Course Code: CP-206 Author: Dr. B.S.

Bodla
Subject: Research Methodology Vetter: Prof. M.S. Turan
Lesson No.: 1

INTRODUCTION TO RESEARCH METHODOLOGY

STRUCTURE
1.0 Objective
1.1 Introduction
1.2 Scope of Business Research
1.3 Business Research Defined
1.4 Basic Research and Applied Research
1.5 Managerial Value of Business Research
1.6 When is Business Research Needed?
1.7 Major Topics for Research in Business
1.8 Internal Versus External Consultants/Researchers
1.9 Business Research in a Global Activity
1.10 Research Method versus Methodology
1.11 Ethics and Business Research
1.12 Summary
1.13 Keywords
1.14 Self Assessment Questions
1.15 References/Suggested Readings

1.0 OBJECTIVES

After reading this lesson you should be able to-

• Describe what research is and how is it defined;
• Distinguish between applied and basic research;
• Explain why managers should know about research;
• Discuss what managers should and should not do in order to
interact most effectively with researchers;
 • Discuss what research means to you and describe how you,
as manager, might apply the knowledge gained about
research; and
• Discuss advantages and disadvantages of internal and
external researchers.

1.1 INTRODUCTION

Just close your eyes for a minute and utter the word research to
yourself. What kinds of images does this word conjure up for you? Do
you visualize a lab with scientists at work Bunsen burners and test
tubes, or an Einstein-like character writing dissertations on some
complex subject, or someone collecting data to study the impact of a
newly introduced day-care system on the morale of employees? Most
certainly, all these image do represent different aspects of research.
Research is simply the process of finding solutions to a problem after a
thorough study and analysis of the situational factors. Managers in
organizations constantly engage themselves in studying and analyzing
issues and hence are involved in some form of research activity as they
make decisions at the workplace. As is well known, sometimes managers
make good decisions and the problem gets solved, sometimes they make
poor decisions and the problem persists, and on occasions they make
such colossal blunders that the organization gets stuck in the mire. The
difference between making good decision and committing blunders lies in
how managers go about the decision-making process. In other words,
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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This is the essence of research and to be a successful manager it is
important for you to know how to go about making the right decisions by
being knowledgeable about the various steps involved in finding solutions
to problematic issues. This is what this book is all about.

1.2 SCOPE OF BUSINESS RESEARCH

The scope of business research is limited by one’s definition of

“business”. Certainly research in the production, finance, marketing, or
management areas of a for-profit corporation is within the scope of
business research. A broader definition of business, however, includes
not-for-profit organizations, such as the American Heart Association, the
Sac Diego Zoo, and the Boston Pops Orchestra, Each of these
organizations exists to satisfy social needs, and they require business
skills to produce and distribute the services that people want. Business
research may be conducted by organizations that are not business
organizations. The reserve bank of India, for example, performs many
functions that are similar, if not identical, to those of business
organizations. Reserve bank economists may use research techniques for
evaluative purposes much the same way as managers at Reliance or
Ford. The term business research is utilized because all its techniques
are applicable to business settings.

Business research covers a wide range of phenomena. For

managers the purpose of research is to fulfill their need for knowledge of
the organization, the market, the economy, or another area of
uncertainty. A financial manager may ask, “Will the environment for
long-term financing be better two years from now?” A personnel manager
may ask, “What kind of training is necessary for production employees?”
or “What is the reason for the company’s high turnover?” A marketing
manager may ask, “How can I monitor my sales in retail trade activities?”

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1.3 BUSINESS RESEARCH DEFINED

The task of business research is to generate accurate information

for use in decision making as we say above, the emphasis of business
research is on shifting decision makers from intuitive information
gathering to systematic and objective investigation. Business research is
defined as the systematic and objective process of gathering, recording,
and analyzing data for aid in making business decisions.

This definition suggests, first, that research information is neither

intuitive nor haphazardly gathered. Literally, research (re-search) means
to “search again”. It connotes patient study and scientific investigation
wherein the researcher takes another, more careful look at data to
discover all that can be known about the subject of study.

Second, if the information generated or data collected and analyzed

are to be accurate, the business researcher must be objective. The need
for objectivity was cleverly stated by the nineteenth-century American
humorist Artemus Ward, who said, “It ain’t the things we don’t know that
gets us in trouble. It’s the things we know that ain’t so”. Thus the role of
the researcher is to be detached and impersonal, rather than biased in
an attempt to prove preconceived ideas. If bias enters the research
process, the value of the data is considerably reduced.

A developer who owned a large area of land on which he wished to

build a high-prestige shopping center wanted a research report to
demonstrate to prospective retailers that there was a large market
potential for such a center. Because he conducted his survey exclusively
in an elite neighbourhood, not surprisingly his findings showed that a
large percentage of respondents wanted a “high-prestige” shopping
center. Results of this kind are misleading, of course, and should be
disregarded. If the user of such findings discovers how they were
obtained, the developer loses credibility. If the user is ignorant of the bias

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in the design and unaware that the researchers were not impartial, his
decision may have consequences more adverse than if he had made it
strictly on intuition. The importance of objectivity cannot be
overemphasized. Without objectivity, research is valueless.

Third, the above definition of business research points out that its
objective is to facilitate the managerial decision process for all aspects of
business: finance, marketing, personnel, The definition is not problem-
solving and decision-making activities, business research generates and
provides the necessary information upon which to base decisions. By
reducing the uncertainty of decisions, it reduces the risk of making
wrong decisions. However, research should be an aid to managerial
judgement, not a substitute for it. There is more to management than
research. Applying research remains a managerial art.

1.4 BASIC RESEARCH AND APPLIED RESEARCH

One reason for conducting research is to develop and evaluate

concepts and theories. Basic- or pure-research attempts to expand the
limits of knowledge. It does not directly involve the solution to a
particular, pragmatic problem, but it had been said, “There is nothing so
practical as a good theory.” Although this statement is true in the long
run, basic research findings generally cannot be immediately
implemented. Basic research is conducted to verify the acceptability of a
given theory or to know more about a certain concept.

For example, consider this basic research conducted by a

university. Academic researchers investigated whether or not an
individual’s perception that he or she was doing well on a task would
have any influence on future performance. Two nearly identical groups of
adults were given ten puzzles to solve. All of the individuals had identical
sets of puzzles to solve. After the subjects had given their solutions to the
researchers, they were told “how well” they did on the test. All of the

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persons in the first group were told that they had done well (70 percent
correct regardless of the actual percent correct. The members of the other
group were told that they had done poorly (30 percent correct). Then both
groups were given another set of ten puzzles. The group that had been
told they had done well on the first set of puzzles performed better with
the second set of puzzles than did the group that had been told they had
been relatively unsuccessful with the first puzzle solving. The results of
this basic research expand scientific knowledge about theories of general
performance behaviour. This study was conducted because the
researchers thought the theory being tested was far-reaching and
applicable to a broad range of situations and circumstances.

Applied research is conducted when a decision must be made

about a specific real-life problem. Applied research encompasses those
studies undertaken to answer questions about specific problems or to
make decisions about a particular course of action or policy. For
example, an organization contemplating a paperless office and a
networking system for the company’s personal computers may conduct
research to learn the amount of time its employees spend at personal
computer in an average week.

The procedures and techniques utilized by basic and applied

researchers do not differ substantially. Both employ the scientific method
to answer the questions at hand. Broadly characterized, the scientific
method refers to techniques and procedures that help the researcher to
know and understand business phenomena. The scientific method
requires systematic analysis and logical interpretation of empirical
evidence (facts from observation or experimentation) to confirm or
disprove prior conceptions. In basic research, first testing these prior
conceptions or hypotheses and then making inferences and conclusions
about the phenomena leads to the establishment of general laws about
the phenomena.

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 Use of the scientific method in applied research assures objectivity
in gathering facts and testing creative ideas for alternative business
strategies. The essence of research, whether basic or applied, lies in the
scientific method, and much of this book deals with scientific
methodology. The difference in the techniques of basic and applied
research is largely a matter of degree rather than substance.

1.5 MANAGERIAL VALUE OF BUSINESS RESEARCH

We have argued that research facilitates effective management. At

the Ford Motor Company a marketing manager stated, “Research is
fundamental to everything we do, so much so that we hardly make any
significant decision without the benefit of some kind of market research.
The risks are too big.” Managers in other functional areas have similar
beliefs about research in their specialties.

The prime managerial value of business research is that it reduces

uncertainty by providing information that improves the decision-making
process. The decision making process associated with the development
and implementation of a strategy involves three interrelated stages.
1. Identifying problems or opportunities
2. Selecting and implementing a course of action
3. Evaluating the course of action

Business research, by supplying managers with pertinent

information, may play an important role by reducing managerial
uncertainty in each of these stages.

Identifying Problems or Opportunities

Before any strategy can be developed, an organization must

determine where it wants to go and how it will get there. Business
research can help managers plan strategies by determining the nature of

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situations by identifying the existence of problems or opportunities
present in the organization.

Business research may be used as a diagnostic activity to provide

information about what is occurring within an organization or in its
environment. The mere description of some social or economic activity
may familiarize managers with organizational and environmental
occurrences and help them understand a situation. For example, the
description of the dividend history of stocks in an industry may point to
an attractive investment opportunity.

Information supplied by business research may also indicate

problems. For example, employee interviews undertaken to delineate the
dimensions of an airline reservation clerk’s job may reveal that
reservation clerks emphasize competence in issuing tickets over courtesy
and friendliness in customer contact. Once business research indicates a
problem, managers may feel that the alternatives are clear enough to
make a decision based on experience or intuition, or they may decide
that more business research is needed to generate additional information
for a better understanding of the situation.

Whether an organization recognizes a problem or gains insight into

a potential opportunity, an important aspect of business research is its
provision of information that identifies or clarifies alternative courses of
action.

Selecting and implementing a course of action

After the alternative courses of action have been identified,

business research is often conducted to obtain specific information that
will aid in evaluating the alternatives and in selecting the best course of
action. For example, suppose a facsimile (fax) machine manufacturer
must decide to build a factory either in Japan or in Sough Korea. In such

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a case, business research can be designed to supply the exact
information necessary to determine which course of action is best of the
organization.

Opportunities may be evaluated through the use of various

performance criteria. For example, estimates of market potential allow
managers to evaluate the revenue that will be generated by each of the
possible opportunities. A good forecast supplied by business researchers
is among the most useful pieces of planning information a manager can
have. Of course, complete accuracy in forecasting the future is not
possible because change is constantly occurring in the business
environment. Nevertheless, objective information generated by business
research to forecast environmental occurrences may be the foundation
for selecting a particular course of action.

Clearly, the best plan is likely to result in failure if it is not properly

implemented. Business research may be conducted with the people who
will be affected by a pending decision to indicate the specific tactics
required to implement that course of action.

Evaluating course of action

After a course of action has been implemented, business research

may serve as a tool to inform managers whether planned activities were
properly executed and whether they accomplished what they were
expected to accomplish. In other words, business research may be
conducted to provide feedback for evaluation and control of strategies
and tactics.

Evaluation research is the formal, objective measurement and

appraisal of the extent to which a given action, activity, or program has
achieved its objectives. In addition to measuring the extent to which
completed programs achieved their objectives or to which continuing

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programs are presently performing as projected, evaluation research may
provide information about the major factor influencing the observed
performance levels.

In addition to business organization, nonprofit organization, such

as agencies of the federal government, frequently conduct evaluation
research. It is estimated that every year more than, 1,000 federal
evaluation studies are undertaken to systematically assess the effects of
public programs. For example, the General Accounting Office has been
responsible for measuring outcomes of the Employment Opportunity Act,
the Head Start program, and the Job Corps program.

Performance-monitoring research is a term used to describe a

specific type of evaluation research that regularly, perhaps, routinely,
provides feedback for the evaluation and control of recurring business
activity. For example, most firms continuously monitor wholesale and
retail activity to ensure early detection of sales declines and other
anomalies. In the grocery and retail drug industries, sales research may
use the universal product code (UPC) for packages, together with
computerized cash registers and electronic scanners at checkout
counters, to provide valuable market share information to store and
brand managers interested in the retail sales volume of specific product.

United Airlines’ Omnibus in-flight surveys provide a good example

of performance monitoring research. United routinely selects sample
flights and administers questionnaire about in-flight service, food and
other aspects of air travel. The Omnibus survey is conducted quarterly to
determine who is flying and for what reasons. It enables United to track
demographic changes and to monitor customer ratings of its services on
a continuing basis, allowing the airline to gather vast amounts of
information at low cost. The information relating to customer reaction to
services can be compared over time. For example, suppose United

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decided to change its menu for in-flight meals. The results of the
Omnibus survey might indicate that shortly after the menu changed, the
customers’ rating of the airline’s food declined. Such information would
be extremely valuable, as it would allow management to quickly spot
similar trends among passengers in other aspects of air travel, such as
airport lounges, gate-line waits, or cabin cleanliness, Thus managerial
action to remedy problems could be rapidly taken.

When analysis of performance indicated that all is not going as

planned, business research may be required to explain why something
“went wrong.” Detailed information about specific mistakes or failures is
frequently sought. If a general problem area is identified, breaking down
industry sales volume and a firm’s sales volume into different geographic
areas may provide an explanation of specific problems, and exploring
these problems in greater depth may indicate which managerial
judgments were erroneous.

1.6 WHEN IS BUSINESS RESEARCH NEEDED?

A manager faced with two or more possible courses of action faces

the initial decision of whether or not research should be conducted. The
determination of the need for research centers on (1) time constraints, (2)
the availability of data, (3) the nature of the decision that must be made,
and (4) the value of the business research information in relation to its
costs.

Time constraints

Systematically conducting research takes time. In many instances

management concludes that because a decision must be made
immediately, there will be no time for research. As a consequence,
decisions are sometimes made without adequate information or thorough

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understanding of the situation. Although not ideal, sometimes the
urgency of a situation precludes the use of research.

Availability of data

Frequently managers already possess enough information to make

a sound decision without business research. When there is an absence of
adequate information, however, research must be considered. Managers
must ask themselves, “Will the research provide the information needed
to answer the basic questions about this decision?” If the data cannot be
made available, research cannot be conducted. For example, prior to
1980 the people’s republic of China had never conducted a population
census. Organizations engaged in international business often find that
data about business activity or population characteristics, found in
abundance when investigating the United States, are nonexistent or
sparse when the geographic area of interest is an underdeveloped
country. Further, if a potential source of data exists, managers will want
to know how much it costs to obtain those data.

Nature of the decision

The value of business research will depend on the nature of the

managerial decision to be made. A routine tactical decision that does not
require a substantial investment may not seem to warrant a substantial
expenditure for business research. For example, a computer software
company must update its operator’s instruction manual when minor
product modifications are made. The cost of determining the proper
wording for the updated manual is likely to be too high for such a minor
decision. The nature of such a decision is not totally independent from
the next issue to be considered: the benefits versus the costs of the
research. However, in general the more strategically or tactically
important the decision, the more likely that research will be conducted.

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Benefits versus costs

Some of the managerial benefits of business research have already

been discussed. Of course, conducting research activities to obtain these
benefits requires an expenditure; thus there are both costs and benefits
in conducting business research. In any decision-making situation,
managers must identify alternative courses of action, then weigh the
value of each alternative against its cost. It is useful to think of business
research as an investment alternative. When deciding whether to make a
decision without research or to postpone the decision in order to conduct
research, managers should ask: (1) Will the payoff or rate of return be
worth the investment? (2) Will the information gained by business
research improve the quality of the decision to an extent sufficient to
warrant the expenditure? And (3) Is the proposed research expenditure
the best use of the available funds?

For example, TV Cable Week was not test-marketed before its

launch. While the magazine had articles and stories about television
personalities and events, its main feature was a channel-by-channel
program listing showing the exact programs that a particular subscriber
could receive. To produce a “custom” magazine for each individual cable
television system in the country required developing a costly computer
system. Because development required a substantial expenditure, one
that could not be scaled down for research, the conducting of research
was judged to be an improper investment. The value of the research
information was not positive, because the cost of the information
exceeded its benefits. Unfortunately, pricing and distribution problems
became so compelling after the magazine was launched that it was a
business failure. Nevertheless, the publication’s managers, without the
luxury of hindsight, made a reasonable decision not to conduct research.
They analyzed the cost of the information (i.e. the cost of business
research) relative to the potential benefits.

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1.7 MAJOR TOPICS FOR RESEARCH IN BUSINESS

Research is expected to improve the quality of business decisions,

but what business-decision topics benefit from research efforts? Exhibit
1.1 lists several major topics for research in business.

EXHIBIT 1.1: MAJOR TOPICS FOR RESEARCH IN BUSINESS

• General Business, Economic, and corporate Research

• Short-range forecasting (up to one year)
• Long-range forecasting (over one year)
• Studies of business and industry trends
• Inflation and pricing studies
• Plant and warehouse location studies
• Acquisition studies
• Export and international studies
• Financial and Accounting Research
• Forecasts of financial interest-rate trends
• Stock, bond, and commodity value predictions
• Capital formation alternatives
• Research related to mergers and acquisitions
• Risk-return trade off studies
• Impact of taxes
• Portfolio analysis
• Research on financial institutions
• Expected-rate-of-return studies
• Capital asset pricing models
• Credit risk management in corporates
• Cost analysis
• Management and Organizational Behavior Research
• Total quality management
• Morale and job satisfaction

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• Leadership styles and their effectiveness
• Employee productivity
• Organizational effectiveness
• Structural studies
• Absenteeism and turnover
• Organizational communication
• Time and motion studies
• Physical environment studies
• Labor union trends
• Sales and Marketing Research
• Measurement of market potentials
• Market-share analysis
• Market segmentation studies
• Determination of market characteristics
• Sales analysis
• Establishment of sales quotas, territories
• Distribution-channel studies
• New-product concept tests
• Test-market studies
• Advertising research Buyer-behavior/consumer satisfaction
studies
• Corporate Responsibility Research
• Ecological impact studies
• Legal constraints on advertising and promotion studies
• Sex, age, and racial discrimination worker-equity studies
• Social values and ethics studies.

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1.8 INTERNAL VERSUS EXTERNAL CONSULTANTS/RESEARCHERS

Internal Consultants/Researchers

Some organizations have their own consulting or research

department, which might be called the Management Services
Department, the Organization and Methods Department, R & D (research
and development department), or by some other name. This department
serves as the internal consultant to subunits of the organization that face
certain problems and seek help. Such a unit within the organization, if it
exists, would be useful in several ways, and enlisting its help might be
advantageous under some circumstances, but not in others. The
manager often has to decide whether to use internal or external
researchers. To reach a decision, the manager should be aware of the
strengths and weaknesses of both, and weigh the advantages and
disadvantages of using either, based on the needs of the situation. Some
of the advantages and disadvantages of both the internal and external
teams are now discussed.

Advantages of Internal Consultants/Researchers

There are at least four advantages in engaging an internal team to

do the research project:
1. The internal team would stand a better chance of being
readily accepted by the employees in the subunit of the
organization where research needs to be done.
2. The team would require much less time to understand the
structure, the philosophy and climate, and the functioning
and work systems of the organization.
3. They would be available for implementing their
recommendations after the research findings are accepted.
This is very important because any “bugs” in the
implementation of the recommendations could be removed

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 with their help. They would also be available for evaluating
the effectiveness of the changes, and considering further
changes if and when necessary.
4. The internal team might cost considerably less than an
external team for the department enlisting help in problem
solving, because they will need less time to understand the
system due to their continuous involvement with various
units of the organization. For problems that are of low
complexity, the internal team would be ideal.

Disadvantages of internal Consultants/Researchers

There are also certain disadvantages to engaging internal research

teams for purposes of problem solving. The four most critical ones are:
1. In view of their long tenure as internal consultants, the
internal team may quite possibly fall into a stereotyped way
of looking at the organization and its problems. This would
inhibit any fresh ideas and perspectives that might be
needed to correct the problem. This would definitely be a
handicap for situations in which weighty issues and complex
problems are to be investigated.
2. There is scope for certain powerful coalitions in the
organization to influence the internal team to conceal,
distort, or misrepresent certain facts. In other words, certain
vested interests could dominate, especially in securing a
sizable portion of the available scant resources.
3. There is also a possibility that even the most highly qualified
internal research teams are not perceived as “experts” by the
staff and management, and hence their recommendations do
not get the consideration and attention they deserve.

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 4. Certain organizational biases of the internal research team
might in some instances make the finding less objective and
consequently less scientific.

External Consultants/Researchers

The disadvantages of the internal research teams turn out to be the

advantage of the external teams, and the former’s advantages work out to
be the disadvantages of the latter. However, the specific advantages and
disadvantages of the external teams may be highlighted.

Advantages of External Consultants

The advantages of the external team are:

1. The external team can draw on a wealth of experience from

having worked with different types of organizations that have had the
same of similar types of problems. This wide range of experience would
enable them to think both divergently and convergently rather than hurry
to an instant solution on the basis of the apparent facts in the situation.
They would be able to ponder over several alternative ways of looking at
the problem because of their extensive problem-solving experiences in
various other organizational setups. Having viewed the situation from
several possible angles and perspective (divergently), they could critically
assess each of these, discard the less viable option and alternatives, and
focus on specific feasible solutions (think convergently).
2. The external teams, especially those from established
research and consulting firms, might have more knowledge
of current sophisticated problem-solving models through
their periodic training programs, which the teams within the
organization may not have access to. Because knowledge
obsolescence is a real threat in the consulting area, external
research institutions ensure that their members are current

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 on the latest innovations through periodic organized training
programs. The extent to which internal team members are
kept abreast of the latest problem-solving techniques may
vary considerably from one organization to another.

Disadvantages of external consultants

The major disadvantages in hiring an external research team are as

follows:
1. The cost of hiring an external research team is usually high
and is the main deterrent, unless the problems are very
critical.
2. In addition to the considerable time the external team takes
to understand the organization to be researched, they seldom
get a warm welcome, nor are readily accepted by employees.
Departments and individuals likely to be affected by the
research study may perceive the study team as a threat and
resist them. Therefore, soliciting employees’ help and
enlisting their cooperation in the study is a little more
difficult and time-consuming for the external researchers
than for the internal teams.
3. The external team also charges additional fees for their
assistance in the implementation and evaluation phases.

Keeping in mind these advantages and disadvantages of the

internal and external research teams, the manager who desires research
services has to weigh the pros and cons of engaging either before making
a decision. If the problem is a complex one, or if there are likely to be
vested interests, or if the very existence of the organization is at stake
because of one or more serious problems, it would be advisable to engage
external researchers despite the increased costs involved. However, if the
problems that arise are fairly simple, if time is of the essence in solving

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moderately complex problems, or if there is a system wise need to
establish procedures and policies of a fairly routine nature, the internal
team would probably be the better option.

Knowledge of research methods and appreciation of the

comparative advantages and disadvantages of the external and internal
teams help managers to make decisions on how to approach problems
and determine whether internal or external researchers will be the
appropriate choice to investigate and solve the problem.

1.9 BUSINESS RESEARCH IN A GLOBAL ACTIVITY

Business today operates globally. Business research, like all

business activity, has become increasingly global. Some companies have
extensive international business research operations. Upjohn conducts
business research in 160 different countries.

Companies that conduct business in foreign lands must

understand the particular nature of those markets and determine
whether they require customized business strategies. For example,
although the 14 nations of the European Community not share a single
market, business research shows that they do not share identical tastes
for many consumer products. Business researchers have learned that
there is no such thing as a typical European consumer or worker; the
nations of the European Community are divided by language, religion,
climate, and centuries of tradition. For example, Scantel Research, a
British firm that advises companies on color preferences, found
inexplicable differences in the way Europeans take their medicine. The
French prefer to pop purple pills, while the English and Dutch wish for
white ones. Consumers in all three countries dislike bright red capsules,
which are big sellers in the United States. This example illustrates that
companies that do business in Europe must learn whether they need to
adapt to local customs and habits.

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 A.C. Nielsen, the company that does television ratings, is the
world’s largest business research company. More than 60 percent of its
business comes from outside the United States. Although the nature of
business research can change around the globe, the need for business
research is universal. Throughout this book we will discuss the practical
problems involved in conducting business research in Europe, Asia, Latin
America, the Middle East, and elsewhere.

1.10 RESEARCH METHOD VERSUS METHODOLOGY

It seems appropriate at this juncture to explain the difference

between research methods and research methodology. Research methods
may be understood as all those methods/techniques that are used for
conduction of research. Research methods or techniques, thus, refer to
the methods the researchers use in performing research operations. In
other words, all those methods which are used by the researcher during
the course of studying his research problem are termed as research
methods. Since the object of research, particularly the applied research,
is to arrive at a solution for a given problem, the available data and the
unknown aspects of the problem have to be related to each other to make
a solution possible. Keeping this in view, research methods can be put
into the following three groups:
1. In the first group we include those methods which are
concerned with the collection of data. These methods will be
used where the data already available are not sufficient to
arrive at the required solution;
2. The second group consists of those statistical techniques
which are used for establishing relationships between the
data and the unknowns;
3. The third group consists of those methods which are used to
evaluate the accuracy of the results obtained.

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 Research methods falling in the above stated last two groups are
generally taken as the analytical tools of research.

Research methodology is a way to systematically solve the research

problem. It may be understood as a science of studying how research is
done scientifically. In it we study the various steps that are generally
adopted by a researcher in studying his research problem along with the
logic behind them. It is necessary for the researcher to know not only
research methods/techniques but also the methodology. Researchers not
only need to know how to develop certain indices or tests, how to
calculate the mean, the mode, the median or the standard deviation or
chi-square, how to apply particular research techniques, but they also
need to know which of these methods or techniques, are relevant and
which are not, and what would they mean and indicate and why.
Researchers also need to understand the assumptions underlying various
techniques and they need to know the criteria by which they can decide
that certain techniques and procedures will be applicable to certain
problems and others will not. All this means that it is necessary for the
researcher to design his methodology for his problem as the same may
differ from problem to problem. For example, an architect, who designs a
building, has to consciously evaluate the basis of his decisions, i.e., he
has to evaluate why and on what basis he selects particular size, number
and location of doors, window and ventilators, uses particular materials
and not others and the like. Similarly, in research the scientist has to
expose the research decisions to evaluation before they are implemented.
He has to specify very clearly and precisely what decisions he selects and
why he selects them so that they can be evaluated by others also.

From what has been stated above, we can say that research
methodology has many dimensions and research methods do constitute a
part of the research methodology. The scope of research methodology is
wider than that of research methods. Thus, when we talk of research

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methodology we not only talk of the research methods but also consider
the logic behind the methods we use in the context of our research study
and explain why we are using a particular method or technique and why
we are not using others so that research results are capable of being
evaluated either by the researcher himself or by others. Why a research
study has been undertaken, how the research problem has been defined,
in what way and why the hypothesis has been formulated, what data
have been collected and what particular method has been adopted, why
particular technique of analyzing data has been used and a host of
similar other questions are usually answered when we talk of research
methodology concerning a research problem or study.

Research and Scientific Method

For a clear perception of the term research, one should know the
meaning of scientific method. The two terms, research and scientific
method, are closely related. Research, as we have already stated, can be
termed as “an inquiry into the nature of, the reasons for, and the
consequences of any particular set of circumstances, whether these
circumstances are experimentally controlled or recorded just as they
occur. Further, research implies the researcher is interested in more than
particular results; he is interested in the repeatability of the results and
in their extension to more complicated and general situations.” On the
other hand, the philosophy common to all research methods and
techniques, although they may vary considerably from one science to
another, is usually given the name of scientific method. In this context,
Karl Pearson writes, “The scientific method is one and same in the
branches (of science) and that method is the method of all logically
trained minds…….the unity of all sciences consists alone in its methods,
not its material; the man who classifies facts of any kind whatever, who
sees their mutual relation and describes their sequences, is applying the
Scientific Method and is a man of science.” Scientific method is the

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pursuit of truth as determined by logical considerations. The ideal of
science is to achieve a systematic interrelation of facts. Scientific method
attempts to achieve “this ideal by experimentation, observation, logical
arguments from accepted postulates and a combination of these three in
varying proportions.” In scientific method, logic aids in formulating
propositions explicitly and accurately so that their possible alternatives
become clear. Further, logic develops the consequences of such
alternatives, and when these are compared with observable phenomena,
it becomes possible for the researcher or the scientist to state which
alternative is most in harmony with the observed facts. All this is done
through experimentation and survey investigations which constitute the
integral parts of scientific method.

Experimentation is done to test hypotheses and to discover new

relationships, if any, among variables. But the conclusions drawn on the
basis of experimental data are generally criticized for either faulty
assumptions, poorly designed experiments, badly executed experiments
or faulty interpretations. As such the researcher must pay all possible
attention while developing the experimental design and must state only
probable inferences. The purpose of survey investigations may also be to
provide scientifically gathered information to work as a basis for the
researchers for their conclusions.

The scientific method is, thus, based on certain basic postulates

which can be stated as under:
1. It relies on empirical evidence;
2. It utilizes relevant concepts;
3. It is committed to only objective considerations;
4. It presupposes ethical neutrality, i.e., it aims at nothing but
making only adequate and correct statements about
population objects;
5. It results into probabilistic predictions;

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 6. Its methodology is made known to all concerned for critical
scrutiny and for use in testing the conclusions through
replication;
7. It aims at formulating most general axioms or what can be
termed as scientific theories.

Thus, “the scientific method encourages a rigorous, impersonal

mode of procedure dictated by the demands of logic and objective
procedure.” Accordingly, scientific method implies an objective, logical
and systematic method, i.e., a method free from personal bias or
prejudice, a method to ascertain demonstrable qualities of a phenomenon
capable of being verified, a method wherein the researcher is guided by
the rules of logical reasoning, a method wherein the investigation
proceeds in an orderly manner and a method that implies internal
consistency.

1.11 ETHICS AND BUSINESS RESEARCH

Ethics in business research refers to a code of conduct or expected

societal norm 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 The observance of ethics begins
with the person instituting the research, who should do so in good faith,
pay attention to what the results indicate, and surrendering the ego,
pursue organizational rather than self-interests. 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.

Thus, ethical behavior pervades each step of the research process-

data collection, data analysis, reporting, and dissemination of

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information of the Internet, if such an activity is undertaken. How the
subjects are treated and how confidential information is safeguarded are
all guided by business ethics.

There are business journals such as the journal of business Ethics

and the Business Ethics Quarterly that are mainly devoted to the issue of
ethics in business. The American Psychological Association has
established certain guideline for conducting research, to ensure that
organizational research is conducted in an ethical manner and the
interests of all concerned are safeguarded.

1.12 SUMMARY

Business research is a management tool that companies use to

reduce uncertainty. Business research, the manager’s source of
information about organizational and environmental conditions, covers
topics ranging from long-range planning to the most ephemeral tactical
decisions.

Business research is the systematic and objective process of

gathering, recording, and analyzing data for decision making. The
research must be systematic, not haphazard. It must be objective to
avoid the distorting effects of personal bias. The objective of applied
business research is to facilitate managerial decision making. Basic or
pure research is used to increase the knowledge of theories and concepts.

Managers can use business research in all stages of the decision-

making process: to define problems; to identify opportunities; and to
clarify alternatives. Research is also used to evaluate current programs
and courses of action, to explain what went wrong with managerial
efforts in the past, and to forecast future conditions.

A manager determines whether business research should be

conducted based on (1) time constraints, (2) the availability of data (3) the

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nature of the decision to be made, and (4) the benefits of the research
information in relation to its costs.

There is a broad variety of applied research topics, such as general

business, economic, and corporate research; financial and accounting
research; management and organizational behavior research; sales and
marketing research; and corporate responsibility research.

1.13 KEYWORDS

Research is simply the process of finding solution to a problem

after thorough examination and analysis of factors.

Business Research is systematic and objective process of

collecting, recording and analyzing data to facilitate business decisions.

Basic/Pure Research is an attempt to verify the acceptability of

theory or to expand the limits of knowledge.

Applied Research is conducted when a decision is made about a

specific real life problem.

Research Methods are methods/techniques used for concluding a

research.

Research Methodology is a way to systematically solve a research

problem.

Scientific Method attempts to achieve a systematic interrelation of

facts by experimentation, observation, logical arguments from accepted
postulates and a combination of these in varying proportions.

1.14 SELF ASSESSMENT QUESTIONS

1. Give some examples of business research in your particular

field of interest?

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 2. In your own words, define business research and list its
tasks.
3. How might a not-for-profit organization use business
research?
4. What is the difference between applied and basic research?
5. Discuss how business research can be used in each stage of
the decision-making process.
6. In your own words, describe the scientific method and state
why it is an essential aspect of business research.
7. Describe a situation where business research is not needed
and a situation where business research is needed. What
factors differentiate the two situations?
8. Why should a manager know about research when the job
entails managing people products, events, environments, and
the like?
9. For what specific purposes is basic research important?
10. When is applied research, as distinct from basic research,
useful?
11. Why is it important to be adept in handling the manager-
researcher relationship?
12. Explain, giving reasons, which is more important, applied or
basic research.

1.15 REFERENCES/SUGGESTED READINGS

• Churchill, Gilbert A (1983) Marketing Research:

Methodological Foundations, The Dryden Press, New York.
• Kothari C.R. (1990) Research Methodology: Methods and
Technique. Wishwa Prakashan, New Delhi.
• Mahalotra N.K. (2002) Marketing Research: An Applied
Orientation. Pearson Education Asia.

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• Mustafi, C.K. 1981. Statistical Methods in Managerial
Decisions, Macmillan: New Delhi.
• Raj, D. (1968), “Sampling Theory,” McGraw-Hill Book
Company, New York.
• Singh, D. and F.S. Chaudhary, 1986. Theory and Analysis of
Sample Survey Designs, Wiley Eastern: New Delhi.
• Yates, E (1960), “Sampling Methods for Censuses and
Surveys,” Charles Griffin & Company, Ltd., London.

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