurately. may be recorded by machines as in the case of scanner data
and web-based surveys.
2. SAMPLE SIZE DETERMINATION  obviously, the many research techniques involve many methods of
 management may desire to study every potential buyer, but it's often gathering data. surveys require direct participation by research
impractical. respondents.
 larger samples offer greater precision, but smaller ones can still be  this may involve filling out a questionnaire or interacting with
reliable with proper probability sampling. an interviewer. in this sense, they are obtrusive.
 later discussion will address the ideal sample size for UNOBTRUSIVE METHODS OF DATA GATHERING
representativeness.
 are those in which the subjects do not have to be disturbed
 it hinges on the variance within the population. for data to be collected.
3. FINAL SAMPLING DECISION: SELECTION OF SAMPLING UNITS.  they may even be unaware that research is going on at all.
SIMPLE RANDOM SAMPLING  for instance, a simple count of motorists driving past a proposed
franchising location is one kind of data gathering
 is well known, where every unit has an equal chance of selection. method. however the data are collected, it is important to
minimize errors in the process.
 f or example, the data gathering should be consistent in all
geographical areas. if an interviewer phrases questions incorrectly
 or records a respondent’s statements inaccurately (not
verbatim), major data collection errors will result.
G. PROCESSING AND ANALYZING DATA
EDITING AND CODING
 After the fieldwork has been completed, the data must be
converted into a format that will answer the manager’s questions.
 This is part of the data processing and analysis stage.
Here, the information content will be mined from the raw data
DATA PROCESSING
 generally begins with editing and coding the data.
EDITING
 involves checking the data collection forms for omissions, legibility,
and consistency in classification.
 editing process corrects problems such as interviewer errors (an
answer recorded on the wrong portion of a questionnaire, for
example) before the data are transferred to the computer.
Before tabulating data, meaningful categories and character symbols
need establishing for response groups.
CODES
 the rules governing data interpretation, categorization, recording,
and transfer to storage media
CODING PROCESS
 facilitates computer or hand tabulation.
FOR COMPUTER ANALYSIS
data are entered and verified.

 Computer-assisted (online) interviewing exemplifies technological
impact on research.
 Telephone interviewers, using computer terminals, read and type
survey questions and responses directly into the computer.
 Simultaneous data collection and processing reduce potential errors
from intermediate steps.
DATA ANALYSIS
 is the application of reasoning to understand the data that have
been gathered.
 involves reasoning to understand gathered data.
 it can range from identifying patterns to summarizing details.
 the choice of analytical technique depends on management's needs,
research design, and data nature.
 statistical analysis varies from simple frequency distributions to
complex methods like multiple regression.
 later chapters will cover univariate, bivariate, and multivariate
analysis techniques.
H. DRAWING CONCLUSIONS AND PREPARING A REPORT
 communicating research results is a crucial task for researchers,
marking the final but significant stage of a project.
this stage involves interpreting results, discussing implications, and

drawing conclusions relevant to managerial decisions.
 conclusions should align with the promises made in the research
proposal.
 researchers should adapt their communication style based on the
audience's level of understanding.
business research reports often become too technical, but

management typically prefers concise summaries over detailed
technicalities.
 effective communication is paramount; research is only valuable if
its findings are applied.