CONCEPTUAL
FOUNDATIONS
7th and 8th
Learning Outcomes

Students should be able to summarize conceptual
foundations needed in business research
Outlines




The importance of conceptual foundation in business
research
The interdependence between conceptual
foundation and the research’s purposes
Using previous findings and scientific reading as
conceptual foundations
Conceptual foundations and variables of the
research
Copyright © 2003 John Wiley & Sons, Inc. Sekaran/RESEARCH 4E
FROM CHAPTER 5
The Importance of Conceptual
Foundations



After formulating research problem, the next step in
research process is collecting theories, concepts, and
previous research that can be generalized as
conceptual foundations for future research
The researchers are expected to have rigid
foundation of the research, not just trial-error action
Thus, conceptual foundation is one of scientific way
in gathering information about the theories as well
as the issues
The Interdependence between Conceptual
Foundation and Research Purposes
Sharpen and deepen the scope of the research’s
variable
The basis for formulating hypothesis and research
design
The basis for discussing the results of the study,
giving advice for problem-solving situation
The Use of Previous Finding and
Scientific Reading

Technically, the results of the study which is
relevant with what future research to be done
can be depicted from: the problem, timing,
location, sample of the research, research
method, analysis method and conclusion.
Conceptual Foundations and Research
Variables
The conceptual foundation characterized that the study is scientific
Theories, concepts and generalization of previous researches can
be supporting the future research
Conceptual foundation at least consists of the explanation of the
variables
There is a need for the existence of conceptual foundation, so that
the research has a rigid basis not just trial error
Through definitions from many references, the scope and
prediction of the connectedness between research variables
becoming more clearly and precisely
Research variables that can not be explained well by the
researcher showed that the researcher does not understand the
theory used in his own research
Variables



Variable is anything that can take on differing or
varying values.
The values can differ at various times for the same
object or person, or at the same time for different
objects or person.
Examples:
 Production
units
 Absenteeism
 Motivation
Production Units



One worker in the manufacturing department may
produce one widget per minute, a second might
produce two per minute, a third might produce five
per minute.
It is also possible that the same member could
produce one widget the first minute, and five the
next minute.
In both cases, the number of widgets produced has
taken on different values, and is therefore a
variable.
Absenteeism


Today, three members in the sales department may
be absent, tomorrow six members may not show up
for work; the day after, there may be no one
absent.
The value can thus theoretically range from “zero”
to “all” being absent, on the absenteeism variable.
Motivation



The levels of motivation of members to learn in the
class or in a work team might take on varying
values ranging from “very low” to “very high”.
An individual’s motivation to learn from different
classes or in different teams might also take on
differing values.
The factor called motivation has to be reduced from
its level of abstraction and operationalized in a
way that it become measurable.
Types of Variables




The dependent variable (criterion variable)
The independent variable (predictor variable)
The moderating variable
The intervening variable
Dependent Variable


The variable of primary interest to the researcher
(finding what variables influence it), it is possible to
find answers or solutions to the problem.
Example:
A
vice president is concerned that the employees are
not loyal to the organization, and in fact seem to switch
their loyalty to other institutions. The dependent
variable in this case would be organizational loyalty
Independent Variable


One that influences the dependent variable in either
a positive or negative way.
Example:
 Research
studies indicate that successful new product
development has an influence on the stock market price
of the company. That is the more successful the new
product turns out to be, the higher will be the stock
market price of the firm. Therefore, the success of the
new product is the independent variable, and stock
market price is the dependent variable
Moderating Variable


One that has a strong contingent effect on the
independent variable—dependent variable
relationship
Example:

It has been found that there is a relationship between the
availability of Reference Manuals that manufacturing
employees have access to, and the number of product rejects.
•
However, only those who have interest and urge to refer to
the manual every time a new process is adopted will
produce flawless products. Others who do not will continue
to produce defective products.
Intervening Variable


One that surfaces between the time the independent
variable start operating to influence the dependent
variable and the time their impact is felt on it.
Example:

Where workforce diversity (IV) influences organizational
effectiveness (DV), the intervening variable that surfaces as
a function of the diversity in the workforce is creative
synergy, which results from a multiethnic, multiracial, and
multinational workforce interacting and bringing together
their multifaceted expertise in problem solving.
The Relationship among the independent, intervening,
moderating and dependent variable


From the previous figure, it would be interesting to
see how the inclusion of the managerial expertise as
moderating variable would change the model or
affect the relationship.
Managerial expertise moderates the relationship
between workforce diversity and creative synergy.
What would be the dependent
variable in this case?




A manager is concerned that the sales of a new product
introduced after its test market do not meet with his
expectations.
A basic researcher is interested in investigating the
debt-to-equity ratio of manufacturing companies in
Tangerang.
An applied researcher wants to increase the
performance of organizational members in a particular
bank.
A marketing manager wonders why the recent
advertisement strategy does not work.
Label the variables below…….



Cross cultural research indicates that managerial values
govern the power distance between superiors and
subordinates (power distance means egalitarian
interactions between the boss and the employee, versus
the high power superior in limited interaction with the
low power subordinate).
A manager believes that good supervision and training
would increase the production level of the workers.
A consultant is of the opinion that much benefit would
accrue by buying and selling at the appropriate times
in a financial environment where the stocks are volatile.