Lesson 1

Chapter 1
M
INTRODUCTION TO c
RESEARCH C
C

1 d
 WHAT IS RESEARCH?
• Good decision making fetches a “yes” answer to the
following questions:
- Do managers identify where exactly the problem
lies, do they correctly recognize the relevant factors in
the situation needing investigation?
- Do they know what types of information are to be
gathered and how?
- Do they know how to make use of the information so
collected and draw appropriate conclusions to make
the right decisions, and finally?
- Do they know how to implement the results of this
process to solve the problem?

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 WHAT IS RESEARCH?
• Research is the process of finding solutions to a
problem after a thorough study and analysis of
the situational factors.

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 DEFINITION OF RESEARCH
Business Research is:
An organized, systematic,
data-based, critical,
objective, scientific inquiry or
investigation into a specific
problem, undertaken with
the purpose of finding
answers or solutions to it.

• Data can be quantitative (structured questioner)

or qualitative (Open-ended questioner).
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RESEARCH AND THE MANAGER

In business, research is
usually primarily conducted
to resolve problematic issues
in, or interrelated among,
the areas of accounting,
finance, management, and
marketing.

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 RESEARCH AND THE MANAGER
• In Accounting, budget control
systems, practices, and procedures are
frequently examined.
- Inventory costing methods,
- accelerated depreciation,
- time-series behavior of quarterly
earnings,
- transfer pricing,
- cash recovery rates, and taxation
methods are some of the other areas
that are researched.
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 RESEARCH AND THE MANAGER

• In Finance,
- the operations of financial
institutions,
- optimum financial ratios, mergers
and acquisitions, leveraged
buyouts, intercorporate financing,
yields on mortgages, the
behavior of the stock exchange,
and the like, become the focus of
investigation
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RESEARCH AND THE MANAGER
• Management research could
encompass
- the study of employee
attitudes and behaviors,
human resources management,
the impact of changing
demographics
- on management practices,
production operations
management, strategy
formulation, information
systems, and the like.
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 RESEARCH AND THE MANAGER

• Marketing research could

address issues pertaining to
- product image, advertising,
sales promotion,
- distribution, packaging, pricing,
- after-sales service, consumer
preferences,
- new product development, and
other marketing aspects.

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TYPES OF BUSINESS RESEARCH
1. Applied research
• is to solve a current problem
faced by the manager in the work
setting, demanding a timely
solution.
2. Basic research “fundamental –
pure”
• Research done chiefly to generates
a body of knowledge by trying to
comprehend how certain problems
that occur in organizations can be
solved.
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 APPLIED VERSUS BASIC
RESEARCH
Basic Research Applied research
• Additional to Knowledge. • Solution to existing
problems.
• Discovery / Invention
• Innovation / Application
• Mere Academic.
• Practical use for solving
problems.

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 Examples Applied Research
Apple’s iPod fueled the company’s success in recent years,
helping to increase sales from $5 billion in 2001 to $32
billion in the fiscal year 2008. Growth for the music player
averaged more than 200% in 2006 and 2007, before falling
to 6% in 2008. Some analysts believe that the number of
iPods sold will drop 12% in 2009. “The reality is there’s a
limited group of people who want an iPod or any other
portable media player,” one analyst says. “So the question
becomes, what will Apple do about it?”
The existing machinery in the production department has
had so many breakdowns that production has suffered.
Machinery has to be replaced. Because of heavy
investment costs, a careful recommendation as to whether
it is more beneficial to buy the equipment or to lease it is
needed. 12
Examples Basic Research
• Right from her days as a clerical
employee in a bank, Sandra had
observed that her colleagues,
though extremely knowledgeable
about the nuances and intricacies
of banking, were exerting very
little effort to improve the
efficiency and effectiveness of
the bank in the area of customer
relations and service.

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 Examples Basic Research
• When she left the bank and did her
dissertation for her Ph.D., her topic of
investigation was Job Involvement,
or the ego investment of people in
their jobs.
• The conclusion of her investigation was
that the single most important
contributory factor to job involvement
is the fit or match between the nature
of the job and the personality
predispositions of the people engaged
in performing it.

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 Examples Basic Research
• Subsequently, when Sandra
joined the Internal Research
Team of a Fortune 500
Company, she applied this
knowledge to solve
problems of motivation, job
satisfaction, job
involvement, and the like, in
the organization.

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More Examples of Research Areas in
Business

• Absenteeism
• Communication
• Motivation
• Consumer decision making
• Customer satisfaction
• Budget allocations
• Accounting procedures

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More Examples of Research Areas in Business
• The main distinction between applied and basic
business research is that
- the former is specifically aimed at solving a
currently experienced problem,
- whereas the latter has the broader objective of
generating knowledge and understanding of
phenomena and problems that occur in various
organizational settings.
• Despite this distinction, both types of research
follow the same steps of systematic inquiry to
arrive at solutions to problems.

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 WHAT RESEARCH IS NOT
1. Research is not mere information gathering.
A sixth grader comes home from
school and tells her parents, “The
teacher sent us to the library today to
do research, and I learned a lot about
black holes.” For this student, research
means going to the library to glean a
few facts. This may be information
discovery; it may be learning reference
skills; but it certainly is not, as the
teacher labeled it, research.
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WHAT RESEARCH IS NOT
2. Research is not mere transportation of
facts from one location to another.
• A college student reads several articles about the
mysterious “Dark Lady” in the sonnets of William
Shakespeare and then writes a “research paper”
describing various scholars’ suggestions of who she
might have been.
Although the student does, indeed, go through
certain activities associated with formal research—
collecting information, organizing it in a certain way
for presentation to others, referencing statements
properly, and so on—these activities still do not add
up to a true research paper
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 WHAT RESEARCH IS NOT
•Unfortunately, many students
think that looking up a few
facts and presenting them in a
written paper with benefit of
references constitutes
research. Such activity might
more realistically be called
fact transcription, fact
organization, or fact
summarization.
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 WHAT RESEARCH IS NOT
3. Research is not merely rummaging for
information
The house across the street is for sale. You consider
buying it, and so you call your realtor to find out for how
much your present home would sell. “I’ll have to do
some research to determine the fair market value of your
property,” the realtor tells you.
• Such an activity involves little more than rummaging
through files to discover what the realtor previously did
not know.
• Rummaging, whether through one’s personal records or
at the public or college library, is not research. It is more
accurately called an exercise in self-enlightenment.
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RESEARCH CHARACTERISTICS
Although research projects vary in complexity
and duration, research typically has 8 distinct
characteristics:

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 RESEARCH CHARACTERISTICS
1. Research originates with a question or problem
The world is filled with unanswered questions and
unresolved problems. Everywhere we look, we see
things that cause us to wonder, to speculate, to ask
questions.

By asking questions, we strike the

first spark igniting a chain reaction
that leads to the research process. An
inquisitive mind is the beginning of
research; as one popular tabloid puts
it, “Inquiring minds want to know!”
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 RESEARCH CHARACTERISTICS
2. Research requires clear articulation of a goal
A clear, unambiguous statement of the
problem is critical.
The ultimate goal of the research must
be set forth in a grammatically
complete sentence that specifically and
precisely answers the question, “What
problem do you intend to solve?”
When you describe your objective in
clear, concrete terms, you have a good
idea of what you need to accomplish
and can direct your efforts accordingly.
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 RESEARCH CHARACTERISTICS
3. Research requires a specific plan for proceeding
Research is not a blind excursion
into the unknown, with the hope
that the data necessary to answer
the question at hand will
somehow fortuitously turn up.
It is, instead, a carefully planned
itinerary of the route you intend
to take in order to reach your final
destination—your research goal.

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 RESEARCH CHARACTERISTICS
Consider the title of this text:
Practical Research: Planning and Design.
The last three words are the important ones.
Researchers plan their overall research design and
specific research methods in purposeful way so that
they can acquire data relevant to their research
problem. Depending on the research question,
different designs and methods will be more or less
appropriate.

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RESEARCH CHARACTERISTICS
4. Research usually divides the principal problem
into more manageable subproblems
• From a design standpoint, it is
often helpful to break a main
research problem into several
subproblems that, when solved,
will resolve the main problem.
• Breaking down principal problems
into small, easily solvable
subproblems is a strategy we use
in everyday living.
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RESEARCH CHARACTERISTICS
• Main problem: How do I get from Town A to Town
B?
• Subproblems:
1. What is the most direct route?
2. How far do I travel on the highway?
3. Which exit should I take to leave the highway?

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 RESEARCH CHARACTERISTICS
5. Research is guided by the specific research
problem, question, or hypothesis
• The researcher usually forms one or more
hypotheses about what he or she may
discover. A hypothesis is a logical
supposition, a reasonable guess, an
educated conjecture.
• It may direct your thinking to possible
sources of information that will aid in
resolving one or more subproblems and, in
the process, the principal research
problem.

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 RESEARCH CHARACTERISTICS
6. Research accepts certain critical assumptions.
• The assumptions must be valid or else the research is
meaningless. For this reason, careful researchers—
certainly those conducting research in an academic
environment—set forth a statement of their
assumptions as the bedrock upon which their study
must rest.

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RESEARCH CHARACTERISTICS
7. Research requires the collection and
interpretation of data in an attempt to
resolve the problem that initiated the
research.
•The significance of the data depends on
how the researcher extracts meaning
from them.
•In research, data uninterpreted by the
human mind are worthless: They can
never help us answer the questions we
have posed. 31
 RESEARCH CHARACTERISTICS
• Data demand interpretation. But no rule,
formula, or algorithm can lead the researcher
unerringly to a correct interpretation.
• Interpretation is inevitably subjective: It
depends entirely on the researcher’s
hypotheses, assumptions, and logical
reasoning processes.

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RESEARCH CHARACTERISTICS
• Thus, research methodology has two primary
functions:
a. To dictate and control the acquisition of data
b. To corral the data after their acquisition and
extract meaning from them.

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RESEARCH CHARACTERISTICS
8. Research is, by its nature, cyclical or, more
exactly, helical. The research process follows a
cycle and begins simply. It follows logical,
developmental steps:
a. A questioning mind observes a particular situation
and asks, Why? What caused that? How come? (This is
the subjective origin of research.)
b. One question becomes formally stated as a
problem. (This is the overt beginning of research.)
c. The problem is divided into several simpler, more
specific subproblems.
d. Preliminary data are gathered that appear to bear
on the problem.
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RESEARCH CHARACTERISTICS
e. The data seem to point to a tentative solution
of the problem. A guess is made; a hypothesis
or guiding question is formed.
f. Data are collected more systematically.
g. The body of data is processed and
interpreted.
h. A discovery is made; a conclusion is reached.
i. The tentative hypothesis is either supported
by the data or is not supported; the question is
either answered (partially or completely) or not
answered.
j. The cycle is complete. 35
Why managers should know about research
• Being knowledgeable about research and research
methods helps professional managers to:
• Identify and effectively solve minor problems in the
work setting.
• Know how to discriminate good from bad research.
• Appreciate the multiple influences and effects of
factors impinging on a situation.
• Take calculated risks in decision making.
• Prevent possible vested interests from exercising
their influence in a situation.
• Relate to hired researchers and consultants more
effectively.
• Combine experience with scientific knowledge
while making decisions. 36
 The Manager–Researcher Relationship
• Managers with knowledge of
research have an advantage over
those without.
• Knowledge of research and problem-
solving process helps managers to
identify problem situations before
they get out of control.
• Minor problems can be solved by the
manager, major problems would
warrant the hiring of outside
researchers or consultants.
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 The Manager–Researcher Relationship
• The manager who is knowledgeable
about research can interact effectively
with the researchers.
• Knowledge about research process also
helps managers to become
discriminating recipients of the research
findings presented, and to determine
whether or not the recommended
solutions are appropriate for
implementation.
• Understand business journals and
studies

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INTERNAL VERSUS EXTERNAL
CONSULTANTS / RESEARCHERS
Internal Consultants/Researchers:
Some organizations have their own research
department, which might be called:
- The management services department
- The organization and methods department
- R & D (research and development department)
• Such a department within the organization serves
as the internal consultant if it face certain
problems and seek help.
• This unit would be useful in several ways
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Internal Researchers
• Advantages:
• Better acceptance from staff
• Knowledge about organization
• Would be an integral part of
implementation and
evaluation of the research
recommendations.
• Disadvantages:
• Less fresh ideas
• Power politics could prevail
• Possibly not valued as
“expert” by staff 40
 External Researchers
• Advantages:
• Divergent and convergent thinking
• Experience from several situations
in different organizations
• Better technical training, usually
• Disadvantages:
• Takes time to know and understand the
organization
• Rapport and cooperation from staff not
easy
• Not available for evaluation and
implementation
• Costs
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 KNOWLEDGE ABOUT
RESEARCH
AND MANAGERIAL
EFFECTIVENESS
• Managers are responsible for
the final outcome by making
the right decisions at work.
• Knowledge about research
enhances the sensitivity of
managers to internal and
external factors of varied
situations at work
environment…

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 ETHICS AND BUSINESS
RESEARCH
• Ethics in business research refers to a code of
conduct of behavior while conducting research.
• Ethical conduct applies to the organization and the
members that sponsor the research, the researchers
who undertake the research, and the respondents
who provide them with the necessary data.

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ETHICS AND BUSINESS RESEARCH
• The members that sponsor the research should do
it in good faith, pay attention to what the results
indicate, and pursue organizational rather than
self-interest.
• Ethical conduct should also be reflected in the
behavior of the researchers who conduct the
investigation, the participants who provide the
data, the analysts who provide the results, and the
entire research team that presents the
interpretation of the results and suggests
alternative solutions.

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DISCUSSION QUESTIONS
1. Why should a manager know about research
when the job entails managing people,
products, events, environments, and the like?
2. For what specific purposes is basic research
important?
3. When is applied research, as distinct from
basic research, useful?
4. Why is it important to be adept in handling
the manager–researcher relationship?
5. Explain, giving reasons, which is more
important, applied or basic research.
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 DISCUSSION QUESTIONS
6. Give two specific instances where an external
research team would be useful and two other
scenarios when an internal research team will be
deployed, with adequate expla-nations as to why
each scenario is justified for an external or
internal team.
7. Describe a situation where research will help
you as a manager to make a good decision.
8. Given the situations below, (a) discuss with
reasons whether they fall into the category of
applied or basic research, and (b) for Scenario 1,
explain with reasons, who will conduct the
research. 46
Scenario 1
• To Acquire or Not to Acquire: That is the Question
Companies are very interested in acquiring other firms
even when the latter operate in totally unrelated realms
of business. For example, Gencore Industries manufacturing
asphalt plants for road construction acquired Ingersoll-
Rand in 1996, and later acquired yet another company
engaged in the business of food processing. Such
acquisitions are claimed to “work miracles”. However,
given the volatility of the stock market and the slowing
down of business, many companies are not sure whether
such acquisitions involve too much risk. At the same
time, they also wonder if they are missing out on a great
business opportunity if they fail to take such risk. Some
research is needed here!
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