OVERVIEW OF BUSINESS

RESEARCH
Copyright © 2000 by Harcourt, Inc. All rights reserved.
OVERVIEW OF BUSINESS
RESEARCH

Learning outcomes

• define business research

• outline reasons for studying business research
• understand the scientific method as applied to
research
• list and understand the steps in the research
process
• be aware of the ethical issues involved in
research
 BUSINESS RESEARCH DEFINED

What is business research?

Research can be defined as an organised, systematic, databased,

critical, objective, scientific investigation into a specific problem,
undertaken with the purpose of finding answers or solutions to it
(Sekaran, 2005).

Business research is defined as “a systematic inquiry that provides

business information to guide business decisions (Cooper and
Schindler, 1998).

Business research is defined as the systematic and objective

process of generating information for aid in making business
decisions (Zikmund, 2003).
 BUSINESS RESEARCH DEFINED

• 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 don’t know
if we
INFORMATION should
offer on-site
child care?
REDUCES

UNCERTAINTY

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“It ain’t the things we don’t know that gets
us in trouble. It’s the things we know that
ain’t 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.
"The secret of success is to know something
nobody else knows. "
Aristotle Onassis

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 APPLIED RESEARCH

• CONDUCTED WHEN A DECISION

MUST BE MADE ABOUT A SPECIFIC
REAL-LIFE PROBLEM

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 APPLIED RESEARCH EXAMPLE

• Should McDonald’s add Italian pasta

dinners to its menu?
• Business research told McDonald’s it
should not.
• Should McDonalds add a “Whopper
Stopper” burger to its menu?
• The issue is now being researched.

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 WHY STUDY BUSINESS RESEARCH?

• research is a tool that can be used by management to assist

in making better decisions.

• research acts to provide information so that the uncertainty

surrounding decisions is reduced.

• develop skills in the area of evaluating other people's

research.

• to make decisions based on research someone else has

carried out, you will be able to determine how reliable and
valid the information provided by the research is.

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 SCIENTIFIC METHOD

• The analysis and interpretation of empirical

evidence (facts from observation or
experimentation) to confirm or disprove
prior conceptions.

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 SCIENTIFIC METHOD
Good research (both basic and applied) follows the standards
of scientific research method. According to Cooper and
Schindler (1998, p. 18), the features of the scientific
method that characterise good research are:
• purpose clearly defined
• detailed rigorous research process
• research design thoroughly planned
• limitations frankly revealed
• high ethical standards applied
• adequate analysis for decision maker's needs
• findings presented unambiguously
• conclusions justified
• researcher's experience reflected.
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 SCIENTIFIC METHOD
Sekaran (1992, p. 10), refers to these characteristics as the "hallmarks" of
scientific research, which include:
• Purposiveness: Researcher has a stated goal with a definite aim or purpose
for the research.
• Rigor: A good theoretical base and sound methodological design – careful,
scrupulous, exact.
• Testability: Hypothesis can be tested using statistical tests.
• Replicability: Tests should be supported again and again when research is
repeated in other similar situations.
• Precision and confidence: Design research in such a manner that our
findings are close to the truth. Precision relates to how close the sample is
to reality.
Confidence = Probability.
• Objectivity: Conclusions should be objective.
• Generalizability: Scope to take the research to other organisational
settings.
• Parsimony: Simplicity of explanation. Reduced variables.

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THE RESEARCH PROCESS

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THE RESEARCH PROCESS
 THE RESEARCH PROCESS
Step 1: Problem definition

Management problem – Researcher to ensure management has

defined the problem correctly.

Research Problem: the next step the researcher must take is to then
translate this into specific research terms to give the research a clear
purpose

Research Objectives: the researcher must then develop specific

measurable objectives or research questions

Estimate the Value of Information: After finalising objectives and

before proceeding to gather any data an assessment must be made
of the value of obtaining the information. In cases where the value of
the information is less than the cost of gathering such information the
research should not proceed.
 Determining When to Conduct Business Research

Availability of Data Benefits vs.

Time Constraints Nature of the Decision 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

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Potential value of a business research effort should exceed its
estimated costs

Costs
Value •Research
Expenditures
• Decreased Certainty •Delay of Marketing
•Increased Likelihood
Decision and
of a Correct Decision
Possible Disclosure
•Improved Marketing
of Information to
Performance and
Rivals
Resulting Higher •Possible Erroneous
Profits
Research Results

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 THE RESEARCH PROCESS
Step 2: Research design

Designs can be:

-exploratory
-descriptive
-causal.

The choice of design is often determined by:

-objectives of study
-the available data sources
-urgency of decision
-cost.
 THE RESEARCH PROCESS

Step 3: Sampling

Sampling addresses the issue of who the information will

be obtained from, how will we get to them, which specific
individuals (or companies or households) will be included
in the study and how many respondents do we have to
include in a sample.
 THE RESEARCH PROCESS

Step 4: Data analysis and interpretation

This is the step in the process that turns the raw data or
information gathered into an output that will enable the
research objectives to be answered.
 THE RESEARCH PROCESS

Step 5: Recommendations

Once data has been analysed the researcher’s final task

is to draw conclusions and make recommendations based
on these results. The researcher does not make any
decisions. That is left to management.
 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
• Information Systems Research
• Corporate Responsibility Research

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 GLOBAL RESEARCH

• Business Research is increasingly global

• Market knowledge is essential
• A.C. Nielsen - more that 60% international
business

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ETHICAL ISSUES IN BUSINESS
RESEARCH

The purpose of this topic is to raise your awareness of the

ethical issues that can arise when conducting research.
By their very nature ethical issues have no easy answer.
The area of ethics is not black and white but rather
various shades of grey. Hence in this section I will seek
only to make you aware of the issues. It is up to you to
form your own opinion of correct behaviour in the various
situations that may arise.
ETHICAL ISSUES IN BUSINESS
RESEARCH

As Zikmund (2003, p. 78) points out:

In most research situations, three parties are involved: the
researcher, the sponsoring client (user), and the
respondent (subject). The interaction of each of these
parties with one or both of the other two identifies a series
of ethical questions. Consciously or unconsciously, each
party expects certain rights and feels certain obligations
toward the other party.