Business Research Methodology

Chapter 04:
The Business Research Process
 Role/Contributions of Researchers

• Business success depends on the quality of decisions made

by key personnel.

• Researchers contribute to decision making in several key

ways.
– Helping to better define the current situation
– Defining the firm—determining how consumers, competitors,
and employees view the firm
– Providing ideas for enhancing current business practices
– Identifying new strategic directions
– Testing ideas that will assist in implementing business strategies
for the firm
– Examining how much correct a certain business theory is in a
given situation
 Types of Research
1.
Exploratory

A. Based on
2. Descriptive
Purpose

3. Causal
Types of
Research
1. Experiments

B. Based on
2. Surveys
Techniques

3. Observational
Studies
 (A-1) Exploratory Research

• Conducted to clarify ambiguous situations or

discover potential business opportunities
• Not intended to provide conclusive evidence to
determine a particular course of action
• Often used to guide and refine subsequent research
efforts
• Particularly useful in new product development
– Sony and Honda (Business opportunities based on robot
technology?)
 (A-2) Descriptive Research

• Describes characteristics of objects, people, groups,

organizations, or environments
• Tries to “paint a picture” of a given situation by
addressing who, what, when, where, and how questions.
– Ex: Labor Statistics in the form of the Current Population Survey
• Conducted after the researcher has gained a strong grasp
of the situation being studied
• Helps develop research questions and hypotheses
• Helps describe market segments.
– Ex: who are heavy consumers (buy a lot) of organic
food products.
 (A-3) Causal Research
• If a decision maker knows what causes important outcomes
like sales, stock price, and employee satisfaction, then s/he
can shape firm decisions in a positive way.
• Causal Research is conducted to identify cause and effect
relationships
• Very powerful causality lead to greater control

• These three research types often act as building blocks

– Exploratory research builds the foundation for Descriptive
research
– Descriptive research usually establishes the basis for
Causal research
Comparison among Exploratory, Descriptive and
Causal Research
 (B-1) Experiments
• Business experiments hold the greatest potential for
establishing cause-and-effect relationships
• Experiment is a carefully controlled study in which
the researcher manipulates (i.e., altering the level of
a variable) a proposed cause and observes any
corresponding change in the proposed effect
– Test-market: An experiment that is conducted within
actual market conditions
– Ex: McDonald’s does test-marketing new product concepts by
introducing them at selected stores and monitoring sales and
customer feedback
 (B-2) Surveys
• Survey research is the collection of data attained by
asking individuals questions either in person, on
paper, by phone or online.
• Survey research is used to gather the opinions,
beliefs and feelings of selected groups of individuals,
often chosen for demographic sampling. These
demographics include age, gender, ethnicity or
income levels.
– Ex: Polls about public opinion, public-health surveys,
market-research surveys, government surveys and
censuses.
 (B-3) Observational Studies
• An observational study is a study in which the researcher
simply observes the subjects without interfering.
• The researcher has no control over any treatments the
subjects may be given or which groups the subjects may be
separated into, etc.
• The researcher just observes the subjects and records data
based on his/her observations.
– Ex: The researcher may go to shahbagh more and observe the
level of traffic jam in different hours.
Stages of the Research Process
 Step-1: Defining the Research Objectives
• Research objectives are the goals to be achieved by conducting
research. Objectives cannot really be determined until a problem
is identified
• Different types of objectives lead to different types of research
designs
– Exploring the possibilities of entering a new market:
Exploratory research
– Testing the effect of some policy change on employee job
satisfaction: Causal Research
• Literature Review: As a general rule, researchers should first
investigate previous research to see whether or not others may
have already addressed similar research problems.
– Initially, internal research reports and then external research
books or journals (using Google Scholar)
 Step-2: Research Design

• A plan that specifies the methods and

procedures for collecting and analyzing the
needed information
– Provides a framework or plan of action

• The researcher determines-

– The basic research method i.e.
• Survey
• Experiments
• Secondary data
• Observation
 Step-3: Sampling

• A sample is a group of people, objects, or items that

are taken from a larger population for measurement.

• The sample should be representative of the

population to ensure that we can generalize the
findings from the research sample to the population
as a whole.

• Broadly, two types of sampling: Probability vs.

Non-probability sampling
– We will learn details about types of sampling later.
 Step-4: Data Collection
• The process of gathering and measuring
information on variables of interest, in an
established systematic fashion that enables one
to answer stated research questions, test
hypotheses, and evaluate outcomes.

• Sources and tools/techniques of data collection:

– Primary data
• Tools: observation, questionnaire, interview and focus
group discussion
– Secondary data
• Tools: Sales Reports, Financial Statements, Customer
details, Company information, Reports and feedback from a
dealer, retailer, distributor and customers
 Step-5: Data Processing and Analysis

• After the fieldwork has been completed, the

data must be converted into a format that will
answer the manager’s questions.
• The researcher needs to do:
– Editing
– Coding
– Data Analysis
 Step-6: Conclusions and Report Writing

• Effective communication of the research

findings
• Conclusion should be backed up by the
research findings from data analysis
• Writing the research report in an organized
way
• Easy to understand language/words
 Reliability vs. Validity in Research

• Reliability and validity are concepts used to evaluate

the quality of research.
• They indicate how well a method, technique or test
measures something.
• Reliability is about the consistency of a measure.
• Validity is about the accuracy of a measure.
• It’s important to consider reliability and validity
when you are creating your research design,
planning your methods, and writing up your results,
especially in quantitative research.
Reliability vs. Validity in Research (Cont’d)
Differences between Reliability and
Validity
 Chapter 6:
Problem Definition and
The Research Proposal

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 Problem Definition
• Translating a business situation into something that can be
researched
• Begins by coming to a consensus on a decision statement or
question
• Decision Statement:
– A written expression of the key question(s) that a researcher wishes to
answer
– well stated and relevant as researcher translates this into research
objectives

• Problem Definition:
– Process of defining and developing a decision statement and the steps
involved in translating it into more precise research terminology,
including a set of research objectives.
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 The Problem-Definition Process
• A problem occurs when there is a difference/gap between the
current conditions and a more preferable set of conditions

• The gap can come about in a number of ways:

– Business performance is worse than expected business
performance
• Think of all the new products that fail to meet their targeted goals
– Actual business performance is less than possible business
performance
• Bangladesh Biman, Bangladesh Railway
– Expected business performance is greater than possible
business performance

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Steps in The Problem-Definition Process

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Steps in The Problem-Definition Process (cont’d)

• Step-1: Situation Analysis: The gathering of background

information to familiarize researchers and managers with the
decision-making environment
– Researchers apply qualitative research and the situation
analysis begins with an interview between the researcher and
management

• Step-2: Identifying Symptoms: Interviews with key decision

makers also can be one of the best ways to identify key
problem symptoms.
– Probing is an interview technique that tries to draw
deeper and more elaborate explanations from the
discussion
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Steps in The Problem-Definition Process (cont’d)

Identifying the Relevant Issues from the Symptoms:

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Steps in The Problem-Definition Process (cont’d)
Step-3: Writing Managerial Decision Statements and
Corresponding Research Objectives

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Steps in The Problem-Definition Process (cont’d)
• Step-4: Determine the Unit of Analysis
The unit of analysis for a study indicates what or who
should provide the data and at what level of
aggregation.
– individuals (such as customers, employees, and owners)
– households (families, extended families, and so forth),
– organizations (businesses and business units),
– departments (sales, finance, and so forth),
– geographical areas, or
– objects (products, advertisements, and so forth).

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Steps in The Problem-Definition Process (cont’d)

• Step-5: Determine Relevant Variables

There are several key terms that help describe types of
variables:
– Continuous: Variable that can take on a range of values
that correspond to some quantitative amount i.e. Sales
volume, profits, age etc.
– Categorical/Indicator/Dummy/Discrete: Variable that
indicates membership in some group i.e. male or female,
employed or unemployed etc.
– Dependent: Outcome or a variable that is predicted
and/or explained by other variables
– Independent: Variable that is expected to influence the
dependent variable in some way
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Four Scales/levels of Measurement
Four Scales of Measurement (Cont’d)
Steps in The Problem-Definition Process (cont’d)

Step-6: Write Research Questions and Hypotheses

• Research Questions: Express the research objectives

in terms of questions that can be addressed by
research
– “Is there any relation between advertising and sales?”

• Research Hypotheses: Hypotheses are more specific

than research questions
– “Advertising is positively related to Sales”

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 The Research Proposal
• A written statement of the research design
• It includes
– statement of purpose of the study (in the form of
research objectives) and
– a definition of the problem, often in the form of a
decision statement
– Detailed outline of procedures associated with a
particular methodology
– The language should be in FUTURE tense.

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Guidelines: Typical Format of a Research Proposal
1. Introduction
1.1 Background of the study/research
– Current situation/ How the problem arose
– Mention the key research question
1.2 Objective(s)/Purpose(s) of the study
– Tell why you are conducting the research
– One or more (maximum 5) research objectives
– Generally objectives start with- “To”
1.3 Contribution(s) of the study
– Tell how your research will add value to the company or to the knowledge
creation
– Tell why the readers should read your research
1.4 Outline of the study
– Briefly mention the headlines of next sections of the study
 Guidelines: Typical Format of a Research Proposal
(cont’d)

2. Literature Review
– Key findings of previous research which are related to your research topic
– Don’t copy and paste their findings, rather paraphrase (write them in your
own words)
– Keep them consistent and coherent, NOT haphazard.
– Describe the theory (if any) relevant to your research topic/hypotheses
(e.g. agency theory is applicable for capital structure related research.
– This literature review should build the foundation to develop your research
hypotheses later in section 3.2.
 Guidelines: Typical Format of a Research Proposal
(cont’d)
3. Research Questions and Hypothesis Development
3.1 Research Question(s)
– Specify each research question ending with question marks.
– Ex: “What factors do affect the profitability of a company?”

3.2 Hypothesis Development

– Mainly applicable for CAUSAL research
– Hypothesis should be developed based on the previous research or
experience mentioned in literature review in section 2
– There should be a hypothesis for each of the key independent variables you
are interested
– Hypothesis can be written in either Null or Alternative format.
– Ex: “There is a positive relation between sales growth and profitability”
– Ex: “Firm size and profitability are negatively related”
 Guidelines: Typical Format of a Research Proposal
(cont’d)
4. Research Design/ Methodology
4.1 Research Type
– Explorative or Descriptive or Causal research?
4.2 Data Source
– Primary or Secondary data?
– Data collection procedure
4.3 Sample Design
– What type of sampling method will be used?
– Sample size? Time period?
4.4 Measurement of Variables
– How will you measure the key variables? Dependent and independent
variables?
– Can show the detailed table in Appendix
4.5 Econometric Model (if any)
 Guidelines: Typical Format of a Research Proposal
(cont’d)
5. Data Analysis and Expected Outcomes
– What types of data analytical technique will you use?
– Tabulation, graphical analysis?
– Statistical software?
– Regression analysis? If yes, show the regression model and explain briefly.
– Expected outcome (if any) (applicable for causal research)

6. Potential Obstacles/Limitations and Contingency plans

7. Research Schedule/Timeline
8. Conclusion
9. Appendices
10. References
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Thank You!!!

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