Business research is defined as the systematic and objective process of gathering, recording, and analyzing data for aid in making business decisions (Zikrmund). Cooper and Schindler define business research as a systematic enquiry that provides information to guide managerial decisions. Decision making is always a crucial part of any organizational functioning. In the field of business research, this valuable information is obtained using the following interrelated steps: 1. Problem or opportunity identification 2. Diagnosing the problem or opportunity 3. Executing business research to explore the solutions 4. Implement presented solutions 5. Evaluate the effectiveness of decision making ◦ Evaluation Research ◦ Performance Monitoring Research Foundational—answers basic questions. What business should we be in? Testing—addresses things like new product concepts or promotional ideas. How effective will they be? Issues—examines how specific issues impact the firm. How does organizational structure impact employee job satisfaction and turnover? Performance—monitors specific metrics including financial statistics like profitability and delivery times. They are critical in real-time management and in “what-if” types of analyses examining the potential impact of a change in policy. Time Constraints Availability of Data Nature of the Decision Benefits versus Costs Data—the raw facts—record measures of certain phenomena which are necessary to provide Information—facts in a form suitable for managers to base decisions on. Business Intelligence—The subset of data and information that actually has some explanatory power enabling effective managerial decisions to be made. Relevance Quality Timeliness Completeness Increased globalization Growth of the Internet and other information technologies Knowledge Management Decision Support System Customer Relationship Management Global Business Research ◦ General information about country - economic conditions and political climate ◦ Cultural and consumer factors ◦ Market and competitive conditions - demand estimation Where Business Collects Research Information Source: Cooper & Schindler Learning Objectives ◦ Classify business research ◦ List the major phases of the research process and the steps within each ◦ Explain the difference between a research project and a research program On the basis of specificity of its purpose ◦ Basic ◦ Applied On the basis of decision situation or purpose ◦ Exploratory ◦ Descriptive ◦ Causal Basic research is generally not related to a specific problem and its findings cannot be immediately applied. "The secret of success is to know something nobody else knows. " Aristotle Onassis Applied research directly addresses the problem at hand. Applied research is launched by the firm, agency, or individual facing a specific problem. Is executive success correlated with high need for achievement? Are members of highly cohesive work groups more satisfied than members of less cohesive work groups? What are the characteristics of people who likes to work in team? Should McDonalds add Italian pasta dinners to its menu? Should Procter & Gamble add a high-priced home teeth bleaching kit to its product line? Should one change the packaging of coke? Should Suzuki introduce a luxury car? DESCRIPTIVE CAUSAL COMPLETELY CERTAIN Exploratory Research (Unaware of Problem) “Our sales are declining and we don’t know why.” “Would people be interested in our new product idea?” ABSOLUTE AMBIGUITY Descriptive Research (Aware of Problem) EXPLORATORY Causal Research (Problem Clearly Defined) “What kind of people are buying “Will buyers purchase more of our product? Who buys our our products in a new package? competitor’s product?” “Which of two advertising “What features do buyers prefer campaigns is more effective?” in our product?” Initial research conducted to clarify and define the nature of a problem Does not provide conclusive evidence Subsequent research expected Example: New Product Development Can Use ◦ Open Ended Interviews ◦ Secondary Data ◦ Pilot Study Describes characteristics of a objects, people, groups, organizations, or environments Some understanding of the nature of the problem Discover answers to the questions who, what, when, where, and, sometimes, how. Example: Current Economic or Industry Situation (IBEF), Describe Market Segments Use Survey Methodology Accuracy is important Diagnostic Analysis ◦ ( Belief, features, feelings are important) Conducted to identify cause and effect relationships Before causal studies are undertaken, researchers typically have a good understanding of the phenomena being studied. Example: Smoking causes cancer Process Improvement enhances Operational Performance Experiments, Test Markets Three critical evidences of causality: Temporal Sequence ◦ The appropriate causal order of events Concomitant Variance ◦ two phenomena vary together Nonspurious Association ◦ An absence of alternative plausible explanations Goals to be achieved by conducting research. Problem, opportunity, or monitor operations Set out to “discover” this problem through a series of interviews and through a document called a research proposal. The problem statement often is made only in general terms; what is to be investigated is not yet specifically identified. Albert Einstein Defining the decision situation must precede the research objectives. ◦ analysis of task involved, ◦ environmental context of the problem, and ◦ defining the problem. knowing what is to be accomplished determines the research process. Exploratory preliminary research activities ◦ previous research, pilot studies, focus group interviews, and experience surveys. Management decision problems are usually related with problem symptoms while the business research problems are cause of those symptoms. The research objective should include its scope, its limitations, and the precise meanings of all words and terms significant to the research. Deliverables Hypotheses should be logically derived from and linked to our research objectives. Decision Statements Research Objectives Research Hypotheses Should we allocate more resources towards social networking or TV advertising ? Identify attitude change associated with message communicated with both media A target market customer’s attitude will become more positive by positing on FB than on TV. How we can reduce post purchase complaints? Identify factors responsible for high post purchase complaints. Customers are not satisfied with Tech Support . Packaging is not up to the mark. Should we launch two wheeler for Indian Women? Identify need for independent 2 wheeler for Indian women and features wanted. There exist independent need for 2 wheeler for Indian Women. Indian women wants more vibrant colours. Master plan Framework for action Specifies methods and procedures for collecting and analyzing the needed information Decide about sources of information, the design technique ,the sampling methodology, and the schedule and cost of the research. Surveys Experiments Secondary data Observation Who is to be sampled? (Target Population) Example: to examine the attitudes of U.S. automobile assemblers about quality improvement, the population may be defined as the entire adult population of auto assemblers employed by the auto industry in the United States. How large a sample? How will sample units be selected? • • Data can be gathered by human observers or interviewers, or they may be recorded by machines as in the case of scanner data and Web-based surveys. Data gathering should be consistent Editing and Coding ◦ checking the data collection forms for omissions, legibility, interview errors. ◦ meaningful categories and character symbols must be established for groups of responses Data Analysis ◦ application of reasoning to understand the data that have been gathered ◦ determining consistent patterns and summarizing the relevant details revealed in the investigation. ◦ Appropriate techniques are determined MIS, the characteristics of the research design, and the nature of the data gathered. Effective communication of the research findings using conference call, letter, written report, oral presentation, or some combination of any or all of these methods Interpreting the research results, describing the implications, and drawing the appropriate conclusions for managerial decisions. At a minimum, a research report should contain the following: An executive summary consisting of a synopsis of the problem, findings, and recommendations. An overview of the research: the problem’s background, literature summary, methods and procedures, and conclusions. A section on implementation strategies for the recommendations. A technical appendix with all the materials necessary to replicate the project. When the researcher has only one or a small number of research objectives that can be addressed in a single study, that study is referred to as a research project such as identifying customer segments, selecting the most desirable employee insurance plan, or determining an IPO stock price. When numerous related studies come together to address issues about a single company, we refer to this as a research program . If a new product is being developed, the different types of research : ◦ include studies to identify the size and characteristics of the market; ◦ product usage testing to record consumers’ reactions to prototype products; ◦ brand name and packaging research to determine the product's symbolic connotations; ◦ and test-marketing the new product.