Business Research Methods

GBUS 3323 Lecture One

Homework Sets – 500 pts Final Case Analysis – 250 pts (due week 5). Participation - 50 pts 4 Quizzes – 200 pts Late Work – 10% off per day late. –
H: 918-331-0129 W: 800-468-6292 ext.289 We will complete Case 31 during Week 4

• Let us stop passing judgment on one another. Instead make up your mind not to put an obstacle or a stumbling block in your brother’s way. (Romans 14:13)

Degree of Problem Definition
Exploratory Research Research (Unaware of Problem) Clearly Defined) Descriptive Research (Aware of Problem) Causal (Problem

possible situation

“Our sales are declining and “What kind of people are buying “Will buyers purchase more of we don’t know why.” our product? Who buys our our products in a new package? competitor’s product?” “Would people be interested “Which of two advertising in our new product idea?” “What features do buyers prefer Why Define? campaigns is more effective?” in our product?”

Why Measure?

Three categories of business research……

Exploratory Research
• Initial research conducted to clarify and define the nature of a problem • Does not provide conclusive evidence • Subsequent research expected

Descriptive Research
• Describes characteristics of a population or phenomenon • Some understanding of the nature of the problem

Descriptive Research Example
• • • • • Weight Watchers average customer Woman about 40 years old Household income of about $50,000 At least some college education Trying to juggle children and a job

Causal Research
• Conducted to identify cause and effect relationships

Identifying Causality
• A causal relationship is impossible to prove. • Evidence of causality:
– 1. The appropriate causal order of events – 2. Concomitant variation--two phenomena vary together – 3. An absence of alternative plausible explanations

Stages of the Research Process
Problem Discovery and Definition Discovery and Definition

Research Design

and so on Conclusions and Report

Sampling Data Processing and Analysis Data Gathering

Problem Discovery And Definition
• • • • First step Problem, opportunity, or monitor operations Discovery before definition Problem means management problem

• A statement • that can be refuted • by empirical data

If you do not know where you are going, any road will take you there.

Exploratory Research Techniques Two Examples
• Secondary data (historical data)
– Previously collected – Census of population – Literature survey

• Pilot study
– A number of diverse techniques

Research Design
• Master plan • Framework for action • Specifies methods and procedures

Basic Research Methods
• • • • Surveys Experiments Secondary data Observation

Selecting a Sample
Sample: subset of a larger population. SAMPLE

• Who is to be sampled? • How large a sample? • How will sample units be selected?


Research Proposal
• A written statement of the research design that includes a statement explaining the purpose of the study. • Detailed outline of procedures associated with a particular methodology RESEARCH PROJECT VERSUS RESEARCH PROGRAM

What is the Shape?
In the nine-dot square (shown in the Textbook) connect all nine dots with no more than four straight lines without lifting the pencil from the paper.

Problem Definition
• The indication of a specific business decision area that will be clarified by answering some research questions.

Ascertain the Decision Maker’s Objectives
• Decision makers’ objectives • Managerial goals expressed in measurable terms.


The Iceberg Principle
• The principle indicating that the dangerous part of many business problems is neither visible to nor understood by managers.

Understand the Background of the Problem
• Exercising judgment • Situation analysis - The informal gathering of background information to familiarize researchers or managers with the decision area.


Isolate and Identify the Problems, Not the Symptoms
• Symptoms can be confusing


Symptoms Can Be Confusing
Twenty-year-old neighborhood swimming association: • Membership has been declining for years. • New water park -residents prefer the expensive water park???? • Demographic changes: Children have grown up

Organization Twenty-year-old neighborhood swimming association in a major city.

Symptoms Membership has been declining for years. New water park with wave pool and water slides moved into town a few years ago.

Problem Definition Based on Symptom Neighborhood residents prefer the expensive water park and have negative image of swimming pool.

True Problem Demographic changes: Children in this 20year-old neighborhood have grown up. Older residents no longer swim anywhere.

What Language Is Written on This Stone Found by Archaeologists?

Determine the Unit of Analysis
• Individuals, households, organizations, etc. • In many studies, the family rather than the individual is the appropriate unit of analysis.


Determine the Relevant Variable
• Anything that may assume different numerical values


Types of Variables
• • • • Categorical Continuous Dependent Independent

Basic Questions Problem Definition
• • • • • • • What is the purpose of the study? How much is already known? Is additional background information necessary? What is to be measured? How? Can the data be made available? Should research be conducted? Can a hypothesis be formulated?

Basic Questions Basic Research Design
• What types of questions need to be answered? • Are descriptive or causal findings required? • What is the source of the data?

Basic Questions Basic Research Design
• Can objective answers be obtained by asking people? • How quickly is the information needed? • How should survey questions be worded? • How should experimental manipulations be made?

Basic Questions Selection of Sample
• • • • • • • • Who or what is the source of the data? Can the target population be identified? Is a sample necessary? How accurate must the sample be? Is a probability sample necessary? Is a national sample necessary? How large a sample is necessary? How will the sample be selected?

Basic Questions Data Gathering
• • • • Who will gather the data? How long will data gathering take? How much supervision is needed? What operational procedures need to be followed?

Basic Questions Data Analysis
• Will standardized editing and coding procedures be used? • How will the data be categorized? • What statistical software will be used? • What is the nature of the data? • What questions need to be answered? • How many variables are to be investigated simultaneously? • Performance criteria for evaluation?

Basic Questions Type of Report
• Who will read the report? • Are managerial recommendations requested? • How many presentations are required? • What will be the format of the written report?

Basic Questions Overall Evaluation
• • • • How much will the study cost? Is the time frame acceptable? Is outside help needed? Will this research design attain the stated research objectives? • When should the research be scheduled to begin?

Anticipating Outcomes
• Dummy tables • Representations of the actual tables that will be in the findings section of the final report; used to gain a better understanding of what the actual outcomes of the research will be.

What does Statistics Mean?
• Descriptive statistics
– Number of people – Trends in employment – Data

• Inferential statistics
– Make an inference about a population from a sample

Population Parameter Versus Sample Statistics

Population Parameter
• Variables in a population • Measured characteristics of a population • Greek lower-case letters as notation

Sample Statistics
• Variables in a sample • Measures computed from data • English letters for notation

Making Data Usable
• Frequency distributions • Proportions • Central tendency
– Mean – Median – Mode

• Measures of dispersion

Frequency Distribution of Deposits
Frequency (number of people making deposits in each range) 499 530 562 718 811 3,120

Amount less than $3,000 $3,000 - $4,999 $5,000 - $9,999 $10,000 - $14,999 $15,000 or more

Percentage Distribution of Amounts of Deposits
Amount Percent less than $3,000 $3,000 - $4,999 $5,000 - $9,999 $10,000 - $14,999 $15,000 or more 16 17 18 23 26 100

Probability Distribution of Amounts of Deposits
Amount less than $3,000 .16 $3,000 - $4,999 .17 $5,000 - $9,999 .18 $10,000 - $14,999 .23 $15,000 or more .26 Probability

Measures of Central Tendency
• Mean - arithmetic average
– µ, Population;

, sample

• Median - midpoint of the distribution • Mode - the value that occurs most often

Population Mean

ΣX µ= N


Sample Mean

Σ Xi X= n

Measures of Dispersion
• The range • Standard deviation

The Range as a Measure of Spread
• The range is the distance between the smallest and the largest value in the set. • Range = largest value – smallest value

Deviation Scores
• The differences between each observation value and the mean:

d x x
i = i −

Low Dispersion Verses High Dispersion

4 3 2 1 150 160

Low Dispersion

170 180 190 Value on Variable



Low Dispersion Verses High Dispersion

4 3 2 1 150 160 170 180

High dispersion




Value on Variable

The Variance


σ Sample




Σ( X − X ) S = n −1


• The variance is given in squared units • The standard deviation is the square root of variance:

Sample Standard Deviation


2 Σ ( Xi − X ) n−1

The Normal Distribution
• Normal curve • Bell shaped • Almost all of its values are within plus or minus 3 standard deviations • I.Q. is an example

Normal Distribution


Normal Distribution

13.59% 2.14%



13.59% 2.14%

Normal Curve: IQ Example






Standardized Normal Distribution
• Symetrical about its mean • Mean identifies highest point • Infinite number of cases - a continuous distribution

Standard Normal Curve
• The curve is bell-shaped or symmetrical • About 68% of the observations will fall within 1 standard deviation of the mean • About 95% of the observations will fall within approximately 2 (1.96) standard deviations of the mean • Almost all of the observations will fall within 3 standard deviations of the mean

A Standardized Normal Curve







The Standardized Normal is the Distribution of Z



Standardized Scores

x−µ z= σ
Z= Value-Mean/Standard Deviation

Standardized Values
• Used to compare an individual value to the population mean in units of the standard deviation

x−µ z= σ

Standard Error of the Mean
• Standard deviation of the sampling distribution

Standard Error of the Mean

σ Sx = n

Distribution Population Sample



Standard Deviation



Parameter Estimates
• Point estimates • Confidence interval estimates

Confidence Interval

µ = X ± a small sampling error


E = Z cl S X

µ=X ±E

Estimating the Standard Error of the Mean

Sx =

S n

µ = X ± Z cl

S n

Questions for Chapter 17

Descriptive Analysis
• The transformation of raw data into a form that will make them easy to understand and interpret; rearranging, ordering, and manipulating data to generate descriptive information

Type of Measurement

Type of descriptive analysis

Two categories

Frequency table Proportion (percentage) Frequency table Category proportions (percentages) Mode

More than two categories

Type of Measurement

Type of descriptive analysis


Rank order Median

Type of Measurement

Type of descriptive analysis


Arithmetic mean

Type of Measurement

Type of descriptive analysis Index numbers Geometric mean Harmonic mean


• Tabulation - Orderly arrangement of data in a table or other summary format • Frequency table • Percentages

Frequency Table
• The arrangement of statistical data in a rowand-column format that exhibits the count of responses or observations for each category assigned to a variable

Central Tendency
Measure of Central Tendency Mode Median Mean

Type of Scale Nominal Ordinal Interval or ratio

Measure of Dispersion None Percentile Standard deviation

• A technique for organizing data by groups, categories, or classes, thus facilitating comparisons; a joint frequency distribution of observations on two or more sets of variables • Contingency table- The results of a crosstabulation of two variables, such as survey questions

• • • • Analyze data by groups or categories Compare differences Contingency table Percentage cross-tabulations

• The number of respondents or observations (in a row or column) used as a basis for computing percentages

Charts and Graphs
• Pie charts • Line graphs • Bar charts
– Vertical – Horizontal

Line Graph

Bar Graph
90 80 70 60 50 40 30 20 10 0 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr East West North

WebSurveyor Bar Chart
How did you find your last job? 643 Netw orking 213 print ad 179 Online recruitment site 112 Placement firm 18 Temporary agency 9.6 %

Temporary agency

1.5 %

Placement firm

Online recruitment site

15.4 %

print ad

18.3 %

Netw orking

55.2 %









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