chapter 1

RESEARCH METHODS FOR BUSINESS  A Skill-Building Approach Fifth Edition Uma Sekaran and Roger Bougie

Chapter one Introduction To Research

Topics discussed  What is research?  Business research  Types of business research: applied and basic  Managers and research  The manager and the consultant-researcher  Internal versus external consultants/researchers  Knowledge about research and managerial effectiveness  Ethics and business research

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What is an Organization? Organization is an entity where two or more persons work together to achieve a goal or a common purpose. A manager is someone who works with and through other people by coordinating their work activities in order to accomplish organizational goals.

What is research? •

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Research is the process of finding solutions to a problem after a thorough study and analysis of the situational factors. Research is daily and continuous task of organization activities. Research methods are used in the different areas of business-human resources management, production, operations management, business policy and strategy, organizational behavior, marketing, information systems, accounting, finance as part of the social science have the same procedures.

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Research is related to all types of problem. A problem is a discrepancy between an existing and a desired state of affairs. Research assists managers to make decisions that differed according to the types of problems that must be handled: Well-structured problems are straightforward, familiar, and easily defined. In handling this situation, a manager can use a programmed decision, which is a repetitive decision that can be handled by a routine approach. Poorly structured problems are new or unusual problems in which information is ambiguous or incomplete. These problems are best handled by a non-programmed decision that is a unique decision; it requires a custom-made solution.

Business research •

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In general, business research is a systematic and organized effort to investigate a specific problem encountered in the work setting, which needs a solution. Systematic refers to a series of steps that are designed and executed to find a solution or answers to specific issue (identifying the problem, recognizing the relevant factors in the situation to be investigated, gathering data, analyzing data and implementation). Specifically, Business research is an organized, systematic, data-based (external or internal), critical, objective, scientific inquiry or investigation that used to rectify a specific problem.

Inputs (quantitative and qualitative data)

Process (inquiry, investigation, examination, and experimentation)

Outputs (facts or results that helps a manager to deal with the problem situation).

Decision making: the process of choosing from among alternative solutions to resolve a problem.

The importance of research •

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Research generates possible alternatives to solve specific problem efficiently or/and to improve the decision-making process. Research decreases the uncertainty of situations encountered the organization. Decrease the alternatives of situational factors that affect the problem. Forecast the future of business situations resultant to the complexity of modern organizations, and the uncertainty of the environment. Adapt with, but not control, the external environment and control the internal environment. It is a helpful tool to discriminate between good and bad studies published in (professional) journals and to discriminate between good and bad studies conducted by research agencies.

Research and the manager 

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High management level Strategy formulation and implementation. Supervisory performance, managerial leadership style, and performance appraisal systems. Validation of performance appraisal systems. Updating policies and procedures in keeping with latest government regulations and organizational changes. Cultural differences and the dynamics of managing a multinational firms. Participative management and performance effectiveness. Differences in leadership positions, salaries, and leadership styles.

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Human resources Employee behaviors such as performance, absenteeism, and turnover. Employee attitudes such as job satisfaction, loyalty, and organizational commitment. Employee selection, recruitment, training, and retention. Human resource management choices and organizational strategy. Production Just-in-time systems, continuous-improvement strategies, and production efficiencies. Downsizing. Advanced manufacturing technologies and information systems.

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Marketing Organizational outcomes such as increased sales, market share, profits, growth, and effectiveness. Consumer decision making. Customer relationship management. Consumer satisfaction, complaints, customer loyalty, and word-of-mouth communication. Complaint handling. Delivering and performing service. Product life cycle, and product innovation. Impression management, logos, and image building. Product positioning, product modification and new product development. Keeping ahead of the competition.

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Financing Cost of capital, valuation of firms, dividend policies, and investment decisions. Risk assessment, exchange rate fluctuations, and foreign investment. Tax implications of reorganization of firms or acquisition of companies. Collection of accounts receivable. Development of effective cost accounting procedures. Qualified pension plans and cafeteria-type benefits for employees. Deferred compensation plans.

Information system •

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Installation of effective management information systems. Installation, adaptation, and updating of computer networks and software suitable for creating effective information systems for organizations. Installation of an effective data warehouse and data mining system for the organization.

Types of business research: applied and basic

Applied research

Basic research

Routine or general scope

Generate a body of knowledge

Solve a current problem

Comprehend how certain problems that occur in organizations can be solved

Demanding a timely solution; a shorter time frame

Not demanding a timely solution

Based on a scientific manner

Based on a scientific manner 

Managers and Research •

According to conduct a research, managers have two alternative:

Firstly: knowing how to conduct research methods effectively. •

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It gives the mangers the advantages of: Understanding, predicting, and controlling events that are dysfunctional within the organization. Helping the managers to sense, spot, and deal with problems b e f o r e   they got out of hand or get out of control. Helping the managers to interact effectively with the problems. Determining whether or not the recommended solutions are appropriate for implementation.

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Understanding and discriminating the information disseminated in business journals.

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Saving the time and cost.

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Sharpening the sensitivity of managers to the myriad variables operating in a situation; managers easily foresee what information the researchers might require.

Secondly: Hiring of outside researchers or consultants to conduct the research. 

It used to study some of the more complex, timeconsuming problems that managers may encounter.

The manager-researcher relationship •

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The manager must interact effectively with the research team and delineate the roles for the researchers and the management. The manager has to inform the researchers what types of information may be provided and which of their records will n o t  be made available to them. The manager should make sure that there is congruence in the value systems of management and the consultants. Exchange of information helps to increase the rapport and trust levels between the two parties.

Internal versus external consultants/researchers •

Internal consultants/researchers Some organizations have Management Services Department or R & D to solve certain problems. This orientation is useful in several ways. The internal team have a better chance to be accepted by the employees. The team requires much less time to understand the structure, the philosophy and climate, and the functioning and work systems of the organization. An easily and swiftness of implementation. Less cost than an external team cost. For problems of low complexity, the internal team would be ideal. •

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Disadvantages of internal consultants/researchers 1.

The internal team may quite possibly fall into a stereotyped way of looking at the organization and its problems.

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The powerful coalitions in the organization may influence the internal team to conceal, distort, or misrepresent certain facts.

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The recommendations may not get the consideration and attention they deserve if the management does not perceive them as experts.

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Certain organizational biases of the internal research team might make the findings less objective and consequently less scientific.

External consultants/researchers

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The advantages of external consultants/researchers Having worked with different types of organizations provide them with a wealth of experience in dealing with different problems. The external teams 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. There is no chance to fall into a stereotyped way of looking at the organization and its problems. No influence for the powerful coalitions in the organization to conceal, distort, or misrepresent certain facts. The management gives more consideration and attention to the findings of research. For problems of high complexity, the external team would be ideal.

Disadvantages of external consultants/researchers 1. The cost of hiring an external research team is usually high. 2. Departments and individuals likely to be affected by the research study may perceive the study team as a threat and resist them. 3. The external team may charge additional fees for their assistance in the implementation and evaluation phases. 4. The speed and swiftness of implementation are not high. In general, the managers should weigh the pros and cons of using internal and external researchers before making a decision.

The relationship between Knowledge about research and managerial effectiveness Managers are responsible for the final outcome by making the right decisions at work. Therefore, 1. Knowledge of research heightens the sensitivity of managers to many internal and external factors of organizational environment. It helps to facilitate effective interactions with consultants and comprehension of the nuances of the research process. Using the sophisticated technology such as simulation and model building may increase profitable application in certain business areas. knowledge of research greatly enhances the decisionmaking skills of the manager through focusing on problem solutions, fully understanding the recommendations made, and why and how they have been arrived at, make for good managerial decision making. •

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Ethics and business research It refers to a code of conduct or expected societal norm of behavior while conducting research. 1. It pervades each step of the research process- data collection, data analysis, reporting, and dissemination of information on the Internet, if such an activity is undertaken. 2. It 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. 3. Ethical conduct should also be reflected in 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. •

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Discuss, with reasons, whether they fall into the category of applied or basic research For Scenario 1, explain, with reasons, who will conduct the research.

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Scenario 1 To acquire or not to acquire: that is the question. Companies are very interested in acquiring other firms, even when the latter operate in totally unrelated realms of business. For example, CocaCola has announced that it wants to buy China Huiyuan Juice Group in an effort to expand its activities in one of the world's fastest-growing beverage markets. Such acquisitions are claimed to "work miracles." However, given the volatility of the stock market and the slowing down of business, many companies are not sure whether such acquisitions involve too much risk. At the same time, they also wonder if they are missing out on a great business opportunity if they fail to take such risk. Some research is needed here!

Scenario 2 Reasons for absenteeism •

A university professor wanted to analyze in depth the reasons for absenteeism of employees in organizations. Fortunately, a company within 20 miles of the campus employed her as a consultant to study that very issue.

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Scenario 3 Effects of service recovery on customer satisfaction A research scientist wants to investigate the question: What is the most effective way for an organization to recover from a service failure? Her objective is to provide guidelines for establishing the proper "fit" between service failure and service recovery that will generalize across a variety of service industries.