BUSINESS STATISTICS

UNIT 2 : QUALIFICATION METHODS

OF DATA COLLECTION

 TYPES OF DATA COLLECTION - PRIMARY AND SECONDARY DATA

 CLASSIFICATION OF SECONDARY DATA

 INTERNAL SOURCE DATA

 EXTERNAL SOURCE DATA

 PRECAUTIONS IN THE USE OF SECONDARY DATA

 METHODS OF COLLECTING PRIMARY DATA

 DRAFTING THE QUTIONNAIRE

 PRETESTING THE QUTIONNAIRE ( PIOLET SURVEY )

 TYPES OF DATA COLLECTION - PRIMARY AND
SECONDARY DATA :

 To analyze and make decisions about a certain business, sales, etc.,

data will be collected. This collected data will help in making some
conclusions about the performance of a particular business. Thus,
data collection is essential to analyze the performance of a business
unit, solving a problem and making assumptions about specific things
when required.

What is Data Collection?

a. In Statistics, data collection is a process of gathering information
from all the relevant sources to find a solution to the research
problem. It helps to evaluate the outcome of the problem.
b. The data collection methods allow a person to conclude an answer
to the relevant question. Most of the organizations use data
collection methods to make assumptions about future probabilities
and trends. Once the data is collected, it is necessary to undergo
the data organization process.
c. The main sources of the data collections methods are “Data”. Data
can be classified into two types, namely primary data and secondary
data.
d. The primary importance of data collection in any research or
business process is that it helps to determine many important things
about the company, particularly the performance.
e. So, the data collection process plays an important role in all the
streams. Depending on the type of data, the data collection method
is divided into two categories namely,

 Primary Data Collection methods

 Secondary Data Collection method
 The two types of data are as follows.
1. Primary Data
When an investigator collects data himself with a definite plan or
design in his/her way, then the data is known as primary data.
Generally, the results derived from the primary data are accurate as
the researcher gathers the information. But, one of the disadvantages
of primary data collection is the expenses associated with it. Primary
data research is very time-consuming and expensive.
2. Secondary Data
Data that the investigator does not initially collect but instead obtains
from published or unpublished sources are secondary data. Secondary
data is collected by an individual or an institution for some purpose
and are used by someone else in another context. It is worth noting
that although secondary data is cheaper to obtain, it raises concerns
about accuracy. As the data is second-hand, one cannot fully rely on
the information to be authentic.

Primary Data Collection Method

Primary or raw data is obtained directly from the first-hand source
through experiments, surveys, or observations. The primary data
collection method is further classified into two types, and they are
given below:
1. Quantitative Data Collection Methods
2. Qualitative Data Collection Methods
Quantitative Data Collection Methods :
The term ‘Quantity’ tells us a specific number. Quantitative data
collection methods express the data in numbers using traditional or
online data collection methods. Once this data is collected, the results
can be calculated using Statistical methods and Mathematical tools.
Some of the quantitative data collection methods include Probability
Sampling, Surveys and Conducting Interviews.

Qualitative Data Collection Methods :

The qualitative data is textual or non-numerical. It covers mostly the

images, videos, texts, and written or spoken words by the people. You
can opt for any digital data collection methods, like structured or semi-
structured surveys, or settle for the traditional approach comprising
individual interviews, group discussions, etc.

Methods for collecting data :

1.Interview Method :

As the name suggests, data collection is done through the verbal

conversation of interviewing the people in person or on a telephone
or by using any computer-aided model. This is one of the most often
used methods by researchers. A brief description of each of these
methods is shown below:
Personal or Face-to-Face Interview: In this type of interview, questions are
asked personally directly to the respondent. For this, a researcher can
do online surveys to take note of the answers.
Telephonic Interview: This method is done by asking questions on a
telephonic call. Data is collected from the people directly by collecting
their views or opinions.

Computer-Assisted Interview: The computer-assisted type of interview is the

same as a personal interview, except that the interviewer and the
person being interviewed will be doing it on a desktop or laptop.
Also, the data collected is directly updated in a database to make the
process quicker and easier. In addition, it eliminates a lot of
paperwork to be done in updating the collection of data.

2.Questionnaire Method of Collecting Data :

The questionnaire method is nothing but conducting surveys with a
set of quantitative research questions. These survey questions are
done by using online survey questions creation software. It also
ensures that the people’s trust in the surveys is legitimised. Some
types of questionnaire methods are given below:

Web-Based Questionnaire: The interviewer can send a survey link to the

selected respondents. Then the respondents click on the link, which
takes them to the survey questionnaire. This method is very cost-
efficient and quick, which people can do at their own convenient time.
Moreover, the survey has the flexibility of being done on any device.
So it is reliable and flexible.

Mail-Based Questionnaire: Questionnaires are sent to the selected audience

via email. At times, some incentives are also given to complete this
survey which is the main attraction. The advantage of this method is
that the respondent’s name remains confidential to the researchers,
and there is the flexibility of time to complete this survey.

3.Observation Method :
As the word ‘observation’ suggests, data is collected directly by
observing this method. This can be obtained by counting the number
of people or the number of events in a particular time frame.
Generally, it’s effective in small-scale scenarios. The primary skill
needed here is observing and arriving at the numbers correctly.
Structured observation is the type of observation method in which a
researcher detects certain specific behaviours.

4.Document Review Method :

The document review method is a data aggregation method used to
collect data from existing documents with data about the past. There
are two types of documents from which we can collect data. They are
given below:

Public Records: The data collected in an organisation like annual reports

and sales information of the past months are used to do future
analysis.

Personal Records: As the name suggests, the documents about an

individual such as type of job, designation, and interests are taken
into account.

Secondary Data Collection Method

i. Secondary data collection refers to gathering information that’s
already available. The data was previously collected, has undergone
necessary statistical analysis and isn’t owned by the researcher.

ii. This data is usually one that was collected from primary sources and
later made available for everyone to access. In other words,
secondary data is second-hand information that’s collected by third
parties.

iii. A researcher may ask others to collect data or obtain it from other
sources. Existing data is typically collated and summarized to boost
the overall effectiveness of a research.
 CLASSIFICATION OF SECONDARY DATA :
Various Methods Of Collecting Secondary Data

There are two types of secondary data collection—qualitative secondary

data collection and quantitative secondary data collection. Qualitative
data deals with the intangibles and covers factors such as quality, color,
preference or appearance. Quantitative data deals with numbers,
statistics and percentages. Although the end goal determines which of
the two types of secondary data collection a researcher chooses,
secondary data collection is mostly concerned with quantitative data.

Let’s look at the common secondary data collection methods:

a. Collecting Information Available On The Internet

One Of The Most Popular Methods Of Collecting Secondary Data Is By

Using The Internet. Readily Available Data Can Be Accessed With The
Click Of A Button, Which Makes The Internet One Of The Best Places
Where Secondary Data Can Be Collected From. It’s Practically Free Of
Cost, Although Some Websites May Charge Money—Usually Low Prices.

However, Organizations And Individuals Must Look Out For Inauthentic

And Untrustworthy Sources Of Information

b. Collecting Data Available In Government And Non-Government

Agencies

Government And Non-Government Agencies Such As Census Bureaus,

Government Printing Offices And Business Development Centers Store
Relevant Data And Valuable Information That Both Individuals And
Organizations Can Access.

c. Accessing Public Libraries

Public Libraries House Copies Of Research, Public Documents And

Statistical Information. Although Services May Vary, Libraries Usually
Have A Vast Collection Of Publications Highlighting Market Statistics,
Business Directories And Newsletters.

d. Using Data From Educational Institutions

Educational Institutions Are Often Overlooked When Deciding A Method

Of Collection. Educational Institutions Conduct More Research Than Any
Other Sector. Universities Have A Plethora Of Primary Data That Can Act
As Vital Information For Secondary Research.

e. Using Sources Of Commercial Information

Commercial Information Sources Like Television, Newspapers, Radio Or

Magazines Are A Great Source Of First-Hand Information On Market
Research, Economic Developments, Political Agenda And Demographic
Segmentation.

 Secondary data collection methods are cost-effective and hence

quite popular among businesses and individuals. Small businesses
that can’t afford expensive research have to resort to a cheaper
method of data collection. They can request and obtain data from
anywhere it’s available to identify prospective clients and have a
wider reach when promoting products and services.

 INTERNAL SOURCE DATA :

Internal data is data retrieved from inside the company to make
decisions for successful operations. There are four different areas a
company can gather internal data from: sales, finance, marketing, and
human resources. Internal sales data is collected to determine revenue,
profit, and the bottom line.

a. Sales Data: The sales records of an organization can be a vast source

of secondary data.
b. Financial Data
c. customer databases
d. sales trends and metrics.
e. customer habits.
f. software user trends.
g. operational trends.
h. leadership decision-making.
i. marketing data.
j. internal research.
k. cash flow reports.

 EXTERNAL SOURCE DATA :

External sources refer to the information collected] outside agencies. It
can be collected from primary as well as secondary sources; type of
information can be collected through census or sample method by
conduct! Surveys and investigation.

For instance, to study the problem of transportation in Orissa, if we

obtain the information from Orissa Road Transport Corporation, it would
be known as external sources of data.

 Government sources, such as the U.S. Census Bureau.

 Corporate filings, such as annual reports to the U.S. Securities and
Exchange Commission (SEC)
 Trade, business and professional associations.
 Media, including broadcast, print and Internet.
 Universities.
 Foundations.

 PRECAUTIONS IN THE USE OF SECONDARY DATA :

The investigator must take precautions before using secondary data. In

this juncture, the following precautions should be taken into
consideration.

1. Suitable purpose of investigation

2. Inadequate data
3. Definition of units
4. Degree of accuracy
5. Time and condition of collection of facts
6. Homogeneous conditions
The following are the main precautions that should be taken before using
secondary data.

(1) Reliable agency ● We must ensure the agency that has

published the data should be reliable.

(2) Suitability for the ● The Investigator must ensure that the data
purpose of an enquiry is suitable for the purpose of the present enquiry.
● The suitability of the data is determined by
investigating the nature, objectives, time of
collection, etc. of the secondary data.

(3) Adequacy and ● It is necessary to use adequate data to

accuracy to avoid the avoid biases and prejudices leading to incorrect
impact of bias conclusions.

(4) Method of ● The investigator should also ascertain as to

collecting the data what method was used in collecting the data.
used ● Sampling methods may be biased
depending upon the mode of selection of
samples.
● All these should be ascertained before
making use of the secondary data. D
RD
RAFTING THE QUTIONNAIRE:
What Is a Questionnaire?
A questionnaire is a research tool featuring a series of questions used to
collect useful information from respondents. These instruments include
either written or oral questions and comprise an interview-style format.
Questionnaires may be qualitative or quantitative and can be conducted
online, by phone, on paper or face-to-face, and questions don’t
necessarily have to be administered with a researcher present.
Questionnaires feature either open or closed questions and sometimes
employ a mixture of both. Open-ended questions enable respondents to
answer in their own words in as much or as little detail as they desire.
Closed questions provide respondents with a series of predetermined
responses they can choose from.

Types of questionnaire in research :

It is known that there are four types of questionnaires in research . All of
these types are designed according to the aim of the study .

a. Contingency questions
b. Matrix questions
c. Closed ended questions
d. Open ended questions

Contingency questions – A question that is answered only if the

respondent gives a particular response to a previous question. This
avoids asking questions of people that do not apply to them (for
example, asking men if they have ever been pregnant).

Matrix questions -- can be used in areas like customer feedback

surveys, quizzes and tests based on personalities, surveys on brand
awareness, and many more where multiple answer choices must be
provided for more clarity and quality of the results. It is similar to the
Likert rating scale where the respondents are given multiple sets of
options or choices.

Closed-ended questions-- are used when you need to collect data

that will be used for statistical analysis. They collect quantitative data
and offer a clear direction of the trends. The statements inferred from
the quantitative data are unambiguous and hardly leave any scope for
debate.

Open-ended--or long-form, questions allow respondents to give

answers in their own words. Because there are no restrictions on their
choices, respondents can answer in ways that researchers may not have
otherwise considered. For example, respondents may want to answer
“multiracial” for the question on race rather than selecting from a
restricted list.
Advantages of Questionnaire :
There are some advantages of questionnaires that make it a popular
choice for data collection. Some of these advantages include:

 It is a relatively cheap and quick method of collecting data from a

large number of people.
 It is easy to administer and does not require trained personnel.
 The questionnaire can be used to collect both qualitative and
quantitative data.
 It is a flexible tool that can be easily customized to suit the needs of
the researcher.

Limitations of Questionnaire :
Limitations of Questionnaire are:

 They rely on respondents to provide accurate and honest answers.

This can be a problem if the questionnaire is asking sensitive
questions or if the respondent does not have a clear understanding
of the question.
 Questionnaires can only collect data on what respondents are willing
and able to answer; there may be important information that the
respondent is not comfortable sharing or does not think to mention.
 Questionnaires are static instruments; they cannot adapt to changes
in the respondent’s answers or probe for more information in real-
time.

 PRETESTING THE QUTIONNAIRE ( PIOLET SURVEY ) :

What is a pilot survey?

People think that testing a survey takes a long time and requires a lot of
resources to do it. The pilot survey is a strategy that helps to evaluate or
test a questionnaire using a smaller sample size than the planned sample.

Any test is better than none, so if you are going to do a survey it is best
to test it with the resources you have available, keep in mind that even
 applying it to a very small group of people you can make significant
improvements to your research.

Uses of a pilot survey

You can make use of pilot surveys to:

 Apply it to a small group that will not be evaluated in the original

survey.
 Consider the responses of a selected group as the first results
obtained from the project.
 You can also use a pilot survey as the definitive survey of
your research and deliberately ask participants for feedback, for
example asking them how clear the instructions are or what questions
are difficult to answer.
After obtaining and analyzing results from the pilot survey, logistical,
technical and any other issues can be addressed. You can correct the
questions on your survey or choose the most appropriate types of
questions if, for example, you are going to carry out an online survey.

A pilot survey can be used to detect the lack of training of the personnel
to be surveyed, issues with the logistics of distribution and collection of
the survey as well as errors in the data recording. These problems can be
fixed before taking the actual survey.

Advantages of a Pilot Survey

a. Conducting a pilot survey before the final survey has great benefits
for the researcher. One of the advantages is that they help to detect
the elements that could cause a negative impact on the research,
such as a bad design that causes abandonment or poorly asked
questions that confuse the respondent, causing them to answer
incorrectly or to simply not give any answer. Avoid these common
survey mistakes.

b. A pilot survey also helps to assess the accuracy of the instructions in

advance, to see if all participants understand them.

c. Pilot surveys also save financial resources, because if errors are

found early, there will be less chance of obtaining unreliable results
 that could harm our business or having to start from scratch after
applying the real survey.

d. In short, the main goal of a pilot survey is to determine whether a

large-scale survey is worth conducting.

Disadvantages of a pilot survey

a. The possibility of making inaccurate predictions or assumptions on
the basis of pilot data .

b. Problem arising from contamination

c. Problems related to funding