Role of busi research (brm)


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Role of busi research (brm)

  1. 1. Business Research Methods William G. Zikmund Chapter 1: The Role of Business Research
  2. 2. 2  Comprehensive introduction to Research Methodology (Business Research Methods)  Knowledge acquisition and application of subject matter to real-life situations  Course literature (see the „must read“ section)  Use of multimedia visual aids (MS PowerPoint slides)  Reference to case studies when desirable  Encouragement of questions, comments and constructive criticism from course participants  Analytical and critical thinking, inquisitiveness as well as common sense from course participants also expected How This Course Will Be Conducted
  3. 3. 3  listen attentively  be considerate and amenable  be inquisitive, analytical and critical in your approach to learning research methodology  mention if you do not understand something and seek clarification  read the prescribed course literature. It is the basic requirement for comprehending research methodology and succeeding in this course  start reading from the beginning of the course and not towards the end! • be late to class. • distract the attention of other course participants • use mobile phones or send SMS messages in the class • feel afraid to bring up any relevant point for discussion • hesitate to visit me at my office, individually or as a group, if you have a course-related problem and seek counseling in this regard The DO‘s and DONT‘s Catalogue for Course Participants
  4. 4. Fundamental Course Objectives 4  To acquaint course participants with all salient aspects of research methodology in accordance with the current body of scientific literature on this challenging, interesting and indepensible area of management science  To show that the subject of research methodology has matured into a substantive body of knowledge, an indepth understanding of which is crucial for ensuring the success of commercial or non-commercial organizations  To show and encourage the course participants that the theoretical knowledge acquired in this course can - with the appropriate context-related modifications - be applied to numerous real-life situations in business, public-sector and non-profit enterprises  To stimulate interest in the business research field as a prospective career field
  5. 5. Demands on Course Participants 5  Acquisition and careful application of knowledge  Analytical and critical thinking, innovation, inquisitiveness  Holistic perspective  Quizzes & (proof that the course participant is familar with the essentials Sessionals of research methodology)  Project Work (each course participant is expected to show that he or she is able to apply the research skills learned in this course)  Examination (case study in which each course participant is expected to demonstrate his or her indepth understanding of research methodology and apply the knowledge acquired in the course to a real-life situation) The essence of knowledge is having it to apply it - Confucius
  6. 6. Important Information for Course Participants – (1) 6  You MUST read the course literature from the beginning of the semester. Relying on the PowerPoint slides is NOT sufficient! The purpose of these slides is to provide you with a broad and general introduction to research methodology. Kindly note that the slides are intended as a supplement to, and NOT as a substitute for the prescribed course literature  The prescribed course literature will be used as a reference for the quizzes, sessionals and final examination. Failure to read and understand the course literature could mean that a course participant will fail the course! An automatic passing grade in this course is NOT guaranteed, rather, a course participant‘s marks will reflect his or her effort and performance in the subject
  7. 7. 7  The project work to be undertaken in this course will be chosen by the course instructor and must be undertaken by the course participant according to the project guidelines which will be distributed in paper form seperately. It is essential that primary data is collected, analysed, evaluated and recorded by the course participant in his or her project report. Plagiarism will NOT be tolerated! If caught, zero marks will be given  The course lectures, discussions etc. will be conducted exclusively in english! The use of Urdu language in this course is strongly discouraged  Specific questions on the subject of research methodology may be asked from candidates in the Viva oral examination at the end of their MBA programme. Failure to answer these questions will definitely result in a deduction of examination marks Important Information for Course Participants – (2)
  8. 8. Course Highlights 8  Introduction to research methodology  Research Terminology and the Scientific Method  Designing and implementing a research project  Ethics in Research  Types of Research  Measurements in Research • Primary and Secondary Data • Analyzing primary and secondary data (quantitative techniques) • Communicating Research Results • Undertaking Research Project by the course participants
  9. 9. Use of Multimedia Visual Aids in this Course 9 All MS PowerPoint course presentation slides, the course outline, quizzes, the two sessionals and final examination (after completion ) supporting☺ eDocument files and the course participants’ project reports will be uploaded to the yahoo webgroup CIIT – Research Methodology, from where they will be accessible via Internet to all course participants and any other scholars or persons in Pakistan or overseas who are interested in this CIIT – Research Methodology course
  10. 10. What is Business Research? 10 Business Research may be defined as the “systematic and objective process of gathering, recording and analyzing data for aid in making business decisions” (Zikmund, Business Research Methods, 2002, p. 6) Systematicness and Objectivity are its distinguishing features of Business Research, which is important tool for managers and decision-makers in corporate and non- corporate organizations
  11. 11. When is Business Research Used? 11 Typically, business research methods are used in situations of uncertainty, that is, when decision- makers face two or more courses of action and seek to select the best possible alternative under the circumstances. Business Research is hence aimed at improving the quality of decision- making which, in turn, benefits the organization and helps ensure its continuity and efficiency
  12. 12. Business Research 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.
  13. 13. Information Reduces Uncertainty I don’t know if we should offer on-site child care?
  14. 14. Typical Users of Business Research Methods 14 Businesses and Corporations Public-Sector Agencies Consulting Firms Research Institutes Non-Governmental Organizations Non-Profit Organizations Independent Researchers and Consultants
  15. 15. “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
  16. 16. Common Business Research Methods & Techniques 16 Surveys Interviews Observation Experiments Archival and Historical Data Qualitative Analysis Quantitative Analysis
  17. 17. Fields Where Business Research is Often Used – (1) 17 General Business Conditions and Corporate Research  Short- & Long-Range Forecasting,  Business and Industry Trends  Global Environments  Inflation and Pricing  Plant and Warehouse Location  Acquisitions Financial and Accounting Research  Forecasts of financial interest rate trends,  Stock,bond and commodity value predictions  capital formation alternatives  mergers and acquisitions  risk-return trade-offs  portfolio analysis  impact of taxes  research on financial institutions  expected rate of return  capital asset pricing models  credit risk  cost analysis Management and Organizational Behaviour Research • Total Quality Management • Morale and Job Satisfaction • Leadership Style • Employee Productivity • Organizational Effectiveness • Structural ssues • Absenteeism and turnover • Organizational Climate
  18. 18. Fields Where Business Research is Often Used – (2) 18 Sales and Marketing Research  Market Potentials  Market Share  Market segmentation  Market characteristics  Sales Analysis  Establishment of sales quotas  Distribution channels  New product concepts  Test markets  Advertising research  Buyer behaviour  Customer satisfaction  Website visitation rates Information Systems Research  Knowledge and information needs assessment  Computer information system use and evaluation  Technical suppot satisfaction  Database analysis  Data mining  Enterprise resource planning systems  Customer relationship management systems Corporate Responsibility Research  Ecological Impact  Legal Constraints on advertising and promotion  Sex, age and racial discrimination / worker equity  Social values and ethics
  19. 19. Selected Examples of Real-Life Situations in Which Business Research Methods are Used 19  A firm wants to produce and market a new product but first wants to ascertain if there is a potential consumer demand for this product in markets x,y and z  a multinational firm wants to establish a production facility in another country after determining its technical and economic feasibility  A government agency wants to ascertain the satisfaction level of its employees, the causes for any possible discontent, and propose a scheme for enhancing this level  A financial institution wants to invest in commodities and commissions a study to determine the past trends and forecast future returns in a portfolio of commodities  The CEO of a firm wants to undertake a SWOT-Analysis as part of his plan to redefine his organization’s priorities
  20. 20. Basic research Applied research Business Research Types
  21. 21. Basic Research Attempts to expand the limits of knowledge. Not directly involved in the solution to a pragmatic problem.
  22. 22. Basic Research Example 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? Do consumers experience cognitive dissonance in low-involvement situations?
  23. 23. "The secret of success is to know something nobody else knows. " Aristotle Onassis
  24. 24. Applied Research Conducted when a decision must be made about a specific real-life problem
  25. 25. Applied Research Examples Should McDonalds add Italian pasta dinners to its menu? Business research told McDonald’s it should not? Should Procter & Gamble add a high-priced home teeth bleaching kit to its product line? Research showed Crest Whitestrips would sell well at a retail price of $44
  26. 26. Basic and Applied Research 26 Basic Research aims to expand the frontiers of science and knowledge by verifying or disproving the acceptability of a given theory or attempting to discover more about a certain concept (non-specificity) Example: How does motivation affect employee performance? Applied Research focusses on a real-life problem or situation with a view to helping reach a decision how to deal with it (Specificity) Example: Should Corporation X adopt a paperless office environment?
  27. 27. Science and the Scientific Method 27 Science has been defined as “the methodological and systematic approach to acquisition of new knowledge” (Geoffrey Marcyzk, David DeMatteo, David Festinger, Essentials of Research Design and Methodology, John Wiley & Sons, 2005, p. 4) The scientific method, which has evolved since the 13th century, concerns the set of tools, techniques and procedures used by basic and applied researchers to analyze and understand phenomena and prove or disprove prior conceptions
  28. 28. The Essence of the Scientific Method 28 Characteristics of the Scientific Method Objectivity Systematic Analysis Logical Interpretation of Results Elements of the Scientific Method Empirical Approach Observations Questions Hypotheses Experiments Analysis Conclusion Replication Basic Research Applied Research Scientific Method Information or Ideas for alternative Courses of action General Laws
  29. 29. Scientific Method The analysis and interpretation of empirical evidence (facts from observation or experimentation) to confirm or disprove prior conceptions.
  30. 30. The Decision-making Process Associated with the Development and Implementation of a Strategy Identifying problems and opportunities Diagnosis and assessment Selecting and implementing a course of action Evaluating the course of action
  31. 31. Evaluation Research Evaluation research is the formal, objective measurement and appraisal of the extent to which a given activity, project, or program has achieved its objectives.
  32. 32. Performance-monitoring Research Research that regularly provides feedback for evaluation and control Indicates things are or are not going as planned Research may be required to explain why something “went wrong”
  33. 33. Total Quality Management (TQM) A business philosophy that embodies the belief that the management process must focus on integrating customer-driven quality throughout the organization.
  34. 34. TQM Stresses continuous improvement of product quality and service. Managers improve durability and enhance features as the product ages. Managers strive to improve delivery and other services to keep their companies competitive
  35. 35. The Value of Business Research for Managers – (1) 35 Reduction of uncertainty and improvement in the quality of decision-making with several consequent advantages (e.g. strategic, operational) and benefits for organizations Business Research Methods can be employed in each of the following four stages: (1) Identification of problems and/or opportunities Useful for strategy planning, analysis of internal and external organizational environment
  36. 36. The Value of Business Research for Managers – (2) 36 (2) Diagnosing and Assessment of problems and/or opportunities Its purpose is to gain insight into the underlying reasons and causes for the situation. If there is a problem, it asks what happened and why? If there is an opportunity, it seeks to explore, clarify and refine the nature of the opportunity and, in the case of multiple opportunities, seeks to set priorities (3) Selection and Implementation of Courses of Action After alternative courses of action have been determined, selection of the best possible course.
  37. 37. The Value of Business Research for Managers – (3) 37 An important consideration is the quality of forecasting which is an essential tool of research (4) Evaluating the Course of Action Business Research Methods are used after a course of action has been implemented in order to determine whether activities have been properly implemented and have accomplished what they intended to do
  38. 38. The Value of Business Research for Managers – (4) 38 Evaluation Research – It is the formal objective measurement and evaluation of the extent which an activity, project or programme has achieved its goal, and the factors which influence performance (e.g. audits). It is also the formal objective measurement and evaluation of the extent to which on-going activities, projects or programmes are meeting their goals (performance- monitoring research) Examples of performance-monitoring research: (1) Are railway passengers satisfied with the level of service the railway company is providing? If not, then research may need to be undertaken to ascertain the reasons for customer dissatisfaction and propose corrective measures
  39. 39. The Value of Business Research for Managers – (5) 39 (2) What are the trends in retail and wholesale sector? Can research suggest new ways to improve efficiency in purchase transactions?
  40. 40. Is sufficient time available before a managerial decision must be made? Is the information already on hand inadequate for making the decision? Is the decision of considerable strategic or tactical importance? Does the Value of the research information exceed the cost of conducting research? Conduct Business Research Do Not Conduct Business Research Time Constraints Availability of Data Nature of the Decision Benefits vs. Costs Yes YesYesYes No When to Conduct Business Research No No No
  41. 41. Value versus Costs Potential Value of a Business Research Effort Should Exceed Its Estimated Costs
  42. 42. Value •Decreased certainty •Increased likelihood of a correct decision •Improved business performance and resulting higher profits •Higher Profits •Better Reputation Costs COST •Research expenditures •Delay of business decision •Possible disclosure of information to rivals •Possible erroneous research results Value Should Exceed Estimated Costs
  43. 43. 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
  44. 44. Cross-functional Teams Cross-functional teams are composed of individuals from various organizational departments such as engineering, production, finance, and marketing who share a common purpose.
  45. 45. The Building Blocks of Research 45 Measurements of phenomena (e.g. sales statistics of a department store) Determination of relationship amongst data with a view to facilitating understanding of the phenomena, their relationships and decision-making (e.g. past and predicted future sales trends) Blend of information, experience and in-sights That provides a framework that can be thoughtfully evaluated when assessing new information or evaluating relevant situations KNOWLEDGE INFORMATION DATA
  46. 46. Demands on Data & Information 46  Relevance to the problem or situation at hand  Must be available in a timely manner to the right person (manager or decision-maker)  Completeness  Accuracy  Accessibility  Affordability  Integrateability into a broader global information or decision-support system
  47. 47. Business Research in the International Context 47 Business Research is being increasingly applied in an international context in the wake of globalization and the consequent freedom of movement of the resources of labour, capital and information of businesses and corporations:  Overseas market potential & Market knowledge is essential  Joint ventures and relocating production lines overseas  Framework considerations for investment and trade (e.g. culture, legal environment, security, physical infrastructure, availability and quality of human resources, logistics, political stability, trade and investment incentives)  A.C. Nielsen - more that 67% international business
  48. 48. Global Business Research General information about country - economic conditions and political climate Cultural and consumer factors Market and competitive conditions - demand estimation
  49. 49. The Internet Is Transforming Society Time is collapsing. Distance is no longer an obstacle. Crossing oceans is only a mouse click away. People are connected 24 hours a day, seven days a week. "Instantaneous" has a new meaning.
  50. 50. Internet Research Seeking facts and figures about an issue Surveys on Web sites
  51. 51. Global Information Support Systems 51 A Global Information System may be defined as “ an organized collection of computer hardware, communication equipment, software, data, and personnel designed to capture, store, update, manipulate, analyze, and immediately display information about worldwide business activities” A Global Information System is a tool for providing past, current and projected information on internal operations and external activity. It organizes and integrates data from production, operations, marketing, finance, accounting and other business functions (Zikmund, p. 22)
  52. 52. Decision-Support System 52 A computer-based system that helps decision makers confront problems through direct interaction with databases and analytical software programs The purpose of a decision support system is to store data and transform them into organized information that is easily accessible to decision-makers Decision-Support Systems are integrated in Global Information Systems. They are aimed usually for assisting managers and decision-makers in specific organizational business units (e.g. divisions, departments and functional areas) by providing organized and adaptable information
  53. 53. Databases & Software 53 Databases are collections of raw data which have been arranged in a logical manner and which can be stored and processed electronically Software are programmes that allow complex operations to be undertaken on data and which give information for managers and decision-makers Data Warehousing & Data Mining
  54. 54. Data and Information Sources for Business Researchers – (1) 54  Internal Records Example: Data about costs, shipments, inventory, sales, and other aspects of regular operations which are collected from various functional areas of an organization  Proprietary Business Research Example: New data and information from projects which are undertaken ad hoc to study specific company problems  Business intelligence Systems Example: Information about nonrecurring developments in the external business environment stemming from a network of sources and regular procedures
  55. 55. Data and Information Sources for Business Researchers – (2) 55  On-Line Databases Examples: PROQUEST, INFOTRAC, DIALOG, LEXIS-NEXIS, Dow Jones News Retrieval Services, CompuStat  Internet Examples: World Wide Web search engines (Google, Yahoo, Altavista, Lycos, Excite etc.)  All Other Sources Examples: Research Institutions, Libraries, Books, Journals, Periodicals, Newspapers, Chambers of Commerce and Industry
  56. 56. Business Research in the 21st Century Increased globalization Growth of the Internet and other information technologies
  57. 57. Data and Information Sources for Business Researchers (Pakistan) 57  Federal and provincial ministries of commerce, industries and production  Federal, provincial and city Chambers of Commerce and Industry  State Bank of Pakistan, Pakistan Banking Council, local and foreign banking institutions  Stock Exchanges  National Investment Board  Export Promotion Bureau  Manufacturers, Traders and Exporters Associations  Research Institutes (e.g. Pakistan Institute of Development Economics)  Newspapers and Magazines (e.g. Business Recorder, Pakistan and Gulf Economist)  Business and Trade Directories  Internet (e.g.:
  58. 58. Business Recorder ( 58